Financing is the key to affordability and that means that property appraisals will factor into most real estate sales.  In a residential sale, shortly after a contract is signed, an appraiser comes out to physically inspect the property.  Most appraisers use the Sales Comparison Approach to determine a value for the home which compares the home for sale to similar nearby homes that have already been sold.  This comparison includes factors such as lot size, livable square footage, style of house, and property condition along with amenities.

The new appraisal rules that recently went into effect, seem to be affecting valuations and delaying settlements.  In a recent article, the National Association of Realtors Chief Economist Lawrence Yun, stated that many appraisers are not distinguishing between traditional homes and distressed properties (such as foreclosures and short sales) in their property comparisons.  This is a major factor because distressed properties typically sell for 20% less than normal homes in the same area.  Another issue is that sometimes appraisers are hired from outside the area and have “little knowledge about the local real estate market,” according to Yun.  This can result in homes appraising for substantially less than they would if an appraiser familiar with the area evaluated the home.

Appraisals are also affecting the timeframe for loans to be closed.  When reviewing the loan the underwriter will scrutinize the appraisal and may request that a second appraisal be completed, costing the buyer more money and often postponing settlement.

This is especially important to First-Time Buyers thinking about taking advantage of the $8,000 Tax Credit.  Since time is of the essence to meet the November 30th deadline, any delay in settlement could result in a loss of this opportunity.

If you are thinking about buying a home, attend our FREE Home Buying Seminar and learn the process so that you can make good decisions.

Wishing you sunshine everyday and the home of your dreams,
Jeri

Despite all of the negative reports about the real estate market that we’ve all been hearing for nearly two years now, our local market is not doing that badly.  According to the Metropolitan Regional Information Systems (MRIS – our MLS) data for Baltimore County, housing inventory is down from last year and pending sales are up.  In fact, according to MRIS, in August 2008 there was a 10.4 months supply of homes and in August 2009 there was a 6.7 months supply.  Six months worth of inventory is considered a normal housing market.

This is very good news because real estate is all about supply and demand.  If less homes are listed each month and demand remains relatively the same has it has been over the last several months, we will begin to see a shift from a strong buyer market toward a normal market and a stabilization of prices.

The median sales price in Baltimore County is $225,000 which is down about 10% from last year and the average days on market is 114 which is slightly higher than last year’s 103 days before contract.  The statistics are similar for the Greater Metropolitan Area.

The percent of original list price received at sale is as follows:
          Anne Arundel County 91.3%
          Baltimore City 89.5%
          Baltimore County 92.5%
          Carroll County 92.2%
          Harford County 92.6%
          Howard County 94.1%

So there is good news on the housing front for those of us in this market.  Local employment remains strong, the school systems are still desirable, and foreclosure rates in Maryland are low compared to other parts of the country – all important factors that affect real estate.

If you are a First-Time Buyer and would like to learn the home buying process, attend our FREE Seminar.

Wishing you sunshine everyday and the home of your dreams,
Jeri

 

Over the last month, we realtors have been shouting from the rooftops that first-time buyers who are thinking about taking advantage of the $8,000 tax credit need to put a contract on a home now.  However, may of these folks seem to think that they have plenty of time to find a house and get the tax credit.

This idea could not be more WRONG!

Most lenders need 45 to 60 days to close a loan.  To be eligible for the tax credit, a buyer has to settle on a house by November 30th.  This means that a buyer has to find a home, have a contract on it and make loan application no later than October 15th in order for the lender to have enough time to get the loan done by the November 30th deadline.

What has my head spinning is that so many of the first-time buyers out there are telling their realtors that they want to start looking for a house in October.  That gives them two weeks to find the home of their dreams.  Is this a realistic timeframe?

If you are reading this blog and see yourself in this situation perhaps you should rethink your timeline and start house hunting today.  If you must postpone your search until October, here are a few things that you must start doing now so that you will be able to find a home in two weeks.

1. Get pre-approved by a reputable lender so that you know exactly what you can afford.
2. Make a list of locations/zip codes in which you will consider purchasing.
3. Make a list of your wants and needs.
4. Call a realtor and let him/her know that you are planning to purchase before October 15th.  Discuss your criteria for a home and allow the realtor to email you listings from the MLS that you can review.
5. Go on-line and start looking at homes in your price range and in the areas you are considering, so that you will have a very realistic understanding of what you can truly afford before you go out looking at houses.

On September 30th, Jesse and I are hosting a FREE Seminar for First-Time Homebuyers.  At the seminar, you will learn the entire home buying process and have the opportunity to talk with a mortgage specialist, so that you can leave the seminar with a pre-approval letter in hand.

We’d love to see you there because if you want to take advantage of this once-in-a-lifetime opportunity, we want to help make that happen for you.

Wishing you sunshine everyday and the home of your dreams,
Jeri

This week, it has become extremely obvious that a mortgage nightmare is just around the corner.  With the First-Time Buyer Tax Credit coming to an end on November 30^th, first-time buyers have decided to get off the fence and take advantage of this once-in-a-lifetime opportunity.  So here’s the problem that awaits us.

Already many lenders are taking more purchase loans than they can process on time.  CitiMortgage went from a two-day turn around time to an eight-day window almost overnight.  As more first-time buyers decide to purchase, this situation is only going to multiply.

So, what’s the problem you ask?  The fact that buyers must settle by November 30^th in order to be eligible for the $8,000 credit.  The fact that if lenders cannot get these loans through underwriting on time, many buyers could end up settling after the November 30^th deadline and losing out on the government incentive.

If you are a first-time buyer, what should you do?  Get out there and start house hunting right now – today, in fact.  Plan on having a contract on a home by the middle of September and choose a settlement date well in advance of November 30^th.

Time is running out!  Don’t get caught up in something that promises to be a mortgage nightmare.

On September 9^th, 7:00-8:00 p.m., we are hosting a FREE First-Time Buyer Seminar at SunTrust Bank, Mays Chapel Branch.  If you are thinking about buying a home, you should definitely attend this information-packed hour covering everything from getting pre-approved to writing an offer to settlement day.

We’d love to see you there and if you are reading this blog and thinking about whether or not to attend, consider this a personal invitation.  You don’t really have time to think anymore – it’s going to take determined action to get you into a home in time to be eligible for the tax credit – and we want to make that happen for you.

Looking for a bargain in this market to make the tax credit go further?  Check out our BEST BUYS!  Each week we scour the market and select 3 homes that we think are real deals.

Wondering if you should continue renting?  We’ll take a look at your situation and do a personal analysis for you.

Hope to see you at the seminar.

Wishing you sunshine everyday and the home of your dreams,
Jeri