Current New Clip on MA Housing Market from NECN

Here is a recent clip on the MA housing market from NECN:

MA Housing Market Report

NOW Is THE Time To Sell!!

If you are seriously thinking of selling your house, NOW is the time to get serious.  So you think we are at the bottom of the market?  Here are a few points to consider:

• Single Family Sales units in North Central MA are declining at a Faster rate (more than 2 times) than the same period last year.
• Single Family average Sale Prices are declining at a Greater rate than the same period last year.
• Lending standards are getting increasingly more difficult - i.e. harder to get a loan.
• Job losses are only Now starting to come into play - and there are more coming.
• The economy is eroding before our eyes.
• The foreclosure rate is increasing
• Currently we are 2-3 years before the 'Bulk' of the Adjustable Rate Mortgages reset (Including the Option Arms - what's an Option Arm? Look for another post soon).
• I can go on...

Looking at these facts, is there any reason why you would think that prices are going to go up? 

OK, so you are a buyer.  Why Buy now? Well, 30 year Fixed Rate Mortgages (yes, FIXED - not Blend loans, Option Arms, NINJA loans, etc.) are still at 40 year lows BUT prices have been beaten up over the past 3 or so years.  We are seeing prices back to levels we saw in 2003 +/- but Mortgage rates are just about as low as back then - thus setting the stage for some great affordability.

If you have a secure job, this is a great opportunity.  Yes, prices may fall more, however Interest rates are almost sure to go up due (to the economy, the low value of the dollar, imminent recession, etc).  So remember, small changes in the Interest rate can equate to large increases in the payment.

Why Now Is A Good Time to Buy

We all know of that the economy is a mess (thank you Wall Street & Congress), however I find that I've been Very Busy over the past 2 weeks.  I've been negotiating offers in the $200K range all the way up to the High $800K range (with a few in between).  You may be wondering Why anyone is buying right now.

Well, think about this:

First, let me go through the assumptions:

30 Year Fixed Rate Conforming Loan (Principal & Interest Only)

A $300,000 loan at 6% is approximately $1,798 per month.

A $300,000 loan at 8% is approximately $2,201 per month.

Guess how much the value of a property would need to drop in order to get the payment back to what is would have been at 6% instead of 8% in this example.

Approximately $55,000!

$245,000 at 8% over 30 years is just over $1 per month in payment.

So... Given all of the economic BS going on out there, do you think Mortgage Rates will be going up or down?

Remember Fannie Mae & Freddie Mac?  Do you think investors are lining up to buy Mortgage Backed Securities right now? If the demand for MBS's goes down the return must go up in order to lure the investors back in (supply/demand).

Not to mention that it is harder to get a mortgage right now than it was before, and it appears that it will continue to get more difficult.

So if you are looking to buy a home to live in (not to flip) then Now may be one of the best times.

What do you think??

Foreclosure Deeds in MA Reach A Record in April, 2008

I received an email this morning from Banker and Tradesman (a publication of The Warren Group) indicating the following:

"Massachusetts foreclosure deeds soared to their highest recorded level in April, according to The Warren Group, Banker & Tradesman’s parent company. The number of deeds so far this year outpaced those in the first four months of 2005 by 1,165 percent."

Sounds bad doesn't it? But here are some points to consider:
These foreclosures are largely a result of activities that took place 2 to 4 years ago.

Since then:

• Lending Standards Have Tightened significantly (and in my opinion; TOO much).
• 100% financing is no longer available to 'Just Anyone' anymore.
• Prices have adjusted.
• Conventional Fixed Mortgage are still Historically 'Good'.
• Conforming Loan Limits in some counties have been increased (unfortunately Not in Worcester County).

So what does it mean for Sellers?

• You MUST price your property correctly for The Current market we are in!
• You MUST have your properties Marketed aggressively!
• Your property MUST be Better than every other that you are directly competing against!

So what does it mean for Buyers?

• You have a Great Opportunity right now!
• Mortgage Rates are Historically LOW!
• There are Many Homes for you to choose from!
• You are 'Buying Into a Down Market'!
• Your lender does NOT want to put you in a situation where you will face foreclosure!
• The Real Estate Market will go up again - not sure when - but it will!

So Remember The Following:

• ALL Real Estate is LOCAL!
• Nobody will see 'The Bottom' until we are past it!
• Mortgage Interest Rates Cannot stay this low Forever!
• The Real Estate Market is Worse in some parts of the country and is Better in others!
• The "media" cannot sell 'The Middle' of any story. Only extremes can sell papers/tv/etc... so they always report on the worst!
• Always use the most Knowledgeable and Reputable Realtor that you can find to assist you if you are selling OR buying!

When is a Clause Not a Clause...

Language is Very important; in life, in love and in real estate. For those who are not represented by Legal Counsel (read: Attorney, Lawyer, etc.) a keen understanding of Language is extremely important! So is the importance of having legal counsel.

Read this clause for example:
"Subject to the Seller entering into an accepted offer on a property within 'X' days of acceptance of this offer."

If the Seller enters into an accepted offer on their new property within the specified time frame but the Seller's deal on their new property falls apart at some point before closing, what happens:
A) The sale on the Seller's house they are in now terminates.
B) The Seller must go through with the sale to the current buyer on their present property.

What do you think (and why)?

Have You Seen one of the Finest Homes in Central MA?

There are Few homes like this one... And even fewer Opportunities to be able to Own One!

Buyer Activity Increasing in Central MA

As of the past week I, as well as my agents at Towne & Country, Realtors, have seen an uptick in buyer activity. Internet inquiries as well as phone inquiries have increased significantly. Showings are up across the board and offers are not only being seen but several have been accepted or are in negotiations.

It appears that buyers are taking advantage of the combination of low mortgage rates and soft prices.

Properly priced homes will still sell in this market.

Keep educating yourself on the market because when it turns we will be past 'the bottom' of the market before anyone will see that we were 'there'.