The majority of U.S. cities experienced an upswing in the median price of single-family homes sold during the three months that ended Sept. 30th. This is the second consecutive quarter of gains. Nation wide the median home price went up $7,000 from the previous quarter.
The number of homes on the market has started to decrease indicating that we are closer to price stabilization. The concern is maintaining a steady number of buyers who are employed and therefore qualified to buy a home.
Much of the recent increase in home prices has been attributed to the government's first-time homebuyer tax credit. Which is probably why an extension and expansion to that credit was approved recently.
The $8,000 tax credit to first time buyers was scheduled to expire on Dec. 1st. Now, not only will it be in effect through the end of June, but those who have owned and occupied a residence for the last five years (out of eight) can trade up and get a $6,500 tax credit. Homebuyers must sign a contract before April 30 and close by June 30. The income limits were also raised: Single buyers can now earn up to $125,000 and still get the full credit while a married couple can earn $225,000.
This could be as helpful, or maybe even more helpful then the previous version because so many more people will qualify.
The Tony and Libby Kelly Group | Keller Williams Portland Premiere | 503-753-7300
1932 NW 143rd Ave #73, Portland, OR
2BR/1BA Condo
offered at $137,000
Year Built
1992
Sq Footage
814
Bedrooms
2
Bathrooms
1 full, 0 partial
Floors
1
Parking
Unspecified
Lot Size
Unspecified
HOA/Maint
$232 per month
DESCRIPTION
Adorable NW Portland Condo! This light and bright, mainfloor, condo features an open kitchen with elegant tile counters & backsplash, updated stainless steel appliances, and opens to family room. Spacious family room includes crown moldings and slider to private/fenced backyard. Bathroom features lovely tile counters/backsplash and modern double square sinks.
As we all know by now, the current state of the economy was created by mortgage lenders who were giving out money to people who did not previously qualify.
In the aftermath, many are now taking these banks to court for unfair and predatory practices. Banks have been going through these lawsuits for years but recently the number has jumped. Some have already settled out of court for millions of dollars. Banks like Wells Fargo and Countrywide have been sued by homeowners in an effort to keep their homes.
Some are seeking money for damages because they've already lost their house or paid off their mortgage. Others are looking for a loan modification, they just want their mortgage to be affordable.
Many have joined in on class action lawsuits because they do not agree with practices like high interest rates, misleading introductory rates and lack of income verification. These practices are called predatory because these loans are pretty much unaffordable, and given to people who do not understand what they are signing.
An example of these unaffordable loans is the originated payment option adjustable-rate mortgage. This type of loan allows borrowers to make very low monthly payments, and the unpaid interest is then added to the principal.
Even the NAACP is suing claiming discrimination against minority borrowers.
The largest predatory lending settlement was with Bank of America. They agreed to spend $8.4 billion to lower the interest rates or loan balances of nearly 400,000 Countrywide customers with subprime loans or payment option ARMs. This made the number one mortgage lender in the country accountable for putting borrowers in loans they didn't understand, couldn't afford and could not get out of.
The Tony and Libby Kelly Group | Keller Williams Portland Premiere | 503-753-7300
19839 NE Flanders St, Portland, OR
Absolutely charming Portland One Level! This lovely, move-in ready home features cul-de-sac location, hardwood floors, spacious living room/family roo
3BR/1.5BA Single Family House
offered at $179,500
Year Built
1962
Sq Footage
1,169
Bedrooms
3
Bathrooms
1 full, 1 partial
Floors
1
Parking
Unspecified
Lot Size
8,850 sqft
HOA/Maint
$0 per month
DESCRIPTION
Absolutely charming Portland One Level! This lovely, move-in ready home features cul-de-sac location, hardwood floors, spacious living room/family room w/ fireplace, newer windows, newer hot water heater, & updated plumbing system. Fantastic, extra large backyard w/huge covered patio & spacious shed. Great for first time home buyers! Not a short sale, just short sale pricing!
Was anyone besides me wondering what in the world they've been building behind the Bridgeport Whole Foods? Well the Tigard Times tells me that it is a new hotel. Someone didn't get the news about the economy. But sometimes a down economy is the perfect time to act.
A family-run Salem company called VIPS Industries opened up the Grand Hotel in August. They used to own a restaurant on this same spot but it did not work out. Then Bridgeport Village moved in and an opportunity arose. VIPS Industries always knew this location would be great, that is why they held on to it.
The new hotel has 124 rooms and suites, complimentary breakfast, meeting rooms, a pool and its own parking garage.
