Utah's Economy is on the Rise

Sales of existing homes and new homes are increasing rapidly in Utah and it is becoming increasingly difficult to find a well priced home below $250,000 without an existing offer. The improving market is boosting buyer confidence which in turn fuels more home buying. Investors are seeing the changing market and the pent-up demand, and are moving to take advantage of the opportunity, seeing rents on the rise and the potential for significant price increases over the long term.  However, it is becoming increasingly more competitive to find properties. A recent report suggests that loosening mortgage standards, including increasing mortgage-to-value ratios and mortgage-to-income ratios along with improving credit availability, is helping to fuel the increased purchasing.

Excellent Summary of Real Estate Tax Benefits

Click this link for the article summarizing the big tax benefits of owning real estate

US Real Estate Market Shows Strength

Click this link 
for the article in the Wall Street Journal that describes how for the first time since 2005, investment in residential real-estate, including home building and renovation, has contributed to U.S. economic output for the past three quarters.

Should I Buy or Rent?

Click this link
for the article from CNN Money on why home buying is much cheaper than renting in 98 out of the 100 major US real estate markets.

Cost of a Home More Important than Price

Click this link for this excellent analysis of cost which includes the current mortgage rate. Higher mortgage rates have a dramatic impact on cost, and as economic growth continues at a faster than expected rate, there is less of a chance that the Fed will intervene to lower interest rates.

Short Sales Should Go Quicker Now

Click this link
for the full article on how the new deadlines will expedite short sales as well as give the banks more of an incentive to accept short sales.

Pressure on Banks to Expedite Short Sales

Click this link for the full article on how the 5 largest mortgage servicers have new and faster guidelines to respond to short sale requests.

Capital Economics Expects Housing Crisis to End Soon

Click this link for the full article on why Capital Economics expects the Housing Crisis to end this year.

Salt Lake County Home Sales Update

January Home Sales Rise 30%
  Sales of previously-owned homes in Salt Lake County in January rose 30 percent compared to January 2011, according to the Salt Lake Board of Realtors. In January, there were 750 home sales (all housing types) compared to 575 home sales in January 2011.
  January was the eighth consecutive month of year-over-year home sales increases.
"The number of homes listed for sale is falling dramatically," said Donna Pozzuoli, President of the Salt Lake Board of Realtors. "In fact, in the fourth quarter of 2011 listings reached a 14-year low. With declining inventories, we expect home prices to stabilize this year."
  The median home sales price (all housing types) in January fell to $171,750, a 12 percent decrease compared to a median price of $195,000 in January 2011.
  The inventory of homes for sale in Salt Lake County in January fell to 5,245 units, down 29 percent compared to 7,410 units in January 2011. Based on current sales trends over the past year, there is a 5.4-month supply of housing inventory, down 37 percent compared to a 8.5-month supply of inventory in January 2011. A five- to six-month supply of housing inventory is considered a normal market.
  In January, pending home sales (homes under contract) rose to 994 units, a 39 percent rise compared to 714 units in January 2011.
 

Short Sale Tips

Short sales have become the only way out for some sellers who owe more on their mortgages than their houses are worth. For struggling borrowers, it's a chance to avoid foreclosure. While helpful, short sales can be stressful, time-consuming and may lead to harsh consequences if not done properly. Many sellers think the biggest challenge they face in a short sale is persuading the lender to take a haircut and allow the property to sell for less than the mortgage balance. That's only the first step.

Here are five tips you must know when short selling your home.

If you needed heart surgery, would you put your life in the hands of a surgeon whose first surgery would be on you? Probably not. The same applies to your financial life. Hire a real estate agent experienced in short sales, says Daniel Gomez, a board member at Neighborhood Housing Services of the Inland Empire in San Bernardino, Calif. He also is a real estate agent. Ads of real estate agents who claim to be short-sale specialists are widespread these days. But some of these agents have closed only a handful of short-sale deals, says Gomez. Many have taken short-sale courses and are certified in selling distressed properties. That's not enough; certifications help, but nothing counts more than experience, Gomez says.  "Interview agents, ask how many short sales they've closed and ask to talk to some of their clients," he says. A short sale is a time-consuming transaction and can take months to close. You want an agent who will stay on top of the game until the deal is closed.

Underwater sellers are so anxious to get rid of their mortgage payments, they often don't think about what comes after the sale. Then, months or even years later, they receive a collection letter for the difference between what the house sold for and what was owed on the mortgage. Laws vary by state, but many states allow lenders to go after that balance once a short sale or foreclosure is completed. That's why it's crucial for borrowers to understand whether the lender agrees to waive the deficiency, or the balance that will be left on the loan after the sale, says Howard Ullman, an attorney at Family Counseling Law Firm in Deerfield Beach, Fla.  "This needs to be discussed verbally and represented in documents," he says. "It shouldn't come as a surprise."

