Hello Bloggers – thanks for stopping by. Today, I’d like to pass along some encouraging and FACTUAL information concerning our local housing market written by my friend Stacy Anfindsen. Stacy has been tracking local housing statistics for years. He is one of the main sources of information we check before recommending a home. Enjoy a “positive” look at the local Raleigh and Cary real estate market. Here is Stacy’s comments:
In response to the main headline in the 10/27/08 N&O, I would like to present some data to contradict the headline, which is yet another attempt to scare local readers by using data from selected national sources. The writer states five reasons; crashing home prices, investor speculation, complex investments, job losses and repeat delinquencies. I will respond to each of these to provide some local perspective.
1). When analyzing our market, I look at data from the Raleigh, Cary and all counties that make up the Triangle, including Wake, Durham, Orange and Johnston.
Within this market, the average closed price of all housing is up 8% and the average closed price of resale housing is up 6%. House price appreciation, which compares the two most recent sales prices of the same house , is an area where the Triangle outperforms the national market. Our current rate of house price appreciation in the Triangle is just over 4%. This rate beats the state (+3.6%) and national rates (4.5%).
2). The Wake County Revenue Department has reported +/‐ 21,000 closed sales within the past 13 months. Roughly 5% of these sales were purchased by buyers from out of town, a huge difference compared to the 20% rate nationally.
3).It is almost impossible to track what percentage of local purchases were made via the sub prime loan mechanism. Per the FHFA mortgage metrics survey for the second quarter of 2008, 17% of all outstanding mortgages in the U.S. are rated as sub prime. Therefore it would be hard to argue that a majority of house purchases were made via this mechanism.
4).Job losses are real both nationally and locally. The Raleigh/Cary/Durham MSA did not have a work force increase comparing 8/08 with 8/07 for the first time since the 8/01 versus 8/00 period.
5).The mortgage metrics survey reveals some additional information regarding the national mortgage market. They surveyed over 30 million outstanding loans in the Fannie Mae and Freddie Mac system and found that 98.6% of these loans were rated as current. They also state that foreclosure proceedings were initiated on 432 homeowners per day during the second quarter, a big difference from the 2,700 per day figure stated in the lead paragraph.
There are currently +/‐14,000 listings within the four county area in TMLS. Roughly 3% of these listings are classified as foreclosure, bank or corporate owned. I have been tracking the residential market within the Triangle for over 20 years. The foreclosure market has always accounted for a very small percentage of activity.
Our current market can be summed up with my version of the good, the bad and the ugly;
The Good
• 3rd quarter closings were the 6th highest in history
• Current supply of 8 months is lower than national current supply of 11 months
• Average house price appreciation is superior to state and national rates
• Average re‐sale sales price +6%, average overall sales price +8%,average list price +2%
• Houses priced correctly have sold in an average of 55 days
The Bad
• Overall inventory grew 7%, making 2 consecutive months of <10% growth
• Withdrawn listings increased 2% compared to 9/07
The Ugly
• 29 consecutive months of inventory growth, 20 consecutive months of lower pending sales
• 63% of all price points have an oversupply of housing product
• 9/08 expired listings were 227% higher than 9/07 expired listings
A survey of Wake County house purchases where the house was purchased and then re‐sold within
the past 12 months reveals a median percent per gain of 0%. I think that is pretty impressive
compared to what is happening in the national market.
As we have seen during 2008, our local market is not immune from happenings in the national market. Our biggest challenges during the fourth quarter of this year and into next year are to grow the workforce and cut down on the number of price points with an oversupply of housing.
Thank you for stopping by today. Remember - go buy some real estate. It's a great investment IF you know where to buy a home (we can help!) Also remember, real estate is Raleigh and Cary are on sale. Call or e-mail soon. God Bless.
Friday, October 31, 2008
Friday, October 24, 2008
If I Sell my Home will I Pay Capitol Gains?
