Daily Star Publishes Article on Local Real Estate Market

On Wednesday 5/28/08, The Daily Star published an article written by Denise Richardson, staff writer, titled: “Officials: Local Market Brighter”.

Here's the text of the article:

The market outlook for existing-home sales in the state and region isn't as gloomy as a national study released Tuesday suggests, officials of the New York State Association of Realtors said, though buyers are at an advantage.

Standard & Poor's/Case-Shiller said its national home-price index fell 14.1 percent in the first quarter compared with a year earlier, the lowest since the index's inception in 1988. The quarterly index covers all nine U.S. Census divisions.

However, the New York State Association of Realtors last week reported statewide sales of existing single-family homes increased by 14 percent in April compared with March, which ``bodes well for the future.''

"All real-estate markets are local, and it's no different here in New York state,'' said Duncan R. MacKenzie, NYSAR chief executive officer said in a media release. ``While reports of the so-called `national' housing market's demise abound, overall, New York's housing market is performing well, with sales gains being reported in more than two-third of our counties. This month-to-month growth in sales bodes well for the future as we enter the traditionally active late spring and summer months.''

Homeowners in New York on average own their residences for seven years, NYSAR officials said, and over that time, equity has increased. The median price was about $110,000 in April 2001, compared with $215,000 last month, officials said.

Though data show declines in sales in Otsego and Delaware counties from last April to this April, officials expressed optimism about the market as the traditional busy season begins.

Sal Prividera, spokesman for Albany-based NYSAR, said the inventory of existing homes is good, prices have decreased but not ``dropped out'' and mortgages still are at near-historic lows. These factors combine to make it ``an absolutely great time'' to be in the market, especially for buyers, he said.

The housing market in New York state hasn't been tied to an industry, such as Detroit and its dependence on auto manufacturers, or had a boom like California, NYSAR officials said.

According to a May 23 media release reporting preliminary data, Realtors statewide sold 5,838 homes in April, up 14.4 percent from 5,035 homes sold in March, though down 14.7 percent from 6,845 sold in April 2007.

The April 2008 median sales price of $215,000 represents a 2.5 percent increase from the March median of $209,800, NYSAR said; the April 2008 sales price is a 12.2 percent decrease from $245,000 of April last year.

Data don't include homes not sold by a Realtor, who is registered with the not-for-profit trade group, which in New York has 61,000 members.

However, NYSAR officials said the current market calls for sellers to set a ``right to the market'' and not an inflated price.

Buyers are more savvy than 10 years ago about the market because they do research on the Internet, said Ross Gill, president of the Otsego-Delaware Board of Realtors. With more buyers aware of market conditions, there are fewer offers and fewer bidding wars for homes than a few years ago, he said, and it's critical for sellers to do homework to find out values of neighboring homes and seek appraisals.

Sellers also must factor into their price how fast they want to sell their home, said Gill, an associate broker with Hawley Realty in Delhi. For example, by working with owners who wanted to sell their home in about three months, they set a right-to-market price and it sold at the asking price of $399,000 within 48 hours, he said. The home was a federal-style reproduction built in 1986 on 15 acres along Turnpike Road in the town of Meredith, he said, and the closing was Thursday.

Gill, referring to trade literature, said the outlook for the real-estate market is better for the second half of the year, and for next year better than this year.

``This is a very good time for buyers,'' Gill said.

Subprime Crisis Nearing End

Quote of the Week

This week's quote has to do with self-discipline. Without it we fail; however, with it we conquer the things that seek to master us and as a result grow to new and higher heights.

Here's the quote:

"The first and best victory is to conquer self."

— Plato, Greek Philosopher

Yes, There is Good Real Estate News!!!

Not sure if there is any good real estate news? Think again...

Leon d’Ancona, president of IMS Inc., delivers nothing but good news about real estate. Just take a look at his website (http://www.happyrenews.com/) that lists 2,319 markets in the United States where homes are selling well.

For instance, White Plains NY, homes sold 12.7 percent faster in April than they did in March, and sales of homes in Middletown NY (Orange County), increased by 37.9 percent in April compared with March. The average sale price of homes in Newburgh NY is up 2% in April compared to the prior month.

"The problem with glass-is-half-empty stories is that they have an undue psychological impact on markets that is not borne out by all the facts," says d’Ancona. "We know, because it's our business to know, that there are hundreds of cities and thousands of neighborhoods in the United States right now where the market is very healthy, thank you.”

California Pursues Statewide MLS

Inman News reported on 5/30/08 Board members for California MLS, a nonprofit, wholly owned subsidiary of the California Association of Realtors®, will begin the process of reviewing and selecting a vendor to operate a statewide property database that may emerge as the MLS database for Realtors®.

The CALMLS announced that 61 MLSs and local Realtors® groups have sent non-binding letters of intent to participate. California has a total of 70 MLSs.

Realtors® in California will be able to use the statewide database as their primary MLS database or continue to maintain and participate in a separate MLS.

The anticipated launch date for the statewide MLS is sometime either by the end of this year or the first quarter of 2009. The statewide MLS will have uniform rules and brokers as well as agents will be able to access the statewide system by joining a participating Realtor® Association or MLS.

The catalyst for a statewide MLS has been the multiple sets of MLS fees, rules, and forms that members have had to abide by in being members of more than one MLS. The statewide MLS is designed to streamline and simplify this with one set of fees, rules, and forms.

While many Realtors® are positive about the emergence of a statewide MLS, others are fearful of the potential loss of jobs as well as the entrance of outside agents seeking to sell properties in local territories. However, on the positive side, it will also assist brokers who have multiple offices throughout the state. It will also make referrals easier and locating properties in other areas of California a lot easier for participants.

The California Association of Realtors® is a trade association representing more than 185,000 Realtors® statewide.

Additional information about the statewide MLS can be found at http://mlsinput.car.org.

New-Home Sales Surge in Northeast

REALTOR® Magazine Online Edition Daily Real Esate News for May 28, 2008 reports:

Sales of new homes were up 3.3 percent in April, the first increase in six months, according to the U.S. Commerce Department’s monthly report.

The rebound reflected a 41.7 percent surge in demand in the Northeast. Sales were up 8.3 percent in the West and 5.8 percent in the Midwest. They fell by 2.4 percent in the South.

The inventory of unsold new homes was down slightly to 10.6 months’ supply at the April sales pace, compared with 11.1 months in March.

The increase brought sales to a seasonally adjusted annual rate of 526,000.

The median price of new homes sold in April fell to $246,100, down 4.2 percent compared with April 2007.

Source: The Associated Press, Martin Crutsinger (05/27/08)

30 Year Mortgage rates Rise Past 6%

According to REALTOR® Magazine Online Edition, The San Francisco Chronicle (05/30/08) reports that Freddie Mac reports a jump in the 30-year fixed mortgage rate to 6.08 percent during the week ended May 29 from 5.98 percent the prior week, marking a two-month high triggered by investor concern over inflation.

The 15-year mortgage rate climbed to 5.66 percent from 5.55 percent over the same period, while the five-year adjustable rate rose slightly to 5.62 percent from 5.61 percent. However, the one-year ARM slipped to 5.22 percent from 5.24 percent.

In the event of worsening inflationary pressures, Federal Reserve Bank of Dallas President Richard Fisher says, "I would expect a change of course in monetary policy to occur sooner rather than later, even in the face of an anemic [economy]."

