These policies pay you directly upon the sale of your home if the equity declines below the local house price index (FHFA) from the time of purchase.  Naturally all these policies have fine print and terms.

The terms and condition’s of these polices vary, but most protect for at least fifteen years and require an arms length transaction.  There is a twenty four month waiting period before you could collect on any loss at the time of sale.  These policies also vary in cost and the how they’re paid.  Here’s a link to a “Questions and Answers” page of one such company. 

Price protection policies are new to the market and I’m going to monitor their demand and success closely.

I strongly feel if you hire a professional realtor who knows the current market and its corresponding data will do more to secure your investment than any price protection policy can ever accomplish!

Call me if you have any questions or want to discuss real estate!

Since 1966, the median price of an existing single family home in the  U.S. has varied between 150% and 251% of personal income per household.  However, roughly three-quarters of the time it has been in a relatively narrow band between 185% and 230%. In September 2011, the ratio was just 153%, implying that to get back to an average price to income ratio, home prices would have to rise by about 27%.”

During the week of October 7, Freddie Mac reported that mortgage rates  had fallen to an average annual level of 3.94%. Assuming the use of a fixed  rate mortgage with 20% down, this would make the median mortgage payment on a single family existing home just 6.9% of per household personal income, compared with an average of 14.4% since 1966.”

The numbers on housing have an important message for American families today, and particularly younger families setting out on life’s great adventure: Five years ago, at the peak of  the home-buying euphoria, it was emphatically a time to rent. Today, when home  ownership is depreciated more than ever before, the numbers tell us it is a  time to buy!

The information I used for this blog was based in part on a story J.P. Morgan published.  If you want to read the report in its entirety please click on this link.  Market Insights!

Appraisers will now follow something called UAD
– Uniform Appraisal Dataset.  Appraisers will now be required to collect a  lot more information about a home’s features and upgrades for all new appraisals.  Appraisers will also need the date of any major renovations.   They’ll need photos, a description and date of renovation underneath each
photo, and more.

Where will the appraisers get this information?   FMLS, which means it’s going to fall back on the listing agent.   It’s going to be a challenge for agents and homeowners to be pro-active in understanding the new UAD guidelines.

Another major change is the way in which an appraiser can weigh the difference in value between a remodel vs. update.  I see a lot of agents advertising “remodeled”, but in reality, many of these homes have been “updated”.  I don’t want to sell updates short.   They’re essential in today’s market; however new granite counter tops and  stainless appliances isn’t a remodel if the rest of the kitchen is 15 to 20  years old.  It’s an update!  After 15 or 20 years, counter tops and  appliances wear out.  Let’s face it, they have to be replaced. The  definition of a “remodel” is a kitchen that has new cabinets, backsplash, counter tops, appliances, fixtures and floors in some cases. It has to look  like it was totally re-done with a fresh new look top to bottom. In other  words,  it has to have a wow factor.  The same holds true for  baths, basements, decks or additions.   Things like roofs, siding and HV/AC units will also be valued by the age.  Bottom line, more individual items in your home will be weighed and valued than in the past.  Some will help your home’s value and some will not.

My message to you is that an appraiser may not give you value for “updates”, while a buyer will give you higher consideration for them,  but “remodels” will increase your home’s overall value and buyer consideration.

If you have a home for sale you need to be sure you have at least 25 professionally shot photos with descriptions underneath. As an agent who understands the market, having a professional photographer on call is a necessity. I’m surprised how many terrible photos agents post of a property.  Show me a home with poorly shot photos and I can show you an agent that doesn’t know a thing about marketing!
Years ago it used to be all about the size of a yard sign; today it’s all about the quality of photos!  With the new appraisal requirements, well shot pictures of your home may have never been more important in your home selling and appraisal process!

Contact me if you have any questions about the new UAD guidelines for appraisals!  I would be glad to discuss how the changes may relate to you and your home.

Low mortgage rates are terrific — if you can get them.

