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For home buyers it is a good time to push for lower closing costs which includes lending charges, local tax and transfer fees, and expenses for such things as title insurance, appraisal costs, and other third-party services. The rule of thumb used to be about 3 percent of the cost of the property.
According to Guy Cecala, publisher of industry newsletter Inside Mortgage Finance, Fees that buyers shouldn't have much trouble negotiating away include wire-transfer fees, loan application-processing fees, and high FedEx charges. Today, most buyers should be able to do better than that, added Guy Cecala.
Cary Pearce, production manager at Provident Bank Mortgage in Riverside, Calif says that it all boils down to what a lender will work for.
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It is a returning phase for New York's big-buck buyers as they retreat to Long Island's seashore getaway.
According to a report released by Prudential Douglas Elliman Real Estate the first-quarter home sales in the Hamptons were up 173 percent over the first quarter of 2009 and median sales prices rose 35 percent to $908,500 compared to the same time period last year. The report was released on Thursday.
Prudential Douglas Elliman said prices were higher closer to the Atlantic, rising 86 percent for homes south of Montauk Highway. This would run east west a few blocks from the shoreline.
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According to a survey of more than 1,500 real estate practitioners by Campbell/Inside Mortgage Finance, nearly half the homes sold in March were purchased by first-time buyers. This would come up to 48.2 percent.
Thomas Popik, research director for Campbell Surveys, said in a statement that many observers had felt that the pool of first time home buyers had been depleted last fall. "Instead, the normal spring-summer buying season is combining with the tax credit to produce blow-out results for first-time home buyers", he added.
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According to a top administrator of the Troubled Asset Relief Program (TARP), the recent changes to the program could lead to increased fraud. In a quarterly report issued on Tuesday the program's Inspector General Neil Barofsky says that frequent changes to the programs provide opportunities for experienced criminal elements to prey on desperate homeowners.
The program has already spawned several scams in which borrowers are fraudulently persuaded to pay upfront fees for nonexistent modifications, added Barkofsky. He complained that the Treasury Department isn't requiring appraisals in advance of principle reductions, making it easier for lenders to fraudulently qualify for incentive payments.
The report concluded that No program of this type and scale can be considered well designed without robust protections of taxpayer funds against the predation of criminals.
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According to LPS Applied Analytics, the number of delinquent mortgages declined 8.6 percent in March. The Analytics which tracks the performance of loans for investors reports that the totals also declined in February.
The loans more than 30 days past due showed the biggest decline. Such loans are now at about the same level as they were in spring 2008.
LPS Applied Analytics President Ted Jadlos says that this is the first time they have seen improvement across all stages of mortgage delinquency. "We're not out of the woods, but this appears to be a turning point", Ted Jadlos added.
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According to the Commerce Department the housing starts rose 1.6 percent in March to an annualized rate of 626,000. The department revealed the findings on Friday.
Compared to March 2008, the building permits were up 34 percent. The building permits are considered as a leading indicator. In addition permits for single-family homes also rose 5.6 percent compared to March 2009.
In March, the National Association of Home Builders/Wells Fargo confidence index rose to 19 from 15. Any number below 50 indicates that the majority of respondents are discouraged.
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According to the Colliers International's first survey of global investor sentiment, the real estate investors worldwide are convinced that the market is at or near bottom and about to shoot up.
The investors from Asia, Canada, Latin America, and Western European think favorably stating that the financing is increasingly available. But the investors in the Middle East and Eastern Europe make the opposite observation.
The majority of respondents say their respective markets will return to "normal" within 18 months. However, there was considerable disagreement about what can be referred as "normal". At the same time rents are anticipated to hit bottom this year globally. The first quarter of 2010 for the office sector was the most frequently offered response, followed by the second quarter of 2010 for industrial, and the third or fourth quarter of 2010 for retail.
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According to Equifax and Moody's Economy.com, the percentage of delinquent mortgages declined to 6.57 percent in the first quarter from 6.60 in the last quarter of 2009. Since the first quarter of 2006, this is the first decline in the delinquency rate.
