Real Estate Market Forecast

Cyberhomes also has a section on their website called Market Forecast that allows home buyers or sellers to purchase reports based on real time market indicators that try and predict where the real estate market over the next 12 months.

Think of it as car fax report, before you buy a car you want one of these I hope to understand the complete history of the car. Well, before you buy a home wouldn’t it be nice to see what might happen in the next year or two before you buy? That’s exactly what Cyberhomes is providing, a report chalked full of helpful information to help home buyers make a better decision.

You can either get a summary report which is a 3 page report or a full report which really dives into market stats and gives a 24-month overview.

Don’t forget to check out the live real time data charts here

The HUD-1 Settlment Statement

To keep it simple, the HUD-1 is a uniformly used form at the time of closing that itemizes all the incoming and outgoing funds at the time of a closing. Back in the day, the year 1974 to be more exact The Real Estate Settlement and Procedures Act (RESPA) was created as a level of protection for consumers to be made aware of all disclosures and charges associated with a real estate transaction.

Breaking Down The HUD-1

The best way to view the HUD-1 is to start on page 2, this where all the numbers come from and are brought to page 1. For the purpose of this post we are just going to start on page 1, I know… why be confusing.

I suggest following along with the dummie mock version here of the HUD-1 Settlement form

Sections A-I

This section is probably the easiest to understand and breaks down everybody involved in the settlement. This is where you will find the names of borrowers and sellers, a long with the lender information, time/date/place of closing, etc.

Section J

This is the summary of the borrowers transaction. Section 100 is the gross amount due from the borrower and includes the sales price, personal property and adjustments made by the seller in advance.

Section 200 covers the amounts paid by or on behalf of the borrower. This is going to be the area where all the funds paid to the buyer will appear. You will see credits for earnest money, taxes that have yet to be paid by the seller, etc.

Section 300 is the total cash to or from the borrower. If the number is negative on line 303 the buyer will receive cash back at closing, if the number is positive, it will indicate the amount of funds needed to close the transaction.

Section K

If the borrower has one, then the seller has to have one just as well which would be the summary of the seller’s transaction. Section 400 looks at the gross amount due to the seller. Along with the contract sales price, personal property and any other amounts of money due to the buyer paid for by the seller.

Section 500 is where you will find reductions in amounts due to the seller. Any liens that have yet to paid off such as existing mortgages, prorated taxes and any utilities left unpaid will be paid.

Section 600 is going to be cash at settlement due to/from the seller. Line 603 usually indicates the amount of cash owed to the seller. It is possible that the seller will have to bring money to closing.

Section L=Settlement Charges

This is the 2nd page of the HUD-1 and this is where all the charges are spelled out and then brought to the first page.

Section 700 outlines all the commissions paid out to the different real estate agencies involved in the transaction. The funds are paid for from the seller.

Section 800 deals with ‘Items Payable In Connection With The Loan’. These items are typically paid for by the buyer, but in the case of the mock  HUD-1, the seller is paying because of seller paid closing costs.

Section 900 are items required by the lender to paid in advance. These fees include interest to be collected at closing, mortgage insurance premiums, hazard insurance premiums and any miscellaneus fees. Once again these fees are typically paid for by the buyer but the seller is paying some in this particular instance.

Section 1000 is all the fees that deposited with the lender in advance. Such as mortgage insurance, hazard insurance and county/city taxes. These fees are usually in escrow and the number of months varies for what a lender can collect. This is to make sure the lender doesn’t collect more than necessary.

Section 1100 has to do with title charges. These are fees associated with the transfer of title, examination of title, title search, title insurance, etc. If there are any attorney fees, they are also listed in this section

Section 1200 is used for government recording and transfer fees. This section is an itemized section for recording deeds and mortgage info.

Section 1300 is used for any additional settlement charges. Most common entry found in this section will be the home warranty.

Section 1400 is the total settlement charges by both the buyer and seller.

There is a final page which is to be signed by both buyer and seller acknowledging that you have reviewed and received a copy of the HUD-1.

Finally! That is everything that is on the HUD-1.

Any questions just ask me here or better yet ask Genevieve from Urban Title.

From the NAR release

The Pending Home Sales Index in the Northeast shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago. In the Midwest the index rose 9.8 percent to 90.4 and is 11.1 percent above April 2008. The index in the South slipped 0.2 percent to 93.0 in April but is 3.5 percent higher than a year ago. In the West the index rose 1.8 percent to 94.8 but is 2.9 percent below April 2008

Happening Locally More

Look no further than the Twin Cities real estate market for signs of life. Home sales in the Minneapolis/St. Paul metro area are 27.2% higher than last year at this time.

