The full report is quite long, but very interesting for those interested in the full findings the City of Austin will be studying as they move forward with development of our great city.

Highlights and analysis can be found at the Austin Contrarian.

Random Posts

• TEXAS Scholars Program and How YOU Can Help
• Austin Is The Place To Live- Night Life Showcase
• Mortgage Rates Lower But Fees Don’t
• No Gimmick- Reduce Your Monthly Payment When Purchasing Your New Home!
• Top 10 Reasons Austin First Home Buyers Should NOT Buy

Fed announces new fiscal support

The Federal Open Market Committee voted to leave the Fed Funds Rate unchanged today, within the target range of 0.000-0.250 percent.  This doesn’t mean the Fed stood pat, however.

On plan to resurrect the economy using “all available tools”, today, the Fed announced a new, $1.5 trillion round of fiscal support for the treasury and mortgage markets.

The stimulus will likely be Thursday morning’s headline story.

Too far gone to save? Huh?

In its press release, the FOMC touched upon a few of the prevailing economic issues, using these points as a legitimizing backdrop for its newest debt load:

• Job losses and wealth loss are dragging down consumer spending
• Some U.S. trading partners are falling into recession
• Businesses are cutting back on investment and inventory

Of interest is that the FOMC said today’s inflation levels may be too low to support economic growth at all.  This condition is more commonly called deflation.  The Fed’s latest actions, therefore, may be a deliberate attempt to induce inflation through unprecedented borrowing.

GOOD News for home buyers?

For home buyers and potential refinancers, this is terrific news — at least in the short-term.  By introducing new demand for mortgage bonds, the Fed will help pressure mortgage rates lower.  Already this afternoon, mortgage rates fell and they will continue to fall until the market reaches a new equlibrium.

After the Fed’s last intervention, markets reached their balance point in about a day-and-a-half.

Source: bringtheblog

Related Reading…

• Austin Homebuyers Glad Dow is Under 10K?
• Do You Qualify for Mortgage Relief?
• The First-Time Homebuyer Credit Form
• Mortgage Rates Lower But Fees Don’t
• Austin Lending, Zero Down & Home Buyers

Extend the life of your AC

Changing your air filters regularly keeps your household energy costs down and extends the life of your HVAC unit(s).  It’s important, however, to use air filters that actually work. 

Walk into any hardware store and you’ll see a host of filters at various price points, starting at 99 cents.  Before you reach for the cheapest products, though, watch the 1-minute video above.

Mesh = no bueno

A mesh filter isn’t going to stop most airborne particles. Because buying the recommended pleated air filters can be expensive, consider purchasing in bulk from a store like Home Depot, or from Amazon.  Air filters don’t “go bad”, you can store your discounted filters until they’re ready for use.

Experts recommend changing air filters quarterly at minimum.  If your home has shedding pets or is dust-prone, consider changing them monthly.

Random Posts

• Williamson County “Top 10 Best Districts for the Buck”
• So you want a huge lot? Are you sure?
• Austin Is The Place To Live- Peace & Quiet Showcase
• Austin Is The Place To Live- Weather
• 10 Mistakes Sellers Make

Supply & Demand

If you asked an economist why home prices have broadly fallen over the past 2 years, you’d get a short lesson in Supply and Demand.

Too many homes for sale and not enough people to buy them pushed values lower until a balance point can be reached.

Looking at the chart, that balance point may be fast approaching.

According to data compiled by ZipRealty, the total number of homes listed for sale fell in February 2009 in 23 of 24 major housing markets. 

Abnormal numbers

This is an especially important data point because home inventories typically rise in February, ahead of the Spring Home-Shopping Season. 

Since 1982, February home inventory has been up 3 percent on average. Last month, it fell.

So, in support of the Supply and Demand Theory, we shouldn’t be surprised that the rate of price decline as shown by the Case-Shiller Home Price Index is easing in a lot of markets, too.

We may not have reached the housing market bottom yet, but if we haven’t, the data shows us we could be close. Austin is at the very bottom of the list, but we never quite overheated like California. This will be interesting to watch and we’ll keep you updated!

story source: bringtheblog

Related Reading…

• 10 Mistakes Sellers Make

Austinites, do you qualify?

