31 States Represented In June’s Improving Market Index

June 14, 2012 by

Improving Markets Index June 2012The number of U.S. housing markets showing “measurable and sustained growth” slipped by 20 in June, according to the National Association of Homebuilders.

The Improving Market Index is meant to identify housing markets in which economic growth is occurring as a whole — not just in the real estate space.

By using three separate, independently-collected data series, each tied to local economic conditions, the Improving Market Index takes a broader view of the housing market than other housing market indicators — the Case-Shiller Index, for example — which are often singularly tied to housing contracts.

The Improving Market Index tracks three distinct data series :

  1. From the Bureau of Labor Statistics : Employment statistics
  2. From Freddie Mac : Home price growth
  3. From the Census Bureau : Single-family housing growth

A given metropolitan area is categorized as “improving” by the National Association of Homebuilders if all three data series indicate growth at least six months after that area’s most recent economic trough.

In other words, the Improving Market Index looks past head-fakes of recovery, instead in search of long-term, sustainable growth.

This is one reason why its list of included cities is so fluid. It’s difficult for a metropolitan area to meet the Improving Market Index’s inclusion requirements month-after-month in a post-recession economy.

The Improving Market Index dropped to 80 in June, says the home builder trade group.

The list includes 28 new entrants, with forty-eight markets removed as compared to May. 31 states are represented nationwide.

For home buyers , the Improving Markets Index is a non-actionable report but it does do a good job of highlighting the local nature of real estate. For example, Columbus, Indiana was added as an Improving Market in June. Yet, Indianapolis, Indiana — located just 46 miles away — was downgraded from the same list. 

Economies vary by locale.

The complete Improving Markets Index is available for download at the NAHB website. For a better gauge of what’s happening on the local level , though, talk to a local real estate agent.

Filed Under: Housing Analysis Tagged With: , ,

Before Moving, Check Your New Cost Of Living Estimates

June 13, 2012 by

Cost of Living adjustments in a new townWith home values slow to rise and mortgage rates at all-time lows, there’s never been a more affordable time to own a home.

However, there is more to the cost of living than just a mortgage payment. There’s the cost of groceries, gasoline and routine medical care, too.

Not surprisingly, where we live affects our costs.

Big cities are often more expensive in which to live, for example, and local tax laws influence daily costs, too. 

For home buyers moving across state borders, therefore — or even for those moving long distances intra-state — it’s important to know the relative costs in your new hometown as compared to your current one. Your household cash flow depends on it. You can’t know your budget for a home if you don’t know what life in a new town will cost you.

Enter Bankrate.com’s Cost of Living Comparison Calculator.

In comparing the costs of 60 mundane, everyday items, the Cost of Living Comparison calculator can show you how common costs in your current home town compare to costs in your soon-to-be new home town.

The calculator asks for just three inputs — (1) In what city do you live now, (2) To what city are you moving, and (3) What is your current salary — then uses that information to produce a detailed cost comparison.

Some of the Cost of Living items compared include :

  • Ground beef costs
  • Veterinary services costs
  • Dozen egg costs
  • Doctor visit costs
  • Hair care costs

The calculator also includes local mortgage rate differences to help plan for housing, and accounts for median home prices, too.

The online Cost of Living calculator is based on data from the ACCRA. On the ACCRA website, a similar cost comparison report sells for $5. At Bankrate.com, you can get the data for free.

Filed Under: Personal Finance Tagged With: , ,

Mortgage Payments Fall To All-Time Lows

June 12, 2012 by

Mortgage payments

It’s a money-saving time to be a home buyer. Historically, mortgage rates of all types — conventional, FHA, VA and USDA — have never been lower and low mortgage rates make for low monthly payments. 

According to Freddie Mac’s weekly mortgage rate survey, the average 30-year fixed rate mortgage fell to 3.67% nationwide last week for borrowers willing to pay 0.7 discount points at closing, plus a full set of closing costs. 0.7 discount points is a one-time closing cost equal to 0.7 percent of your loan size, or $700 per $100,000 borrowed.

Today’s mortgage rates are a bargain as compared to just 1 year ago.

In early-June 2011, the average 30-year fixed rate mortgage nationwide was higher by 88 basis points, or 0.88%. If you are among the many U.S. homeowners who bought or refinanced a home around that time, refinancing to today’s mortgage rates could save you 10% or more on your payment.  

