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It’s settled. Come January 20, 2009, Barack Obama will be the new guy in the White House and he definitely has his work cut out for him. For one thing, he’ll be dealing with with a very real issue in housing and it becomes important for all of us, regardless of any and all political leanings, to take a closer look at how the man intends to address the situation. The following is taken directly from his website:

Protect Homeownership and Crack Down on Mortgage Fraud

Obama and Biden will crack down on fraudulent brokers and lenders. They will also make sure homebuyers have honest and complete information about their mortgage options, and they will give a tax credit to all middle-class homeowners.

• Create a Universal Mortgage Credit: Obama and Biden will create a 10 percent universal mortgage credit to provide homeowners who do not itemize tax relief. This credit will provide an average of $500 to 10 million homeowners, the majority of whom earn less than $50,000 per year.
• Ensure More Accountability in the Subprime Mortgage Industry: Obama has been closely monitoring the subprime mortgage situation for years, and introduced comprehensive legislation over a year ago to fight mortgage fraud and protect consumers against abusive lending practices. Obama’s STOP FRAUD Act provides the first federal definition of mortgage fraud, increases funding for federal and state law enforcement programs, creates new criminal penalties for mortgage professionals found guilty of fraud, and requires industry insiders to report suspicious activity.
• Mandate Accurate Loan Disclosure: Obama and Biden will create a Homeowner Obligation Made Explicit (HOME) score, which will provide potential borrowers with a simplified, standardized borrower metric (similar to APR) for home mortgages. The HOME score will allow individuals to easily compare various mortgage products and understand the full cost of the loan.
• Close Bankruptcy Loophole for Mortgage Companies: Obama and Biden will work to eliminate the provision that prevents bankruptcy courts from modifying an individual’s mortgage payments. They believe that the subprime mortgage industry, which has engaged in dangerous and sometimes unscrupulous business practices, should not be shielded by outdated federal law.

On a positive note, the proposal for a universal mortgage credit as well as the plan to allow families to withdraw up to 15 percent from either their IRA or 401(k) to a maximum of $10,000 without any fine or penalty could be a shot in the arm for the market and that’s always a good thing. However, the proposals, at least as much of it as we’ve seen so far, still falls short of what a lot of people hope it will do.

It doesn’t exactly help the cause of homeowners who are already behind on their mortgages nor does it make much of an impact on property values.

Worse yet, Obama’s plan makes it far less attractive for lenders to lend to consumers unless they have nearly perfect credit scores or are willing and able to put down a large downpayment. The way I see it, allowing bankruptcy judges to restructure an individual’s mortgage payments is rather questionable. Knowing that a judge could come in and suddenly change the terms of a deal would discourage any investor. Lenders would also be forced to give higher interest rates to offset that risk.

So what does all this tell us? Truthfully, not a whole lot at the moment. Because plans by their very nature are subject to change. In this case, I’m really hoping that they do. There are still a lot of aspects to the issue that needs to be addressed. As things stand though, it seems to me that right now really is the best time to invest in real estate.

U.S. mortgage applications rise 2.8%

By PBN Staff 

WASHINGTON – The number of mortgage applications filed nationwide last week rebounded from the 2008 low of the week before, as rates dipped slightly, the Mortgage Bankers Association said today in its weekly report.

The trade group’s seasonally adjusted Market Composite Index – a measure of overall mortgage loan application volume – rose to 432.6 points in the week ended Aug. 1. That represented an increase of 2.8 percent from the previous week’s 420.8 points but a decline of 33.7 percent from the same week a year earlier. 

The weekly survey, conducted by the MBA since 1990, covers about half of retail mortgage originationsnationwide.

The MBA’s seasonally adjusted Purchase Index rose 1.8 percent to 315.2 points last week from 309.5 the week ended July 25. The Refinance Index rose 4.4 percent to 1,121.9 points from 1,074.4 the week before. 

Refinancing attempts accounted for 35.9 percent of total mortgage applications, up from 35.32 percent the week before, the MBA said. Meanwhile, applications for adjustable-rate mortgages (ARMs) fell to 6.9 percent of the total from the previous week’s 7.3 percent.

