Blog - Leagan Realty

Pending Home Sales Post 20th Consecutive Month Of Annual Gains

January 29, 2013 by lizlaurenb

The National Association of REALTORS® (NAR) reports that the Pending Home Sales Index fell 4.3 percent in December as compared to the month prior. The index now reads 101.7.

The Pending Home Sales Index measures the number of U.S. homes that have gone “into contract”, but have not yet closed. The report is based on data collected from local real estate associations, and from national brokers.

Despite December’s drop, however, the annual rate at which contracts for a home purchase were drawn increased 6.9 percent from one year ago, and marked the 20th consecutive month of annual purchase contract gains.

NAR reports that 80% of homes under contract are closed with 60 days, with the majority of the remained homes “sold” within months 3 and 4.

Analysts believe that December’s Pending Home Sales Index drop is not a result of a weakening housing market. Rather, it’s a function of a falling national home supply; in particular, a shortage of homes in the West Region offered a prices under $100,000.

The national housing inventory is currently at an 11-year low. However, regionally, results varied :

Northwest : -5.4 percent from November; +8.4 percent from one year ago
Midwest : +0.9 percent from November; +14.4 percent from one year ago
South : -4.5 percent from November; +10.1 percent from one year ago
West: -8.2 percent from November; -5.3 percent from one year ago

Although December’s Pending Home Sales Index dropped as compared to November, the year-to-year growth of pending home sales suggests a broader improvement in the U.S. housing market. Furthermore, the index is a strong indicator of existing home sales, which means that this season’s home sales should outpace those from 2012.

The Pending Home Sales Index is bench-marked to 100, the value from 2001, which was the index’s first year of existence. 2001 was considered a strong year for the housing market so last month’s 101.7 is considered a positive measure for the housing market.

Analysts project a strong Spring market in Scottsdale and nationwide.

What’s Ahead For Mortgage Rates This Week : January 28, 2013

January 28, 2013 by lizlaurenb

FOMC meeting this week Mortgage rates rose last week as investors gained confidence in the global economy. China and Europe posted better-than-expected manufacturing rates, U.S. Jobless Claims fell for the second straight week, and the worst of the European debt crisis appears to have passed.

Last week’s economic news provided further evidence of a strengthening U.S. economy.

The National Association of REALTORS® released its Existing Home Sales report, which indicates that existing home sales improved by 13 percent on a year-over-year basis and are now at their highest point since 2007. The group expects sales of existing homes to increase by 9 percent in 2013.

The Commerce Department released its monthly New Home Sales report; while new home sales for December fell short of Wall Street’s expectations, sales of new homes are almost 20 percent higher than they were one year ago.

Growing demand for homes coupled with lower inventories of available homes suggests that the days of rock-bottom home prices and low mortgage rates are dwindling.

According to Freddie Mac, the average mortgage rate for a 30-year fixed rate loan was 3.42 percent with borrowers paying 0.7 percent in discount points plus closing costs. The average rate for a 15- year fixed rate mortgage was 2.71 percent with borrowers paying 0.7 percent in discount points plus closing costs.

While slight, the week-over-week increase in mortgage rates in Scottsdale could become a trend.

Weekly Jobless Claims fell below Wall Street forecasts for the second week in a row. 330,000 new jobless claims were filed; far fewer new claims were filed than the 360,000 new jobless claims expected by investors. New jobless claims also fell below the prior week’s 335,000 new jobless claims. Fewer jobless claims are a sign of a stabilizing economy.

Mortgage rates typically rise as investors gain confidence in the economy and financial markets.

This week’s economic news calendar is jam-packed.

Investors await the outcome of the Federal Open Market Committee’s first scheduled meeting of 2013, treasury auctions are scheduled for Tuesday, Wednesday and Thursday, and the Pending Home Sales Index will be released.

Plus, the Department of Labor’s Non-farm Payrolls Report and Unemployment Report will be released Friday morning.

Reasons To Attend Your Own Home Inspection

January 25, 2013 by lizlaurenb

Be present for your home inspection As a home buyer in Scottsdale , you can get a feel for whether a home’s systems and appliances are in working order. However, you can’t know for certain until after the home’s been inspected.

This is why real estate agents recommend that buyers hire a licensed home inspectors immediately after going into contract. It’s the best way to really know the home which you’re buying.

By definition, a home inspection is a top-to-bottom check-up of a home’s physical condition and systems, including a review of the structure, and its plumbing and electrical systems. Home inspections are not the same as a home appraisal, which is a valuation of the property.

