Reducing the Size of New Homes
written by Tom Witzel
Last Updated: Saturday, April 24, 2010
The American house of 2020 will likely be smaller, smarter, more urban and efficient.
It might not look like a space-age Jetsons set, but just as iPhones and Google have revolutionized personal computing, technology will boost home IQ.
More houses will have energy meters that track power usage and program appliances to run when electric rates are lowest.
Houses also will waste less energy because they'll have better insulation and windows.
The house of the future will be built significantly "tighter," says Nate Kredich of the U.S. Green Building Council.
Builders already are including basic features such as programmable thermostats, found a January survey by the National Association of Home Builders. "It's not rocket science, but it helps control energy costs," says NAHB's Stephen Mellmen. "Affordability is driving these decisions."
Perhaps the most obvious change will be home size. Of builders surveyed, 96% plan to build smaller. The trend began with upscale buyers before the recession and has intensified, says Kermit Baker of Harvard University's Joint Center for Housing Studies.
A new single-family U.S. house averaged 2,373 square feet last year, down from 2,507 in 2007, according to Census Bureau data.
Production builders such as Pulte are reducing the average size of their new models and offering more eco-features such as solar panels. KB Homes is now offering pre-wiring for electric vehicle charging stations.
A decade ago, Kredich says, low VOC (volatile organic compound) house paints were pricey, but costs have come down.
"We can expect to see the same phenomenon in categories such as photovoltaic (solar) technology where costs to date have been largely prohibitive," he says.
Alex Wilson, executive editor of BuildingGreen, a Vermont-based company that publishes books and an online newsletter, expects lower prices and improved performance to make solar water heaters and rooftop panels "very common" by 2020, used in at least 30% of new houses. Other changes he sees:
•Smart growth. More houses and apartments will be built in areas close to public transit, walkways and bike paths.
The Environmental Protection Agency says house-building permits more than doubled since 2000 in the downtowns and close-in suburbs of 26 of the nation's largest metro areas.
•LED lighting. This will gain market share but is still costlier than compact fluorescent.
•Ductless heating. Geothermal heat pumps will be replaced by lower-cost, ductless "mini-split" air-source heat pumps, predicts Wilson. He says ductless technology is improving, and while most manufacturers are now Japanese, more U.S. firms will move into the market.
•Efficient windows. Triple-glazed, low-emissive windows will become common, accounting for up to a third of sales in colder climates. It also will become common to "tune" windows, Wilson says, by using different glass on a home's south side than on its east or west.
Readers: What do you think the home of the future will be like?
Home Ownership Some Items to Think About
written by Tom Witzel
Last Updated: Saturday, April 24, 2010
New Home, New Expenses: First-Time Home Buyers Change Their Lifestyle to Afford Home Ownership
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RISMEDIA, April 17, 2010—BBVA Compass recently released a new survey on first-time home buyers indicating that, prior to purchase, a vast majority of first-time home buyers (88%) believe they have accounted for all expenses related to owning a home. Seemingly contradicting that notion, amongst those who had purchased a home in the past 12 months, just over half indicate the expenses were more than they had calculated, causing a change in lifestyle. These results came from the BBVA Compass First-Time Home Buyers Online Survey which polled American consumers about the thoughts, emotions and hurdles related to owning and enjoying a first home.
Regarding potential first-time home buyers, key findings included:
-Nearly one third have anxiety over the affordability of owning a home.
-7 in 10 indicate that the first-time home buyer’s tax credit has not truly factored into the timing of when they decide to purchase a home.
-92% of respondents indicate that having additional time before their first payment due date would be helpful.
Regarding first-time home buyers who have purchased a home in the previous 12 months, key findings included:
-51% indicated that the monthly expense of owning a home was more than they calculated.
-Although 7 in 10 respondents said that the unexpected expenditures leveled out over time, another 87% said they changed their lifestyle as a result of the additional expenses.
-Nearly one third indicated that they paid for these unexpected expenditures with a mixture of cash and credit, perhaps indicating a lack of liquid funds.
