Is the Spring Market Coming Early???

Punxsutawney Phil, the Seer of all Seers and Prognosticator of all Prognosticators saw his shadow on February 2nd. He says there will be six more weeks of winter. Mainstreet's January housing reports say maybe the spring housing market is coming earlier.

The average sales price for single family detached homes jumped 4.5% for closed sales in January 2010. That is the first increase since December 2007 with most of the months since then being in the negative percentile. Now may be the best time to jump into the buying and selling marketplace. The first time buyer credit is available until April 30, 2010 and the closing must take place by June 30, 2010.

Many communities showed significant gains in average home sales prices. This could mean that the move-up buyer is utilizing the other tax credit which is available. If you have lived in your current home 60 consecutive months out of the last 96 months, you are eligible for a $6500 tax credit also.

Now is the time to get that home on the market. It looks like March and April could be exactly like October and November 2009 when many first buyers were jumping into the marketplace trying to get a contract on a home before the deadline expired.

Punxsutawney Phil says there may or may not be 6 more weeks of winter. One thing we do know for certain, you have only 10 more weeks to use the buyer tax credits.  Hopefully, whether you are buying or selling, the spring market will work for you.

ENERGY STAR Appliance & HVAC Rebates in Illinois!

The State of Illinois recently announced rebates to Illinois home owners from now through Earth Day. Some of the rebates can be doubled-up with Federal tax credits for additional savings!  All ENERGY STAR products are tested to ensure that they save energy over traditional models, and pass additional quality checks so that they will last.  If you have been thinking about making improvements to your home, now is a great time! 

See the full details on how to earn the rebates, and how to earn Federal tax credits as well.  The quick summary is below:

*  WATER HEATERS - State rebate of 25% off at the register from now until they run out. Buy models that are >= .82 efficiency to earn additional 30% federal tax credit!

*  FURNACE & AC - State rebate of $350-1200 off (depending on unit) at the register from now until they run out.  See link above for details on how to earn additional 30% federal tax credit too!  Always best to do an Energy Audit of your home before you purchase new HVAC equipment. 

*  FRIDGES, FREEZERS, DISHWASHERS, CLOTHES WASHERS & WINDOW AC appliances - State rebate of 15% off at the register.  Additional mail-in rebate up to $100 if you recycle your old appliance!  Available only from April 16-25.

FHA Guideline Changes for 2010

FHA Guideline Changes for 2010

There are many new guideline changes for FHA in 2010. Some are positive and some are not so positive. However, many of these will benefit real estate professionals and home buyers. Here are some highlights of some of those changes:

• Increase Up-front Premiums for FHA Mortgage Insurance
  Effective on or after April 5, 2010, FHA will collect an upfront mortgage insurance premium of 2.25 percent. This will increase premiums for purchase and refinance transaction.
• New Down-payment/Credit Score Requirement
  Effective on or after April 5, 2010, loans with FICO scores of 579 or lower will require a down-payment of 10% and loans with FICO scores of 580 or above will require the current 3.5% down-payment.
• Decrease in the Maximum Seller Contribution
  Effective on or after April 5, 2010, maximum that is currently at 6% will  become 3%.
• New Approval Process for Condominium Projects
  Spot approval process being replaced by new streamlined process, which may affect buyers, sellers/developers and homeowner associations.

So what are the benefits to real estate professionals from these changes?

1. More buyers will enter the market because they can afford the lower down payment.
2. No single investor can purchase more than 10% of the units, so the idea of a controlled association by one or two investors is no longer a threat.
3. More inventory will offer wider choices tending to keep prices in check, as "FHA approved’ condominiums come on line.
4. The lender who provides the mortgage will have to approve not only the condo documents, but the condo association’s budget, reserve account and its fidelity insurance policy.
5. New construction developers have the guidelines needed to create urgency in their pricing strategies, which is key to building and maintaining momentum.
6. Commercial lenders will have a more comfortable level with developers. While the 50% presale requirement may look obtrusive, it is actually a benefit to the developer, because it will create urgency for buyers to purchase.
7. Established associations that have dragged their feet to get their finances in order, now have a valid value-based reason to become "FHA Approved. "
8. Real estate agents will show FHA approved condominiums with confidence in the association’s finances, not just because the down payment is low.
9. Forward thinking lenders will hustle to become a "an approved lender’ in resale and new communities alike.
10. Knowing the property already has approved lenders will make competition for listings tighter and will attract more buyers and more prospects to the listing.

Brokers taking listings in condo communities without FHA financing will be competing with ones that do, making it important for associations to seriously consider becoming FHA approved.

First time home buyers are generally thought of as the primary market for FHA financing. There is something to that, but in today’s world, many who bought their first homes years ago and lost them during this recession will appreciate the FHA financing availability even more than those coming out of rentals.

Ice Damning Warning Signs

It is not uncommon this time of year to see water stains at wall and ceiling corners where you have never seen it before.

Typically this type of water entry is caused from a phenomenon called "ice damning". Ice damning occurs when we have snow and ice followed by above freezing temperatures. The surface snow and ice melt and pool in an area that the ice was too thick to thaw at the same rate. It then re-freezes at night as the temperatures drop making the block of ice even thicker. The next day the same cycle happens. The pond gets deeper and eventually goes over the top of the flashing and enters the house at the wall, soffit or the roof deck. Once this happens you see either water staining or wet spots on the inside walls, ceilings or floors.

This is something that should not be ignored, over time mold and wood rot came develop. If you see this at your home or building have it looked at sooner rather than later.