Mark Zandi, the chief economist for Moody's says that the decline foreshadows a peaking of the foreclosure crisis. The economists suggest that the reasons for the decline would likely be the tougher lending standards, mortgage modification efforts and a more stable job market.
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According to MortgageDaily.com more than twice many federally insured banks have failed this year. Around 42 banks have had the fate compared to 21 that went belly up by this time last year.
From January 1st to April 9th, the mortgage-related closings totaled 55, including non-bank lenders, banks, and credit unions. At the same time last year, 50 closings had been tracked.
The losses were projected at $353 million for notable institutions like Florida Community Bank and Horizon Bank projected to lose $539 million. The FDIC expects Appalachian Community Bank to lose $539 million.
The MortgageDaily.com publisher Sam Garcia says that they saw regulatory actions against U.S. financial institutions nearly double between the first-quarter 2009 and this year, suggesting the acceleration in bank failures is unlikely to abate. "However, a thawing of the market for mortgage-related assets could help move some institutions out of the 'troubled' category.", Sam Garcia added.
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In January the distressed properties accounted for 29 percent of all U.S. home sales, reports First American CoreLogic. The real estate-owned sales rose to 22 percent of homes sales from 19 percent in December. Also the short sales rose to 8 percent from 7 percent.
The average sale prices for distressed homes were $161,600 in January. This is high compared to the average non-distressed sale price of $247,700, $141,900 for REO properties. And the sales price was $215,300 for short sales.
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According to the IRS, taxpayers who are married and filing jointly can't deduct interest on more than a combined total of $1 million of home acquisition debt for a primary and a secondary residence. This should be kept in the mind of second home purchasers.
The home equity debt on the first and second homes may be deducted up to a combined total of $100,000 for the tax payers. After refinancing, a home owner can only deduct interest on the original amount of the loan at the time they refinanced, plus $100,000.
If the money was used to buy or improve their home, the buyers and refinancers also can deduct loan fees or the so called points. But they are not allowed to deduct them if they refinanced to lower the interest rate.
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Based on Fannie Mae national housing survey, 65 percent of Americans would still prefer to own a home rather than rent. This trend is in spite of the challenges facing the housing market.
According to the survey, safety has been considered as the key reason by 43 percent of respondents while 33 percent are motivated to buy because they perceive schools to be better in neighborhoods where most homes are owned by their residents.
In addition, the survey cites that both buyers and renters are more cautious than they used to be. The survey results released on Tuesday reveal that about 23 percent of renters say they will buy a home, but later than they once hoped.
A full 70 percent thinks that buying a home continues to be one of the safest investments available. However, 74 percent believes that putting money into a bank account is safe. Only 17 percent believe buying stocks is a safe investment.
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According to research firm Reis Inc, the office vacancy rate in the United States reached 17.2 percent in the first quarter, the highest since 1994. The rate was 2 percent higher than it was a year ago. The asking rent had fallen 4.2 percent and effective rent was down 7.4 percent from a year ago.
The rents will continue to decline and vacancies rise through 2010 and probably 2011, expects the Reis analysts. However, Reis points out that tight credit markets have slowed office construction. This year, only 3.6 million square feet of new office space will be added. This is the lowest number of completions since Reis began keeping track of this data in 1999.
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The US labor market continues to be weak, indicates the jobs report released by the nation's Department of Labor on Friday. The employers have added 162,000 jobs in March and this is the largest gain since 2007. However, about 48,000 of them were temporary positions working for the Census. The unemployment rate held steady at 9.7 percent.
People without jobs don't buy houses, and some of the unemployed will be unable to pay their mortgages. This situation would have a serious impact on the housing market. According to the Mortgage Bankers Association's quarterly survey, the early-stage mortgage delinquencies may have already peaked. This is in fact a good sign. On the other hand, the pool of seriously delinquent loans continues to grow.
"Because of foreclosure moratoria, judicial backlogs, and [modification] trial periods, many loans are languishing either in late-stage delinquency or in the foreclosure process and could add to [bank-owned] inventories in the coming year", warns Freddie Mac Chief Economist Frank Nothaft. But he is being optimistic at the same time. Bookmark &
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