More Good News about the Market

I have to admit I like seeing more & more good news about the housing market. 

1. First I heard Mark Zandi of Moody’s economy say that Seattle will be one of the first cities to have the housing market recover. 
2. Then yesterday I read that the national average of home sold went up in Feb as compared to Jan.  Economist were not expecting that.
3. Then today I read that Gus Faucher of Moody’s Economy.com says home sales will turn around by midyear and home prices will begin to recovering by the end of this year. 

Then on top of news I am seeing some good signs personally. 

1. 3 weeks ago my office had 3 new transaction start.  One was a listing by an agent named Peggy Miller who got 2 offers on a listing in the same day after dropping the price.  The other two were buyers working with agents in our office. 
2. This week we’ve had one more transaction start
3. And an agent in our office tried to make an offer on two different homes in the past 2 weeks and each time they homes she was going to make an offer on either sold before they got the offer in, or had multiple offers on the home they wanted.

So even though prices are not up, I am definitely seeing more activity.  And that’s positive!

Official Stimulus Details

I have recieved another email from Realtor’s outlining what has been signed by President Obama.

I will attach the entire email, but here are the bullet points

• $8,000.00 tax credit for people who buy a new home this year and  who have not owned a home in the past 3 years
• The $8,000.00 tax credit does not have to be paid back
• FHA and conforming loan limits will be the same as 2008.  (2008’s are listed below)
  • Single Family – $567,500
  • Two Family- $726,500
  • Three Family – $878,150
  • Four Family – $1,091,350

For more detail feel free to read the Realtor email below.

President Signs Economic Stimulus Measure!

February 17,2009 2pm

The $790 billion stimulus package signed by President Obama today increases the home buyer tax credit to $8,000, drops the repayment feature, reinstates last year’s 2008 loan limits for FHA, Freddie Mac, and Fannie Mae loans, and provides $2 billion in additional funding for states and localities to be used to purchase, manage, repair and resell foreclosed and abandoned properties. Many elements (listed below) included in HR 1 “American Recovery and Reinvestment Act of 2009,” were supported by the National Association of REALTORS® (NAR) as well as the many REALTORS® who sent call to action messages to Congress urging their support!

Homebuyer Tax Credit. The bill provides for a $8,000 tax credit that would be available to first-time home buyers (those who haven’t owned in at least three years) for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009. The credit does not require repayment for buyers who hold onto their property for at least three years. Most of the mechanics of the credit will be the same as under the 2008 rules: the credit will be claimed on a tax return to reduce the purchaser’s income tax liability. If any credit amount remains unused, then the unused amount will be refunded as a check to the purchaser.

NAR has sought removal of the repayment requirement because it discourages buyers from taking advantage of the tax credit. The three-year minimum holding period is a safeguard against speculators’ use of the credit. The legislation also extends the effective date of the credit to December 1 from June 30, and extends eligibility to borrowers who buy their home with the help of state or local financial assistance that comes from the proceeds of tax-exempt mortgage revenue bonds.

The start date for the first time homebuyer credit is January 1, 2009 through and before December 1, 2009.

FHA and conforming loan limits. Specifics have not been released but reports indicate that the 2008 limits have been reinstated for 2009 except in those communities where the 2009 limits are higher. Additional increases in individual communities may also be available at the discretion of the secretary of the U.S. Department of Housing and Urban Development.

Foreclosure mitigation and neighborhood stabilization. Funding for states and localities to be used for neighborhood stabilization activities for the redevelopment of abandoned and foreclosed homes are authorized. Some news reports put the funding level at $2 billion.

Rental assistance. Up to $1.5 billion to provide short-term rental assistance and other aid for families during the economic crisis.

Transportation infrastructure. Up to $29 billion for highway construction projects, $8 billion for rail projects.

Rural housing development. Increased funding for the Rural Housing Service direct and guaranteed loan programs.

Low-income housing grants. Allow states to trade in a portion of their 2009 low-income housing tax credits for Treasury grants to finance the construction or acquisition and rehabilitation of low-income housing, including those with or without tax credit allocations.

