Improving Real Estate Market

Market Classification Changes!



Recently, as of April 19, 2010 , the classification for the real estate market in Maryland has changed from "severely distressed/class 4" to "soft/class 2". What does this mean? While this doesn't mean that we are back to "normal", it is a move in the right direction. With the recent reclassification, banks are now able to offer some more attractive loan options for home buyers. In a class 2 market, buyers with a credit score of 700 or better will now qualify for a conventional 5% down loan! Keep in mind FHA just increased their MIP and are soon to increase their required down payment. When comparing apples to apples, cash to close on a property may be slightly higher with the conventional 5% down loan, but the overall loan amount will be lower. If you would like to know what type of homes are available or what type of loan / loan amount you qualify for, feel free to contact me. Thanks!

Another Real Estate Slump?

Well, we're on the cusp of the Home Buyer's Tax Credit Expiration, again. Last year when the 1st expiration date approached, market activity slowed and slumped for roughly 2 months. Was this just because buyer's we're throwing in the towel and giving up on the tax credit or was this due to other factors( weather, time of year...)?

This time around, interest rates are poised to rise slightly and FHA has decided now is a good time to increase the cost of buying a home (MIP increase). Will this mean another slump or will the annual spring warm-up keep us from creeping to a halt?

I think this is a time of opportunity. As a seller, you have buyers who are nervous to miss out on the potential $8,000/$6,500 credit and they are feverishly searching for a home, now is the time to strike a deal. Also, as a buyer you have a slight pyscological advantage. Sellers are worried that after April 30th, buyers will give up searching and pack in their efforts to find a home.

As with any real estate market, there are chances to capitalize. Both for buyers and sellers, now is as good a time as any in recent history. I am experiencing increased optomism in both buyers and sellers and overall activity is up over this time last year. With the ample supply of short sale listings, REO properties, foreclosed homes and traditional resale listings, buyers have more than enough to choose from and property owners are vying for your business.

Overall, this real estate market takes knowing your surroundings. Know what you are looking for and what you can look for. If you need to take possession within 45 days, then a short sale may not be your best option. If you can't make repairs, then an REO or foreclosed home may not be a smart choice. If you do find yourself open to looking for a distressed property, make sure you choose a Realtor with sufficent experience/training to walk you through the process.

If you have questions or need my help advice for your real estate questions, feel free to visit my website http://www.allhomes4me.com/ or contact me.

FHA Property Flip Waiver Renewed!!!!

Previously there has been a "waiting" period, for a buyer using an FHA insured loan, to buy a home......

"Green" Real Estate?

"Green" real estate, this is a catch phrase being throw around more and more everyday. Before I start off putting ecologically minded individuals on the defense, I want to say that I believe that we all need to weigh the costs involved in owning a home, building a new home, driving our cars and other activities that have an impact on our environment, but I think we all need to use some common sense. I can appreciate the care and consideration put into deciding to "go green", but I think we need to look at the reason we each come to the conclusion that "green" is the way to go.

The media and other information outlets has really taken hold of the ecologically friendly concept of using energy efficient appliances, recycled materials, products manufactured from renewable or long lasting synthetic elements. I think we need to look behind the reason for this. Naturally there is the very obvious point of protecting the planet we live on for future generations, but I want to pose a point of view. I think "green" is bringing in a lot of green. I've read in several places that the "green" revolution is a trillion dollar industry. I don't want to be a conspiracy theorist, but there are always ulterior motives for many, many approaches to different situations. The "green" revolution is another in a long list of counter cultural directions. Remember the whole "say no to drugs" that Nancy Reagan was spear-heading? How about the slogan locally, "Baltimore, the city that reads." which Mayor Schmoke was the originator? One soapbox that has been around for as long as I can remember is this one, "Help control the pet population, have your pet spayed or neutered." All of these statements were most definitely born out of a genuine concern to prevent something bad from happening or preventing harm to someone or something.

My only concern is that if the whole reason of going "green" is to conserve, then shouldn't all of the most ecologically friendly options be presented? In fact, I think that going "green" is actually not very green at all! Compact fluorescent light bulbs are definitely a huge energy saver, but have you looked at their prices? How about geo-thermal HVAC systems? They certainly can save a ton of expense on your heating or cooling bills, but their cost to install is triple to quadruple the cost of a conventional system. How much are you saving if you are spending double to triple the expense just to feel good about "doing your part"? Also, frequently when people decide to purchase "green" energy products, they don't change their habits at all. Actually, they feel a sense of freedom and end up using more energy. Kind of like eating twice as many reduced calorie cookies.

To me, the best way to go "green" is to buy an existing home for sale or to repair the one you have. Building a new house on land previously used to farm corn or support cattle just takes another piece of our planet and turns it into a tax producing, carbon producing lot. Wouldn't our economy be better off if the 10-18 month inventory of homes we currently see across the country, were reduced to 6 months ? New home builders would have to be more competitive with their prices and those who couldn't compete could supplement their business by remodelling or rehabbing properties. I know there are situations where this might not be feasible, but I think that as Americans we are a society that thinks dispose first, repair second.

