Buying Smart

My fellow iPhone friends.  It’s like Christmas in August.  What new applications will some wonder woman dream up and roll out to you and me and our iPhone friends for free?  Little important presents.

The latest and smoken hot greatest, is a FREE app from Trulia.com.  

Trulia offers a location based property search for Open Houses and Active Listings.  Here’s how it works; you’re driving through a neighborhood and it’s a sweet one.  It’s a sunny afternoon, you have the rag-top down, you’re bumpin to your iTunes and scoping out Open Houses.  You wonder what it would be like to live in this fine neighborhood and what the homes sell for.  Like rubbing a genie’s lamp, you whip out your iPhone, punch the Trulia Home Search App and schzam….the Trulia genie and the iPhone leprechaun figure out where you are on planet earth and like white magic, they serve up property information, Open House news, photos etc., All the action around the corner and down the street where you are at your finger tips. Huh?  Crazy but true.

Here’s all you have to do:  If you don’t have an iPhone yet - Step #1  - Bag One

Launch iTunes, in the little search box located in the upper right and corner [Search iTunes Store], type in trulia , download you’re FREE app, sync your iPhone and you’re ready.  Next time you’re out and about, launch the Trulia app and check it out.

The world is an amazing place.

We put all our listings on Trulia, so if you’re a Prudential Gary Greene seller, you’re in the mix.

Let me know if you have any questions.  Ken Brand 832-797-1779

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Sun and Signs  Originally uploaded by .: sandman

Is it time for you to buy your next home?  The answer depends on the person.  One sure thing, to keep you on track, the services of a savvy street on the feet Realtor can help you sift through the details.  Here’s a list of things your agent should be providing.

Homefinding Services Commitment

As your appointed “Buyer’s Representative”, my duty is to assist you in the purchase of your new home, placing your interests at the forefront of my activities and responsibilities. Any information you share with me is completely confidential and cannot be revealed to the seller or his/her agent unless authorized by you. Listed below are the services I provide to help your home finding and buying experience meet your personal goals as well as making the process as stress free, efficient and successful as possible.

Communicate with you in a timely and efficient manner.

Plan a home search based on your needs.

Consult with you to discover your needs, interests and concerns before developing a home search.

Per Texas Real Estate Commission regulations, discuss agency relationships and the benefits of Buyer’s Representation authorized by an Exclusive Buyer’s Representation Agreement

Research the available inventory of homes meeting your requirements.

• Pre Owned Homes
• New Homes
• Custom Homes

Act as your personal “Information Resource Guide” for…

• The entire home finding, financing, buying and closing process.
• Schools, shopping, community information, worship, parks, athletics, entertainment, dining, clubs and community service organizations
• Property taxes, utilities, homeowners associations, etc.

Introduce you to properties and neighborhoods that meet your requirements based upon our plan.

• Pre-select for viewing, properties that match your criteria.
• Review with you, the information on selected properties and neighborhoods prior to viewing.
• Save time by pre-scheduling showing appointments.
• Lead you on a physical tour of mutually selected properties.
• Provide sources of information on questions of interest to you.
• Help you obtain the financing you may need for a home purchase.

Provide you with information on becoming pre-qualified or pre-approved for a mortgage.

• Help you find a reliable financial institution.
• Help you find and evaluate a mortgage program that meets your needs.
• Monitor loan processing and the approval process to insure a timely closing.

Discuss available “Home Service” contract options that can reduce your liability.

Assist in securing Home Owners Insurance coverage.

For your review and prior to making an Offer To Purchase, provide…

• Samples of all the associated paperwork, addenda and notices.
• An overview of the purchase, escrow and closing process.
• A detailed estimation of the funds needed at closing, including your closing costs and a detailed breakdown of your monthly payment (principal, interest, taxes, insurance, etc.)
• Answer your questions and address any concerns.
• Assist in preparing a purchase offer on the property of your choice.

Review information on sales of comparable properties to help you decide on the price and financing terms that you want to offer.

• Provide you with advice and information on other terms for you to consider.
• Provide all paperwork, contract, disclosure, notices and addenda required to complete the home buying process.
• Recommend that you obtain professional home, termite or other inspections. I will help coordinate the inspection process and review the inspection report(s) with you.
• Enhance your competitive bargaining position by packaging your offer in the most favorable terms for submission to the seller and listing broker.
• Representing you in the transaction with the seller.

Present your offer to the seller, through their real estate broker.

• Negotiate in your best interests, including the handling of counter offers to reach an agreement that is acceptable to you.
• Provide strategic advice regarding counter offers and negotiations.
• Work to protect your interests during the escrow process and through closing.

Insure that the executed contract and earnest money is deposited with the title company.

