Pinehurst, NC market update

This month we'll focus on the positives in today's Sandhills real estate market.  Currently the forecast is lining up for the "Perfect Storm" for buyers.  With newly approved federal agency loan limits, historically low interest rates, a healthy inventory of homes for sale and anticipated population growth still on the horizon, this may be the greatest time ever to consider buying a home in Moore County, especially for first time home buyers and second home purchasers.  And, let's not forget the numerous tax advantages of home ownership.

Mortgage interest deductions, including in some cases mortgage insurance premiums, reduce home owners' tax liability by reducing income.  The deduction includes interest paid on both first and second homes and may include certain closing costs as well.  Interest on home equity loans may also be deductible and, when you sell a home, as long as it's a primary residence that you have occupied in two of the last five years, any profit on the sale of the property may be tax free up to $250,000 for single family home owners and $500,000 for married home owners filing jointly.  Where else can you earn $500,000 completely tax free?

Some additional good numbers... Freddie Mac recently predicted the average 30-year fixed mortgage rate will slip to 5.5% this year from 6.3% in 2007, which would mark a 45-year low.  New FHA loan limits were recently set for Moore County whereby lenders can now lend up to $271,050 on a single family home with as little as a 3% down payment.  But wait there's more, the FHA gift program may still allow the seller to pay the 3% down payment.

I remember my first home purchase in a similar market to the one we're in now.   I traded a 1986 truck with 135,000 miles on it for $3,500 and then leased a new Toyota Camry with leather, sunroof, the works with $0 down for $249/month.  I left the dealership with a new car and a check for $3,500 then used the $3,500 to come up with a 5% down payment on a $131,500 house in a nice family neighborhood in Decatur, GA just 7 miles from downtown Atlanta.  My loan was a 1-year adjustable rate mortgage at 4.75% and 12 months into it, I had my house re-appraised to help cancel the PMI (private mortgage insurance).  Three years later I sold that first home for $235,000 and owed no income tax on the $100,000+ profit.  Within a few months I started over, this time even closer to the city with a $515,000 home and a 3-year adjustable rate of 5.25%.  I sold that house 2 ½ years later for $689,000 and a $174,000 tax free profit.

Now for the disclaimers:  A correction in last month's update, I inadvertently left off two of the active listings in Pinewild which means the highest asking price in that community is actually $1,290,000 and the current average asking price is $575,409.  I am NOT an accountant, attorney or mortgage broker or otherwise an expert in those fields.  I am also not a fortune teller or time traveler and cannot predict the future of any market with absolute certainty.  ALL investments, real estate or otherwise come with inherent risk (though it is easier to live under the roof of a house than the paper of a stock certificate.)  I AM a REALTOR® and can assist you in buying or selling a home.  You should always contact a professional in the specific areas of need or interest you may have. 

For any assistance in buying or selling a property or just to talk real estate, call Bob or Brandee Bryant of McDevitt Sotheby's International Realty at 910-585-1114 or via email at info@PinehurstNCrealty.com.