place to hang art

Fireplace prep, wood and bug (yuck) tips from Pillar to Post Inspection Services and the Horticulture Dept. of  the University of Nebraska-Lincoln

The typical homeowner of 2010

Home buyers today have affirmed a long-term view of home ownership, the typical seller is experiencing positive returns and the vast majority of home owners see their property as a good investment, according to the latest consumer survey of home buyers and sellers.

The 2010 NAR Profile of Home Buyers and Sellers is the latest in a series of large national NAR surveys evaluating demographics, preferences, marketing and experiences of recent home buyers and sellers.

Although typical sellers had been in their previous home for eight years, up from seven years in the 2009 study, first-time buyers plan to stay for 10 years and repeat buyers plan to hold their property for 15 years.

Here are some highlights:

• The typical seller who purchased a home eight years ago experienced a median equity gain of $33,000, a 24% increase, while sellers who were in their homes for 11 to15 years saw a median gain of 40%.
• With #1 reason to buy a home being a good investment, the next biggest reasons for buying, identified by all home buyers, was a desire for a larger home, 9 percent; a change in family situation and the home buyer tax credit, 8%; a job-related move, 7%; and the affordability of homes, 6%. Twelve other categories were 5% or less.
• The number of first-time home buyers rose to a record high 50% of all home sales from 47% in the 2009 study, building on success of the home buyer tax credit which began in 2009.
• The profile shows the median age of first-time buyers was 30 and the median income was $59,900. The typical first-time buyer purchased a 1,540 square foot home costing $152,000, with 93% using the first-time buyer tax credit.
• 56% of entry level buyers financed their purchase with an FHA loan, while another 7% used the VA loan program. 42% said financing their first home was more difficult than expected and 9% had been rejected by a lender.
• 58% of all buyers are married couples, 20% are single women, 12% single men, 8% unmarried couples and 1% other.
• Buyers searched a median of 12 weeks and viewed 12 homes.
• The typical repeat buyer was 49 years old, earned $87,000 and purchased a 2,000 square foot home costing $215,000.
• The median age of home sellers was 49 and their income was $90,000. Sellers moved a median distance of 18 miles and their home was on the market for 8 weeks, down from 10 weeks in the 2009 survey. Half traded up in size, 28% bought a comparably sized home and 21% traded down.
• 64% of sellers chose their agent based on a referral or had used the same agent in the past. Reputation was the most important factor in choosing an agent, cited by 35% of respondents, followed by trustworthiness at 23%. 84% of sellers are likely to use the same agent again or recommend to others.
• Home buyers thought the most important services agents offer are helping find the right house, negotiating sales terms and price. Buyers also most commonly choose an agent based on a referral from a friend, neighbor or relative, with trustworthiness and reputation being the most important factors.
• Buyers use a wide variety of resources in searching for a home: 89% surf the Internet, 88% use real estate agents, 57% yard signs, 45 percent attend open houses and 36% look at print or newspaper ads. Although buyers also use other resources, they generally start the search process online and then contact an agent.
• Local metropolitan MLS websites were the most popular Internet resource, used by 59% of buyers; followed by Realtor.com, 45%; real estate company sites, 43%; real estate agent websites, 42%; other websites with real estate listings, 41%; and for-sale-by-owner sites, 15 percent; other categories were smaller.
• 77% of all buyers purchased a detached single-family home, 9% a condo, 8% a townhouse or rowhouse, and 6% some other kind of housing.
• Not surprisingly, for-sale-by-owner transactions reached a record low, accounting for 9% of sales in the 2010 study, down from 11% in 2009.
• The share of homes sold without professional representation has trended down since reaching a cyclical peak of 18% in 1997.

Source: NAR

Home values continue to rise which is good news for central Ohio. The average sale price for the first nine months of the year is $161,204 up 7.4 percent from the beginning of 2010 according to the Columbus Board of REALTORS®. 

There were fewer homes listed for sale last month than is customary for September. Over the last five years, there was an average of 3,710 homes added to the market during the month of September. However, last month only 2,997 residential homes were added to the already elevated inventory in central Ohio. 

Although slightly lower than August, the total residential listings in September (16,728) was still higher than it’s been since August of 2008 when the inventory level rose to 16,975. 

“Inventory levels had come down over the last year and a half – which is what we were working towards,” said Sue Lusk-Gleich, President of the Columbus Board of REALTORS®. “When inventory levels are too high, the increased competition forces some homeowners to sell at prices that are too low which in turn often affects the values of other neighboring homes.” 

“In order to re-balance the market, we either need the inventory to decrease or the number of buyers to increase. And since the tax credit incentives brought many buyers into the market earlier than we would have seen otherwise, we have a smaller pool of potential home buyers to absorb the inventory now.” 

Home sales were down 28.4 percent in September and the number of homes that went into contract was also down almost 25 percent which doesn’t bode went for October home sales. 

