Barbara’s Blog

May 7, 2009

FIRST-TIME HOMEBUYERS ~ 5 COSTS TO CONSIDER

Filed under: Mortgage Rates, News, Tips for Buyers — Barbara @ 8:42 am
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SUMMARY: It’s a great market for first-time homebuyers. But be sure to count the cost before you make the move from renter to homeowner.

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Market conditions have never been better for first-time homebuyers – real estate prices and interest rates are low; there are a lot of homes on the market to choose from; and the government is offering great tax incentives. It’s a great time to buy your first home.

If you are thinking of making the move from renter to homeowner, here are five costs to consider:

COST 1: CREDIT REPORT – Work on improving your credit report. Banks are being more selective about making loans… even with first-time homeowners. The Federal Reserve says a March survey found half of U.S. banks tightened lending standards on prime mortgages in the previous three months, up from 45 percent in February.

A higher FICO score also gives you greater negotiating power over the terms of the mortgage and ultimately, the total cost of the loan. A stellar score ranges from 760 to 850, while scores below 640 might mean you have to pay a significantly higher interest rate.

COST 2: DOWN PAYMENT – Rates on 30-year fixed mortgages are at a record low of 4.78 percent. At the same time, more lenders are demanding larger down payments of 20 percent or more.

You can find out the down payment your lender will require as part of the pre-approval process. This is typically a free service where a lender evaluates your financial situation and tells you the terms of the loan they’re willing to give you. It’s a good idea to get pre-approval before you start looking at houses. That way you’ll know, in advance, what you can afford.

COST 3: ADDED FEES

New fees introduced by Fannie Mae and Freddie Mac in the past year will likely push the price of a mortgage higher for many people. The fees are based on credit profiles, the amount of the loan in relation to property value and the type of home you’re buying. As such, they’ll vary greatly depending on your personal situation, but could total as much as 3 percent of the mortgage.

There are also standard closing costs to consider… service fees charged by the lender covering items such as credit reports, appraisals, documentation and administrative costs. The total expense will vary depending on where you live and your particular situation. Lenders are required to itemize all closing fees, so review them carefully. Some of the more standard fees might be negotiable.

COST 4: INSPECTIONS

A comprehensive home inspection is a must… you don’t want any surprises. Fees will vary depending on the scope of the inspection and whether your inspector offers comprehensive packages. Other inspections might be for lead paint, pests or radon gas. Some of these checks might be required by the lender and included in the closing costs.

The seller might pay for inspections in some cases, but it’s more common for the buyer to foot the bill. After all, you want the inspector to work for you… to represent your best interests.

COST 5: MAINTENANCE

Your mortgage expense is only one of the monthly costs of home ownership alone. Maintenance, upkeep, and utility costs need to be included in your budget.

Your home inspection should alert you to potential large expenditures, e.g. roof and heating/air conditioning. As a general rule… the older the home, the higher the maintenance fees you can expect.

April 30, 2009

Barefoot Wildfires ~ Downsized in 10 minutes

Filed under: Comment, News, Uncategorized — Barbara @ 5:18 pm
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WOW!  What a week this has been!

Last Thursday at 1:15am, the smoke alarms in our Barefoot home woke up my husband.  He said: “Barbara, get up… the burm is on fire!”

The next thing I knew… our neighbor was banging on the door yelling: “Get out! Get out!”

We got dressed… I grabbed my kids’ baby albums, purse, cell phone and dog… and my husband grabbed our computer’s pocket drive, cell phone and ipod.  We jumped in the car and left with houses around us engulfed in flames.  Our home was totally destroyed within 30 minutes.

We were RADICALLY DOWNSIZED in under 10 minutes!  Not highly recommended.

Before the Fire

Before the Fire

 

After the Fire

After the Fire

The BAD NEWS – we lost everything…  including personal items and my family’s pictures and albums, they’re all irreplaceable. And now we have to reconstitute our life… while running our active real estate business.

