Home Buyer Information
Does Big Discount = Good Deal?
November 10th, 2008 categories: Home Buyer Information
$10,000 discount on selected homes, $15,000 decorator allowance, $10,000 towards closing costs, $2,000 gift card … all of these are forms of incentives Spring Texas home builders are offering to attract buyers. But does a big discount equal a good deal on a home?
The builders certainly want you to think so. And home buyers, you want to think you got a good deal too. Because nobody wants to overpay for a home. And after all, if the home builder tells you its a good deal it has to be a good deal. Right???
WRONG!!!! Here’s some food for thought. Maybe the builder is offering BIG discounts on his remaining Spring Texas homes because nobody else wanted them. Maybe the reason they have not sold is because the homes are over-priced in comparison to other homes available on the real estate market.
Or maybe the home is in a less than desirable location (such as backing to a busy road, backing to commercial, close to a railroad track, or close to an airport). Maybe the homes have not sold because of its lot characteristics (such as power lines in the back yard or the size of the back yard is small.)
Maybe the builder is offering a BIG discount because the selections in the homes are customized. But not customized in a good way. They have been personalized to the extreme (such as green carpet or a red tile backsplash when the other houses in the neighborhood have tan carpet and beige tile backsplash).
All of these are reasons why BIG DISCOUNT DOES NOT EQUAL GOOD DEAL. Because they all affect the future resale value of the homes.
There is only one way to know for sure if you are getting a good deal on the purchase of your Spring Texas home. Get a knowledgeable Realtor to represent you in the purchase. He/she will be able to advise you as to how the home’s location, amenities, color selections, and lot characteristics will affect the home’s future resale value. By analyzing the prices of recently SOLD comparable homes, your Realtor will negotiate a good deal for you and not just a good deal for the builder.
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How to get an INTEREST FREE LOAN from the Government
November 7th, 2008 categories: Home Buyer Information
It seems like every couple of days I hear about the government bailing out this company or giving this other company a loan. I am to a point that I want to know what I have to do to get a government loan. Because after all if the government is giving out money …. I want some too.
You probably have not heard that you may qualify to receive an INTEREST FREE LOAN from the government. Why? Because bad news SELLS and GOOD news well it is just not as exciting.
Now, I don’t qualify for the interest free loan since I am not considered a “first-time home buyer”. So I am still going to be waiting for my money. But if you DO meet the government’s definition of a first-time home buyer, you can get a 15 year interest free loan up to $7,500. I know its not as good as FREE money since the money has to be paid back. Although, it is still a sweet deal.
The interest free loan is called the “first-time home buyer tax credit” and it is part of the Housing and Economic Recovery Act of 2008. The Recovery Act was designed to give housing a shot in the arm and a reason for buyers to purchase a home.
So who is considered a first-time home buyer? A buyer who has not owned a principal residence within the last three (3) years.
What are the other requirements?
- You have to purchase a resale or new home between April 9, 2008 and June 30, 2009
- Don’t exceed modified adjusted gross income levels. The entire $7,500 loan is available to individual tax payers with modified adjusted gross income of $75,000 and $150,000 for married taxpayers. A portion of the $7,500 loan is available to individual taxpayers and married taxpayers with a modified adjusted gross income of $95,000 and $170,000 or higher, respectively. If your modified adjusted gross income levels are higher than the amounts above, the government has decided you are doing fine on your own and you do not need their loan.
How do you actually get the first-time home buyer tax credit (A.K.A. “Interest Free loan”)?
Take the tax credit on your federal income tax return.
- If you purchase a home in 2008, take the tax credit on your 2008 tax return.
- If you purchase a home in 2009, before you file your federal income tax return for 2008, take the credit on your 2008 return. You do not have to wait until your 2009 return to file for the first-time home buyer tax credit.
- If you purchase a home in 2009, after you filed your 2008 tax return, take the credit on your 2009 tax return.
The tax credit has to be paid back to the government over 15 years which would $500 a year. But the GOOD news is that your first payment does not begin until two years after you claimed the tax credit. For instance if you file for the tax credit on your 2008 return, your first $500 repayment does not occur until you file your 2010 return.
