Sherry Chastain We Buy & Sell Houses Nashville Tennessee

This Month in Real Estate
November 2009

Commentary

Budding signs of recovery continued last month. The encouraging news arrived in a number of closely followed economic indicators. On Thursday, October 29, the U.S. Commerce Department stated the country's recession has officially ended, at least as leading data indicates.

U.S. GDP expanded 3.5 percent in the third quarter, the first period of quarterly growth in more than a year. A strong bounce in housing sales activity in September, mainly due to first-time buyers' efforts to claim the tax credit before it expires for November 30, pointed to stabilization in the housing sector. And more good news this week as an extension and expansion to the Home Buyer Tax Credit made its way through a congressional vote and has officially been signed into law by the President.

The recovery will continue to develop in small steps. The Recent Nobel Prize winner in economics, Paul Krugman, praised the progress, stating the most severe part of the crisis has now subsided and "the end of the world has been postponed." Moving forward, trade imbalances and mounting levels of government debt, as well as high levels of unemployment, will need to be addressed. For now, governments including the United States will continue to provide stimulus support until the major economies are firmly on solid ground.

The Housing Market

Existing Home Sales - Up over 9%

• Existing home sales bounced back strongly in September with much of the increase being attributed to the rush of first-time buyers trying to claim the tax credit before the end of this month. Sales jumped 9.4 percent to 5.57 million units over August sales of 5.09 million, marking five gains in the past six months and is 9.2 percent above levels seen last year. Sales activity is at the highest level since July 2007 when sales hit 5.73 million.

Median Home Price

• Existing-home price was $174,900 in September, 6 percent higher from its low in January but still 8.5 percent below September 2008. Distressed properties, which accounted for 29 percent of all transactions in September, continue to hold down the median price, as they typically sell for 15-20 percent less than traditional homes.

Inventory - Lowest in 2.5 years

• The current housing supply is the lowest seen in two and a half years. Total housing inventory at the end of September fell 7.5 percent to 3.63 million existing homes available for sale, representing an 7.8-month supply at the current sales pace, down 16.1 percent from August's 9.3-month supply. Compared to a year ago, there are now 15 percent fewer homes on the market. According to Lawrence Yun, NAR chief economist, "If we could continue to absorb inventory at this pace, home prices would return to normal, modest appreciation patterns next year."

Mortgage Rates - Close to 5%

• Rates for 30-year fixed loans continue to hover around 5 percent. While having risen above the ultra-low 4.78 percent reached in the spring, rates remain at attractive levels for people looking to buy a home or refinance. As an economic recovery is underway and concerns over inflation come back, experts expect mortgage rates will likely go up.

Affordability - Very favorable

• Historically high affordability conditions coupled with the first-time buyer tax credit are boosting home sales. Home buyers continue to benefit from low home prices as well as unprecedented mortgage rates. "Potential first-time buyers can take heart in that affordability conditions this year are the highest on record dating back to 1970," according to NAR President Charles McMillan. So far this year, the home price-to-income ratio has fallen well below the historical average of 25 percent. The ratio now stands at 15 percent.

Sources: National Association of Realtors, Freddie Mac

Government Action

First-Time Home Buyer Tax Extended and Expanded

• As the deadline for the First-Time Homebuyer Tax Credit crept closer, it became a clear priority on the Hill. An extended and expanded home buyer tax credit is a part of a larger bill that also extends unemployment benefits. This bill was signed by President Obama on Friday, November 6. All new provisions became effective on November 7.

The bill essentially remains intact but has a handful of important changes:

1. Existing homeowners who lived in their previous home for 5 out of the last 8 years will be eligible for up to a $6,500 credit.
2. The income limits have been bumped up $50,000 to $125,000 for individuals and up $75,000 to $225,000 for couples.
3. Those who qualify will have until the end of April, 2010 to find their new home and have a signed contract on it. They will have until the end of June to close.
4. Military, foreign services and intelligence employees with extended active service may qualify for a few special provisions, including an extra year to take advantage and they may not need to repay the credit if they move during the first three years.
5. The home purcahsed must be less than $800,000
6. Must be over the age of 18 and not classified as a dependant for tax purposes to qualify.

