Roy Sanborn --Lakes Region of New Hampshire

The residential home inventory in the Lakes Region of NH inched up to an even 1,000 properties on the market as of April 1, 2009. That is up about 60 homes from last month and represents about an 11% increase in homes on the market compared to last April. 1,000 homes translates to about 18 month's worth of inventory on the market based on the rate of sales over the past year.I just recently sold a home to a buyer from California. He was in the position to buy anywhere in the state and, in fact, anywhere in the country. But he chose NH primarily for tax reasons and after looking around the state he settled on the Lakes Region and bought a home in Gilford. His choice didn't necessarily have anything to do with the community or even the Lakes Region in general but had more to do with the value he saw in the property that he purchased (although I believe he will soon discover the benefits of the area and learn why so many people want to live here). Part of the value he saw in the property that he purchased was an astounding, panoramic view encompassing the Gunstock Mountain Resort, Winnipesaukee, and mountains beyond. It has one of the best views I have seen from any home in the Lakes Region. The design of the home maximized and framed the view from every level and just about every room in the house. The view was a huge part of the appeal and perceived value in this purchase.

A property with a view of lakes and mountains will undoubtedly bring a higher sales prices than comparable properties without a view. How much more depends on the view itself and what that view is worth to any given buyer. Some buyers don't care about a view, but those that do will pay more for it. Thank goodness that the well worn phrase "a $1 million view" isn't taken literally because in NH the "tax man cometh". The debate over the controversial, so called, "view tax" in NH has been relatively quiet although it has received some press earlier this year.

The Department of Revenue Administration claims that there is no "view tax" in NH but that there is a "view factor" which translates into higher taxes for the homeowner that can gaze out at mountains or lakes even though he doesn't own what he looks at. So in reality, there is a view tax, they just don't call it that. The NH Assessing Standards Board readily admits that there are no standards set for determining the value of a view which makes the assessing process very subjective to say the least. So the value of the view could be affected by which assessor gets sent to look at a property, what kind of mood he is in, or even the weather. How much is that sunset really worth? Perhaps it is foggy, raining, or snowing that day and the view isn't quite as nice. And what if you look out at something undesirable. Say there is an ugly cell tower in the way of the view or junk cars in the neighbor's yard. Shouldn't you get a negative view tax credit? And with no real established standards for assessing views, it is unfair to all the taxpayers who make up the difference when some properties are under assessed.

The fact remains, however, that view properties routinely sell for more than non-view properties. So a buyer purchasing a home with a view should be well aware that he is going to pay more every year in taxes than his neighbor's comparable home at the bottom of the hill. It is no wonder there are many proponents of some other method of raising the required revenue to run our communities and state.

There are so many great views in the Lakes Region I thought I'd have a "view" contest and I'd pay the winner's next tax bill as the Grand Prize. After regaining my senses and rethinking that offer (the real estate market is bad you know and REALTORS aren't getting any bailouts) the contest would actually be mostly for fun and a $100.00 prize. Send me a photo of the view from your home along with your contact information to my attention at Roche Realty Group or email me at rsanborn@rocherealty.com. Yes, waterfront views are also views! I'll post them here on my website and on May 13th an independent panel of judges (I promise, no tax assessors) will pick the best view submitted. I know, the $100 won't pay your tax bill but it's a start...

Residential Homes Available April 1, 2009

TOWN	TOTAL	< 100K	100 to 200K	200 to 300K	300 to 400K	> 400K	AVG LIST PRICE	MEDIAN PRICE	AVG DOM
ALTON	116	4	25	41	17	29	$487,702	$274,950	190
BARNSTEAD	85	6	38	31	6	4	$219,680	$199,900	182
BELMONT	90	9	32	22	15	12	$251,758	$209,900	172
CENTER HARBOR	20	0	3	4	1	12	$706,250	$472,450	227
GILFORD	131	3	22	19	23	64	$919,238	$399,995	154
GILMANTON	64	2	20	21	10	11	$303,046	$237,400	226
LACONIA	181	8	55	35	27	56	$395,520	$279,900	220
MEREDITH	102	3	9	17	27	46	$812,169	$380,800	256
MOULTONBORO	121	4	13	29	20	55	$862,112	$379,000	187
NEW HAMPTON	29	0	5	16	3	5	$305,514	$259,000	203
SANBORNTON	29	0	6	9	4	10	$380,988	$299,000	173
TILTON	32	3	10	6	9	4	$279,256	$281,950	171
TOTALS	1000	42	238	250	162	308	$539,435	$295,000	205

Data compled from the NNEREN as of 4/1/09.

