Mobile Eastern Shore Real Estate Podcast-August 2008

Changing home values and higher inventories have presented difficult challenges for distressed home sellers. Fortunately, many lenders are working with sellers by accepting Short Sales and avoiding foreclosure.  Listen to our Mobile Eastern Shore Real Estate Podcast as we discuss today’s Short Sale programs, and break down our own local market trends. Featured special guest is Terri Murphy of US Learning.

 

 

 

 

 

Short Sales Buzz In Mobile AL Real Estate

In the current Mobile AL real estate market, there has been a lot of buzz around “short sales.”  What is a short sale, exactly?  A short sale is when a lender agrees to accept a mortgage payoff amount less than what is owed in order to facilitate a sale of a property by a financially distressed owner – in essence, the lender forgives the outstanding balance of the loan.

 

There are pro’s and con’s to short sales on both sides of the deal.  For the seller, credit history is seriously damaged, but not as badly as it would be by foreclosure.  Sellers also walk away with no profit, which makes it difficult to purchase another home.  For the buyer, the property comes at a reduced price, but it also generally comes with its fair share of problems, and there is a considerable amount of “red tape” to get through to complete the purchase.

 

The short sale buying process can be a confusing one, especially for a first-time short sale buyer.  Check out this helpful article from BankRate.com and see 10 Steps for Short Sale Buying below:

 

  1. Identify potential short sales
  2. View the property
  3. Do your research
  4. Find all liens and mortgages
  5. Figure out the financing
  6. Contact the lender
  7. Complete the lender’s short sale application
  8. Assemble the proposal
  9. Negotiate
  10. Close the deal

 

To learn more about investing in Mobile AL real estate, please visit JudySells.com.  For more personalized service, please call us today at 251-990-0569. 

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Mobile AL Real Estate Sales Statistics: May-July 2008

The latest survey by the National Association of Realtors® shows existing-home sales rose from the first quarter in 13 states, largely from buyers responding to discounted home prices. Nearly one-quarter of metropolitan areas showed rising home prices in the second quarter from a year ago, with greatly mixed conditions continuing around the country.  

Let’s take a look at the latest Mobile AL real estate sales statistics from Trulia to see if Mobile AL home sales have increased. Trulia compared May-July 2008 sales with May-July 2007 sales:

Mobile AL Real Estate Sales Statistics, May-July Comparison

The number of Mobile AL homes that sold declined 25% during the May-July time period compared to the same period in 2007. The per square foot price decreased by $1.00 or 1%, while both the average and median prices declined 3%.

Average Sales Price 2008: $168,457
Average Sales Price 2007:  $173,403

Median Sales Price 2008:  $140,238
Median Sales Price 2007:  $145,000

Average Price Per Square Foot 2008:  $92.00
Average Price Per Square Foot 2007:  $93.00

Number of Sales 2008:  505
Number of Sales 2007:  675

What does this mean for Mobile AL home buyers and sellers? Buyers are continue to benefit from moderate prices. Add low interest rates to the moderate prices and the new tax credit for first-time buyers and now is an excellent time to buyer Mobile AL real estate.

With sales off 25% from a year ago, sellers will need to be competitively priced and in excellent condition to catch the eye of prospective buyers.

Interested in buying or selling Mobile AL real estate? Visit our website, JudySells, or give us a call for more personal service, 251-583-5923.

Search all Mobile AL real estate and homes for sale.

Also read:
How Does The Housing Recovery Act Help Mobile Home Buyers
7 Reasons To Own Your Own Mobile Home
Mobile Eastern Shore AL Real Estate Podcast
Mobile AL Real Estate Tip: Questions To Expect From Your Lender

Mobile AL Real Estate: Second-home Sellers Pay For Tax Credits

Mobile AL Second-home Sellers Pay For Tax Credits

You have probably heard, last week President signed into law the Housing Rescue and Foreclosure Prevention Act. This is the most comprehensive housing bill to be enacted in over a decade. The bill is designed to help more buyers of Mobile AL real estate realize their dreams, as well as, boast the struggling housing and mortgage markets.

One of the biggest benefits, and probably one of the most talked about provisions in this legislation, is the $7,500 tax credit to first time home buyers. Tax breaks are all well and good, but they have to be paid for somehow. While first time home buyers are getting a break, second home sellers will be paying for the $15.1 million dollars in tax cuts.

Up until the new legislation went into effect last week, homeowners could exclude up to $250,000 taxable profit on the sale of their home if they’re single taxpayers and $500,000 if married filing joint returns. The catch being, they had to live the in house as their primary residence for two of the five years before it is sold.

