My Blog

The Ideal Age for First-Timers to Buy

July 18, 2018

Apparently the magic number for first-time home buyers is 28. That’s the average age that most Americans think a person should be when they buy their own home, according to a new Bankrate.com report conducted  last month among a sample of 1,001 respondents.

This may be a bit optimistic in practice, at least for buyers in today’s market. The National Association of REALTORS®’ 2017 Profile of Home Buyers and Sellers found the median age of first-time buyers was 32 years old for the second year in a row.

The Bankrate study did find some differences in opinion between genders and regions of the country. While a quarter of men think people should strive to buy their first home by age 25, just 12 percent of women say the same. Those who live in the Northeast appeared to have lower expectations for buying a first home than other survey participants. Nearly one in five living in this region responded that the right age to buy a home for the first time is 35 or older, twice as many as any other region.

Posted by Yates Nobles on July 24th, 2018 10:47 AM

Some Design Trends Create Noise Pollution in Homes

July 2, 2018

Smart-home gadgetry and design trends emphasizing openness are leading to more noise disturbances, such as echoes, inside homes. Some homeowners are even hiring “acoustic consultants” to help alleviate the issues.

A common noise-prone living arrangement is an open floor plan with a minimalist design, where more emptiness and fewer items of furniture enable reverberations inside the home. It can make make it difficult for owners to pick up other sounds—including speech—says Bonnie Schnitta, founder of SoundSense, a New York-based acoustic consulting company. Using sound-absorbing fabric in curtains, behind wall hangings, or under rugs can help, she says. Some homeowners may even add sliding doors to separate open spaces and cancel out reverberating noises.

Design experts say the kitchen is a hub for sound issues. Tile countertops and floors, for example, can reflect rather than absorb sound from Wi-Fi–enabled refrigerators and ovens. “Talking and beeping devices, combined with other noise-emitting items like TVs, phones, and iPads, have created a high-tech racket,” The Wall Street Journal reports.

“Homes have suddenly become more ‘live,’” Steve Haas, an acoustic consultant who works in luxury residences, told the Journal. “It emphasizes the need for better control.”

Some luxury homeowners are spending as much as $20,000 per room for an acoustic consultant to evaluate their home and make individualized recommendations for canceling noise inside their homes, including sound-absorbing ceiling plaster, vinyl noise barriers built into walls or ceilings, or noise-reducing ceiling tiles. Noise levels are important to address when creating a peaceful home, says Paul Masi, an architect based in East Hampton, N.Y., who works with acoustic consultants. “When the sound isn’t reverberating or echoing, it gives the sense of a cozier environment,” Masi says.

-from the Wall St Journal

Source: 
Quieting the High-Tech Luxury Home,” The Wall Street Journal (June 28, 2018)
Posted by Yates Nobles on July 3rd, 2018 11:28 PM

2.5M Homes to Be Threatened by Tidal Flooding by the Year 2100

June 20, 2018

Rising sea levels and climate change are putting a significant number of homes at risk of tidal flooding, according to a report released Monday by the Union of Concerned Scientists. The report warns that up to 311,000 coastal homes and about 14,000 commercial properties will be at risk of chronic flooding within the next 30 years. By the end of the century, the UCS says that number will increase to 2.4 million homes—valued at about $912 billion—and 107,000 commercial properties—valued at $152 billion.

The UCS’s study used three sea level rise scenarios to determine how many residential and commercial properties along the entire coastline of the lower 48 are at risk of becoming chronically inundated by high tides (which they defined as flooding an average of 26 times per year or more). The scenarios were in the absence of any major storm.

The state with the most homes at risk by the end of the century was Florida, with about 1 million homes—or more than 10 percent of the state’s current residential properties. New Jersey follows with 250,000 homes at risk, followed by New York with 143,000 homes at risk. These three states were also identified as thse that stand to lose the most in home property values by year 2100: Florida risks $351 billion, New Jersey may lose $108 billion, and New York nearly $100 billion, according to the analysis.

“Not all affected communities will share the same experience,” says Erika Spanger-Siegfried, senior analyst in the Climate and Energy Program at the UCS and a report coauthor. “Some may see sharp adjustments to their housing market in the not-too-distant future; some could see a slow, steady decline in home values; and others could potentially invest in protective measures to keep impacts at bay for a few more decades. In any case, by knowing how much time they have before a significant number of properties will be regularly flooded, communities can start planning and implementing responses now, while they still have a range of options from which to choose.”

The report comes on the heels of the National Association of REALTORS®' call for action Monday urging members to contact their lawmakers and demand an extension to the federal flood insurance program, which expires July 31. The National Flood Insurance Program provides flood insurance to more than 5 million homeowners in 22,000 communities.

Source: 
U.S. Coastal Property at Risk From rising Seas,” Union of Concerned Scientists (June 18, 2018)
Posted by Yates Nobles on June 20th, 2018 4:01 PM

Is Break in Rate Hikes Significant to Buyers?

For the second consecutive week, mortgage rates decreased as the 30-year fixed-rate mortgage fell two basis points to average 4.54 percent, Freddie Mac reports. Rates had been on a steady incline for weeks before breaking trend.

“Home buyers have taken advantage of the recent moderation in rates, which led to a 4 percent increase in purchase applications last week,” said Sam Khater, Freddie Mac’s chief economist. “Although demand has remained steadfast against the backdrop of this year’s higher borrowing costs, it’s important to note that the growth rate of purchase loan balances has moderated so far this year—and particularly since March. This slowdown indicates that buyers are having difficulty stretching to keep up with the pace of home price growth. … Listings for new and existing homes need to increase in the months ahead to moderate price growth and reignite sales activity.” 

Freddie Mac reports the following national averages with mortgage rates for the week ending June 7: 

  • 30-year fixed-rate mortgages: averaged 4.54 percent, with an average 0.5 point, dropping from last week’s 4.56 percent average. Last year at this time, 30-year rates averaged 3.89 percent. 
  • 15-year fixed-rate mortgages: averaged 4.01 percent, with an average 0.4 point, falling from last week’s 4.06 percent average. A year ago, 15-year rates averaged 3.16 percent. 
  • 5-year hybrid adjustable-rate mortgages: averaged 3.74 percent, with an average 0.4 point, falling from last week’s 3.80 percent average. A year ago, 5-year ARMs averaged 3.11 percent. 

Source: Freddie Mac

Posted by Yates Nobles on June 8th, 2018 4:22 PM

3 Steps for Unmarried Couples Looking to Buy

Homebuying dreams can become real for shoppers in unmarried but committed relationships. According to Jessica Lautz, the National Association of REALTORS®’s director of survey research and communication, a report from NAR found that the highest share of first-time buyers who are unmarried couples was in 2017—the highest on record since 1981. Of course, there are significant risks when buying a home with an unmarried partner. But there are precautionary steps your partnered clients can take to ensure they can deal with the posed risks throughout the home planning and shopping together. A recent article in the Seattle Times gives details on three crucial steps:

  1. Sign a prenup for the home. Renee Bergmann, a real estate attorney and owner of Bergmann Law in Westmont, N.J., says couples must have a conversation about potentially breaking up if they want to be co-homeowners. Using help from a legal professional, she says coupled clients should establish a co-ownership contract before closing day. Do not “wait and see what happens”—without a written agreement, Bergmann says, things could get messy very quickly.
  2. Choose the right title. Ownership titles are different in various states, but usually these titles include: sole ownership (one person has the full ownership), joint tenancy (a 50-50 split ownership, with one tenant’s share transferring to the other in the case of death), and tenants in common (allows unequal ownership, such as a 75-25 split). All three approaches have pros and cons, but Bergmann says your clients should consider revising the deed to reflect their new legal status, using a “quitclaim deed,” if they decide to get married after buying. 
  3. Leave parents out of it. Younger couples often get their parents involved during the stressful homebuying process and final transaction. But doing so may cause more confusion, so it may be best to leave the parents at home, says Danielle Moy, an agent with Coldwell Banker Residential Brokerage in Orland Park, Ill. When parents show uncertainty about the situation, it causes “a bit of an emotional roller coaster when they’re looking at homes,” according to Moy. The chosen home and the final decision will ultimately be left in the clients’ hands, Moy says, so be sure to help your partnered clients become aware of what they can agree on and what they want for their homeowning future.

Source: “Buying a home as an unmarried couple? Take 3 steps,” (Seattle Times, April 7, 2018)

Posted by Yates Nobles on April 20th, 2018 12:07 PM
2018 First Quarter | WWW.CAAR.COM
 
Greater Charlottesville Area 2018 First Quarter Highlights:

•    Home sales climbed 13.7% (691) compared to Q1 2017 (608), led by an increase (28.3%) in attached homes. 

•    Greater Charlottesville median sales price rose to $309,145 (13.8%) compared to this time last year ($271,629).  

•    The median days on the market in the 1st Quarter was 70, 11-days lower than in Q1 2017. 

•    Pending sales increased 8.8% (1,134) compared to this time last year (1,042), as new listings declined slightly (1.7%). 