Hello Bloggers - thanks for stopping by today. I've had many questions about capitol gains taxes in the past weeks. With the elections coming and many changes in our local Raleigh real estate market, nothing is guaranteed to stay the same forever - but here are the current tax laws for real estate:
The IRS permits a maximum exclusion on capital gain of $250,000 for individuals and $500,000 for married couples filing a joint return who sell their home, but of course some conditions apply.
For the five-year time frame prior to the date of the sale of your primary residence, you must meet the Ownership and Use Tests the IRS provides in Publication 523, Selling Your Home. These rules ensure you have owned the home for at least two years, and lived in the home for at least 24 months out of the last five years. Additionally, you may not have excluded a gain on your taxes from the sale of a different home within the last two years. Note that if you sell your property for less than your original purchase price, you cannot claim a capital loss.
A 'reduced maximum exclusion' can apply to those who must sell their home due to a change in their place of employment, health issues, or unforeseen circumstances that affect qualified individuals. In all cases, it is best to consult your tax professional or IRS guidelines if you have any questions about the taxes you may be responsible for if you sell your home.
If I can help you - call me or e-mail @ marti@martihampton.com . God Bless - Don't forget to VOTE.
The IRS permits a maximum exclusion on capital gain of $250,000 for individuals and $500,000 for married couples filing a joint return who sell their home, but of course some conditions apply.
For the five-year time frame prior to the date of the sale of your primary residence, you must meet the Ownership and Use Tests the IRS provides in Publication 523, Selling Your Home. These rules ensure you have owned the home for at least two years, and lived in the home for at least 24 months out of the last five years. Additionally, you may not have excluded a gain on your taxes from the sale of a different home within the last two years. Note that if you sell your property for less than your original purchase price, you cannot claim a capital loss.
A 'reduced maximum exclusion' can apply to those who must sell their home due to a change in their place of employment, health issues, or unforeseen circumstances that affect qualified individuals. In all cases, it is best to consult your tax professional or IRS guidelines if you have any questions about the taxes you may be responsible for if you sell your home.
If I can help you - call me or e-mail @ marti@martihampton.com . God Bless - Don't forget to VOTE.
Wednesday, October 22, 2008
Save Money Buying a Home BEFORE January 2009!
Hello Bloggers, thanks for stopping by today. Just a quick reminder that beginning Jan 1, 2009 – many things will change. Here is a change that will affect your pocketbook if you are considering buying a home and financing through FHA in the next few months. This is timely information straight from our favorite lender, Tom Deadmore of WR Starkey Mortgage. Call Tom directly with any questions at – 919 625-1935 or e-mail tdeadmore@wrstarkey.com . Tom says:
"Currently FHA mortgages require a 3% statutory investment from the borrower. That 3% can have a portion go towards the down payment (2.125% ) and the remaining funds can go towards closing cost. As of January 1st, 2009 the minimum investment required by home buyers will increase to 3.5% for the borrower. In addition to the increased investment required, the whole 3.5% will be required to apply to the down payment. This means that if the seller is unable to pay all of your closing costs, then you will have to bring additional funds, over and above the 3.5% required, in order to finalize yr home purchase."
This is important information that will help save you money. If you would like to know how to find the very best home investment for your first home or your 10th home –call us today. In our current market, every home looks like a “deal” but few homes really are a smart buy. Please call us or e-mail to schedule a smart home buyer consultation. We’ve got all the details to help you find a really great home that is also an excellent real estate investment. If you are buying a home in the area of Raleigh, North Carolina and/or Cary, North Carolina. Call or e-mail us today for this valuable resource. Call Marti @ 919 601-7710 or Marti@MartiHampton.com
Remember, go buy some real estate – it’s “on sale” today. God Bless and stop by again soon! Mh.
"Currently FHA mortgages require a 3% statutory investment from the borrower. That 3% can have a portion go towards the down payment (2.125% ) and the remaining funds can go towards closing cost. As of January 1st, 2009 the minimum investment required by home buyers will increase to 3.5% for the borrower. In addition to the increased investment required, the whole 3.5% will be required to apply to the down payment. This means that if the seller is unable to pay all of your closing costs, then you will have to bring additional funds, over and above the 3.5% required, in order to finalize yr home purchase."