Tax-exempt housing bonds. Tax-exempt interest earned on specified state and local bonds issued during 2009 and 2010 will not be subject to the Alternative Minimum Tax (AMT). In addition, financial institutions will have greater capacity to purchase tax-exempt state and local bonds.

Energy efficient housing. Grants for energy retrofits for federally assisted housing (Section 8), funding for energy efficiency and conservation block grants to states, increases in the residential tax credit through 2010 for certain energy efficient upgrades and $5 billion to weatherize low-income homes.

Greg Wright
2009 President
Washington REALTORS®

Who else likes a staged home for sale? Squatters!

   Last week ended as the week from hell.  There was the typical stuff you get from running an office, some very late nights working, but what really pushed me over the edge was a phone call I got Thursday.  A very kind agent called me Thursday to tell me she had gone to preview a listing of mine.  The other agent informs me that she was startled because my listing said that it was vacant, but when she went to preview it the house definitely was not empty. 

The first thing I did was call the owners in the hopes they had given someone permission to stay in the house, but just forgotten to tell me.  No such luck.  So when my husband got home from work we went over together.  When we opened the door it was very evident someone was living there.  The house reeked of bacon and sausages.  There was a window screen laying in one of the bedroom windows.  And there was dirty plates, and junk everywhere.  Needless to say I then called the police.  They came out and made sure the home was clear.  They confiscated a backpack and a tent that was the squatters, dusted for finger prints on the windows and dirty dishes and then gave me a case number.  They told me that in the last 2 weeks there had been two other reports of squatters in the area.  They said in each of them, they had disappeared as soon as they knew they were busted and the police told me they did not think that they would be back.

The squatters had closed all the blinds, so I opened them up and turned on the lights, locked up and left.  Around 8pm that night minutes after I had gotten home from the office, I get a call from the owners.  They inform me that a friend of theirs was out in front of the house.  He had driven by the house on his way to a basketball game.   And what he saw was the blinds were closed again.  So he parked the car and walked by the house again and someone peeked out the blinds.  The squatters were back.  So I go back to the house to meet him and the police for a second time that day.  I got there just as the police were cuffing and placing the first person in the car.

It was two people.  A female and a male.  Both dressed nicely and both very young.  They couldn’t have been more than their early 20’s.  So for a second time that day I got a case number, locked up and went home.  Friday morning I headed over with another agent in my office who was kind enough to volunteer to help me clean up.  I found all kinds of things, a cell phone, clothes, fingernail polish (which she had wiped all over the towels etc), pocket knife, lots of dirty greasy dishes from eating sausage and bacon and DVD’s rented from the public library.

Among all of that I also found a pile of  for sale home flyers.  All looked to be vacant homes and all were in the general area.  I called all of the agents of each of those listings.  Of the 14 I called, two had already had a problem.  One agent told me that someone had broker into his listing, but had not stayed.  I asked him what he had in the house and he said only two couches.  Guess there wasn’t enough for them in that house.  The 2nd agent told me that she had squatters at her house also.  As we compared notes she told me that her squatters had eaten bacon and sausage and made a huge mess.  We decided that they were definitely the same.  She also had a staged home that included dishes, a bed etc. 

Staging a home is proven to sell a home for more and faster, but I have now discovered a downside.  It also makes a nice home for a squatter!  So be careful everyone.  This ended in probably the best way as they were caught, the agent who discovered it wasn’t hurt by the squatters and there was not a ton of damage, but I am hoping this is not a trend in these hard economic times.

15,000 tax credit for home buyers no longer included

Well, I have sad news.  The 15,000 tax credit for home buyers did not make the cut for the latest version of the stimulus package.  Very disappointing!

Economic Stimulus Package Update for Buyers

I received this email from Realtor’s today…I’m passing it along.  This is all still in the works, but it is exciting news for buyers!

 

 

Washington Economic Stimulus Package Update

February 6, 2009

Good news you can share with your clients

Due to the efforts of the National Association of REALTORS® and specific members of Congress, we are making significant progress in regards to housing provisions in the National Economic Stimulus Bill.

