CHICAGO – Sept. 28, 2009 – It’s not too late for a determined first-time home buyer to take advantage of the $8,000 federal tax credit, which expires Nov. 30.
Scott Voak, a San Diego practitioner specializing in first-time buyers, helps potential buyers target homes that can close quickly. To identify those properties without touring them, he suggests contacting the listing agent with blunt but important questions that aren’t usually addressed in the listing. These can include:
• Is there mold?
• Does the home need extensive repairs?
• Does the home have aging systems or appliances?
• Are there any troublesome neighbors?
Buyers should factor in these questions before making an offer:
• How long has the property been on the market?
• Have there been any price reductions?
• Are there any offers written on the property?
• Do the home owners need to move by a specific date?
Other recommendations include:
• Provide buyers with as much information about financing as possible.
• Encourage buyers to begin the process right away.
• Make sure buyers understand who is responsible for closing costs.
Monday, September 28, 2009
New U.S. home sales rise 0.7 percent in August
WASHINGTON (AP) – Sept. 25, 2009 – New U.S. home sales posted a tepid 0.7 percent increase last month, missing Wall Street expectations and providing more evidence that the housing market recovery remains tentative.
The Commerce Department said Friday sales inched up to a seasonally adjusted annual rate of 429,000 from a downwardly revised 426,000 in July. Economists surveyed by Thomson Reuters had expected a pace of 440,000.
While it was the fifth straight increase and the strongest report in 11 months, sales were 4.3 percent lower than the same month last year. Sales have risen 30 percent from the bottom in January, but are off about 70 percent from the peak of four years ago.
The report was the second straight disappointing sign for the U.S. housing market, which is struggling to emerge from the most severe bust in generations. On Thursday, the National Association of Realtors said sales of previously occupied homes, which make up the bulk of the market, dipped 2.7 percent last month.
While August’s housing reports have been disappointing, “we believe both remain on an upward trend,” wrote David Resler, chief economist with Nomura Securities.
Builders continue to make severe cuts in prices to attract buyers. The median sales price of $195,200 was off 11.7 percent from $221,000 a year earlier, and 9.5 percent below July’s level of $215,600. That was the largest monthly drop on records dating to 1963.
There were 262,000 new homes for sale at the end of August, down more than 3 percent from July and the lowest in nearly 17 years. At the current sales pace, that represents 7.3 months of supply – the smallest amount since early 2007. The decline means builders have scaled back construction to the point where supply and demand are coming into balance.
Still, it’s taking more than a year to sell the homes on the market.
“No one ever said that the homebuilders were breaking out the bubbly and party hats and doing the cha-cha around town,” wrote Jennifer Lee, economist with BMO Capital Markets.
Buyers, meanwhile, are rushing to take advantage of a federal tax credit that covers 10 percent of the home price, or up to $8,000 for first-time owners. Home sales must be completed by the end of November for buyers to qualify. Builders and real estate agents are pressing Congress for that credit to be extended.
Sales varied dramatically around the country. The best performance was in the West, where sales rose more than 12 percent, and the worst was in the Northeast, where sales sank more than 16 percent. They were unchanged in the South, and down nearly 6 percent in the Midwest.
Meanwhile, KB Home posted a smaller third-quarter loss of $66 million on Friday as new home orders increased and the builder cut costs. Though the results missed analysts’ expectations, KB Home said its new orders jumped 62 percent in the third quarter from the year before, with every region showing annual growth.
And fewer homebuyers backed out. The company’s cancellation rate dropped to 27 percent during the quarter, compared with 51 percent a year ago.
The Commerce Department said Friday sales inched up to a seasonally adjusted annual rate of 429,000 from a downwardly revised 426,000 in July. Economists surveyed by Thomson Reuters had expected a pace of 440,000.
While it was the fifth straight increase and the strongest report in 11 months, sales were 4.3 percent lower than the same month last year. Sales have risen 30 percent from the bottom in January, but are off about 70 percent from the peak of four years ago.
The report was the second straight disappointing sign for the U.S. housing market, which is struggling to emerge from the most severe bust in generations. On Thursday, the National Association of Realtors said sales of previously occupied homes, which make up the bulk of the market, dipped 2.7 percent last month.
While August’s housing reports have been disappointing, “we believe both remain on an upward trend,” wrote David Resler, chief economist with Nomura Securities.
Builders continue to make severe cuts in prices to attract buyers. The median sales price of $195,200 was off 11.7 percent from $221,000 a year earlier, and 9.5 percent below July’s level of $215,600. That was the largest monthly drop on records dating to 1963.
There were 262,000 new homes for sale at the end of August, down more than 3 percent from July and the lowest in nearly 17 years. At the current sales pace, that represents 7.3 months of supply – the smallest amount since early 2007. The decline means builders have scaled back construction to the point where supply and demand are coming into balance.
