Teachers: Share With Us Your Cares & Concerns About Homeownership

[Kent Simpson]

A productive learning environment is best achieved when there is participation, n'est-ce pas?

I welcome any comments, concerns and issues that teachers are wondering about concerning homeownership!

[Brad Brown]

Kent,
A few teachers a I have spoken with in regards to purchasing a home right now are afraid that we are not at the bottom of the market. How would you address this objection?
Brad

[Ed Kowal]

Hi, Kent:

Can you tell me how a borrower would go about qualifying for the 2008 Homeownership Tax Credit? Thanks!
-Ed

[Kent Simpson]

Hello Brad and Ed -

Brad, waiting to buy at the very bottom of the market sounds good on the surface, but can be a strategy that will fail in the long run. It isn't so much the price of the property--it is the price of the money used to get it. Saving a few thousand dollars on the price of a home is moot when compared to the interest rate on the loan to buy it. Right now, interest rates are excellent - but who knows if they will stay there? I use the analogy of hearing that a gas station across town had the best prices in the area...but by the time you get there, it is only a penny less per gallon than the one in your neighborhood.

Ed - great question...with a simple answer: Any person who is a first-time homebuyer (who hasn't purchased one in the 3 years prior to this purchase) who purchases a home between April 9, 2008 and July 1, 2009.

[Troy Schuricht]

What are your suggestions on over coming the fears in the market place?

[Eddie Ange]

A lot of people are looking for that perfect home at the lowest price. Look at what is going on with the RTC and their purchase of non-performing notes from the banks. What impact will this have on the current and future market? After many discussions with economists and others in the real estate and lending business I believe this will help the current market and ensure growth in the future.

How, you might ask? There are many theories, but the one that continues to come up is the purchase of the non-performing notes will slow the tide of bank owned properties coming to the market. The bank owned properties are a major contributing factor to the property values dropping. Banks need to get the properties off their books, so they sell the properties below the current market value to move the debt. Once a property sells below the current property value the next has to sell below that, and so on.

With the number of bank owned properties coming to the market slowing, property values will at first will decline at a slower rate then start to increase. When will this happen? Many people that I have talked to believe it is currently happening. Others believe that the increase in property values will start to raise mid-2009.

So, the best time to buy is when the housing market is in the bell curve of the market. I believe, after my discussions, that we are in that bell curve. It is hard to predict with accuracy when the market will turn and usually it happens with out people knowing. And, different areas change at different times.

But everyone that I have talked to believes that the time is right and the average buyer, non-investor, should take advantage of the pre-boom prices. Interest rates are good and there are very nice properties out there at reasonable prices.

Remember, this is just one persons impression after many discussions with others across the nation. I just thought I would share my opinion.

[Robert Martin]

The bank foreclosures (REO) are where the deals are in most markets across the country. Instead of worrying about and waiting on the slowing of REO properties on the market, buy one. Owner occupied homes cannot compete with these bank owned properties in price. There are several ways to buy REO properties as both an investor and end users (owner occupants). If you are looking for a home to live in, check out the HUD site for your state at www.hud.gov click on your state and follow the site to find what is available in your town. I personally have several deals going with owner occupants that are buying HUD properties. There are plans at this time with $100 down payment, $1,000 rebate to the home buyer from HUD if closed within 30 days from the date HUD signs the contract. This is with FHA financing where it is possible to get financing with lower credit scores compared to local lenders with more stringent credit score requirements.
Yes, there may be some walls that need painting and maybe a room or two may need new carpet but many people buy brand new spec homes where they have to paint and do their own upgrades, all the while paying top dollar for their market. This way you put you taste/style in a home and make real equity.
The deals are out there. I list and sell for major banks across the United States for my area and I am the HUD listing agent for multiple Counties. I have been able to get some amazing deals for clients. I personally live in a home that was an REO. It needed a new roof, interior paint and I put in a new furnace/central air. I currently have over $40,000 in equity conservatively. I am about to sell to buy another since I have lived in the home for over 2 years. I have another REO I purchased, repaired and it is now in Pending. I will clear $22,000 on a $45,000 total investment. So, there is real money to be made as both an end user and an investor. The KEY is in the negotiations and knowing when to make the offer based on list price and days on the market. Most Realtor's do not know that much about how the REO process works and HUD is an entity all unto itself. When homes have been on the market over 130 days I have seen homes sell to investor's for less than half of the listing price. The REO market takes a long time to study and understand but if you find a savvy Realtor that really knows REO's they can be a gold mine.

Eddie Ange said:

A lot of people are looking for that perfect home at the lowest price. Look at what is going on with the RTC and their purchase of non-performing notes from the banks. What impact will this have on the current and future market? After many discussions with economists and others in the real estate and lending business I believe this will help the current market and ensure growth in the future.

How, you might ask? There are many theories, but the one that continues to come up is the purchase of the non-performing notes will slow the tide of bank owned properties coming to the market. The bank owned properties are a major contributing factor to the property values dropping. Banks need to get the properties off their books, so they sell the properties below the current market value to move the debt. Once a property sells below the current property value the next has to sell below that, and so on.

With the number of bank owned properties coming to the market slowing, property values will at first will decline at a slower rate then start to increase. When will this happen? Many people that I have talked to believe it is currently happening. Others believe that the increase in property values will start to raise mid-2009.

So, the best time to buy is when the housing market is in the bell curve of the market. I believe, after my discussions, that we are in that bell curve. It is hard to predict with accuracy when the market will turn and usually it happens with out people knowing. And, different areas change at different times.

But everyone that I have talked to believes that the time is right and the average buyer, non-investor, should take advantage of the pre-boom prices. Interest rates are good and there are very nice properties out there at reasonable prices.

Remember, this is just one persons impression after many discussions with others across the nation. I just thought I would share my opinion.