The average contract interest rate for a 30-year fixed-rate mortgage dipped to 6.41 percent in the week ended July 25 from 6.46 the week before, as the average rate on a 15-year fixed-rate loan edged up to 6.02 percent from the preceding week’s 5.98 percent. The rate on a one-year ARM declined to 7.17 percent from the 7.25 percent average of the week ended July 25. 

“Home loans are tougher to get for some borrowers and more expensive for others,” Michael Larson, an analyst at Weiss Research in Jupiter, Fla., told Bloomberg News. “I expect sales to remain subdued and prices to slump, albeit at a more gradual pace” 

The Mortgage Bankers Association is a trade group representing the real estate finance industry. Its 3,000 member companies include mortgage firms, commercial banks, thrifts, life insurance companies and others. Additional information, including the MBA’s Weekly Application Survey, is available atwww.mortgagebankers.org.

Sweeping legislation offers some relief for home, mortgage markets

Aims to stem tide of foreclosures

Thursday, July 31, 2008

By Patricia Sabatini, Pittsburgh Post-Gazette

Post-Gazette

The housing bill signed into law by President Bush yesterday aims to prop up the hobbled home and mortgage markets and stanch a flood of foreclosures.

But provisions targeting consumers aren’t just for people on the cusp of losing their homes.

Tax and other breaks cut a wide swath extending to first-time home buyers, military personnel and to senior citizens planning on a reverse mortgage. There’s even something for homeowners who have managed to pay off their mortgages.

For those who don’t want to miss out, here’s a look at some of the key measures of the act and a rundown of which taxpayers are likely to benefit:

• Rescue plan for home-owners on the brink.

Called the Hope for Homeowners Program, it gives people who are struggling to keep their homes a chance to refinance at better terms under a government-backed loan if the lender agrees to forgive a portion of the debt (the amount of the mortgage balance that exceeds 90 percent of the home’s current value).

This cornerstone of the housing legislation is intended to ease a shock wave of foreclosures. Many homeowners are in crisis because of rising rates on adjustable-rate loans. They can’t meet payments, but can’t sell or refinance because of falling home prices, which put them in the position of owing more money than their homes are worth.

Under the rescue plan, to be administered by the Federal Housing Administration, new mortgages must have a fixed rate for a term of at least 30 years and be no more than 90 percent of the home’s value. Home equity loans will be prohibited during the first five years. In addition, the borrower will pay an annual fee of 1.5 percent on the remaining loan balance.

The program, which takes effect Oct. 1 and ends Sept. 30, 2011, is expected to help at least 400,000 distressed homeowners, but lenders are not required to participate. Financial institutions won’t want to forgive any debt unless they are pretty sure the property is headed for foreclosure, a situation in which they could lose even more.

To be eligible, participants’ monthly mortgage debt must have consumed at least 31 percent of monthly income as of March 31, 2008. For example, households earning $4,000 a month would qualify if their mortgage payment — including principal, interest, taxes and insurance — was at least $1,240 a month. ($4,000 x 31 percent = $1,240).

In addition, the mortgage must have been originated on or before Jan. 1, 2008, and be on the borrower’s principal residence.

If the property is sold within five years, up to 100 percent of the gain — in other words, any equity in the home — goes to the government. If the homeowner sells after five years, 50 percent of the proceeds go to the government.

• First-time home buyer tax credit.

This provision gives first-time home buyers a tax credit of up to $7,500 for singles and married couples filing jointly ($3,750 for married people filing separately), which they can claim on their 2008 or 2009 federal tax returns. The credit is equal to 10 percent of the purchase price of the home, or $7,500, whichever is lower.

The credit comes directly off the home buyer’s federal income tax liability. Taxpayers who owe less than the credit is worth, get a check for the balance. If, for example, the home buyer receives the maximum $7,500 credit but owes just $3,000 in income taxes for the year, he or she would receive a refund of $4,500.

The program covers homes purchased after April 9, 2008, and before July 2009.

Intended to goose home sales, this is the biggest tax credit in the new law. Unlike other individual tax credits, however, this one must be repaid in equal installments over 15 years, making it more of an interest-free loan than an actual credit. The way it works, someone receiving the full $7,500 credit would owe an additional $500 in taxes a year until the money is paid back in 15 years.

Repayment begins two years after the home is purchased. If the house is sold before 15 years, then the entire balance comes due. The credit does not have to be repaid if the taxpayer dies.

The credit is for first-time buyers only, which is defined as someone who did not own a residence in the prior three years.