•    Inventory of homes for sale declined -13.9%, resulting in 3.5 months supply of inventory compared to 4.3 months supply in Q1 2017. 
 
2018 First Quarter Greater Charlottesville and County Market Reports 
Please click below:
Posted by Yates Nobles on April 17th, 2018 7:28 PM

Multigenerational Households Hit New High

More generations are living under one roof together. A new analysis from the Pew Research Center shows that households with two or more adult generations hit an all-time high in 2016, using the most recent census data available for the analysis.

Read more: Must-Have Design for Multigenerational Living

The number of multigenerational households rose to an all-time high of 20 percent—or 64 million—of the U.S. population in 2016. 

The multigenerational household trend appears to be growing across nearly all racial and age groups, the Pew Research Center reports. A specific increase in Asian and Hispanic populations does make up a significant part of the boost—both ethnic groups are more likely to live in multigenerational households than white households. About 29 percent of Asians lived in a multigenerational household in 2016 compared to 27 percent of Hispanics, 26 percent of blacks, and 16 percent of whites. 

Also, millennials are the most likely age group to live in a multigenerational household. Thirty-three percent of those ages 25 to 29 live with their parents, according to Pew Research’s analysis. But a greater number of older adults are starting to live with their adult children too. Twenty-four percent of those aged 55 to 64 are living with their children, and 21 percent of those ages 65 and older are living with their children or adult grandchildren, according to the analysis. 

Builders have been trying to prepare for the growth in multigenerational living, such as by introducing new floor plans that include mother-in-law suites, two main floor master bedrooms, or backyard cottages. 

Source: “Number of Multigenerational Households Hit All-Time High,” HousingWire (April 9, 2018)

Posted by Yates Nobles on April 10th, 2018 11:47 PM


Home sellers now use spycams to gather intel on prospective buyers

As home security becomes more prevalent, its use by home sellers to record touring buyers raises questions

Getty Images
A real estate agent views a home for sale in the San Francisco area.

The story previously said Nest thermostats had the capability to listen to conversations. The thermostats do not have a microphone.

Jill Comfort, a Phoenix-area Realtor, had a good feeling about the cream-colored stucco house she planned to show her client, a young man relocating to the city from California. It was in his budget, in the right location and had a huge pool and back yard that would allow him to entertain.

It also had multiple surveillance cameras that recorded everything that went on as prospective buyers walked through.

“When we were walking out of the hallway we could see they were following us,” Comfort said. Both agent and client felt “awkward,” she added.

“I can understand where some sellers are leery of strangers walking through their house, but that’s what happens when you put your house on the market,” Comfort said. Her client, she said, was “creeped out.”

As homes become smarter, real estate agents and home buyers are increasingly finding there’s an extra set of eyes and ears on them as they tour properties for sale. In a 21st-century version of the “nanny cam,” Realtors describe everything from old-fashioned security cameras to newer contraptions tracking their conversations and actions. The rise of these wired home sellers is raising fresh concerns about privacy, courtesy and legality in a transaction that’s already fraught with emotion and potentially full of pitfalls.


The trend has spurred what Joan Rogers, a broker with Windermere Realty Trust in Portland, Ore., calls a “Hey, be aware of this” conversation among her colleagues and counterparts. Rogers says the discussion started in her area about three years ago, “about the same time that integrated home media and security became a thing, with devices that could record your home and report back to you on your smartphone. The conversation started happening that it would be wise to watch your mouth because you just never know what device might be recording.”

Many agents told MarketWatch that it’s not just that having to “watch your mouth” was uncomfortable — it’s more that such an uncomfortable breach of etiquette occurs without any real payoff for the deal.

Andie DeFelice is a broker with Savannah-based Exclusive Buyer’s Realty, Inc., and the president of the National Association of Exclusive Buyer Agents. Last fall, DeFelice took a client to see a home that seemed perfect for his specific needs: it had a detached combination two-car garage and studio with living room, kitchen and full bath — perfect for his grown son.

Shortly after the deal settled and her client had moved in, his new next-door neighbor introduced himself with some unsettling news, saying, as DeFelice put it, “I just want you to know the guy who sold the house knew he had a buyer the minute you walked through.” The neighbor wasn’t making it up: he was able to repeat the conversation client and broker had when they toured the house.

“It’s one of those things where it is the person’s home, they have the right to do whatever — but you feel a little violated,” DeFelice said.

Because the house was one of a very few with the unique feature that the buyer wanted, she added, the seller was right — her client was primed to buy the moment he stepped in the door. And he doesn’t feel that he tipped his hand unknowingly to the camera and then overpaid — although that’s a real risk for other buyers caught commenting during tours. What does rankle DeFelice about the encounter, she said, is that the previous owner referred to him as “the older guy” with a “younger” son when describing the transaction to his neighbor.

Rogers had a similar experience. She was selling the home of a couple who used a Ring Door Bell, now held by Amazon AMZN, -0.55%  , even when their home was not on the market. Although they had signs about ongoing recording clearly posted — as is the law in Oregon — one buyer and her broker lingered on the porch, discussing the property.

Hearing the way the buyers talked about their property was “unsettling” for the sellers, Rogers said. Even though they were the ones capturing a conversation carried on by someone else,“they felt violated with the people standing on the porch talking about the house.”

Read: 7 ways to keep your smart home from being hacked

Ilyce Glink, author of 100 Questions Every First-Time Home Buyer Should Ask, thinks the rise of the recorders isn’t just a natural evolution of technology, but also a logical response by sellers “desperate” for feedback that would once have been provided by their broker. Now, with so many sellers’s brokers leaving keys in lockboxes for buyers’s brokers to retrieve — as was the case with Rogers’s clients, “sellers have rightly been feeling pressured by lower levels of service,” Glink said.

Yet Glink also sees recording devices in a broader context of new technologies that benefit both seller and buyer. For instance, Google Maps offers buyers the chance to see the perimeter of the home, what it’s like to drive along the street and even a peek at surrounding properties — features that sellers will never photograph for formal advertising, she pointed out.

It’s worth noting that this is not just a suburban phenomenon. Gea Elika, who runs an exclusive buyer’s agency called Elika Real Estate in New York, had a client walk out of a high-end Manhattan showing when she saw cameras moving along with her motions — even as the listing agent hovered nearby. “Even I felt uncomfortable,” Elika said.

Elika and other agents interviewed by MarketWatch think technology is only going to become more prevalent in real estate, and many would still like clearer policies and guidelines on how to handle situations now.

The National Association of Realtors has offered a best practices tutorial on the subject, along with a listing of what’s allowed in each state. For now, NAR suggests brokers consider hanging a sign in the home or including a note on the listing form that alerts visiting brokers that there is a surveillance device.

More formal, organization-wide policy that would help brokers guide their clients can be set by any one of several Realtor committees at one of NAR’s two annual meetings, the organization’s general counsel, Katie Johnson, told MarketWatch. “If members are motivated it could happen quickly,” Johnson said.

For Johnson and other lawyers, the rise of recording technology has prompted what she calls emerging unresolved issues, including whether the devices are included with the property in a sale. And with that, what happens with the historical data they’ve captured?

In many situations, however, such questions are academic compared to the demands of the real-life marketplace, which in most areas of the country is still very firmly in the seller’s favor.

But based on her experience, Phoenix-based agent Comfort has decided she’s going to explicitly ask each seller she represents if they have surveillance equipment — yet another conversation that feels “awkward,” she conceded — and she’ll make sure she’s addressing that issue as she shows properties.

Certainly as with most real-estate transactions, each buyer (and seller) are unique. Despite being “creeped out,” Comfort’s young California transplant decided his desire for the home in which he was recorded outweighed the ick factor and he made an offer — ultimately turned down in favor of a more generous one.

Posted by Yates Nobles on March 15th, 2018 8:25 PM

February 9, 2018

The federal budget deal signed by the President on Friday, February 9, 2018, contains a number of wins for real estate, including a temporary extension of federal flood insurance and extension of NAR-backed tax provisions that include relief from debt forgiveness, the deductibility of mortgage insurance premiums, and several energy-efficiency related provisions.

Flood Insurance  Extends the National Flood Insurance Program until March 23, giving lawmakers time to work on longer term reauthorization and reform legislation. It also adds $27 billion in mitigation and resiliency funds to address issues arising from last year's hurricanes. The extension makes $12 billion available under the Community Development Block Grant (CDBG) program to fund U.S. Army Corp of Engineers flood mitigation projects.NAR's Letter on Bipartisan Budget Act of 2018On February 8, 2018, NAR sent a letter(link is external) to Senate Republican Leader McConnell and Democratic Leader Schumer expressing support for the Bipartisan Budget Act of 2018.Tax ExtendersRetroactively extends for the 2017 tax year:

Mortgage Debt Forgiveness  This provision will prevent homeowners who were forced to sell their home through a short-sale last year, or who faced a foreclosure, from being taxed on the “phantom income” they received when a lender cancelled their debt.