The GOOD NEWS – we’re all safe and have received an incredible outpouring of love and support from the Barefoot community, our church friends and the entire community. And all of our computer files – business and personal – were backed up on the pocket drive my husband saved.

I’m also working with an awesome – highly professional – team at Century 21 Coastal Lifestyles – Kemp Nash & Linda Given. I’m confident that my clients will continue to receive the outstanding service they have come to expect.

God has a purpose in all of this:

“To announce the year of his grace— to give all who mourn bouquets of roses instead of ashes…. Rename them ‘Oaks of Righteousness’ planted by God to display his glory. They’ll rebuild the old ruins… take the rubble left behind and make it new.”  Isaiah 61:2-4

April 21, 2009

Why Houses Look Better and Better

Filed under: Comment, Market Trends, Mortgage Rates, News, Strategies, Tips for Buyers — Barbara @ 6:30 am
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By Dave Kansas, Wall Street Journal | Real Estate

Some people think it’s a good time to buy a house. Is it?

In the past few weeks, home-sales data have perked up from very low levels. At the same time, home prices continue to fall in most parts of the country and mortgage rates, while ticking up, are at remarkably low levels.

All these data raise an intriguing question: Is now a good time to purchase a home?

It’s important to address the salient caveats. First, we are extremely unlikely to return to the boom-boom era of home investing reached earlier in this decade when prices soared 20% and more per year. Long-run historical data indicate that homes generally match the inflationary trend, rising about 3% a year.

Buy Carefully

Second, this is not the time to take aggressive action. Borrowing too much or utilizing gimmicky mortgages are what got too many people into trouble in recent years. Investing in a home, like investing in the stock market, should be approached prudently. You should be prepared to put at least 20% down and your budget should account for monthly mortgage and principle payments.

·         The importance of the down payment is that it gives you an equity “buffer” in case home prices should continue to decline after your purchase, which may be the case in many communities this year.

One reason to think seriously about a home purchase is the mild revival in real-estate data. According to the National Association of Realtors, new-home sales rose 5.1% in February. The Commerce Department reported that new-home sales gained 4.7% in the same period.

·         The pop in sales activity, which is coming from very low levels and remains fairly weak, is being driven in large part by falling prices. The Case-Shiller Home Price Index for January fell 19% year-over-year. The Commerce Department reported similar drops for new-home sale prices.

The fall in prices and the rise in sales activity is a good thing. It shows that buyers and sellers are starting to agree more and more often on a price. When prices start declining, sellers will hesitate, hoping that the market will rebound. This hesitation has evaporated as prices have continued to fall. The uptick in sales amid falling prices shows that the market is beginning to work once again, which is usually an early indication that a bottom in prices is starting to form.

Don’t Hunt for the Bottom

Some prospective homebuyers naturally want to know when prices will actually hit bottom. Pinpointing a bottom in home prices, however, is very difficult, akin to picking the bottom in the stock market. But data and research indicate we’re getting close.

·         A recent report from Banc of America Securities-Merrill Lynch argues that the housing market could start to demonstrate modest growth and improvement later this year. This forecast relies on long-term mortgage rates continuing to decline. It also notes that a weak job market will hamper growth in housing.

·         Mortgage rates are a key element to buying a home since lower rates make it cheaper to finance your home purchase. Last week, Freddie Mac 30-year mortgage rates ticked up to 4.87%. Merrill Lynch predicts that the Federal Reserve, through the purchase of long-term Treasurys and other tactics, will drive 30-year mortgage rates to 4.2% by year end.

If you believe now is a good time to buy a home and your lifestyle and budget support such a choice, there are a few strategies to consider in order to get the best price.

·         Know what you want. This requires doing the requisite amount of research so you know exactly what you want and what you can afford. Once that’s done, being ready to buy quickly can help you drive a good hard bargain.

·         Be ready to pounce. Cash, of course, is king. If you can write a check for a home, you can drive a very tough bargain in a world of eager sellers. Not everyone has that kind of kitty, so the next best thing is having a pre-approved mortgage. Many sellers are looking to close a deal smoothly and quickly, so having everything lined up ahead of time can strengthen your negotiating position.