Home Sales Begin to Rise in Some Hard-Hit Markets

REALTOR® Magazine Online Edition Daily Real Estate News May 27, 2008

Although nationally, home sales are still on the soft side, new data shows an uptick in several of the areas — including Fort Myers, Fla.; Las Vegas; Sacramento, Calif.; and inner-city Detroit — hit hardest by foreclosures and falling prices.

Americans generally remain wary of further declines in residential prices, but the data from these areas suggest buyers are finding the bargains too enticing to pass up.

Thomas Lawler, a Virginia-based housing economist, says home sellers "have moved into the acceptance mode" and are pricing properties more realistically.

DataQuick Information Systems calculates that sales of single-family homes in California's Sacramento County totaled 1,669 last month, a 41-percent jump from a year earlier as the median sales price fell 34 percent to $226,250.

Meanwhile, the Greater Las Vegas Association of REALTORS® reports that properties being sold by lenders account for more than 50 percent of recent sales.

Source: Wall Street Journal, James R. Hagerty (05/27/08)

NAR & DOJ Resolve Dispute

NAR has reached a favorable settlement with the U.S. Department of Justice, resolving the litigation between them over the display of listings from the MLS on brokers' virtual office Web (VOW) sites.

The final order, to be filed with the federal district court in Chicago today, validates NAR's long-standing Internet data exchange (IDX) policy and strengthens the membership rules governing multiple listing services.

"This is clearly a win-win for the real estate industry and the consumers we serve," says NAR President Richard F. Gaylord. "Today I can say with clear knowledge, underscored by DOJ's settlement compromise, that the real estate industry is dynamic, entrepreneurial, and fiercely competitive".

The order caps a three-year long battle between NAR and the Justice Department, which filed a lawsuit against the association in 2005 calling it anti-competitive for brokers to have unlimited say in where and how their clients' listings are displayed on other brokers' VOWs.

The final order expressly provides that NAR does not admit any liability or wrongdoing, and NAR will make no payments in connection with the settlement. The terms of the agreement preserve and strengthen the MLS as a means for broker-to-broker cooperation intended to serve real estate professionals who list or sell property in that MLS.

"This will ensure that MLSs are used for what they were originally intended to do, which is help real estate professionals find buyers for people who want to sell their homes," says Laurie Janik, NAR's general counsel.

NAR will be reinstating an updated version of its VOW policy, which governs the use of MLS data for brokers who offer brokerage services online by requiring customers to register with the brokerage before they can search for homes. That policy was rescinded in 2005 when certain provisions were challenged by DOJ.

The revised policy continues to protect the rights of sellers who do not want their property or their property's address displayed on the Internet, and also protects sellers from having false information about their listings appear on the VOWs of a member of the MLS. Among other things, the revised policy requires brokers hosting others' MLS data on their site to turn off features — such as home value estimates and blogs — surrounding a listing at the request of the seller.

The agreement requires MLSs and local associations that operate MLSs to pass and implement the amended VOW policy within 90 days of the court's approval of the final order.

The revised policy comes at a time when brokers appear to be moving away from the VOW business model. "The response to VOWs hasn't been great because consumers can find sites throughout the Internet on which to gather information without having to register their name and contact information," says Mark Lesswing, NAR's chief technology officer.

Read more about the DOJ settlement and related issues at REALTOR.org. Source: NAR

More MLSs Share Data With Public Sites

REALTOR® Magazine Online Edition, Daily Real Estate News May 13, 2008

Cooperative agreements between multiple listing services and Web sites like Zillow.com, Terabitz.com, ZipRealty.com and Redfin.com are becoming more common, giving home buyers unprecedented access to property information.

A greater online presence reflects practitioners’ increasing comfort with the Web, observers agree. “This industry is steeped in tradition, so the evolution has been gradual. But I think it’s definitely snowballing now,” says Jorrit Van der Meulen, a Zillow vice president.

The inclusion of bank-owned properties on independent sites has increased the sale of these kinds of homes, says Glenn Kelman, CEO of Redfin. He estimates that foreclosure-related transactions have in recent months accounted for 40 percent of sales in some markets.

“It’s a natural evolution of competition and what consumers want,” says C. Robert Hale III, chief executive of the Houston Association of REALTORS®, which operates the area’s MLS. “The consumer wants to see everything.”

Source: The New York Times, Bob Tedeschi (05/12/2008)

Don't Forget Those Who Paid The Price For Our Freedom -Memorial Day

No matter who we are; our politics, race, creed, color or religion, we are all Americans and need to remember those who served and died so we may live in peace and freedom. Let's honor those who honor us.

Overcoming Adversity

This is a very inspirational video concerning the ability to overcome challenges and obstacles. Fortunately, most of us do not have circumstances like the those of the father and son in this video, which means that if they can overcome the odds, so can you. I hope this video encourages, inspires and strengthens you. Enjoy!

How To Master Selling

Housing Report for April & Commentary You Need to Know!

Sales of existing single-family homes in New York State in April increased 14.4% (5,838 sales) compared to sales in March (5,035 sales). Compared to April 2007 (6,845), sales were down 14.7%.

The median sales price for April 2008 is $215,000 which is up by 2.5% from the March median price of $209,800. April’s median sales price compared to April 2007 ($245,000) is down 12.2%.
Sales gains for April were reported in 43 counties. Compared to sales gain in April 2007, 10 counties experienced growth. 29 counties gains in the median sales price compared to March 2008. Compared to April 2007, 30 counties posted gains.

“It is important to remember that all real estate markets are local, and it’s no different here in New York State,” said Duncan R. MacKenzie, NYSAR chief executive officer. “While reports of the so-called ‘national’ housing market’s demise abound, overall New York’s housing market is performing well with sales gains being reported in more than two-thirds of our counties. This month-to-month growth in sales bodes well for the future as we enter the traditionally active late spring and summer months.”

New York’s housing market continues to outperform the overall national market concerning sales of existing homes. While NY is up 14.4% for April, NAR reported a 0.5% decrease in single-family home sales for the same month. Also, while sales are down by 14.7% when compared to April 2007, this is still better than the national average of a 16.1% decrease.

Single family home owners have done very well over the last 7 years (the average length of time that homeowners have owned their homes according to a NYSAR commissioned study), in terms of their equity and price appreciation. In April 2001, the median price for a single family home in NY was $109,995. In April of 2008 it is $215,000. This represents a total increase of 95% during this period of time! It also represents an average annual increase of 13.57%. Compared to the S&P 500, during the same period of time, it’s average annual growth rate has been a meager 2.66%.

-The information herein is based upon the NYSAR New York State Housing Market Report dated 5/23/08 with additional information by Ross Gill.

Quote of the Week

"It is not what we get. But who we become, what we contribute ... that gives meaning to our lives."

— Anthony Robbins: Authority on leadership psychology

Listing Sydication Gets Easier

Posting your listings online should be a standard procedure. From a marketing point of view, the more places a listing appears, the better. The downside is that if you want your listings on half a dozen sites, you have to enter listings manually on each site or invest money in developing an automated system. And if the price changes, you’ll need to update each site individually. So even if you want your listings everywhere online, the amount of time you have to invest in posting and updating often makes widespread listing aggregation more trouble than it's worth.