Deduction for Mortgage Insurance Premiums  This provision will allow approximately four million homeowners to deduct the mortgage insurance premiums they paid as part of their mortgage. NAR estimates that roughly two million homebuyers annually purchase a home that is subject to mortgage insurance. This provision helps make homeownership more affordable for first time and entry-level homeowners.

Energy efficient commercial buildings deduction  This provision extends the deduction for the cost, up to $1.80 per square foot, of energy-efficient commercial building property. Increasing the energy efficiency of commercial buildings not only helps the environment, it saves building owners and tenants money that they can use to grow their businesses and the economy.In addition to these three major tax extensions, there are also several more minor extenders that affect real estate, as follows:

Nonbusiness Energy Property Credit: 10 percent of amounts paid for qualified energy efficiency improvements (e.g., energy-saving roofs, windows, skylights, and doors) and 100 percent of amounts paid for qualified energy property (e.g., high-efficiency water heaters, air conditioning units, and furnaces), with respect to the taxpayer’s principal residence;Residential 

Energy Efficiency Property Credit: extends and phases down the temporary components of the section 25D residential energy property credit for fuel cells, distributed wind property, and geothermal heat pumps;Credit for energy-efficient new homes: extends the $1,000-$2,000 credit for construction and sale of qualified new energy-efficient homes.All tax provision extensions are only for 2017.

Info courtesy of NAR - National Association of Realtors

Posted in:General
Posted by Yates Nobles on March 9th, 2018 11:27 PM

February 9, 2018

The federal budget deal signed by the President on Friday, February 9, 2018, contains a number of wins for real estate, including a temporary extension of federal flood insurance and extension of NAR-backed tax provisions that include relief from debt forgiveness, the deductibility of mortgage insurance premiums, and several energy-efficiency related provisions.

Flood Insurance  Extends the National Flood Insurance Program until March 23, giving lawmakers time to work on longer term reauthorization and reform legislation. It also adds $27 billion in mitigation and resiliency funds to address issues arising from last year's hurricanes. The extension makes $12 billion available under the Community Development Block Grant (CDBG) program to fund U.S. Army Corp of Engineers flood mitigation projects.NAR's Letter on Bipartisan Budget Act of 2018On February 8, 2018, NAR sent a letter(link is external) to Senate Republican Leader McConnell and Democratic Leader Schumer expressing support for the Bipartisan Budget Act of 2018.Tax ExtendersRetroactively extends for the 2017 tax year:

Mortgage Debt Forgiveness  This provision will prevent homeowners who were forced to sell their home through a short-sale last year, or who faced a foreclosure, from being taxed on the “phantom income” they received when a lender cancelled their debt.

Deduction for Mortgage Insurance Premiums  This provision will allow approximately four million homeowners to deduct the mortgage insurance premiums they paid as part of their mortgage. NAR estimates that roughly two million homebuyers annually purchase a home that is subject to mortgage insurance. This provision helps make homeownership more affordable for first time and entry-level homeowners.

Energy efficient commercial buildings deduction  This provision extends the deduction for the cost, up to $1.80 per square foot, of energy-efficient commercial building property. Increasing the energy efficiency of commercial buildings not only helps the environment, it saves building owners and tenants money that they can use to grow their businesses and the economy.In addition to these three major tax extensions, there are also several more minor extenders that affect real estate, as follows:

Nonbusiness Energy Property Credit: 10 percent of amounts paid for qualified energy efficiency improvements (e.g., energy-saving roofs, windows, skylights, and doors) and 100 percent of amounts paid for qualified energy property (e.g., high-efficiency water heaters, air conditioning units, and furnaces), with respect to the taxpayer’s principal residence;Residential 

Energy Efficiency Property Credit: extends and phases down the temporary components of the section 25D residential energy property credit for fuel cells, distributed wind property, and geothermal heat pumps;Credit for energy-efficient new homes: extends the $1,000-$2,000 credit for construction and sale of qualified new energy-efficient homes.All tax provision extensions are only for 2017.

Info courtesy of NAR - National Association of Realtors

Posted by Yates Nobles on March 5th, 2018 11:07 AM

The spring market for real estate is underway!  So many buyers and not enough homes available…  For example, I have clients who are eager to move forward to find a home on Park St or Locust Ave , or in the Rugby Rd area.   They need a minimum of 3000 square feet,  4 bedrooms and 2 baths, with a yard of at least 1/3 acre.

My clients are ready to proceed and to pay mostly cash.  They are flexible about move-in timing.  My clients are not afraid of taking on renovations and repairs.  They are a lovely family hoping to remain in Charlottesville, but if something tempting does not come on the market soon, they will look outside our town.

So… please contact me if you have any interest in selling your home this spring.  I would certainly appreciate your help with this!  If your home does not meet these clients’ criteria, I would still appreciate hearing from you if you would like for me to do a comparative market analysis on your home as a prelude to my listing and selling it for you.

Thank you for considering selling  your home,
Yates
434-996-0888
yates@syatesnobles.com

Posted by Yates Nobles on March 2nd, 2018 1:48 PM

FHFA Announces Maximum Conforming Loan Limits for 2018

Fannie Mae and Freddie Mac Baseline Limit Will Increase to $453,100

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced the maximum conforming loan limits for mortgages to be acquired by Fannie Mae and Freddie Mac in 2018. In most of the U.S., the 2018 maximum conforming loan limit for one-unit properties will be $453,100, an increase from $424,100 in 2017. 

Baseline limit

The Housing and Economic Recovery Act (HERA) requires that the baseline conforming loan limit be adjusted each year for Fannie Mae and Freddie Mac to reflect the change in the average U.S. home price.  Earlier today, FHFA published its third quarter 2017 House Price Index (HPI) report, which includes estimates for the increase in the average U.S. home value over the last four quarters.  According to FHFA's seasonally adjusted, expanded-data HPI, house prices increased 6.8 percent, on average, between the third quarters of 2016 and 2017.  Therefore, the baseline maximum conforming loan limit in 2018 will increase by the same percentage. 

High-cost area limits

For areas in which 115 percent of the local median home value exceeds the baseline conforming loan limit the maximum loan limit will be higher than the baseline loan limit.  HERA establishes the maximum loan limit in those areas as a multiple of the area median home value, while setting a "ceiling" on that limit of 150 percent of the baseline loan limit.  Median home values generally increased in high-cost areas in 2017, driving up the maximum loan limits in many areas.  The new ceiling loan limit for one-unit properties in most high-cost areas will be $679,650 — or 150 percent of $453,100. 

Special statutory provisions establish different loan limit calculations for Alaska, Hawaii, Guam, and the U.S. Virgin Islands.  In these areas, the baseline loan limit will be $679,650 for one-unit properties, but loan limits may be higher in some specific locations.

As a result of generally rising home values, the increase in the baseline loan limit, and the increase in the ceiling loan limit, the maximum conforming loan limit will be higher in 2018 in all but 71 counties or county equivalents in the U.S.   

Questions about the 2018 conforming loan limits can be addressed to LoanLimitQuestions@fhfa.gov.

  • For a list of the 2018 maximum loan limits for all counties and county-equivalent areas in the U.S. click here
  • For a map showing the 2018 maximum loan limits across the U.S. click here.  
  • For a detailed description of the methodology used to determine the maximum loan limits in accordance with HERA, click here.
Posted by Yates Nobles on March 1st, 2018 10:52 PM

NAR President Elizabeth Mendenhall Clarifies IRS Policy on HELOC Deductions

WASHINGTON (February 22, 2018) - National Association of Realtors® President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty, issued the following statement regarding the IRS announcement clarifying tax deductions taken on home equity loans, lines of credit or second mortgages:

"The National Association of Realtors® is pleased with the IRS announcement clarifying and confirming that under the new tax law owners can continue to deduct the interest on a home equity loan, line of credit or second mortgage when the proceeds are used to substantially improve their residence. There has been much confusion on this issue, and the continued deductibility will bring real benefits to those who choose to take on remodeling projects to bring more resale value to their home or gain equity that may have been lost during the downturn."


Posted by Yates Nobles on March 1st, 2018 10:13 PM

How the New Tax Law Will Affect Homeowners
(Courtesy of US News)

Could the changes to mortgage interest rate and property tax deductions make you want to sell your home?


You can move to find cheaper property taxes. The passing of the Tax Cuts and Jobs Act at the end of 2017 means a few significant home-related tax policy changes for the 2018 calendar year: Mortgage interest rates are only deductible up to $750,000 in debt and property taxes are only deductible up to $10,000.

While these limits don’t affect all homeowners, people who live in counties and cities with high property taxes are likely to feel the financial hit when they file taxes in 2019. If your household is going to struggle without the deductions you’ve had previously, it might be time to look elsewhere.

“For most of the world, I think it really creates a consideration of where I want to be and how I want to be there,” says Cody Vichinsky, co-founder of Bespoke Real Estate, based in Water Mill, New York.

