Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.

Over half – 51 percent – of self-described “working class” home owners as well as younger non-college graduates (51 percent), African Americans (57 percent) and Hispanics (50 percent) who currently own their homes reported that a 20 percent down payment would have prevented them from becoming home owners.

Pulse surveys for the past eight years have consistently reported that having enough money for a down payment and closing costs are top obstacles that make housing unaffordable for Americans. Eighty-two percent of respondents cited these as the top obstacle, followed by having confidence in one’s job security.

The survey also found respondents were adamantly against eliminating the mortgage interest deduction. Two-thirds of Americans oppose eliminating the tax benefit, while 73 percent believe eliminating the MID will have a negative impact on the housing market as well as the overall economy.

When asked why home ownership matters to them, respondents cited stability and safety as the top reason. Long-term economic reasons such as building equity followed closely behind. On a local level, respondents said neighbors falling behind on their mortgages and the drop in home values were top concerns. Foreclosures also continue to remain a large concern, with almost half of those surveyed citing the issue as a problem in their area.

Courtesy of National Association of Realtors. For complete article, click here.

I was introduced to the site trendwatching.com by recommendation of a colleague, which gave it credibility in my mind and increased my interest in reading it. So, too, can happen with many of our purchasing decisions as those around us play a role in what we consume. This month’s briefing on trendwatching.com gives a name to those influencers: “F-Factors” (Friends, Fans & Followers). 

Today let’s delve into some of the ways that this “F-Factor” Network can influence consumers to buy: 

1. Discovery – friends, fans and followers are influencers and give credibility to a brand.
2. Rated – Since everyone is so busy, and so many ads come at us every day, targeted and personalized recommendations will be more likely to get a consumer’s attention. There is a lot of this integration going on with Facebook right now.
3. Feedback – trusted recommendations and testimonials are influential in how people will purchase.
4. Together – a multitude of tools now allow users to share and coordinate purchases with others, even when not physically shopping together.
5. Me – websites and apps that takes users’ social media content, accumulating it in one place, to provide the most relevant information in a short amount of time. 

What does this mean for real estate?

Research has shown that more than 80% of homebuyers search the internet first for a home. To reach future buyers, it is important to understand how real estate buyers are influenced. Friends, fans, followers, those in a closer circle have a strong influence over purchasing decisions. Buyers are looking for the home that they will find most exceptional and that will also be validated by their sphere of influence. Here are two ideas I have for you today about reaching the “F-Factor”: 

• Online presence. Have you made it easy for buyers to share information about your community with their friends? Integrate your website with your social media campaign. Through the use of Facebook “Like”Buttons and Four Square “Check-Ins” interested buyers can go public, quickly letting friends know of their interest.
• Resident referrals. Last night, I met a 2 year resident of one of our properties at an art event. He greatly enjoys the location and the value of his home and was more than willing to share the reasons with others. Find ways to let referrals speak through your residents to their “F-Factors”.

Understanding the F-Factor is about being exceptional so that consumers will find and choose you. What are you doing to be exceptional to influence the F-Factor?

Housing Watch recently posted an article stating “from a recent survey, the home ownership dream is in decline.” Forty-nine percent out of the 2,000 persons surveyed believe they will never be able to have a down payment for a home.

As an eternal optimist, I believe that the American Dream of homeownership is still alive and well!  A market in flux is gradually coming to an end and we are once again entering a market of opportunity.  The market is back to a more “traditional” pace of growth and absorption, a far cry from the free fall we recently experience and much more stable than the artificial levels of 2004 and 2005.

According to the NAHB, “Even though the homebuyer tax credit expired on April 30, 2010 and won’t be renewed, there may never be a better time to buy a home than today.”  Most buyers can take advantage of today’s competitive prices and get a home they may not have been able to purchase just a few years ago.

Loan programs are still available to offer affordable down payments through FHA, down payment assistance programs and grants.  The main objective to qualify for the different loan programs to assistance with a down payment is good credit.

Yes, the American Dream of homeownership is still alive and well!

With only 2 more months to take advantage of the $8,000 federal tax credit, those of you who are first time homebuyers are eager to utilize the government’s money and capitalize on the great offers in the real estate market. 

 However, buying your first home can be very overwhelming and confusing, especially in a market in which location, location, location is no longer the iconic slogan of the real estate industry – it’s now best deal, best deal, best deal, which broadens your search tremendously, making your decision even more overwhelming.   Buyer incentives are everywhere, and the comparable search is no longer simply comparable. 