One way to avoid a deficiency judgment is to do the short sale through the Home Affordable Foreclosure Alternatives program, or HAFA. Lenders who approve short sales through this federal program have to release the borrower from a potential deficiency judgment.

Lenders are not obligated to approve HAFA short sales. They may choose to do the short sale based on their own internal rules and the guidelines set by loan investors. In that case, it's really up to the lender to decide whether it will pursue the deficiency against the borrower.

When negotiating a short sale, many lenders don't voluntarily offer to release you of liability on the remaining balance of your loan -- at least not for free. But you can ask to negotiate a waiver. "I've never had a lender refuse to negotiate a settlement" to waive the borrower from deficiency, says Patty Da Silva, a real estate agent certified in distressed property assets and owner of Green Realty Properties in Davie, Fla.

Some lenders may ask you to sign a promissory note for at least a small portion of the balance, usually cents on the dollar, or they may ask for a lump sum. Sellers often are outraged when first presented this settlement offer, Da Silva says. "The sellers sometimes forget they actually borrowed that money," she says. In many cases, it is usually worth paying upfront to avoid future headaches. "There is a price attached to the waiver of deficiency, but most of them are very tiny," she says.

Real estate agents who are experienced in short sales can coordinate the transaction with the bank and tell you what to expect of the process, but remember they are not lawyers.

"Most of the people who do short sales are doing it through the Realtors or people who claim to be short-sales specialists," Ullman says. "But there are many issues that borrowers need to discuss that cannot be discussed with a short-sale specialist." Those issues range from potential tax implications to protecting other assets the borrower may own if the lender tries to collect the balance of the loan in the future. If you don't understand the contract you are signing or the potential consequences of a short sale, you should consult with a lawyer.

If you are thinking about short selling your home, don't stop paying your homeowners association dues. The fees can turn into a snowball and kill the sale, even if the buyer is willing to pay for the delinquent dues at closing. "In short sales, there are a few problems that money cannot fix," Da Silva says. In a regular sale or even with foreclosures, the seller or the bank pays any past dues owed to the HOA at closing so the buyer gets clear title of the property. But in a short sale, the seller's lender wants to get every penny out of the transaction, Da Silva says. She says it is so crucial for the seller to stay current on HOA and condo dues that she refuses to represent a seller who won't keep up with the payments.

"Plus, you want to make sure the association is able to maintain the common areas so your house is saleable," she says. "A short-sale property needs to be maintained. The power needs to be on; the grass needs to be cut. You don't want your home to look like a foreclosure."

~Article from a discussion by Polyana da Costa~

Home Builders Announce Housing Finance Reform

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for the full article on the housing finance reform plan announced by the NAHB, the National Association of Home Builders.

Spring Cleaning Advice

Click this link for great advice on how to make Spring Cleaning easier and better.

Economy Grew at a Faster Pace at end of 2011

Click this link for the full article on how the economy grew at a healthy 3 percent rate in the last quarter of 2011, reflecting stronger economic momentum, with job creation, manufacturing activity and consumer confidence making solid gains. Incomes are higher as well as the rate of savings. Additionally, rising stock prices could lift sentiments further.

Mistakes that Sellers Can Make

Click this link for the full article on how poor decisions made by home Sellers can sabotage the sale of their property.

Utah Housing Market Update

               (Information from the meeting at the Legislature during Realtor Day)
   Utah's housing market is improving as more people buy homes. Utah home sales in 2011 were the highest they've been since 2007. Utah Realtors sold nearly 33,000 homes in 2011, up nearly 9 percent compared to 2010 sales. Home sales have been on the rise since June and are expected to continue the upward trend.
   Pending sales, which measure future home sales activity, were up 11 percent for 2011 compared to 2010. Jim Wood, of the University of Utah's Bureau of Economic and Business Research, forecasts home sales will rise 15 percent in Salt Lake County in 2012.
   The sales increases are the result of increased home-buyer confidence and improved employment conditions. The Utah Association of Realtors Housing Affordability Index was at its second-highest level on record in December while Fannie Mae reported that more consumers believe that home prices will rise within the next 12 months. Mortgage rates also remain at record lows, with Freddie Mac reporting that the average rate on a 30-year fixed mortgage in January was the lowest on records. Another positive influence on the housing market is the fact that Utah is in the top five states for employment growth.
   Together, these factors have pushed down housing supply. For the past 10 months, inventory declines have been in the double digits, with the number of active listings falling for more than a year. The number of homes on the market has not been this low since March 2007, and inventory is being absorbed at its quickest pace since July 2007. In December, it would have taken 7.2 months to sell all of the homes on the market, significantly lower than last year's 10.5 months.
   The tighter supply and increased demand should help put upward pressure on home prices. A report from Fiserv, with analysis from Moody's Analytics, says Utah home prices are set to rise 1.5 percent by the end of summer 2012 and more than 7 percent during the subsequent year.
We asked the Legislature to continue to support policies that will encourage this recovery, including actions that will promote the economy, job creation and housing affordability.