Still, it’s taking more than a year to sell the homes on the market.
“No one ever said that the homebuilders were breaking out the bubbly and party hats and doing the cha-cha around town,” wrote Jennifer Lee, economist with BMO Capital Markets.
Buyers, meanwhile, are rushing to take advantage of a federal tax credit that covers 10 percent of the home price, or up to $8,000 for first-time owners. Home sales must be completed by the end of November for buyers to qualify. Builders and real estate agents are pressing Congress for that credit to be extended.
Sales varied dramatically around the country. The best performance was in the West, where sales rose more than 12 percent, and the worst was in the Northeast, where sales sank more than 16 percent. They were unchanged in the South, and down nearly 6 percent in the Midwest.
Meanwhile, KB Home posted a smaller third-quarter loss of $66 million on Friday as new home orders increased and the builder cut costs. Though the results missed analysts’ expectations, KB Home said its new orders jumped 62 percent in the third quarter from the year before, with every region showing annual growth.
And fewer homebuyers backed out. The company’s cancellation rate dropped to 27 percent during the quarter, compared with 51 percent a year ago.
Foreign-born population dips in South Florida
MIAMI – Sept. 23, 2009 – The immigration-fueled population engine that for decades has powered Miami-Dade County’s growth is sputtering, new estimates from the U.S. Census Bureau suggest.
The county’s population, which in recent years had grown by as much as 20,000 annually, stood at just below 2.4 million in 2008, effectively little changed since 2006, according to data from the annual American Community Survey, released Tuesday.
During that period, the number of Miami-Dade’s foreign-born residents dipped, driving down the foreign-born proportion of the county’s population from just above 50 percent in 2007 to just below that in 2008, the last year for which survey data is available.
The number of foreign-born residents also fell somewhat in Broward County, which has also experienced a drop of about 35,000 in its overall population since 2006, according to the survey.
Nationally, while the country’s population continues growing, the proportion of foreign-born U.S. residents – both legal and not – also declined slightly, by one-tenth of one percent. The country’s immigrant population in 2008 stood at just below 38 million, or 12.5 percent of the total U.S. population, the survey found.
The trend in the immigrant population, which had increased rapidly when the nation’s economy was booming, supports anecdotal evidence that immigration into the country has slowed significantly – and perhaps gone into reverse. Several recent studies have suggested that many immigrants, in particular those without legal status or secure jobs, have gone home.
“It’s too early to tell whether it’s the start of a trend or a one-time thing related to the recession,” said Scott Boggess, an American Community Survey statistician.
While small, the dip in Miami-Dade’s foreign-born population represents a marked reversal of long-standing, pre-recession trends that transformed the county. The county’s explosive population growth was fed primarily by immigration from Latin America and the Caribbean, in particular Cuba, as more native-born Americans left the county than moved into it.
But the slowdown in immigration, should it persist, could have significant implications for Miami-Dade’s economy, which has been driven in large part by residential and commercial real estate development dependent on population growth.
While Broward has not been the immigration magnet Miami-Dade has been, its foreign-born residents made up a significant 30.4 percent of the county population in 2007 before falling back to 29.6 percent in 2008. A substantial number of the county’s foreign-born residents are immigrants who moved to Broward’s suburbs from Miami-Dade. Many English-speaking Caribbean immigrants have also settled directly in Broward.
The estimates show a small decline for Florida’s foreign-born population, from slightly more than 3.4 million in 2007 to just under that number in 2008 – though immigrants remained essentially flat as a proportion of the total state population.
Because the ACS data is from 2008, it doesn’t reflect an overall drop in the state population that a recent University of Florida study concluded occurred between 2008 and 2009.
But the decline in immigrants was not uniform across Florida, noted Dario Gonzalez, a demographer at Florida International University’s Metropolitan Center.
“Some smaller counties are continuing to get increases in the foreign-born,” Gonzalez said, pointing to Polk, Volusia and Lake counties in Central Florida.
An analysis of the data by the Associated Press shows that about half of U.S. states showed declines in immigrant populations from 2007 to 2008. Some major metro areas also posted decreases, including Los Angeles, Phoenix, Detroit and Tampa, the AP found.
The ACS, which is based on Census Bureau surveys of about 250,000 households per month, has taken the place of long-form survey in the decennial census, which asked detailed economic and social questions. The survey estimates, which cover a gamut of demographic and social characteristics, is available on the U.S. Census website, www.census.gov.
ACS survey data on family income and poverty will be released next week because of a data-processing glitch that delayed its release with the other information.
Copyright © 2009 The Miami Herald, Andres Viglucci. Distributed by McClatchy-Tribune Information Services.
