David Monsour

According the Gettysburg times the borough residents will receive a 1 mill tax hike for 2010. This will result in 117,000 in increased tax revenue.

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The idea behind the tax increase is to cover the debt on a 3 million dollar loan that is needed to rehab the Gettysburg Borough Offices. It's estimated that this project will cost about 2 million dollars. Some motivation for doing this now instead of later is the favorable interest rates that are currently available. The other one million will go toward infrastructure of the borough.

The mileage rate will increase from 14.38 to 15.38. The current rate is already the highest in the area. This is partially due to Gettysburg College operating as a not for profit, thus not paying borough property taxes. While Gettysburg College does bring a lot of money into the area is creates some issues with the tax base. The borough footprint is relatively small to begin with so subtracting anything in terms of property taxes creates some budget issues.

For those of you who want to know how this will effect your personal taxes you'll need to find your assessed value (this is available at the courthouse, it is not the price you paid for your house) and multiply that by 0.01538. Then take your assessed value and multiply by .01438. Take the first number and subtract the second and you'll have your change in taxes. This doesn't include any changes with school tax however.

(assessed value x .01538) - (assessed value x .01438) = Change in taxes for 2010.

If you're a borough resident I'll happily provide assessed values just send an email to david.monsour@gmail.com

The Realtor Association of York and Adams Counties (RAYAC) just recently released the sales statistics for September of 2009. Before I analyze anything you see here I want to make sure that the difference between Mean (Average) and Median is Understood.

Mean or what is commonly know as Average is the Sum (add up all the values) of a group of numbers, divided by the total number of values. Example (2,7,9,4,5 add them up = 27 divided by the number of numbers which is 5 = 5.4. We round down to an average of 5) I'm sure everyone knows how to average numbers, but few know what the median is.

The Median (courtesy of www.Investorwords.com) One type of average, found by arranging the values in order and then selecting the one in the middle. If the total number of values in the sample is even, then the median is the mean of the two middle numbers. The median is a useful number in cases where the distribution has very large extreme values which would otherwise skew the data. The reason we are using the median is because there are homes that sell for 10,000 and homes that sell for 1,000,000 or more which would classify as large extreme values as stated above (see median)

Because my primary market is Gettysburg I'm going to cover that area. If you have questions about other areas I can certainly answer any questions you might have. Feel free to email me at David.Monsour@gmail.com with specific questions.

Gettysburg, Pa showed an increase in both median sales price and number of homes sold, which is great news. However before you start jumping for joy and calling your Realtor to increase your price you have to realize that even though we used the median of 130 homes sold in September, statistically speaking, that sample is relatively small.

This number may be caused by a large number of homes selling in a higher price bracket thus shifting the number high enough to show an increase, but this does not necessarily mean that home values on the aggregate have increased. When we price homes we have to find other comparable homes that have sold. We cannot simply translate this to mean that all homes have increased in value 3%.

What we can take away from this is a sign of improvement in the market. We can evaluate again next month to see if this trend continues and possible formulate a better conjecture as to what the future of the Gettysburg market might look like come spring. Look on the bright side, Gettysburg is the only place in Adams county that is showing a potential increase in value. Let's the hope the trend continues and brings the rest of the county along with it. Biglerville's median price is up but the number of homes sold is down significantly.

Interest rates and the potential expansion/extension of the tax credit could really play a roll in home values. Higher interest rates decrease buying power, and the tax credit is propping values somewhat artificially. We should have a better idea of the trends in the next few months.

My contact information is below if you are considering buying or selling in my local market.

This is an email I just received from Kevin Downs, he is a Lender with Guaranteed Home Mortgage Co., Inc out of York, PA. We are currently working on an FHA 203k loan, and I'm very impressed with his responsiveness, and ability to stay ahead of the game, especially considering our Nov. 30th deadline and the difficulty of closing this loan in a short period of time. God willing we'll get it done by our deadline. *fingers crossed* I'm sure Kevin is doing all that he can. That being said I thought this information was certainly worthy of passing on, and he gave me permission to do so....so here you go..

FHA is making dramatic changes to their guidelines as of January 1 2010. Please do not get caught saying “how did my lender not know this”. Listed below are some highlights of the anticipated changes and what they mean to you and your customer.

There have been all kinds of rumors about the changes FHA are making for 2010, so I wanted to give you a condensed version of what are the most important ones.

The No. 1 change is how FHA certifies it lenders. FHA is getting rid of what they call the mini eagle. (Guaranteed Home Mortage Co or GHMC is a FULL EAGLE and MEETS AND EXCEEDS ALL REQUIREMENTS) GHMC is a Mortgage Bank however most brokers operate under this mini eagle status. They had to be approved by FHA and have a certain net worth. The lender now called “the funding source” has to maintain FHA certification not the mortgage broker. This is good news for the mortgage broker, lenders and consumers as it will ensure competition and more access to FHA loans.

The funding source or the lender must have a minimum and audited net worth of $1 million. (This will eliminate most small questionable brokers) The funding source must submit an audited financial statement to FHA every year to verify they meet this criteria. It is believed that the net worth will only go up in the future.

