Archive for the ‘Information for Sellers’ Category

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March Into the Selling Season

Welcome to spring, the most anticipated season in the real estate calendar!  March brings a great selection of homes to the market, along with buyers eager to explore the spring listings.  In comparison to the last five years, this year is expected to produce a new sense of optimism in the real estate market.

Learn to Let Go

Do you know someone who is a bit of a hoarder?  Or do you yourself have trouble parting with belongings doing little more than occupying space?  Here are some strategies to help make letting go a little easier.

A Guide for Sellers

A property that doesn’t generate as much interest and sell as quickly as expected isn’t necessarily one that’s flawed.  There are several reasons why perfectly good homes linger on the market.  Here are some of the most common.

A Guide for Buyers

Spring’s here, which means the real estate market is in high gear!  Don’t run the risk of losing your dream home to a competing buyer by inadvertently disrespecting the seller.  Please take a moment to consider these points.

The Eyesore Next Door

When it’s time to sell your house, your street’s appeal can be just as important as your home’s.  Unfortunately, living next to (or near) that house can be another obstacle on the way to a sale.  What can you do?

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Beat The Rush

Thinking about putting your home on the market this year? If so, you’ll want to start gathering information and getting market updates now.  The right buyer for your home may already be looking, so if you’re ready to sell now, let’s talk.

Sizing it Right

Rooms that are shy on square footage can present a decorating challenge for homeowners, as can rooms that have square footage to spare.  Here are some suggestions to help you solve either dilemma.

Buying or Just Looking?

Pricing your home competitively is the key to getting it off the market sooner — as is not wasting time and energy on the wrong kind of buyer.  So who is the right kind of buyer?

Fear of Commitment

Even seasoned homebuyers can sometimes find themselves suffering a case of cold feet after signing an offer to purchase a home.  Here are some strategies to help you cope with buyer’s nerves.

Projects for the Pros

Everyone likes to save a few bucks, but when it comes to home repair and renovation, it doesn’t always pay to take the do it yourself approach.  below are five projects best left to the professionals.

Read this month’s newsletter here.

By Tim McLaughlin, Senior Vice President, Weichert Financial

Now that the dust has settled on the Fed’s directive announced last Wednesday in their statement, we want to reiterate several themes. Without a doubt, this is an uber-dovish statement from the Fed.

First, the extended period language was moved out significantly with the first rate hike targeted for late 2014 or later. Granted, this could be pulled back closer over time, but this is the projection as of today.

Second, Bernanke made it clear that the guidance sentence, which is decided by the FOMC voters, dominates the projections, which comes from the whole committee. In other words, the alternate projections, which reference potential hikes in 2012 and/or 2013, should be discounted, as they are dominated by non-voting hawks.

Third, the FOMC has quietly raised its inflation target. Just five years ago the discussion was about a 1 to 2% range, and then it moved to 1 1/2 to 2%, then 1.7 to 2% and now simply 2%. Clearly the Fed is worried about running a low target because it means that during recessions there is a greater risk of either going into deflation or hitting the zero lower bound on interest rates. Hence, create a bigger cushion gives more room for fluctuation.

Fourth, the Fed has implicitly changed the weights in its “Taylor Rule”. By law the Fed is supposed to put equal weight on unemployment and inflation, but since Volcker came in the implicit sense was that inflation had a bit more weight. This does not mean the Fed has given up on controlling inflation, but, rather, it does mean on the margin they accept bigger cyclical swings in inflation.

Takeaways:

All of this suggests:
(1) The first rate hike will come even later
(2) Even stronger odds of QE3 (focused on MBS given Fed’s focus on housing) after the “Twist” is over and if growth weakens as most expect
(3) Somewhat higher inflation and inflation expectations
(4) More inflation volatility
(5) Accommodations to support the broader economy, lending (and housing as a bi-product) and investment (corporate and otherwise).