One week after posting its lowest mortgage rate in 50 years, Freddie Mac reports that the 30-year fixed rate mortgage rose by an average of 7 basis points nationwide this week to 4.22%. To get the rate, you’ll pay an average of 0.7 “points”.

This week’s rise in the 30-year fixed rate mortgage pulled rates off their all-time lows so either you locked last week’s rock-bottom rates, or you missed it.  Mortgage rates are rising.

As a refinancing homeowner or home buyer in Atlanta , rising mortgage rates are something to watch. This is because, as mortgage rates rise, so do the long-term interest costs of giving a mortgage, increasing your homeownership costs.

For example, if you failed to lock a rate last week when rates were bottomed, and then decided to lock-in only after rates had climbed 0.25 percent, at the new, higher rate, over the life of your loan, you would have responsibility for an extra $5,300 in interest costs for every $100,000 you borrowed.

Rising mortgage rates can be expensive.  For home buyers, rising mortgage rates pose a second problem — they erode your purchasing power. A home that fits your budget at today’s rates may not fit your budget at next week’s rates. And because mortgage rates change quickly, you can sometimes feel like you’re racing the clock.

The hard part about mortgage rates, though, is that we can never know what they’ll do next. On some days they rise, on some days they fall, and on some days they stay the same. Instead of trying to “time the bottom”, therefore, a good strategy can be to lock the first, low rate that fits your budget. Then, if rates are lower in the future, you can look to refinance at that time.

Mortgage rates remain at historical lows. It’s a good time to lock a rate.

In this day and time this is an awesome achievement for any city government. Max will be up for re-election soon. This will be his 8th term. I see no need to fix something that isn’t broken. Please get out and vote November 8th.

Maybe Max should run for president!

Very few cities have the jobs or opportunities like Atlanta.

We all hear a lot about bankruptcy today.  Unfortunately many of us know of someone that had to file.  It’s a practice most people don’t fully understand.  I told someone not long ago it dated back to when Columbus landed, but after some research I actually found it’s a more historic practice.  Did you know bankruptcy is part of The Constitution of The United States and grants Congress the power to make or change bankruptcy laws?  I was very surprised to find that bankruptcy actually dates back to the Old Testament when creditors were commanded to forgive debts every seven years.  The term “bankruptcy” comes from the Italian word “banca rotta” which translates to “broken bench” and refers to the practice of destroying a debtor’s trading bench when he could not pay his debts.  The earliest laws regarding bankruptcy were placed in effect in England in 1542, providing creditor protection by making the nonpayment of debts a criminal offense.  Laws were changed in the 1700s that provided protection for debtors by allowing the discharge of certain debts.  Some of today’s bankruptcy laws still follow these ancent guidelines.

Home resale rose 4 percent last month, according to the March Existing Home Sales report.  A total of 5.1 million homes were sold on a annualized, seasonally-adjusted basis.

The strong results re-established the national, long term trend toward rising home re-resales.

March marked the 6th month out of eight in which sales volume has increased and sales are up 32 percent from July 2010 lows. 

At the current rate of sale, the entire home resale inventory would be depleted in 8.4 months.  This is 01 months faster as compared to February, and a full month faster than the 12 month average.

The Existing Home Sales report also included a breakdown by buyer type

• First-time buyers bought 33% of homes, down from 34% in February.
• Repeat buyers bought 45% of homes, down from 47% in February.
• Investors bought 22% of the homes, up from 19% in February.

35 percent of buyers paid in cash.

And, perhaps most noteworthy, according to the Naional Association of Realtors 40 percent of March home re-sale were “distressed homes include foreclosures, short sales, and REO and typically sell at discounts “in the vicinity of 20 percent”

Home prices in Atlanta are based in the bacis economic theory of Supply and Demand.  So, with home supplies dropping and demand for home rising, it’s reasonable to expect home values to rise later this year.

If you’re in the market for a home play the recent trends to you advantage.  Today, homes are affordable and mortgages rates are low.  This may not be the case later this year.  The best “deal” of the year may be what you buy now.