Sources: Bloomberg News, The Washington Post, U.S. Government Printing Office

Higher Loan Limits Extended

• With the onset of the financial crisis, credit markets that were not backed or insured by the government froze. Mortgages that are backed by the government and purchased by Fannie Mae, Freddie Mac, and Ginnie Mae are called "conforming loans". One type of non-conforming loan is the "jumbo loan". Traditionally, jumbo loans are mortgages that are greater than $417,000.
• Since the crisis began, tightened lending practices have made this type of loan harder to secure. Jumbo loans currently come with substantially higher costs from larger down payments and higher interest rates. This has led to a 70% decrease in jumbo loan origination since 2007 and a greater inventory of homes in jumbo territory.
• As part of the stimulus bill earlier this year, the conforming loan limits were raised to 125% of median home prices to a limit of $729,750 for 2009 and were set to expire at the end of the year. On October 29, the increased loan limits were extended through 2010. This means it will be easier for sellers whose homes fall in this category and cheaper for buyers to secure financing next year, compared to if the government let the limits expire.

Sources: Inman News, National Association of Realtors

Topics For Buyers & Sellers

Peace of Mind Home Buyers Worried about High Unemployment

The average duration that unemployed workers are out of a job is currently more than six months, near the highest level since the bureau started tracking the figure in 1948. The total number of unemployed people stands at 15.1 million. 5.4 million of those have been looking for work for more than 27 weeks.

With incentives in the housing market, including very low interest rates, a large selection of homes for sale in many markets, and highly affordable home prices, concerns about the job market and possible unemployment have held back many potential buyers.

Here are a few suggestions for potential buyers and current homeowners:

1. Buy well within your means. Although home buyers often want to buy a home they can see themselves growing into, stay within a conservative percentage of what you currently make. If you had to take a part-time instead of a full-time job, if your salary or hours were cut, or if you become a one-income household instead of two, make sure your monthly payment would still be attainable.
2. Put down a large down payment. Not only will your monthly payments be less, but the equity from the down payment creates a buffer zone. If you put 20% down when you purchase your home and home prices in the area drop 5%, you still have at least 15% equity in your home. For sellers, this built-up equity provides flexibility-should you need to sell in a hurry.
3. Have an emergency fund. Experts advise everyone, not just homeowners, to have an emergency fund of at least six months' worth of expenses. This fund should be saved in a liquid account, like a money market or savings account, for easy access if needed quickly. With the average time to find a new job currently above six months, seven or more months of savings is a good goal.
4. Pay down other debts. Lowering or eliminating debt service is always a good move and is particularly wise in the current job climate. If you were without a job and income, lower fixed monthly expenses help ease your financial burden and stretch the money in your emergency fund.

Sources: Bureau of Labor Statistics, CNNMoney.com, etc.

Contact me,

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for information about what's going on in our area.

Newsletter Contents

1. General Commentary

2. The Housing Market

3. Government Action

4. Topics for Buyers
and Sellers

Wednesday, November 18, 2009

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Events November 18 - December 6

Alexander and the Terrible, Horrible, No Good, Very Bad Day at the Nashville Children's Theatre - through January 10, 2010

Bruce Springsteen at the Sommet Center - November 18

Fish & Friends at Swank's Martini and Wine Bar at the Doubletree Hotel - November 18

Patrick Rickelton at Mulligan's Pub - November 18

Off the Wall Lecture: "Re-assembling Reality: Surrealism and Surrealist Film in the 1920s and 1930s Paris" at the Frist Center for the Visual Arts - November 19

Johnny Barranco at Swank's Martini and Wine Bar at the Doubletree Hotel - November 19