All in all, more positive news to support the market in 2012.

by Tim McLaughlin, Senior Vice President, Weichert Financial

Mortgage applications increased 23.1% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Jan. 13. The data includes an adjustment for New Year’s Day. The MBA market composite index increased 23.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index increased 38.1% compared with the previous week.
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Fewer Americans than forecast filed first time applications for unemployment benefits last week, easing concern that post-holiday firings were on the rise.
Claims plunged by 50,000 to 352,000 in the week ended Jan.14, the lowest level since April 2008, Labor Department figures showed today in Washington. The median forecast of 41 economists in a Bloomberg News survey projected 384,000. The four-week average, which smoothes out fluctuations, decreased to 379,000 last week from 382,500.
Companies are slowing the pace of firings and beginning to step up the pace of hiring even as a slump in Europe spurred by a default crisis may limit U.S. growth. The improvement may be a sign that companies are looking to expand their workforces as sales climb.
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Oil demand is falling for the first time since the 2008-2009 global financial crisis as a result of a mild winter, high crude prices and the European economic crisis, according to fresh estimates from the International Energy Agency. The industrialized nations’ watchdog said oil demand dropped by 300,000 barrels a day in the final quarter of 2011. Such a fall is rare: over the last decade, oil demand has posted drops only in the financial crisis of mid-2008 to mid-2009. The end game on the supply/demand curve is as demand falls, so, too, should prices.
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The spring market is around the corner…we can help!

by Tim McLaughlin, Senior Vice President, Weichert Financial

With the Republican Primaries well underway, we analyze some of the candidate’s platforms on two of the topics that will drive our industry over the course of the next four years: the economy and housing.

The Economy:

Romney: A proponent of lower taxes, less regulation, and a balanced budget. Proposes the repeal of Dodd-Frank, a law toughening financial industry regulations after the meltdown in that sector. Proposes changing, but not repealing, Sarbanes-Oxley, a law tightening accounting regulations in response to corporate scandals, to ease the accountability burden on smaller businesses.

Santorum: Spur jobs by eliminating corporate taxes for manufacturers, drill for more oil and gas, and slash regulations. Repeal every Obama-era regulation that costs business more than $100 million a year.

Huntsman: End corporate subsidies, cut regulations, lower taxes, spur jobs through energy development; seek repeal of President Barack Obama’s health care law. Break up megabanks as a hedge against future bailouts of the industry.

Gingrich: Repeal the 2010 financial industry and consumer protection regulations that followed the Wall Street meltdown, and repeal the 2002 regulations enacted in response to the Enron and other corporate and accounting scandals. Restrict the Fed’s power to set interest rates artificially low.

Perry: Spur economy by repealing rafts of regulations, Obama’s health care law and Dodd-Frank toughening financial-industry regulations after the meltdown in that sector. Create jobs in energy sector by removing obstacles to drilling and production. Cut corporate taxes.

Paul: Return to the gold standard, eliminate the Federal Reserve, let gold and silver be used as legal tender, eliminate most federal regulations.

Housing: Sadly, the silence has been deafening regarding the candidates stance on housing and their plan to revive the sector. A couple of quotes are as follows:

Romney: “Don’t try to stop the foreclosure process. Let it run its course and hit the bottom. Allow investors to buy homes, put renters in them, fix the homes up and let it turn around and come back up.”

Perry: “Immediate remedy for housing is to get America working again. Creating jobs will address the housing concerns that are impacting communities throughout America.”

by Tim McLauglin, Sr. Vice President, Weichert Financial

Whether you are on the verge of purchasing a home that you love but that you know you will most likely want to remodel a bit, or you want to make some changes to that existing home, here are the five most common remodeling mistakes:

Setting an unrealistic budget

Most homeowners underestimate their budget by at least 25 percent. As you can imagine, not having enough money to complete a project can not only stress you out, but can also force you to live with a half-finished project for a lot longer than you expected. Most experts suggest calculating your budget and then increasing it by 20 percent for safety (and sanity) sake.

“Keeping up with the Joneses”

One of the biggest mistakes I’ve read about is remodeling or redesigning a space for what’s most popular at this minute. The more trendy the project, the more likely it will feel out-of-date in a few years. That’s not to say you shouldn’t update your home to match your style and interests, but if you’re looking to sell in the near future, do not get hung up on trends.

Over-improving

A lot of the time, homeowners invest in remodeling their home hoping that when they do sell, they will be able to maximize their ROI. However, they fail to consider the quality and state of the homes in their neighborhood. Say you invest in top-of-the-line products, but the rest of the homes in the neighborhood are modest and average, then you run the risk of having an even more difficult time selling the home or getting the money back.