Home buyers have measurably more buying power, too.

Here is how mortgage payments on a typical 30-year fixed rate mortgage have changed in 12 months :

  • June 2011 : $509.66 principal + interest per $100,000 borrowed
  • June 2012 : $458.59 principal + interest per $100,000 borrowed

Setting the math to a real-life example, a homeowner whose $350,000, 30-year fixed rate mortgage dates to last June would recognize monthly savings of at least $179 per month just by refinancing into a new 30-year fixed rate mortgage at today’s current levels. That’s more than $2,145 in payment savings per year.

Even after accounting for the required loan discount points and closing costs, the “break-even point” on a refinance like that can come quickly.

Mortgage rates have been dropping but there’s no promise they’ll fall forever. Once rates reverse higher, they’re expected to rise sharply. Therefore, if you’re planning to buy a home or refinance one , consider locking in a mortgage rate while mortgage rates are low.

The market looks good for that today.

Filed Under: Mortgage Rates Tagged With: , ,

How To Keep A Clean Refrigerator

June 11, 2012 by

Clean refrigeratorDo you clean your refrigerator regularly, or only after you’ve run out of space? If your answer is the latter, your refrigerator may be harboring dangerous bacteria that can make you, your family, and your house guests ill.

Refrigerators should be cleaned monthly, inside and out, ideally. The process involves removing all foods, cleaning all shelves, and wiping down drawers. Spoiled food is removed and old containers reclaimed.

The process takes 20 minutes. Here’s how to do it.

First, prepare your cleaning stations, including filling a sink with soapy water, and having drying towels handy. Complete this step before you start to remove food from the refrigerator. This limits the amount of time that food has available to reach room temperature.

Next, remove all food from the appliance. Throw out old food past its expiration, and leftovers which have been in containers for more than a few days. Check dairy products for expiration dates — especially cheeses and creams. Toss fruits and vegetables that have spoiled. Wipe down condiment jars and bottles with a damp towel.

Next, with the refrigerator empty, remove all shelves and drawers and wash them in the water-filled sink. Scrub to remove any caked-on foods and spills. Rinse off the soapy water and dry the part on your drying towels.

Then, while the shelves and drawers are drying, using a mixture of baking soda and water, wipe down the interior surfaces of your appliance. The mixture should be roughly 2 tablespoons of baking soda for every 1 gallon of water. Wipe the mixture off with a clean towel.

Lastly, move the shelves and drawers back into the refrigerator and replace all of the food that’s “good”.

Refrigerators can be a dirty place. We rarely wash our hands before handling food in a refrigerator and that can contribute to a bacteria-heavy environment. A good cleaning, though, can keep our foods — and our home — healthy.

Clean your refrigerator regularly.

Filed Under: Around The Home Tagged With: , ,

Phoenix Leads Annual Home Price Gains, According To Case-Shiller Index

June 8, 2012 by

Case-Shiller Index

Standard & Poors released its March 2012 Case-Shiller Index last week. The index is meant to measure changes in home prices from month-to-month, and from year-to-year, in select U.S. cities.

According to the report, home values rose in 12 of the Case-Shiller Index’s 20 tracked markets, and one market remained unchanged.

Of the Case-Shiller markets, Phoenix, Arizona posted the largest one-year gain, climbing 6.1 percent. Atlanta, Georgia posted the largest one-year loss. Values falling more than seventeen percent there year-over-year.

Overall, the Case-Shiller Index was relatively unchanged in March as compared to the month prior, but down nearly 3 percent on an annual basis. Nationwide, says Standard & Poor’s, home values are back to the levels of late-2002.

Don’t be overly concerned, however. Though widely-cited, the Case-Shiller Index is a flawed and misleading metric. It’s methodology almost guarantees it.

The first flaw in the Case-Shiller Index is its limited geography. Despite there being more than 3,100 municipalities nationwide, the Case-Shiller Index tracks just 20 of them. They’re not the 20 largest ones, either. Houston, Philadelphia, San Antonio, San Jose are specifically excluded from the Case-Shiller Index and each is among the Top 10 Most Populous Cities in the United States.

Minneapolis (#48) and Tampa (#55), by contrast, are included.