When you commission a home inspection, you should be present for it. Here are 3 reasons why :

Seeing For Yourself
There’s a big difference between reading a report and seeing “live” what may be right or wrong with a home. With first-hand knowledge of a potential issue, you’ll be in a better position to determine whether a problem warrants contract cancellation, or whether it’s an additional negotiation point.

Discovering The Home
Via a home inspection, you will learn where the systems reside within a home (e.g.; boiler room, garage), and how to operate them. This is a valuable educational opportunity and most inspectors are happy to share what they know. It’s also a chance to ask questions about maintenance and upkeep.

Better Understanding
A home inspector’s job is to review and disclose the condition of the home. The inspector’s report, however, is just a summary on paper. In being present for the inspection, a buyer will be able to visualize and understand the report’s conclusions more clearly. This can make for more effective re-negotiations with the seller, in the event that damage or distress is identified.

So, what should you do during the home inspection? Your primary tasks are to watch, listen, learn and ask questions. A professional home inspector will welcome your participation in the process.

Existing Homes For Sale At Lowest Point In 11 Years

January 24, 2013 by lizlaurenb

Existing Home Supply Home sales dropped last month, but not because demand was lacking. There are fewer homes for sale than at any time in the last 11 years.

According to the National Association of REALTORS®, Existing Home Sales for December 2012 fell to a seasonally-adjusted, annualized rate of 4.94 million homes from November’s tally of 4.99 million existing homes.

The Existing Home Sales report is based on the number of closings for previously-owned, single-family homes, townhomes, condominiums and co-ops. It’s estimated that existing homes account for 85 to 90 percent of all home sales nationwide.

2012 was a good year for housing. Sales of existing homes climbed 12.8 percent as compared to the December 2011 tally, which may be a strong indicator of future mortgage originations and short-term demand for home-related goods.

Based on preliminary sales figures, the number of home resales in 2012 grew 9.2 percent to 4.65 million homes as compared to 4.26 million homes sold during 2011. This marks the highest number of home resales sold in 5 years — a time which predates the recession of last decade.

In addition, the median price of a homes resale read $180,800 in December, which is a 11.5 percent increase as compared to December 2011, and the tenth consecutive month of year-over-year median price growth.

Not since November 2005 has the median home resale price climbed this quickly

Furthermore, the supply of existing homes fell to 4.4 months in December, down 0.4 months from November. At the current pace of sales, the national home resale inventory will be sold by June. This is an important statistic because home supply of less than 6.0-months is thought to represent a “seller’s market”.

There are also just 1.82 million existing homes for sale nationwide — the fewest since January 2001, and a 22 percent reduction from one year ago. With buyer demand high and home inventory down, home prices are likely to rise in Scottsdale and nationwide throughout 2013.

Buying A Home In A Golf Community

January 23, 2013 by lizlaurenb

Golf course communities It’s January, but home sales in golf communities remain strong like in the rest of the country.

If you’re looking to buy a home in a golf course community, either as a primary residence or as a vacation or retirement home, there are additional home traits which make buying on a golf course different from buying a typical Scottsdale single-family residence.

Here is a quick primer of home characteristics to consider when buying in a golf community.

Land Plot
When looking at homes within a golf course community, be aware of its location with respect to the community entrance. Homes nearest to the entrance will receive the most drive-by traffic and may be slightly more noisy that a home which is situated far from the entrance. However, homes close to the entrance will also be more navigable for visitors.

Security
How security-conscious is the community? Golf course communities tend to be gated communities but each will have varying levels of security. Some will have 24-hour gatepersons to manage and monitor traffic into the community. Others will use a pass-key system. Determine what’s most important to you.

Proximity To Golf Course
Consider the physical location of the home relative to the golf course(s). Homes which are situated near tee boxes are less likely to be struck by errant golf shots, but may be louder because of chatty players. Homes off the golf course are typically free of all such hazard.

Amenities
Many golf communities feature amenities such as swimming pools, exercise facilities, and clubhouses. Some have tennis courts and other recreational outlets. Do these services require extra fees? Is there a mandatory membership cost, with minimum monthly purchase levels? Be sure to ask.

Association Dues And Restrictions
As with most planned community/association, golf communities typically require annual or monthly membership dues; and publish a list of rules by which homeowners must abide. For example, home improvements may be restricted by the rules of the community. Before buying, review the association by-laws carefully.