·         Negotiate closing costs. Having the seller handle all closing costs can knock a bit off the sale price. It’s a buyer’s market; fight for this.

·         Get an inspection. And make the sale contingent on what you learn. Then renegotiate to lower the price. At the least, make sure that the seller is responsible for all inspection-related improvements.

If acquiring a home is starting to look more interesting, be careful not to confuse buying a house with investing in the real-estate market, whether as a landlord, a property speculator or a stock investor buying homebuilder stocks or real-estate investment trusts.

Real-estate investing can still be pretty dicey in the current market. There may — or may not — be money to be made. But buying a home is all about providing a place for you and your family to live. And as home prices settle at lower levels, you just might become a homeowner much more economically than anyone has in a long time.

April 11, 2009

Happy Easter

Filed under: Uncategorized — Barbara @ 6:25 pm

April 9, 2009

How To Plan For The Home-buyer Credit Even Before You Buy a House

Filed under: News, Tips for Buyers, taxes — Barbara @ 7:50 am
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Reprint Article by Amy Hoak, MarketWatch 

 

CHICAGO — Many of this year’s first-time home buyers will get an extra perk: a tax credit of up to $8,000 that can be claimed on their 2008 taxes. The option to claim the credit now instead of next year puts cash in the hands of eligible buyers soon after they’ve committed to one of the biggest purchases they’ll ever make.

 

To get the funds as soon as possible, those who have already bought in 2009 have it easy: They simply claim the purchase when doing their 2008 taxes this season. It’s a refundable credit, so after it’s applied to any taxes due, taxpayers get a check for the remainder.

But if you haven’t closed on a home yet — and intend to before Dec. 1 — you have a few options to claim the credit:

·         File an extension: This is the speediest way to get your refund, said Ed Smith, a partner in the Boston office of BDO Seidman. An extension gives taxpayers until Oct. 15 to file. If they file electronically, they can receive their refund within 10 days if they use direct deposit, according to the Internal Revenue Service. Remember, even when you get an extension, any taxes owed must be paid by April 15. “If you underestimate, you could be faced with interest and penalties,” said Mark Luscombe, principal tax analyst at CCH, a provider of tax, accounting and audit information, based in Riverwoods, Ill. 

 ·         Amend your return: If you’ve already filed your taxes for 2008 and then purchase a home this year, it isn’t too late to claim the credit for 2008. Those planning on buying a home soon can file an amended return later, after the purchase. But prepare to wait longer for your funds to arrive, Smith said. 

·         Wait until next year: You can also wait to claim the credit on your 2009 taxes. In some scenarios, it might make more sense to wait. For instance, if your income makes you ineligible for the full credit in 2008, but you’re going to make less in 2009, it’s worth it to use the credit on your 2009 return. “If your [household] income was too high in 2008, but one person had their job cut… you might qualify in 2009,” Smith said.

With this credit, eligible homeowners can claim 10% of the purchase price of the home, up to $8,000, or $4,000 for married individuals filing separately. See form 5405 on IRS.gov.

Unlike the previous home-buyer tax credit in effect for people who bought a home in 2008, the one outlined in the American Recovery and Reinvestment Act of 2009 doesn’t have to be paid back over time.

“Before, it was an interest-free loan. Now it can be a real savings,” Smith said.

Do you qualify?

As of March 6, almost 568,000 tax returns claimed a first-time home buyer credit, totaling more than $3.9 billion of the $13.6 billion allotted for the program, according to the Treasury Inspector General for Tax Administration, which audits the IRS.

The 2008 form for the credit is both for people who bought in 2008 (and are eligible for the credit that needs to be repaid) and those who bought in 2009 (and don’t have to repay the credit).

Not all of those claims will be honored.

“For 38,158 of the 567,685 claims, we identified that the taxpayer may have had ownership in a personal residence within the last 3 years, which disqualifies the first-time home buyer credit claim,” the Treasury Inspector General said in a report on the 2009 filing season.

