Home homebuyer april10

homebuyer april10

April, 2010 Newsletter

+++++++++++ April 1, 2010 +++++++++++++++++++

CONTENTS: 
Introduction: Declines in Existing and New Home Markets
Mortgage Rate Update: Rates Steady
This Month’s Tip: What Type of Housing is Best for You?

Introduction: Declines in Existing and New Home Markets

Welcome to the April edition of the Home Buyer’s Newsletter. Although sales declines were not quite as severe as some had predicted, both existing and new home sales rates fell in the month of February.

Existing-home sales declined slightly in February, with modest gains in the Northeast and Midwest offset by softer sales in the South and  West, according to the National Association of Realtors®.

Existing-home sales, which are finalized transactions that include single-family, town homes, condominiums and co-ops, slipped 0.6 percent nationally to a seasonally adjusted annual rate of 5.02 million units in February from 5.05 million in January, but are 7.0 percent higher  than the 4.69 million-unit pace in February 2009.

Lawrence Yun, NAR chief economist, said widespread winter storms in February may mask underlying demand. “Some closings were simply postponed by winter storms, but buyers couldn’t get out to look at homes in some areas and that should negatively impact near-term contract activity,” he said.

“Although sales have been higher than year-ago levels for eight straight months and home prices are much more stable compared to the past few years, the housing recovery is fragile at the moment.”

Total housing inventory at the end of February rose 9.5 percent to 3.59 million existing homes available for sale, which represents an 8.6-month supply at the current sales pace, up from a 7.8-month supply in January. Raw unsold inventory is 5.5 percent below a year ago.

In new construction, sales of new single-family houses in February 2010 were at a seasonally adjusted annual rate of 308,000, according to estimates released jointly on March 24th by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 2.2 percent(±15.3%) below the revised January rate of 315,000 and is 13.0 percent (±12.2%) below the February 2009 estimate of 354,000.

The median sales price of new houses sold in February 2010 was $220,500; the average sales price was $282,600. The seasonally adjusted estimate of new houses for sale at the end of February was 236,000. This represents a supply of 9.2 months at the current sales rate.

Obviously, a big factor here is the supply of inventory: 8.6 months in existing homes and 9.2 months in new homes. Until sales make progress in trimming back the amount of inventory, it may be a bit difficult to get traction toward a sustained housing recovery.

For those who are looking to purchase in the near future, however, the stars appear to be aligned in the month of April. Mortgage rates remain at near multi-decade lows, it is the last month for tax credits  for both first time and repeat purchasers and prices in many areas are off from 10-30% or more from the peaks of just a few years ago. Does this mean it is all up and away from here? No, but the positives in this market in many localities definitely edge out the negatives. Just be certain to do your research, buy with both your mind AND your heart and take advantage of the resources that are available to you.

Mortgage Rate Update: Rates Steady

Mortgage rates remained fairly steady for the month of March, good news for buyers who are committing to purchases. According to mortgage company Freddie Mac, 30-year fixed-rate mortgages stood at an average of 4.99% at the end of the month after beginning the month at an average of 4.97%. 15-year fixed-rate mortgages trended in a similar fashion, beginning the month at an average of 4.33% and ending at an average of 4.34%.

Sustained low mortgage rates and as good inventory availability in most areas as well as price pressures on sellers mean that the advantage remains with buyers in this market.

For current average mortgage rates, see the rates page.

For more information on mortgages, visit the Mortgage Section

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This Month’s Tip: What Type of Housing is Best for You?

You have made the decision that you want to buy a house. You have checked your finances and they are in order. Their is lots of availability in the area in which you are interested, so finding a home will not be a problem. Next, though, comes a big question: What type of housing best fits your needs and wants?

It is important to understand that there are huge differences in the housing types that are available to you. Although you will find that there are additional variances involved in some cases, housing falls into 3 basic categories:

+Single family detached
+Attached townhouse
+Condominium

The type of home that will work best for you is influenced by a number of factors, including your desired lifestyle and activities, your comfort level for upkeep such as repairs and maintenance as well as your future housing plans and needs.

Single family detached homes generally give you the most freedom (you can customize the home as you wish, with the caveat that there may be neighborhood covenants that limit that). In addition, single family detached homes are built on their own lot, meaning you have a yard as part of your home. With that, though, comes the obligation of repairs and maintenance to the entire property, with all of the expense borne by the homeowner. You can find more on single family homes with some advantages and disadvantages on the site at: Single Family Homes

Townhouses can generally be described as a townhouse as a home that is attached to one or more other houses, but which sits directly on a parcel of land that you also own. Depending on the community, you may have some flexibility on how you decorate the exterior of your townhouse and there may be a yard available on your parcel as well as some common areas in the community. Although all of the maintenance on the interior of the home will be your responsibility, townhouses often offer a “middle ground” since much of the exterior maintenance may be provided. If that is the case, you will have a monthly homeowners fee which will provide for the maintenance as well as other amenities such as pools, the common areas, trash and snow removal and more, depending on the community. You can find more on townhouses with some advantages and disadvantages on the  site at: Townhouses

Condominums can take many forms, but they generally are a group of individual units, usually in the same building or buildings, where the homeowner owns the interior of the unit but the building structure (from the foundation to the roof) is owned by the condominium association. Here you will generally have very little flexibility in the exterior of the property. The condominum association may even dictate the color of the draperies visable on the outside. Exterior maintenance is almost always covered by your condominium fee but all interior maintenace will be the responsibility of the homeowner. You can find more on condominiums with some advantages and disadvantages on the site at: Condominiums

It is important to get your decision right at the onset, so it makes sense to invest some time making comparisons, factoring i what you are comfortable with. If you buy the right type of property, it will greatly enhance your ownership experience. On the flip side, though, if you buy the wrong kind of property, it can be a frustrating and expensive process.

Next Month’s Tip: Sharpen Your Budget Skills 

The Home Buying Checklist
Many of our visitors have said that one of the most valuable aspects of the Home Buyer’s Information Center is the Buying Checklist, where they can make sure that all the bases have been touched. You can find the checklist here.

As always, if you have suggestions for improving the site, or topics you would like to see addressed in this newsletter (or, if you have used the Home Buyer’s Information Center to successfully purchase a home), drop us a quick line here.

A special thanks to all those who have written to let us know that they have found the Home Buyer’s Information Center a helpful resource in their buying process.

Have a great month and good luck in all your endeavors!

The Team at the Home Buyer’s Information Center