The county’s population, which in recent years had grown by as much as 20,000 annually, stood at just below 2.4 million in 2008, effectively little changed since 2006, according to data from the annual American Community Survey, released Tuesday.
During that period, the number of Miami-Dade’s foreign-born residents dipped, driving down the foreign-born proportion of the county’s population from just above 50 percent in 2007 to just below that in 2008, the last year for which survey data is available.
The number of foreign-born residents also fell somewhat in Broward County, which has also experienced a drop of about 35,000 in its overall population since 2006, according to the survey.
Nationally, while the country’s population continues growing, the proportion of foreign-born U.S. residents – both legal and not – also declined slightly, by one-tenth of one percent. The country’s immigrant population in 2008 stood at just below 38 million, or 12.5 percent of the total U.S. population, the survey found.
The trend in the immigrant population, which had increased rapidly when the nation’s economy was booming, supports anecdotal evidence that immigration into the country has slowed significantly – and perhaps gone into reverse. Several recent studies have suggested that many immigrants, in particular those without legal status or secure jobs, have gone home.
“It’s too early to tell whether it’s the start of a trend or a one-time thing related to the recession,” said Scott Boggess, an American Community Survey statistician.
While small, the dip in Miami-Dade’s foreign-born population represents a marked reversal of long-standing, pre-recession trends that transformed the county. The county’s explosive population growth was fed primarily by immigration from Latin America and the Caribbean, in particular Cuba, as more native-born Americans left the county than moved into it.
But the slowdown in immigration, should it persist, could have significant implications for Miami-Dade’s economy, which has been driven in large part by residential and commercial real estate development dependent on population growth.
While Broward has not been the immigration magnet Miami-Dade has been, its foreign-born residents made up a significant 30.4 percent of the county population in 2007 before falling back to 29.6 percent in 2008. A substantial number of the county’s foreign-born residents are immigrants who moved to Broward’s suburbs from Miami-Dade. Many English-speaking Caribbean immigrants have also settled directly in Broward.
The estimates show a small decline for Florida’s foreign-born population, from slightly more than 3.4 million in 2007 to just under that number in 2008 – though immigrants remained essentially flat as a proportion of the total state population.
Because the ACS data is from 2008, it doesn’t reflect an overall drop in the state population that a recent University of Florida study concluded occurred between 2008 and 2009.
But the decline in immigrants was not uniform across Florida, noted Dario Gonzalez, a demographer at Florida International University’s Metropolitan Center.
“Some smaller counties are continuing to get increases in the foreign-born,” Gonzalez said, pointing to Polk, Volusia and Lake counties in Central Florida.
An analysis of the data by the Associated Press shows that about half of U.S. states showed declines in immigrant populations from 2007 to 2008. Some major metro areas also posted decreases, including Los Angeles, Phoenix, Detroit and Tampa, the AP found.
The ACS, which is based on Census Bureau surveys of about 250,000 households per month, has taken the place of long-form survey in the decennial census, which asked detailed economic and social questions. The survey estimates, which cover a gamut of demographic and social characteristics, is available on the U.S. Census website, www.census.gov.
ACS survey data on family income and poverty will be released next week because of a data-processing glitch that delayed its release with the other information.
Copyright © 2009 The Miami Herald, Andres Viglucci. Distributed by McClatchy-Tribune Information Services.
Fed all but declares recession over
WASHINGTON – Sept. 24, 2009 – The Federal Reserve provided its most upbeat assessment yet of the economy on Wednesday, suggesting the recession is over and growth could be more robust than it previously anticipated.
But noting the economy is still relatively weak, the central bank agreed to keep a key interest rate unchanged near zero and extended its financial support for the housing market until the end of the first quarter.
“Economic activity has picked up following its severe downturn,” the Fed said after its two-day meeting.
Translation? “The downturn is over,” says Allen Sinai, chief economist of Decision Economics.
That echoes Fed Chairman Ben Bernanke’s remarks last week that the recession is likely history. The housing market is ticking up and household spending is stabilizing, the Fed said, adding it expects its policies to “support a strengthening of economic growth.”
Sinai says the more bullish language signals the Fed will likely upgrade its third-quarter growth estimate to more than 3 percent, in line with many economists.
But the central bank added consumer spending “remains constrained by ongoing job losses” and “tight credit,” among other obstacles. The Fed had planned to complete purchases of up to $1.25 trillion of mortgage-backed securities and another $200 billion in mortgage-related debt by year’s end. The initiative has lowered mortgage rates. On Wednesday, the central bank said it would buy a total of $1.25 trillion by March 31.
“I think that’s very significant” because it shows the Fed believes mortgage markets still need government support, says economist Conrad DeQuadros of RDQ Economics.
Stretching out the program, he says, ensures a smoother transition to more robust private lending.