My point of writing this is not to bash those who have a genuine concern for the environment, I honestly appreciate the time that is put into thought and actions to help keep our planet as healthy as possible. My only concern is that "green" has become the next Starbucks, Snapple, or Calvin Klein. The concept of green should extend into every aspect of your life. If this were to happen, not only would our planet be healthier, but so would our economy, our bodies and our government.

Bailing Out Corporate America!

I'm sure, by now, everyone has heard of the proposed plan to "right" our countries economic slump/recession/DEPRESSION. The President is proposing that the US government purchase the spoiled investments of some large corporations. While I think the President/congress want us to think that this is i the best interest of the tax-paying American public, I'm not sure that I agree. I recently received and email that suggested that the President give the billions to every tax paying American citizen over the age of 18. This would have figured out to be a very large sum of money to each person. The impact of this many people having this much cash would rectify the whole economic situation that we're in. While this is a novel idea, the reality is that this will never happen.

On the other hand, I myself am an independent contractor (self-employed), and right now with the real estate market the way it is, I may find myself upside down in a few financial situations. Do you think the government would listen to an email or letter sent from me asking for a freebie? I would have better luck getting my dogs to dig up gold in my back yard. The thought of rescuing a corporation from the poor decision making or their investors or multi-millionaire CEO's is ridiculous. The whole concept of our economy is the idea that companies or individuals who make poor choices or bad decisions will fall away and that will leave an opening for the next entity to fill the spot. Artificially preventing this could have long term effects that no one can predict, not to mention that there is no guarantee that the investments that the government is going to "babysit" will ever be worth what they pay for them.


The thought of all of this happening is really very depressing. There are thousands of people who are retired or close to retirement that have the bleak outlook of having their hard earned 401K plans or investments turn into nothing more than a write off. This proposed plan will do nothing for them or for you and I.


I think the whole idea should be voted on by those who will be footing the expense for this, the tax paying public. We have an election coming up in less than 45 days, this would be the best time to count our voices.

FHA & DAP Changes

I wanted to update any buyer or seller who may be thinking of making a purchase or selling a house in the very near future. Over the past several months there has been much debate over the use of non-profit organizations contributing funds to a buyer’s closing expenses. There two thoughts that are shared on the use of these programs to get buyers additional funds to make a purchase. One thought is that it is a great tool and gives those, who might not otherwise been able to buy, the chance to buy a home. The other side of the argument is that the process of having the seller contribute funds to the non-profit and then the non-profit gifting them to the buyer is merely money laundering. While I see both sides, it doesn't take away from the fact that this is a legal method of getting buyers, who qualify for a purchase but just don't have the cash needed for closing costs/down payments, the resources to buy a home. Effective Oct. 1, 2008 the several down payment assistance programs that have been used for many, many years (much more frequently in the past 18 months) will be no longer allowed.

Now, FHA loan changes. The tightening guidelines of conventional loans and the increasing down payment requirement has allowed the lower required cash to close of the FHA program to become a great alternative. Well, as of Oct. 1, 2008 FHA loans will now require a 3.5% buyer investment into the purchase of a property; the previous amount was 3%. While this doesn't sound like a huge change, you must also consider that the way a lot of buyers were getting their cash for closing costs and down payment was from the non-profit grant programs. While this is not the best news for buyers, it is also not good for sellers who are looking to sell their homes.

There is still time to make a purchase and get into a home under the existing parameters; it just has to be underwritten by the lender by Sept. 30, 2008. So, if you have been thinking of buying or you have a house to sell, give me a call and I'd be happy to help you use this window of opportunity to maximize your buying or selling power.

Another Low Offer!

It sure is getting hot these days. Summer weather is officially here. The temperature is rising daily as is seller's blood pressure. The current market sees many homes still available, but homes are selling. What gives? Well, from my experience, the homes that are selling are the properly priced homes, whether newly listed or reduced prices. The homes that were over-priced to give the seller negotiating room are sitting. These sellers are not seeing the traffic that the newly listed and competitively priced home are seeing. What's the lesson here? Listen to your realtor and price your home to be competitive with the surrounding listings. An over-priced home will not draw the attention that a competitively priced home does and will become stagnant after a few weeks. Additionally, there are more points to negotiate over than just price. Ask your Realtor what you may have that could be used or become a point of negotiations. A colleague recently had a property under contract and the buyers requested a handful of repairs well after the deadline specified in the home inspection addenda. Not wanting to lose the deal for sticking to the agreed contract, the sellers offered to leave a swingset that was currently in the rear yard. The buyers were excited when they heard this and decided to drop the requested repairs. The swingset may have had a value of $300, while the repairs would have costed $500-$700 and would have taken time and effort to have them done. Oh, by the way, the sellers never intended to take the swingset anyway! While price is a main point of interest for buyers, there are several other areas where a compromise can be made. Don't just think because someone makes an offer that is lower than your asking price that the offer is horrible. Take the time to weigh all of your options and maybe even ask the buyer's agent what the buyer's other needs are. Maybe there is something that is of value to the buyer that you wouldn't mind negotiating on.