Vichinsky expects housing markets in coastal states to be most impacted by the tax reform – and more specifically in the counties or towns with high-ranked school districts because their property taxes tend to be higher. While homeowners with school-age children may see the education factor weigh heavier than the financial burden, “You’re going to see an exodus out of these neighborhoods for people who don’t need to be there anymore,” he says.

You certainly shouldn’t have a hurried reaction to a policy change with an asset as large as a house, but also keep in mind that if you’re looking for the maximum price on your home, the longer the new tax law sinks in, the more likely it is to change feelings toward pricier neighborhoods in coastal markets.

“We do expect, potentially, in the longer term there may be lower demand at the higher price points because the tax [incentives] just aren’t there,” Sridharan says.

[See: 11 Popular Home Updates That Are Worth the Cost.]

Renovations today won’t come back in full next year. Zillow’s 2018 predictions include the expectation that most homeowners will focus on renovations and updates this year rather than selling. If you’ve got remodeling on your schedule for the year, be sure it’s an update for you because it’s unlikely that renovations will have a 100 percent return when it comes time to sell.

“You’re going to get one shot at this,” Sridharan says. “Ultimately the additional money you’re going to spend to make your home look amazing is going to be far less than the amount of money [a buyer will pay].”

The key to taking advantage of the seller’s market this year is not taking the tight inventory for granted. Buyers will still expect effort from sellers in preparing a property for sale. While they may be willing to overlook a dated kitchen, it's the clutter, deferred maintenance and lack of curb appeal that can still kill a deal. If you do decide put your house on the market, take the process seriously, and you’re likely to see ample interest.

Posted by Yates Nobles on February 24th, 2018 2:20 PM

Why You Should Sell Your Home in 2018

Housing markets should remain tight this year, but 2018 may be a great time to profit as a home seller.  Charlottesville typically lis a leader in real estate market trends, and has been experiencing low inventory of homes for sale for quite a while.  The average number of days on the market has decreased significantly for homes that are reasonably priced, and (as the 2018 tax assessments show in Charlottesville and Albemarle, property values have risen sharply.  Yates' advice is to put your home on the market as soon as possible before rising interest rates affect marketability!

Please read the article that follows:


Why You Should Sell Your Home in 2018
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Homeowners looking to sell should consider 2018 an opportunity to cash in. (Getty Images)

If you haven’t given much thought to selling your home this year, you might want to think again.

Real estate information company Trulia commissioned a survey of more than 2,000 U.S. adults, conducted by Harris Poll, to get a feel for expectations and plans for housing and homeownership in 2018. The survey results show 31 percent of respondents expect 2018 to be a better year for selling a home than 2017 – and just 14 percent expect it to be worse.

Despite the enthusiasm, only 6 percent of homeowners surveyed plan to sell their home in 2018.

[Read: Selling Your House? Here's What to Do With the Windfall of Cash.]

Real estate information company Zillow echoes these sentiments in its predictions for 2018, expecting inventory shortages to continue to drive the housing market. With too few homes on the market to meet buyer demand, prices increase and would-be buyers can’t afford the price or down payment needed to submit a winning offer.

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If you’re a homeowner and have been thinking about selling, what are you waiting for? You may not consider 2018 to be your year to sell, but here are four reasons why selling in the next 12 months could be more beneficial than you think.

Buyers are chomping at the bit. Eager homebuyers have been frustrated over the last few years, experiencing low inventory in most major markets, which is pushing them to start home shopping earlier in the year to try to beat out the competition and ensure they’re not missing out on any available properties.

Even before the clock struck midnight on New Year’s, people were already getting a head start on looking at buying or selling a home in 2018. Real estate information company HomeLight saw a 25 percent traffic spike on its website on Dec. 26, with continued high rates of traffic through the first part of the new year.

“Folks have generally turned their attention away from the holiday and time with family and friends, and moved onto the new year and what they want to accomplish,” says Sumant Sridharan, chief operating officer of HomeLight. “And for many people, that tends to be where they want to live.”

The best time to sell your home is traditionally between March and June, Sridharan notes, while warmer climates may see a longer time frame because they’re not restricted by weather. But cold weather isn’t keeping interested buyers from starting their home search at the start of the year. The fact that buyers take the day after a major holiday to start looking for new home means the traditional selling season could be even hotter.

And while the last couple years have proven beneficial for sellers, seeing many homes sell for asking price or above, it won’t last forever. Zillow predicts home builders will begin looking to construct more entry-level homes to meet demand later this year. If you wait too long to put your home on the market, you may find yourself competing with new builds that haven’t been a part of the market in large numbers since before the recession.

[Read: Will You Be Able to Get a Mortgage in 2018?]

Interest rates are low … for now. For both the buyer of your home and your own next home purchase, low interest rates can help make a transaction possible. In the second week of January, the average interest rate for a 30-year fixed-rate mortgage was 4.17 percent, according to NerdWallet. Mortgage rate averages reached more than 4.4 percent in 2017, but closed the year out just below the current rate.

While mortgage rates aren’t expected to spike significantly this year, they are forecast to increase overall. The Mortgage Bankers Association predicts 30-year fixed-rate mortgages will rise to 4.6 percent this year, and it expects rates to rise to 5 percent in 2019 and 5.3 percent in 2020.

While increasing interest rates are a sign of a good economy, they can squeeze out some potential homebuyers from the market. The current low rates can serve as a catalyst for many potential homebuyers to get moving sooner rather than later. But as interest rates continue to rise, you’re less likely to see as many bidding wars – which is welcome news for buyers but not sellers.

Posted by Yates Nobles on February 24th, 2018 2:15 PM

Mortgage Rates Still Climbing, Not Fading

The 30-year fixed-rate mortgage shows little signs of stopping its gradual move upwards week to week. This marks the seventh consecutive week for higher mortgage rates, and rates continue to be at a four-year high.

“Fixed mortgage rates increased for the seventh consecutive week, with the 30-year fixed mortgage rate reaching 4.40 percent in this week’s survey; the highest since April of 2014,” says Len Kiefer, Freddie Mac’s chief economist. “Mortgage rates have followed U.S. Treasury’s higher in anticipation of higher rates of inflation and further monetary tightening by the Federal Reserve. Following the close of our survey, the release of the [Federal Open Market Committee] minutes for February 21, 2018, sent the 10-year Treasury above 2.9 percent. If those increases stick, we will likely see mortgage rates continue to trend higher."

Freddie Mac reports the following national averages with mortgage rates for the week ending Feb. 22:

  • 30-year fixed-rate mortgages: averaged 4.40 percent, with an average 0.5 point, rising from last week’s 4.38 percent average. Last year at this time, 30-year rates averaged 4.16 percent.
  • 15-year fixed-rate mortgages: averaged 3.85 percent, with an average 0.5 point, increasing from last week’s 3.84 percent average. A year ago, 15-year rates averaged 3.37 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 3.65 percent, with an average 0.4 point, rising from last week’s 3.63 percent average. A year ago, 5-year ARMs averaged 3.16 percent.

Source: Freddie Mac

Posted by Yates Nobles on February 23rd, 2018 10:25 PM

Bitcoin Volatility Leaves Its Future Unknown

Bitcoin has been used in a few real estate transactions in recent months, but does the cryptocurrency really have the power to revolutionize how homes are bought and sold? Housing experts don’t agree unanimously.

“Bitcoin millionaires” is a new breed of financially savvy consumer looking to invest their profits in real estate. Earlier this year, research from realtor.com® uncovered 37 listings nationwide in which bitcoin was mentioned as an acceptable form of payment. The number of sales that have closed using the cryptocurrency is unknown.

The value of bitcoin fluctuates drastically, but recent declines haven’t deterred some luxury home buyers and sellers from wanting to use it. Paul Benson, a broker with Engels & Volkers in Park City, Utah, says he has a client selling eight condo units who prefers to be paid in bitcoin or Ethereum, another form of digital currency. Benson assisted with three other home sales involving bitcoin last year, including a single-family home that sold for the equivalent of $3.5 million in cash.

“I would have expected people to be panicked” when values of bitcoin plunged recently, Benson told realtor.com®. But his clients are prepared for volatility in the currency’s value. “The buyers and sellers are taking the attitude that ‘We’re not in cryptocurrency for a quick get-rich scheme.’ This is a future currency.”

Sellers who demand a certain price for their home may have trouble stomaching the drastic fluctuations in the value of bitcoin, which is not backed by a tangible good, such as gold. It’s all about what other people are willing to pay for it at that moment. “You’re always going to have some people—especially if they’re involved in tech—jump on the bandwagon and use it,” Matthew Gardner, chief economist for Windermere Real Estate, told realtor.com®. “You’ve got to be remarkably brave to get into that market today.”

Bitcoin transactions, which are not subject to bank fees, are verified and documented through blockchain technology. But sellers may still be subject to pay a capital gains tax, even if they accept bitcoin—which is unregulated by the government—as payment for the home. Bitcoin tends to be popular among international buyers, especially Asians and Europeans, because it may provide an easier avenue to funnel money out of their country of origin than navigating government regulations.