The Case-Shiller Index’s second flaw is that only tracks the sales of single-family, detached homes. Sales of condominiums and multi-unit homes carry no weight in the index whatsoever — even in cities such as Chicago and New York in which condos can account for a large percentage of the overall real estate market.

And, lastly, when the Case-Shiller Index is published, it’s published on a two-month delay. Buyers and sellers don’t need housing data from two months ago — they need data from today. The Case-Shiller Index tells us what housing was, in other words. It doesn’t tell us how housing is. 

Buyers and sellers need real-time, actionable information. You can’t get that from the flawed Case-Shiller Index. For more accurate, relevant real estate data, talk to your real estate professional instead. 

Filed Under: Housing Analysis Tagged With: , ,

FHA To Change Its Mortgage Insurance Premium Schedule Monday, June 11, 2012

June 7, 2012 by

New FHA MIPBeginning Monday, June 11, the FHA is changing its mortgage insurance premium schedule for the second time this year.

Some FHA mortgage applicants will pay lower mortgage insurance premiums going forward. Others will pay more. The new premiums apply to all FHA mortgages, both purchase and refinance.

The MIP update will be the 5th time in four years that the FHA has changed its mortgage insurance premium schedule.

FHA-backed homeowners who have not refinanced within the last 3 years will benefit from the new MIP. This is because, beginning with all FHA Case Numbers assigned on, or after, June 11, 2012, homeowners whose current FHA mortgage pre-dates June 1, 2009 will be entitled to dramatically reduced annual mortgage insurance premiums and almost zero upfront MIP via the FHA Streamline Refinance program.

Whereas new FHA applicants may pay up to 1.25% per year for annual mortgage insurance plus 175 basis points at closing for upfront MIP, the “grandfathered” FHA applicants will pay just 0.55% per year for mortgage insurance and 1 basis point at closing.

Assuming an FHA loan size of $200,000, the savings are large :

  • New FHA applicant : $208 per month for annual MIP; $3,500 due at closing for upfront MIP.
  • Pre-June 2009 FHA applicant : $92 per month for annual MIP; $20 due at closing for upfront MIP.

The premiums apply to all FHA mortgage applicants, regardless of loan product or term. For example, 15-year FHA mortgage will follow the same mortgage insurance premium schedule as a 30-year FHA mortgages.

Another class of FHA-backed homeowners won’t get so lucky. For homeowners in high-cost areas whose mortgages are between $625,500 and the local FHA loan limit, annual mortgage insurance premiums will be raised by 0.25% for all 15-year and 30-year loan terms.

For loan sizes above $625,500, the new annual FHA mortgage insurance premiums are as follows :

  • Loan term of 15 years or fewer, loan-to-value of 90% or less : 0.35% per year
  • Loan term of 15 years or fewer, loan-to-value greater than 90% : 0.60% per year
  • Loan term of more than 15 years, loan-to-value of 95% or less : 1.45% per year
  • Loan term of more than 15 years, loan-to-value greater than 95% : 1.50% per year

FHA-backed homeowners with loan terms of 15 years or fewer, and with loan-to-values below 78%, are exempt from annual MIP. Upfront MIP payments, however, remain mandatory.

The FHA continues to tinker with its mortgage insurance premiums, attempting to strike a balance between affordability for its homeowners and solvency for its program. Experts expect the FHA to change its premiums again. And, when it does, it’s likely that premiums will rise.

If your FHA mortgage will be for more than $625,000, and you plan to make a purchase or refinance application soon, it’s best to get your FHA Case Number prior to Monday, June 11. Otherwise, you’ll pay higher annual MIP.

Against a $700,000 mortgage, the extra 0.25% in MIP per year will add $1,750 to your annual housing payment.

Filed Under: Mortgage Guidelines Tagged With: , ,

Simple Real Estate Definitions : Home Inspection

June 6, 2012 by

Get a home inspectionWhen you preview homes as a home buyer, you can get a good feel for the home’s visible traits — its finishes, its room counts, and its landscaping, for example. What you can’t get a feel for, though, is the home’s “bones”.

It’s for this reason that real estate professionals recommend that you have a property formally inspected immediately after going into contract for it.

A home inspection is a thorough, top-to-bottom check-up of a property’s structure and systems. It is not the same as a home appraisal, which is a valuation of the property. By contrast, home inspections are an objective report on a home’s physical condition.