But the maneuver also means that the Fed is slowing down its purchases amid less constrained mortgage lending, says Bruce McCain, chief investment strategist at Key Private Bank.
The Fed apparently believes mortgage markets should return to normal by spring, Sinai says.
Similarly, it agreed in August to extend its purchases of $300 billion in Treasury securities by a month until the end of October.
With factories running at less than 70 percent capacity, the Fed said Wednesday it’s not worried about rising prices, adding “inflation will remain subdued for some time.”
In turn, it reiterated that interest rates will likely stay low “for an extended period.”
But noting the economy is still relatively weak, the central bank agreed to keep a key interest rate unchanged near zero and extended its financial support for the housing market until the end of the first quarter.
“Economic activity has picked up following its severe downturn,” the Fed said after its two-day meeting.
Translation? “The downturn is over,” says Allen Sinai, chief economist of Decision Economics.
That echoes Fed Chairman Ben Bernanke’s remarks last week that the recession is likely history. The housing market is ticking up and household spending is stabilizing, the Fed said, adding it expects its policies to “support a strengthening of economic growth.”
Sinai says the more bullish language signals the Fed will likely upgrade its third-quarter growth estimate to more than 3 percent, in line with many economists.
But the central bank added consumer spending “remains constrained by ongoing job losses” and “tight credit,” among other obstacles. The Fed had planned to complete purchases of up to $1.25 trillion of mortgage-backed securities and another $200 billion in mortgage-related debt by year’s end. The initiative has lowered mortgage rates. On Wednesday, the central bank said it would buy a total of $1.25 trillion by March 31.
“I think that’s very significant” because it shows the Fed believes mortgage markets still need government support, says economist Conrad DeQuadros of RDQ Economics.
Stretching out the program, he says, ensures a smoother transition to more robust private lending.
But the maneuver also means that the Fed is slowing down its purchases amid less constrained mortgage lending, says Bruce McCain, chief investment strategist at Key Private Bank.
The Fed apparently believes mortgage markets should return to normal by spring, Sinai says.
Similarly, it agreed in August to extend its purchases of $300 billion in Treasury securities by a month until the end of October.
With factories running at less than 70 percent capacity, the Fed said Wednesday it’s not worried about rising prices, adding “inflation will remain subdued for some time.”
In turn, it reiterated that interest rates will likely stay low “for an extended period.”
$1 million going further in many housing markets
SOUTH FLORIDA – Sept. 28, 2009 – A million dollars doesn’t buy you what it once did. In most U.S. neighborhoods, it now gets you a lot more.
During the housing boom, prices rose so high and so fast that even cookie-cutter homes in the paved suburbs of South Florida and California could cost a cool million. In Santa Clara, Calif., a high-tech hot spot, the median price hit $836,780 in 2007.
That was a long way from the days when a million-dollar home evoked images of marble columns and swimming pools with vanishing edges. Subprime loans allowed more people than ever to buy houses that were once above their means. Higher demand fueled ever-higher prices until the spigot of cheap money was turned off and the housing bubble burst. The recession forced many well-heeled buyers into unemployment lines. And sales of homes over $1 million cratered by more than 50 percent from the peak four years ago.
“Everyone has less money than they once had,” said Amy Wright, an agent with The Real Estate Office in Rancho Santa Fe, Calif. “That has certainly affected the nouveau riche, and that’s definitely in that $1 million price point.”
For people who do have the money, however, it’s the best time in years to buy luxury real estate.
Rancho Santa Fe is a luxury enclave in San Diego County that has over the years lured the likes of Howard Hughes and Bill Gates. Equestrian trails border golf courses, and the most expensive home on the market is listed for $29.9 million.
A couple of years ago, the idea of getting a house in Rancho Santa Fe for a paltry $1 million was laughable. Now, foreclosures and financially distressed homeowners account for about 15 percent of sales, and home prices are down 30 percent.
In one golf-course community in the town, a 2,200-square-foot home is listed for $800,000. Residents live in a gated community where Spanish style homes surround a 250-acre Rees Jones-designed golf course and an accompanying 35,000-square foot clubhouse.
In the 20 largest U.S. metro areas, about 2,800 homes sold for more than $1 million in July – down by more than half from July 2005, according to MDA DataQuick. Nationwide, overall home sales were down about 27 percent, according to the National Association of Realtors.
In the month of August, sellers with homes priced above $2 million were cutting prices by an average of 14 percent, compared with the national average of 10 percent, according to Trulia.com.
The good news for luxury homebuyers is that they’re getting about 20 percent “more house” than they did two years ago, and the prestige of owning a $1 million home is returning, said John Brian Losh, CEO of luxuryrealestate.com.
That is, if they can afford the payments.
