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After a close brush with the deadline, Congress has passed an extension of the Homebuyer Tax Credit closing deadline, the Homebuyer Assistance and Improvement Act (H.R. 5623). The extension applies only to transactions that have ratified contracts in place as of April 30, 2010 that have not yet
closed. The legislation is designed to create a seamless extension the new closing deadline for eligible transactions is now September 30, 2010. There is will be no gap between June 30 and the date the President signs the bill into law.

NAR worked closely with Congressional leaders on both sides of the aisle to enact this important legislation. Extending the Tax Credit Closing deadline will help provide additional stability to real estate markets across the nation.

For additional information on the extension visit www.realtor.org/government_affairs

Additionally, the United States Senate has passed the National Flood Insurance Program Extension Act of 2010 (H.R. 5569) an extension of the National Flood Insurance Program until September 30, 2010. This will allow transactions to move forward. The bill is retroactive and covers the lapse period
from June 1, 2010 to the date of enactment of the extension.

For more information on the flood insurance program visit www.realtor.org/government_affairs




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The Federal Reserve Board met this week and even though the markets were not expecting surprises to emanate from this meeting and none surfaced, an interesting article was released by CNN/Money this past week. The article asks an important question–is the Fed out of bullets? By way of background, we have been recovering from the deepest financial crisis since the Great Depression. The government, led by the Fed, has been firing on all cylinders ever since. In our opinion, they started a bit late and that became part of the problem as we were convinced the markets could survive what was then termed a 'sub-prime crisis.' Well, it became much more than that. Since this late start, the Fed has been doing just about everything besides washing America’s dishes. The next question arises–what if this medicine is not enough? The Fed already moved short-term rates to zero and purchased trillions of dollars of mortgage and Treasury securities while the government took over housing agencies Fannie Mae and Freddie Mac as well as doling out tax stimulus dollars like they were going out of style. What if the economy does move back into recession and more bullets are needed? We say perish the thought. From day one, this has been a crisis of confidence. The public and the markets must be convinced that the economy will recover. We must not think or speak negative thoughts. It may take some time, but employment will grow and as employment grows, Americans will purchase houses and cars. Then our worry will be when will the Fed raise rates and how will we pay for all the bullets we have spent. Meanwhile, today we have an unprecedented opportunity to take advantage of bargains courtesy of the Federal Reserve Board

Mortgages are cheaper today than they’ve been in a half-century. Rates are at their lowest since the mortgage company began keeping records in 1971. The last time they were any cheaper was the 1950s, when most long-term home loans lasted just 20 or 25 years. Rates have fallen over the past two months as investors have become nervous about Europe’s debt crisis and the global economy and have shifted money into safe Treasury bonds. The demand has caused Treasury yields to fall. Mortgage rates track those yields. Lower rates and low home prices have brought affordability to levels not seen for years and increased demand for refinances. Source: Associated Press Companies are changing and expanding relocation policies to accommodate employees who otherwise are refusing transfers because they don’t believe they will be able to sell their homes for enough money. Worldwide ERC, a trade organization for human resource associations that oversee, manage, or support employee transfers, surveyed 129 companies in 2009. The survey found: 28 percent of employers are requiring transferred employees to list their homes within a reasonable range based on an appraisal in order to qualify for assistance; 26 percent have added incentives for employees to find their own buyers for their homes; 26 percent have extended the time they will pay for temporary living assistance; 20 percent have added a requirement that employees use selected real estate professionals to market their homes; 17 percent have added loss-on-sale assistance. Source: The Atlanta Journal-Constitution

