Thursday, July 2, 2009

For Sale: 2BR/1BA Co-Op in Oakland Gardens, NY, $209,750

For Sale: 2BR/1BA Co-Op in Oakland Gardens, NY, $209,750

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New Programs Target Low-Income Buyers

New Programs Target Low-Income Buyers
Under the federal Neighborhood Stabilization Program, many new state and local initiatives are expected to roll out in the next few weeks that will help middle- and low-income families buy foreclosed homes in hard-hit neighborhoods.

In all, about $5 billion is available, including $50 million in technical assistance to get the programs up and running. Regulations limit participation to households earning no more than 120 percent of the median income with 25 percent of the money going to families earning less than half the median.

The funds must be used for primary residences in communities with the highest incidences of foreclosures and subprime loans. There also will be a lease-to-own program.

The Neighborhood Stabilization Program was authorized last summer, but it has been rolling out slowly because the volume of paperwork involved has stymied communities.

Source: CNNMoney.com, Les Christie (06/24/2009)

For Sale: 1BR/1BA Co-OGreat Neck in Great Neck, NY, $269,777

For Sale: 1BR/1BA Co-OGreat Neck in Great Neck, NY, $269,777

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NAR Gives to Foreclosure Prevention Programs

NAR Gives to Foreclosure Prevention Programs
The National Association of REALTORS® has awarded more than $682,000 to 25 local and state REALTOR® associations through its Foreclosure Prevention and Response grant program. The grants help REALTOR® boards develop and fund local foreclosure-prevention programs.

More than $3 million is available to state and local associations through the program to help REALTORS®, their clients, and communities nationwide resolve the growing foreclosure problem. Funds can be used to:
Give consumers foreclosure prevention information and financial counseling.
Educate and train REALTORS® about foreclosure prevention, short sales, and auctions.
Help Realtors® and their associations form partnerships and get more involved in their communities to address foreclosures and support local neighborhood stabilization efforts.

“REALTORS® build communities, and as the leading advocate for homeownership and housing issues, we believe that any family that loses its home to foreclosure is one family too many,” NAR President Charles McMillan says. “Foreclosures affect each community differently, which is why NAR is providing the Foreclosure Prevention and Response grants directly to local and state REALTOR® associations – so that they can develop unique, coordinated action plans to prevent foreclosures and minimize their adverse effects on the community.”

NAR has also developed a Foreclosure Prevention and Response Toolkit for local and state associations. This free online toolkit helps associations develop a local foreclosure response program and support the work of REALTORS® in the community. Toolkit resources include a list of training programs, government and other grant programs, and opportunities for community involvement and best practices, including developing community-wide strategies.

Additional information on the approved grants is available at www.realtor.org/foreclosure.
— NAR

For Sale: 1BR/1BA Co-Op in Bayside, NY, $244,750

For Sale: 1BR/1BA Co-Op in Bayside, NY, $244,750

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Failed Projects Turned Into Affordable Housing

Failed Projects Turned Into Affordable Housing
Expensive cities like New York and Seattle are trying to find ways to change failed luxury projects into affordable housing for families with moderate incomes.

Seattle has a measure on the ballot in the next election that would create a fund to buy market-rate real estate developments. New York is studying a plan to subsidize unsold or half-built apartments to make them affordable for families earning between $55,000 and $158,000,

Cities need affordable housing for teachers, police, and firefighters, says Alan Berube, research director of the Brookings Institution's metropolitan policy program.

Source: USA Today, Martha T. Moore (07/01/2009)

For Sale: 9+BR/9+BA Single Family House in Lattingtown, NY, $3,399,999

For Sale: 9+BR/9+BA Single Family House in Lattingtown, NY, $3,399,999

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Is Mortgage Forgiveness the Answer?

Is Mortgage Forgiveness the Answer?
Some housing experts say the next logical step for helping home owners with negative equity is loan forgiveness.

Home owners with no equity stake and no likelihood of having one anytime soon are increasingly likely to walk away. Some theorize that curbing that trend is the only thing that will stabilize the market.

The nonprofit Milken Institute has devised a plan that would use Fannie Mae to refinance underwater loans with government money. Under the plan, a private lender would provide the money for the value of the home and the U.S. Treasury would issue a second, interest-only loan for the portion of the current mortgage that is underwater. Every year the home owner keeps current with payments, the Treasury would forgive a portion of the loan.

The institute estimates that this would save 1.5 million homes from foreclosure or abandonment and cost taxpayers between $75 billion and $100 billion.

Ken Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at UC Berkeley, approves that plan, but urges returning some of the appreciation to the original lender as a reward for patience.

"The idea that these loans are worth face value is a fiction," says Richard Green, director of the USC Lusk Center for Real Estate. "If we don't deal with [reducing] the balances, we're not really dealing with the problem."