Hopefully this trend will continue for the months ahead and prices will beging to some-what stabilize.

Do you think it will continue?

Mortgage rates are sitting at record lows depending which day or hour you are looking at. Oh, and there is also that $8000 tax credit that is sitting out there and just announced the use for a down payment contribution or used for closing costs.

Avoid These Mistakes

No home transaction is perfect but there are some mistakes I see home buyers make when it comes to buying a home. Here are a few:

All foreclosures are a deal

Wrong. Just because the house sold for X amount of dollars a couple of years ago and now is selling for lower. Doesn’t always mean that the house is a good deal. Pleny of properties that are bank owned are starting to get a lot of multiple offers driving up prices when the property might not be worth it. Also noted that most foreclosures might require an extensive amount of work to make livable.

Not Finding a Good Buyer’s Agent

Why not use a buyer’s agent, their services are “free” depending on how you look at it and fiduciary duties only to the buyer. Don’t just run to the listing agent, they have an established relationship with the seller and are probably looking to nab both sides of the sale. They probably don’t have “you” the buyer’s best interest in their hands. Interview a few buyer’s agents and get comfortable with them.

Underestimating Costs of Homeownership

Murphy’s Law states “whatever can go wrong, will go wrong”. Very true when owning a home, they don’t get any more new as they age. Homes require monthly and yearly maintenance not to be overlooked. Make sure to budget accordingly.

Remember Property Taxes

Don’t forget about this added extra. Property taxes are public information and can be found on the county website where the property is located or at the county assessor office. Property taxes will rise or decline over time but typically rise. For the most part property taxes are escrowed into your monthly mortgage payment (if you are lucky you might get some back at the end of year). Simple math dictates a monthly payment by taking the total amount of property taxes for the year and dividing it by 12 for your monthly payment.

Failing to get a Home Inspection

Not to much to say here, spend the money to get a third party home inspection. It is well worth it in the end, the seller “might” forget to disclose some stuff. Here are 10 questions to ask when getting a home inspection.

Add Contingencies

Don’t forget to add contingencies into the purchase agreement, whether they be a financing, inspection or any other contingency that can be thought off. These are your out clauses, if a home doesn’t pass the inspection and no new terms between buyer/seller can be agreed upon, the purchase is cancelled. If you can’t get financing for some crazy reason (job loss, loan falls through, et al), you want to receive your earnest money deposit back and not be obligated to purchase the house.

Finding the right mortgage

So many hours are put into finding the right home, why not spend more time on finding the right mortgage? This is just as important when it comes to finding a home, after all you are going to be tied to for 30 years. Make sure that you are pre-approved and have taken in all the factors when it comes to buying a home in Minnesota.

I’m sure there are more, if you have any pitfalls to add to the list go ahead and add them to the list.

• Twin Cities Metro Area Home Sales Rise
• Buying a home right now
• How to buy a bank owned home foreclosure
• Squatters and foreclosures
• Outrageous Celebrity Homes
• Rebound in September?
• Mortgage Deliquencies Still on the Rise
• 1 in 9 homes sitting empty

If you find any other interesting links, please share below.

Single family homes are selling faster than a year ago, with a big reason being the declines and homes being more affordable to home buyers pushed out of the market a couple of years ago. Condos and townhomes are moving but not at the pace of last year.

Get the full report on April’s Housing Supply Outlook

So the Homeowner Affordability and Stability Plan will help borrowers that have good repayment history but are otherwise not able to refinance because they are now currently “underwater” on their mortgage. Only Fannie Mae and Freddi Mac mortgages will qualify for the program.

The plan is broken into a few different areas. Home Affordable Refinance aims at helping homeowners who cannot refinance out of their current mortgage because they don’t have the necessary equity which is 80%. The Home Affordable Modification seeks to set industry standards in loan modifications.

Who Qualifies

You qualify if:

• Your loan was originated before January 1, 2009
• You will need to sign IRS Form 4506 T, provide fully document income, two years of pay stubs, recent tax returns, financial hardship affadavit
• Must be a primary residence. Sorry investors and boarded up houses
• First lien principal loan amount up to $729,750
• New loan cannot be more than 31% of borrowers monthly gross income
• Loans can be modified thru December 31, 2012
• Only once can the loan be modified

The overall target for homeowners being help is in the ball park of 7 to 9 million.