While bitcoin has been stealing most of the news headlines lately, it’s hardly the only form of cryptocurrency. There are others, such as Ethereum, Bitcoin Cash, and Litecoin. “There’s definitely a role for cryptocurrency [in real estate],” says Geoffrey Smith, a finance professor at Arizona State University. “My concern is you don’t know which one is going to survive.”

Source: “Will Bitcoin Revolutionize How Real Estate Is Bought and Sold?” realtor.com® (Feb. 8, 2018)

Posted by Yates Nobles on February 23rd, 2018 10:21 PM

                           A guest recently asked me to recommend restaurants in/near Cville.   Here is my quick take.  For a more complete list with addresses and phones, see the Restaurant page on my website, listed under "Cville."  If you want to recommend that I add others, or if you have a bad experience at any of these, please let me know!

HAPPY THANKSGIVING TO ALL!  Yates

==========================================================================================

Expensive:  Fleurie - French - 4th St off downtown mall - intimate 

                  Fossetts (at Keswick Hall) - gorgeous view (ask for window seat)

Med Expensive:  Inn at Court Square - lovely olden ambiance and intimate setting - across from 

Court Square on Jefferson St downtown

         C & O - continental - downtown on Water St - very different settings upstairs (all 

white decor, intimate, more formal) main (casual and fun, more spread out) 

                                    and lower levels (bar and few tables) ... menus & prices may differ: ask them

                           Ivy Inn - continental - continental leaning toward French - just west of town - 

lovely with fireplace on main floor, up is nice too

                           Petit Pois - French - downtown mall - tiny (owned by Fleurie but different menu)

                           Pomme  - French - intimate -in Gordonsville about half hour away

  Boar's Head Inn - very traditional - 250 W just outside town - lunch normally a 

buffet for $19-21 depending on whether you choose hot entree.  Holiday meals 

sure to be special and more expensive - large dining rooms
  Tastings - Market St off downtown mall by parking garage

  Hamiltons - downtown mall - be sure to request a booth or the window nook as it 

                      can be noisy

Moderate:          Now and Zen - Japanese - just north of Market St downtown across from 

           McGuffey Art Center - be sure to call ahead as 

                                  they are no longer open for lunch and not every night for dinner
   Brasserie Saison - downtown maill - continental, mostly French/Belgian

                           Maya - Central American  - West Main

                           Mas - (continental with tapas too) - Belmont

                           Tavola - Italian but broad-ranged - Belmont

                            Ten - Japanese - upstairs near Cville Arts - fun at night with a NYC industrial 

glitz feel

                            Bizous - downtown mall - purports to be French but American traditional 

    Hot Cakes - Barracks Rd Shopping Ctr - order from counter - good food from 

   deli-styled display plus fabulous desserts  

                    Sky Bar - upstairs over Commonwealth Restaurant (good though a bit crowded) on 

            downtown mall (enter from side street) -  (outside bar/and some food - with view of mall makes it
                                   fun and different, 
with fireplace and plastic walls

  Michie Tavern - Tavern from Jefferson’s time near Monticello, open at lunch (not 

sure about evening)  - Buffet style colonial food & waitresses in colonial garb

  Water Street - off downtown mall at 5th & Water - tapas-style and regular 

dinners.  Chef is French.  Slow service.  Nice bar

 

Budget priced:    Whole Foods buffet
    Foods of All Nations - choose and take to the cafe
    Chang's (good fairly authentic Chinese) - Barracks Rd

                            Tara Thai - Barracks Rd shopping center 

                             The Nook - American - downtown mall

                              Revolutionary Soup - downtown mall - self-serve from counter - soup, salad, sandwiches plus wine & beer

                              Sal's Pizza - downtown mall beside Violet Crown Cinema - self-serve from counter - yummy interesting c hoices)

                              Lampo - pizza in Belmont (just over the bridge) - many people swear by this but I haven't tried it yet

Best bakery in town if you want a treat:  Albemarle Bakery in Main St Market on W Main)
                                                                  Remember Hot Cakes as close second - Barracks Rd Shopping Ctr

Burgers:  Zinburger at Barracks Rd

               Citizen Burger on downtown mall
               Authentic old time burgers and atmosphere at Riverside Grill on High St near Free Bridge

Beer:  Court Square Tavern - pub downstairs off Court Sq on 5th St - beers from around the world 

Also:  the “Brew Trail” of micro-breweries SW of Cville down VSH 151 - best views from

Blue Ridge Brewery

Wine:   About 40 vineyards in the area: see the wine guide

  My present favorites are:  

King Family Vineyard in Crozet (polo matches warm seasons, great views)

Pippin Hill Vieneyard down VSH 29-S - splendid views

                        Veritas - Afton area west of town - feels European inside

  Barboursville Vineyard - Orange Co NE of Cville - restaurant Palladio is super but 

expensive

Keswick Vineyard - NE of Cville

Posted by Yates Nobles on November 11th, 2017 10:35 PM

4 Social Benefits of Homeownership

Improved educational performance, higher civic participation, lower crime rates, and improved health remain the biggest social benefits linked to homeownership, according to a new research paper by NAR Chief Economist Lawrence Yun and research economist Nadia Evangelou, which appears in The Journal of the Center for Real Estate Studies. Some findings from the latest research cited in the paper include:

Health. Children of homeowners tend to be happier and healthier than children of nonowners, even after factoring in income and education levels. More recently, studies have found the wealth-building effect of homeownership and the sense of control it often brings in a stable housing market can positively affect homeowners’ mental and physical health. On the other hand, some studies suggest that areas where housing distress is high tend to see greater rates of mental health and stress-related health diagnoses among residents.

Crime. Research has confirmed homeowners have a lower instance of involvement in crime than nonowners. Also, neighborhoods with stable housing options—regardless of ownership structure—are more likely to have lower crime rates. Some studies have found, however, that foreclosure levels do influence burglary and violent crime rates.

Education. Researchers have found homeowners tend to accrue more wealth and save more money—such financial practices are associated with lower rates of homeowners’ children dropping out of school.

Civic engagement. Homeownership and residential stability continues to be linked with an increased likelihood of electoral participation. Homeowners remain more likely to participate in local elections and civic groups than renters, the paper states.

“Owning a home embodies the promise of individual autonomy and is the aspiration of most American households,” the researchers note. “Homeownership allows households to accumulate wealth and social status, and is the basis for a number of positive social, economic, family, and civic outcomes.”

Source: “Social Benefits of Homeownership and Stable Housing,” The Journal of the Center for Real Estate Studies (2017)

Posted by Yates Nobles on October 26th, 2017 4:08 PM
 There has been a general slowdown in sales across the country, and this cannot  be blamed on negative economic news. Unemployment remains low and wage growth, though nothing to overly celebrate, has held steady or increased for several years in a row. There is strong demand for home buying, emphasized by higher prices and multiple offers on homes for sale in many submarkets.

As has been the case for month after month – and now year after year – low inventory is the primary culprit for an y sales malaise rather than lack of offers. Closed Sales increased 2.0 percent for Single-Family Detached homes and 10.8 percent for Single-Family Attached homes. Pending Sales increased 1.0 percent for Single-Family Detached homes but decreased 5.8 percent for Single-Family Attached homes. Inventory decreased 30.9 percent for SingleFamily Detached homes and 24.5 percent for Single-Family Attached homes. The Median Sales Price increased 5.3 percent t o $340,000 for Single-Family Detached homes and 4.8 percent to $240,000 for Single-Family Attached homes. Days on Market decreased 38.1 percent for Single-Family Detached homes and 31.3 percent for Single-Family Attached homes.

Home ownership was less affordable as the Housing Affordability Index was down 6.7 percent over last year at 112. With job creation increasing and mortgag e rates remaining low, the pull toward homeownership is expected to continue. Yet housing starts have been drifting lower, an d some are beginning to worry that a more serious housing shortage could be in the cards if new construction an d building permit applications continue t o come in lower in year-over-year comparisons while demand remains high. Homebuilder confidence suggests otherwise, so predictions of a gloomy future should b e curbed for the time being.
Posted by Yates Nobles on July 7th, 2017 6:11 PM

Conforming Mortgage Limits Rise for 2017

The federal government is increasing the limit for conforming mortgages from $417,000 to $424,100 in most regions of the United States starting Jan. 1, 2017, the Federal Housing Finance Agency announced Wednesday—the first such increase since 2006.

The approximately 1.7 percent bump in the baseline conforming loan limit follows the FHFA’s announcement that  the average U.S. home price has returned to its pre-decline peak, which it hit in the third quarter of 2007. The FHFA bases the loan cap on its quarterly Housing Price Index, which gauges average single-family home prices. The index rose 1.5 percent during the third quarter of 2016 and is up 6.1 percent over the past year, enough to push it above its previous high point.

Conforming loan limits are significant because they apply to home loans that meet the underwriting guidelines of Fannie Mae or Freddie Mac, the government-sponsored entities that acquire mortgages from lenders and ensure a steady flow of money to the mortgage market. Interest rates for nonconforming, or jumbo mortgages, are generally higher than rates for loans that fall under the cap, and these types of mortgages can be more difficult to obtain.