Kathy Price at Copper Kettle - November 19

Celtic Thunder at TPAC's Jackson Hall - November 19

The Subdudes at 3rd & Lindsley - November 19

New Jersey Devils vs. Nashville Predators at the Sommet Center - November 19

Def Leprechaun at Mulligan's Pub - November 19 - 21

Tango & Ravel's Bolero at the Schermerhorn Symphony Center - November 19 - 21

Rachel Proctor and Friends at Copper Kettle - November 20

Opry at the Ryman featuring Little Big Town, Ralph Stanley, Shane Yellowbird and more - November 20

Williams & Clark at Station Inn - November 20

Knowing Me Knowing You ABBA Tribute at 3rd & Lindsley - November 20

Dee Lucas at B.B. King's Blues Club - November 20

Trio Ginga at Swank's Martini and Wine Bar at the Doubletree Hotel - November 20 - 21

Joe Purdy at 3rd & Lindsley - November 21

Mannheim Steamroller at TPAC's Jackson Hall - November 21

Shawn Camp, Mike Bub & Friends at Station Inn - November 21

Columbus Blue Jackets vs. Nashville Predators at the Sommet Center - November 21

Opry at the Ryman featuring Charlie Daniels Band, Ralph Stanley, The Lovell Sisters and more - November 21

Tennessee Repertory Theatre presents A Christmas Story at TPAC's Jackson Hall - November 21 - December 19

Sound Healing Workshop at Yoga Source - November 22

Nashville In Harmony Holiday Concert at the Frist Center for the Visual Arts - November 22

John Fogerty at the Ryman - November 22

The Guy Fieri Roadshow at TPAC's Jackson Hall - November 22

Messiah Sing-In with Music City Baroque at Christ Church Cathedral - November 23

Detroit Red Wings vs. Nashville Predators at the Sommet Center - November 23

Charlie Daniels Band, Gretchen Wilson, Phil Vassar, Chris Young and more at the Ryman - November 23

Amy Acklyn at the Wildhorse Saloon - November 24

Opry at the Ryman featuring Riders in the Sky, Chuck Wicks, Justin Moore and more - November 24

Miley Cyrus at the Sommet Center - November 25

St. Louis Blues vs. Nashville Predators at the Sommet Center - November 27

Opry at the Ryman featuring Hal Ketchum, Rhonda Vincent and more - November 27

Swagger at Mulligan's Pub - November 27 - 28

Mike Epps & Friends Comedy Explosion at the Municipal Auditorium - November 28

Florida Panthers vs. Nashville Predators at the Sommet Center - November 28

Opry at the Ryman featuring Hal Ketchum, Cherryholmes, Ricky Skaggs and more - November 28

Kathy Chiavola Band at Station Inn - November 28

Arizona Cardinals vs. Tennessee Titans at LP Field - November 29

Calgary Flames vs. Nashville Predators at the Sommet Center - November 30

Opry at the Ryman featuring Dierks Bentley, Jason Michael Carroll and more - December 1

Cider Carols presented by Hope Clinic for Women at Rocketown - December 3

Art After Hours at various downtown art galleries - December 3

Cheap Trick with Superdrag at the Ryman - December 3

Sesame Street Live! at the Municipal Auditorium - December 3 - 6

Opry at the Ryman featuring Marty Stuart, Del McCoury Band and more - December 4

Mayor's Annual Lighting of the Christmas Tree in Public Square - December 4

Nashville Christmas Parade along Broadway, 2nd Avenue, and the Woodland Street Bridge - December 4

Fiesta Mexicana at TPAC - December 5

Opry at the Ryman featuring Trisha Yearwood, Del McCoury Band and more - December 5

11th Annual Grand Day at the Nashville Children's Theatre - December 6

News & Information

New live music venue: 2nd Avenue Live!

2nd Avenue Live!. 154 2nd Avenue North, 2nd Floor. 242-7232. This new club located above Buffalo Billiards offers life music daily . Hours are Mon - Sun, 5 pm - 3 am.