Review with you the seller’s written disclosure statement.

Review with you the preliminary title commitment.

Review with you the documents pertaining to professional inspection reports.

Work with seller’s broker, Title Company, lender and others to see that all requirements of the purchase agreement are satisfied and to help keep the transaction on schedule for a timely closing.

Keep you informed of the progress of the transaction.

Accompany you on a comprehensive walk-through of the property before closing (if provided for in the agreement) and assist you in managing any problems discovered during the walk-through.

Schedule a date and time for executing the closing documents for your home. Prior to closing, review the Title Company provided Settlement Statement. Address any questions or concerns.

Coordinate the transfer of keys and agreed upon items such as garage door openers etc.

Post Closing Services

• Provide telephone numbers, web site and contact information for the transfer of services such as gas, water, telephone, electricity, etc.
• Follow up contact to answer any questions and address any new needs.

Other Services: What else can we do for you?

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Questions, concerns, comments - give me a call:  Ken Brand 832-797-1779

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It’s a wacky real estate market. If you’re thinking of buying or selling real estate, or you own real estate in The Woodlands Texas, reading these reports will help illuminate the foggy situation and educate you with local facts.  Having said that, keep in mind that these statistics represent The Woodlands real estate market in general.  Real estate is hyper-local in nature.  Before making decisions, you’ll want a savvy real estate agent to diligently research the up to the moment real estate data for your specific neighborhood.

Items of note:

1.  Sales Prices are stable.  Prices have not fallen. Thankfully, The Woodlands real estate market is not the Arizona, Florida or California real estate market.  Buyers looking for the deal of the decade will be disappointed.

2. Real estate economists believe that six months of available “For Sale” listing inventory represents a balanced real estate market.  Over six months of real estate inventory is considered a buyer’s market, less the six month of real estate inventory equals a seller’s market.  Months supply of inventory in The Woodlands has rock steadily flown below five months for two years running.

Take Away = Real estate sales prices are unlikely to fall.  If you’re a buyer and find a property you like, take action, don’t wait, interest rates are expected to rise, so are prices.

3. Oddly, while months supply of inventory is low and sold prices creep higher, the total number of contracts written is lagging behind 2007 totals.  The average number of days on the market for active listing inventory is in the mid 80 day range.  The average number of days on the market for properties that closed in July was 57 days.  

Take Away = If you’re a serious seller and you need to move, analyze the data, consider that seasonally, there will be fewer qualified buyers in the market place now through early next year.  Make adjustments to marketing, merchandising, staging and pricing today.

4.  Real estate agents, the market is a challenging and a shift shaping one where prices are holding steady, inventory is higher and sales are fewer (compared to last year), if you want to prosper, you’ll have to work smarter and harder than you have in the past.  You’ll have to deliver better, more effective results to please more clients and earn more referrals and recommendations.  You’ll want to move some of your marketing investment from old world media like magazines and newspaper and invest in internet broadcasting and advanced property display promotion and merchandising.

Below, you’ll find more data - Average Sold Prices, Days On Market, Months Supply Of Inventory and Market Share Results by Real Estate Broker.

That’s my two cents.  any questions or comments, leave me a comment, send an email or give me call, Ken Brand 832-797-1779

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As the fine details about the $300 Billion Dollar Housing Bill become available, I’ll share them here.  Overall, the plan should benefit the housing market and the economy in general.

Unwrapped, Housing Tax ‘Credit’ is Really a Loan — Washington Post

Washington Post, By Michelle Singletary 

July 31, 2008 

There’s been a lot of discussion about how much the new housing bill passed by Congress will help individuals facing foreclosure.

Some will be able to keep their homes, to be sure. But there’s a different provision of the Housing and Economic Recovery Act that I want to focus on — the much-trumpeted tax credit for first-time homebuyers.

A tax credit is much more valuable than a deduction. A credit reduces dollar for dollar the amount of tax you owe. A deduction merely reduces the amount of your income that is taxable.

Under the new law, certain homeowners will be eligible for a tax credit equal to 10 percent of the purchase price of a home, up to a maximum of $7,500. The credit is $3,750 for married couples filing separately. Unmarried people who jointly purchase a home will be able to divide the $7,500 credit.

When I saw the $7,500 amount, I thought, not a bad tax credit. But there are all kinds of catches.

Before you rush to take advantage of this, be aware it’s a loan cloaked as a credit.

“Essentially this is a loan administered through the tax code,” said Gerald Prante, an economist with the nonprofit Tax Foundation. “I question whether the tax code is the best way to do this.”

Financially, the loan has about the best rate and term you can get. It’s interest-free. Homebuyers would be required to repay the government over 15 years in equal installments for any amount received. 