Fortunately, some powerhouses in the listing aggregation realm recognized this problem. In January 2008, Google, Yahoo, Zillow, and Trulia began working together to create a single, standardized feed that would facilitate the marketing and advertising of properties on multiple Web sites. With help from the National Association of REALTORS® and the newly formed Real Estate Standards Organization (RESO), they've achieved their goal in record time.

The key to making standardization a reality is determining which data elements create the basic feed for each site and then developing a specification around those elements. The final specification contains fewer than two dozen required fields and only about 100 fields in total. To make it more robust, the specification very closely parallels, and draws from where possible, the existing Real Estate Transaction Standard (RETS) Data Schema developed by RESO in conjunction with MLS vendors and other industry stakeholders. However, this RETS schema is much more comprehensive, containing more than 1,000 data fields.

Already the new standard is having an effect. More than a dozen other listing sites and vendors have joined the RETS syndication workgroup and will begin accepting or implementing this universal listing feed in the near future. For real estate practitioners, this collaboration means that property information has to be changed in only one place to reach all participating sites. You save time and prospective buyers always have the most current and accurate property information.

In time, the new syndication specification could also be adopted by MLS systems. If this occurs, the MLS could become the single point of data transfer to all listing sites. The process would be similar to the way listings are now fed to REALTOR.com® but would occur across a much broader scope of sites.

Going one step further, a joint project between CRT and New England-based MLSPIN is developing a simpler data exchange method that’s more closely geared to listing syndication than RETS. This work is very similar to the successful and easily implemented data transfer that sites such as Trulia and Zillow have been working with for the last couple years.

The goal of the RETS Syndication Specification and the new streamlined data exchange method is to minimize the time and effort real estate practitioners must spend to transfer listings geared around advertising and marketing. This change will ultimately increase listing exposure while reducing the burdens of technology and cost.

-This article is written by Chris McKeever and is from NAR's Center for REALTOR® Technology (CRT) newsletter for Spring 2008

Inflation: Winners and Losers

by Lawrence Yun, Chief Economist, NAR Research

Inflation

Recent news on inflation is not good. In the first quarter of this year, the Consumer Price Index posted its highest level in years. A story in The Wall Street Journal last month carried the headline: "Inflation, Spanning Globe, is Set to Reach Decade High." We've all felt the effects in higher costs for food, energy, and other consumer goods.

Inflation is rather like a "stealth" tax: you have less purchasing power when it is high. However, if someone is paying higher prices, then someone on the other side must be receiving higher revenues. Many salary adjustments are based on the consumer price index, and entrepreneurs and businesses receive higher revenue. Mentally, though, people believe a rise in income is the reward for hard work, and feel the rise in consumer prices just eats into that hard-earned income. So, of course, inflation is awful.

But economists do not like inflation for other reasons. Large movements in prices distort price signals and lead to less efficient allocation of resources. Lower productivity growth holds back the country's economic potential and standard of living.

In the real estate sector, however, inflation produces distinct winners and losers. Let's take a look at both sides.

Homeowners Win

Rising inflation - other things being equal - raises people's income and their home prices. Usually, the increases would be nominal in terms of what you actually receive in paychecks and the listing price you would set to sell your home. Of course, we are not in normal times. Along with very high housing inventory, we have CPI inflation and income rising by 3 to 4 percent while home prices are falling in many local markets. But if inflation were to really get out of hand and rise by 10 percent, then the higher associated rise in income would help home prices recover in nominal terms - though not necessarily in real inflation adjusted terms.

Improving home prices from rising CPI inflation will in general protect homeowners' housing equity, and interestingly inflation can help reduce the mortgage burden. Fixed-rate mortgages are most prevalent in the marketplace. That means, the vast number of homeowners have fixed mortgage monthly payments. Higher income with fixed mortgage payments is a winning combination for homeowners.

Consider a typical U.S. homeowner in 1970 - when inflation was just picking up. She would have purchased a typical home for $23,000 (this is not a misprint). By 1980, the typical home price reached $62,200. Family income grew from $9,800 (also not a misprint) in 1970 to $21,000 by 1980.

So, while home prices and income grew, the monthly mortgage payment would have been fixed at $160 per month (assuming $23,000 mortgage at 7.5 percent interest rate). While the homeowner was undoubtedly angry about rising food , energy , and other prices back in the 1970s, she was not complaining about the mortgage payment.

Homebuyers Lose

As the homeowner was paying relatively low mortgage payments, banks and lenders must have been maddeningly frustrated. But what could the lenders do? Contracts are contracts and both parties agreed to the mortgage terms.

Not to be burned again, the lenders will rightly want to compensate for inflation before lending again. Mortgage rates - no surprise here - rose and rose. The average 30-year fixed mortgage rate rose from 7 percent in 1970 to 14 percent by 1980. It increased further, hitting a peak at 18.5 percent in October 1981. At such a rate, it would have taken 18 years to lower the principal balance by just 10 percent.

At such high interest rates, who would want to buy a home? Home sales, not surprisingly, fell big time. Home sales activity was essentially cut in half.

Lessons

Yes, the current inflation rate is uncomfortable. But actually it is not very high. CPI has been rising at better than 4 percent over the past 12 months. That is well above the Fed's comfort zone of about 2.0 to 2.5 percent preferred inflation rate. The current economic weakness will likely help moderate inflation going forward. But the weak dollar, high commodity prices, and elevated gold prices all signal inflationary concerns. Once out of the box, inflation is hard to put back other than by sharply raising interest rates purposely. That could cause a true economic recession, as happened in the early 1980s.

Fortunately, that is unlikely to occur. The Federal Reserve has already cut the Fed funds rate deeply. The 30-year mortgage rates have barely budged, however, given the lenders' concern over inflation. It is also quite possible for mortgage rates to rise even if the Fed cuts its Fed fund rate further and the lenders want to compensate for inflationary risk.

But I believe there are plenty of monetary stimuli already in the system to forestall any major concerns. As I have suggested before, what is really needed to lift the housing market is fiscal stimulus. The temporary homebuyer tax credit being debated in the House of Representative to purchase any homes (and not just foreclosed homes as is in the Senate proposal) is the appropriate medicine at this time - not only to the housing market, but for the broader economy. A housing recovery will help spur a true economic recovery. That will certainly help wash away any bad taste from our current inflation levels.

Expecting a Lift

by Lawrence Yun, NAR Chief Economist

NAR's latest pending home sales index slipped yet again. The index in March again came in soft, falling one percent from the prior month. Of course, what you'll hear in much of the media reports will be that March's index was the lowest reading since the index was created in 2001. However, smarter observers will note that for all intents and purposes, the index has actually been moving in a very narrow range from August of last year to March of this year. It's important to remember that this time period reflects post credit crunch conditions where subprime loan originations virtually disappeared from the market place.

But the pending sales index report did have some bright spots. The Northeast region continues to show some good signs of recovery. In March, pending home sales in the region rose 12.5 percent. The West and South regions were essentially unchanged. Only the Midwest region experienced a meaningful decline with a 10.4 percent fall. As with all things "real estate," some local markets fared better than others. Pending sales rose in localities where affordability conditions have measurably improved. For example, Bakersfield and Providence both showed outright year-over-year gains in March.

As for actual closings, existing-home sales finished the first quarter of this year with a 4.95 million annualized unit sales pace. That is essentially unchanged from the 5.00 million existing-home sales in the fourth quarter of last year. Home sales will continue to trend soft in the current quarter with the expectation of 5.01 million sales. In the second half of this year, look for a measurable lift to the 5.6 to 5.9 million unit range.

