Real Estate News (Week of 5/12/13-5/18/13)

Mortgage and Lending with Fitzgerald Financial, a Division of Monarch Bank

From the Desk of Bob Caldwell

Real Estate Report 5/15/13

     Is a home the new engagement ring? A new national survey shows more and more young couples are putting home loans before wedding bands these days. The new Coldwell Banker survey shows nearly a quarter of married couples between the ages of 18 and 34 purchased a home before getting married. Matt Williamson and Olivia Wee of Minneapolis are in that boat, having closed on their first home a few weeks ago, even though their wedding isn’t until August. Psychologists say shopping for homes forces young couples to tackle issues they should deal with before getting married, such as how to cope with major disappointments. In a phone interview, Dr. Robi Ludwig, a psychotherapist and Coldwell Banker’s official “lifestyle correspondent,” said that buying a home together has become “the new engagement ring” for some young couples. They’re committing to purchasing real estate as a couple regardless of whether they’ve set a wedding date. Some even forego lavish weddings and honeymoons in order to cover the down payment and a chunk of the mortgage. “Millennials have a very pragmatic state of mind,” said Ludwig. “They know that they have an opportunity here, with low rates and low housing prices. And they think, ‘We’re moving toward marriage anyway, so let’s buy.’ It makes sense.” The survey shows most couples who purchase a home before getting married end up moving in together. Sources: CBS Minnesota and Time

     During the peak of the housing crisis, foreclosed homes sold at a 25% discount on average, but the market is stabilizing and the price differentiation between a home’s foreclosed valued and original market value is beginning to narrow, FNC reported. The real estate analytics firm released a Foreclosure Market Report recently, saying home prices are rising in many metro areas while foreclosure prices are starting to bottom out, creating some price stability. "The fact that we are seeing a combination of rising home prices and a bottoming out of foreclosure prices is a very good sign the housing recovery is taking hold," said Dr. Yangling Mayer, FNC Senior Research Economist. "This is the very first time in the long housing recession that the two are happening at the same time." By the fourth quarter of 2012, the average foreclosure discount, which is a comparison between a foreclosed home's market value and its final sales price, had dropped to 12.2%, compared to 25% during the peak of the downturn. Single-family REO and foreclosure sales made up 18.1% of the market in the fourth quarter of 2012, down from 26.5% in the first quarter of the same year, FNC said. Source: HousingWire

     Home sellers are more than twice as likely to get their homes sold if they use a Realtor®, rather than trying to sell their home on their own, according to a new survey conducted by HomeGain of 400 home owners nationwide from July 31 to Aug. 10. Seventy-three percent of the home owners surveyed said they used a Realtor®. On the other hand, 21 percent of those surveyed said they tried to sell their home themselves. The survey found that 66 percent of the home owners who used a Realtor® were able to successfully sell their home compared to 30 percent of for-sale-by-owners. What’s more, the survey found that 22 percent of the for-sale-by-owners eventually decided to use a Realtor® to try to sell their home. More than half of those who did were then able to sell their homes too, the survey found. “The value of a Realtor® in a real estate transaction is made strikingly apparent in our 2012 FSBO verses Realtor ® survey of home sellers,” says Louis Cammarosano, general manager of HomeGain. “A qualified Realtor® understands the dynamics of the market and can better assist home sellers in the pricing and preparation of their homes for sale.” Source: HomeGain

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