Golf course communities are a terrific way for golf enthusiasts play (nearly) year-round, and can provide a terrific lifestyle even beyond the golf game. If you plan to buy in a golf community, use the tips above to help with your research.

Then, when you’re ready, talk to a real estate professional for help with your purchase.

Tips For Selling Your Home In The Colder Winter Months

January 22, 2013 by lizlaurenb

Shovel snow on the walkways Real estate agents will tell you that it can be harder to sell a home in the winter. The days are colder and shorter, leaving less time to show a home to potential buyers.

The good news, though, is that most buyers looking at houses in the winter aren’t just killing time. They’re serious enough about finding a new home to house hunt at a time when most people might rather stay inside.

There are a several steps you can take to make a good impression on home buyers this winter.

First, if there’s snow or ice on the ground, make sure walkways are safe. Spread out ice melt or sand to provide traction during snowy weather. Shovel the snow on the driveway and sidewalks to make your home more inviting. Be sure to place a mat on which for visitors to wipe their feet.

Second, warm up the house. Buyers will remember the house that was pleasantly warm on a frigid day. This also demonstrates to buyers that your furnace is in good working order.

Next, to make a “welcoming scent”, bake cookies the day of the showing. Some people are sensitive to the fragrances in air fresheners and perfumes, so skip spraying those when expecting someone to look at your house.

You can also serve snacks in the kitchen. Give the buyer a reason to linger in your home by leaving a light snack in the kitchen. If the weather is cold, consider providing chili or soup in a crock-pot to keep it warm with festive disposable bowls. Or, to keep it simple, you can provide coffee or hot chocolate and cookies.

Lastly, to make your house appear warm and inviting during cold winter months, turn all the lights in the house on; place warm-toned throws and decorator pillows around the living room. Play soothing classical or jazz music; keep the volume low enough that buyers can talk quietly to each other.

These techniques each can help your home seem more inviting this winter.

Simple Fixes To Help Your Home Sell More Quickly

January 18, 2013 by lizlaurenb

For sale sign If one of your New Year’s Resolutions is to sell your Scottsdale home, there are a few simple steps you can take to help prepare it for showings.

With a prospective buyer in mind, take a tour of your home, making a list of the good, the bad, and the not-so-bad. You may spot areas in need of major renovation; and areas which could benefit from just a basic touch-up.

It’s these latter areas which will likely yield the biggest return on your investment so, in preparation for making your home “buyer ready”, consider these steps.

Landscaping
The first thing a buyer will notice is the outside of your home. Sometimes called “curb appeal”, first impressions are very important to the sale of your home. Therefore, be sure to trim bushes, rake leaves, and clean up the yard in order to make your house seem more inviting. Clear unnecessary clutter from the yard and walkway to your home.

Bedrooms
Paint the walls of the room a light, neutral color to “open up” the space. Replace old light fixtures with new modern ones; replace all old bulbs; and consider adding a ceiling fan to each bedroom. This can increase the room’s appeal.

Bathrooms
If your tub has seen better days, have it resurfaced. Remove mildew stains in, or around, baths and showers. Replace stained silicone seal and grout, where needed. Check all light fixtures for burned out bulbs. Add lighting, if necessary, to make the bathroom brighter.

Kitchen
Your kitchen might also benefit from sprucing up. Do not gut-renovate your kitchen. Rather, refinish or paint its cabinets. Install new, clean-looking handles. Add a new back splash, if you think it will help.

You’ll spend a small sum to make these improvements but the rewards can be more home showings, which can lead to more home offers, which can help you get the price you want for your property.

Your home may also sell more quickly.

Homebuilder Confidence Nearly Triples In 2 Years

January 17, 2013 by lizlaurenb

NAHB HMI January 2013 The National Association of Homebuilders (NAHB) Housing Market Index ended its 8-month winning streak this month, posting a value of 47. The January 2013 reading is on level with last month, and remains at a near 7-year high.

The Housing Market Index (HMI) is a measure of home builder confidence.

HMI readings below 50 indicate a “poor” new construction conditions for single-family homes nationwide; ratings above 50 signal “good” ones.

Not since April 2006 has the Housing Market Index crossed into “good” territory, but the past two years have witnessed the HMI nearly triple; and the index is up from a reading of 25 just twelve months ago.

Values would have likely increased this month, too, if not for builder uncertainty. The NAHB cites concern over prolonged legislative decisions as contributing factors to this month’s builder confidence reading. Specifically, the trade group expressed concern over the future of the federal income tax deduction for home mortgage interest and spending cuts related to the recent, so-called “fiscal cliff”.