There are several reasons to expect the lift. Mortgages will become more widely available. Both Fannie Mae and Freddie Mac recently announced plans to further provide liquidity, including in the new higher conforming jumbo markets. California, where jumbo loans had accounted for close to half of sales in 2005, was witnessing only 10 to 15 percent of jumbo loan originations in early 2008. Any reversal in the share of the jumbo loan market will have a huge impact in markets like those in California.

Legislation is also being debated to make the higher conforming loan limit (now at $729,750 versus $417,000 a year ago) permanent rather than temporary as it is currently. The temporary status of the higher loan limit has not yet drawn investor interest in holding on to GSE backed jumbo loans, even though the spread between jumbo and regular conforming loans has narrowed.

Another key reason for a solid recovery is due to wider use of FHA loans. Many lenders are trying to get HUD approval so they can make loans. Consumers are digesting the benefits of this safer loan product that carries much lower interest rates. As consumers realize that FHA loans no longer carry the stigma as being purely for low-and-moderate income households with credit blemishes, more and more consumers will utilized the loans, thereby steadily replacing the disappearance of the subprime loans.

And let's not forget those tax rebates. Tax rebate checks are showing up in bank accounts. There are some who say the rebate is not enough to make an impact on the economy. But rebates did make a difference in 2001. And today's rebate checks are larger than the ones back then.
Other developments are pointing towards better times. Exports continue to ramp up solidly. Business profits are surprisingly solid - outside of homebuilders and the financial industry.

Business spending will grow as a result. These factors indicate that the economy will be better in the second half of this year after having stalled in the first half. The improving economy will also life consumer spirits, some gaining enough confidence to buy a home.

All that means that home prices will also improve in the second half of 2008 in many parts of the country. The return of jumbo loans and higher-priced home purchases will result in a higher recorded median home price. (Recent lower median prices were driven by fewer than normal transactions requiring jumbo loans.) As we know all real estate is local and there are large variations across markets. Even though the national median price will be lower in 2008, due to the weak first half and major price declines that already occurred in few markets, more than half of the country is likely to experience a price growth this year.

And there's a possibility of more good news. Legislation providing for a tax credit for homebuyers has been passed by both chambers of Congress, although the White House has hinted at a veto because it did not like the "big" housing stimulus bill. The White House has opposed several aspects of the stimulus bill, though it has not (yet) come out actually opposing the homebuyer tax credit concept if applied for any homes and not just foreclosed ones. The homebuyer tax credit will make market conditions much stronger than what we call for in the current baseline forecast.

Risks do still exist. Very high oil prices could stick around and that will hold back consumer spending growth. Inflation could notch higher, which then will result in higher mortgage rates. Despite these risks the economy and the housing market look to improve markedly in the second half of 2008. The momentum will carry forward into 2009.

-This article is from NAR's Real Estate Insights which can be found at www.realtor.org

8 Skills Every Home Owner Should Master

REALTOR® Magazine Daily Real Estate News May 20, 2008


These are skills every home owner should master to save lots of money over the years. Most can be tackled without fancy tools, although it helps to have a variable-speed power drill.

Replace a door lock.

Change furnace and air conditioning filters.

Find a stud in wall.



Learn to install wall anchors.



Hang a ceiling fan.



Drive drywall screws (to repair drywall).



Master a caulking gun.



Replace the flapper ball in the toilet.





Here are some books you can read for more information on home do-it-yourself projects:



"The Reader's Digest Complete Do-It-Yourself Manual." First published in 1973, it was last updated in 2005. A great all-around book.



"Home Depot's Home Improvement 1-2-3" (Meredith Books, 2003, $34.95). Clear, helpful visuals.



"Home & Garden Television's Complete Fix-It" (Time Life, 2000, $29.95).





Source: The News & Observer, Allen Norwood (05/17/2008)

Greenspan: Prices to Bottom Out in '09

REALTOR® Magazine Daily Real Estate News May 21, 2008

U.S. home prices are likely to bottom out by early in 2009, former Federal Reserve Chair Alan Greenspan told listeners at a Deutsche Bank economic conference in Singapore last week.

"We are having some liquidation now, it will accelerate, but it will not be until early 2009 that we will get close to having eliminated most of (the excess home inventory)," Greenspan said, according to a transcript of prepared remarks.

Greenspan also said he expects the credit crisis to end next year provided that the world economies maintain growth in the face of "a significant further decline" in U.S. home prices.

What’s next? Once home prices and credit markets stabilize, Greenspan foresees a period of inflation.

Source: Dow Jones International News (05/14/2008)

U.S. Senate Strikes Housing Rescue Deal

REALTOR® Magazine Daily Real Estate News May 20, 200

Democrats and Republicans in the Senate have ended weeks of negotiations with a plan that would allow the federal government to insure up to $300 billion in refinanced loans for struggling home owners.

The bipartisan accord, which represents the clearest sign yet that Congress is ready to pass sweeping legislation on housing, also seeks to tighten up oversight of government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, which provide funding for mortgages.

Republicans had been concerned that taxpayers would be responsible for what amounts to a bailout, but a provision calls for initial losses on defaulted loans to be covered by fees charged to the two GSEs. Even President Bush has recognized the Senate's efforts in recent days, easing off earlier veto threats.

Source: Wall Street Journal (05/20/08) Damian Paletta; James R. Hagerty

NAR's Midyear Meeting in Washington Yields Success and Pushes for Progress

Midyear Meetings Showcase REALTOR Party Influence on Capitol Hill
Nearly 10,000 Attendees Press Congress for Swift Action on Housing Legislation Amendment

REALTORS from across the nation recently converged on Washington, DC to exercise the most fundamental right granted by the Constitution: "the right of the people peaceably to assemble, and to petition the Government for a redress of grievances."

Nearly 10,000 REALTORS exercised their rights on behalf of all 1.2 million members of NAR and over 75 million homeowners. Elements of the 2008 NAR Federal Legislative Advocacy Agenda aren't grievances in the traditional definition of the word, but they are requests to address issues of critical importance for the future of our industry.

REALTORS meet with Congressional leadership

REALTORS pressed the case for additional housing stimulus measures to the Congressional leaders of both political parties by meeting with Speaker of the House Nancy Pelosi (D-Calif.) and Minority Leader John Boehner (R-Ohio). In addition, REALTORS briefed Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) on the state of real estate markets around the country and the need to act on the measures already passed by the House of Representatives.

REALTORS and Congress Working Together

Working with our REALTOR Party congressional allies, NAR successfully included a housing component into the administration's Economic Stimulus Package. These measures, including increased FHA loan limits and increased Conforming Loan Limits for Freddie Mac and Fannie Mae, have helped many American families avoid foreclosure, refinance mortgages and bring increased stability to the market. Unfortunately these increases will expire December 31, 2008 unless Congress enacts permanent increases. The primary mission of REALTORS visiting Members of Congress and Senators was to stress the importance of enacting a Housing Stimulus Package.

The three elements of the package are:

1. FHA Reform legislation that would make FHA a more flexible and widely-utilized program for borrowers and lenders alike and makes higher loan limits permanent.

2. GSE Reform legislation that preserves the housing mission of Fannie Mae, Freddie Mac and the Federal Home Loan Bank system and makes higher loan limits permanent.

3. Homebuyer Tax Credit that would be widely available for prospective homebuyers. Assure that the credit is available for any property purchased as a principal residence.