To qualify for the credit:

·         A homeowner must not have owned a principal residence in at least three years.

·         For married taxpayers, both spouses must not have owned a home in the previous three years. “If one spouse wouldn’t qualify, then neither qualifies,” Luscombe said. 

·         The amount of the credit starts phasing out for taxpayers who have a modified adjusted gross income of more than $75,000, or $150,000 for joint filers. 

·         But the credit is reduced to zero when modified adjusted gross income reaches $95,000, or $170,000 for joint filers. 

·         The home must be the taxpayer’s primary residence. 

·         The taxpayer can’t acquire the new home from a relative, including a spouse, parents, grandparents, children or grandchildren.

Frequently asked questions about the tax credit can be found at the National Association of Realtors’ and the National Association of Home Builders’ Web sites. See NAR’s site. See NAHB’s FederalHousingTaxCredit.com. Also, visit the IRS’s first-time home-buyer page.

Pay back

Remember that if you bought a home between April 8, 2008 and Dec. 31, 2008, you’re only eligible for the previous tax credit — one that will require you repay the government over the course of 15 years.

New homeowner Steve Cline, for example, bought his Etters, Penn. home in 2008 and is getting a $7,500 credit that has to be paid back. In hindsight, he wishes he would have waited several more months to buy his home. And he’s certainly not alone.

But even if you bought in 2009, there’s a chance you’d also have to pay the credit back. According to the IRS, if you sell your home in three years or less after the date it was purchased, some or all of the credit has to be paid back at the time of sale.

If you work with a tax adviser and will owe funds due to the sale of your home, it’s probably best to get in touch with that adviser as soon as the sale closes, said Cynthia Jeanguenat, an enrolled agent in Virginia Beach, Va.

“Let them know what is happening in your life so you know where you stand before next tax season,” she said.

Copyright © 2009 MarketWatch, Inc.

 

April 6, 2009

Historically Low Interest Rates

Filed under: Market Trends, Mortgage Rates, News — Barbara @ 7:55 am
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Rates on 30-year mortgages fell recently to the lowest level on record after the Federal Reserve launched a new effort to stimulate the struggling U.S. housing market.

 

Mortgage finance giant Freddie Mac said Thursday that average rates on 30-year fixed-rate mortgages dropped to 4.85% last week, from 4.98% the previous week. This was the lowest in the history of Freddie Mac’s survey, which dates back to 1971, and was down a full percentage point from a year ago. These are truly historic times and they present a great opportunity to anyone who is thinking of buying.

 

If you, or someone you know, is ready to take advantage of historic low prices and historically low interest rates, please call me toll-free (1-888-494-8654) or email me your referral.

 

2009 is a great year to buy real estate in Myrtle Beach. Don’t let this opportunity pass you by.

March 30, 2009

First-Time Home Buyers: Are You Ready to Make the Move?

Filed under: Market Trends, Tips for Buyers, taxes — Barbara @ 9:01 am
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Buying opportunities for first-time home buyers in Myrtle Beach have never been better. Prices and interest rates are low; there is a wide selection of homes to choose from; and Congress is giving first-time homebuyers an added incentive – an $8,000 tax credit.

Twenty-three percent of adults plan to purchase a home in the next five years, and more than half of them (53.5%) are first-time home buyers, according to a survey commissioned by Move Inc., the operator of National Association of Realtors’ Realtor.com Web site.

Despite today’s challenging market conditions, 18.1% of adults plan to buy a home this year in order to take advantage of the $8,000 tax credit.

So… are you ready to make the move? You might be, if you:

1. Are familiar with the market. If you’ve been paying attention to how much houses are listed for in the neighborhoods you’re eyeing and have a realistic view of how much a house will cost you, you’re in good shape. But if you’re dreaming about that big corner house with no clue about its asking price, you may want to spend some more time becoming familiar with the market and how much houses are going for.