And for the rest

For loan servicer’s, a “pay for performance” is also thrown into the mix. Look at it as an incentive for servicers to make a better attempt to modify the loan of a troubled borrower. Loan servicers will get $1000 upfront for a loan that fits the criteria, as well as another $1000 if the loan is in good standing three years down the road. Loans apparently can start being modified immediately.

There also doesn’t seem to be a wink at trying to influence that mythical 4% interest rate. Looks like the government will let the free market figure that one out or until another intervention occurs again. This is for homeowners that need help, not want lower rates.

The announcement still lacks certain transparency for who, what and how this is going to get accomplished. Oh well, another wait is in order I guess.

Here are some links:

Homeowner Affordability and Stability Plan HUD Site

US Treasury Press Release

Check Your Lender’s Website

Financial Stability Gov

1. 1500 Bohns Point Road , Orono, MN 55391 List Price $5,490,000 Sold Price $3,175,000
   
2. 5070 Highview Place , Greenwood, MN 55331 List Price $1,980,000 Sold Price $1,800,000
3. 222 2nd Street SE #901, Minneapolis, MN 55414 List Price $1,299,000 Sold Price $1,600,969
4. 5 Island Road , North Oaks, MN 55127 List Price $1,890,000 Sold Price $1,515,000
5. 793 Ferndale Road N , Orono, MN 55391 List Price $1,875,000 Sold Price $1,500,000
6. 1617 Franklin Avenue W , Minneapolis, MN 55405 List Price $1,550,000 Sold Price $1,427,000
7. 101 Main Street NE #5, Minneapolis, MN 55413 List Price $1,590,000 Sold Price $1,250,000
8. 4713 Townes Road , Edina, MN 55424 List Price $1,295,000 Sold Price $1,225,000
9. 11912 Tapestry Lane , Minnetonka, MN 55305 List Price $2,695,000 Sold Price $1,200,000
10. 14702 Williston Glen , Minnetonka, MN 55345 List Price $1,850,000 Sold Price $1,200,000
    

Slow month on the luxury front of higher end home sales. So much so a home that was on the market for 1400 days finally sold. A new construction builder also took some hits by dropping the original price tag over $2 million, ouch! A lot of other big price drops as well.

A lot of problems lie with REO Agents that have bank owned homes. Just because the bank is your client doesn’t mean that they shouldn’t deserve the same representation as traditional sellers. Taking two photos of a drive by BPO 6 months earlier and using them on the MLS doesn’t serve any purpose. If only they knew…

So here’s a simple list

1. Enough if the cheap lock boxes where the combonations are the same on ALL the listings throughout the Twin Cities Metro
2. ‘Move in Ready’ last time I checked didn’t mean a home with out major appliances.
3. I know 10 pictures is a lot to ask for. Everybody knows that you are trying to get people in the door. C’mon now, quit wasting everybody’s time
4. One picture of wild life in the backyard is going to make the buyers of Deliverance
5. If showing is by appointment only, seller’s agent must be present. Not to many buyers are going to be accommodating to that.
6. Update the listing: Buyer’s Agent Selling bonus by “X” date. The deadline has come and gone.
7. If the remarks say “This One Won’t Last” and 90 days has gone by, see 6
8. Last time I check minor TLC meant paint and touchups, not complete gut and rehab of the house!
9. Might want to make breathing masks readily available
10. Lets keep the sign riders to a minimal, scraping the ground is not good!
11. Update the status accordingly, if the property is Sold then it is sold, if the property is Pending then it is pending and if the property is Active then it is active. Not to hard to comprehend.
12. LAY OFF THE ALL CAPS! I MEAN REALLY

This is just the tip of the iceberg, I may post more as I see or remember them.

House Hunters is seen across the country and provides great insights into the home buying process.

What to consider

If being on House Hunters is something that interests you, then here are some things to consider:

• A time commitment of 4-5 days allowed for shooting
• Be ready for fast paced experience
• Time frame is spring to early summer for shooting
• 30 mile radius of the Minneapolis/St. Paul metro area is preferred
• Comfortable on camera
• Appearance and Location release signoffs
• This is the real deal, you will be buying a home!
• Expect FUN

The Episode

The show focus on you searching for homes that you are interested in. Three homes will be picked to view with you picking  your favorite. Areas of interest and home descriptions will be discussed along with your current living arrangements. Be ready to discuss your likes and dislikes about each property. Brutal honesty is required (-:

If you haven’t seen an episode before, check this out to get an idea of what each episode of House Hunters includes.

If you would like more information about appearing on the show or if this something that might interest you, then contact me here for more information and we can discuss this opportunity further.

You must be ready to purchase a home because that is the point of the show