Moving legislation through Congress is a challenging task, but we have achieved significant progress on the Housing Stimulus Package and will continue to press Congress to get the legislation to the President's desk for signature into law.

Other goals NAR is working to achieve, involve improving access to affordable insurance through a reauthorization of the National Flood Insurance Program (NFIP) and Property and Casualty Insurance legislation that enhances the availability and affordability of homeowners' insurance.

As REALTORS kicked off the Midyear meetings, word came from Capitol Hill that the United States Senate had passed a bill reauthorizing the National Flood Insurance Program (NFIP) for 5 years. Once the House and Senate reconcile the differences in their versions of the bill, President Bush can sign it into law.

With more than twenty-eight percent of all REALTORS uninsured, enacting a Small Business Health Insurance Program to make insurance more widely available and more affordable remains an important priority for NAR. For the past fifteen months NAR has been leading a bipartisan effort to develop legislation that could break the deadlock that has stalled past efforts to facilitate access to health benefits for small-business owners, their employees and the self-employed.

The culmination of that effort is a bill introduced by Senate Majority Whip Dick Durbin (D-Ill.) along with Senators Olympia Snow (R-Maine), Blanche Lincoln (D-Ark.), Amy Klobuchar (D-Minn.) and Norm Coleman (R-Minn.) S.2795, The Small Business Health Act Options Program Act of 2008 (SHOP). A companion bill, H.R. 5918, has been introduced in the House of Representatives by Congressman John Barrow (D-Georgia-12). Determining the fate of major legislation, especially during an election year, is an inexact science, but this legislation is a reminder to Congress that NAR will continue to make health care a top priority.

These success stories are made possible by the commitment of REALTORS throughout the nation. We still have a lot to accomplish before the end of this Congress. We also have to stand ready to defend against potential attacks on the favorable real estate policies currently in place. All together NAR, our state and local association partners and members have a route toward continued success and the resources and resolve necessary to get there.

-The Washington Report from NAR

Barbara Goodas - Recipient of 1st President's Award

Barbara Goodas of ERA Cavanagh-Wright Real Estate, located in Oneonta, is the first REALTOR® to receive the President's Award from the Otsego-Delaware Board of REALTORS® for superior ethics, practices, and outstanding service to the buying and selling public - the essence of what a REALTOR® is all about!

Well done Barbara! Keep up the great work.

Ross told Barbara and the audience at the meeting that her ability and professionalism speaks for itself, that she is a wonderful REALTOR® and example for all of us. He also said that this award also speak very highly of her agency and brokers.

Shown in the photo with Barbara are Ross Gill - President (presenting Barbara with her award), Barbara Roberts (Vice President), Michele Stoeger (Board Executive Officer), Tom Tillapaugh (Otsego County Rep. for Board), and Chuck Iannello (Board Treasurer).

Barbara was recognized and given the award on Thursday 5/15/08 at the Board's 1st quarterly meeting in Chenango County at the Canasawacta Country Club.

Marketing Ideas That'll Get You Noticed

REALTOR® Magazine Online Daily Real Estate News May 19, 2008

Take some risks with your marketing, promote yourself everywhere, and be unique. Those were key messages from real estate trainer Terry Watson, who spoke at last week's REALTORS® Midyear Legislative Meetings about how to gain an edge in your marketplace.

“With 1.3 million real estate professionals, most of our advertising looks exactly the same,” said Watson, also a broker for his family’s real estate company in Chicago. But to get that word-of-mouth advertising that every practitioner should crave, Watson said it takes being bold and different. Watson highlighted some of the following ideas to give your marketing more impact:

1. Speak to customers’ desires. Don’t ask customers: “How did you hear about me?” Instead, you should be more interested in learning “What did you hear about me?” This will give you insight into why exactly they came to you and you’ll be able to better tailor your marketing to what is most important to your customers.

2. Go green. Being environmentally friendly is important to younger generations and it’s a popular topic of today’s media. Watson encouraged attendees to use it in their marketing and to earn their Ecobroker designation.

3. Use better words. Customers don't care much about marketing that tells them you’re in the million dollar club, how long you’ve been in the business, and other “me” types of promotion, Watson said. They care about how you can help them. So statements like “I sold 200 units this year” would have more impact if you said “I helped 200 families move into new homes.” Also, use words to your advantage. For example, when you tell customers that they will be working with your “assistant,” it makes it sound like you are passing them off to someone insignificant, Watson said. Instead, call your assistant a “specialist” or “partner.” Also, use the word “bought” in replace of “sold” and “new price” instead of “price reduced.”

4. Beef up your Web site. Include your Web site’s URL everywhere, including your voicemail, name tags at conferences, your e-mail signature, and your personal and business checks. Buy all domain names for common misspellings of your name. And give customers reason to keep coming back to your site: Have a recommended reading list of books, quotes of the day, humor section, photo gallery, and an area for testimonials from your customers, Watson recommends. Make sure your Web site has energy in its design.

5. Establish yourself as an expert. Write a book or a white paper. For example, you are trying to convince a customer who is facing foreclosure to work with you. Why would they want to? “I wrote the book on foreclosures!” Watson said. Or, if a book is too grandiose of an idea for you, write 10-15 pages on a subject for a white paper (possible topics: foreclosure, how to purchase a property, or expired listings).

6. Take advantage of NAR's free resources. The Library section of REALTOR.org offers free access to eBooks and ProQuest, which you can use to scan real estate books, magazines, and journals. Also, downloadable NAR brochures can help you be a resource to your customers in learning about mortgages and other homebuying and selling issues.

7. Get on social networking sites and blog. Be on Facebook, YouTube, Plaxo, MySpace, and LinkedIn. These social networking sites, when used for business purposes, can help promote yourself and elevate you higher on search engines, Watson said. Also, Watson encouraged practitioners to have a blog to build community on their Web site. Get inspired for blog posts by doing a search of what other real estate blogs are covering, highlight community events, or talk about common problems that you run across in your business (such as buyers continuously making lowball offers).

8. Always be marketing. “Everything is a marketing opportunity,” Watson said. The back of a business cards is often one of the most forgotten marketing spaces with most business card backs blank, Watson said. He recommended using the back of your business card to put a quote, a selling or buying tip, or motivation to visit your Web site (e.g. “To view, an article on ‘7 mistakes buyers and sellers make’ visit … ).

9. Have more fun. Be more upbeat and use humor in your marketing to get attention and make yourself memorable. “Start having more fun,” Watson told the crowd. “It tells customers you are in more control of your market, and it’ll make customers want to work with you.”

— By Melissa Dittmann Tracey for REALTOR® magazine online

NAR Forges New Policies At End of Week Long Meeting of Memebers in Washington.

On Saturday may 17, 2008 the NAR Board of Directors approved the following new policies:

*Approved new model rules for MLSs that would enable practitioners to alert one another to potential short sales and put them on notice about the sharing of any reduction in gross listing commission required by a lender. MLSs are given the authority to decide whether or not their participants have to disclose reasonably-known short sales.

*Gave MLSs discretionary authority to enable participants to offer cooperative compensation through the MLS as a percentage of the net sale price. The net sale price is the gross price minus seller concessions and new-construction buyer upgrades.