Source: Los Angeles Times, Tom Petruno (06/27/2009)

For Sale: 4BR/2BA Single Family House in Port Washington, NY, $599,000

For Sale: 4BR/2BA Single Family House in Port Washington, NY, $599,000

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Pending Home Sales Rise Again

Pending Home Sales Rise Again
Pending home sales show a sustained uptrend, rising for four consecutive months with very favorable housing affordability and a first-time buyer tax credit boosting activity, according to the National Association of REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in May, increased 0.1 percent to 90.7 from an upwardly revised reading of 90.6 in April, and is 6.7 percent higher than May 2008 when it was 85.0. The last time there were four consecutive monthly gains was in October 2004.

Lawrence Yun, NAR chief economist, cautions that there could be delays in the number of contracts that go to closing.

“Closed existing-home sales have improved but are coming in lower than expected because some contracts are delayed or falling through from the application of new appraisal rules for many transactions,” he says. “Rises in contract activity show buyers are becoming more active even as they face much more stringent loan underwriting standards. Speedy clarification of the appraisal rules could smooth a housing market recovery and support the overall economy.”

Region
Northeast: The Pending Home Sales Index in the Northeast rose 3.1 percent to 80.9 in May and is 6.8 percent above a year ago.
Midwest : In the Midwest, the index slipped 1.3 percent to 89.2 but is 11.4 percent above May 2008.
South: The index in the South declined 1.7 percent to 92.6 in May but is 7.9 percent higher than a year ago.
West: In the West, the index rose 2.2 percent to 96.9 and is 0.7 percent above May 2008.

The Effects of Appraisals
NAR President Charles McMillan says the appraisal issue is complicated. “We see that distressed homes often are selling for 20 percent less than normal homes in the same area, but some appraisals don’t distinguish between traditional homes and distressed property,” he says. “In many cases appraisers from outside the area are being used, but as everyone knows real estate is local and appraisals should be done by an expert with local expertise.”

McMillan says sellers shouldn’t hesitate to speak with an appraiser about their home. “Sellers should feel free to tell an appraiser about improvements and renovations to their home, and how it compares with other homes in the neighborhood,” he adds.

“Also, if recent sales in the neighborhood were discounted, but not similar to your home in terms of quality or condition, that should be pointed out. It wouldn’t hurt to put all this in writing, especially if an appraiser is not familiar with your area. "

Affordability at a high
NAR’s Housing Affordability Index remains at historic highs. The affordability index fell to 171.6 in May from an upwardly revised 178.8 in April, which was the highest on record dating back to 1970. “Under these conditions the typical family would devote only 14.6 percent of gross income to mortgage principal and interest, which is one of the lowest percentages on record,” Yun says.

The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates, and family income.

A median-income family, earning $60,800, could afford a home costing $296,700 in May with a 20 percent down payment, assuming 25 percent of gross income is devoted to mortgage principal and interest. Affordability conditions for first-time buyers with the same income and small down payments are roughly 80 percent of what a median-income family can afford. The affordable price was significantly higher than the median existing single-family home price in May, which was $172,900.

First-time buyer tax credits offers a boost
The first-time buyer tax credit also is benefiting the market. “Strong activity by entry-level buyers is helping to absorb inventory and allow some existing owners to make a trade,” Yun says

Existing-home sales should trend up through the end of the year, with normal local market differences. “The big question is how much the appraisal issue will impact the ability of contracts to go to closing,” Yun says. “We are currently conducting a study to assess the degree to which new appraisal rules are impacting home sales.”

— NAR

5 Ways to Expedite a Sale

5 Ways to Expedite a Sale
Selling a home quickly remains a challenge in many markets across the country. Heidi Cole, an associate with the Corcoran Group in Palm Beach, Fla., offers this advice for anyone who wants to expedite a sale:
Cut the asking price to 10 percent to 15 percent below what comparable properties in the neighborhood are selling for.
Spruce up the outside. Update the landscaping. Power-wash the exterior and paint the door.
Appeal to first-time buyers. Advertise on younger consumers' favorite Web sites, such as Facebook and Twitter. Hire a photographer to shoot the house with a wide-angle lens so the rooms look bigger in online photos.
Price the house in the lower end of the range. A $299,000 house is in the high end of the $250,000 to $300,000 range but a $301,000 home is in the low-end of the $300,000 to $400,000 range.
Do what you can to make the deal close quickly. Be ready to move, offer to pay part of the closing costs, and/or throw in a year’s worth of association fees.

Source: Money Magazine, Beth Braverman (06/30/2009)

For Sale: 2BR/1BA Co-Op in Oakland Gardens, NY, $209,750

For Sale: 2BR/1BA Co-Op in Oakland Gardens, NY, $209,750

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