The credit starts to phase out for couples with modified adjusted gross income above $150,000 and phases out completely at more than $170,000. For singles, the phaseout starts at $75,000 and the credit drops to zero above $95,000.

• Property tax deduction for nonitemizers.

Taxpayers who take the standard deduction instead of itemizing will be able to deduct an additional $500 ($1,000 for married people filing jointly) from their taxes. This break is available for only 2008, although legislators could extend it.

People who pay less than those amounts in property taxes will be limited to deducting their actual property taxes.

This measure will benefit many homeowners who have paid off their mortgages, since they are the ones who typically do not have enough deductions to make itemizing work.

In 2008, the standard deduction for joint filers is $10,900. People taking advantage of the special property tax break would deduct $11,900.

• Special breaks for seniors and veterans.

The new law puts restrictions on reverse mortgages to help people 62 and older who are looking to tap the equity in their home.

The measure limits origination fees for federally insured reverse mortgages to 2 percent of a loan up to $200,000, and 1 percent above that, up to a maximum of $6,000.

The legislation also bars lenders from forcing borrowers to buy an annuity or other financial or insurance product to qualify for the loan.

In addition, it raises the maximum homeowners can borrow, aiding people in high-cost areas.

In the case of veterans, mortgage lenders must wait at least nine months, up from 90 days, to start foreclosure proceedings on someone returning from military service and a year before raising the interest rate on a loan. These special provisions expire at the end of 2010.

The nonprofit Homeownership Preservation Foundation operates a national hot line offering free counseling to help people avoid foreclosure. It’s available 24 hours at 1-888-995-4673. Patricia Sabatini can be reached atpsabatini@post-gazette.com or 412-263-3066.

First published on July 31, 2008 at 12:00 am

Home Trust to offer traditional mortgages

Alternative lender believes competing with banks will lower risk, allow it to pick up more business

August 6, 2008

Alternative lender Home Trust Co. is launching a line of traditional mortgage products that will compete directly with those offered by the banks.

The Toronto-based lender hasn’t been pushed out of lending to riskier borrowers, a problem encountered by some of its competitors as a result of the U.S. subprime crisis.

Instead, the company, which uses a deposit-based funding model, believes the move will help fuel the growth of its core alternative-loan business and its relationships with mortgage brokers.

“What we can offer is a one-stop shop, particularly for brokers where time is of the essence for their clients,” said Gerald Soloway, chief executive officer of Home Trust’s parent, holding company Home Capital Group Inc.

 ”We’ve been looking out over the economy trying to figure out how we can expand our business, but lower our risk profile. This is a good way to do that.”

The goal is to allow brokers whose clients are on the edge of qualifying for a traditional mortgage the option of pursuing that route first.

If they don’t succeed, for reasons that could include an insufficient credit score or income verification, they can then turn to a more expensive alternative product offered by Home Trust.

The new line is the latest in a series of successful product rollouts by the company, which also include credit card and commercial mortgage loans, said Jeff Fenwick, an analyst at Cormark Securities Inc.

“The management there are very good business operators. They’re very good lenders, they are cautious about where they lend, and are able to capitalize on new opportunities,” Mr. Fenwick said.

Unlike some of its competitors that relied on bundling and selling uninsured loans to fund new mortgages, Home Trust is a deposit-taking organization, whose eligible deposits and financial products are insured byCanada Deposit Insurance Corp.

Its new insured mortgages, marketed under the Accelerator Program name, will be sold into the Canada Mortgage and Housing Corp.’s bond program. At maturity, Home Trust will have the option, upon renewal, of putting them back on to its own books, Mr. Soloway said.

Thus far, Home Trust’s alternative loan business has continued to thrive.

Home Capital reported yesterday that sales and profit were up 20 per cent in the second quarter from the previous year.

The strong results likely drove the stock’s 6.7-per-cent gain yesterday, Mr. Fenwick said.

Part of the growth in business came from picking up residential mortgage business from fallen competitors, it said.

The company’s ability to fill the gap and find new growth opportunities should help it withstand a slowdown in the Canadian housing market, Mr. Fenwick said.

Starting in 2009, the Accelerator mortgages are expected to add about 20 per cent, or $500-million a year, to the company’s new mortgage business, Mr. Soloway said.