*Approved a statement of principles on immigration, saying NAR will be involved in immigration issues as needed to support stable, prosperous, thriving, and secure communities and to enhance the United States as a destination of choice for those seeking to own, transact, lease, and use real property. Among the principles, the association supports the right of foreign citizens to acquire and own real estate, supports the free flow of international capital for real estate, and opposes laws that would impede that flow. The directors voted to support a federal resolution on securing borders to prevent illegal immigration while allowing for the flow of legal immigrants to accommodate the labor needs of the economy.

*Supported an increase in H-2B worker visas to ensure an adequate supply of foreign workers in the United States, particularly in resort areas, which are highly dependent on such workers.

*Supported voluntary, market-based solutions to address pollution and degradation of the country’s waterways, while supporting private property rights; said federal water resource policy should take into account traditional state, local, and private water rights and uses.

*Updated the association’s policy on federal transportation funding, setting aside specific policies in favor of a flexible policy accounting for changes in travel patterns, shrinking petroleum supplies, and continuing technological innovation.

*Clarified that NAR policy does not prohibit REALTOR® associations from establishing service centers in other association jurisdictions, nor does it prohibit associations from offering member recruitment dues incentives.

*Supported use of the FHA insurance program to help homeowners refinance out of unaffordable mortgage products, provided safeguards are in place to protect FHA goals and minimize taxpayer risk.

*Affirmed that the association seeks affordable health insurance coverage that preserves choice but opposed a single-payer system and any requirement that employers provide coverage to employees.

*Approved a series of changes to NAR policies and processes for nominating and electing NAR officers, among them, that the association will hold a candidate forum at its annual and midyear meetings and create venues for directors to learn about the candidates. Of roughly two dozen election reform recommendations, only two were defeated by the board: One would have required that when the Nominating Committee interviews more than one candidate and any interviewed candidate who was not nominated chooses to run through the petition process, the committee then must present to the board a rationale for its decision to nominate the chosen individual; the second would have required NAR candidates’ Web sites to include a section for voluntary disclosure of campaign receipts and disbursements. Several of the approved changes require amendments to the NAR Constitution so will come before the NAR Delegate Body at its November meeting.

*Provided $332,753 to fund two legal cases. One involves the constitutionality of a municipal requirement for a property inspection at the point of sale. The other involves treatment of exclusive agency listings by an MLS, including exclusion of such listings from the MLS data feed.

NAR Advances Plan for Property Database

REALTOR® Magazine Daily Real Estate News May 19, 2008

On Saturday 4/17/08, the NATIONAL ASSOCIATION OF REALTORS® Board of Directors took a major strategic leap, authorizing the association to work with a technology company to create a broker-controlled national repository or “library” of property data that would provide members-only access to detailed information on all properties in the United States.

The repository, which NAR is calling a "digital library/archive," would be revenue neutral but could eventually be fee-based to cover operating costs.

In a report preceding the vote, NAR CEO Dale Stinton emphasized that the repository will not be a national MLS. There will be no offers of cooperation or compensation, nor any attempt to create a national online marketplace for property listings. The database also will be accessible to REALTORS® only, with no consumer-facing components.

“A number of technology companies are actively working to aggregate property data and provide such information to consumers, with the potential of creating an ‘information gap’ between content available to consumers and reliable information available to REALTORS®,” according to a whitepaper prepared by NAR’s Leadership Team to explain the scope and importance of the project. “We want to…arm our members with the most comprehensive information imaginable, literally for every property in the U.S. In that way our members will remain in the preeminent position to serve their clients with the best information available for any property,” the paper reads.

Last year, the directors gave approval for start-up funding for the project. Now, the association and its technology partner are charged with delivering a “proof of concept” working model of the property library/archive as soon as possible, using one or more pilot locations around the country.

The proposal wasn’t without detractors, who expressed concern about the cost and operation of such a database. Stinton said waiting for a business plan and budget to be presented for board approval would almost certainly doom the idea, allowing competitors to get a leg up in establishing their own database. After a brief debate, the directors overwhelmingly passed the proposal.

— By Robert Freedman and Stacey Moncrieff for REALTOR® magazine online

A Smart Niche: Buyers with Disabilities

REALTOR® Magazine Daily Real Estate News May 14, 2008

Despite the fact that Americans with disabilities have $1 trillion in annual income and $200 billion in annual buying power, according to the U.S. Department of Labor, only 7 percent own a home.

Acquiring the knowledge to serve this niche allows real estate professionals to both “do good and do good business,” David Layne of PCMS Consulting in Troy, Mich., told attendees at the NAR 2008 Midyear Legislative Meetings & Trade Expo here in the nation's capital.

Layne, who has more than 20 years experience working with special needs housing, told REALTORS® that the options for providing services to individuals and families with special needs range from locating homes that can be easily adapted for special needs to assisting local government and nonprofit housing groups in acquiring land and buildings to house special-need clients.

A variety of federal, state, and local programs almost make the economics of selling to those with disabilities a viable niche, Layne said. He cited two examples: The Federal Home Loan Banks offer those with disabilities $13,500 grants that can be used to cover down payments and closing costs.

These grants are forgiven after five years. Fannie Mae’s HomeChoice mortgage program provides pre-purchase counseling and flexible underwriting for qualified low- and moderate-income buyers with disabilities. Layne offered these marketing tips for REALTORS® who want to work with clients who have disabilities.

*Partner with local housing providers, support groups, and other groups serving the disabled and offer your help in locating homes for those with special needs.

*Assemble a local resource guide of transportation options, health care facilities, and support groups that will assist those with physical, mental, or developmental disabilities.

*Create a section of your Web site that lists accessible parks and entertainment, top medical and educational facilities, transportation services for the disabled, and support groups for the disabled and their families.

*Make your own office accessible, with entry ramps, Braille signage, and wide halls that will accommodate wheelchairs.

“Some 7 out of 10 Americans are either disabled or know someone who is, so you already have people in your sphere of influence that could benefit from this knowledge and provide a new source of business for you,” concluded Layne.

— By Mariwyn Evans for REALTOR® magazine online

Buyers Willing To Pony Up for Green

REALTOR® Magazine Online Edition Daily Real Estate News May 14, 2008

Home buyers will gladly pay a premium for granite countertops and walk-in closets. But will they dig deeper for better insulation, energy-saving appliances, and efficient heating and cooling systems?

Increasingly, the answer is yes, said the panelists at Tuesday’s Land Use, Property Rights, and Environment Forum at the 2008 REALTORS® Midyear Legislative Meetings here in the nation's capital.

“We’re on the crest of a wave that's continuing to grow,” said David Rodgers, deputy assistant secretary for energy efficiency in the U.S. Department of Energy. “The mission is to do more with less, not less with less. This is not about sacrificing or putting on a sweater. It’s about making investments that do more.”

Houses use more than 20 percent of the nation’s energy, according to government statistics, and U.S. households waste more than $300 billion every year because of inefficient energy use.

Knowledge Is Your Responsibility

Panelist Kateri Callahan, president of the nonprofit Alliance to Save Energy, said real estate professionals have an inherent responsibility to their clients to be educated on housing features that can increase energy efficiency. In addition to combating the harmful effects of climate change, she said, modifications to increase efficiency offer significant savings to home owners over time.

“Promoting energy efficiency worldwide will achieve a healthier economy,” she said. “It’s the cheapest, cleanest, quickest way to tackle our energy supply challenges and enhance energy security.”

Is a Federal Code the Answer?