So let’s say you qualify for the maximum credit of $7,500. Considering the price of housing, just about every first-time buyer would qualify. The terms would mean a yearly loan payment of $500 for 15 years, or about $41.67 a month.

You have to begin repaying the credit in the second tax year after you purchase the home. If you sell the house before you pay off the credit, the entire amount becomes immediately due.

However, if you sell and the gain is less than the credit, then you only have to repay up to the amount of the gain. If the homeowner dies before the credit/loan is repaid, any outstanding amount is forgiven.

The new law defines a first-time homeowner as an individual who has had no ownership interest in a principal residence for a three-year period ending on the date of the current home purchase.

Also, there’s a small window to this opportunity. The credit applies only to homes purchased on or after April 9, 2008, and before July 1, 2009.

Another catch: High-income homebuyers won’t qualify for the credit. You can claim less of the credit amount the more you earn. The phaseout starts for single filers with adjusted income of more than $75,000 and $150,000 for joint filers. It completely phases out at $95,000 for singles; $170,000 for married couples filing jointly.

The credit is also not available to nonresident aliens or those who qualify for a similar tax credit in the District of Columbia. And you can’t take this credit if your home is financed by the proceeds of a qualified tax-exempt mortgage bond.

There is one other tax-friendly provision. The bill would provide homeowners who claim the standard deduction with an additional standard deduction for state and local real property taxes.

The maximum amount that may be claimed under this provision is $500 ($1,000 for joint filers), according to a summary provided by the Senate Finance Committee.

This particular provision will be helpful to taxpayers who don’t itemize. For example, a family with taxable income of $65,100 to $131,450 could deduct $1,000 of property taxes and pay up to $250 less in federal taxes, according to Nebraska Sen. Ben Nelson (D), who issued a release praising the deduction.

Previously, only taxpayers who itemize were able to take advantage of the property tax deduction. About 35 percent of tax returns include itemized deductions, according to Prante.

Ah, but there’s a catch to this deduction, too. It applies only for the 2008 tax year.

Nonetheless, at least for one year, the property tax deduction will help people who are close to paying off their mortgages and thus don’t have a lot of mortgage interest to deduct. It will also help low- to moderate-income homeowners and people in areas with no or low state taxes but who have high property taxes, Prante said.

Weighing these two tax provisions of the new law, I believe the state and property tax deduction will be the most helpful even though it is available just for one year.

I’m not crazy about the tax credit. This loan masked as a credit increases a homebuyer’s debt.

Yes, it will let some people reduce their tax burden, but the benefit is only temporary.

Top of Page

Additional Deduction If you are a homeowner who takes the standard deduction on your federal income taxes and does not itemize, this one is for you. You can now take an additional federal tax deduction of $500, or $1,000 if you are married and filing your tax returns jointly. Again, this one is gravy; you get it in addition to the standard deduction.

Since itemizers are often people who pay a lot of mortgage interest, this deduction will generally benefit people who pay little or none, like those who have paid off their mortgages entirely or close to it. There is one hitch here: you will need to report the property taxes you paid on your tax form. If they are less than $500 (or $1,000 if you are married and filing a joint return), your deduction will be limited to the amount of the property tax you paid.

Reverse Mortgage Changes Reverse mortgages allow older Americans, generally 62 and older, to get a lump sum or a monthly check that comes out of their home equity. They do not have to pay the money back until they stop living there permanently or their heirs sell the house.

The problem with these loans, however, is that they often come with high fees. Moreover, some salespeople pressure borrowers who are applying for the loan to purchase annuities, long-term care insurance or other financial products that are not necessarily in the borrower’s best interest.

The bill tries to address both issues. First, it limits origination fees on reverse mortgages at 2 percent of any loan up to $200,000 and 1 percent beyond that, up to a maximum of $6,000.

The bill also states explicitly that borrowers cannot be forced to purchase an annuity or other financial or insurance product as a condition of qualifying for a reverse mortgage.

Finally, the bill raises the maximum amount that people can borrow. Before, the limits were set on a county by county basis, according to AARP’s legislative policy director, David Certner. The biggest allowable mortgage available anywhere was just over $400,000. Now, there is a nationwide cap of $625,500. 

Redefinition of Jumbo Loans Often, if you want the mortgage loan with the lowest possible interest rate, it has to be small enough to be purchased by Fannie Mae or Freddie Mac from whatever bank or other institution originated it.

Under the new bill, Fannie and Freddie have permanent authority to buy bigger loans in areas with high housing costs. (Temporary measures allow them to buy bigger loans, but those expire on Dec. 31.) They can buy loans up to 115 percent of the local median home price, though they cannot buy any loans larger than $625,500. Any larger loan will generally be a jumbo loan, which will cost more in interest.