Yesterday, Home Capital also said it was raising its dividend by 1 cent a quarter to 52 cents a year, in part owing to its confidence in the Canadian mortgage and housing markets.

The mortgage market in Canada , with few exceptions, still appears strong and defaults are low, Mr. Soloway said.

Special Report Mortgage Meltdown

Home buyers may find big savings in locking in mortgage interest rates.

By Les Christie, CNNMoney.com staff writer

August 4, 2008: 4:21 AM EDT  

NEW YORK (CNNMoney.com) — With mortgage interest rates on the rise, home buyers can save considerable cash by locking in a reasonable rate deals when they find one.

During the housing boom, interest rates were extremely low - generally between 5.5% and 6.5% - and very stable. So borrowers often didn’t bother to ask their lender to lock in their rates, which is when a lender promises to give a borrower a certain interest rate, regardless of market fluctuations. If one good deal disappeared, another one was generally right around the corner.

But today the mortgage market is very volatile, and rates are trending upwards. So losing out on a good deal may mean it’s gone forever. If buyers see a bargain, say experts, they should pounce.

“If you hear of a rate that seems to be much better than the rest of market, get it in writing and lock it in,” said Steve Habetz, a veteran mortgage broker in Connecticut .

Mortgage giant Freddie Mac (FRE, Fortune 500) reported Thursday that the average rate for a 30-year fixed stood at 6.52%, up from May when rates were under 6%.

Rates on the rise

And Bankrate.com analysts including Cameron Findlay, the chief economist for LendingTree.com, Mick Larson, real estate analyst at Weiss Research and Dan Dowling, president of United Mortgage Capital Corp. in Altamount , Fla. , all expect rates to go up in the next six weeks.

With the threat of inflation growing and investors wary about buying mortgage securities, some forecasters have predicted rates will hit at least 7% by the end of the year.

For every half point interest rate increase, the monthly payment on a typical mortgage of $200,000 jumps nearly $70. That adds up to more than $800 a year, and $8,000 in the first 10 years of a 30-year mortgage alone.

Locking a rate is easy, as long as you have a contract or at least a binder on a home. Just tell your mortgage broker and he or she will give you a commitment in writing. Locks are available for as long as 60 days, according to Habetz, at very low cost.

Locking in for 60 days may cost only an eighth of a point extra, turning a 6.5% loan into a 6.625% one. Paying that extra eighth of a percent makes sense if the locked rate is below market, or if you expect rates to rise.

“More than 60 days and the lender is usually looking for cash up front,” said Habetz.

Habetz recently had an offer from Wells Fargo (WFC, Fortune 500) several weeks ago that beat anything else available. It was for a 5-year adjustable rate mortgage (ARM) with an introductory rate of 4.875% - at least a full percentage point lower than competing offers.

“It lasted only two or three days,” he said, “and all we had time to do was to get the customers we were already working with into the loan.”

Those customers probably saved themselves $5,000 or so for every $100,000 they borrowed over the first five years. The amazing part of this story, to Habetz, was that not all his clients took advantage of the offer.

“Some of my customers said, ‘That’s an attractive offer. If it’s that good, it will probably get better,’” he said.

Wrong. It only got worse, and those people locked themselves out of a great deal.

But locking in your rate isn’t entirely risk-free. After all, rates might actually go down.

“When rates go down,” said Habetz, “most lenders won’t take [your rate] down with them unless rates drop substantially. Then they may give you the new rate plus an eighth of a point.”

Certainty in an uncertain market

But that scenario appears unlikely.

Concerns about inflation are helping to push rates higher. “Inflation has gone from the back burner to the front,” said Greg McBride, a senior financial analyst for Bankrate.com.

At the same time, nervous investors in mortgage backed securities, are demanding higher rates for buying these bonds in what they deem a very risky market. That translates into higher rates for borrowers.

So locking in a good deal now should mean a lower rate for most borrowers. And besides saving them money, a lock should take some of the uncertainty out of financing a home purchase, since buyers can determine exactly what their monthly home ownership expenses will be several weeks before closing.

“There are times in your financial life when you should be aggressive and there are times when you should be conservative,” said McBride. “When you’re buying a house and looking at mortgage rates, that’s a time to be conservative.”

