Real Estate Information

The home prices have increased double digits in five year increments since 1980. 1980-85, 25%, 1985-90, 27%, 1990-95, 25%, 1995-2000, 29% AND 2000-2006…89%. We are NOW in a market of adjustment. The downturn in economy, increasing number of short sales and foreclosures and reduced number of qualified buyers are driving prices down. According to First American Corelogic in 10/09, “21% of Illinois mortgages are underwater”. Stan Humphries, Zillow’s chief economist says “The negative-equity will rise and spin off more foreclosures. I see a substantial downsize risk to prices and I don’t think we’ll see a bottom until the middle of next year”.

Now, to the question of waiting to sell your home; the current tax credit through April, 30, 2010 should stimulate buyers in the first quarter.  Business Week in 9/09 says “With any luck, three years should be long enough for the U.S. economy to recover and for the nation’s housing inventory to shrink to more normal levels.”

USA Today has looked at the housing situation by state.  Illinois' excess housing is predicted to be reduced by 2012 or later. If you want to sell or need to sell January through June 2010 seems to be a good time.  After that, we’ll have to wait and see how fast housing inventories will grow.  For more details, please contact us at piketteamrealtors@hotmail.com.

Writes Marc Roth with Businessweek.com. He goes on to say "you may not be stupid or broke. Maybe you already have a house and you don’t want to move. Or, maybe you are a Trappist Monk and have forsworn all earthly possessions. But…if you want to buy a house, now is the time, and if you don’t act soon, you will regret it. Here’s why...historically low interest rates!!”

Marc goes on to say “As of today, the average 30 year fixed rate loan with no points or fees is around 5%.”

You should also consider the large selection of homes and declining prices. It's like a candy store for buyers...for the time being. We expect that home pricing is beginning to stabilize. Once new construction kicks back in…we should see a slow rise in pricing.

Don’t forget the tax credits are good through April, 30^th with a close of June 30^th, 2010.  If you want more information or want to be set up on a home search, please email us at piketteamrealtors@hotmail.com or kevinpiket@johngreenerealtor.com.

The National Association of Realtors says that 500,000 short sales occurred in 2009. That is about one in ten homes sold this year. A short sale is the process where a troubled homeowner can sell their home below the mortgage balance with approval from the lender. The advantage to the lender is avoidance of the foreclosure process which is usually more costly vs. short sale. In most cases short sales take 90 plus days for lender approval. This is mostly due to clerical backlog due to the large number of short sale requests. Many short sales are cancelled due to buyer impatience. The process is also slowed when lenders nit pick Realtor's commissions. Many also try to hold the seller accountable for the debt in the future.

IS THERE A LIGHT AT THE END OF THE TUNNEL? YES AND IT IS NOT A TRAIN!!!

U.S. Treasury released new rules regarding short sales. New guidelines include $1,000 to $1,500 payments to homeowners to help cover moving costs and TIMELINES, and now has a more standardized process. Effective date for this new guideline is April 5, 2010.  In the interim buyers & sellers will just have to be patient.  To learn more about short sales, please contact us at piketteamrealtors@hotmail.com. 

Good question! As economic difficulties continue and the unemployment rate escalates, more homes will move into foreclosure. The 2008-2009 rounds of foreclosures were mostly due to questionable loans to many folks who went over their heads as interest rates adjusted and taxes increased. The next round will be prime mortgages going delinquent.

Neighborhoods will continue to be impacted by foreclosure pricing throughout 2010. BUYERS WILL CONTINUE TO HAVE THE UPPER HAND. Sellers with good equity or a need to move will continue to list and sell homes. The lenders will, most likely, begin to become more aggressive to fund buyers with good credit. However, all of this will lead to a major adjustment of home values in our market. The recommendation is to BUY!! The recommendation to sellers is to come on the market early, price your home to sell and get your home professionally staged for a successful and quick sale. 

If you want to learn what the value of your home is, please email us at piketteamrealtors@hotmail.com.  If you are looking to be set up on one of our free home searches, please email us at kevinpiket@johngreenerealtor.com.

The clock is ticking towards the new and extended deadline date for the first time homebuyer's $8,000 tax credit and the addition $6,500 tax credit for people occupying their previous home for 5 years. Circle April 30, 2010 on the calendar. All contracts need to be finalized by that date and they must close on/or before June 30, 2010.