Doing it Yourself

In order to keep budgets low or reduce the costs of some projects, many homeowners think they can tackle big projects themselves. This is usually a HUGE mistake. Unless you have the right tools, training and connections, you could actually cause more problems down the line, including doubling your budget when you have to call a professional to come in and fix your mistakes.

Financing

Whether this is a new home that you want to renovate upon closing or an existing home, the biggest mistake you can make is not using Weichert Financial Services for your funding needs. On a refinance, we can offer you historically low rates on a cash out refinance to fund the initiative. On a purchase, talk to your knowledgeable Weichert Financial Gold Services Manager regarding putting less down and/or financing the closing costs to have more liquid assets for the renovations. Ask us how…we can help!

By Tim McLaughlin, Senior Vice President, Weichert Financial

As we enter 2012, here are some money saving tips specifically related to the housing sector to help you manage your financial budget and capitalize on savings.

Buying a home: What size is right?

According to a survey by the National Association of Realtors, home construction firms expect U.S. houses to average 2,152 square feet in 2015, down 10% from last year. This means that if you’re buying with the goal of selling it in the future, trends suggest that oversized homes may be a declining trend in the future. So an astute buyer needs to decide what size home is right for them.

Selling a home: What price is right?

According to Joe Magdziarz, president of the Appraisal Institute, sellers and their agents should look at comparable sales data just within the past 90 days to find the right price. You don’t want to be one of the 75% of homeowners who believe their home is worth more than it is. Your knowledgeable Weichert Realtor can help you assess what price point the market will dictate to help sell your home.

Already a home owner: Shorten your loan

Refinancing your mortgage to a shorter term can save you significantly. For instance, a $250,000 mortgage, going from a 30 year at 4.25% to a 15 year at a 3.50% would save you $12,000 in interest over the life of the loan (assuming full term duration).

Don’t want to do a 15 or 30 year term loan? Terms of 10, 20, and 25 years are also available. Your educated Weichert Financial Gold Services Manager can help you custom fit the term that works best for you.

Already a home owner: Refinance, Refinance, Refinance

Even if you don’t think you have enough equity (or any equity) in your existing property, there are new product offerings coming on the market each day, so where you may have gotten a “no” in the past, you may be able to get a “yes” today or in the near future. Additionally, there are options to do a cash-in refinance, where you bring some cash to closing. If disposable cash is an issue, there are also options to build closing costs into the structure to come to the table with little or no cash in many cases.

Have questions? Need help analyzing what is best for you? Ask us….we can help!

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Who Needs an Agent?

According to the National Association of Realtors, 85 percent of homeowners are assisted by a real estate agent when selling their home, while 79 percent of buyers purchase their home through a real estate agent or broker.  Most buyers and sellers know they need help with their real estate transactions, and here’s why.

Sweet Dreams

Most of us are sleep deprived and overstressed.  If you consider yourself to be among the majority, here are some words of advice on how to turn your bedroom into an oasis of relaxation and get a better night’s sleep.

Showing Success

Your home is on the market and generating buyer interest.  Congratulations!  Now keep that success rolling by avoiding these critical mistakes some sellers make when showing their homes.

Ready for Seconds

Are you thinking about buying your second home?  Or your third, fourth or even fifth property?  Here are a few signs that you’re ready to make the move to a new address.

Save Your Energy

Lessening your impact on environmental damage is an admirable thing to do, but let’s face it — there’s no better incentive for making your house more energy efficient than saving money every month.  Here’s how to do just that.

Read this month’s newsletter here.

By Tim McLaughlin, Senior Vice President, Weichert Financial

It seems like each week, the markets have a new focus on a different country that drives volatility; this week the focus is on Italy. Take a look at the week that was: Global Equity markets all rose (and Fixed Income rates sold off) Tuesday when Silvio Berlusconi agreed to resign as Italy’s Prime Minister. That’s because a lot of people think Berlusconi is the reason Italy is teetering on the edge of financial disaster. Wednesday, Equity markets were down because those same people realized that they were wrong. Thursday, another rally as maybe they were right.