Selling a rental? Capital gains, 1031 exchange explained

Question: We know that the tax laws allow homeowners to sell their house and keep the profits tax-free, but what about rental properties? We own a rental house and we want to know if we can sell it and keep some or all of the profits tax-free.

J.C., Everett

Answer: While tax laws changed several years ago to allow homeowners to keep up to $250,000 in capital gains ($500,000 for a married couple) tax-free, there has been no such change in the tax laws related to the sale of rental properties.

The only way to avoid paying capital gains tax on the sale of a rental property is to use a 1031 exchange. Internal Revenue Code Section 1031 allows real estate investors to sell an investment property and buy a replacement investment property (or properties) of equal or greater value without paying tax on the profit from the sale of the old property.

The capital gains tax liability is not eliminated. It is merely deferred until the investor ultimately sells the property for cash. That’s why a 1031 exchange is commonly called a tax-deferred exchange.

The 1031 exchange rules are very strict, and they must be followed to the letter or the exchange is invalidated and all profits from the property sale become fully taxable. To qualify for a tax-deferred exchange, you must trade like kind properties, which means both the old and new properties must be held for investment or use in a trade or business. The properties can be raw land, single family homes, apartment buildings, commercial buildings, etc.

Investors have only 45 days in which to identify the replacement property (or properties) in a 1031 exchange, and the transaction must close within 180 days of the closing date on the old investment property. That’s a very tight deadline, which is why investors usually try to find a property they want to buy before closing the sale on their existing property. Since the 45-day clock doesn’t start ticking until the sale of the old property has closed, investors sometimes use an unusually long escrow period of three to six months in order to give themselves more time to locate and negotiate the purchase of a replacement property.

Or, if they are still trying to sell their existing property, they might tie up the replacement property with a lease-option contract, then exercise the purchase option after the old property has sold and complete the transaction as a 1031 exchange.

In a tax-deferred exchange, the replacement property must meet strict eligibility requirements. Not only must the replacement property be of equal or greater value than the property being sold, but the mortgage on the new property must be of an equal or greater amount than the existing debt on the property being sold. Any excess cash that ends up in the exchanger’s hands at the end of the deal is called “boot” and becomes taxable income.

In fact, if the exchanger has what’s called constructive receipt of the sale proceeds from the old property at any time during the course of the exchange, it immediately becomes taxable income and the exchange is invalidated. Constructive receipt simply means the money is available to you, whether you touch it or not. For example, if the money is placed in a savings account to which you have access, that would be considered constructive receipt even if you never withdrew any of the money.

To avoid that pitfall, investors typically hire a professional to handle the exchange. Contrary to popular belief, you do not have to literally exchange one property for another one in order to qualify for a 1031 tax-deferred exchange. In most cases, you simply sell your existing property in the normal manner, but — and this is the important point — you never touch the money. The money is held by the exchange facilitator to whom you have assigned the right and obligation to act as the seller on your behalf. Once you have a contract to buy the replacement property, the facilitator acts as the buyer on your behalf and uses your money to purchase the property. It sounds very complicated, but it is really just a paper transaction. The exchange facilitator appears to be the buyer or seller (depending on which side they’re representing) on all of the escrow papers — except for the deed and excise tax documents. Through a process called direct deeding, the deed to the property being bought or sold by the exchange facilitator is automatically transferred to the buyer or seller at closing. As far as the individual buyers and sellers are concerned, the only difference between an exchange and a normal sale is that there are a extra documents to sign at closing.

When selecting an exchange facilitator, it is important to know who you are dealing with. Remember, the facilitator will be holding your money during the exchange period and you cannot have access to it, so you must be sure that they won’t skip town with your cash. Make sure the exchange facilitator you deal with has a fidelity bond, or some other way to guarantee that your funds won’t disappear during the exchange process.

Mail questions to Steve Tytler, The Herald, P.O. Box, Everett , WA 98206 , or e-mail him at economy@heraldnet.com.

Deal or No Deal: The High Stakes Game for Reunion Arena 

DALLAS, TX (2008-08-04)  Reunion Arena in downtown Dallas sits dark, waiting for the wrecking ball. What happens next to that valuable piece of property could sound like an episode of the television show Dallas a world where a rich oilman called the shots. KERA’s BJ Austin says a 30 year old land-swap deal could put Reunion ’s prime real estate in the hands of a modern-day billionaire.

