Real Estate Information

Good Morning America cited data from Zillow this morning which heralded Virginia Beach as the number one place, and Richmond as the number seven place, to buy a home right now.

When buying a home, according to Zillow, buyers should “look for communities with a strong job market and stable housing values. Some common threads: cities with military bases, state capitals and college towns all fare well because they are more ‘recession proof.’”

Here’s what Zillow is seeing…

In Virginia Beach:

- Median home value: $223,800, down 1 percent from a year ago.
- Property values are up 7 percent compared to five years ago.
- Houses cost an average of $139 per square foot.
- Buyers are paying 2 percent less than the listing price.

In Richmond:

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can't be used to cover the minimum 3.5 percent, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum 3.5 percent downpayment.

There remain many sources of assistance for buyers needing help with the 3.5 percent downpayment, including many state and local government instrumentalities and nonprofit lenders.

In addition, some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment. These programs are separate from what HUD announced today.

The first-time homebuyer tax credit was enacted last year and improved upon earlier this year--to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 and is available to households that haven't owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment.

Learn more about the credit, including how to apply for it this year even if you've already filed your taxes.

Source: Robert Freedman, REALTOR® Magazine Online

A common question Virginia Beach area homeowners ask is what do they need to do to get ready for property management.  Here is a list of things that should be helpful to most owners. The important thing is to create a baseline to work from, so when your tenant leaves they know what is to be expected of them.  

1. Whole house, attic, garage & shed clean and free of all personal property. Anything left behind may not be there when you return.

2. All doors, window facings and baseboards cleaned and touched up as needed.

3. Blinds and ceiling fans clean and in good working order.

4. Ensure all light bulbs, switches and fixtures are in good working order.

5. All appliances, vents & filters clean and in good working order.

6. Kitchen & Baths need to sparkle. Sinks and tubs have to have working stoppers and properly caulked where needed.

7. Have carpets professionally cleaned.

8. Have fireplace & chimney professionally inspected and cleaned.

9. Install "heavy duty" door stops behind each door.

10. Heating & A/C system serviced and new filter(s) installed.

11. Provide current code and instructions for security system.

12. Each floor is required to have working smoke detector with fresh batteries.  Carbon monoxide detector (gas homes) and halon fire extinguishers recommended, but not required by Virginia law.

13. Garage door opener & remote(s) need to be in good working order and have fresh batteries. Provide current code and instructions for using exterior key pad.

14. Have grass freshly cut, all flower beds clean & weeded and install fresh mulch. Provide name & number of who will cut grass until rented if necessary.

15. Provide 4 keys for each unique lock. If more than 2 unique locks, have locksmith re-key locks to one matching key. Please verify all keys work, including new keys!

16. Repair wall holes and touch-up and/or paint where needed.

17. Provide good notes and instructions for unique things about your home that can help the tenant and your property manager in the future.

I hope you found this list of items helpful.  If you have any questions or need a referral to hire someone to help perform any of these tasks to prepare your home for property management, please feel free to give me a call.  Jorge Gonzalez, RE/MAX Allegiance 757-287-3400.

Freddie Mac put together a new video on their website to help Virginia Beach area homeowners understand the new “Making Home Affordable” program.  In this video, Ingrid Beckles, Senior Vice President, Freddie Mac, explains how borrowers can determine their eligibility for “Making Home Affordable” and use the plan to refinance their current mortgage, or if they’re already behind on their loan or facing a financial hardship, get a modification that makes their mortgage more affordable.  Click here to access the video.

Frankly, my opinion on paying good money to subscribe to a foreclosure website is it is basically a waste of money and I can provide a buyer with a list of foreclosure and short sale homes that are actually for sale for free.  I will explain this furhter, but let's discuss the issues with foreclosure websites first.

The problem with foreclosure websites is they draw their info from public notices, city records and the like for free.  Then they repackage the information to sell to the public on the internet. This is perfectly legal, but not always very helpful to buyers. A buyer would have to do all the legwork trying figure out what is good and what is not. For most buyers, they do not have the time or know how to do this. To make matters worse, not all homes on these sites even make it to foreclosure to begin with.