FHA is really looking for lenders to have some “skin in the game.” FHA is seeking to ensure they have enough capital available to compensate FHA if their loans fail to meet FHA standards. This will tighten supply as the lenders will become more conservative when making decisions on approving a loan. They will have some responsibility on the performance of the loan. FHA is looking for lenders with deep pockets.

They are also making changes to a FHA streamline refinance. Currently if you have an FHA loan, you can refinance to lower your rate, with just an application and a verbal verification that you are still employed. They do not make you document your income or assets. Basically the new streamline transaction must now be a fully documented loan. They verify your employment and assets. An appraisal will be required if you want to add your closing cost in the new loan. This will also tighten supply and slow down the refinancing process for the consumer.

What about the appraisal process? Yes, we will be going to the same system Fannie Mae and Freddie Mac are using, the dreaded HVCC system. This will slow down the process and add more cost into the appraisal which they will be passing on to you, the consumer. The appraisal will only be good for up to four months.

FHA has been a great product over the years and has been a stabilizing factor in today’s real-estate market. It still allows the consumer to obtain a home with only a 3.5 percent down payment. With prices affordable now, first-time homebuyers account for nearly 40 percent of all sales.

WHAT DOES THIS MEAN:

The FHA continues to be a great loan resource. Please allow me to anticipate the changes with the guidelines and make sure you and your customer do not suffer. Remember, November 30^th is the cut off for the tax credit. As of today there is no bill passed that will extend it. There is a bill in Congress, but believe it or not it is meeting resistance. Lets all keep our fingers crossed. Now is not the time to be hedging your bets on brokers.

Below is Kevin's contact info if you're local or semi local and need a loan give him a ring.

Kevin Downs

Guaranteed Home Mortgage Co., Inc.

500 Greenbriar Road

York, PA 17404

717-542-3109 mobile

717-779-0500 office

717-779-0800 fax

888-846-6304 toll free

Many people don't realize how powerful interest really is. We figure we buy a home for 200,000 we are paying back 200,000 and a little extra. Well that little extra is really a lot extra. While I was doing some reading a few months back I came across this article on www.inman.com. While most of us expect interest rates to jump up at some point few buyers realize how much that really changes the amount of money they pay back over 30 years. So if you are reading this and your sitting on the fence, it might be enough to push you over the edge. Rates are still low, extension of the tax credit is still an unknown at this point, but after reading this, the potential 1% or 2% change in interest rate is more than enough to make up for the 8000.00 dollar tax credit.

"Get buyers off the fence and under contract. Use your marketing materials to let potential clients know that now is the best time ever to buy. Even if prices drop further, show buyers how an increase in interest rates can easily wipe out any savings they would have experienced by waiting.
For example, on a $200,000 loan, an interest-rate increase from 6 percent to 7 percent will result in an additional $47,340 in interest payments over the life of a 30-year loan. This means that a one-point interest-rate increase will cost the buyer an additional 23.7 percent in payments. If interest rates increased from 6 percent to 8 percent on a $200,000 loan, the increase in interest would cost the buyer an additional $96,620 over the life of the loan. In other words, the buyer would pay more than 48.3 percent of the loan amount in additional payments.
While prices may still be falling in some areas, in most places the amount of inventory is starting to shrink. As the inventory declines, prices will stabilize. The probability that prices will decline an additional 23.7 percent to 48.3 percent is highly unlikely. On the other hand, the probability that interest rates will increase appears to be quite high (Bernice Ross, Inman News 6/8/09).

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I'm sure now that you've completed reading what Bernice has calculated that your thoughts on interest have probably changed. Don't be alarmed if you missed the tax credit, because rates are still competitive. You still have a chance to score a 5.5% interest rate or better. It's still the right time to buy, we just don't know if that magical 8000.00 will be available or not...and really lets face the facts they are just giving you 8000.00 of your own money because it will get recouped via taxes at some point. Consider it more like a cash advance.

Listing a house for sale can be quite the process for the average person. Everything from interviewing Realtors, to reviewing their individual marketing plans can be difficult. It might even go over your head. They might start talking about things like IDX, and SEO, and all of these online sources where your listing will be showing up. Your house will be in this MLS and that MLS. Most sellers are thinking, in the words of Jerry Seinfeld, "Yeah just do what you gotta do, to get it sold." If you're Seinfeld savvy you may have realized that I added the "to get it sold" part.

That being said when you enter into an agency agreement with a Realtor to sell your house you should certainly expect that person to be working hard for YOU. I personally look at it as more of a partnership, and here is why. Neither one of us gets what we want if we don't work together. I want to sell your house for YOU to get YOU the best possible return on YOU'RE investment, in turn I get a commission check. Until your house is sold all of the advertising money is out of MY pocket. I basically get a refund at settlement, and maybe a little spending money too. So working together and keeping a good line of communication will only help with our main objective, which is putting a big SOLD sign in front of your house.

I am more than happy to service the following areas:

Gettysburg, Biglerville, Cashtown, Fairfield, Carroll Valley, Littlestown, Hanover, Bonneauville, and any of the small areas in between.

If your plans are to upgrade in the near future and you'd like to know what your house might sell for, give me a call. I'll do a market analysis for free. I just ask that if I do a market for you, that you give me a chance to compete for the listing when the time is right.

I look forward to hearing from, and working with all of you.

David Monsour's Blog