According to new research and a Coldwell Banker Real Estate survey, nearly 25% of married couples ages 18 to 34 bought a home together before they were married. By contrast, just 14% of married couples ages 45 and older said they purchased a home before saying “I do.”
Psychotherapist Dr. Robi Ludwig says that millennials simply have a different attitude when it comes to commitment. She adds, “People are very commitment oriented, but millennials are much more pragmatic. I think millennials are saying that if we want to have the life we want, we need to make smart decisions early on. The home becomes the new engagement ring—and in some ways, the new wedding.”
John Braun, a real estate attorney at Thomas Law Group, has some additional advice for millennials who might be considering the purchase of a home together before they get married. He points out that purchasing a home together without being married offers equal ownership, but not joint ownership. Incidentally, if one partner passes away, their shares of the home will be transferred to their heirs instead of the other partner.
He adds, “When I am not scaring people away from [buying a house before marriage] altogether, I usually recommend that they have an agreement that governs their ownership interests whatever happens. This kind of contract sets forth the contributions made by each party, establishes a right of either party to demand that the property be sold and makes a bunch of other decisions by agreement in advance that are impossible to make by agreement when the parties hate each other.”
CreditSmart was created with new and existing borrowers in mind, offering an online portal where they can learn more about building personal credit, creating a robust savings account, and making all around better financial choices based on their personal situations.
Christina Diaz Malone, VP of corporate relations and housing outreach for Freddie Mac, said, “Our new online CreditSmart tutorial is a stepping stone to homeownership, especially for working families who are unsure how to start household budgets or build the personal savings and strong credit for the future. Today’s announcement underscores Freddie Mac’s commitment to help America’s next generation of borrowers achieve long-term financial stability.”
Thus far, more than 3,000,000 homeowners in 44 states have taken advantage of CreditSmart. The curriculum is available via nonprofit organizations, lenders, schools, churches, and other outlets.
What makes CreditSmart so effective is that the online tutorials and modules are convenient and can be accessed by borrowers when they see fit. Curriculum topics were designed with current and potential borrowers in mind, and include everything from obtaining a mortgage and budgeting to closing a loan. Additionally, current homeowners can work on other modules that address topics like avoiding foreclosure and maintaining their home.
The Home Affordable Refinance Program, also known as HARP, has been extended for another two years by the Federal Housing Financing Agency (FHFA). The original program was due to expire at the end of this year, but will now be available for interested borrowers until December 31, 2015. The FHFA will continue to monitor the program, which assists severely underwater homeowners with programs to help them avoid foreclosure.
According to FHFA Acting Director Edward J. DeMarco, “More than 2 million homeowners have refinanced through HARP, proving it a useful tool for reducing risk. We are extending the program so more underwater borrowers can benefit from lower interest rate.” FHFA says they’re working on a campaign to spread the word about the extension so that more borrowers can take advantage of the program.
In order to qualify for HARP, there are certain eligibility requirements that a borrower must meet. Here’s an overview from the FHFA regarding the selection requirements:
- The loan must be owned or guaranteed by the GSEs
- Loans must have been sold to the GSEs on or before May 31, 2009
- The mortgage can’t be one that was previously refinanced under HARP unless it is a Fannie Mae loan that was refinanced under HARP from March to May, 2009
- LTV must be greater than 80 percent
- Borrower must be current on their mortgage payments with no late payments in the last six months and no more than one late payment in the last 12 months
Don’t have a room with a view? Make one with plants! Plants are the perfect way to beautify interior space. They’re inexpensive, easy to obtain and provide instant gratification. All it takes is a little imagination to transform a lackluster room into a striking design statement.
The first step in decorating organically is evaluating your space. Plants can go anywhere. They live on ledges, hang from ceilings and fill empty voids. Foremost considerations are lighting and room size. If you have a miniscule kitchen with southern exposure, consider an herb garden on the windowsill. It not only adds a vivid pop of greenery, it delivers something equally pragmatic—fresh herbs for cooking!
The second step is what to house them in. Keep it affordable by resurrecting containers like vases, pots or ceramic jars. Just about anything is fair game as a plant container – from glass water jugs (great for terrariums) to watering cans or birdcages (excellent for training climbers like ivy).