Now I know if you are a first-time home buyer, this all has to sound very confusing. You are right, it is confusing. But DO NOT let that stop you from getting an interest free loan to help you with your real estate purchase. Call us, Rick Ratchford at 281.300.3141 or Jill Wente at 281.804.8626 (Spring Texas Realtors) and we will help you understand how you can take advantage of this program.
After all, the majority of government programs are confusing. And its obvious to me why people don’t take advantage of them. The government programs are either too hard to figure out OR the people that qualify for them have not heard of them.
Read also:
- FHA minimum down payment set to increase on January 1st, 2009
- 4 Reasons to get pre-approved before shopping for your Spring Texas home
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Is your home inviting?
October 31st, 2008 categories: Home Buyer Information
Or does your home scare away more buyers than a haunted house does trick or treaters on Halloween?
If you have your home on the real estate market, you need for it to look inviting and cheerful. But you could be scaring away buyers without even knowing it.
How ??? By your home’s photos. Buyers make decisions upon which homes to view based upon its photos.
Do the photos of your home’s listing look inviting? Or were they taken on a dark dreary overcast day that makes your house look like its possessed? Is your house subliminally sending a message of STAY AWAY because all of its blinds are closed and the window treatments are drawn.
What about the interior photos? Can you identify which rooms the photos are taken of? Or do the photos make you wonder what’s lurking in the dark?
What about the subject matter of the photos? Do the photos showcase the animals you bagged on your latest hunting expedition or your prized sword collection or your son’s collection of Freddy Kruger posters?
High quality photos will bring buyers through your doors while bad photos will scare buyers away. If no buyers are knocking on your home’s doors, review the listing photos of your home. And ask yourself if your home says “COME ON IN” or “STAY AWAY”.
HAPPY HALLOWEEN from Jill and Rick - Spring Texas Realtors
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All Real Estate sites have the same listings - True or False?
October 23rd, 2008 categories: Home Buyer Information
FALSE. All real estate sites DO NOT have the same listings. In addition to real estate sites missing active home listings, their listing data contains OUTDATED PRICES and homes no longer on the market.
Say it isn’t so Batman. Well, I am not batman but it is the TRUTH. A recent survey performed by WAV Group for Roost.com identified the inaccuracies in listing data between various real estate sites. In the sample of missing listings in Dallas, Zillow was missing 64% of the listings, Yahoo was missing 54%, Trulia was missing 46%, and Google was missing 31% of the real estate listings. If you are looking for a home, that’s a lot of homes that you are not getting an opportunity to choose from.
Why are the real estate sites missing listings? The missing listings and inaccurate prices has to do with the source of the real estate sites listings. The most accurate source of real estate listings and prices is through the LOCAL MLS.
The above mentioned sites DO NOT receive a direct feed from the LOCAL MLS. Thus causing the major real estate sites to compile listings from numerous sources including advertising publications, agents, and direct feeds from brokers. Since the major real estate sites do not have direct feeds from ALL brokers nor the listings from ALL agents, its inevitable that they are going to be missing listings.
The cause of inaccurate listing prices is due to some of the same factors. The advertising publications are not notified of listing price changes and in turn the real estate sites are not notified. We, real estate agents are just as guilty. We adjust a price in our local MLS but don’t take the time to adjust the price at ALL the real estate sites where we have posted our listings.
So if you are a Spring Texas home buyer looking for the most complete and accurate source of listing data where do you go? Search for homes on real estate sites that receive a direct feed from the local MLS. These sites include our real estate site, broker sites, and the consumer site of our local (Houston Association of Realtors). All are powered by the local MLS which is the most reliable source of listing data.
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FHA minimum down payment increase postponed to January 1, 2009
October 2nd, 2008 categories: Home Buyer Information
If you thought you missed out on the lower minimum down payment for FHA loans, don’t worry due to a postponement you still have time. The minimum down payment for FHA loans which was scheduled to increase from 3% to 3.5% on October 1, 2008 has been postponed. The revised effective date of the increase is now January 1, 2009.