Many second home owners took advantage of this by moving into a property that was once a rental or vacation home, live there for two years prior to selling and benefiting from the tax-free profit.

With the new legislation, owners selling on or after January 1, 2009 will have to factor out the period when the property was still a rental or vacation home and pay taxes on that portion of the profit.

 

Here’s an example courtesy of BankRate.com:

Jim and Joan are in their 50s and next January buy a vacation home for $200,000. Ten years later, they retire, sell their old principal residence and make the vacation home their new principal residence. Fifteen years after that, Jim and Joan, now in their 80s, move to an assisted-living community and sell the vacation-turned-primary-residence for $700,000. That nets them a gain of $500,000.

Under pre-housing bill statute, Jim and Joan wouldn’t face any tax on the entire $500,000 gain.

The new law, however, means that Jim and Joan can exclude only 15/25, or 60 percent, of the gain. That would give them $300,000 of nontaxable property sale profit and $200,000 upon which they would owe long-term gain taxes.

As you can see, the new legislation significantly affects second home owners and their retirement strategies. The second home market has remained strong in the last few years, but this may change dramatically in the near future….something congress may not have intended.

If you own Mobile AL real estate and are in the middle of converting your second home to your main residence, you could be out of luck. If you don’t have enough time left in 2008 to meet the two year lived-in rule and sell the property, when you do sell next year, you will pay.

If you need to sell your Mobile AL home before January 1, 2009, give us a call at 251-990-0569. We will help you get the highest price for your Mobile AL real estate before the end of the year!

Get the current market value of your Mobile AL home.

 

How To Sell Your Eastern Shore & Mobile AL Real Estate – In a Hurry!

If you have been trying to sell your Eastern Shore and Mobile AL real estate recently, you probably have realized that this is not the ideal time to try to sell a house.  With a struggling economy and negative media surrounding the housing market, homes are staying on the market for longer and longer as fewer buyers are making offers on them.  So – what do you do if you find yourself in a situation that requires you to sell your home in a hurry?  The Wall Street Journal offers the following tips that I hope you’ll find helpful:

1. DON’T WAIT AROUND.
Even in the better housing areas, it’s taking a long time to sell houses; so, don’t try to sit out the market. That’s what hundreds of other timid sellers are doing, each of them hoping — somehow, some way — that hanging on the sidelines will improve prices and, ultimately improve the chances of a successful sale. It won’t. If you want your place sold, the best way to make sure that happens is to put it up for sale.

2. FIX IT UP AND CLEAN IT UP.
Buyers are taking your house out on a date. It has to make a good impression. You don’t have to (and shouldn’t!) spend a lot of money, but ensure everything is in good working order.  As you get closer to the date that the house is actually on the market, start moving out by decluttering – buyers don’t want to see a house filled to the rafters with other people’s things.

3. PRICE IT CHEAPLY.
Don’t fight the market by trying to price your house at bubble-era levels or by factoring in all those improvements you made.  In today’s market, your best bet is to set a realistic, salable price on day one. Don’t let the house hang around on the market as you gradually lower the price. Forget what you think the house should be worth or what it was worth three years ago. That’s not what it’s worth today.

4. HIRE A TOP REAL-ESTATE AGENT.
Get the best listing agent you can find.  When everything was selling before it even hit the market, of course, you didn’t need the best.  Sellers of higher-end properties may be able to negotiate a lower commission percentage, but this is no time to quibble over a couple of percentage points. Also, offer the agent a big bonus if he or she sells the house in 30 days or at your asking price. Offer other agents bonuses if they bring in the ultimate buyer.

5. PROMOTE. PROMOTE. PROMOTE.
The agent should pay the usual marketing costs, but you should be prepared to pony up for extras, especially if you insist on more expensive or untraditional promotions. Make sure your house is on the leading real-estate Web sites; Trulia, Zillow, Cyberhomes, Eppraisal and Realtor.com are some of the top ones. Beyond that, get really creative. Advertise in corporate newsletters and intranet listings. Check in with local relocation firms that help transferring corporate executives find new homes. List the house on eBay. Put it on Craigslist. Put it in your church bulletin.

6. PLAY THE BANKER.
As bad as things are, there’s one big factor in your favor: the tight credit market. If you have no mortgage you have to pay off, your strongest selling point might be your ability to finance all or a substantial part of a buyer’s purchase. You’re a lot more flexible than a bank that has the Federal Reserve looking over its shoulders, so you might even be able to charge a higher interest rate than a commercial lender as well as command a higher sale price.