On Friday, the average interest rate for a 30-year “jumbo loan” (defined as a mortgage over $729,750) was 6.18 percent – about a point higher than a conventional fixed-rate mortgage, according to Bankrate.com. That means the mortgage payment for a $1 million home (with a down payment of 20 percent) would run about $4,900 a month, not including property taxes.
A buyer would have to earn at least $200,000 a year to make the payment plus taxes – and only about 4 percent of Americans fall into that tax bracket, 2007 Census data shows.
In Fort Myers, Fla., Pat and Dennis Tyeryar are trying to sell their four-bedroom, 3,795-square-foot house on three acres for $999,700. The property is a rare slice of lush Old Florida, with moss cascading off shade trees and views of a river and lagoon.
The property, valued at $1.4 million four years ago, is unique for the area because it sits on a peninsula: Every room in the house has a water view.
So far, no offers.
In a recession-battered place like Saginaw, Mich., however, a person can scoop up almost 18 houses for $1 million. Or, a buyer can get a 6,360-square-foot, two-story brick palace that sits on a five-acre estate.
The house is priced at $995,000. It has an indoor swimming pool and six bedrooms, but the property has been a hard sell in a market where a 2,300-square-foot home can go for $160,000, real estate agent Bruce Shaw said.
Shaw said the home would have been listed for about $1.3 million during the boom.
“It’s not like I get a lot of calls on it, not unless someone is moving from Southern California,” he said.
In Toledo, Ohio, agent Nancy Kabat has two listings that add up to $1 million – a six-bedroom, $635,000 house in suburban Ottawa Hills, and a three-story, two-bedroom condo on the Maumee River for $360,000.
The house has detailed crown molding and a renovated kitchen with granite countertops. It’s also near good schools. The condo has a view of Toledo’s landmark Anthony Wayne Bridge and is a short ride to an area with upscale restaurants and a vibrant nightlife.
“You could have a house in the suburbs for the winter and have a condo on the river in the summer and use your boat,” Kabat said.
If that approach doesn’t work, a buyer can pursue a three-bedroom, Mediterranean-style home in Toledo for $969,177, according to realtor.com. The 4,800-square-foot property was built in 2007 and has a three-car garage and upscale kitchen appliances like a stainless steel refrigerator and a dual-temperature wine cooler.
“We don’t have that many million dollar houses here, so it seems that they’re holding their value,” said Betty Lazzaro, an agent with Sulfur Springs Realty Inc.
During the housing boom, prices rose so high and so fast that even cookie-cutter homes in the paved suburbs of South Florida and California could cost a cool million. In Santa Clara, Calif., a high-tech hot spot, the median price hit $836,780 in 2007.
That was a long way from the days when a million-dollar home evoked images of marble columns and swimming pools with vanishing edges. Subprime loans allowed more people than ever to buy houses that were once above their means. Higher demand fueled ever-higher prices until the spigot of cheap money was turned off and the housing bubble burst. The recession forced many well-heeled buyers into unemployment lines. And sales of homes over $1 million cratered by more than 50 percent from the peak four years ago.
“Everyone has less money than they once had,” said Amy Wright, an agent with The Real Estate Office in Rancho Santa Fe, Calif. “That has certainly affected the nouveau riche, and that’s definitely in that $1 million price point.”
For people who do have the money, however, it’s the best time in years to buy luxury real estate.
Rancho Santa Fe is a luxury enclave in San Diego County that has over the years lured the likes of Howard Hughes and Bill Gates. Equestrian trails border golf courses, and the most expensive home on the market is listed for $29.9 million.
A couple of years ago, the idea of getting a house in Rancho Santa Fe for a paltry $1 million was laughable. Now, foreclosures and financially distressed homeowners account for about 15 percent of sales, and home prices are down 30 percent.
In one golf-course community in the town, a 2,200-square-foot home is listed for $800,000. Residents live in a gated community where Spanish style homes surround a 250-acre Rees Jones-designed golf course and an accompanying 35,000-square foot clubhouse.
In the 20 largest U.S. metro areas, about 2,800 homes sold for more than $1 million in July – down by more than half from July 2005, according to MDA DataQuick. Nationwide, overall home sales were down about 27 percent, according to the National Association of Realtors.
In the month of August, sellers with homes priced above $2 million were cutting prices by an average of 14 percent, compared with the national average of 10 percent, according to Trulia.com.
The good news for luxury homebuyers is that they’re getting about 20 percent “more house” than they did two years ago, and the prestige of owning a $1 million home is returning, said John Brian Losh, CEO of luxuryrealestate.com.
That is, if they can afford the payments.
On Friday, the average interest rate for a 30-year “jumbo loan” (defined as a mortgage over $729,750) was 6.18 percent – about a point higher than a conventional fixed-rate mortgage, according to Bankrate.com. That means the mortgage payment for a $1 million home (with a down payment of 20 percent) would run about $4,900 a month, not including property taxes.