2. Have the money for a down payment and closing costs. The down payment is a percentage of the value of the property. Freddie Mac says the percentage will be determined by the type of mortgage you select. Down payments usually range from 3 to 20 percent of the property value. Also, you may be required to have Private Mortgage Insurance (PMI or MI) if your down payment is less than 20 percent. Closing costs include points, taxes, title insurance, financing costs and items that must be prepaid or escrowed and other settlement costs. You can expect to pay between from 2 to 7 percent of the property value. Generally, buyers will receive an estimate of these costs from your lender after you apply for a mortgage.

3. Know how much you can afford. Freddie Mac says that as a general guide, your monthly mortgage payment should be less than or equal to a percentage of your income, usually about a quarter of your gross monthly income. Also, your income, debt and credit history go into determining how much you can borrow. As a general rule, your debt — credit card bills, car loans, housing expenses, alimony and child support — should not be more than about 30 to 40 percent of your gross income.

4. Know what additional expenses will come with owning a home. This includes homeowner’s insurance, utility bills, and maintenance costs — roofing, plumbing, heating and cooling.

5. Have your credit in good shape and make sure your credit report is accurate. Potential lenders will view your credit history — how much debt you’ve accrued, how many accounts you have open, whether your payments are made on time, etc. — to determine whether they’ll give you a loan. You should get a report from each of the three credit reporting companies: Equifax, Experian, and Trans Union.

6. You haven’t made any recent major purchases, particularly a vehicle. If you do, you may have a harder time getting a loan — or it could potentially lower the amount you’ll be approved for.

2009 is a terrific time to buy property in Myrtle Beach, especially for first-time home buyers. If you are planning to purchase a home this year, check out my free “Guide for First-Time Home Buyers.” It has all the information you need to get you started. Click here to order.

Resources: Move.com and Realty Times

 

 

March 24, 2009

Seller Tip: How to Beat Your Competition in 30 Seconds

Filed under: Market Trends, Strategies, Tips for Sellers — Barbara @ 10:08 am
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Home owners in Myrtle Beach are competing with professionals – banks and developers – to attract buyers. Buyers are looking for bargains and the pros are giving them what they want. In order to stay in the game, you must offer your property at a great price. But you can beat the pros in 30 seconds by offering great value as well.  

First impressions will make or break your home sale. Bargain pricing can generate buyer interest, but then it’s “show time.” Buyers want great looking homes in move-in condition. You only have 30 seconds to outshine your competition… to show a buyer why your home is the best value for the money. When buyers walk in the door, it only takes them 30 seconds to decide if your home is the home for them.

Staging your home to accentuate its true value can convert showings to offers. Here are five simple things you can do to showcase your home.

1. Pack Up Early: Most people pack after their home has sold… but why not get a head start now? You’re going to have to pack anyway. Rent storage space or set aside a place in the garage. You’ll be moving soon, so this is your chance to box and label your belongings to make your move to your new home a lot easier.

2. Clean Everything: Clean floors, baseboards, ceiling fans, kitchens, exhausts, appliances, cupboards, bathrooms, tubs, showers. Clean the windows. Clean every exposed surface in the house. Clean inside and outside. Eliminate all odors. Clean houses are more appealing… buyers assume that clean houses are well cared for.

3. Eliminate Clutter: Getting rid of clutter is just as important as cleaning… in fact, they go together. You’ll have to move your clutter anyway in order to clean your exposed surfaces. Why not move them only once? If you haven’t used an item in the last month, pitch it… or pack it away. Remember, you are selling space, not your things.

4. Remove Excess Furniture: Less is more when it comes to furniture. Keep the basics and get rid of the extras. Then rearrange the remaining furniture to create more space. Try different room arrangements until the room looks spacious and open to you. Less furniture means more space… that’s what buyers are looking for.

5. Paint It: A simple, coordinated, neutral, color scheme will make your house look larger… brighter… more appealing to buyers. Why? Because buyers can move right in without having to do anything. You may be able to clean, patch and touch up your walls if you already have a neutral color scheme. However, consider re-painting rooms with bright colors and bold patterns… buyers consider these rooms as more work for them.

Beating the pros and getting your home sold quickly means competing at a professional level. Give buyers what they want – a bargain price for a like-new, model home.