Finally, determine the best plant for the room. Need a big impact? Go for a larger specimen like a Heart Leaf Philodendron or Rubber Tree that sits in a floor container. Have a vacant corner too small for furniture? Consider a hanging basket filled with English Ivy, Pothos or other variety that adds a note of elegance. Make sure to find a plant that will thrive in the lighting exposure your room provides.
Plants not only add style and flair, they also improve indoor air quality. An important thing to remember, however, is that some plants are poisonous. If you have children or pets within arm’s reach (or paw’s reach), ensure houseplants are non-toxic. Learn more about the power of plants at these links: http://www.ivillage.com/top-10-indoor-plants/7-a-258925
If 13 and a half months sounds like a long foreclosure timeline, try more than one year and nine months on for size. Recent reports from two major sources confirm that drawn out foreclosures have been the norm for 2013’s first quarter.
As reported on DSNews.com, the online foreclosure marketplace RealtyTrac recently revealed that the average time to foreclose went up in 39 states in the first quarter of this year compared to the previous quarter. The rise from 414 days to complete a foreclosure in the previous quarter to 477 days in the first quarter is, RealtyTrac says, likely due to continuing foreclosure prevention efforts. The new number was the highest average since the first quarter of 2007.
Meanwhile, Moody’s Investor Services published in their Servicer Dashboard that foreclosure timelines increased for all servicers in the fourth quarter. Known to have a high concentration of its loans in judicial states, GMAC had the longest foreclosure timelines across all categories of loans. Bank of America however, which has been transferring its non-performing loans, has experienced shorter foreclosure timelines as of late.
Overall, REO timelines were flat, though California and Florida had shortened theirs in the fourth quarter, and Moody’s predicts REO liquidation timelines will slowly improve. They also made the correlation of a strong Ocwen presence in those states.
Moody’s also stressed that to ensure accuracy in the loss mitigation process for residential mortgage-backed securities, servicers should update their net present value (NPV) model inputs using the most recent reliable information available, including property valuations, home price trends, REO discounts, and borrower’s income and willingness to pay.
As Earth Day, April 22nd approaches, it reminds us that we reside on a living planet that requires nurturing care—just like a business. Americans have grown increasingly eco-conscious and supportive of conservation efforts, providing real estate professionals a platform to brand themselves “eco” by integrating green initiatives into their business. Here are some worthy considerations:
- Conserve on paper usage by moving over to online transaction management
- For necessary paperwork, use recycled paper
- Use environmentally friendly cleaning products
Property Listings & Showings
- Reduce paper waste by substituting flyers with a QR code on your sign–smartphone users can scan it and go directly to your listing to review photos and pricing information
- Work with homeowner to identify areas of their home that are green; then leverage this in marketing materials. Example: solar panels (lower utilities), xeriscaping (minimizes water usage), ENERGY STAR appliances, etc.
- Consider driving a hybrid or electric vehicle – saves on gas, lowers emissions and tells your clients you care about the environment
Implementing green measures in your business may result in ROI such as reduced office expenses and fuel costs, but it’s what can’t be measured that may matter the most – branding yourself and your company as advocates of Planet Earth.
2013 has seen the international luxury real estate market soar, and it continues to sizzle thanks to its immunity to the economic and political issues that have a bigger impact on the general housing market. According to a report from Christie’s International Real Estate and their new Christie’s International Real Estate Index, the international luxury real estate market is strong and getting stronger.
The top 10 property markets in the world right now include London, New York, Hong Kong, Paris, San Francisco, France’s Cote d’Azur, Toronto, Dallas, Los Angeles, and Miami. Christie’s amassed their list based on prices per square foot, record sales prices, the number of luxury listings relative to population, and the percentage of non-local and international buyers.
The report said, “Except where there is government intervention luxury residential real estate values will likely follow luxury goods and not the general housing market, and are therefore poised to increase in many of the cities studied in 2013. This is particularly true as (high-net-worth individuals) turn their luxury investments toward non-consumables and experiential luxury products that have lasting value.”
What’s more, the report indicates that there are more billionaires worldwide now than there were pre-recession. And since so many wealthy buyers have seen their local real estate markets tank because of the global economic uncertainty, many feel more comfortable putting their money in international cities versus their own.