“When comparing sales figures to the previous year, we need to remember that home sales have been elevated since April of 2008 due to the tax credits,” adds Lusk-Gleich. “Even so, sales are still up four percent year to date.” 

The Columbus Board of REALTORS® Multiple Listing Service (MLS) serves all of Franklin, Delaware, Fayette, Madison, Morrow, Pickaway and Union Counties and parts of Champagne, Clark, Hocking, Licking, Fairfield, Knox,Logan, Marion, and Ross Counties.

taken from Columbus  Board of Realtors website

Home sales and prices up in August

Interest rates still low and the selection of homes plentiful 

August home sales in central Ohio were higher than the previous month and the average sale price of a home sold continues to rise. There were 1,605 homes sold in August which is 8.2 percent more homes sold than during the month of July. Home sales during the first eight months of the year are now 9.2 percent higher than the same period in 2009. 

“We saw a lull in housing activity after the tax credit expired which was not surprising given the frenzy of activity attributed to the generous tax credits for both first time and repeat buyers earlier this year,” said Sue Lusk-Gleich, President of the Columbus Board of REALTORS®. “This upswing in sales is a positive sign that our central Ohio housing market continues to strengthen.” 

The average sale price of a home has been inching back up this year from $145,993 in January to $169,959 in August. The average sale price year to date (January through August) is $161,645, which is 2.2 percent higher than one year ago. 

There were 3,700 homes listed for sale last month bringing the total number of homes for sale in central Ohio to nearly 17,000 which is 16.5 percent more homes than were on the market at the end of last summer. 

“With interest rates still so low and the selection of homes for sale so plentiful, any one who has an interest in buying a home should take a look at what’s available right now,” adds Lusk-Gleich.

taken from Columbus Board of Realtors website

We tend to like, and digest, ideas or arguments in list form. The following from the Wall Street Journal is easily digestible.

The Wall Street Journal, By Brett Arends

September 16, 2010

Enough with the doom and gloom about homeownership.

Sure, maybe there’s more pain to come in the housing market. But when Time magazine starts running covers that declare “Owning a home may no longer make economic sense,” it’s time to say: Enough is enough. This is what “capitulation” looks like. Everyone has given up.

After all, at the peak of the bubble five years ago, Time had a different take. “Home Sweet Home,” declared its cover then, as it celebrated the boom and asked: “Will your house make your rich?”

But it’s not enough just to be contrarian. So here are 10 reasons why it’s good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer’s market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We’re four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor’s Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it’s mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You’ll never catch the bottom. It doesn’t really matter so much in the long haul.

Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What’s not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won’t see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You’ll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you’ll get a tax break on capital gains–if any–when you sell. Sure, you’ll need to do your math. You’ll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

4. It’ll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You’ll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. “You can tell the ones that have been bought,” said my local guide. “They’ve painted the front door. It’s the first thing people do when they buy.” It was a small sign that said something big.

5. You’ll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you’re better off buying.

6. It offers some inflation protection. No, it’s not perfect. But studies by Professor Karl “Chip” Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That’s valuable inflation insurance, especially if you’re young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

7. It’s risk capital. No, your home isn’t the stock market and you shouldn’t view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.

8. It’s forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won’t. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn’t a cost. You’re just paying yourself by building equity. As a forced monthly saving, it’s a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That’s below last year’s peak, but well above typical levels, and enough for about a year’s worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slumpin western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the “glut” simply won’t matter: It’s concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won’t have any long-term impact on housing supply in your town.

We all know about the great interest rates. But here is another underliner. Had to do it.

Today’s mortgage interest rates may never be this good again

Today’s mortgage rates are at historic lows but history suggests they won’t stay there. Because home buyers may never see these rates again, they need to BUY NOW, says Marc Roth, president of Home Warranty of America.

In an article written for Business Week, Roth states, “If you want to buy a house, now is the time, and if you don’t act soon, you will regret it. Here’s why: historically low interest rates.”

According to Mortgage-X.com, the average mortgage interest rate in 1970 hovered around 7.25 percent. Shortly thereafter, it began crawling upward, landing near 10 percent in late 1973 and settling back to nine percent between 1974 and 1976. Although high by today’s standards, people in 1976 would have been happy with nine percent.

From 1977 to 1981, the 30-year fixed rate was near 18 percent. Rates jockeyed for several years, hitting 11 percent in the late 1980s before slowly declining in the 1990s.

Every quarter of a percent counts! On a $200,000 loan with a 10 percent interest rate, the monthly payment would be $1,755. With a 4.5 percent loan, the payment would be $1,013.

Take advantage of today’s 4.5 percent interest rates or it may be another 20 years before rates are this favorable again. Combine that with the reasonable home prices we are seeing today, and this era exemplifies what we mean by a “buyer’s market.”