There were 39 residential homes that changed hands in the month of February in the Lakes Region of NH compared to 30 in same month last year. The bulk of the sales were below $200,000 so that obviously has an effect on the average sales price shown. Activity does seem to be picking up on the lower priced properties and I have even run into several multiple offer situations on some of them. The decreased days on market in some of the towns show that when buyers see value they do buy. There are certainly great buys on some of the properties in the Lakes Region right now.

You can find many properties listed for far less than the town’s current tax assessment. Last week one buyer put a nice bank owned townhouse in South Down Shores under agreement. It appeared to be a very good deal as it was offered at $134,000 or $100,000 under the tax assessment. The unit next door is currently on the market for $219,000. Similar units were selling in the mid to high $200,000 range not long ago. Another home that went pending was a bank owned, 1988 vintage, 4 bedroom colonial on South Rd in Belmont. It was offered at $184,900 which was considerably less that the assessed value of $313, 400. A property on Windsong Place in Meredith was also quickly put pending when the price was reduced from $139,900 to $124,900. It is currently assessed at $251,000. This was a solid, 1,500 square foot home with a two car garage on 5 acres. It definitely needed some cosmetic work and upgrades but was undoubtedly a great deal for the right buyer.

If you are looking to pick up a deal in today’s market, here are a few things to consider:

Just because a property is offered at what seems to be an unbelievably great price it doesn’t necessarily mean that it is a good buy. A home offered way below the tax assessment doesn’t make it a steal, but it is a place to start your search. You really have to go look at a property closely to determine if it looks like a good deal. The $70,000 to $100,000 waterfront or water access camp is probably really not going to turn out like what you envisioned. If the price seems to be too good to be true, it probably isn’t. Many times an extremely attractive price equates to a property in very poor condition, but there are the exceptions.

Home inspections are always recommended and even more so with a bank owned property. Bank owned properties are often left in a deteriorated state by the former owners, they are sold in “as is” condition, and you won’t get disclosures or any history about the property. Bank owned properties are winterized and left unheated which really is not good for the house. Some homes have had water damage which can turn into a mold problem when the heat is turned back on. Many of these properties are better left for contractors to go in and rehab. But you will find some in excellent condition or simply in need of some cosmetic work and those are the good buys.

A really good option to bank owned property is to look for a competitively priced, owner occupied, property that is in nice condition. Someone who has owned a property for a long time can often be competitive in pricing and the home is usually better maintained. Buyers will also get all the proper disclosures and history of the property. Sometimes the better deal is not necessarily the home with the cheapest price tag.

RESIDENTIAL HOMES SOLD FEBRUARY 2009

TOWN	# S0LD	< 100K	100 to 200K	200 to 300K	300 to 400K	> 400K	AVG SELLING PRICE	MEDIAN SALES PRICE	% SOLD TO LIST $$	AVG DOM
ALTON	3	2	1	0	0	0	$101,333	$90,000	78%	36
BARNSTEAD	4	1	3	0	0	0	$106,500	$110,500	90%	120
BELMONT	7	1	4	2	0	0	$169,436	$160,000	96%	137
CENTER HARBOR	0	0	0	0	0	0	-	-	-	n/a
GILFORD	1	0	1	0	0	0	$120,000	$120,000	88%	49
GILMANTON	4	1	0	2	1	0	$239,312	$245,125	92%	95
LACONIA	7	3	2	0	0	2	$246,569	$125,115	93%	124
MEREDITH	2	0	2	0	0	0	$155,000	$155,000	84%	136
MOULTONBORO	4	0	0	1	0	3	$1,079,556	$1,049,112	86%	114
NEW HAMPTON	3	2	0	1	0	0	$141,667	$95,000	91%	285
SANBORNTON	2	0	1	0	0	1	$322,500	$322,500	92%	426
TILTON	2	0	2	0	0	0	$124,250	$124,250	101%	84
TOTALS	39	10	16	6	1	6	$273,846	$150,000	89%	111

DATA COMPLIED FROM THE NNEREN MLS SYSTEM 3/16/09

Cram Down?