When the White House first introduced the Making Home Affordable program in February, it was positioned as a mortgage program with two goals:

1. To help financially-needy homeowners get mortgage relief
2. To help homeowners who’ve lose equity qualify for today’s low rates

Wednesday, in a much-anticipated announcement, the U.S. Treasury introduced new details about Making Home Affordable. 

It also created an ”Am I Eligible For Making Home Affordable” form on its website.

President Obama’s blueprint

In the press release, the Treasury detailed the President’s original blueprint.  Namely, it provided explicit loan modification instructions that will assist up to 4 million delinquent homeowners and their respective mortgage servicers.  

The modification guidelines are a thorough 17 pages long and leave little question about the loan modification process, and how it must be carried out.

But for as much ink committed to helping delinquent homeowners, the Treasury gave surprisingly little guidance to the estimated 5 million homeowners for whom deteriorating home equity has rendered refinancing impossible. 

Uh, who is in the 5 million???

For these Americans, the Treasury instead offers a basic Q&A and directs homeowners to call Fannie Mae and/or Freddie Mac to confirm their eligibility. The “refinance plan”, in summary, says that a homeowner who has paid his mortgage as agreed and whose home value is “about the same or less” as the amount owed on his first mortgage may be eligible.

That’s about as much as the Treasury could say.

If after browsing the website, you still have questions about the Making Home Affordable program, email us.

story source: bringtheblog

Related Reading…

• Explaining What The Federal Reserve Did In Plain English
• The First-Time Homebuyer Credit Form
• Mortgage Rates Lower But Fees Don’t
• Austin Homebuyers Glad Dow is Under 10K?
• Austin Lending, Zero Down & Home Buyers

First Time Homebuyers in Austin

As part of the American Recovery and Reinvestment Act of 2009, the IRS has officially released Form 5405 – better known as the First-Time Homebuyer Credit Form.

True to tax code standards, the 10-field form is accompanied by 3 pages of instructions.

Form 5405 is a helpful, go-to resource for home buyers with questions about the tax credit.

For example, the form distinguishes tax consequences for homes bought in 2008 versus 2009, and clearly defines the term “first-time home buyer”.

How it works:

In addition, Form 5405 highlights the math behind the tax credit.  In general, the First-Time Homebuyer Credit is equal to the lesser of:

• $8,000 for homes bought in 2009
• 10 percent of the home’s purchase price

Married couples filing separately are entitled to half of the expected credit, and homes sold within 3 years are subject to a credit repayment in the year the home ceases to be the “main home”.

Form 5405 is a comprehensive reference.  However, be sure to check with your accountant for specific questions about your personal returns and how the First-Time Homebuyer Credit may impact your finances.  There is no substitute for professional, paid advice.

content source: bringtheblog

Related Reading…

• Explaining What The Federal Reserve Did In Plain English
• Do You Qualify for Mortgage Relief?
• Mortgage Rates Lower But Fees Don’t
• Austin Homebuyers Glad Dow is Under 10K?
• Austin Lending, Zero Down & Home Buyers

Should Austin Be Nervous?

Do you need to sell your house in 7 days and aim to make a 70% profit over what you bought it for with zero down last year? You should probably be nervous. Are you looking to buy a home or list your home for a reasonable price? You might be fine. Look, things are nasty in the American economy, but there are amazing deals out there AND if you’re not looking to make a ridiculous profit on a home you just bought, even listing a home isn’t a major panic right now, just know that your home may ride the market a little longer now than a year ago.

Gimme the numbers already!

Okay, okay! The most recent annual MLS data based on sold inventory between 2/1/2008 to 1/31/2009 (which is just one snapshot of data) shows:

• Average sales price: $244,233
• Average days on market: 90
• Number of homes sold: 20,595
• Months of inventory*: 6.2

*Months of inventory is an estimation of how long it will take for all the market’s homes to be sold based on how many homes are currently on the market and the rate homes have sold in the past.