Callahan’s group advocates for a federal energy code that would require home builders to maintain minimum standards for building materials and processes. “In many states we still allow people to buy inefficient, leaky houses that waste energy,’ she said.

But not everyone shares that position. Panelist Greg Miedema, president of Dakota Builders in Tucson, Ariz., said he opposes a federal mandate, a position shared by the National Association of Home Builders. But he concedes there is a need for standards. “We want voluntary standards. We believe mandates stifle creativity and build resentment.”

There was one other point on which all the panelists agreed: Real estate professionals can boost client loyalty — and their own bottom lines — by encouraging eco-friendly home improvements for buyers and sellers.

— By Wendy Cole for REALTOR® magazine online

NAR Members & Our Concerns Were Heard by Congress Last Week

WASHINGTON — It’s not enough for House and Senate lawmakers to pass legislation that will help bring health back to the housing industry; they have to fashion bills that can go the distance and get President Bush’s signature.

Thousands of REALTORS® at the 2008 NAR Midyear Legislative Meetings & Trade Expo are spreading that message this week in the halls of Congress.

The May meetings — REALTORS®' chance to trek to Capitol Hill each year and meet with their legislators — are coming this year at an opportune time.

The House last week passed sweeping foreclosure prevention legislation that includes NAR-backed reforms to FHA and the secondary mortgage market companies Fannie Mae and Freddie Mac.

The House bill also creates a tax credit for home buyers and would make permanent the FHA and conforming loan limit hikes authorized earlier this year as part of an economic stimulus package.

But the bill also includes a controversial plan to let FHA insure replacement financing for buyers after their troubled mortgage has been written down to 85 percent of the current appraised home value.

FHA Commissioner Brian Montgomery has characterized that plan as a “federalization” of the mortgage market and the White House has threatened a veto.

What About the Buyer Tax Credit?

The provision threatens to derail not only the long-sought reforms to FHA and the secondary mortgage market companies, but also holds hostage the homebuyer tax credit. If considered by itself, the tax credit would pass the House and the Senate overwhelmingly and would probably be signed by the president, said NAR tax analyst Linda Goold, speaking at a federal issues update Wednesday.

The House version of the credit, for $7,500, is for first-time buyers and could be taken for the purchase of any home as long as it’s the buyer’s primary residence. The Senate version is for $7,000 and would be for any buyer but it’s limited to foreclosed homes. NAR prefers the House version.

Update Flood Insurance Program

Also on REALTORS®' agenda: flood insurance and small-business health plans.Reauthorization of the national flood insurance program is probably the fastest-moving NAR issue in Congress.

The Senate this week passed a five-year reauthorization in a bill that also provides money for the Federal Emergency Management Agency to update flood mapping. It also forgives almost $18 billion in debt that FEMA incurred after Hurricane Katrina and other disasters. President Bush would probably sign that bill.

However, the House version would add wind damage to the program, something the Senate and the president oppose. Even so, the bill is likely to be passed in some form in the next few weeks because Congress is determined to act before the hurricane season begins in June, said NAR analyst Mark Washko at the forum.

Keep Moving on Health Insurance Bill

Just out of the starting gate is a new attempt at small business health insurance legislation, and the early signs are encouraging. Drafted over the last 15 months with close help from NAR, the Small Business Health Options Program (S. 2795), was designed specifically to address concerns that derailed NAR-backed health insurance legislation two years ago.

Like the previous legislation, the bill would encourage states to reform state purchasing pools and would give a role to associations to help members band together to shop for affordable coverage.

But in a change, it wouldn’t prescribe the minimum benefits that plans must cover, and it would be overseen by state regulators, though with some federal involvement through the U.S. Department of Health and Human Services.

Key interest groups representing small businesses, insurance commissioners, and some insurance providers have either come on board or had positive words for the bill, signaling that it could be effective at getting the health insurance ball rolling again.

A House companion bill, H.R. 5918, was introduced shortly after the Senate bill. “We have a tall order ahead of us,” NAR Chief Lobbyist Jerry Giovaniello, said candidly at the forum.

But thanks to NAR’s bipartisan approach to all of its issues, he added, lawmakers should welcome REALTORS®’ visits this week.

— By Robert Freedman for REALTOR® magazine online

Veto of Foreclosure Bill Not a Certainty

REALTOR® Magazine Online Edition Daily Real Estate News May 16, 2008

Veto of Foreclosure Bill Not a Certainty The House-passed bill to address the housing crisis through targeted FHA intervention and other NAR-backed provisions isn’t dead in the Senate just because President Bush has threatened to veto it.

That's the message from House Financial Services Committee Chairman Barney Frank (D-Mass.), who spoke to REALTORS® at NAR's 2008 Midyear Legislative Meetings & Trade Expo on Thursday.“It’s still an open question whether President Bush will veto the bill,” said Frank, who praised REALTORS® for their highly effective grassroots activism in working for this and other measures.

Frank’s optimism about prospects for his bill, the American Housing Rescue and Foreclosure Prevention Act (H. R. 3221), stems in part from his ongoing conversations with key Senate lawmakers and U.S. Department of Treasury Secretary Henry Paulson, he said.

The bill includes reforms to FHA as well as oversight reforms of the secondary mortgage market companies Fannie Mae and Freddie Mac. Both were provisions sought by the Bush administration. The bill also includes a $7,500 tax credit for first-time home buyers.

The administration’s main objection to the bill is a provision that would allow FHA to insure replacement financing for troubled borrowers.

The bill would encourage lenders to write down a borrower’s existing mortgage to 85 percent of the appraised value of the home in exchange for government-backed insurance on the replacement loan.

The program is expected to help an estimated 500,000 borrowers, at a cost of about $4,800 per borrower. “That’s a small price to pay to avoid all the problems associated with foreclosure,” said Frank.

The Bush administration’s approach to foreclosure prevention, which includes an initiative called FHASecure, is ineffective without any incentive for lenders to make significant write-downs on troubled mortgages, he said.

Frank said he’s willing to see the bill broken up and passed in pieces if that’s what it takes, as each individual provision is critical.

One of the key pieces would make the higher FHA and conforming loan limits passed earlier this year permanent. To let those limits, which now stand at $720,750, go back down at the end of 2008 would be “very disruptive” to the housing market, Frank said. Before their increase, the limit was fixed at $417,000.

— By Robert Freedman for REALTOR® magazine online

Home Sales, Prices Rising in Late 2008

REALTOR® Magazine Online Edition -Daily Real Estate News May 16, 2008

First, the good news: home sales have stabilized over the last seven months and should increase slightly in the second half of 2008, NAR Chief Economist Lawrence Yun told a crowd of REALTORS® at NAR’s Midyear Legislative Meetings & Trade Expo Thursday.

The other good news is that the subprime lending crisis is becoming a thing of the past. “I believe 2008 will be the year when we have to clean up and recover from the subprime mess,” said Yun.

The bad news is that the numbers are in, and 2007’s annual sales volume of about 5.30 million homes was the lowest in 10 years. Luckily, the economy is stronger overall than it was a decade ago. “The difference is that we have 25 million more people and 13 million more jobs than we did 10 years ago,” he said.

And while sales should begin to grow later this year, real improvement in the housing market won’t happen until 2009, when sales should climb to 5.71 million units, Yun said.