“Owning a home is still the definition of the American Dream,” said Shelaghmichael Brown, BBVA Compass senior executive vice president and head of Retail Banking. “Yet, while the dream is alive and well, the expenses associated with owning a home can be surprising. As a financial institution, BBVA Compass is committed to educating consumers—with clarity and transparency—on the true costs of homeownership.”
Also among the findings of the BBVA Compass First-Time Home Buyers Online Survey was information related to the actual process of purchasing a home. Potential first-time home buyers indicated that when looking for financing on their new home purchase, the item that will be most important to them, but likely also the most confusing aspect, is understanding the process. Ultimately, the first-time home buyer is seeking someone who will provide clarity through each step of the process, from loan options to factors that might affect the rate obtained.
Both segments of first-time home buyers were also overwhelmingly in favor of mortgages that allow breathing room between closing and the due date of the first payment. With this financial cushion, the first-time home buyer indicated that they would be in a better position to pay off credit cards and other bills, as well as make some of those unexpected purchases (household items and improvements) that come along with owning a home.
“Obtaining a mortgage can be a very confusing and expensive process, particularly for the first-time home buyer,” said Jon Mulkin, executive vice president and director of consumer asset products. “The more clarity, transparency and help in making the financial transition from renter to buyer that banks can provide, the better positioned the consumer will be going into long-term homeownership.”
For more information, visit www.bbvacompass.com.
Tips for Home Buyers
written by Tom Witzel
Last Updated: Saturday, April 24, 2010
4 Things First-Time Home Buyers Need to Know about Home Inspections
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RISMEDIA, April 21, 2010— A professional home inspection can not only provide a great education about the home’s systems, but also be a crucial tool in negotiating the most equitable price on the home, according to HouseMaster, one of the first and largest home inspection franchisors in North America.
“Our experience and research shows that approximately 40% of resale homes have at least one defect that can cost a home buyer a minimum of $500 to repair,” said Kathleen Kuhn, President of HouseMaster.“A home inspection by a professional and qualified home inspector is an excellent tool to encourage home sellers to make repairs or make further price adjustments as a result of conditions noted in the inspection report.”
According to the National Association of Realtors (NAR), in 2009, a record 47% of homes sold were purchased by first-time buyers. Tax credit incentives from the federal government of up to $8,000 and historically low mortgage rates continue to attract first-time buyers to the market. A professional home inspection not only educates buyers on the condition of the home but can minimize costly surprises down the road. HouseMaster provides the following tips to ensure that first-time buyers make an educated decision when purchasing a home and get the best price possible.
1. Inspect the Inspector. Only hire a home inspector with an excellent reputation and credentials. Ask how long the company has been in business, ask about specific formal training and ongoing education the inspector has and verify the inspector carries professional liability insurance also known as “Errors & Omissions” (E&O). If the company doesn’t carry this insurance, it could indicate a poor track record or lack of experience.
2. Ask for a sample of a report. The credentials of the inspection company and the quality of the final inspection report will be important. A poorly prepared report without pictures or clear, concise details addressing all the various systems and accessible elements of the home is less likely to be taken seriously by a home seller.
3. Inspect ancillary systems. It’s hard for first-time home buyers to know what they need, so be sure to ask what additional services the company offers. If the home you are considering has a septic system for example, a professional home inspection company may offer septic system inspections or can coordinate that service for you. Generally, the company will offer you a multiple services discount as well as the added convenience of only having to attend one inspection appointment. Other common services offered by home inspectors are termite inspections, mold screening, water testing and radon testing.
4. Go along on the inspection. Ask the inspection company if they encourage buyers to tag along on the inspection. If the inspector discourages you from going along and asking questions, find another inspector. A home inspection is not simply a laundry list of what is wrong with the home. In addition to documenting issues and needed repairs that may exist, a professional home inspector will also show the new buyer how to operate the various systems in the home and provide tips on improving energy efficiency and maintaining the home in general. And being present during the inspection will make the final written report that much more meaningful.
For more information, visit www.housemaster.com.