A buyer would have to earn at least $200,000 a year to make the payment plus taxes – and only about 4 percent of Americans fall into that tax bracket, 2007 Census data shows.
In Fort Myers, Fla., Pat and Dennis Tyeryar are trying to sell their four-bedroom, 3,795-square-foot house on three acres for $999,700. The property is a rare slice of lush Old Florida, with moss cascading off shade trees and views of a river and lagoon.
The property, valued at $1.4 million four years ago, is unique for the area because it sits on a peninsula: Every room in the house has a water view.
So far, no offers.
In a recession-battered place like Saginaw, Mich., however, a person can scoop up almost 18 houses for $1 million. Or, a buyer can get a 6,360-square-foot, two-story brick palace that sits on a five-acre estate.
The house is priced at $995,000. It has an indoor swimming pool and six bedrooms, but the property has been a hard sell in a market where a 2,300-square-foot home can go for $160,000, real estate agent Bruce Shaw said.
Shaw said the home would have been listed for about $1.3 million during the boom.
“It’s not like I get a lot of calls on it, not unless someone is moving from Southern California,” he said.
In Toledo, Ohio, agent Nancy Kabat has two listings that add up to $1 million – a six-bedroom, $635,000 house in suburban Ottawa Hills, and a three-story, two-bedroom condo on the Maumee River for $360,000.
The house has detailed crown molding and a renovated kitchen with granite countertops. It’s also near good schools. The condo has a view of Toledo’s landmark Anthony Wayne Bridge and is a short ride to an area with upscale restaurants and a vibrant nightlife.
“You could have a house in the suburbs for the winter and have a condo on the river in the summer and use your boat,” Kabat said.
If that approach doesn’t work, a buyer can pursue a three-bedroom, Mediterranean-style home in Toledo for $969,177, according to realtor.com. The 4,800-square-foot property was built in 2007 and has a three-car garage and upscale kitchen appliances like a stainless steel refrigerator and a dual-temperature wine cooler.
“We don’t have that many million dollar houses here, so it seems that they’re holding their value,” said Betty Lazzaro, an agent with Sulfur Springs Realty Inc.
U.S. Census: Floridians drive more, earn less
TALLAHASSEE, Fla. – Sept. 23, 2009 – Floridians drive more, earn less and pay about the same percentage in property taxes as residents of other states, according to the U.S. Census Bureau’s latest compendium of data. The bureau released the 2008 American Community Survey, a massive annual compilation of demographic and financial information, on Tuesday.
Among its findings: Florida’s property taxes are lower as a percentage of home value than the national median. Of nearly 788 counties surveyed, for example, Broward County ranked 330th in the nation in 2008 with a property tax rate equal to 1 percent of home value – identical to that of half the U.S. counties. That translates to $2,641, according to an analysis of the Census Bureau data by The Tax Foundation, a D.C.-based group.
Overall, the top 10 counties for high property taxes were in New York, with the majority of high tax states also clustered in the Northeast.
“In the county rankings, there has been little change from the 2007 numbers, where the Northeast – specifically New York and New Jersey – dominated the highest-taxed counties,” says Gerald Prante, senior economist for the Tax Foundation.
With a median household income of $47,778 in 2008, Florida ranked 34th among U.S. states and the District of Columbia in annual income. The median household income in the U.S. is $52,209.
Florida’s reliance on service employment is partially responsible for the low ranking. The state has the fourth highest service employment rate in the country while ranking 46 among states for professional level employment. In total, five states — Arizona, California, Florida, Indiana and Michigan — saw real median household income fall between 2007 and 2008. That compares to only one state between 2006 and 2007.
On the home front, Florida ranked 20th in median home value in 2008, with half the homes valued at less than $218,700, compared to $197,600 for the U.S. as a whole. Half of Florida homeowners pay at least $1,603 a month in mortgage and escrow payments, which is higher than the median U.S. monthly outlay of $1,514.
Higher home prices and lower median income combine to make it relatively more expensive for Floridians to own homes. Among mortgage holders, 49 percent of Floridians spend more than 30 percent of their monthly income on housing – the third highest rate in the country.
Other findings include:
• Floridians commute 25.8 minutes a day on average to get to work, or slightly more than their U.S. peers. North Dakota workers had the least commute time, traveling less than 15 minutes to their jobs.
• Nearly 38 percent of Florida grandparents are responsible for the welfare of their grandchildren compared to 41 percent of all U.S. residents.
• More than one in five Floridians speak a language other than English in their homes, the eighth highest percentage among American states.
Source: News Service of Florida, Michael Peltier
Among its findings: Florida’s property taxes are lower as a percentage of home value than the national median. Of nearly 788 counties surveyed, for example, Broward County ranked 330th in the nation in 2008 with a property tax rate equal to 1 percent of home value – identical to that of half the U.S. counties. That translates to $2,641, according to an analysis of the Census Bureau data by The Tax Foundation, a D.C.-based group.