7. TAKE THE OFFER.
If any qualified buyer comes in with a reasonable offer, be prepared to accept it. Negotiate, of course, but recognize that the buyer has a lot more clout than you do. Your house, as wonderful as you think it is, is worth only as much as someone is willing to pay for it. 

If you are considering selling your Eastern Shore or Mobile AL real estate, let my experience work for you!  Please call me at 251-990-0569, visit JudySells.com.

Get the current market value of your Moible AL home.

7 Reasons To Own Your Own Mobile Home

You’ve probably seen lots of financial arguments about why you should invest in Mobile real estate and own your own home rather than rent. This includes budgeting (no rent increases) and the tax savings you’ll most likely have. Now we’re going to give you some reasons you probably haven’t heard.

1. Freedom to pursue other goals in life once the major goal of home ownership is achieved.

Strange as it sounds, many of our first-time buyers have told us that once they bought the house, other things in their life started to fall into place. It’s as if not owning took so much of their mental energy that other goals were not worked on until that big goal was reached. So buy a home and get on with your life!

2. A greater sense of belonging to the community.

Once you own a home, you feel more attached to the city in which you live. You’re more interested in what happens in Mobile, to the roads, schools, and shopping areas. Some people even become involved in local politics.

3. A commitment to something, a sense of stability.

Home ownership is an anchor, something that cannot be pulled out from under you. You’ll never get a notice that you have to move. You’re kids will never have to change schools. It gives you freedom to plan years ahead.

4. You can change things, a feeling of being in control.

It’s your home. You can add to it, remodel it, change the landscaping, do whatever projects you want. You have a feeling of being in control of something in your life. At work we don’t always have control of what happens, but your home is your castle and you have dominion over it. You can see what you’re building take shape before your eyes.

5. More control over the children than in an apartment complex

In a neighborhood, kids usually play in the yards or go to friend’s houses a few doors away. Our clients have told us that in an apartment complex they never knew where the kids were. They could be in any of hundreds of apartments, doing who knows what. In a home you get to know the neighbors and watch out for each other’s kids.

6. Children do better in school and feel more secure.

This one surprised us, but buyers have reported to us that their kids calmed down in school after they bought a house. We don’t know why, but it seems to work that way. We remember a single mom watching her son play in the yard, making steps in the slope and building things. She didn’t have to tell him to leave everything alone, like she did at the apartment complex. I guess kids feel the same need for control we adults do.

7. Time and money saved by not going to the Laundromat.

A small point, but if you have kids, you know the value of this one. You gain a whole evening a week when you buy a house! The wash gets done in between other things, or while you’re at work. What would you do with the extra evening you’ll have? How about going out for dessert with your spouse with all those quarters?

We’ve been in a home of our own for so long; we take these benefits for granted. We forgot what it’s like to be renters! If you have anything you can add to the list, please let us know via email. We would love to hear from you!

 

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Eastern Shore of Mobile Bay AL Real Estate: Is Renting Your Vacation Home For You?

One of the biggest decision Eastern Shore of Mobile Bay AL second-home buyers must decide is whether or not to rent their property when they are not using it. According to the U.S. Census Bureau, one-half of all second-home owners leave their home unoccupied for more than 330 days a year. The question becomes, will your vacation home be a financial burden or a financial cow with the rental income is can generate, thus paying for itself

Renting does have its pros and cons. Some owners don’t like the idea of ‘strangers’ in their home. Others don’t want the hassle of being a landlord, especially a long distance landlord. And then there is the decision to give up the prime vacation season for rental income. The flip side is renting your vacation home provides a stream of easy money.

EscapeHomes.com offers advice and tips when considering an Eastern Shore of Mobile Bay AL vacation home purchase and deciding whether renting out that home is right for you:

Before You Buy
If you already know you will rent your vacation home, consider these questions as you look at properties:

Is there a rental market in the area?
What is the average rent that your neighbors receive?
If you are looking in a development, are there any by-laws which restrict your rental capabilities?
Is this a seasonal area or year-round location?

The answers to these questions will help you select a more lucrative property for your vacation home.

Rental Seasons
How do you decide when to rent your property and when to use it yourself? Since you are buying primarily for your own fun and enjoyment, you shouldn’t sacrifice this. If the home is in a one-season area, for example, summers at the Maine coast, then giving up that time of year for rental income defeats the purpose of having the home. In this case, you might look for a long-term (9-month) renter for the off-season, among the local population, while you use it in the summer. On the other hand, if you buy a winter ski condo or chalet, it is still highly rentable in the summer time for the mountaineering types. If you buy a property for weekend use, perhaps there are local people who need a Monday-Friday escape option. In short, if you balance your own needs with the market demands, you get both fun and money.