To all of you first time homebuyers, as you spend your time searching for your perfect first home, it behooves you to work with an agent that has your best interest at heart.  He / she will help educate you to make a decision that is right for you, your pocketbook, and your lifestyle.  Your real estate agent will first instruct you to get pre-approved by a reputable lender prior to beginning your home search.  The pre-approval process will help you narrow your search by limiting the price point you can afford.  Narrowing your search to be based on price will be one step to a more simplified buying process.

An agent will not only guide you in finding your home, but will also be able to help you through the stressful contract negotiations and explain all of the underlying costs of a new home purchase.  And, as you’re choosing your new home, your agent will also help you determine if the house is not just the right house for you, but if it is also the right investment for you.

 Above are just a few of the reasons why it is imperative that a first time homebuyer work with a trusted and knowledgeable real estate.  Agents are authorized to act on your behalf and to limit the stress so you can enjoy the excitement of your first home!

In my previous post To Extend Or Not To Extend, I blogged about my belief that the government should extend the first-time homebuyer tax credit. Not only was I listened to, but Americans were also given an expanded credit for those living in a primary residence for more than 5 years. Well, just this past week, I sold my condo (a primary residence of over 5 years) to a first-time home buyer. And how did I do that in this economy, you ask? After doing a thorough analysis of active and sold listings in the market and looking to the success CBNRTDA is having at our on-site communities, I did the following:

• Energy-priced the home so that I was competitive with the market

• Offered an agent incentive (an additional 1% commission)

• Staged the condo so that it always looked like a model home; I even incorporated sound for showings

• Used the extensive internet exposure offered by Coldwell Banker and also invested in regular e-blasts with various messages for the market

• Reached out to local brokers

• Regularly followed-up with prospective buyers

What did I learn from selling my resale condominium in this market? That the tried and true methods CBNRTDA uses each day at our on-site communities are very effective. When I used these same methods, I generating qualified traffic and got the sale. These days, it is a combination of price, exposure and prospecting to go from listing to SOLD!

The expected changes are as follows:

1. Increase the mortgage insurance premium, which is collected at closing and most often financed with the loan from 1.75% to 2.25% of the loan amount.
2. Require that any borrower with a credit score less than 580 put down 10%.  3.5% down will continue to be required by HUD with credit scores equal to and greater than 580.
3. Seller concessions will be limited to 3% of the purchase price verses the current 6% limit.

FHA is a federal assistance mortgage loan in the United States insured by the Federal Housing Administration that is issued by federally qualified lenders. Benefits include:

 - Lower down payment than conventional financing – only a 3.5% down payment required

 - More forgiving credit standards

 - Gift funds are allowed for closing costs and down payment

 - Seller concessions are available up to 6%

 - Asset reserves are not required at closing

 - The maximum loan limit is $346,250 for the Atlanta area

 - There are multiple loan limits, including 15-, 20-, 25- and 30-year loans

The USDA Guaranteed Rural Development Loans program (Rural Housing) offers attractive terms for eligible buyers purchasing eligible rural properties. We can help you determine if your buyers can take advantage of these program benefits, such as:

 - No mortgage insurance (PMI)

 - 100% financing

 - Loans are available up to $417,000

 - Non-traditional credit is even allowed in some circumstances

 - And asset reserves are not required

There are different guidelines for each loan type, dependent upon product type, condition of the house and the buyer’s circumstances. Speak to your mortgage counselor about your specific needs to determine if either of these loan types are an option for you. You can also visit www.hud.gov for additional information about FHA loans and www.rurdev.usda.gov for additional details about Rural Housing loans.

“Types of loans avialbe for REO homes” is part of NRT’s podcast series.  To hear this podcast or another podcast focused on home buying, please click here.

But they come with additional considerations beyond what’s included when purchasing a single-family home. Here are the top five items to research in advance:

1. Understand exactly what you are buying when you make an offer, as the word “condo” refers to a legal form of ownership, not a particular type of property. Condo buyers generally own only the interior space of their homes; the exterior structure, land and amenities are usually owned collectively by all of the owners in the complex. Be sure to ask who owns the interior walls? What about the land beneath the home? What maintenance are you responsible for? Do you have your own parking? How many and what kind of vehicles can you park?

2. Research the homeowner’s association—and its board members. Ask for a copy of the association’s financials, including a certified budget and the latest annual reserve study; this can help you determine whether any fee increases are imminent. How is the association organized, and who runs it? How are voting percentages determined, and what would be your percentage?