“Today’s conforming loan limit increase is a much-needed recognition of rising home prices in high-cost markets, and a help to first-time and lower-income borrowers looking to utilize an FHA mortgage,” said NAR President William E. Brown. “Credit remains tight, but this decision will help more qualified buyers address the hurdles and high costs standing between them and the dream of homeownership.”

Conforming loan limits are higher than the baseline cap in parts of the country where home prices are especially high, but cannot be more than 150 percent of the baseline limit—$636,150 for 2017—for the contiguous U.S. Exceptions are established for Alaska, Hawaii, Guam, and the U.S. Virgin Islands, where loan limits in specific locations may exceed that amount.

Maximum loan limits for 2017 are up in all but 87 counties or county-equivalents in the U.S., according to the FHFA.

A county-by-county list of conforming mortgage limits for 2017 is available on the FHFA’s website.

Posted by Yates Nobles on December 1st, 2016 5:29 PM
      |

Why Aren't Mortgage Applications Higher? 

More borrowers took advantage of low mortgage rates last week but housing experts say mortgage applications should be much higher.

Total mortgage applications – including those for refinancings and home purchases – rose 2.8 percent on a seasonally adjusted basis compared to the previous week, the Mortgage Bankers Association reports. Most of that increase was due to an uptick in refinance applications, which increased 4 percent week-over-week.

“The last time [mortgage] rates were at these levels, the refi index was almost twice as high,” says Michael Fratantoni, MBA’s chief economist. “At these rate levels, there are borrowers who still stand to benefit, but there are many home owners who have already taken advantage of refinancing and are not yet incentivized to do it again.”

MBA reports the average 30-year fixed-rate mortgage held steady last week at 3.67 percent, still hovering near lows.

Meanwhile, applications last week for home purchases rose slightly by 1 percent and are 5 percent higher when compared to a year ago.

“The weak level indicates few home buyers in the market, likely due to the short supply of homes for sale and higher prices,” CNBC reports.

Mortgage applications have been slowing over the past few months.

"As the economy reaches full employment, the pace of job growth is slowing, and this will slow the growth in purchase activity as well, but we do continue to expect growth in home sales going forward," Fratantoni says.

Source: “Mortgage Applications Up 2.8% But Refinancing Applications Should Be Higher,” CNBC (Aug. 31, 2016)

Posted by Yates Nobles on August 31st, 2016 5:56 PM

Yun: Watch Out for Inflation

Home sales will grow modestly this year, but a continuing inventory shortage will keep upward pressure on prices and make it hard for many people to buy, even though interest rates remain low. That's according to NAR Chief Economist Lawrence Yun, who spoke to members Thursday morning at the 2016 REALTORS®?Legislative Meetings & Trade Expo in Washington, D.C.

Read more: If They Don't Build Homes, You Can't Sell Them

Yun predicted existing home sales will rise to 5.5 million at the end of the year, up slightly from 5.4 million last year. New-home sales will rise to 540,000 units from half a million, but because that segment of the market is currently so far below historical levels, the gains won’t come close to closing the inventory gap, Yun said.

What’s more, most new homes are at higher price points, exacerbating affordability struggles for first-time and moderate-income home buyers. Yun said larger homes are the most profitable for builders, who have to worry about meeting local ordinances and other costs. He added that most new homes come on the market at more than $300,000.

The West saw home prices rise 35 percent over the last three years, making that the least affordable part of the country and dampening sales there, he said. While sales increased almost 20 percent last year in the Northeast, they dropped almost 10 percent in the West.

Inventory shortages continue to be a main driver of price increases, which were almost 7 percent nationally last year. The increase far outpaced wage gains, which were up only about 2 percent. Yun is forecasting prices to rise another 4.5 percent this year.

Continuing low interest rates are a bright spot, but Yun warned that when inflation picks up, mortgage rates will follow suit. Yun said today’s low consumer price index (CPI), at about 1.7 percent, doesn’t reflect the rise in prices people are seeing on everyday items because low gas prices are keeping the broader index down.

But CPI won’t stay low forever. Yun said the monthly rental rate tenants pay is going up (almost 4 percent this year, a seven-year high) and that will send the broader index up. When that happens, the Federal Reserve will raise the short-term interest rate it charges banks, which in turn will impact mortgage rates.

Right now he’s forecasting mortgage rates to be at 3.9 percent at the end of this year, about where they were last year, and to rise to 4.6 percent in 2017. Yun identified 6 percent as a mortgage-rate threshold, noting anything much higher than that will curb home sales. “If rates get to 7 or 8 percent,” he said, “watch out.”

Bottom line: Look for modest market growth this year and next, but as long as inventory shortages persist, homes will become increasingly unaffordable. Once mortgage rates start going up, which they could do as rental rates continue rising, sales will be hurt.

—Rob Freedman, REALTOR® Magazine

Posted by Yates Nobles on May 31st, 2016 12:42 PM

Yun: Watch Out for Inflation

Home sales will grow modestly this year, but a continuing inventory shortage will keep upward pressure on prices and make it hard for many people to buy, even though interest rates remain low. That's according to NAR Chief Economist Lawrence Yun, who spoke to members Thursday morning at the 2016 REALTORS®?Legislative Meetings & Trade Expo in Washington, D.C.

Yun predicted existing home sales will rise to 5.5 million at the end of the year, up slightly from 5.4 million last year. New-home sales will rise to 540,000 units from half a million, but because that segment of the market is currently so far below historical levels, the gains won’t come close to closing the inventory gap, Yun said.

What’s more, most new homes are at higher price points, exacerbating affordability struggles for first-time and moderate-income home buyers. Yun said larger homes are the most profitable for builders, who have to worry about meeting local ordinances and other costs. He added that most new homes come on the market at more than $300,000.

The West saw home prices rise 35 percent over the last three years, making that the least affordable part of the country and dampening sales there, he said. While sales increased almost 20 percent last year in the Northeast, they dropped almost 10 percent in the West.

Inventory shortages continue to be a main driver of price increases, which were almost 7 percent nationally last year. The increase far outpaced wage gains, which were up only about 2 percent. Yun is forecasting prices to rise another 4.5 percent this year.

Continuing low interest rates are a bright spot, but Yun warned that when inflation picks up, mortgage rates will follow suit. Yun said today’s low consumer price index (CPI), at about 1.7 percent, doesn’t reflect the rise in prices people are seeing on everyday items because low gas prices are keeping the broader index down.

But CPI won’t stay low forever. Yun said the monthly rental rate tenants pay is going up (almost 4 percent this year, a seven-year high) and that will send the broader index up. When that happens, the Federal Reserve will raise the short-term interest rate it charges banks, which in turn will impact mortgage rates.

Right now he’s forecasting mortgage rates to be at 3.9 percent at the end of this year, about where they were last year, and to rise to 4.6 percent in 2017. Yun identified 6 percent as a mortgage-rate threshold, noting anything much higher than that will curb home sales. “If rates get to 7 or 8 percent,” he said, “watch out.”

Bottom line: Look for modest market growth this year and next, but as long as inventory shortages persist, homes will become increasingly unaffordable. Once mortgage rates start going up, which they could do as rental rates continue rising, sales will be hurt.

—Rob Freedman, REALTOR® Magazine

Charlottesville Area Market:

Charlottesville is experiencing several of the factors discussed in this article.  While home sales have been brisk so far this year, the inventory continues to be less than we could hope for.  So attention Sellers:  it is not too late to put your house on the market.  Please contact me and we can evaluate your particular situation.

The current favorable rates probably won't last much longer as the Fed is forewarning of increasing interest rates which, in turn, will nudge up real estate loan rates.   With every increase in loan rates, a buyer could have afforded more home for the same payment as will be necessary with each increased rate hike.  So attention Buyers:  Don't wait for prices or rates to drop because neither should happen.  Local housing prices have been rising rapidly this year and should continue to do so.


Posted by Yates Nobles on May 30th, 2016 6:50 PM

For the First Time in Weeks, Rates Move Lower

On the heels of last week's decision by the Fed to keep rates unchanged, mortgage rates dropped slightly this week, after four straight weeks of increases.

“The Federal Reserve’s decision last week to maintain the current level of the Federal funds rate combined with the reduction in their forecast for growth triggered a 3-basis point drop in the 10-year Treasury yield,” says Sean Becketti, Freddie Mac’s chief economist. “As a consequence, the 30-year mortgage rate declined 2 basis points to 3.71 percent. However, comments this week by several members of the Fed, including the presidents of the Richmond, San Francisco, and Atlanta banks, indicated that a June rate hike is still on the table.”