Practical Considerations
For successful renting, first find out the going rental market rate. Second, determine if you want to market it yourself, or use a rental agent. Self-marketing takes time, but often generates more qualified renters as you are not competing with all the other properties of an agent. Third, be sure to arrange for a property manager. This is different from a rental agency. The manager will take 10 to 20 percent of the rent, and free you up from cleaning, being on call for maintenance (especially important if you live far away), and dealing with the daily needs of the renters.

Make it Personal
By far, the most important factor in success is your personal investment in the process. This means your personal contact with your renters. From a simple welcome note and local maps to a thank-you note and on-going contact, your relationship creates a repeat flow of guests who not only love your second home as much as you do but also pay for the privilege of using it. What could be better?

If you are considering buying a second home in Eastern Shore of Mobile Bay AL, give us a call, 251-990-0569, we are glad to provide you with the information you need to make a good buying and renting decision.

Think you want to rent out your Eastern Shore of Mobile Bay AL vacation home, but don’t want to handle the day-to-day details yourself, we can recommend an Eastern Shore of Mobile Bay AL Property Manager.

Search all Eastern Shore of Mobile Bay AL vacation homes for sale.

How Does The Housing Recovery Act Help Mobile Home Buyers

President Bush signed into law this week The Housing and Economic Recovery Act. This is the most sweeping change to housing reform since the New Deal of 1934. It is designed to assist more Americans invest in home ownership and shore up the faltering housing and mortgage markets. Like any legislation, it comes with the good and the bad. I encourage you to write your Congressmen to see if we can get legislation to revoke some of the bad.  For example, effective October 1, 2008, FHA will increase the minimum required down payment from 3% to 3.5% for Mobile home buyers. The legislation also calls for the elimination of seller down-payment assistance programs such as AmeriDream and Nehemiah by October 1, 2008.

As of July 14, 2008, upfront MIP premiums became risk-based on credit scores and the annual premium increased across the board. Instead of the original plan of making FHA loans more affordable for potential Mobile home buyers; the new legislation is doing the exact opposite and makes it more expensive.

Details of the Housing and Economic Recovery Act:

Here are some key provisions of the Housing and Economic Recovery Act that most affect Mobile home buyers:

  • GSE Reform – including a strong independent regulator, and permanent conforming loan limits up to the greater of $417,000 or 115% local area median home price, capped at $625,500. The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).
    View 2009 FHA and GSE loan limit estimates (PDF)

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Eastern Shore & Mobile Real Estate Update

Most of you are asking, “What’s happening in the Mobile real estate market?” Listings are selling, but at a slower pace. Prices seem to be adjusting, but not as low as the media presents to the public. Yes, we do have foreclosures and short sales, but a very small number. Today is a great day for a qualified buyer to purchase MObile real estate. The biggest problem with today is having qualified buyers.

What do we project for the future? I think this market will continue as it is until the beginning of 2009. The election will play heavily on people’s minds. Until the President is elected regardless of the outcome, sales will continue to lag at a slower pace. People always need houses and houses always sell. As one of you stated, now I know how it feels to be a bridesmaid and never the bride. Unfortunately, with so many homes on the market, it will take the perfect fit. Sometimes that fit is quick, and sometimes it takes many days.

Below, you will find an updated comparison of home sales in Spanish Fort, Daphne, Fairhope and Pt Clear, from 2007 and 2008. We are approximately 30% below the number of homes closed in 2007, but look at % to list, only 1% less. The average days on the market is not out of line from 2007. Overall, sales are down, but prices are remaining in line. Listening to the media, I was pleasantly surprised at our market.

2008
Homes Sold:  410
Days On Market: 165
% to List Price: 96%

2007
Homes Sold:  591
Days On Market:  144
% to List Price:  97%

As you know, if you have questions, please call me at 583-5923, or e-mail me at Judy@JudySells.com

Search all Eastern Shore and Mobile real estate and homes for sale.

Mobile Eastern Shore AL Real Estate Podcast

This month’s edition covers Mobile Eastern Shore AL real estate market activity and then we’ll discuss the new changes in FHA lending.

Features special guest Terri Murphy of US Learning.

Program length: approximately 7 minutes

download podcast mp3 file | subscribe to podcast feed

To learn more about the current Mobile Eastern Shore AL real estate market, please call me at 866-560-7474 or visit JudySells.com.