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Home Prices - Will they rise?

By
Real Estate Agent with The Homefinding Center

I was checking out Real Estate News for today and happened upon the article below. 

I think that Sellers always think their home is worth more than Fair Market Value and Buyers always think homes are over priced - Sellers have heart strings, and Buyers are looking for the best deal - it's not just in this crazy market, but EVERY market. 

Personally, I think the $8,000 incentive is boosting home sales.  Think about it rationally.  Renting - one is throwing hard earned money away.  Owning - it's yours, you get tax write-offs on interest and free-reign to paint your house neon pink if your heart so desires, and from now until April 30th (COE on or before June 30) you will receive $8,000 back, and for most 1st time home buyers, this is MORE than what they spent out of pocket.  It's almost like buying something for free - like a cool new cell phone with a full price rebate, but with bedrooms, bathrooms and home inspections. 

Below is the link to the 'mortgage' calculator this article discusses toward the end - really, it's like the opposite of a mortgage calculator.  Check it out and contact me if this 'Magic 8 Ball' says you should sell! 

http://www.payorgo.com/

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According to a recent fourth quarter survey by HomeGain.com, 72 percent of Realtors believe that home prices will either stay the same (48 percent) or increase (24 percent) in the next six months. Despite that news, the study found that an increasing number of homeowners (41 percent) think that their homes should be listed 10 to 20 percent higher than what is being recommended by Realtors. In the third quarter of this year that figure was down to 38 percent and in the second quarter it was at 36 percent.

But the flip side of the coin shows that 62 percent of buyers think homes are still overpriced. According to the survey, that figure is slightly down from 64 percent in the third quarter but up from first quarter statistics (59 percent).

The national study surveys 1,000 current and former HomeGain Realtor members and was conducted between December 1 to 6. According to the study, 21 percent of those surveyed say that half of their transactions involved a first-time homebuyer. The extension of the tax incentives for buying homes is being credited.

In a statement issued by HomeGain's Louis Cammarosano, the company's general manager, said, "The fourth quarter HomeGain Home Prices Survey of Realtors shows that Realtors believe that the first-time homebuyers tax credit has driven sales and stabilized home prices, for now. Realtors, however, expressed concerns about the cost of the credit to taxpayers and whether sales will continue once the credit expires later next year and additional inventory hits the market." The study also asked respondents "whether they approved or disapproved of President Obama's performance so far-42 percent approved and 58 percent disapproved, unchanged from the third quarter and down from the second quarter when the President's approval rating stood at 57 percent.

Another poll, the Rasmussen Daily Presidential Approval Rating Tracking Poll, published on December 11, 2009, stated that, "Overall, 47 percent of voters say they at least somewhat approve of the President's performance. Fifty-one percent (51 percent) disapprove." Still, respondents remain optimistic about the housing industry, "The vast majority of Realtors expect prices to remain the same or increase in the first six months of 2010," said Cammarosano.

With more first-time buyers searching the market for homes, everything from short sales to foreclosures is being considered. And for sellers, estimates that as high as one in five of homeowners is underwater are causing them to take a hard look at their financial situation. Some are turning to an informational Web site called PayorGo.com. It offers a calculation service to help make the decision but doesn't offer financial or legal advice on the site. The site aims to address this question, "Is it in my economic interest to walk away? You decide.

This calculator is just a tool to help. Numerous variables are involved but the biggest is probably your assessment of the future of housing pricing." Interestingly, buyers may not be capitalizing on all of the available incentives and resources. In an article published in the San Francisco Chronicle in early December, Walter Zhovreboff, the administrative director of the Bay Area Home Buyer Agency (that promotes homeownership) said, "Many cities have adequate funding to assist families here (with down payments) and we're not running out of money. It's phenomenally frustrating." Some cities still offer down payment assistance for low-to-moderate income levels. Many of these loans are known as "sleeper loans" which provide a period where no money is initially needed to be paid toward repayment, then a moderate interest rate is applied and the loan is paid back over many years.

Check with your agent and city for more available resources.

Posted by

Amanda Daniels
951-445-2985
amandadee.homes@gmail.com


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