The media has done there best to scare home buyers into believing that they can not get a loan because the credit markets have dried up. But in a discussion I had today with one of our local Spring Texas mortgage lenders, she said “I am looking for loans. We have money to lend”.
But are the curret interest rates any good? I asked that question today and the answer was “the interest rates are good. FHA loans for a 30 year term are averaging around 6%”. They are not quite as low as they were a couple of weeks ago when the government announced their take over of Fannie Mae and Freddie Mac but they are a far cry from the 10% mortgage interest rates of the early 1990s.
Good news for Spring Texas home buyers!!! Low interest rates and low minimum down payments are still available for at least a couple more months. Plus with 6.9 months of inventory the Spring Texas real estate market is considered to be a buyer’s market. If you are a buyer your best opportunity for low interest rates, low minimum down payments, and low prices is right now.
If you want to take advantage of the current financing and buying opportunity, give us a call at 281.300.3141 or 281.804.8626 and we will be happy to help you.
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9 things you should know about homeowners insurance
September 27th, 2008 categories: Home Buyer Information
Health insurance and homeowners insurance … both are coverage we know we need but rarely take the time to understand. That is until we need it.
Hurricane IKE’s recent roll through our area sent a lot of Spring Texas homeowners scurrying for their policies. Unfortunately some homeowners were taught a painful financial lesson that they won’t soon forget.
9 things you should know about homeowners insurance?
1. Two Deductibles- Unlike automobile insurance, your homeowner’s insurance has two deductibles.
The first deductible is for wind/hail damage and it is a % of the rebuilding cost. The lowest percentage available is 1% with the deductibles of most insurance companies being 2% to 5%.
The second deductible is for “other perils” which would be fire, lightening, theft, and smoke damage. Insurance companies offer a fixed deductible with the lowest typically being $1,000.
2. Flood Insurance is separate- Flood insurance is NOT included in your homeowner’s insurance policy. The policy has to be purchased separately.
3. Flood insurance is not effective immediately - Don’t wait until hurricane season or until the weatherman says there is a hurricane on the way before securing flood insurance. Because insurance companies require you wait 30 days before your flood insurance policy becomes effective.
4. Does not cover replacement- If you have trees that fell and had to be removed, your homeowner’s insurance does not cover the cost of new trees to be planted in their place.
5. Food spoilage has a deductible - A lot of us experienced extensive power outages due to Hurricane IKE. By the time the power was restored, our refrigerated food had spoiled. Since the spoilage was caused by a wind / hail incident, our food spoilage was part of our wind/hail deductible.If food spoilage was the only damage we experienced, our spoilage would have to be more than 1% of our rebuilding cost before our insurance would kick in.
6. Coverage not automatically adjusted - Review your policy annually and make the necessary adjustments to reflect the value of your home and its contents. Don’t put yourself in a position of being under insured. Adjust the value of your policy to match your home’s price appreciation.
7. Watch your renewal terms - Earlier this year, State Farm insurance changed their customers wind/hail deductible from 1% to 2%. There were some very unhappy homeowners who discovered through the claim process that their deductible had doubled. When your policy renewal shows up in the mail spend the time to review the deductibles. Don’t assume they are the same as last year.
8. Shop around- the rates for homeowner’s insurance vary significantly amongst insurance companies. Don’t assume that since your insurance company had the best rates when you shopped around 5 years ago that they still have the best rates today. Shopping around is worth your time.
9. Discounts available - Some insurance companies offer a “multi-line” discount if you purchase both home and auto insurance from them. Don’t forget to ask about discounts.
A little time and a few precautions will help to protect the investment you have in your home. If you are looking to purchase a home or are interested in selling your Spring Texas home, call Jill Wente & Company at 281.804.8626 or 281.300.3141.
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Spring Texas home sellers missed opportunities
September 11th, 2008 categories: Home Buyer Information, Home Seller Information
The topic for this post “Spring Texas home sellers missed opportunities” is courtesy of my husband, working partner, and fellow Prudential Gary Greene, Realtor, Rick Ratchford. Rick is an exclusive Buyers Agent meaning he only represents buyers and not sellers. I on the other hand represent both buyers and sellers but that’s a topic for a different post.