February Housing Numbers
written by Tom Witzel
Last Updated: Thursday, March 11, 2010
This information is courtesy of Metrolist.
|
|
|
% Change vs
|
|
|
Feb 2010
|
Prior Month
|
Year Ago
|
|
Single Family (Res + Cond)
|
|
Active
|
18,869
|
8.04
|
-5.93
|
|
Pending
|
480
|
50.00
|
-
|
|
Under Contract
|
4,414
|
19.62
|
5.52
|
|
Sold
|
2,436
|
3.53
|
-1.93
|
|
Average DOM
|
95
|
8.45
|
-11.13
|
|
Average Sold Price
|
$247,471
|
3.91
|
13.51
|
|
Residential
|
|
Active
|
14,058
|
7.89
|
-7.68
|
|
Pending
|
389
|
41.45
|
-
|
|
Under Contract
|
3,459
|
19.98
|
3.19
|
|
Sold
|
1,913
|
3.91
|
-4.73
|
|
Average DOM
|
92
|
2.22
|
-14.02
|
|
Average Sold Price
|
$269,688
|
3.52
|
13.83
|
|
Condominium
|
|
Active
|
4,811
|
8.48
|
-0.41
|
|
Pending
|
91
|
102.22
|
-
|
|
Under Contract
|
955
|
18.34
|
14.92
|
|
Sold
|
523
|
2.15
|
9.87
|
|
Average DOM
|
108
|
27.06
|
-0.92
|
|
Average Sold Price
|
$166,206
|
5.39
|
20.23
|
Short Sale Website
written by Tom Witzel
Last Updated: Tuesday, March 09, 2010
I have created a new website with information to answer questions about short sales and to give you information concerning the advantages of a short sale versus a foreclosure. The website address is denvershortsaleanswers.com Please contact me at 303-808-2206 with any questions you may have.
Distressed Homeowners Meeting
written by Tom Witzel
Last Updated: Tuesday, March 09, 2010
I am holding a distressed homeowners meeting on April 22nd from 7 to 8 PM at my office located at 9737 Wadsworth Parkway Westminster, CO 80021. The meeting will consist of a short power point presentation and the opportunity to hear Oliver Frascona a nationally recognized real estate attorney. If you or a friend or family member are behind on your mortgage payment the meeting will be very informative as we will discuss the options you may have. The meeting is free and is open to the public. Seating is limited so I am asking that you R.S.V.P. no later than April 16th by phone 303-808-2206. I hope to see you there!
January Housing Numbers
written by Tom Witzel
Last Updated: Monday, March 08, 2010
The following information is from Metrolist.
|
|
|
% Change vs
|
|
|
Jan 2010
|
Prior Month
|
Year Ago
|
|
Single Family (Res + Cond)
|
|
Active
|
17,465
|
6.13
|
-11.56
|
|
Pending
|
320
|
-
|
-
|
|
Under Contract
|
3,690
|
21.86
|
-3.68
|
|
Sold
|
2,353
|
-20.48
|
-4.70
|
|
Average DOM
|
89
|
-0.10
|
-11.71
|
|
Average Sold Price
|
$238,155
|
-6.93
|
11.64
|
|
Residential
|
|
Active
|
13,030
|
6.25
|
-13.40
|
|
Pending
|
275
|
-
|
-
|
|
Under Contract
|
2,883
|
21.59
|
-8.01
|
|
Sold
|
1,841
|
-20.92
|
-5.25
|
|
Average DOM
|
90
|
2.27
|
-9.09
|
|
Average Sold Price
|
$260,530
|
-7.53
|
12.84
|
|
Condominium
|
|
Active
|
4,435
|
5.77
|
-5.66
|
|
Pending
|
45
|
-
|
-
|
|
Under Contract
|
807
|
22.83
|
15.78
|
|
Sold
|
512
|
-18.86
|
-2.66
|
|
Average DOM
|
85
|
-8.60
|
-20.56
|
|
Average Sold Price
|
$157,701
|
-1.68
|
6.19
|
© 1998-2010 Metrolist, Inc. All rights reserved.