The idea was that without Berlusconi, the Italian government will get its fiscal house in order and be able to pay back all the money it has borrowed. Italy depends on borrowed money to service its debt, which is significant, but not huge like that of either Greece or the US. In fact, the nation’s fiscal deficits have actually been lower than what they were projected to be.
So with that said why is the US concerned with Italy? As the International Monetary Fund reports, the problem is a “mounting concern among investors about the two way relationship between sovereign and financial risks, and about prospects for policymakers to craft a convincing and durable crisis resolution framework in the euro area. Without significant progress, there is a risk that market worries could become self-fulfilling, with consequences that could prove difficult to contain”.

In simpler terms, the fear is that the government can’t deal with the deficit. More than anything else, that worry is driving up the cost of borrowing money to service the debt. Despite the news about Berlusconi, on midday Wednesday, Italy’s 10 year bonds were at 7.68% and 2 year notes were yielding 7.10%. The magic number here is 7%. When bond yields for Greece, Portugal and Ireland hit 7%, they all had to call on the European Central Bank and the IMF to bail them out.

But unlike the other three nations, Italy has a huge economy. It is Europe’s third largest, trailing only Germany and France. This has enabled it to borrow a lot of money from other people. As of March non-Italians held $1.1 trillion in Italian bonds. This is more than the combined total of foreign-held bonds for Ireland, Portugal, and Greece. So even with the help of the ECB and the IMF, they probably aren’t going to be able to save Italy by themselves.

So why is this concerning to the US? US banks increased sales of insurance against credit losses to holders of Greek, Portuguese, Irish, Spanish and Italian debt in the first half of 2011, boosting the risk of payouts in the event of defaults. According to the Bank for International Settlement, guarantees provided by US lenders on government, bank and corporate debt to those countries rose by $80.7 billion to $518 billion. Almost all of that was CDS. If Italy defaults, or even just looks like it is in danger of defaulting, institutions are going to want to make sure that the loan guarantors can pay off. The fear is what if the US banks can’t?

by Tim McLaughlin, Senior Vice President, Weichert Financial

On Wednesday, Federal Reserve policy makers raised their assessment of the economy while saying “significant downside risks” remain and refrained from taking any additional steps to ease monetary policy.

“Economic growth strengthened somewhat in the third quarter, reflecting in part a reversal of the temporary factors that had weighed on growth earlier in the year,” the Federal Open Market Committee stated after a two day meeting. At the same time, it repeated that “there are significant downside risks to the economic outlook, including strains in global financial markets.”

The statement may reflect the desire of policy makers led by Chairman Ben Bernanke to see if the unconventional policy steps unveiled at their last two meetings help the expansion gain strength before embarking on new initiatives. While the economy grew last quarter at the fastest pace in a year, that is still insufficient to push down the unemployment rate, and officials have said the U.S. remains vulnerable to shocks from the European debt crisis.

The Fed left unchanged its pledge to keep the benchmark interest rate near zero through at least mid-2013 as long as unemployment remains high and the inflation outlook stays “subdued.” The central bank has kept the target federal funds rate in a range of zero to 0.25 percent since December 2008.
“The committee will continue to assess the economic outlook in light of incoming information and is prepared to employ its tools to promote a stronger economic recovery in a context of price stability,” the statement said.

The central bank also said it would continue its plan to purchase $400 billion of longer-term U.S. bonds by June 2012 while selling the same amount of short-term debt, a program known as Operation Twist. It also will continue reinvesting proceeds from housing debt into mortgage backed securities.

From a market perspective, investors viewed this as a “no change/stay the course” announcement, and all eyes in the mortgage sector continue to focus on the events in Greece/Europe, and on the impending HARP 2.0 release.

Secondary Marketing Takeaways: In terms of employment data, a mostly positive release for the economy this morning. Nonfarm Payroll numbers for the month were the only minor negative in the report (80K vs. projected 95K), however, last month was revised upwards 55K (from 103K to 158K). Additionally, the Unemployment Rate dropped to 9.0% from 9.1%, while Fed Chairman Ben Bernanke commented on Wednesday that we could be in the mid 8% range by 2Q12.

With only eight weeks left until the end of the year, the major market focuses for the mortgage sector are:

1) The resolution of the Greece debt crisis
2) The implementation of HARP 2.0 in December
3) If a broader MBS purchase program by the Fed comes to fruition in the coming months.