The real drawback to paying money to subscribe to a foreclosure website is the information is not always accurate either.  I will share with you a great example of this.  A friend of my mine owns several investment properties.  Her mortgage company recently sold her loans to another mortgage company, and the new company has messed up the payment processing for her accounts.  She has actually paid the mortgages on time, but her rental properties are showing up on these sites as going into foreclosure for non-payment.  Now some prospective buyers are writing her tenants letters and knocking on their doors to get into the houses to find out how to buy them.  

My advice to buyers is to just focus on all homes that are actually listed for sale.  You also need to understand that just because it is a foreclosure does not make it a great deal either. Please remember foreclosure homes have probably been neglected for a long time, since the owner could not pay their mortgage it is unlikely they kept up with preventive maintenance or other repairs either.  Many will have undisclosed problems and most will require some investment and sweat equity to bring them up to par. For some buyers, it may just be a better idea to buy a non-foreclosure home without having to deal with the unknown factors.  

Most of legitimate properties for sale that are foreclosures and short sales are listed in the MLS.  I have a program that can provide buyers with automatic daily e-mail of listings of the homes in the Virginia Beach area and other Hampton Roads cities are listed as bank repos, short sales, and Government owned VA and HUD homes and I can do this for you for FREE. The best part is you would know about these homes before most agents and other buyers even realize these homes are for sale. All you need to do is let me know what you are looking for and I can set it up for you today!

If you would like to discuss the issue further or you would like to receive foreclosure listings by e-mail, please drop me a line at Jorge@House4U.com.

The $8,000 Tax Credit can be earned by purchasing any home in Virginia Beach and Hampton Roads area, whether it be new construction or any residential home on the market.  If you are intertersted in finding out more about the $8,000 First-Time Home Buyer Tax Credit Program, please let me know.

Video Source: NAHB

For Rent $1,500, 2100 sqft in Virginia Beach home

2024 Twinflower Ct

Congress has included language in the economic stimulus package to compensate service members who sell their home at a loss or have been foreclosed upon because they were forced to move after a base closure, reassignment or a combat wound required them to be relocated near a health facility. The program also covers surviving spouses of those killed in combat.  Under the new provision, the government will cover 95 percent of a loss if a service member is forced to sell. The government can also choose to acquire the title of a home by paying off the balance of a service member's mortgage or paying the owner up to 90 percent of the home's previous value. No dollar ceiling has been set.  Click here to read more in a recent Virginian-Pilot article.

Source: Center For Real Estate Newsletter

Here’s a warning for potential borrowers: Nervous lenders have tough new rules and are paperwork crazy.

"Borrowers are going to have to prove they are the borrower they say they are," says Keith Gumbinger, vice president of HSH Associates, a mortgage-industry publisher in Pompton Plains, N.J.

Gumbinger says homebuyers should consider these things before they apply for a loan.

1. Down payments are critical. Borrowers should expect to put down at least 10 percent for a “conforming loan” – a mortgage that Fannie Mae and Freddie Mac will purchase.

2. Credit scores count. A 720 on the 850-point FICO rating scale will get a borrower access to the best rates. Rich Bira, branch manager of FCM Direct Lender in Chicago, says: "A score between 720 and 739 gets 0.125 percent added to the rate, a score between 700 and 719 gets 0.375 percent added to the rate, and a score between 680 and 699 gets 0.5 percent added to the rate.”

3. Consider VA and FHA Mortgages. Borrowers without down payments or with less than stellar credit scores should consider these government-insured loans offered through the Federal Housing Administration of the Veterans Administration.

4. Unearth the records. Before applying, borrowers should organize tax, banking and other records that prove income, savings and debts. They should also expect to be patient about what may seem to be endless requests for information.

5. Get rid of debts. Limiting debts, including what borrowers expect to pay for the mortgage, to less than 43 percent of gross income is important.

Source: NAR

If you thought you were the only one frustrated by people benefiting from not taking personal responsibility for poor investment decisions and having responsible taxpayers bailing them out, check out Rick Santelli's rant on CNBC.