Home Prices Rise Overall but Some Areas Decline…

Home Prices Rise Overall, but Some Areas Seeing Sharp Declines

Home prices rose again nationally in September Lender Processing Services (LPS) said today, but in many areas, notably a lot of the older mill towns in the Northeast, prices are still declining, in some cases sharply.  LPS's Home Price Index (HPI) was up 0.2 percent from August to $232,000 and has risen 8.2 percent since the beginning of the year and 9.0 percent since September 2012. 

Nationally the HPI has climbed back to within 14.1 percent of the peak level reached in June of 2006 when the index was at $270,000.  In many states however, such as Florida (-35.1 percent) and even, despite its recent unprecedented gains, California (-25.3 percent) prices have far from fully recovered.  

LPS derives its data from residential real estate transactions and its own property and loan-level data bases.  The HPI is the result of a repeat sales analysis representing the price of non-distressed properties by taking into account price discounts for bank-owned real estate and short sales.

Five states had increases in their HPI of half a percent or more from August to September, Nevada was up 0.8 percent, Georgia and South Carolina increased by 0.7 percent and both Florida and Illinois were up 0.5 percent.  The largest month-over-month declines were in Connecticut (-0.9 percent), New Hampshire (-0.6 percent), Massachusetts (-0.5 percent) and Colorado and Pennsylvania each of which declined 0.4 percent. 

Colorado along with Texas established new peak prices in July but while Texas has gone on to even higher HPI levels and established another peak in September, Colorado has declined every month since.  The state is now down 0.7 percent from its recent peak.

The biggest price gains among metropolitan areas were almost all in the south.  Myrtle Beach, South Carolina gained 1 percentage point in September followed by Charleston South Carolina, Atlanta, and Miami with 9 percent increases.  There were five metro areas that were up 0.8 percent, Naples, Florida, Reno and Las Vegas, Ocean Pines, Maryland; and Key West. Austin, Texas gained 0.6 percent and established a new peak price at $241,000.

The big losers were mostly in New England.  Torrington (-1.0 percent), Bridgeport (-0.9 percent), and Norwich (-0.9 percent), Connecticut were followed by Springfield, Massachusetts and New Haven, down 0.8 percent.  York, Pennsylvania and Kennewick, Washington, down 0.7 percent.   Worcester, Massachusetts and Manchester, New Hampshire each lost 0.6 percent in value from September.  Denver, which had, along with Colorado, set a new peak in July is now off that peak by 0.8 percent after falling half a point in September.

 

Are you ready to buy a home…

Are You Ready to Buy a Home?

BuyFinance 

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Nov 4, 2013 

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While it may be acceptable to snap up a pair of shoes on an impulse, buying a home requires thoughtful planning and decision making. Whether you’re becoming a homeowner for the first time or you’re a repeat buyer, buying a home is a financial and emotional decision that requires the experience and support of a team of reliable professionals including a Realtor, a lender, a lawyer and a range of other individuals.

Why Do You Want to Buy?

The emotional part of the decision comes into play when you think about why you want to move. If you’re a first-time buyer, you need stability in your career and the desire to commit to living in the same community for five to seven years. You should want to establish roots in a neighborhood and look forward to decorating as you please without requiring a landlord’s permission.

Purchasing a home is a lifestyle choice that requires you to think about how you like to spend your time and the type of community where you want to live, such as a rural area without nearby neighbors, a highrise building in a city or a home within a planned community with recreational amenities. The more you understand your priorities for a home, the easier it will be for you to narrow your real estate decisions.

Homeownership can also be a powerful way to increase your personal wealth for you and your family, since you’ll be building equity in your home as you pay off your mortgage.

Are Your Finances Ready for Homeownership?

While your dream home may or may not be within your reach right away, you can take steps to become a homeowner the moment you earn your first paycheck. In order to qualify for a mortgage loan to buy a home, you’ll need good credit, a pattern of paying your bills on time and saving money, and a maximum debt-to-income ratio (your gross monthly income compared to the minimum payments on all recurring debts) of 43 percent. Some lenders have stricter guidelines, so the lower your debt-to-income ratio, the better your chances of a loan approval.

While loan programs are available with low down payments of 3.5 to 5 percent, and a few programs offer no down payment at all, you’ll still need some savings to pay for closing costs and moving expenses, a deposit on a home, and for cash reserves after you buy. Saving money and preserving or improving your credit history are essential elements to homeownership.

What Can You Afford to Buy?

Housing prices and rents vary from one location to another, but you can use a rent-vs.-buy calculator to estimate the difference between your current rent and buying a home. In some markets buying a home can cost the same or even less than renting. Remember, when you’re a homeowner you need to included homeowners insurance, property taxes and homeowner association dues in your housing costs. You can also use a home affordability calculator to help you estimate what you can pay for a home. You should also think about your plans for the future and how you spend your money, along with your comfort level with a mortgage payment. A lender will tell you how much you can borrow, but that lender won’t know how much you spend on travel or golf or your plans for potentially reducing your work hours when you have a family.

Once you’ve thought through the emotional and financial aspects of becoming a homeowner, your next steps should be to find a reliable, experienced Realtor to become your partner in the homebuying process and to meet with a reputable lender who can discuss your options for financing your purchase.

 

Facebook & Yahoo CEO’s buying up Palo Alto…

Facebook and Yahoo CEOs buying up Palo Alto real estate in bulk

 
With the incredible salaries paid to folks high up in tech firms, owning not just one house, but all those in near periphery isn’t an issue. Witness the duplicate-homes-on-one-block buying spree of both Facebook founder Mark Zuckerberg and Yahoo! CEO Marissa Mayer.

Zuckerberg quadruples his real estate

The face of Facebook, Mark Zuckerberg recently bought the three homes adjacent to his main residence in Palo Alto– a move Trulia reports was meant “to protect his privacy and to stop a developer from marketing a home as being ‘next door to Mark Zuckerberg.’” To create this private compound in one of America’s priciest areas, Zuckerberg dropped $30 million, now owning four homes in close proximity (when we include his original $7 million estate).

Mayer buys a funeral home

Zuckerberg tends to set trends in the tech community and this “buy the block” concept may be another such trend. According to reports by The Silicon Valley Business Journal and Palo Alto Weekly,  Yahoo! CEO Marissa Mayer Mayer just bought the large lot upon which Roller & Hapgood & Tinney have operated their business for decades. To the uninitiated, that location housed  Palo Alto‘s oldest funeral home. The funeral home closed for business on Oct. 31; and now, for $11.2 million, Mayer is the new owner. We can’t say for sure what Mayer plans for the location, but she’s unlikely to re-open the facility for funerals. Her own home, incidentally, is “just a short block from her new purchase,” reports Trulia Luxe.

Did she buy it to put the kibosh on future development near her home or is she making a savvy investment?  A 2012 Palo Alto city planning document identified the funeral-home property as “a potential site for up to 21 residences.”

Either way, the footprint of Silicon Valley is getting bigger in Palo Alto’s residential real estate– daily.