Unlike the stock market, home inventory levels remain high. We really need stocks to go up and inventory to go down. There are 941 residential homes available as of March 1 in the Lakes Region of NH which represents about 17 months worth of inventory. The average list price is $547,575 and the median list is $299,000. In March of 2007 there were 885 homes on the market with an average list price of $556,118 and a median list price of $321,000. Basic economics says that lower prices should increase sales, it is just a question of how low and when. But prices are not the only factor affecting our housing markets.

The government is trying to stimulate the housing markets which are clearly in dire need of help. But even with the glut of homes on the market, low interest rates, and depressed prices many buyers are still reluctant to jump into the market. Pending home sales in January across the country dropped 7.7% after a gain of 4.8% in December. Not a great start to what most consider the fourth year of this down market. Many prospective homeowners think that prices are still going to fall further. Financing, or the lack of it, can certainly be an issue and is keeping many out of the market. Others are just plain scared to make a move given all the uncertainties in the economy and some even think that interest rates will go even lower. I don't see interest rates going lower especially if the new administration can get Congress to pass an extremely controversial piece of legislation that is appropriately called a "Cram Down" provision.

This "Cram Down" plan is intended to help stem the tide of foreclosures by allowing bankruptcy courts to modify the mortgages of homeowners that are in trouble. The plan is to reduce the principal amount owed on the loan and make the monthly payments on the home more affordable. The purpose here is to put pressure on loan servicers to "voluntarily" reduce mortgages before the buyer files for bankruptcy. Supporters of this legislation say that lenders are not doing enough to modify the loans of borrowers on the brink of losing their property. While everyone would like to see homeowners be able to stay in their homes, especially the mortgage holders, many homeowners may still be unable to make even the reduced monthly payments. The nation's largest lenders are lobbying heavily against this proposal. They say that it would have a huge negative impact on the already weak mortgage markets by creating even greater risk for the lenders. They say this proposal would result in higher down payments, interest rates, and closing costs on new mortgages further stalling any housing recovery. I don't know about you, but anything that is named a "Cram Down" plan, no matter what it is referring to, doesn't sound very good.

Residential Homes Available March 1, 2009

TOWN	TOTAL	< 100K	100 to 200K	200 to 300K	300 to 400K	> 400K	AVG LIST PRICE	MEDIAN PRICE	AVG DOM
ALTON	116	6	18	41	17	34	$518,146	$281,750	208
BARNSTEAD	77	9	33	28	5	2	$207,593	$199,900	187
BELMONT	86	9	31	20	14	12	$254,116	$207,400	181
CENTER HARBOR	14	0	1	3	1	9	$845,936	$574,450	279
GILFORD	126	4	19	21	21	61	$915,625	$394,498	214
GILMANTON	55	3	17	11	11	13	$327,401	$249,900	250
LACONIA	174	8	49	40	27	50	$392,868	$279,450	213
MEREDITH	100	3	10	13	31	43	$814,771	$377,450	251
MOULTONBORO	111	4	11	26	18	52	$866,445	$385,000	184
NEW HAMPTON	27	0	5	15	1	6	$305,659	$250,000	186
SANBORNTON	27	0	4	10	4	9	$379,209	$287,900	186
TILTON	28	2	9	7	6	4	$279,821	$255,950	173

Compiled as of March 1, 2009 from the NNEREN MLS system.

Yes, we can?