In his role as a buyer’s agent, Rick has in length discussions with buyers about their desires and needs in a home. He sets up an automatic email notification based upon specified home criteria for his buyers. So his buyers will be notified when a new home matching their criteria is added to the real estate market.
How does all this automatic email notification of new listings to potential buyers translate into missed opportunities for Spring Texas home sellers?
Its in the photos or in this case should I say lack of photos. Far too many times to count, Rick has seen email notification of new listings contain ZERO, ZILCH, NADA photos. Buyers purchase with their eyes. They do not write down the MLS number of the new listing and go search for it every day just to see if the listing agent has finally added photos.
Spring Texas home sellers you only have ONE opportunity to capitialize on pent up demand. If your listing agent is not on top of her / his game its gone. NO PHOTO AVAILABLE = NO SALE
If you are interested in purchasing a Spring Texas home, contact Rick at 281.300.3141 and he will set up an automatic email notification for you. You will then be one of the first to know when a new home is added to the market that matches exactly what you are looking for.
Read also:
- 4 Reasons to get pre-approved before shopping for your Spring Texas home
- Spring Texas home search - Not all sites are created equal
- How to get the best deal on your Spring Texas home purchase
If you are interested in selling a Spring Texas home, contact Jill at 281.804.8626. She will make sure that you do not miss out on pent up demand.
Read also:
- Selling your Spring Texas home - 9 mistakes to avoid
- When selling Spring Texas homes - more photos = more money
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What “Days on Market” really means
September 3rd, 2008 categories: Home Buyer Information
DOM or Days on Market - what does it really mean? The simplest definition of Days on Market (DOM) is …. its the quantity of days a property has had an Active status in our multiple listing service. DOM is a statistic that is open to interpretation as to what it really means.
The average days on market for Spring Texas homes is approximately 90. So what does that say about a home that has been on the Spring Texas real estate market for more than 90 days? Ahhh … that’s where the interpretation of the statistic comes in.
If the home has been on longer than the average DOM does it mean -
A) something’s wrong with the home? NO. Although this could be a reason, there are numerous other reasons why the home is still sitting on the market.
OR
B) the seller will accept a low ball offer? Again NO. Countless buyers believe that the longer a home has been on the market the more willing a seller should be to accept a low ball offer. If the seller is in a dire financial situation this may be true. But there are many reasons beyond financial ones that create a need for a homeowner to want to sell his home including downsizing, upsizing, or job change.
There are probably as many reasons as why homes sit on the Spring Texas real estate market longer than the average as there are colors in a box of Crayola crayons. And I am not talking about the small little box of 8 crayons. I am talking about the super duper jumbo box. The box with the crayon sharpener in the back.
The Five main groups of reasons that impact a home’s days on market are price, marketing, location, condition, and motivation.
PRICE: Not all homes are priced right when they are added to the market causing sellers to do several rounds of price adjustments before they finally get to the correct price. In my opinion, incorrect pricing is the number 1 reason why a home’s DOM ends up being longer than the average DOM.
MARKETING: Insufficient marketing and poor marketing will lengthen the amount of time a home is on the market. With 84% of Buyers starting their search on the Internet, homes that are not on numerous websites such as Trulia, Zillow, Realtor.com, Yahoo Real Estate, and Craigslists, are NOT being exposed to the largest pool of buyers possible. Numerous photos and quality photos are needed to peek buyers interest in the home. If the home has NO photos or bad photos, buyers move on and look at the next home that was returned in their search results.
LOCATION: A bad location will increase a home’s days on market. A home backing to a busy street, a cemetery, commercial property, or an apartment complex would be considered bad locations. Fewer buyers are going to be interested in homes in bad locations and thus it will take longer before that right buyer comes along.
CONDITION: The majority of buyers are not handymen and don’t want to buy a handyman special. Buyers want to move right in and immediately start enjoying their new home. Buyers want updated homes. The 25 year old appliances, out dated wallpaper and light fixtures, and butcher block counter tops might have good enough for the owners when they lived in the home but its not for the buyers. The non-updated homes will experience longer days on market because fewer buyers want to do the updating.