Colorado Finance Housing Authority
written by Tom Witzel
Last Updated: Thursday, January 28, 2010
There are changes coming to the CHFA loan programs. CHFA loan programs help people purchase homes that don't have the 3.5% downpayment for a traditional FHA loan and meet certain requirements. The article from CHFA is listed below.
CHFA FirstStep and CHFA FirstStep Plus
Beginning February 1, 2010, CHFA is pleased to announce the CHFA FirstStep and CHFA FirstStep Plus programs for first time homebuyers and eligible veterans. Both programs have income and purchase price limits and are subject to the (CHFA reimbursable) Federal Recapture Tax. Both Programs require all tax exempt affidavits, disclosures, and three years of tax returns from the Borrower.
The CHFA FirstStep Plus also offers a CHFA Second Mortgage Loan for down payment and/or closing costs. The CHFA Second Mortgage Loan is for a maximum of 3 percent of the first mortgage; its rate and term mirror the first mortgage.
Upcoming Changes For All CHFA Borrowers
Effective for all reservations beginning February 1, 2010
· All CHFA Second Mortgage Loans are now subject to the RESPA requirements. Any CHFA Second Mortgage Loan must now have a Good Faith Estimate as well as a HUD-1A Settlement Statement. These forms and comprehensive instructions will be available on our website. This eNews supersedes the RESPA requirements regarding GFEs in the eNews released 12.31.09.
* Borrower minimum financial contribution will continue to be $1,000; however, now it must come from the Borrower's own funds. Gift funds will not be allowed. CHFA will require verification of funds in the Borrower's depository institution for no less than 60 days.
* Cosigners will not be allowed. For the past few years, CHFA has required that all Borrowers qualify on their own to purchase their home even if there were cosigners. To eliminate confusion, cosigners will no longer be permitted.
* Non-Traditional/Emerging Credit Reports must be developed by a credit reporting agency for all Borrowers with insufficient or non-traditional credit. CHFA will continue to serve the non-traditional credit Borrowers, but Participating Lenders will now be required to provide an actual alternative/emerging credit report from a credit reporting agency, as opposed to providing pay histories from individual creditors or a lender-developed alternative credit history.
* CHFA Risk Information Score Card (CHFA RISC). CHFA will continue to serve the 580-619 credit score Borrower; however, for all loans to Borrowers and Co-borrowers having credit scores between 580 through 619, a new credit score card must be completed and submitted to CHFA with the Compliance file. The CHFA RISC Score Card and instructions will be available on our website at www.chfainfo.com
The Denver Metro Area A Good Place To Buy A Home
written by Tom Witzel
Last Updated: Thursday, January 28, 2010
The folowing article was supplied by Dee Hibl of Colorado Mortgage Alliance.
10 Cities where it's smarter to buy
For people who want to own a home, the premium to buy-the spread between what they'd spend to rent and what they'd pay for a mortgage-is much lower than the 15-year average in many cities. To determine what cities are smart buys, Forbes magazine computed the premium and also identified locales where economists predict home prices will go up the most over the next five years.
Here are the top 10 cities the magazine chose as the best places to buy right now.
1. Boston-Cambridge-Quincy, Mass.
2. Charlotte-Gastonia-Concord, N.C.-S.C.
3. Chicago-Naperville-Joliet, Ill.-Ind.-Wis.
4. Cincinnati-Middletown, Ohio-Ky.-Ind.
5. Denver-Aurora-Broomfield, Colo.
6. Minneapolis-St. Paul-Bloomington, Minn.-Wis.
7. Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md.
8. Portland-Vancouver-Beaverton, Ore.-Wash.
9. San Francisco-Oakland-Fremont, Calif.
10. Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.V.
Source: Forbes, Francesca Levy (01/21/2010)
FHA Loan Changes
written by Tom Witzel
Last Updated: Thursday, January 21, 2010
The Federal Housing Administration is making some changes to the FHA loans they insure. The upfront mortgage insurance is increasing and FHA is now indicating that borrowers must have a minimum FICO score of 580 to qualify for an FHA loan with a minimum downpayment of 3.5%, if the FICO score is below 580 then the borrower will have to put down 10%. FHA is also reducing the amount sellers can contrubute to the buyers from a maximum of 6% to 3%. These changes are designed to reduce the amount of loan defaults and to raise FHA reserves that are mandated by congress.