Overall, the top 10 counties for high property taxes were in New York, with the majority of high tax states also clustered in the Northeast.
“In the county rankings, there has been little change from the 2007 numbers, where the Northeast – specifically New York and New Jersey – dominated the highest-taxed counties,” says Gerald Prante, senior economist for the Tax Foundation.
With a median household income of $47,778 in 2008, Florida ranked 34th among U.S. states and the District of Columbia in annual income. The median household income in the U.S. is $52,209.
Florida’s reliance on service employment is partially responsible for the low ranking. The state has the fourth highest service employment rate in the country while ranking 46 among states for professional level employment. In total, five states — Arizona, California, Florida, Indiana and Michigan — saw real median household income fall between 2007 and 2008. That compares to only one state between 2006 and 2007.
On the home front, Florida ranked 20th in median home value in 2008, with half the homes valued at less than $218,700, compared to $197,600 for the U.S. as a whole. Half of Florida homeowners pay at least $1,603 a month in mortgage and escrow payments, which is higher than the median U.S. monthly outlay of $1,514.
Higher home prices and lower median income combine to make it relatively more expensive for Floridians to own homes. Among mortgage holders, 49 percent of Floridians spend more than 30 percent of their monthly income on housing – the third highest rate in the country.
Other findings include:
• Floridians commute 25.8 minutes a day on average to get to work, or slightly more than their U.S. peers. North Dakota workers had the least commute time, traveling less than 15 minutes to their jobs.
• Nearly 38 percent of Florida grandparents are responsible for the welfare of their grandchildren compared to 41 percent of all U.S. residents.
• More than one in five Floridians speak a language other than English in their homes, the eighth highest percentage among American states.
Source: News Service of Florida, Michael Peltier
Rates on 30-year loans remain at 5.04 percent
Mortgage Rate Trend Index
This week, industry experts polled by Bankrate.com say, “Rates aren’t going anywhere soon.” A strong majority of the panelists (69 percent) believe mortgage rates will remain relatively unchanged over the next 35 to 45 days. The rest are almost evenly split among those who think rates will rise (15 percent) and those who predict they will fall (16 percent).
WASHINGTON – Sept. 25, 2009 – Rates for 30-year home loans were unchanged this week and remain close to record-low levels.
The average rate for a 30-year fixed mortgage was 5.04 percent, the same as a week earlier, mortgage company Freddie Mac said Thursday.
Rates, while above the record low of 4.78 percent hit in the spring, are still attractive for people looking to buy a home or refinance. Applications for home loans rose nearly 13 percent last week from a week earlier as refinancing applications surged, the Mortgage Bankers Association said Wednesday.
With the economy on the mend, the Federal Reserve decided Wednesday to stretch out the pace of a program that has lowered mortgage rates and propped up the housing market this year.
The central bank now plans to reach its goal of buying $1.45 trillion in mortgage-backed securities and debt by the end of March, rather than by the end of this year as originally scheduled. Analysts say mortgage rates should remain low for now but could eventually head higher, and homeowners who want to refinance mortgages shouldn’t delay.
The Fed’s move is designed to buy more time for the housing and mortgage markets to recover. The Fed “is betting that conditions should be improved by the second quarter of 2010, and therefore it makes sense to stretch out the timetable for supporting the mortgage markets,” Brian Bethune, chief U.S. economist at IHS Global Insight wrote Wednesday.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.
The average rate on a 15-year fixed-rate mortgage fell to 4.46 percent from 4.47 percent last week, according to Freddie Mac. That was the lowest level on records dating to 1991.
Rates on five-year, adjustable-rate mortgages averaged 4.51 percent, unchanged from a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.52 percent from 4.58 percent.
The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac’s survey averaged 0.6 point for 30-year, 15-year and one-year loans. The fee averaged 0.5 point for five-year mortgages.
This week, industry experts polled by Bankrate.com say, “Rates aren’t going anywhere soon.” A strong majority of the panelists (69 percent) believe mortgage rates will remain relatively unchanged over the next 35 to 45 days. The rest are almost evenly split among those who think rates will rise (15 percent) and those who predict they will fall (16 percent).
WASHINGTON – Sept. 25, 2009 – Rates for 30-year home loans were unchanged this week and remain close to record-low levels.
The average rate for a 30-year fixed mortgage was 5.04 percent, the same as a week earlier, mortgage company Freddie Mac said Thursday.
Rates, while above the record low of 4.78 percent hit in the spring, are still attractive for people looking to buy a home or refinance. Applications for home loans rose nearly 13 percent last week from a week earlier as refinancing applications surged, the Mortgage Bankers Association said Wednesday.
