Why Buy Now? -- Fein Times in Real Estate

Why buy now?

Interest rates remain low, but may rise over time, the number of homes and condos on the market far exceed demand driving down price and the first-time home buyer credit of up to $8,000 expires the end of this year.

Interest rates: Mortgage rates jumped from about 4.5% to 5.4%. Not yet a deterrent but a call to act soon. The monthly cost already have increased about $55/month. Not a lot but it rates are projected to rise over time. Why buy now? a 1% increase in interest rates can wipe out a 10 percent drop in home price in a 30 year mortgage. Check out this YouTube video that provides a simple explanation on mortgage interest rates: or cut/paste: http://www.youtube.com/watch?v=_lnrH0WhCNo

Months of Inventory a Market Indicator:
Months of inventory is the number of months it will take to sell all the listings in a given market or neighborhood. Important to note in this equation is a large number of listings are priced well over current market price and the sellers won’t accept less. If those listings were eliminated, ‘months of inventory’ would decrease even further. A balanced market, meaning it is neither a buyer or seller’s market, according to industry analysts, is about six months of inventory. One factor suggesting the bottom is either here or near is the # of months of inventory is shrinking.

First time homebuyer tax credit of up to $8k?
Scroll down for an earlier blog post.

Your competition for that home or condo you want is heating up!

Florida’s existing home sales rose in May – the ninth month in a row that sales activity increased in the year-to-year comparison, according to the latest housing data released by the Florida Association of Realtors® (FAR). Also, for the first time in many months, the statewide median sales price in May for existing homes and for existing condos rose over the previous month’s figure.

Prudential Florida Realty Steps Up With Its Own Stimulus Package
Two major hurdles keeping today’s homebuyers on the fence even when market indicators show it’s a buyers market may be fear -- employment stability and concerns that prices may continue to decline. Prudential Florida Realty stepped in to overcome both obstacles.

The "Homebuyer Employment Guarantee" is a mortgage payment relief program facilitated by the in-house mortgage company, Florida Home Finance Group, an affiliate of Wells Fargo Home Mortgage. It is designed to protect homeowners from the most common cause of missed mortgage payments and foreclosures: Involuntary unemployment and /or disability. A $620 investment paid by either the buyer or seller will: Cover up to $2,000 per month, for 24 months for Principal, Interest, Taxes and Insurance PITI. Total maximum benefit payout is $16,000 over all.

Afraid you buy the house and need to sell before you have earned equity? Buy a ‘Price Guaranteed Listing’ by Prudential Florida Realty. If you need to sell within three years and the price declined, I won’t charge you the listing commission.

First time homebuyer tax credit of up to $8k?
Go to www.aventuracondosales.com, my blog, for more information. Since I posted that blog, a number of bills have been introduced in the House and the Senate that lobby for an expansion of the measure. Among the proposed changes:
Setting a new cap of $15,000.
Extending the tax break into mid-2010.
Making the benefit available to all home buyers, not just first-timers.
Offering a separate tax credit to $3,000 for borrowers who refinance.