Price Gains to Vary by Market

Prices also are expected to begin a turnaround later this year, although recovery will vary by market. Middle-America cities that performed evenly over the past few years – like Cincinnati, Milwaukee and the Kansas City, Mo., area – are likely to experience home price gains in the 20 to 30 percent range over the next five years, while markets like Miami, Las Vegas and Phoenix could see prices go up as much as 50 percent during that time period, Yun said.

Healthier Mortgage Market Makes a Difference

A brighter credit picture is a major contributor to this improvement, Yun said. If you look at where home prices fell the most, it’s the markets were subprime loans were prevalent,” Yun said. Cape Coral, Fla.; Detroit; Las Vegas; Miami; Orlando, Fla.; Phoenix and Riverside, Calif. were among the cities with a high percentage of subprime lending and where the markets suffered the biggest downturns, he explained.

These markets should get a boost from a more stable mortgage market. FHA lending doubled to 6 percent of all loans 2007 and should grow to 10 percent in 2008. It should reach near-historic norms of 15 percent in 2009, said Yun.

The increase will be slow because many lenders will have to be certified by the U.S. Department of Housing and Urban Development before they can issue FHA mortgages. Higher conforming loan limits at Fannie Mae and Freddie Mac have also helped lower interest rates and unlock the lending log jam for jumbo loans. Even current borrowers with adjustable mortgages are in better shape, thanks to Fed rate cuts. In fact, some adjustable loan borrowers may actually see their resets produce lower payments.

“The Fed has done its job on resets; now it’s up to Congress to encourage the home buying that will help stabilize prices,” Yun said.

Other Reasons to Be Optimistic

The home buyer tax credit currently being considered by Congress would also encourage uncertain buyers to act. Stabilized prices will not only encourage sales but could help reduce defaults, he added. The foreclosures aren’t all in the past, warned Yun, though he believes that many investors and speculators already have exited the market. He expects foreclosures to rise throughout 2008 and perhaps into 2009, primarily among subprime borrowers, where foreclosure rates were near 20 percent in the third quarter of 2007.

Still, Yun notes, it’s important to remember that only 9 percent of home owners have subprime loans. Foreclosure rates for all loan types are much lower — currently, around 2 percent.

— By Mariwyn Evans for REALTOR® magazine online

NYSAR President Page Calls for Increase in Conforming Loan Limit

NYSAR joined with a coalition of REALTOR associations from across the nation to call upon Congress today to assist the recovery of the housing market by permanently increasing the conforming loan limit to $729,750.

NYSAR President Linda J. Page wrote today to the members of the Senate Banking, Housing and Urban Affairs Committee urging their support of the inclusion of this language in “The Federal Housing Finance Regulatory Reform Act of 2008.” In the letter, she noted the change would not only provide a positive boost to the housing market, but also to the state's economy.


The following is the text of the letter:

Dear Senate Banking, Housing and Urban Affairs Committee:

The New York State Association of REALTORS urges your support for inclusion of language in “The Federal Housing Finance Regulatory Reform Act of 2008” that will permanently increase the conforming loan limit to $729,750. Congress currently has a unique opportunity to give an immediate boost to the economy, bring greater liquidity to a distressed housing market, create new homeownership opportunities, and save hundreds of thousands of homeowners from foreclosure without any additional costs to taxpayers.

With steep declines in housing sales, production, and prices, New York’s slumping real estate sector has staggered the state’s economy. New York’s REALTORS believe increasing the conforming loan limit will supply an immediate infusion of capital into both the housing market and the economy as a whole. The National Association of REALTORS estimates that by increasing the conforming loan limit Congress can generate nearly $42 billion in economic activity through increased home prices alone.

A primary reason for the current decline is New York’s housing affordability crisis that has been exacerbated by the shortage of liquidity in the secondary market for jumbo loans. The shortage of capital for jumbo loans means that New York homeowners who were dragged down by the current market conditions are faced with no safe and affordable refinancing options due to New York’s high-housing costs. A significant number of New York homeowners and homebuyers lack access to not only Fannie Mae or Freddie Mac (GSE) financing, but FHA loans or the VA loan program, both of which must be increased by Congress.

Now, more than ever, Congress can no longer wait to take action. New York’s economy, homeowners and housing market need relief now and the state’s economy, like the nation’s, needs a boost. We strongly urge that the Senate include language in “The Federal Housing Finance Regulatory Reform Act of 2008” that includes an increase in the conforming loan limit to $729,750.

Sincerely,

Linda J. Page
2008 NYSAR President

State News

Lawmakers consider options to address mortgage crisis

As foreclosures continue to rise throughout the state, lawmakers are taking a hard look at how they might provide solutions to the mortgage crisis. The Assembly passed legislation to impose a one-year moratorium on foreclosures. The Senate, however, does not back the Assembly plan and may offer more support to Gov. David Paterson’s program bill (A.10817/S.8143). The governor’s bill would require lenders to send notice to borrowers 60 days before beginning foreclosure, mandate lender and homeowner meet to attempt a settlement, establish a “reasonable ability to repay” standard for home loans, require registration of mortgage loan services and would strengthen the state’s anti-predatory lending law. The bill was the subject of a Senate Banking Committee hearing this past week where it received mostly positive reviews. The Banking and Mortgage Broker industries however oppose the measure and warned lawmakers to be aware of unintended consequences of the governor’s plan including the potential of banks becoming wary of lending in New York and extending the foreclosure process in New York, already the nation’s longest.

State Property Tax Commission to put forth recommendations

The seven-member State Commission on Property Taxes is expected to release its final report by next Thursday recommending ways to alleviate the state’s crushing property tax burden. Expected recommendations include capping school district property taxes increases at a rate of growth between 3 and 4 percentage points, and giving voters the power to override a ceiling. In addition, the commission is expected to recommend that state lawmakers distribute tax relief in the form of a “circuit breaker,” which would provide grants to homeowners when their taxes consume a certain percentage of their income. The report is certain to face resistance from lawmakers and powerful unions including the NYS United Teachers who stand opposed to a tax

Federal News

Cuomo successfully puts forth contentious appraiser code of conduct plan

In an effort to end inflated home values, New York State Attorney General Andrew Cuomo has successfully pushed a sweeping “home valuation code of conduct” that will apply nationally. The code, scheduled to go into effect January 1, forbids mortgage brokers from selecting or paying appraisers; prevents lenders from using appraisers they employ; and prohibits lenders from using appraisal management companies they own or control. Cuomo’s measure applies only to loans funded by Fannie Mae and Freddie Mac, which now account for about 80 percent of new mortgages according to an Associated Press report. The American Bankers and Mortgage Bankers associations oppose the plan. Some appraisers fear prohibiting mortgage brokers from hiring appraisers will lead lenders to route all appraisals through large firms to the detriment of smaller businesses. NAR has expressed concerns with the implementation of the newly created code of conduct and submitted comments to the regulator of Fannie Mae and Freddie Mac, the Office of

Federal Housing Enterprise Oversight (OFHEO).

Senate approves measure to extend national flood insuranceThe U.S. Senate passed legislation to extend the National Flood Insurance Program (NFIP) until 2013 and forgive its $17.5 billion debt from the 2005 hurricane season. The Flood Insurance and Modernization Act of 2008 establishes a commission to examine how to best manage catastrophic risks and an ombudsman within the Federal Emergency Management Agency to ensure the 93 participation insurers in the flood program pay for wind claims. The House bill however includes wind coverage for NFIP participants as an add-on. House and Senate leaders must reach a consensus or the NFIP will expire on September 30.