Fannie Mae changed the rules for condo purchases. 70% of new projects (new construction) must be sold in order to qualify the unit as a Fannie Mae project. In the past, 51% of the units had to be under contract. Fannie Mae has tightened the guidelines in order to prevent further loss of revenue from these projects. If 70% of the new projects are not sold, financing has to come from other sources.
Warehouse lending has become more difficult. In 2003, at the height of the mortgage industry, more than 50% of the Mortgage business was originated by Mortgage Brokers. Now, only about 16% of teh business comes from Mortgage Brokers. A huge amount of Mortgage just got out of the business. It has become more difficult for them to be in business due largely to government regualtions.
Mortgage Brokers still in business are more qualified and have to work harder to stay qualified. Also, it is a challenge to stay tuned with the constant changing of the rules. Mortgage Banking is another option for originating a loan. In those cases, the loans come from the bank. So, the client buying the home still has choices. it is just the view on the inside of the industry that looks very different.
The good news is: home buying affordability is way up! When one considers the price of homes being very low, interest rates historically low, and the $8,000 first time home buyers tax credit make it an incredible time to buy a home. What an incredible opportunity!
In terms of what is going on in the Mortgage Industrym the pendulum has definitely shifted from the philosophy of everyone should be getting a loan to people must be qualified to buy a house.
The median home price for April 2009 was $124,000. "The median" is a term describing the half way price point. So, half of the homes sold in April were below $124,000 and half sold were above that amount. It's actually a pretty good measurement to determine how overall home prices are doing relative to another time in history.
For example, the median home price fell 6% from a year ago. That means the home values generally dropped. Although, this seems like tough news, The National Association of Realtors said that it fell 13.8% nationally.
It is also interesting that the amount of homes sold in April was also down 22%. What that means to those of us selling our homes, is that we have to become even more aggressive on our price if we want our house to sell.
A stunning revelation of the advantages of home ownership was published by Robert D. Dietz, Ph.D. in an article he published March 27th entitled The Tax Benefits of Home ownership.
Dr. Dietz ran the numbers and discovered that, "a household with $80,000 in annual income who obtains $200,000 mortgage will save on average $1,765 in the first year of home ownership. By the end of the fifth year of homeownership, the household will save on average $8,607 on taxes, and this amount grows to $19,488 by the end of the average period of ownership - twelve years. This stylized homeowner can expect to save $21,650 in capital gains taxation, yielding a total benefit of $41,138 over the expected period of homeownership."
He also "provides variants of these calculations if the analysis allows the homeowner's income to increase with their age and labor market experience. For example, the five-year taxx savings for this homeowner increases to $9,723."
His findings go on to calculate, "how the numbers are increased by the existence of the temporary $8,000 first-time homebuyer tax credit. In the case illustrated above, the five year tax savings estimate increases 82% from $9,723 to $17,723."
The tax advantages for home owners are staggering. The deductibility of mortgage interest, deductibility of real estate taxes and capital gains exclusions for principle residences create unreal tax savings. Homes are and will continue to be a strong vehicle for helping us create wealth in our lives.
This paper has been made courtesy of www.HousingEconomics.com
Perry and Lynn arrived in Panama City Beach, Florida on Friday March 27th. They were there to set up for the arrival of 340 High School students to Bible and Beach 2009. The students came from Southeast Christian Church in Louisville, Kentucky.
Once the students arrived, the stage was set for some amazing biblical teaching from Mark Moore of Ozark Christian College. Matt Bayless from Northside Christian Church led some incredible times of worship. During the week, everyone studied the book of Exodus.
Fun was a major component of the week. The students participated in volleyball tournaments, flag football games, sandcastle building, square dancing and a talent show. Pictures of the event can be found on www.bibleandbeach.com
It truly was an amazing time to see what God was doing with his High School students. A dozen students were baptized in the ocean; two rededicated their lives to the Lord. Over forty students made a decision to make a 180 degree turn to get their lives back on track.
Nearly every student that went to Florida made a dramatic commitment to radically change something in their life and their community to bring Glory to God. Perry and Lynn really are grateful for the opportunity to be apart of it as it happened. Given the opportunity, they would go to Bible and Beach all over again.
In the March issue of Business First Magazine, all of the real estate firms in Louisville were ranked according to how many sales each office made in 2008. Here is that ranking:
It is absolutely amazing to consider a real estate office opening in an exteremly competitive marketplace wand within one year taking the number ten sport in that marketplace. Especially, since it did not open until March of 2008.
The phenomenal growth is due in large part to the culture of the office. The marketcenter is agent centric. One of the primary focuses is on educating and equipping the individual agents to exceed to the highest levels in their businesses. Uniquely, the agents train each other. It's not a staff person assigned to training agents. A spirit of collaboration is formed when agents share what they know and grow stronger as a result.
It is reflected in an abundance philosophy that is shared among the agents. The feeling is there is enough real estate business for everyone, even during times of scarcity. That atmosphere creates an energy that helps the agents succeed even more. It becomes infectious and causes the office to grow both in the amount of agents in the office and their individual production.
1230 S. Hurstbourne Pkwy Suite 100 Louisville, KY. 40222
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