MOTIVATION: Non-motivated sellers want to sell and show their homes according their terms. Showings occur when its convenient to sellers and not when its convenient for the buyers. Reducing the quantity of showings and increasing the days on market.
In the end, remember Days on Market is a statistic. A statistic that an experienced Realtor will be able to interpret and tell you if the reason for a home’s high DOM will impact its future resale value.
Read also:
- Spring Texas real estate abbreviations - What do they mean?
- How to get the best deal on your Spring Texas home purchase
If you have questions about buying or selling homes in Spring Texas, please give us a call at 281.804.8626 or 281.300.3141.
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Texas ranks #8 lowest state in state-local tax burden
August 21st, 2008 categories: Home Buyer Information, Property Taxes
There is no denying that our real estate taxes in Spring Texas are higher than in other states. But you shouldn’t ONLY take into consideration real estate taxes when considering whether its affordable to live in Spring Texas.
For 18 consecutive years the nonpartisan Tax Foundation has published an estimate of the combined state-local burden of each of the 50 states. And they have just released the State and Local tax burden estimates for 2008 and our big state of Texas came in as the 8th lowest state in state-local tax burden. And this rating of being in the top 10 lowest states in state-local tax burden is not a flux. We have enjoyed this ranking for the last four years.
We, Texans, pay 8.4 percent of our income in state and local taxes, compared to New Jersey at 11.8 percent, New York at 11.7 percent, Connecticut at 11.1 percent and Maryland at 10.8 percent. What’s the national average? The national average state-local tax burden is 9.7 percent.
Would you be able to guess what state enjoys the lowest state-local tax burden? If you guessed, Alaska, you would be correct. Alaska’s state-local tax burden is 6.4 percent. The other states with a lower state-local tax burden than Texas are Nevada, Wyoming, Florida, New Hampshire, South Dakota, and Tennessee. Coming in at #10 is Louisiana with a state-local tax burden of 8.4%.
Just one more reason why we live in Spring Texas. Read our Top 20 reasons to call Spring Texas home. Did you hear the news that Spring Texas homes are #14 for affordability?
If you are thinking about relocating to Spring Texas, please give us a call at 281.300.3141 or 281.804.8626. We will be happy to help you find the right house to call “home” in Spring Texas.
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Minimum down payment on FHA loans increases Oct. 1, 2008
August 18th, 2008 categories: Home Buyer Information
If you have been counting your pennies and saving for the down payment on your Spring Texas home you will want to consider purchasing before October 1, 2008. Because on October 1, the minimum down payment requirement for FHA loans increases from 3% to 3.5% of the sales price.
FHA increase on minimum down payment postponed till January 1, 2009.
The increase in the minimum down payment is one of the provisions in the Housing and Economic Recovery Act of 2008. The same act that provides first-time homebuyers with a $7,500 tax credit.
You may think an extra .5% does not sound like a lot but let’s put it into perspective. On a $150,000 home, the minimum down payment increases from $4,500 to $5,250. A net increase of $750 which is the equivalent of about the cost of a washer and dryer. On a $200,000 home, the minimum down payment increases from $6,000 to $7,000. A net increase of $1,000 which is the equivalent of about the cost of a refrigerator.
In addition to the down payment that you will need to close on Spring Texas Homes, you will need money to cover inspection fees, earnest money, option fee, loan origination and other lender fees, prepaids, title fees, and don’t forget about the costs to move, a refrigerator, and a washer and dryer.
You can usually negotiate with the seller to pay some if not close to all of your closing costs and prepaids, but the down payment is not something that the seller can pay for you. In the end, an additional .5% for the minimum down payment is a BIG deal.
If you are tired of saving and want to take advantage of the lower minimum down payment requirement, give us a call at 281.300.3141 or 281.804.8626. We have significant experience with buyers purchasing Spring Texas homes with FHA loans and know how to structure deals to keep your out of pocket expenses down to a minimum.
Read also: 4 Reasons to get loan pre-approval before shopping for your Spring Texas home
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