Friday, December 19, 2014

2014 Holiday Party Success

Congrats to All the CENTURY 21 JRS Realty agents that received awards at the annual CENTURY 21 JRS Realty Holiday Party. At this years Holiday party Khem Persaud, Eddie Kefalas, and Ana Montes received top honors for sales achievement. Congratulations to all CENTURY 21 JRS Realty agents for making people happy again this year.
A HUGE THANK YOU to the staff of lady's that keep the office going behind the scenes. Betty, Zakiyya, Jennifer, and Melissa are the best administrative assistants any business owner could ask for. THANK YOU ALL!!!!!!!

Thursday, December 18, 2014

It is about to get easier to get a Loan

For years now, if you didn't have near perfect credit and a hefty 20% down payment, chances were slim that lenders would give you a mortgage. But that's all about to change. That's because Fannie Mae and Freddie Mac, the two government-backed mortgage giants that backstop a majority of all mortgages, have put new lending guidelines in place that should make it easier for borrowers to secure loans. Not only are the two agencies lowering downpayment requirements and making it easier for loans to be classified as qualified mortgages, but more importantly, they have clarified when lenders will be on the hook if borrowers default. In the past, Fannie and Freddie have been able to force lenders to buy back loans that have defaulted soon after it was issued, if any mistakes were made in the paperwork or if there was borrower fraud. "Lenders have been real concerned about these buybacks," said Doug Lebda, CEO of LendingTree. "If problems arise with loans, the [Fannie/Freddie] guarantee often fails when lenders need it the most." Related: The 3% down payment mortgage makes a comeback Mel Watt, the head of the Federal Housing Finance Agency, acknowledged that the previous policy made it hard for lenders to understand exactly when Fannie Mae or Freddie Mac would require the banks to repurchase loans. Under the new rules, any loans with no missed payments for 36 consecutive months after they were first issued will be backed by Freddie or Fannie should they default. The agencies will also allow two missed payments in the first 36 months without forcing borrowers into foreclosure.And if private mortgage insurance, which is required for all low downpayment mortgages, is rescinded, say due to errors made in the underwriting process, lenders will not automatically be required to repurchase the loans. "That makes the Fannie/Freddie guarantees more like real insurance," said Lebda. According to Lawrence Yun, chief economist for the National Association of Realtors, the buyback issue has been "the number one hindrance to mortgage lending lately. If it disappears, it would be a big boost to mortgage lending." Freddie and Fannie have also said they will start backing 3% down loans. Borrowers can currently get 3.5% down loans from the FHA, although they require borrowers to pay mortgage insurance premiums for the life of their loans. The new low down payment loans should help boost homebuying among low-income and first-time homebuyers, who have been conspicuously absent from the housing market over the past year. Lenders already seem to be loosening up a bit. Mark Palim, who oversees economic and strategic research at Fannie Mae, said average credit scores for approved loan applications have dropped slightly over the past few months and lenders are doling out loans with lower downpayments as well. According to the Federal Reserve, nearly 14% of senior loan officers said their banks had gotten less strict in the three months ended in October. Of course, lenders are not expected to return to the lax underwriting standards of the boom years. Banks are much more careful these days, making sure that all mortgages are fully documented, said Palim. They don't want to look irresponsible, or worse, predatory. "They're very concerned about reputational risk," he said.