Freddie Mac reports the following national averages with mortgage rates for the week ending March 24:

  • 30-year fixed-rate mortgages: averaged 3.71 percent, with an average 0.5 point, dropping from last week’s 3.73 percent average. Last year at this time, 30-year rates averaged 3.69 percent.
  • 15-year fixed-rate mortgages: averaged 2.96 percent, with an average 0.4 point, falling from last week’s 2.99 percent average. A year ago, 15-year rates averaged 2.97 percent.
  • 5-year hybrid adjustable-rate mortgages: averaged 2.89 percent, with an average 0.5 point, dropping from last week’s 2.93 percent average. Last year at this time, 5-year ARMs averaged 2.92 percent.

Source: Freddie Mac

Posted by Yates Nobles on March 25th, 2016 6:30 PM

CAAR Publishes 2015 Year-End Market Report

Charlottesville Area Year-End 2015 Highlights:

  • Home sales in Greater Charlottesville have now increased for four consecutive years as the 3,282 homes sold in 2015 marked the highest level since 2006.
  • Pricing remained steady with a median sales price of $270,000 for the year, unchanged from 2014 and 10.2% higher than the 2011 bottom of $245,000.
  • Inventory is 16.5% lower than this time last year, the lowest level since year-end 2005.
  • Half the homes sold in 2015 were on the market 46 days or less, a six-day improvement from the median DOM of 2014 and the lowest level since 2006.
Yearly Home Sales Index
Posted by Yates Nobles on February 5th, 2016 10:47 AM

ThANK YOU, LOUIS COULTER OF AVANT BLOG FOR SHARING THE FOLLOWING ARTICLE:

4 HOME IMPROVEMENTS YOU CAN MAKE THIS YEAR

4 Home Improvements You Can Make This Year

You cut coupons to save at the grocery store, maybe put money away in a jar for a special purchase, but are you doing anything to save on your home expenses? This infographic has a few tips you can use to make your home more efficient and keep money from falling through the cracks.

Green-Improvements-Home

Inspired to make things greener? Find out more information on the Department of Housing and Urban Development‘s home improvement page. For information on financing, visit SunTrustAvant and Wells Fargo

Upgrade Your Lights

Make the switch to LED bulbs

Unlike appliances and other energy-efficient products, LED bulbs that are Energy-Star rated are rated for quality as well as efficiency

LED bulbs feature many benefits like:

  • Less heat emission
  • No toxic materials
  • More eco-friendly

Cost-

  • $4 – $10 per bulb depending on bulb type and application
  • Annual energy cost – $1 based on 2 hrs/day of usage and an electricity rate of 11 cents per kilowatt-hour
  • Bulb Life – 25,000 hrs (in most cases)

Savings-

  • 75-80% over traditional bulbs
  •  72% over halogen bulbs
  •  5+% over CFLs

ROI – 100% in 24.9 months

Level of difficulty – Easy

Install Reflective Roofing

Reflective roofing can help you lower your energy costs by reflecting light and heat away from your home

Reflective roofing feature many benefits like:

  • Reducing your heating and air conditioning costs
  • Maintaining consistent indoor temperature
  • Decreasing heat damage on your roof

Cost-

  • $0.75 – $1.50 ft2 for low or flat roof coatings
  • $0.05 – $0.10/ft2 for cool-roof upgrade on new
  • $1.50 – $0.10/ft2 for single-ply membranes
  • $0.10 – $0.20/ft2 for a built-up roof with a cool coating

Savings-

  • An average of $0.50 on heating and cooling costs over traditional roofing materials

ROI – 75%

Level of difficulty – Difficult.

You will need to hire professional roofers

Upgrade Your HVAC

Cleaning your HVAC system at least once a year will keep it operating smoothly

You can also make upgrades to your HVAC system:

  • Upgrade your HVAC fan to move air more efficiently through your house
  • Upgrade your furnace, and/or hot water boiler to a more efficient model
  • Upgrade to a heat, pump, will will move air from the outside indoors
  • Upgrade to a biomass stove, which can burn wood, plant material, and agricultural waste

Cost-

  • Consumer Cost for regular maintenance – $237-$428

Savings-

  • Savings – Up to 80% depending on the severity of the problem

ROI – 75%

Level of difficulty – Medium

Buy New Windows and Doors

New windows and doors can dramatically reduce the amount of heat loss or gain you experience in the winter and summer

Windows:

  • Replacement windows should be thermal insulated windows
  • Use replacement windows with a silicon-based, or foam-based window seals
  • Reinforcements in the window frames will help reduce buckling and sagging over time
  • Only buy replacement windows with insulated frames, as these will provide the best performance and energy efficiency

Doors:

  • Buy solid core doors or doors with significant foam insulation
  • If buying wood doors, opt for hardwood cores
  • If buying steel or fiberglass doors, a thermal break is required

Cost-

  • Consumer Cost for standard double pane windows – $300 per window
  • Triple-pane high efficiency windows – $1,000-$2,000 per window
  • Per Door Installed – $500 – $1,400

Savings –

Up to 40% on energy costs, depending on window efficiency and installation method

ROI – 85% for windows

98% for doors  (depending on quality and construction)

Level of difficulty – Medium to Difficult

 

 

 

Posted by Yates Nobles on November 6th, 2015 3:30 PM

How Do Homeowners Accumulate Wealth?

Lawrence Yun for Forbes

The differences between buying and renting are massive.  According to the Federal Reserve, a typical homeowner’s net worth was $195,400, while that of renter’s was $5,400.  The data reflects 2013 and the next survey of household finances, which is conducted every three years, will be out in 2016.  Based on what has happened since 2013 and projecting a conservative assumption of what could happen next year to home prices if we see only 3% price growth, the wealth gap between homeowners and renters will widen even further. The Fed is likely to show a figure of $225,000 to $230,000 in median net worth for homeowners in 2016 and around $5,000 for renters. That is, a typical homeowner will be ahead of a typical renter by a multiple of 45 on a lifetime financial achievement scale.

Though there will always be discussion about whether to buy or rent, or whether the stock market offers a bigger return than real estate, the reality is that homeowners steadily build wealth.  The simplest math shouldn’t be overlooked. A vast majority of homebuyers take out a 30-year fixed rate mortgage to make a home purchase. After 30 years, there is no mortgage payment (nor rent payment). So the home price growth over that time period would be the equity that the homebuyer would have accumulated. For example, the median home price of a single-family dwelling in the U.S. thirty years ago in 1985 was $75,500. This year, it will be at least $220,000. That figure of $220,000 is the housing component of the person’s wealth. Even had home prices not risen, the person would still have $75,500 in wealth today – on top of not paying any further monthly mortgage after 30 years.

This simple example does not play out nearly as neatly in the real world, since people do not stay in one residence over the 30 year period. Almost all homeowners trade up, change neighborhoods, or move to a better school district at some point. However, they are able to make those residential relocations due to the housing equity accumulated, even over a shorter period, and can immediately apply that equity to the next home as a downpayment. Therefore the conditions of steadily building housing wealth still hold.

We also know that not everyone can or should be homeowners. The memories of easily accessible subprime mortgages and subsequent harsh foreclosure pains are still fresh, and remind us of the devastating impact on the families involved, local communities, and to the broad economy. In addition most young adults have not developed the financial standing or have found a stable, desirable career and, therefore, choose not be homeowners until later.  The homeownership rate among households under the age of 35 is 35% currently and rarely rises above 40% historically. For those under the age of 25, the current ownership rate is 23% and rarely rises above 25%. But the time will eventually come when people want to convert to ownership. By the time people are in their prime-earning years of 45-to-55, nearly three-fourths do eventually become homeowners. By retirement, nearly 80% are homeowners.

Read the rest of the article at Forbes > 

Lawrence Yun, PhD., Chief Economist and Senior Vice President

Lawrence Yun is Chief Economist and Senior Vice President of Research at NAR. He directs research activity for the association and regularly provides commentary on real estate market trends for its 1 million REALTOR® members.

Posted by Yates Nobles on October 24th, 2015 4:54 PM

by CateyHill

Smart Money -MarketWatch

Forget Williamsburg. These four retiree havens offer the same history and charm for far les
s.

Virginia is home of the "half backs" -- retirees from the north who tried out Florida, decided it wasn't for them, and then came halfway back up the coast.

With its lush landscapes, including the rolling Blue Ridge Mountains in the west and lovely coastline to the east, experts say it's easy to see why. And while Florida and other states to the south's hot and humid summers can be tough on the over-65 set, Virginia offers a comparatively milder climate all year round. Combine that with the state's plethora of recreational activities and urban amenities, and advisers say you have a retiree's paradise. "Virginia has a good climate, lots of colleges, beautiful natural scenery, and you can golf nine or 10 months of the year here," says Robert G. Topping, a financial adviser at Covenant Wealth Advisors in Williamsburg.

Virginia has its financial perks, too. The median home here goes for just $238,000, while state and local income taxes are below those the national average. Sales tax is about 5%, compared to 6.8% on average across the country. And while cost-of-living in the state in 8% above the national average, according to Sperling's Best Places, it's far less pricey than many states to the north. Retirees who are looking to continue working may also be in luck, as unemployment statewide is only about 6%.