A Break for Veterans Lenders will have to wait nine months, instead of 90 days, before beginning foreclosure proceedings on homes owned by someone returning from the military.

Lenders must also wait a year before raising interest rates on a mortgage held by someone returning from military service.

These provisions expire on Dec. 31, 2010.

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Unicorns, Leprechauns and WMDs are myths…so is the the notion of a National Housing Market.  Don’t read me wrong.  Yes, nation wide housing data can be lumped together like an overweight, crappy tasteing merry Christmas Fruitcake, but guess what?  It’s a myth and it’s as useful as a Merry Christmas Fruitcake.

 Real Estate markets are local and hyper-local, period.

Don’t let the talking media bobble heads and jaded journalists hypnotize you into a depressing, misinformed stupor.  Talk to a trusted, in-the-know, feet on the street, real estate agent about what exactly is going on in your community, neighborhood and street.  It may or may not be what you want to hear, but it will be accurate, meaningful and useful.

Amen brothers and sisters….that’s all I have to say about that.

For now.

PS.  If you’d like to pursue a passel of real estate market statistics for The Woodlands, Texas, you can download this .PDF.  I’ll update these stats over the weekend

Listen.

It’s everywhere.  The clouds of unlimited consumption and the fantasy of infinite sustainability are burning off.

Awareness, curiosity and logical conclusion lead to thinking green.

If your in the market for knowledge about how, what, when, where & why and it’s real estate related, you’ll want to meet Stephanie Edwards-Musa.  Stephanie is a rare breed, a pioneer  a leader in Green Real Estate, a bona fide Certified EcoBroker.

 Recently spotlighted in a ABC13 news report, Stephanie knows what’s up, check out her jam packed website for the down-low on Green Real Estate.

Rock on people!

Congress has passed a $300 Billion Dollar Housing Bill and President Bush sez he’ll sign it.

A couple of key points:

1.  ” a $300 billion program to refinance loans for struggling borrowers, and a dramatic rescue plan for embattled mortgage finance firms Fannie Mae and Freddie Mac.”

2.  It also includes tax relief for future home-buyers and current homeowners. Those buying a home between April of this year and through June of next year would receive a tax credit for 10% of the value of their home, up to $7,500, while current homeowners who do not itemize their tax returns would be able to deduct up to $1,000 for property taxes.

Want to read the Wall Street Journal Article - Congress Passes Housing Bill

I’ll share more details early next week.

Sales Down 26.24% and Listing Inventory UP 15.46%

Written Contracts for the month of July, based on current velocity, are projected to total 222 Listings Pended or Placed Under Contract.  Last July (2007) there were 301 Listings Pended or Placed Under Contract.  The difference is 26.24%.  26.24% fewer listing placed under contract than last year at the same time.

What else you should know.
From here, sales will slow through February of 2009.  Historically (see graph) the total number of contracts written per month declines.  School begins anew, the holiday season kicks off and seasonally there are simply fewer buyers in the market place.  Also, we expect that “For Sale” listing inventory will ebb for the same reasons.

Sellers:  Now is the time to make adjustments.  Staging, merchandising, painting, interior and exterior cosmetic enhancements and price adjustments should be made now.  The longer you wait, the harder it will become to sell your property.  Want to sell your property?  Take action now. 

Buyers:  The selection of inventory is healthy, interest rates are expected to climb.  Yes there are fewer sales than last year, but The Woodlands and Houston real estate markets are not even in the same solar system as Florida, Arizona or California.  Real estate markets are local, forget the national news, study local conditions.  SOLD prices have NOT declined, prices have actually appreciated.  It’s not expected to change.  When you find what you like, take action, buy it.

Realtors: Listing Inventory is up, sales are down.  To thrive in this market will require extra effort and actions, actions that are dramatic and remarkable.  More marketing, more connecting, more follow through, more follow up, more communication, more patience, more networking, more service.  Time to step up everything, puny milk toast performance will be wheeled to curb like those big brown trash cans.  If I can support your efforts to shine remarkably, let me know.

Want more market data: Months Supply Of Inventory, Average List Price To Sales Price Percentages, Days On Market, Average Sold Prices - Click HERE for all the gritty details

Want more economic news the Greater Houston Area Economy and where we’re headed?  Click HERE.

If you have any questions about this material, I’d be happy to help, leave me a comment, or email me at Ken@KenBrand.com or you can call me on my cell phone = Ken Brand 832-797-1779.
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All this real estate market data for The Woodlands is complied from the Houston Association of Realtors, Multiple Listing Service. By Ken Brand