Friday, March 14, 2014

Inventory Down, Prices on the Rise

Home prices will rise in 2014 but at a slower, more steady pace compared with historical trends. The housing recovery has pushed up home prices nearly everywhere. In the past year, home prices rose in 225 of the 276 cities tracked by Clear Capital, a provider of real estate data and analysis. (See how home prices are shifting in 276 metro areas.) Prices nationwide increased by 10.9 percent, pushing the median price for existing homes up by $30,000, to $215,000. For people who have waited to sell their home or refinance their mortgage, that's good news. (Bing: How are interest rates looking this week?) Rising home prices in Seattle enabled Mike and Kristin Litke to refinance their first mortgage last summer and pay off a second mortgage that had an 8.2 percent interest rate. The Litkes, who bought their three-bedroom, 1.5-bath home for $512,500 in 2007 at the peak of Seattle's housing market, had used the second mortgage to avoid paying private mortgage insurance. In 2010, just as home prices in the area hit a trough, they refinanced their first mortgage to a 30-year fixed rate of 4.375 percent but were stuck with the second mortgage because they didn't have enough equity to do a "cash-out" refi. This time, however, their home appraised for $521,000, allowing them to refinance into one 30-year, fixed-rate mortgage of $416,800 at 4.25 percent. They have reduced their monthly payment by $360, giving them some wiggle room in their budget and providing an infusion of college-savings funds for their kids: Stephen, 3½, and Stella, 10 months. What's ahead In 2013, a sense of urgency drove traditional buyers hoping to take advantage of still-affordable home prices and historically low mortgage rates. Buyers found selection limited and were often forced into bidding wars with investors and other buyers who paid cash. Sellers reaped the rewards in terms of quick sales, often above the asking price. Almost half of the cities tracked by Clear Capital experienced double-digit increases in home prices, led by Las Vegas, with a gain of 32 percent. Such spikes reflected a continuing "correction to the overcorrection," says Alex Villacorta, vice-president of research and analytics for Clear Capital. Buyers and investors rushed in to snap up homes with prices that had fallen too far. Homes continue to be affordable, despite recent run-ups — on average, prices are still 31.5 percent below their 2006 peak. The percentage of monthly family income consumed by a mortgage payment (assuming a mortgage rate of 4.1 percent) is just 15.6 percent, on average, compared with 23.5 percent in mid 2006. Home affordability calculator Combined annual income $ Other monthly obligations $ Cash for down payment $ "Houses are very cheap," says David Stiff, principal economist at CoreLogic, a property and mortgage-data analytics company. Market observers agree that home prices will rise in 2014, but at a slower, more steady pace compared with historical trends. Clear Capital forecasts that home prices nationally will rise by 3 percent to 5 percent in 2014, about the historical average. Kiplinger expects an increase of 4 percent. "The most notable thing about 2014 will be how un-notable 2014 is," Villacorta says. Meanwhile, the Conference Board, a nonprofit association of businesses, found that the percentage of consumers who intend to buy a home in the next six months was the highest since 2000. Adding to the push: pent-up demand among young people who, hampered by lack of jobs or insufficient income, have been living in their parents' basements or sharing apartments with roommates. Celia Chen, a housing analyst with Moody's Analytics, says Moody's expects the economy to expand enough in the coming year to enable young people to begin moving out. They'll probably rent first, but low vacancy rates and higher rents will prompt some renters to move on to homeownership. 'Listed': What young homebuyers really want As home prices continue to rise, more owners who had been underwater — meaning that they owed more on their mortgage than their home was worth — will emerge from the sidelines and start selling and buying homes. CoreLogic reports that almost 3.5 million homeowners were lifted out of negative equity between the end of 2012 and mid 2013. Nevada, Florida, Arizona, Michigan and Georgia have the highest shares of underwater homeowners. A sellers market In the past year, sales of existing homes and condos rose by 11 percent, to 5.29 million — almost the highest level in four years. The National Association of Realtors expects sales to remain about the same in 2014. Sales nationally have increased across all regions and in all but one price category, signaling a broad-based recovery. MSN Money: Getting a mortgage is about to get harder Although sales of entry-level homes (priced at $100,000 or less) have fallen by almost half in the past year in the West, they're still rising in the Northeast, where the job recovery has lagged behind other regions. Sales of homes priced between $750,000 and $1 million have risen the most. "A consistent stock market recovery for a prolonged period has opened up the wallets of upper-income homeowners," says Lawrence Yun, chief economist for the National Association of Realtors. Nationally, the supply of homes for sale stands at five months' worth. (Months' supply is a measurement of how long it would take to sell everything at the current pace of sales. A market balanced between buyers and sellers has about six months' supply of homes.) The current level slightly favors sellers, but in many cities inventory is much tighter. For example, the Washington, D.C., suburbs of Montgomery County, Md., and Northern Virginia had about two months' supply in September. Yun says the housing market has moved toward a shortage that will persist through 2014. Why is inventory low? In some cities, institutional investors have been scooping up properties to rent out. Plus, builders cut way back on new-home construction during the bust, and homeowners who bought at the top of the market are still reluctant to sell until they can recoup more of their investment. Some are still underwater, unable to pay off their mortgage with what they'd get for their home. results by Bing Bing Search:Calculating Your Homebuying CostsCalculating Your Homebuying Costs Home Buying Closing Costs How to Estimate Closing Costs home-buying-costs More results from Bing:web | videos | imagesIn Oakland County, Mich., in suburban Detroit, agent Melanie Bishop says home prices fell so far during the economic downturn that even longtime homeowners reaped little or no profit when they sold. But with the housing market's rebound, sellers' prospects have improved. She recently helped Corey and Suzy MacDonald sell the four-bedroom, 2.5-bath home in West Bloomfield that they bought in late 2006 for $272,000. In the spring of 2012, Corey MacDonald became self-employed, and the couple decided to relocate to Florida. They listed their home for sale at $265,000, just enough to pay off their mortgage and expenses. The best offer they received was $245,000, so they decided to postpone their move and try again later. Last summer, they listed the home for sale at $289,900. On the first day, they received an offer of $310,000. "It was a perfect deal," MacDonald says. He ultimately took a job in Atlanta, and the couple used the proceeds from their Michigan sale to put down 20 percent on their next home. The influence of investors will wane as the low-hanging fruit (including foreclosures) disappears in 2014. Once, whole cities were ripe for the picking — such as Cape Coral, Fla., and Phoenix in 2012, as well as Las Vegas and Atlanta in 2013 — but investors must now dig deeper at the neighborhood level, says Villacorta. That's a job probably best suited to smaller numbers of local investors who know their markets best. 'Listed': Homebuilder confidence flat amid rising construction costs Where will new supply come from? Most people who list their homes for sale expect to buy another one, so it's a wash in terms of net inventory. According to the National Association of Home Builders, whose members retrenched during the bust, just less than half as many homes were started this year as in a normal market. NAHB forecasts that a normal pace of housing starts won't resume until late 2015. Tight credit, land and labor, as well as rising costs for materials, are constraining builders. Distressed properties are still adding to the supply of homes nationally, but foreclosure filings are falling. Fewer homeowners are losing their homes as the economy improves, home prices (and home equity) rise, and lenders agree to more short sales (homes sold for less than their owners owe on their mortgages). Slide show: 5 tips to ensure your short sale succeeds "We're in the home stretch of getting through the foreclosure crisis," says Daren Blomquist, vice-president at RealtyTrac, which monitors the foreclosure market. "But we won't cross the finish line, with filings back to pre-crisis level, until early 2015."