What's for dinner? Thanksgiving Issue

Downtown restaurants and hotels: Is your restaurant serving a special menu for Thanksgiving dinner? Please email achampion@nashvilledowntown.com with all of the details so that we can include the information in next week's edition of Downtown Details.

Events this Week

Jammin' at Hippie Jack's TV Taping

Fri, Nov 20. Tennessee State Museum. 505 Deaderick Street. 741-2692. 6 pm. Free. The first of four musical showcases for the television taping of the PBS series, Jammin' at Hippie Jack's. Featuring ASCAP Songwriter of the Year and Grammy-nominee Darrell Scott with musician Kenny Malone. During intermission visitors will be able to view the current exhibition, Renaissance Jack: The Work of Jack Stoddart Hippies, Hill People & Other Southern Marvels, in the State Museum's Changing Gallery.

Gallery Talk: Georgia O'Keeffe and Her Circle of Early American Modernists
Sat, Nov 21. Frist Center for the Visual Arts. 919 Broadway. 244-3340. 11 am. Included with gallery admission. Vivien Fryd, Ph.D., professor and chair of the history of art department at Vanderbilt University, will examine the art of the early American Modernists associated with the so-called Stieglitz circlepainters Georgia O'Keeffe, Marsden Hartley, Arthur Dove, John Marin, Joseph Stella, and Charles Sheeler as well as photographers Gertrude Käisebeir, Anne Brigman, Alfred Stieglitz, and Edward Steichen. The styles, themes, and historical contexts of these modern visual images will be examined, focusing especially upon themes of sexuality, the city, spirituality, and nature.

The Guy Fieri Roadshow

Sun, Nov 22. TPAC's Jackson Hall. 505 Deaderick Street. 8 pm. $25 - $45. The popular Food Network host will serve up a jambalaya of comedy, music, dancing and cooking on the TPAC stage. Fieri will be joined by special guests Hayden "Woody" Wood, an Australian-based flair bartender; Tully Wilson, owner/executive chef of Tully's Bistro in Hartsville, TN; and Anne Burrell, host of the Food Network's Secrets of a Restaurant Chef.

Messiah Sing-In

Mon, Nov 23. Christ Church Cathedral. 900 Broadway. 255-7729. 7:30 pm. $10. Ticket information. Join in the celebration and sing along to Handel's Messiah with the Music City Baroque Chamber Chorus. This venerable work will be performed in shortened form and the audience will enjoy singing the most popular choruses of this beloved Christmas tradition.

$20 Nashville Symphony Ticket Sale

Now through Mon, Nov 23. Schermerhorn Symphony Center. One Symphony Place. 687-6400. Select seats are available for only $20 to eight remaining SunTrust Classical Series concerts and Bank of America Pops Series concerts. Tickets must be purchased at the box office or by calling 687-6400 (this promotion is not available online). Perfect gift for the holidays!

Massage Gift Certificate Discount
Now through Wed, Dec 23. Body & Sole has discounted Christmas gift certificates available. $50 for 60 minutes and $25 for 30 minutes. Certificates can be purchased online, by phone: 438-7477, or at the Body & Sole office: 162 4th Avenue North, Suite 104.

Riding the Bus just got easier!

Nashville's MTA schedule has been integrated with Google Maps. Click here to access Google maps from MTA's website. Or, while searching for local directions in Google maps select "public transit" as your transportation option. You may find that commuting to your downtown office, catching a ride to the airport, or running a quick errand around town is easier than you thought.

Ongoing Events

Click here for a list of ongoing happy hours, specials, events and promotions at some of downtown's best places to play!

Continuing Exhibits

Click here to find out what major art shows, museum exhibitions and other displays are currently on view downtown.

Convention Update

Large groups and events that are downtown November 18 - December 2 include Nashville Auto Show (12,000, November 26 - 29) and National Council of Urban Education Associations (325, December 1 - 5). For more information concerning conventions call 259-4782. Click here for a complete listing of Nashville conventions: visitmusiccity.com/conventions/.

More than 145 restaurants, 35 live music venues and

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