Last week, the US House of Representatives passed the American Recovery and Reinvestment Act (H.R.1). This bill has some key provisions that will stimulate the housing market:

• It will restore FHA, Fannie Mae and Freddie Mac to 125 percent of median home prices – up to $729,750
• It would eliminate the repayment provision for the $7,500 first time home buyer tax credit
• It expands tax-exempt housing bonds

Two days ago, the Senate approved an amendment to their bill that offers up to a $15,000 tax credit to people that purchase a home in the next year.  The credit would apply to anyone, not just first time homebuyers and you would not need to repay the credit.  The credit is based on 10% of the purchase price of the home and the credit is spread over two years.  So for example, if you buy a house with a purchase price of $300,000, you would qualify for the maximum credit of $15,000.  The first year you claim the credit, you receive $7,500, and you would receive the remaining $7,500 the next year.

Senator Patty Murray Introduces Housing Amendment

In addition to supporting the $15,000 credit, Senator Patty Murray (D) Washington, has introduced her own amendment to the Senate Stimulus Bill relating to the FHA and conforming loan limits. Specifically, Murray’s amendment:  

• Ensures that the 2008 FHA mortgage limits and conforming loan limits do not decline during calendar year 2009.
• Provides discretion to the Secretary of HUD and the Director of the Federal Housing Finance Agency (FHFA) to raise loan limits in sub-areas, up to the conforming ceiling for high cost areas.  
• Temporarily increases FHA’s Home Equity Conversion Mortgage (HECM) limit to $625,500 for 2009.  

“On behalf of all American families and over 20,000 Washington REALTORS® I’d like to thank Senator Patty Murray for introducing this amendment to the Senate Stimulus Bill to increase the loan limits” said Greg Wright, President of the Washington REALTORS®.

This week

The Senate is considering its version of the bill.  We anticipate much more debate and some changes in the days ahead, so please check Realtor.org often for updates.   

Once the Senate passes a bill, we expect lawmakers to hold a conference to work out the differences, before sending it along to the President.  The President wants a finished product by February 16, 2009.

2009 Conforming Loan Limits

The 2008 $567,500 loan limit for a single family home have expired, but instead of returning to the previous $417,000 loan limit they have set a new temporary conforming loan amounts for 2009. 

Here are the 2009 conforming loan amounts for Seattle:

Single Family:  $506,000

Two Family:      $647,750

Three Family:   $783,000

Four Family:     $973,100

2008 Five Star distinction AND Small Business Owner

What a year this has been.  So much has happened this year; some of it great and some of it a bit more hair-raising.  I can’t say 2008 was boring.

 

 On a personal level this is ending as an incredible year for me.  It has been such a fun year working with all of you.  And I was really honored to have been voted 2008 FIVE STAR: Best In Client Satisfaction^SM    I can’t tell you how surprised and touched I was to find out that my clients had voted me for this distinction.  For those of you who did; thank you so much! 

 Another really exciting event is my purchase of Quorum.  It has been my goal to be in business for myself for quite some time and that goal has just been realized.  My husband and I have purchased the Quorum office.  The new corporation name will be Quorum – Laurelhurst, Inc.    I am so grateful to be buying a business that has such a great legacy and great real estate agents.  I am really looking forward to building upon that legacy and working with all the agents to take the Quorum office to the next level.

I am excited about the possibilities and adventures that are headed our way for 2009.   

Thank you again for everything and have a wonderful Holiday and Happy New Year

       http://video.fivestarprofessional.com/seare2008/jennflynn

Exactly what are these “Sweeteners” Bail-Out Package Bribes?

So I’ve been trying to figure exactly what all was included in order to “sweeten” the Bail Out package enough to get it to pass.  I can’t beleive how hard it seems to be to find out exactly what is included, and I can’t beleive some of the things I’m hearing/reading are a part of it.  It really bugs me that so much that had nothing to do with the bail-out is included in this package.  Talk about pork barreling. 

Here is the list I’ve compiled so far…Let me know if you know of more.