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Jobless Recovery

We have been watching the markets and there is no doubt that they are speaking loudly. Since peaking this spring, the stock market is down approximately 15.0%. Oil prices have also fallen within the same range. Meanwhile, rates have moved down to the levels seen right after the financial crisis hit the markets some 18 months ago. What are the markets saying? The economy is slowing down. Some are still predicting a 'double dip' recession and certainly the market reaction is strong enough for some to draw that conclusion. One thing is for sure, creating private sector jobs at under 100,000 per month is not strong enough to help us recover from the loss of millions of jobs we experienced during the recession. Job growth must be stronger. Is this possible? Last week we talked about the Fed being out of bullets. There is no doubt that removing the housing tax credit as well as other fiscal stimulus is contributing to the current slowdown. States and local governments are cutting jobs because aid from the Federal Government is waning. However, don’t think that the entire stimulus has disappeared. Many aspects of the stimulus package will be hitting this summer as pointed out in a recent article from CNN/Money: 'This summer will be the peak of the $787 billion stimulus program in terms of creating jobs and pumping money into the economy. In fact, the Obama administration is calling it the Summer of Recovery because more than 30,000 miles of highways are being improved, more than 2,800 water projects have been started and 120,000 homes will be weatherized.' We obviously could use the work. In the meantime, record low rates on home loans should con tinue to stimulate housing in the wake of the tax credit’s expiration The National Association of Home Builders (NAHB) is reporting that after growing in square footage for nearly three decades, the average floor space of the single-family home is now reducing. In 2007, the average single-family home in the United States peaked at 2,521 square feet. That number did not vary greatly into 2008. However, according to a 2009 report from the Census Bureau, it’s now at an average of 2,438 square feet. 'The decline of the early 1980s turned out to be temporary, but this time the decline is related to phenomena such as an increased share of first-time home buyers, a desire to keep energy costs down, smaller amounts of equity in existing homes to roll into the next home, tighter credit standards and less focus on the investment component of buying a home,' said NAHB Chief Economist David Crowe, in a statement . 'Many of these tendencies are likely to persist and continue affecting the new home market for an extended period.' The report adds that fewer bedrooms and bathrooms are being built into houses. The Census numbers are based on housing completions, the NAHB adds. Source: HousingWire Foreclosures accounted for a third of all sales — and sold at a nearly 30% discount — during the first three months of 2010. According to a new report from RealtyTrac, the marketer of foreclosed properties, 31% of all sales were foreclosures. And homebuyers purchasing those properties paid a whopping 27% less, on average, compared to sales of non-distressed homes. These foreclosure sales include properties sold in short sales or after a bank repossession, known as REOs in industry terms. It does not include transfers from borrowers to banks, as in a sheriff’s auction. REOs, those homes already taken back from borrowers, commanded lower prices than short sales and other pre-foreclosures. The average REO sold for 34% less than conventional sales while pre-foreclosures averaged only 15% less. Part of the reason for the bigger price cut for REOs is that many of them come to the market in poor condition, t heir previous owners either unable to or unwilling to maintain them. Source: CNN/Money Home owners who have been trying to sell their properties for a year or more might consider lease or a rent-to-own option. A lease option agreement gives the tenant the option to buy at a predetermined price for a rent that is slightly higher than market. In a lease purchase, a buyer commits to buying the property. In exchange, the seller credits a percentage of each payment toward the purchase price. Either arrangement is likely to attract serious renters who would like to buy the property if they can. In exchange, they’ll take good care of it. Negotiating these agreements can be tricky, and the owner should always get help from a real estate attorney. Source: The Wall Street Journal


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Articles and commentary are provided for general information only and should not be relied on as legal or financial advice. Opinions expressed herein do not necessarily reflect the opinions of Franklin American Mortgage Company.

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renoVate

First Choice Custom Homes is proud to announce the launch of its new renovations business complete with a new logomark, marketing materials and web site. The Company intends to capitalize on the strong wave of renovation work among homeowners looking to improve their home's value.

"Re-investing in your home is a wise choice," says Brad Thompson. "Our new renovations business, renoVate, leverages our experiences and resources in home building by offering homeowners a cost effective, timely and quality-filled solution to building from the ground up."

Featured Home - River Reserve
This grand home located in the beautiful neighborhood of River Reserve showcases many of the custom qualities that First Choice Custom Homes has to offer.

Gorgeous walnut hardwood floors glisten throughout the home. Decorative ceiling treatments and stained wood interior trim give the home an upscale rustic feel. The gourmet kitchen features stone accents and custom cabinetry.

Community Spotlight - Alexander Farms
Conveniently located off West Georgia Road in the Simpsonville area, this 19 homesite community features beautiful estate sized lots ranging from 1 acre to 1.73 acres. First Choice Custom Homes already has Lot 9 reserved for a custom home build. Contact us today to build your dream home!

This exquisite Frank Betz house plan is just one of the many homes First Choice could build for you at Alexander Farms.

Welcome Neighbors
Our latest First Choice homeowners are Jim & Joyce Horn in River Reserve.

Greenville Earns National Recognition: 5 Greatest Places to Retire (Fortune Magazine, June 13, 2010)
South Carolina has turned into the home of the halfbacks, folks from the Northeast who retire to Florida and then - because of heat, high insurance premiums, hurricanes, or all of the above - move halfway back up north. Greenville and its fellow South Carolina cities still give residents a change of seasons and a stable real estate market that never experienced sky-high prices during the bubble: Greenville has dropped a relatively modest 13% since its peak and has another 1% to fall.

One of the biggest draws for Greenville residents is its downtown, which has undergone a 30-year revitalization plan. (Its Main Street has been recognized by the National Trust for Historic Preservation.) "It is so darn cute," says Lori Sperry, 50, who recently bought a retirement home in the Greenville area. A growing number of retirees are buying condos within walking distance of downtown's stores and nearly 100 restaurants. Those looking for a city culture can take advantage of Greenville's proximity to Charlotte and Atlanta.

First Choice Custom Homes
136 Reserve Drive, Piedmont, SC 29673
Brad Thompson: 864.505.2252
Cindy Thompson: 864.505.9845
email: 1stchoicecustomhomes@charter.net
www.1stchoicecustomhomes.com <http://www.1stchoicecustomhomes.com

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