Predicting the Real Estate Market

This will probably get me in a real fix...not a good idea to predict...Oh well the Lord hates a coward. The biggest thing to remember is that for the most part Real Estate is local. The Philadelphia area has historically held its own in Real Estate turn down cycles. The past has shown a typical adjustment in this region of about 10% . With some areas actually showing equity gains and others maybe deeper adjustments. We live in an area of diversified industries and job markets. This helps offset any major unemployment spikes. Any way back to the Real Estate market. As long as there is not a major change in the economy for any reason, it comes down to supply and demand. The inventory of homes for sale should start to dwindle over the next couple of months. The sellers who wished they would have sold two years ago will either SELL or decide not to and stay where they are. Although there may be a greater influx of short sales and REO sales the lenders will figure out some of the prices they are trying to get are not realistic...investors will be able to acquire them at a faster rate as the REO departments become better managed. Buyers can still get reasonable mortgages ...FHA is not new...we at JB Realty Service have been doing FHA loans for over 20 years....mortgage brokers and realtors just got lazy over the last few years and used the quicker and less regulated 100% conventional loans. They will need to become educated OR re-educated with these loans and the consumer wins. These loans have continued to be at the top of options for all qualified buyers. I think all is in place for us to see the bottom over the winter with a return to a normal Real Estate market next spring...Normal does not mean the hyper market of three or four years ago but more stable prices and reasonable sale times of 2-5 months. I will talk about interest rates next time....Watch out for interest rate spikes coming. In the mean time, check us out at http://www.jbrealtyservice.com./

Lets end the economic down turn

It is my opinion that if two things were done NOW we would create an economic boom. ONE,,,, make the tax cuts permanent. TWO,,,, announce to the world, We have had enough .... we will start drilling for oil ,tap the natural gas reserves and give massive tax breaks for all new technology leading to energy independence. I am having a difficult time believing this is that difficult an idea to grasp.' Demand out paces supply...increase supply and decrease demand.....not either /or. I am sure there will be fifty reasons we will be told why it cant be done . Are we that weak a Nation we give in so easy? This should have been done years ago. So we cant go back...but we can start NOW.

home values

For the purpose of a refinance and a sale, the property will most likely be appraised to judge its value for purpose of a loan. What consumers do not realize is that the appraiser works for the lender. The lender is the client not the home owner or the buyer.The consumer may recieve a copy of the report for limited use or just for their records. The lender, as the client of the appraiser, sets the scope within which the appraisal is performed. When the client (lender) asks that the scope of work include only the most recent transactions of the last 2-3 months this can result in great strain for certain properties. How can properties not decline in value under these strick conditions. Sales to use as comparables have been sparce. If sales are occuring they are most likely under distress. Now we have created a self fulfilling prophecy. Property values will continue to decline because of the enviorment that is being created. We all understand the mees the lenders are in nationwide...BUT...REAL ESTATE markets are local. The lenders are looking for safe loans. Understood. Wide sweeping guidlines are NOT the answer.

prepare to buy investment property

Preparing to be in a position to purchase properties in the up coming months you will need a little understanding of some events that may be inevedable. First as seen in the news there is a major mortgage mess...the effect this has on you is that finding financing for the investment property is going to be more difficult. In the past investors could purchase properties with little or no money down,no more. The lenders are changing their qualifiing criteria every week. Lets just focus on one aspect..more and more the lenders are requiring more down payment..20% down on a $200,000 property is $40,000 plus closing fees. If you find that investment property will you have these funds available to you ? One way to get the money would be from the equity you have in an existing property(investment or primary home).If you wait and try to refinance under pressure to access the funds at the same time you are negotiating the purchase it will not only be stressful but it will not be the best postion to negotiate from. Sellers are not ussually fond of contingencies in the purchase offer.Also consider Your properties are probably at a higher value now than they will be in the up comming months. You may want to liquify those equity dollars now to have the funds in place when the oppurtunity arises to make the investment purchase.

NEW FHA LOAN LIMITS

First time buyers, first time sellers looking to move up in the home market, and also those current property owners struggling with adjustable mortgages should benefit the most by the latest government move which increases FHA loan limits. The new limits should have a positive affect on the housing industry everywhere. In the Bucks, Chester, Delaware and Montgomery county areas of Pennsylvania the limits have been adjusted up about 50% from approx. $285,000 to $420,000. THESE CHANGES ARE SET TO EXPIRE AT THE END OF THE YEAR. These government backed mortgages are generally easier to qualify for and require a very low down payment of 3% in most cases. Housing and Urban Development (HUD)which cooperates with the Federal Housing Administration (FHA) gets to have a major impact on the criteria to qualify for FHA loans. We at JB REALTY SERVICE LLC find these loans are a great tool for those who are just graduating college or trade school and may not have established a long work history, borrowers with low cash reserves that may be getting funds from relatives, and buyers in need of assistance from sellers with monies toward closing costs. Credit score levels are also more forgiving. Buyers must be aware not all lenders are approved to offer these FHA loans. Contact john@jbrealtyservice.com. We can advise you on all your real estate and mortgage needs, also read the blog at http://www.jbrealtyservice.com/.

PREPARE FOR THE WORST

Investors and home owners are in for some rocky times they may not be aware of. The tax cuts are set to end in 2010. One of the changes that interest me is "The Capitol Gaines Tax". The old tax, which it is set to revert back to, as I remember was 28% federal when adding your state tax a total of 30% and higher. How many of you bought a second home or investment property over the last 7 years or so. HOW MANY OF YOU ARE THINKING OF SELLING? You may want to think about selling before the tax resets. How about home owners thinking of retirement or moving out of the area. Currently if you have lived in your property as a primary residence for 2 out of the last 5 years,have not sold another primary residence and the sale is less than $500,000 for a married couple you probably will pay no tax. This benefit may also change,for more information put our team of experts to work for you,contact. john@jbrealtyservice.com . A FREE EVALUATION of your specific situation is available by appointment.call 215-721-6300.Also you can read more at WWW.JBREALTYSERVICE.COM

YOU MUST CALL NOW

If you, or anyone you know, have an adjustable and/or sub-prime mortgage, or maybe you don't know what type of mortgage you do have, you could be in for a substantial mortgage payment increase. We will evaluate your current mortgage situation and qualify you for a government assisted program to help reduce these payments. This evaluation is FREE. Read more at my blog at JBrealtyservice.com. We can HELP if you contact us. Call 215-721-6300 or E-mail me at john@jbrealtyservice.com