This is important information that will help save you money. If you would like to know how to find the very best home investment for your first home or your 10th home –call us today. In our current market, every home looks like a “deal” but few homes really are a smart buy. Please call us or e-mail to schedule a smart home buyer consultation. We’ve got all the details to help you find a really great home that is also an excellent real estate investment. If you are buying a home in the area of Raleigh, North Carolina and/or Cary, North Carolina. Call or e-mail us today for this valuable resource. Call Marti @ 919 601-7710 or Marti@MartiHampton.com
Remember, go buy some real estate – it’s “on sale” today. God Bless and stop by again soon! Mh.
Monday, October 20, 2008
Will the Election Affect the Value of Your Home? You Bet it Will!
Hello Bloggers – Thanks for stopping by today. I hope you are doing great. Are you getting excited about the election? Many are, because they feel "change is in the air". Whatever candidate wins your vote on or before November 2, it is important to vote and enjoy the rights and freedoms we have as Americans.
What I'd like to write about briefly is your home's value and how what your home could be affected by the coming election. One of the strongest forces in the real estate market place that has caused your home to gain in value in the past 8 years has been current tax laws and exemptions. The current Capital Gains Tax law states that any homeowner that has owned and lived in their primary residence for 2 out of the past 5 years can sell that home and will NOT be taxed on the capitol gain. Another words, a single person that has gained home value up to $250 above what they paid for their home can sell that home with "0" tax due to the US government. A married couple can do the same thing – up to $500,000.
I believe this has been an incredible strength and stabilizer to the real estate market as a whole. There is no doubt that this has helped the upper end markets thrive. Why would I think this? Because many home buyers that I've worked with have decided to purchase a larger home and/or a more expensive home based on our current capitol gains tax laws. When upper end homes are built, carpenters work, appliances are bought, plumbers work, sales people work and a large portion of the economy "moves" forward. Statistics prove that when a home is built – 1000 people directly benefit. It's a "good thing". Real Estate is such a large portion of the economy and this tax incentive was a huge boost for the real estate industry and for your homes value.
Will people still buy bigger home? Yes, likely so, but there is no doubt in my mind that the reinstatement of capitol gains on real estate sales will dampen an already slowing market. So why will the election matter? Senator McCain's plan does not propose any change in existing home sales income tax. This stance, in my opinion, will help our market’s bounce and stabilize sooner. Senator Obama's plan calls for 28% tax on all profit from ALL home sales. If you sell your home and make a profit, you will pay 28% of your gain on taxes. If you are heading toward retirement and would like to down-size your home or move into a retirement community – 28% of the money you make from your home will go to taxes. This proposal will adversely affect the elderly who are counting on the income from their home as part of their retirement.
Less you think I am another greedy capitalist, at least hear my own families experience. My Mom and Step Dad retired years ago and lived in the mountains of North Carolina. When their health failed they were forced to sell their home and come to Raleigh, North Carolina to be close to family (me!). My Mom’s house was worth approximately $138k. They had purchased the home 15 years ago for around 40k. Being very frugal "Depression Babies" they had paid off their home. Both worked in a factory and never earned over 26K in one year’s time in their whole life. Because they sold that home over a year ago, they did not have to pay capitol gains on their primary residence and were able to use that money for housing and other pressing retirement needs. If Senator Obama wins the election, they would have paid over $30,000 to the government. That would have decreased their retirement next egg by nearly 30%. My parents worked all their lives and they worked hard. They deserve the full equity they had gained in their home.
This is only a small aspect of a whole list to consider when you vote this year. But it is an important one for the American home owner to understand.
Thank you for stopping by and God Bless! Go buy some real estate – it's "on sale".