3. Be aware of all related fees, including monthly association fees any special assessments. How are association fees charged and is there a limit on increases? Check whether utility charges and amenities are included, including pool maintenance. Also, be clear about what maintenance is included in the association fee, and what the condo owner must maintain.

4. Review the complex’s declaration, which helps you determine the monthly condo fee; the bylaws, which include items such as architectural requirements should you want to make any external changes to your condo; plats and plans; and rules and regulations. If the condo association is incorporated, your real estate attorney will want to review the articles of incorporation as well as any proffered disclosure documents. Also, have your attorney check for any “use restrictions” that might prohibit you from renting out the unit, which some associations include to protect financing and refinancing options.

5. Ask about the ratio of units that are rented versus owner-occupied. Your lender will likely require this information.

Condo ownership can be an attractive homeownership option for many buyers. But, it’s important that buyers do their research about the legal and financial implications before making an offer, in order to feel confident when getting to the closing table.

“What to research before buying in a multi-family community” is part of NRT’s podcast series.  To hear this podcast or another podcast focused on home buying, please click here.

Comps, or comparable homes, are used by Realtors, sellers, buyers, lenders and appraisers to determine a home’s value. Comps are pulled for both homes currently on the market and recently sold homes.

But what data is included when considering comps? How do you know if you’re comparing “apples to apples,” as they say? These are the factors you should consider:

Price – When determining a home’s value, it’s important to look at the final sales prices of similar homes that sold in the past three months (not just the prices that homes are currently listed for). The final sales prices show what such a home could actually sell for in the current market.

Age of house – The age of a home is important, as the potential need to fix major items such as a roof or plumbing should be taken into consideration.

Features – Also look for the presence or absence of similar characteristics, such as chimneys, decks, walk-in closets and oversized bathtubs. And don’t forget about upgrades. Even though a house may be 20 years old, the insides may not be. Did the previous owners renovate a kitchen to include today’s hottest features? Were new energy-efficient features installed throughout the house (such as appliances and insulation)?

Size – This includes the number of bedrooms and baths, additional rooms such as a study or playroom, number of garages, and lot size.

Square footage – Cost per square foot is an important measure in determining a home’s value. For example, if your home’s value per square foot is $250 and the average per square foot of nearby similar recently sold homes is $275, it shows that your home is valued less per square foot than nearby similar homes.

Elevation features – This includes brick, siding, gables, and more. Brick homes are typically worth more than others.

Foundation – Is the home built on a basement or slab? Homes on a basement are typically valued higher because there is more room for expansion.

By analyzing the comps – including the current competition and actual sales prices – sellers can appropriately price their homes to make them an attractive option, and buyers can know that they’re getting a fair deal on a purchase. A Realtor can help buyers identify home sales that are truly comparable and interpret the information about them.

“How to select a comp” is part of NRT’s podcast series.  To hear this podcast or another podcast focused on home buying, please click here.

The ongoing discussion whether or not the government will provide an extension for the homebuyer Tax Credit is finally put to rest! The President signed the bill into law today that extends homebuyers and unemployment benefits.  While the first Tax Credit program of 2009 focused on first time buyers, the addition of the repeat buyers will free up the middle market by allowing homeowners to sell to first time buyers and allow these buyers to “move-up”.  Finally there is an answer for buyers who continue to ask “what’s in it for me?” Below are highlights of how the homebuyer tax credit will work:

• Tax credit: Ten percent of the purchase price of a primary residence, up to a maximum of $8,000 for first-time homebuyers and $6,500 for repeat buyers who purchase between December 1, 2009 and May 1, 2010. First-time homebuyers are defined as people who have not owned a home in the previous three years. Repeat buyers must have owned their current home at least five years. The credit cannot be used for houses costing more than $800,000.
• Deadline for qualifying: Purchase agreements must be signed by April 30, 2010, and closings must be final by June 30.
• Military deadline: The deadline is extended by a year for members of the military who have served outside the U.S. for at least 90 days from Jan. 1, 2009, to May 1, 2010.
• Income limits: Individuals with annual incomes up to $125,000 and joint filers with incomes up to $225,000 qualify for the full credit. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits.
• How to apply: Taxpayers can claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a payment. Taxpayers who want immediate refunds can amend their tax returns for 2008 to claim the credit.
• New anti-fraud limitations imposed.
• Cost: $10.8 billion.

Source: Bloomberg Press and Associated Press and confirmed information with the content of the Senate bill