According to the report, “Globalization, economic development, wealth deposits, and technology attract HNWIs to the key global urban centers, where knowledge, capital, and culture intersect.”
If you’re on the hunt for a new home, you know too well that there are more interested buyers than there are homes to go around. Around the country, inventory issues continue to be a challenge, and levels dropped to 1.82 million homes nationally at the end of 2012. That’s an impressive 21.6% drop year-over-year!
Home prices are on the rise, especially as we move into the busy spring and summer buying periods, but it has a lot of buyers wondering, Where have all the homes for sale gone? Here’s a snapshot of what is driving current inventory shortages.
- Reluctant Sellers: The housing recovery certainly has legs under it, but close to 22% of homeowners in the U.S. still owe more than their home is worth. As such, these homeowners are waiting for values to rebound before they put their homes up for sale.
- Underwater Home Owners: During the downturn in the economy and the recession, a lot of owners lost a tremendous amount of equity in their homes. For them, it just doesn’t make sense to sell right now, and they’re waiting for the value of their home to come back up so they can afford a down payment on a home that’s bigger.
- Cash Investors: For months, investors have been pestering buyers by showing up with fistfuls of cash and swooping homes right out from under them. Most buyers rely on traditional financing to purchase a home, and they’re having a hard time competing with all-cash investors. These same investors are purchasing homes and then converting them into rentals because that market is performing so well, taking even more homes off the market for purchase.
- Foreclosure Slow-Down: Foreclosed homes dominated the landscape for years, but now banks are focused more on short sales and loan modifications. It’s better for them to strike deals with homeowners this way instead of foreclosing, but interested buyers are left without a lot of options.
- Construction Drought: After the housing market fell apart, home builders pulled back on construction dramatically. In fact, between 2009 and 2011, housing starts were at record lows, and fewer new homes has contributed to the lack of inventory.
If you’ve ever slipped up and said “Freddie Mae” or “Fannie Mac,” you may have been onto something. As reported in the Los Angeles Times earlier this month, we may be looking at the beginning of the end for the two giants of mortgage financing.
Edward J. DeMarco, acting director of the Federal Housing Finance Agency, has announced that the federal regulator for Fannie and Freddie plans to create a “new business entity” that will take over duplicate functions of the nation’s two biggest mortgage backers. The merged functions of this new, as-yet-unnamed company would include packaging home loans owned or guaranteed by the companies into mortgage-backed securities, providing disclosures for the securities and paying investors, DeMarco said.
The new company would be owned and funded by Fannie and Freddie but would be independent and have its own chief executive and board chairman — all part of a move the Los Angeles Times called “the first step toward possibly shutting down the taxpayer-rescued firms.”
As reported in a separate Los Angeles Times article in February, the Obama administration and Congress want to shut down Fannie and Freddie and reduce the government’s role in the mortgage market. The long-competing companies, now 80% owned by taxpayers, have received about $187 billion in bailout money as of December, the latest available figures. Still, some fear closing their doors too quickly or too soon would further impair a fragile housing market. Key Democrats in Congress have even been pushing the duo to reduce mortgage payments and lower the loan amount owed for struggling homeowners as the FHFA presses on with its mission.
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According to Challenger, Gray & Christmas, Inc., a nationwide outplacement firm, previous underwater homeowners could relocate in an effort to find jobs. The firm says that 2013 could see a massive relocation surge because so many homeowners are finally able to list their homes for sale once again and move.
John A. Challenger, the firm’s CEO, adds, “One factor that has kept unemployment rates high has been the inability of underwater home owners to relocate for employment opportunities. With home prices bouncing back, even those who may now simply break even on a home sale might consider moving to a region where jobs are more plentiful. This could spark a more rapid decline in the unemployment rate over the next year.”
Negative equity continues to decline as home prices improve around the country, and Zillow notes that 1.9 million homeowners were absolved of their negative equity in 2012. Los Angeles, Riverside and Phoenix were among the top metros where homeowners were freed from negative equity last year.
Challenger said, “It is likely that employers in these low-unemployment regions are actually struggling to find available workers with the skills need to fill job openings.” And that’s music to the ears of many skilled workers around the country who have sat idle during the recession hoping for a paycheck.