As with any state, there are drawbacks. Millions of tourists descend on the state each year -- Virginia Beach has more than 5 million annually, while Colonial Williamsburg gets 1.7 million -- making some areas less than ideal for retirees seeking quiet golden years. On top of that, some of the most popular retirement spots are some of the state's least affordable. In Williamsburg, for instance, the median home price is $418,000 and the cost of living is 40.1% higher than the national average, according to Sperling's Best Places.

But that doesn't mean retirees can't find a beautiful beach community or mountain town without breaking the bank. With the help of financial advisers and natives of the Old Dominion State, SmartMoney.com identified four spots that have all the charm and natural beauty of historic Williamsburg, but at a fraction of the cost.

Roanoke: For the outdoorsman

Nestled in the southwest corner of the state amid the Blue Ridge Mountains, Roanoke offers some of Virginia's most beautiful landscapes, including breath-taking mountain views and wandering miles of rivers and creeks. The proximity to the mountains make Roanoke a hiker's haven, says Joyce E. Williams, a retired school administrator who lives in town. The Roanoke Appalachian Trail Club maintains more than 100 miles of trails in the area and there are also more than 20 miles of riverfront hiking and biking paths right in town. An hour's drive away is Smith Mountain Lake, which has 500 miles of shoreline and is popular among boaters. All this outdoor beauty comes at a significantly cheaper price than many mountain towns like Boulder, Colo., or Lake Tahoe: Retires will pay just $127,000 for the median home and the total cost of living is nearly 13% lower than average.

By the numbers

  • Population: 92,532
  • Median home cost: $127,700
  • Cost of living: 12.9% lower than average
  • Unemployment: 8.5%
  • Source: Sperling's Best Places

Cultural activities in Roanoke are a step above some other outdoorsy spots in the state, too, says Williams. In addition to the symphony, ballet and opera, Roanoke is home to the new Taubman Museum or Art -- designed by L.A. architect Randall Stout, who once studied under Frank Gehry. Exhibits in photography, painting and sculpture have attracted more than 300,000 visitors since the museum opened in late 2008.

But while Roanoke does have its share of museums and stores, some residents complain the shopping could be better (they hit up Richmond, about 2 ½ hours away, to get to more large department stores and other big-city shopping options). And the airport has direct flights to just nine cities.

Still, Roanoke offers retirees many opportunities to get involved in the community, Williams says. There a great number of neighborhood associations and retirement communities in the area that can help retirees easily integrate, she says. Volunteers can sign up with the well-regarded League of Older Americans, which helps disadvantaged seniors in the area or become a docent at the city's many museums.

Winchester: For the easygoing history buff

To understand the allure of Winchester, one must step back centuries. It was here that the Pennsylvania Quakers came to settle in 1732; here that George Washington had his first job, first military post, and first elected office; here that six Civil War battles were fought (the city was so important to both sides during the war that it changed hands more than 70 times during the conflict). And it is here that the history-loving retiree should consider settling, residents say.

By the numbers

  • Population: 26,265
  • Median home cost: $228,800
  • Cost of living: 14.8% higher than average
  • Unemployment: 6.8%
  • Source: Sperling's Best Places

One can easily get lost in retro-thought in the 45-block historic district, which is paved with old red-brick roads and dotted with landmark buildings from the 1800s. Many are drawn to the Old Court House Civil War Museum, built in 1840 that now features 3,000 artifacts and an exhibit of soldier-written graffiti. There is also the George Washington Office Museum, an 18th century building that's devoted to the first president's early years, and the Patsy Cline Historic House, the former residence of the legend country singer. "Lots of retirees volunteer to be docents at the many museums here," says Renee Bayliss, the visitor and community relations specialist for Winchester-Frederick County. 

By

Though retirees enjoy all of these historic offerings, some say the slower pace and affordable lifestyle are just as important. The town has dozens of restaurants and shops and even a few art galleries, but residents describe the surrounding area as rustic. "It's a small town with a rural countryside surrounding it," says Bayliff. And it's not only tiny, but it's pretty homogeneous -- nearly three in four residents are white, according to City-Data.com.

Charlottesville: For the academic-minded history buff

It's no accident we've put two towns known for their past on this list -- history is Virginia's lifeblood. But living in Charlottesville is quite different from living in Winchester, largely because it's home to the top-rated University of Virginia, which gives the town a livelier, younger feel.

By the numbers

  • Population: 40,762
  • Median home cost: $242,100
  • Cost of living: 7.7% higher than average
  • Unemployment: 6%
  • Source: Sperling's Best Places

This is a place where many retirees proudly keep up with their studies. UVA offers the Osher Lifelong Learning Institute with courses ranging from "21st Century Retirement: Strategies for Women" to "Mediation: Why It Works." There is also plenty of art and culture, says Brigitte Bélanger-Warner, the director of sales & marketing at the Charlottesville Albemarle Convention & Visitors Bureau, including annual opera and book festivals as well as a lively, eclectic music scene. Independent bookstores and coffee shops line the student-filled pedestrian mall downtown. And Charlottesville sits in an award-winning wine region, a fact Thomas Jefferson, who brought the first vines to the area, would surely be proud of, says Bélanger-Warner.

Charlottesville's historic claims to fame are Thomas Jefferson's Monticello estate and Ash Lawn-Highland, the home of James Monroe. The Rotunda, UVA's centerpiece, is a brick-and-white-columned building designed by Jefferson that is now a United Nations World Heritage site.

For the outdoors lover, the Shenandoah National Park is a popular spot for hikers (although the Skyline Drive -- which takes visitors through the park -- gets crowded in the summer and fall), as is the Appalachian Trail, which runs through the area. The artsy, youthful energy here mixes with history and the outdoors in a way that produces a unique retirement, Belanger-Warner adds. Charlottesville also has a major airport and two major hospitals.

Virginia Beach: For veterans who surf

Virginia Beach is a popular spot for active retirees, especially former members of the military, says Marc Davis, a spokesman for the city. (The area is home to five military bases and is next door to Norfolk's large naval base.) "We have one of the highest concentrations of military retirees in the country," he says.

By the numbers

  • Population: 431,155
  • Median home cost: $253,100
  • Cost of living: 14.6% higher than average
  • Unemployment: 6%
  • Source: Sperling's Best Places

Many retirees flock to the city's 35 miles of wide, white sandy shoreline and other natural wonders such as the Back Bay National Wildlife Refuge, with its thousands of acres of marsh and dunes. Hikers can walk through the trails along the waters in First Landing State Park, the most visited park in the state. And athletic retirees will find they're not alone. The area hosts the nation's longest running surf competition and Men's Health magazine ranked Virginia Beach as one of the fittest cities in America.

There is plenty to do beyond the beach. The heart of the city's entertainment is Town Center, a 17-city block area with shopping, restaurants, music venues and the Sandler Center for the Performing Arts. When the grandkids come to visit, take them to the Virginia Aquarium and Marine Science Center or the observation area in POW/MIA Flame of Hope Memorial Park, where they can watch fighter pilots do aerial acrobatics. But despite all these offerings, and its bustling Town Center, most of the city has a suburban feel, says Davis. "You can have a quiet retirement here but still have lots to do."

This beach-meets-city lifestyle brings one big downside: crowds, especially in the summer on weekends. Each year, roughly 5.5 million visitors spend the night in the area, says Davis. But retirees say they simply escape to the quieter suburbs to avoid the crowds. Escape is made easier by the fact that Virginia Beach has a large airport nearby.



Posted by Yates Nobles on October 24th, 2015 4:53 PM
Many of you know and love the downtown pedestrian mall and UVA and are as pleased as I to see the rapid upgrading of midtown Cville.  Yes, Midtown.  The West Main St area between the pedestrian mall and UVA hospital and The University.  Perfectly situated just above the historical Fifeville area, where authentic late 1800 - early 1900 homes have been and are being renovated.

It's not to late to find your home in this area before prices escalate further.  I would like to invite you to my Open House tomorrow, Sunday, September 6 from 1-4 pm  -
at 311 5th St SW.   
This is a remarkable listing.  For the price of a condo or a townhouse you can live in urban chic where you can walk from West Main to the Corner/UVA or downtown.  Charlottesville's European-style Main St Market is just around the corner!

This 1676 square foot home has a simple, elegant design with 3-tier dental work below its metal roof.  Inside there are 3 bedrooms, 2 1/2 baths, 10'ceilings, exposed brick walls, handsome old southern pine floors, and tall windows.  The living space is open from the front street side to the rear deck side.  From the deck you view a deep, peaceful fenced backyard with its majestic tall trees - both retreats from a busy day.  Or you could just enjoy this bastion in town all day and work or play at home.  Then with a short walk go for coffee or lunch.

Charlottesville estimates the date of this building as 1907, but there are several indications that the home is older.  At one time it was known as Bell's Store, and neighbors remember when it was a meeting place for the Masonic Lodge.

You can take your first tour of this home among featured listing on this website - MLS # 537162.  I hope to see you at Open House, or give me a call and I will take you on a personal tour.
Posted in:General
Posted by Yates Nobles on September 5th, 2015 9:35 PM

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