Question: I owned my home for seven years, but sold it two years ago and I have been renting ever since. If I buy a home today will I qualify for the $6500 tax credit?

Answer: If you meet all the eligibility tests on income of $125,000(single) or $225,000(married), the purchase price is under $800,000 and you close before July 1, 2010........then yes you qualify. Also as long as you lived in the home 5 years straight, the 2 years rental period did not disqualify you.

Regarding the $6500 tax home buyer credit, does the new home purchased have to cost more than the current home you live in? Answer: No

I am eligible first time homebuyer and I entered into a contract to purchase on Nov. 1, 2009. Do I have to close before 12/01/2009? How does the extension affect me?  Answer: You do not have to close before Dec. 1, 2009 since the legislation has been signed. Therefore, as long as the contract is closed before April, 30, 2010 the purchaser will be eligible for the tax credit.

To keep up with the Homebuyer's Tax Credit follow our blog @ www.piketteamrealtors.com or email us at piketteamrealtors@hotmail.com.

According to the AP: "Buying a home is about to get cheaper for a whole bunch of homebuyers - $6,500 cheaper"!

First time homebuyers will continue to receive tax credits up to $8,000. The program intended to expire on Nov.30, 2009 has been extended to April 30, 2010 for sales contract. Homes must be closed by 06/30/2010 to qualify. In addition, buyers who have owned their current home for at least five years would be eligible for tax credits of up to $6,500.

The U.S. extended and expanded the bill yesterday. President Obama is expected to sign this week. For more details continue to watch this blog or email us at piketteamrealtors@hotmail.com

The Senate seems to believe it's a start! They have reached a compromise on extending and expanding the $8,000 tax credit for first time home buyers. According to Rismedia, "passage remains uncertain" however probable. The proposed legislation states that it would extend the tax credit for first time buyers who have a signed contract by April 30, 2010.  Those buyers will then have until June 30, 2010 to close on that home.  There may be a new tax credit of $6,500 for some existing homeowners who have been in their homes for five years over the past eight years. More details to come on that plan.

If the current resale inventory continues to decrease due to an increase in home sales....then new construction business could begin to rebound too. This means more jobs to help our economy grow. More jobs leads to more consumer spending and Real Estate definitely takes a lead in the recovering economy!!

Where are the real estate bargains?? Everywhere!!! Homes are the most affordable in years. Interest rates are still excellent. Soooooooo, what are you waiting for? Realtor's inventories are loaded with bargains. Most homes on the market have sellers who need to sell, transferees that need to move, short sales and foreclosures that banks want to get off their books. According to Rick Sharga, Sr. Vice President of RealtyTrac, "we're dealing with foreclosure activity that is six times what it would be in a normal market." We still have a "shadow inventory of perhaps 400,000 to 500,000 homes, which have been taken back by banks, but have not been put on the market for resale." The time for "thinking about it" is over. Roll up your sleeves and dive into this "bargain driven real estate market!"  If you are interested in being set up with a home search, please contact us at kevin.piket@johngreenerealtor.com or piketteamrealtors@hotmail.com. 

There is no doubt that the $8,000 tax credit stimulated a lot of sales this year. We certainly hope Congress sees fit to keep it going into 2010. However, it has stimulated a lot of hopes and wishes that went nowhere. Many folks definitely have a "trail of tears" and are frustrated trying to buy foreclosed and "short sale" properties using the tax credit. If you are planning to enter the market to purchase a foreclosed home, please know the following:

1. Get preapproved by a lender, in writing, before you start. Lenders are under pressure and very stingy with approvals.
2. You may have to compete with multiple offers for the really great buys. Be aggressive with you offer.
3. Many foreclosed properties need repairs. If serious, FHA loans may not qualify. Also do you have backup abilities or funds to repair?
4. Prices are still dropping. Appraiser may come in lower than sale price. Back to the negotiating table.
5. Check property taxes and condo feed, if applicable. May run more than mortgage payment.
6. "Short Sales" are a different ball game from bank owned foreclosed properties. The seller still holds title. Expect a minimum of 90 days for approval, "if approved".

Foreclosures are definitely worth buying. You just need to be prepared for the sequence of events that lead to a successful purchase. Make sure you work with a Realtor with foreclosure experience. You will avoid that "trail of tears"!  If you have more questions, please contact us at piketteamrealtors@hotmail.com.