FHA also wants conress to further clamp down on lenders, holding lenders liable if they underwrite loans violating FHA policies & standards. The department of Housing & Urban Development, FHA's parent agency will also ask congress to drop lenders from FHA programs when they violate FHA standards. FHA's hope is that the changes will reduce the number of loan defaults and bring their reserves back into line in the next fiscal year.
New York Federal Reserve
written by Tom Witzel
Last Updated: Monday, January 18, 2010
The following articel was emailed to me by Dee Hibl of Colorado Mortgage Alliance. I sure hope the information contained in this article is right. As always if you would like to contact me just call me at 303-808-2206 or send me an email at tom@tomwitzel.com.
January 14, 2010
New York Federal Reserve Bank President William Dudley said short-term interest rates may remain low for at least six months and possibly for as long as two years.
"Short-term rates are going to stay low for a considerable period of time to come," Dudley said yesterday, according to the transcript of an interview with PBS Television’s Nightly Business Report.
The policy of keeping borrowing costs low could remain in place "at least six months," Dudley said.
"It could be a year from now, two years from now. It’s going to depend on how the economy develops."
The Fed has held the benchmark rate for overnight loans between banks close to zero for more than a year to pull the economy from the worst recession since World War II and reduce joblessness that’s almost at a 26-year high. Policy makers on Dec. 16 affirmed a pledge to maintain the policy for an "extended period."
Before supporting an interest rate-increase, "I certainly need to see an economy that’s vigorous enough to bring the unemployment rate down, number one," Dudley said.
"And two, I would care about what’s going on in inflation."
"We’re doing very well on the inflation side," he said.
"We’re doing not well at all on the employment side."
Losses During Recession
The U.S. jobless rate held in December at 10 percent as employers cut 85,000 jobs, bringing losses during the recession to 7.2 million.
The Fed’s preferred inflation gauge, excluding food and energy costs, rose 1.4 percent in November from a year earlier. Officials prefer long-term inflation of about 1.5 percent to 2 percent.
Last month’s FOMC statement said officials expected inflation to "remain subdued for some time."
Dudley said that some reviews of plans by the Fed to end its purchases of mortgage-backed securities suggest "this is going to have a relatively small effect on the level of mortgage rates, something on the order of 0.5 to 0.25 percent."
The Fed is buying $1.25 trillion of mortgage-backed securities issued by housing-finance companies Fannie Mae, Freddie Mac and federal agency Ginnie Mae. The central bank began the program in January 2009 and plans to end it at the end of March.
‘Big Consequence’
"If mortgage rates were to back up a lot and if that had a big consequence for the economy then we very well could rethink the issue about whether we wanted to buy more mortgages," Dudley said.
The Fed separately purchased $300 billion of Treasury securities from March through September 2009 and is buying, through March, $175 billion of corporate debt issued by government-backed Fannie and Freddie and the government- chartered Federal Home Loan Banks.
The Fed’s Beige Book business survey, released yesterday, said the economy improved in 10 of the central bank’s 12 districts last month. The previous Beige Book, released Dec. 2, showed improvement in eight districts.
"We are getting economic growth," Dudley said.
"That’s going to start translating to employment gains relatively soon, within a few months."
"We’ll definitely see job growth in 2010."
The "labor market conditions remained generally weak with modest wage increases appearing in just a few Districts," the Beige Book report said. Employers cut a greater-than-expected 85,000 jobs in December, the Labor Department said on Jan. 8.
AIG Bailout
Dudley also said the central bank acted in accordance with the law during the bailout of American International Group Inc. and was transparent in its handling of the firm.
"We have acted completely in the spirit of the law, letter of the law in everything that we’ve done," Dudley said.
"We had been transparent throughout this process."
The New York Fed was ordered yesterday by a House committee to provide Timothy Geithner’s e-mails, phone logs and meeting notes tied to the bailout of AIG. Geithner, now U.S. Treasury secretary, was president of the New York Fed when AIG was rescued.