For more information, click here to order my special report, “7 Insider Secrets On Showcasing Your Home For a Successful Sale.”

March 16, 2009

Happy St Patrick’s Day!

Filed under: Comment, Holdays — Barbara @ 8:22 am
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“When Irish eyes are smiling, Tis like a morn in spring.”

Paddy was driving down the street in a sweat because he had an important meeting and couldn’t find a parking place. Looking up to heaven he said, “Lord take pity on me. If you find me a parking place I will go to Mass every Sunday for the rest of me life and give up Irish Whiskey.”

Miraculously, a parking place appeared. Paddy looked up again and said, “Never mind, I found one.”

Kilkenny Castle, Ireland

Kilkenny Castle, Ireland

 

AN OLD IRISH BLESSING 

May love and laughter light your days, and warm your heart and home.

May good and faithful friends be yours, wherever you may roam.

May peace and plenty bless your world with joy that long endures.

May all life’s passing seasons bring the best to you and yours!

March 9, 2009

How to Sell Your Home Quickly at the Best Possible Price

Filed under: Market Trends, Strategies, Tips for Sellers, foreclosures — Barbara @ 11:18 am
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SPRING IS THE PRIME SELLING SEASON IN MYRTLE BEACH. If you want to sell your home or condo, now is the time. But please be aware: the real estate market in Myrtle Beach has changed dramatically. Buyers are looking for bargains and ignoring everything else.

YOU WILL GET THE BEST POSSIBLE PRICE FOR YOUR HOME / CONDO IF YOU GIVE BUYERS WHAT THEY WANT… NOW.

Bargain Hunting:  Buyers always want to get the most for their money. They always have. But now they are looking for real bargains. Why?

·         Buyers are afraid that prices will go lower. They want a built-in price cushion from further market declines. Most analysts agree that prices will be lower a year from now.

 

·         Buyers are picking only the best properties… price, location, condition. They have a lot of homes to choose from… some of them brand new builder closeouts.

 

·         Buyers are few and far between. The lending freeze has shut out many would-be investors. Cash is king… with the exception of first-time homebuyers. But Myrtle Beach is primarily a vacation / second home market.

Bargain Pricing: Serious sellers need to stay ahead of the competition and give buyers the bargains they are looking for. Who’s your competition?

·         Sellers are competing with banks and builders in today’s market place. Banks are trying to unload their foreclosures and builders are trying to unload their spec properties. And that’s where buyers are looking for bargains… and finding them.

 

·         Time works against sellers in a declining market… prices will be lower a year from now. The quicker you sell; the better price you will get. An offer that may seem low to you today, will look great a year from now.

 

·         Banks and builders are serious sellers; they understand this market dynamic. That’s why they are bargain pricing.

Bargain Selling: In a declining market, properties priced at or above the market are priced to sit… not sell. Why? Because the market keeps moving lower… away from the seller. Most properties on the market today are overpriced… they just sit there with little or no activity. That’s bad news for the sellers because time is their enemy.

Pricing to sell requires both fact and forecast. You need to know where prices are now, and predict where they are going.

·         Research your neighborhood; find the lowest priced listings for comparable property. Watch out for unsold builder spec properties that may be off the books. The lowest priced properties in your neighborhood are your competition… generally, short sales and foreclosures.

 

·         Determine market direction. Don’t expect the market to recover in the next year or two. Owners are becoming stressed out by the current economic chaos. We are seeing a constant stream of short sales come on the market… and most of these eventually become foreclosures. Government programs don’t help owners of vacation / second home properties.  So the market trend is down for the foreseeable future.

 

·         Price ahead of the market. If short sales, foreclosures, and builder close-outs are driving the market, then use your pricing power to attract attention, beat the competition, and get your property sold as quickly as possible.  

THE QUICKER YOU SELL… THE BETTER PRICE YOU WILL GET.

CONTACT ME TODAY… I’ll show you how to use your pricing power to get your property sold at the best possible price.

 

 

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