We all know the saying Location! Location! Location! but how big of an impact does it really have on home value. How much would your house be worth if you picked it up and moved it across the country?
An index that come out on Wednesday compared similar homes in "move-up buyer" neighborhoods. It compares the prices charged for 2,200-square-foot, four-bedroom, two-and-one-half bath, single-family homes in more than 300 markets around the nation.
$363,401 is the average for the U.S. but in Grayling, Michigan it sells for just $112,675. That makes Grayling the most affordable market in the nation.
La Jolla, California is on the other end of the spectrum. A comparable house there will run you $2.125 million. What does La Jolla have that Grayling doesn't? Weather for one. They don't have rush hour traffic and they are 15 minutes from downtown San Diego.
Grayling has much to love, like all the outdoor activities in and around the Au Sable River, but Michigan has a much slower economy.
Variations are not only between states but within states. California holds 8 of the top 10 highest priced markets, but there are some affordable towns here too. Just north of L.A. is Lancaster where the sample home would go for $165,205 which is almost $2 million less than in La Jolla, California.
Some states have much less variation. Oklahoma's price spread is less than $10,000. In Boise, Idaho homes cost $215,432 compared with $204,518 in Coeur d'Alene
Buyers know that the home buyer's tax credit deadline is approaching. It is obvious by looking at the sales contracts signed in August. There were more contracts signed in August than any other month this year. This has caused 7 consecutive months of increases in pending sales, which is a great sign.
The homes that went "under contract" in August should be closing in October or November, just before the Nov. 30 deadline for the $8,000 first time home buyer's tax credit.
Some may be trying to take advantage of this deal even now but many will be disappointed when the closing deadline isn't met. Stricter appraisal standards, delays getting a mortgage and complications associated with short sales are going to keep some from their $8,000.
In fact, some deals are not going through at all possibly causing a pending sale to be counted twice when a home has to be put back on the market and sold again. This could be inflating the numbers.
We may see a sharp decline in home sales once the credit expires so extending it could avoid another disastrous down slide. The government is thinking about whether to extend and expand the tax credit. Expanding it to all home buyers could really rev-up the market!
Pending home sales haven't looked this good in two years and actual closed sales are looking good too. The stock market is coming back and the countries exports are rising faster than our imports.
Things can still trip up our recovery. The inventory is finally ready to go down but some home owners and banks with foreclosures may have been waiting for things to turn around to put their homes on the market. There is also the possibility that the deficit could mean higher mortgage rates. Not to mention job losses are not over and will keep the foreclosures coming.
There is still reason to be positive with inventories currently going down and prices stabilizing, it might just be the turn around we are all waiting for. Then, the jobs will come back.
Q.Recently I have had a couple sale agreements come across my desk for bank properties. In both cases none of the contracts were signed and the deals were sent to escrow with only buyer’s signatures. What is the proper procedure with files like this when an asset manager refuses or is not willing to sign any documents yet replies with a counter offer and their terms but no signatures?
A.Banks and their asset managers often have no interest in complying with real estate licensing rules or even normal residential real estate practices. Such rules and practices don't apply to buyers and sellers personally because they are not licensed. Binding contracts for sale signed by both parties are a great way to get to a deed, but there is nothing in the law that requires people to have binding contracts if they don't for some reason want one. Real estate licensees have a duty to advise their clients about the potential business (not legal) consequences of the deals they (the principals) enter into and keep copies of the actual documents the parties use in those transactions. Most REOs require the buyer to sign the REO's forms when the buyer makes an offer. Because the REO forms come after the buyer's offer, they are often thought of as (and sometimes even called) "counter offers." They often are not really “counter offers” because they are not signed by the seller. It's more like getting a buyer to sign a purchase order where the buyer agrees to purchase if and when the seller actually agrees to sell. That isn't illegal. Nor does it prevent opening escrow. It just puts the seller in the driver's seat all the way to closing. Buyers need to understand that without the seller's signature, it may be hard to enforce the contract. In this regard, a follow-up email or letter to the seller through the listing agent saying "we understand we have a transaction and will rely on the terms of that transaction to make expenditures and forego other purchase opportunities" will help clarify the buyer's position. You will want to log onto the Oregon Association's webpage at www.OregonRealtors.org and visit the Risk Management Toolkit to look at the new section entitled: "Dealing with REOs.”
In this forum we will offer discussions on a wide variety of subjects, but focus on Portland Metro and real estate. Hopefully our insights and experiences will inform, educate, challenge and entertain our readers week after week.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
As we all know by now, the current state of the economy was created by mortgage lenders who were giving out money to people who did not previously qualify. 
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