With the economy on the mend, the Federal Reserve decided Wednesday to stretch out the pace of a program that has lowered mortgage rates and propped up the housing market this year.
The central bank now plans to reach its goal of buying $1.45 trillion in mortgage-backed securities and debt by the end of March, rather than by the end of this year as originally scheduled. Analysts say mortgage rates should remain low for now but could eventually head higher, and homeowners who want to refinance mortgages shouldn’t delay.
The Fed’s move is designed to buy more time for the housing and mortgage markets to recover. The Fed “is betting that conditions should be improved by the second quarter of 2010, and therefore it makes sense to stretch out the timetable for supporting the mortgage markets,” Brian Bethune, chief U.S. economist at IHS Global Insight wrote Wednesday.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.
The average rate on a 15-year fixed-rate mortgage fell to 4.46 percent from 4.47 percent last week, according to Freddie Mac. That was the lowest level on records dating to 1991.
Rates on five-year, adjustable-rate mortgages averaged 4.51 percent, unchanged from a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.52 percent from 4.58 percent.
The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac’s survey averaged 0.6 point for 30-year, 15-year and one-year loans. The fee averaged 0.5 point for five-year mortgages.
Congress wary of ‘plain vanilla’ bank proposal
WASHINGTON – Sept. 23, 2009 – Congress is expected to reject President Barack Obama’s proposed mandate that banks offer customers “plain vanilla” financial products, such as a 30-year fixed mortgage.
The defeat would be a victory for the industry, which contends that such a proposal would give the government an unprecedented role in the marketplace.
Exotic financial products, particularly subprime mortgages, were considered a major factor in last year’s financial crisis. Loans with low introductory rates that suddenly ballooned in size prompted defaults by cash-strapped homeowners.
Under Obama’s plan, a new government agency would be established to monitor the fine print on such products as mortgages and credit cards. The Consumer Financial Protection Agency would require that lenders be up front about the cost of their products and offer customers a standard low-risk alternative.
Rep. Barney Frank, chairman of the House Financial Services Committee, is preparing legislation that would endorse the concept of the consumer agency. But Frank’s version would not require financial firms to offer standardized products, said Steve Adamske, a spokesman for the Massachusetts Democrat.
The proposal also was expected to fall flat in the Senate, where conservative Democrats and Republicans say they are concerned it would give the government too much control in the marketplace and would limit innovation.
“Implied in this belief is the notion that some people, such as the government bureaucrats, can make informed decisions about the value of products and services while others, such as the American consumer, cannot,” said Sen. Richard Shelby, the top Republican on the Senate Banking Committee.
Kirstin Brost, a spokeswoman for Sen. Christopher Dodd, said the Banking Committee chairman “has a hard time seeing how plain vanilla would work” but he is still working with his colleagues to draft the legislation.
The idea was promoted by Michael Barr, an assistant Treasury secretary for financial institutions, who says forcing banks to disclose more details about their loans wouldn’t go far enough to protect consumers.
“It is time for a level playing field for financial services competition based on strong rules, not based on exploiting consumer confusion,” Barr told the Senate Banking Committee in July.
The defeat would be a victory for the industry, which contends that such a proposal would give the government an unprecedented role in the marketplace.
Exotic financial products, particularly subprime mortgages, were considered a major factor in last year’s financial crisis. Loans with low introductory rates that suddenly ballooned in size prompted defaults by cash-strapped homeowners.
Under Obama’s plan, a new government agency would be established to monitor the fine print on such products as mortgages and credit cards. The Consumer Financial Protection Agency would require that lenders be up front about the cost of their products and offer customers a standard low-risk alternative.
Rep. Barney Frank, chairman of the House Financial Services Committee, is preparing legislation that would endorse the concept of the consumer agency. But Frank’s version would not require financial firms to offer standardized products, said Steve Adamske, a spokesman for the Massachusetts Democrat.
The proposal also was expected to fall flat in the Senate, where conservative Democrats and Republicans say they are concerned it would give the government too much control in the marketplace and would limit innovation.
“Implied in this belief is the notion that some people, such as the government bureaucrats, can make informed decisions about the value of products and services while others, such as the American consumer, cannot,” said Sen. Richard Shelby, the top Republican on the Senate Banking Committee.
Kirstin Brost, a spokeswoman for Sen. Christopher Dodd, said the Banking Committee chairman “has a hard time seeing how plain vanilla would work” but he is still working with his colleagues to draft the legislation.
The idea was promoted by Michael Barr, an assistant Treasury secretary for financial institutions, who says forcing banks to disclose more details about their loans wouldn’t go far enough to protect consumers.
“It is time for a level playing field for financial services competition based on strong rules, not based on exploiting consumer confusion,” Barr told the Senate Banking Committee in July.
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