Click to view Marti's comparison of the two candidates (PDF)
What I'd like to write about briefly is your home's value and how what your home could be affected by the coming election. One of the strongest forces in the real estate market place that has caused your home to gain in value in the past 8 years has been current tax laws and exemptions. The current Capital Gains Tax law states that any homeowner that has owned and lived in their primary residence for 2 out of the past 5 years can sell that home and will NOT be taxed on the capitol gain. Another words, a single person that has gained home value up to $250 above what they paid for their home can sell that home with "0" tax due to the US government. A married couple can do the same thing – up to $500,000.
I believe this has been an incredible strength and stabilizer to the real estate market as a whole. There is no doubt that this has helped the upper end markets thrive. Why would I think this? Because many home buyers that I've worked with have decided to purchase a larger home and/or a more expensive home based on our current capitol gains tax laws. When upper end homes are built, carpenters work, appliances are bought, plumbers work, sales people work and a large portion of the economy "moves" forward. Statistics prove that when a home is built – 1000 people directly benefit. It's a "good thing". Real Estate is such a large portion of the economy and this tax incentive was a huge boost for the real estate industry and for your homes value.
Will people still buy bigger home? Yes, likely so, but there is no doubt in my mind that the reinstatement of capitol gains on real estate sales will dampen an already slowing market. So why will the election matter? Senator McCain's plan does not propose any change in existing home sales income tax. This stance, in my opinion, will help our market’s bounce and stabilize sooner. Senator Obama's plan calls for 28% tax on all profit from ALL home sales. If you sell your home and make a profit, you will pay 28% of your gain on taxes. If you are heading toward retirement and would like to down-size your home or move into a retirement community – 28% of the money you make from your home will go to taxes. This proposal will adversely affect the elderly who are counting on the income from their home as part of their retirement.
Less you think I am another greedy capitalist, at least hear my own families experience. My Mom and Step Dad retired years ago and lived in the mountains of North Carolina. When their health failed they were forced to sell their home and come to Raleigh, North Carolina to be close to family (me!). My Mom’s house was worth approximately $138k. They had purchased the home 15 years ago for around 40k. Being very frugal "Depression Babies" they had paid off their home. Both worked in a factory and never earned over 26K in one year’s time in their whole life. Because they sold that home over a year ago, they did not have to pay capitol gains on their primary residence and were able to use that money for housing and other pressing retirement needs. If Senator Obama wins the election, they would have paid over $30,000 to the government. That would have decreased their retirement next egg by nearly 30%. My parents worked all their lives and they worked hard. They deserve the full equity they had gained in their home.
This is only a small aspect of a whole list to consider when you vote this year. But it is an important one for the American home owner to understand.
Thank you for stopping by and God Bless! Go buy some real estate – it's "on sale".
Click to view Marti's comparison of the two candidates (PDF)
Friday, October 3, 2008
Radio round table
Hi all,
If you're like many people, you have questions about the "rescue plan" being worked on by the Senate and House, the condition of the housing market, and how mortgages are being affected by all the financial turmoil. Be sure to tune it to WPTF, AM 680 this Monday, October 6th from 9:00 until noon when I'll be part of a round table of experts discussing the current economic situation. If you can't tune in on the radio, listen live by clicking here!
On the round table with me will be mortgage expert Skip Dyer, president of Proactive Mortgage, and financial advisor and author Peter "Coach Pete" D'Arruda. This will be an interesting and informative discussion with a local perspective!
If you have questions in advance, please e-mail me and I will try to address them on the air if the time and format allow!
God bless. Marti
If you're like many people, you have questions about the "rescue plan" being worked on by the Senate and House, the condition of the housing market, and how mortgages are being affected by all the financial turmoil. Be sure to tune it to WPTF, AM 680 this Monday, October 6th from 9:00 until noon when I'll be part of a round table of experts discussing the current economic situation. If you can't tune in on the radio, listen live by clicking here!
On the round table with me will be mortgage expert Skip Dyer, president of Proactive Mortgage, and financial advisor and author Peter "Coach Pete" D'Arruda. This will be an interesting and informative discussion with a local perspective!
If you have questions in advance, please e-mail me and I will try to address them on the air if the time and format allow!
God bless. Marti
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