Currently, there are 10,642 homes for sale in Austin. Granted, the MLS areas are not equal in size, the largest number of active listings is 748, located in the “LS” area which is the south shore of Lake Travis (see map here). The area with the longest days on market is “LW” on the map, the Dripping Springs/Blanco area west of Lake Travis coming in at 199.9 average days on market while “10S” (the William Cannon/Mopac area) has the lowest average days on market at 47.99 days.

Related Reading…

• 3 DIY Projects That Can Help Your Home Sell For More
• City Survey- Opine About Downtown’s Future
• Austin Retail Affects Residential Home Sales
• Austin Housing Starts Slow Down
• Austin Lending, Zero Down & Home Buyers

Relax, it’s not all bad news

Using anonymous data from its national credit database, TransUnion reports that 4.58 percent of American homeowners were at least 60 days past due on mortgage payments last quarter.

Comparing the statistic to the data from a year ago, the credit reporting agency goes on to say that mortgage delinquencies are up 53 percent.

Although fair, the comparison carries a distinct, negative connotation because if we flip the data to its positive, the statistics don’t seem nearly as menacing.

A positive sign!

Consider: In the last quarter of 2008, 4.58 percent of homeowners were delinquent on their respective mortgages.  The positive sign, therefore, is that 95.42 percent of homeowners were not delinquent on their home loans.

Furthermore, in looking at TransUnion’s data for the 5 largest states in the Union, it’s clear that the national delinquency rate is being skewed by California and Florida.  New York and Texas, for example, exhibit delinquency rates below the national 4.58 percent marker.

North Dakota’s delinquency rate hovers near 1 percent.

Headlines are designed to attract eyeballs and nothing else. To get the complete story, therefore — the real story — it never hurts to dig a little deeper into the facts.

(Image courtesy: TransUnion). Content source: BringTheBlog.

Related Reading…

• What If MY Mortgage Lender Fails?

Tips, tips, tips!

In a tight economy, do-it-yourself home improvements projects not only save money, but may also justify a higher listing price for a soon-to-be home seller.

In the 4-minute video above, Sweat Equity host Amy Matthews talks with NBC’s Matt Lauer about affordable home upgrades that even the least skilled home remodelers can finish on their own.

Three of the huge, bang-for-the-buck projects discussed are:

• Refinish laminate countertops for $95.
• Replace hollow “builders’ doors” with sturdy doors for $200 each.
• Install kitchen and bathroom backsplashes for $500 each.

The video also recommends installing a basement egress window, if possible. As far as DIY goes, it’s a little bit more complex but the results are stunning.

Content source: BringTheBlog

Related Reading…

• Austin Real Estate Statistics
• City Survey- Opine About Downtown’s Future
• Austin Retail Affects Residential Home Sales
• Austin Housing Starts Slow Down
• Austin Lending, Zero Down & Home Buyers

Housing recovery

One popular housing theory is that — before a bona fide housing recovery can begin – the cost of owning a home versus renting one must return to historical levels.

If that belief is a truth, a national return to rising home prices may be in store for 2009. 

Falling home prices coupled with falling mortgage rates, too, have dropped the relative, after-tax cost of owning a home to 125% of the cost of renting a home.

It’s been a while…

This is the exact 18-year historical average and not since 2001 has the gap been this small.

As reported by the Wall Street Journal, though, the study has some flaws.  For example, the data doesn’t account for ongoing home maintenance costs, nor does it consider real estate tax bills and insurance policies. 

But, combining a relatively low cost of ownership with the government’s $8,000 tax credit for first-time home buyers is likely to convert long-time renters into never-before homeowners.

This, too, is thought to be a key element of the housing recovery.

In many markets (but not all), home prices are expected to edge lower through 2009.  Provided mortgage rates stay low, the cost gap between owning and renting will shrink even more.

Image courtesy: Wall Street JournalContent source: BringTheBlog

• Austin Tree Lightings & Outdoor Ice Skating
• Hunger in Austin- Take Action!
• Austin Lending, Zero Down & Home Buyers
• How to Negotiate With a New Home Builder
• Why Austin New Home Builders & Resellers Prefer Pre-Qualified Buyers