I think I can safely say "I have seen the bottom of the market and this is what it looks like". We had a mere 28 residential sales in the month of January 2009 for the towns in our Lakes Region of NH list. That is down from 34 last January and 57 in 2007. The good thing, I guess, is that sales can't go much lower so surely we have only one way to go and that is up. Most agents I have spoken with lately are seeing increased activity which hopefully translates into more contracts in the coming months.

The new economic stimulus package that was just passed has an $8,000 tax credit for a first time home buyer which, unlike the $7,500 tax credit last year, does not have to be paid back as long as the home in kept for three years. This credit is available to taxpayers who purchase a primary residence between Jan.1 and Dec. 1, 2009. There are income limits to qualify: you can't make more than $75,000 if you are single or $150,000 for married couples. The Rural Housing Service also received additional funds for their direct and guaranteed loan programs which are used frequently for first time buyers here in NH.

President Obama has released details of a $275 billion Homeowner Affordability and Stability Plan to help homeowners struggling to stay out of foreclosure as well as expanding the role of Fannie Mae and Freddie Mac to stem the tide of increasing foreclosures. There are provisions in this program to help millions of responsible homeowners who can't refinance because of falling property values, as well as "at risk" homeowners who need interest rate reductions to get their payments down to manageable levels. Lenders can receive financial incentives from the Treasury matching the amounts they modify interest payments by and yearly incentives if their borrowers stay current on their loans. Homeowners in the program will also receive a $1,000/yr principal reduction for five years if they stay current on their loan. There are many guidelines and tests to qualify but it should help 7-8 million homeowners. However, this plan will not help the majority of homeowners in the country that do pay their mortgages on time. It also won't help millions of homeowners that have loans that are not already backed or guaranteed by Freddie or Fannie or if they simply owe way more than their house is worth. Fannie and Freddie will also receive increased funding from the Treasury to ensure strength and stability in the mortgage markets, maintain mortgage affordability and to, theoretically at least, increase confidence in them.

That brings me to my point. Lack of confidence. We all sincerely hope that these stimulus packages actually work and that they stabilize the housing and economic markets. But the fact is we have an unprecedented confidence crisis in this country which is paralyzing the economy as much as any other factor. We get a daily dose of mood altering "downers" by way of daily newscasts, articles, speeches, and doom and gloom predictions from analysts and politicians all the way up to our newly elected president. The Brits weren't this negative when London was being bombed on a daily basis in WWII. We need a stimulus package for our mood as much, if not more, than for the financial and housing markets. When people are beat down every day by relentless gloom and doom predictions they won't buy much of anything let alone new houses. I am not sure why the folks down in D.C. who have strapped this nation the biggest "mortgage" in the history of the world don't see that. Vince Lombardi said "Confidence is contagious. So is lack of confidence". A little more positive reinforcement from those in charge probably won't cure everything by itself, but it surely wouldn't hurt. What happened to "Yes we can"?

Residential Homes Sold, January 2009

TOWN	# S0LD	< 100K	100 to 200K	200 to 300K	300 to 400K	> 400K	AVG SELLING PRICE	MEDIAN SALES PRICE	% SOLD TO LIST $$	AVG DOM
ALTON	4	0	3	1	0	0	$175,500	$158,500	94%	132
BARNSTEAD	2	1	1	0	0	0	$93,442	$93,442	112%	117
BELMONT	3	1	1	0	1	0	$179,788	$165,365	95%	208
CENTER HARBOR	0	0	0	0	0	0	-	-	-	-
GILFORD	2	0	1	0	1	0	$272,685	$272,685	95%	264
GILMANTON	3	1	1	1	0	0	$142,600	$171,900	96%	119
LACONIA	4	0	3	0	0	1	$303,875	$185,250	86%	121
MEREDITH	3	0	1	1	1	0	$255,000	$223,000	94%	148
MOULTONBORO	4	0	1	0	3	0	$287,500	$332,500	99%	133
NEW HAMPTON	1	0	0	1	0	0	$210,000	$210,000	81%	14
SANBORNTON	1	0	1	0	0	0	$163,000	$163,000	102%	59
TILTON	1	0	1	0	0	0	$179,000	$179,000	97%	83
TOTALS	28	3	14	4	6	1	$217,283	$173,935	94%	139

Data was compiled as of 2/16/09 using the Northern New England Real Estate MLS System. The days on market are current only & do not reflect the DOM for a previously listed property

There are a total of 923 residential homes available in the towns in our Lakes Region of NH list. That is up just slightly from last month and represents about 16.5 months worth of inventory currently on the market.