1.    Almost a $200 million tax rebate for the Virgin Islands and Puerto Rico’s rum production

2.    Tax credit that exempts wooden practice arrows used by children from an excise tax of 39 cents per arrow (2 million)

3.    Tax credit for race-track owners. (100 million)

4.    A tariff relief measure for US worsted wool fabric producers that use imported yarns (148 million)

5.    temporarily raising the FDIC insurance cap to $250,000 from $100,000

6.    Tax credit for bicycle commuters

7.    Extends a number of renewable energy tax breaks for individuals and businesses, including a deduction for the purchase of solar panels.

8.    Research and development credit for businesses and the credit that allows individuals to deduct state and local sales taxes on their federal returns.

9.    In addition, the bill includes relief for another year from the Alternative Minimum Tax

10. Insurance companies would have to provide coverage for mental health services comparable to what they provide for other health care.

Bailout Alternative

I’ve got a bailout alternative idea.  Since this whole crisis started with sub-prime loans being made to people who could not afford the loan once the adjustable rate started going up.  Why doesn’t the government step in and mandate that the mortgage companies return those adjustable rates to the initial rate that the homeowner’s qualified for and set it as a fixed loan. 

Instead of the tax payers being left holding the bag for some unknown number (since 700 Billion is just an estimate).   The mortgage companies will just be forced to take the impact as if all of those had been fixed rate loans.  So they won’t make as much, but they are going under at alarming rates anyways.  And then the homeowners facing foreclosure will be able to afford their loan again, thus not being forced into foreclosure.  Then the number of homes on the market will go back down….

what do you think?

Letter From Motley Fool in response to Lehman Brothers collapse

Because I think we all need this reminder….I am posting an email I recieved from Motley Fool…to stay calm.

 

Dear Fellow Fools,
This morning, markets around the globe dropped further, due in no small part to the collapse of Lehman Brothers. Fools, we understand that the current state of the financial markets and industry can be disconcerting. But please know that we, your advisors, are paying close attention to these events, and we spent much of the weekend analyzing the potential impact on our recommended companies. We encourage you to come to the discussion boards for your services for updates on the credit crisis and its effect on our companies.
More important, we ask you to remain calm. You may be tempted to act rashly, but please remember, this too shall pass.
Like every other financial crisis our markets have faced, this situation is part of the cycle that has allowed so many investors to generate great wealth in the markets. Warren Buffett and his teacher, Benjamin Graham, are right: Over time, the market is a weighing machine. Companies cannot make poor financial decisions without eventually having to deal with the consequences. By allowing the collapse of Lehman Brothers to happen, the federal government and industry giants have indirectly decided to allow the capitalist system to do its work. We believe this is a good thing; it is a statement of hope, and we believe you should embrace it.
During the next few days and weeks, the markets promise to be extremely volatile. The response from Wall Street and the financial press will range from euphoric to despondent, and much of the advice you hear will be emotional and short-term in focus.
We also recognize the very real risks in the market today. More companies are sure to struggle. But at the same time, we urge you not to panic or react in haste. If we retain our wits, we can’t help but make better decisions than the majority of investors.
History has shown that after virtually every sudden drop the market has experienced, it recovered within a few years. Case in point: Six months after the 1995 Oklahoma City bombing, the S&P 500 had gained 17%, and six months after the lows of September 2001, it was up nearly 19%. Even if the rewards aren’t immediately obvious, in the long term, objective analysis of the opportunities and risks will prove superior to an emotional reaction.
Thank you for continuing to put your faith in us and The Motley Fool during these volatile times. We will continue to monitor these events and keep you apprised of our thinking in our issues and updates, on our websites, and most immediately on our discussion boards. To read our latest opinions on the situation and the impact on the companies on our scorecards, go to the Discuss tab of your newsletter website. We also encourage you to check Fool.com for regular commentary as the situation develops.
Foolish best,
David Gardner, Tom Gardner, Bill Mann, Seth Jayson, Jim Gillies, Andy Cross, James Early, Philip Durell, Ron Gross, Robert Brokamp, Amanda Kish, and Shannon Zimmerman