The front doors of Reunion Arena are locked, and a security guard keeps watch behind the darkened glass. By next spring, the 18 thousand-seat arena that was home to the Dallas Mavericks and Stars will be gone leaving only memories of a Stanley Cup win and sold-out concerts by Pink Floyd, Garth Brooks and Sir Paul McCartney, among others.

What ultimately happens to the 8 valuable acres on the very doorstep of the future Trinity River Park will be up to City Hall and Dallas billionaire oilman and developer Ray Hunt. He’s part of the decision because of a 1974 deal. The city and Hunt swapped pieces of property allowing the city to build Reunion Arena, and Hunt to build the Hyatt Hotel next door.

Standing in the shade of the arena on a hot afternoon, Dallas real estate consultant Marcus Wood believes the property will only increase in value as the Trinity River Park is developed and plans for a nearby Convention Center hotel proceed.

BJ Austin: As we look at Reunion Arena, what do you see as the future of this property?

Wood: Time is going to be a major factor. And who knows what the economy, and particularly the fuel and mass transit, and just those demands are going to be. This could play major roles, and we could see this whole thing become very, very, very valuable as compared to where it is today.

The city could sell the property, develop it, or lease it for development. The 1974 agreement appears to give Ray Hunt first dibs on leasing it, and he also has the right of first refusal to buy the property if the city declares it surplus - in other words, unneeded or unwanted property. And, the agreement includes a complex formula to arrive at the purchase price for the Reunion Tract. No one at City Hall is willing to put a dollar figure to that. But, the Dallas County Appraisal District puts the property’s market value at more than 24 million dollars.

Hunt: I have concerns about the Master Agreement. I have serious concerns about it.

Dallas Council member Angela Hunt - no relation to Ray Hunt — has requested a comprehensive closed door council session with the City Attorney to go over the agreement, and study the city’s options.

Hunt: You know what I’d really like to see us do, especially in this market, is hold onto the property. It’s close to the future convention center hotel. It is one of the closest pieces of property to the Trinity River Park . I think we have a real opportunity over the next ten to 15 years to see that property become a terrific development. I do have concerns that sometimes we get dollar signs in our eyes and we think let’s sell now and worry about the consequences later. We really need to be smarter than that.

During a break at a City Plan Commission meeting, land-use consultant Willie Cothrum - a Dallas City Council member in 1974 — acknowledges years of grumbling about the deal with Ray Hunt.

Cothrum: Was it generous? You know generous is a subjective term. To those of us back when we were doing the deal, it looked like a very good deal to us to make something happen. That part of town down there had been just sitting dormant. The city found a partner who was willing to take an area that nobody else had done anything with. It was an acceptable deal.

Ray Hunt has, on occasion, has referred to the so-called Master Agreement to assert his influence over what happens to the Reunion property. In 2005, he used it as a platform for his opposition to a possible casino on the property — saying that would not meet the land use requirements. Assistant City Manager Ramon Miguez says Hunt, and his Woodbine Development Corporation, DO have a say about what happens to the property, but Hunt does not have veto power.

Miguez: There is something in the Agreement that allows Woodbine to at least opine on how that property might be used.

Hunt, for example, might object to a project that would compete with his Hyatt Hotel, or Union Station events next door — which he controls per the 1974 agreement.

At City Hall: Councilmember Mitchell Rasansky - a real estate investor — says the agreement with Hunt will not present a major obstacle whatever the city decides.

Ransasky: I’ve looked over that. The right of first refusal, I’ve looked over that - we’re in the driver’s seat with that.

John Scovell, President of Ray Hunt’s Woodbine Development, says it would be premature to speculate on how the tract might be developed - who would own it, and who would build on it - until the city decides whether to sell.

Real Estate Consultant Marcus Wood says Reunion - one of the most valuable tracts in downtown Dallas , can only increase in value: which makes the decision about ownership so important.

Wood: Well, that’s the 64 million dollar question.

This fall, the Dallas City Council is expected to begin closed door discussions about what to do with the Reunion property.

Dallas real estate market is nation’s most stable - Says Joan Severson Plano TX Realtor

Dallas, Texas (WiredPRNews.com - Press Release) – The sluggish economy, weakening dollar and soaring oil prices have taken their toll on American in every aspect of their lives. One of the most notable markets that the economy has severely bruised is the real estate market leaving homebuyers scared to purchase, sellers with heaps of debt and unsold properties and Realtors worried about the future.