February is a good time to get started on your tax return if you haven't already. There's not a lot to do on weekends now that the Super Bowl is over. Patriots fans should have had their returns done several weeks ago but sometimes it just takes awhile to get back to a normal life. If you are a homeowner, particularly a new one, you need to know that there are a number of deductions that you can take on your taxes that help offset the many other joys of homeownership that you will encounter in the coming year. You can Google "Publication 530" to see the IRS explanation of the deductions allowed as well as a number of other sites that actually explain it all in English.

Your home offers you some giant tax deductions so make sure you take advantage of them. The two big ones that stand out are property taxes and mortgage interest. We are blessed with high property taxes here in NH (I am kidding) and there is little doubt that interest is the bulk of your mortgage payment so these two are the biggies. But if you just bought your house in the last year you can also deduct any points you paid to get that reduced interest rate and also be sure to deduct the pro-rated taxes that you paid that appear on the settlement statement you received at your closing. If you are paying PMI, Private Mortgage Insurance, you can also now deduct that as well but the policy has to be issued after Dec 20, 2006. Interest on that home equity loan that you took out is also deductible even if you used the funds to buy that new boat or a two month vacation in Hawaii. Interest on mortgages for second homes is also deductible but we'll worry about that when we can actually afford to buy one! But did you know that that second home could be a RV or a boat as long as it has sleeping, cooking, and bathroom facilities. Bob houses don't count.

If you sold your home, costs associated with the sale such as real estate commissions, title insurance, and legal fees are all deductible from any taxable gain you might have. Perhaps the biggest wealth builder related to owning and selling a home is the capital gains exclusion. This allows you to keep, tax free, any profits on the sale of your primary residence up to $250,000 if you are single or up to $500,000 if you are married. Make sure you keep records of all real improvements you made over the years as these are added to you cost basis so they can be deducted from your profit. Don't confuse home improvements with home repairs and maintenance which are not deductible. You must have lived in the residence at least two of the past five years and you can only take advantage of the capital gains exclusion once every two years. But what a deal!

You can claim other tax reductions for having an office in your home if you meet certain requirements. Your office must be used regularly and exclusively for business purposes and be your principal place of business where you meet with clients and customers. Be careful with this one. Be sure to consult with a good accountant or tax preparer on anything you have questions on.

Residential Homes Available as of February 1, 2009

TOWN	TOT.	< 100K	100 to 200K	200 to 300K	300 to 400K	> 400K	AVG LIST PRICE	MEDIAN PRICE	AVG DOM
ALTON	115	7	19	38	18	33	$509,107	$284,000	197
BARNSTEAD	71	6	29	30	4	2	$216,668	$209,900	192
BELMONT	87	12	31	20	11	13	$249,663	$209,900	173
CENTER HARBOR	15	0	2	3	1	9	$814,667	$499,900	261
GILFORD	133	4	21	22	19	67	$920,853	$409,000	198
GILMANTON	55	3	17	15	7	13	$315,921	$239,000	237
LACONIA	166	12	42	38	23	51	$400,158	$279,900	215
MEREDITH	100	3	9	15	32	41	$822,085	$374,900	250
MOULTONBORO	103	2	13	21	20	47	$837,702	$389,000	194
NEW HAMPTON	22	0	5	12	1	4	$289,450	$249,950	203
SANBORNTON	29	0	6	12	3	8	$354,119	$279,900	263
TILTON	27	3	11	5	4	4	$257,866	$199,900	156
TOTALS	923	52	205	231	143	292	$548,470	$295,000	207

Stats generated from the NNEREN MLS system on 2/1/09