As compared to the month prior, this month’s HMI showed the following :

Current housing conditions were mostly unchanged between December and January
Sales expectations the next six months dropped slightly between December and January
Prospective home buyer foot traffic increased slightly between December and January

January marks the tenth consecutive month through which buyer foot traffic has increased. Foot traffic is now at its highest level in nearly 7 years.

The NAHB Housing Market Index suggests a slow, steady rise in confidence among the nation’s home builders. This is occurring, in part, because of improving housing market conditions both nationally and regionally. Another factor is rising confidence among today’s home buyers.

Home sale prices Scottsdale remain relatively low and mortgage rates sit below 4 percent. With demand for homes growing, prices are expected to rise. Home buyers this season may be more likely to get a good “deal” than the buyers of spring or summer.

Improve Your Credit Score To Get Better Mortgage Rates

January 16, 2013 by lizlaurenb

Credit score FICO improvement For home buyers in Scottsdale and nationwide, credit scores can change low mortgage rates and alter home loan approvals.

Borrowers with high credit scores get access to lower mortgage rates, for example, and can find the mortgage approval process to be more smooth that borrowers with low credit scores.

If your credit score is low, here are some basic ways to help improve it.

Get The Reports
Download an updated version of your credit report from each of the three major reporting bureaus — Equifax, Experian and TransUnion. The reports may mirror each other, but credit accounts — especially derogatory ones — sometimes don’t appear on all three. Ordering reports from all three bureaus is a safety step. Note that the credit bureaus each use different scoring models so your credit scores will vary.

Check For Errors
Yes, credit reports can have errors in them. Should you find any items on any of the three credit reports which, in your opinion, do not belong or are erroneous, contact the credit bureau regarding removal. Errors on a credit report must be addressed with each bureau individually.

Pay Up
Or, rather, pay down. Be diligent about paying down your credit card balances in order to lower the percentage of your credit line(s) in use. In general, aim for a 30% ratio or less. An added benefit of paying down debt is that it can lower your total monthly debt load, which can increase your maximum home purchase price.

For items which are harming your score, such as a 30-day or 60-day mortgage late payments, medical collection items, and/or judgments, consider writing a brief letter which explains the circumstance of the derogatory credit event. Such a letter won’t help your score to improve, but it can help your lender to make better credit decisions, which can aid in “exceptions”, if required.

Making even minor changes to an overall credit profile can yield measurable long-term results. It can also result in lower mortgage rates.

What’s Ahead For Mortgage Rates This Week : January 14, 2013

January 14, 2013 by lizlaurenb

30-year mortgage rates Mortgage rates rose last week nationwide during a week of sparse economic news.

Thursday’s weekly jobless claims report showed 371,000 new claims, which was 1,000 fewer jobless claims than for the prior week. Wall Street expectations of 365,000 new jobless claims turned out to be too optimistic.

The semi-quarterly statement released Thursday by the European Central Bank (ECB) announced that the region’s inflation remains below its 2 percent ceiling as established by central banker. Economic weakness in the Eurozone is expected to persist into 2013 with signs of recovery becoming evident toward the end of this year.

ECB cited financial and structural reforms as essential to economic recovery, and noted that national governments within the Eurozone have been slow to implement such reforms. Without such reforms, Euro-area economies may continue to struggle, which would likely lead investors to seek a safe haven in the bond market, moving bond prices higher.

As bond prices rise, mortgage rates in Chicago and nationwide typically fall.

Also last week, Freddie Mac’s Primary Mortgage Market Survey reported the average rate for a 30-year fixed rate mortgage rising from 3.34 percent to 3.40 percent for buyers paying 0.7 percent in discount points plus closing costs. The average rate for a 15-year fixed rate mortgage rose from 2.64 percent to 2.66 percent.

Required discount points for the 15-year fixed rate mortgage rose from 0.6 to 0.7 percent.

Import prices for December released Friday were reported at -0.1 percent, below the consensus estimate of +0.1 percent. This report measures the prices of goods purchased in the U.S, but produced abroad and is considered an important indicator of inflationary trends affecting internationally produced goods.

Inflation tends to harm mortgage rates.

Next week’s economic calendar is full of economic data and includes the release of the Producers Price Index (PPI), Retail Sales figures, the Consumer Price Index (CPI). The Fed is also set to issue its Beige Book report, and the NAHB Housing Market Index and Consumer Sentiment report will be released.

Mortgage rates remain low, but are rising.