However, in a recent article published by the Dallas Business Journal, the housing market in the bustling city of Dallas Texas real estate is the strongest of any major city in the US .

The article states, “Home prices in Dallas have avoided the speculative bubble that rapidly drove so much of America ’s real estate to record prices and record unsold inventory levels. To this point, home prices in the Dallas area increased a steady 17% over the last five years, while the U.S. averaged an extreme 53.5% increase during the same time period, according to the Office of Federal Housing Enterprise Oversight.”

The Dallas Business Journal highlights many of the factors as to why Dallas has consistently exceeded the housing market in the rest of the country. These factors include economic stability indicators such as favorable zoning regulations and an ample land supply, a hearty job market with impressive income growth, and and ideal physical location, central to both U.S. coasts and Mexico.

Joan Severson, an experienced Dallas real estate specialist, realizes that the state of the economy is enough to scare homebuyers back into renting but invites them to take a look at the positive aspects of buying, selling or investing in Dallas due to the published report.

“Dallas’ land resources and prime location mixed with a healthy job market should be enough to remind buyers that this just the right time and place for your next home,” Severson explains. With 30 years of proven performance and customer satisfaction, Severson wants buyers to take advantage of the nations most stable real estate market and find the home of their dreams.

For more information on Joan Severson and and helpful tips and buyers’ resources, visit Dallas Real Estate Web site today!

Economists See Hope in Home Sales Figures

After months and months of painful data, economists said there is a sliver of sunshine in a housing report released Thursday.

The National Association of Realtors announced that June pending homes sales increased a stronger-than-expected 5.3 percent from the previous month, although sales remain more than 12 percent lower than year-ago levels.

Economists had been expecting the report to show a 1 percent drop. “While this indicator is volatile and affected to an unknown degree by foreclosures, it does suggest that conditions in the resale market for real estate may be stabilizing,” economists at Goldman Sachs said in a report.

How about you, Ian Shepherdson, chief U.S. economist at High Frequency Economics? (Emphasis is mine.)

This is the second upside surprise in three months, so it is [hard] to ignore. We’re guessing, though the numbers offer no [breakdown], that sales of foreclosed homes are driving activity. Sales rose everywhere but the biggest gains were in the south, up by 9.3%, and the west, up 4.6%, where foreclosures have been [highest]. We doubt sales of non-foreclosed homes are rising, given the recent rise in mortgage rates and continued price declines. [Still], anything which reduces inventory, whether of foreclosed [homes] or not, is a very welcome development. It does not fix the housing market, though, but it might be the beginning of the end of the crash.

Lincoln Alderman disagrees with real estate tax complaints
By Kevin Barlow

LINCOLN, IL — Lincoln Alderman Buzz Busby sent a message at Monday night’s City Council meeting to residents who complain about their real estate taxes.
Busby said he hears every year from constituents who believe real estate taxes in the city are too expensive.
“I disagree, though,” Busby said.
In other business, the council tabled action on selecting a bid for security updates to City Hall. The city is looking at upgrading security at the building by installing security cameras, extra locks and bulletproof windows.
The council’s grounds and buildings committee was expected to discuss the security upgrades at a meeting Monday, but it decided to postpone until more information could be gathered.
Busby said he wasn’t interested in raising taxes at this point, but he felt the residents of Lincoln should know that nearly half of the money the city receives from property taxes is used for state mandates, mostly in the form of pension fund contributions.
“Let’s say you pay $3,000 in taxes. A total of $378 of that goes to the city and $188 of that goes to the pension fund, which is mandated by the state. So, in actuality, the city would only get $190 of that money to use.
Busby said the Lincoln-Logan Park District receives the most benefit from tax money. The district receives $256 worth of taxes but only $18 goes to the pension fund, he estimated.
“So that leaves them with around $238 to use, and that is nearly $50 more than the city gets,” Busby said.
He also noted local school districts collect more than half of the property taxes, and the Heartland Community College district’s taxes just went up 14 percent.
“So when people say their city taxes are too high, well, I doubt it,” he said.
Lincoln Mayor Beth Davis-Kavelman agreed with Busby’s assessment.
“I agree and people just don’t realize where their tax dollars go,” she said. “I get approached about the taxes being too high as well.”