Home inspections are performed by home inspectors who will typically do the following :

  • Check heating and cooling systems for leaks and efficiency
  • Check electrical systems for safety and soundness of design
  • Check plumbing systems for venting, distribution, and drainage

In addition, a home inspector will review a home’s roofing system; its doors, windows and garages; plus, any attic spaces and basements, where appropriate.

A home inspection may also uncover out-of-code electrical work that municipalities required to be fixed by law.

Meanwhile, it’s not just home buyers who can order inspections. Sellers can order them, too.

One recommended tactic is for a home seller to have the home inspected prior to listing for sale so that all required repairs can be made in advance of showing the home. This can speed up and simplify the sales process, and may help your home sell at a higher price. Buyers often prefer homes in “move-in” ready condition.

A thorough home inspection can take up to 6 hours to complete, depending on the size of the home.

Filed Under: Real Estate Definitions Tagged With: , ,

Celebrating National Volunteer Month

April 18, 2012 by

VolunteerDid you know that April is National Volunteer Month?

Volunteering is the art of giving your labor or expertise for free and many charities and local programs could not exist without the help of volunteers.

This month is the time to think about how you can give some of your time and efforts away to help your community.

Reasons to Volunteer

Here are a few reasons why volunteering is a great thing to do no matter what month it is:

  • You get a warm feeling inside from giving your time and skills to help people.
  • It’s a great way to meet people and make friends.
  • It is also a great way to feel like you are part of your local community.
  • You can learn something new and gain valuable work experience.
  • You can make someone’s life easier or more enjoyable.
  • Volunteering looks great on university applications or resumes.

How Can I Volunteer?

There are many ways that you can volunteer your time and efforts during National Volunteer Month and throughout the year.

The first step is to think about what you enjoy doing and what you are good at and how those skills can help your community. For example, if you are really good with children you could volunteer to be a mentor with a Big Brothers and Big Sisters organization.

If you are a carpenter you could lend your building skills to construct houses for low income families. Even technological skills such as web design can come in handy, as you might offer to design the website for a local charity organization.

If you do a quick search for volunteering opportunities in your local area you will be sure to find many positions available. You can also look on a website such as http://www.volunteermatch.org which allows you to search for your local area and identify which type of volunteering you would like to do.

Many people think that they don’t have the time to volunteer, but you don’t have to make volunteering your full time job.

Many organizations will be happy to have your help for a few hours per week or even one day a month. It is up to you how much time you are able to commit to helping out.

Have fun volunteering and helping out your local community!

Filed Under: Personal Development Tagged With: , ,

How to Keep Your Car Organized

April 16, 2012 by

Auto InteriorYour car is your important mode of transport between point A and B, but if you are like many people you might also be in the habit of using it as a trash can on wheels.

Are you embarrassed when you offer someone else a ride in your vehicle because of the detritus of empty bottles, pieces of paper and food wrappers that litter the floor?

If you have children, do you have to clear an entire army of toys and stuffed animals from the back seat before anyone can sit down?

If your car is becoming a disaster zone, here are some tips for regaining control of the clutter.

Everything in Its Place

One of the main reasons why your car is such a mess is that nothing has a rightful place to be. You eat a granola bar while you are driving, and then stuff the wrapper in the cup holder thinking that you will dispose of it later and then usually forget.

The trick is to create a system where all of the garbage and junk in your car has a place. Keep a small trash bag in your car at all times, so that you can discard things in it rather than letting them get lost on the floor. Every few days you can throw the bag away and replace it with a new one.

Do Quick and Frequent Cleans

If you are waiting outside for five minutes to pick up a friend, use that time to do a quick tidy of your car. Gather all of the garbage and throw it away in a nearby garbage can, as most public places will have one.

If you can get in the habit of clearing out the junk in your car every few days, the problem will never build up to a point where it becomes overwhelming.

Organize the Back Seat

When you are driving around with your little ones, it’s great to have toys and books in the back seat to keep them occupied. To keep the mess under control, there are clever little organizers that you can buy which hang over the back of the front seat and include pockets for books, magazines, and small toys.

When you are a couple of minutes from arriving at your destination, give your kids the heads up to start putting their toys away so that they get in the habit of tidying up after themselves in the back seat.

These are just a few things that you can do to keep your car organized and tidy! 

Filed Under: Organization Tips Tagged With: , ,

Exploring the Historical Sites of Puerto Rico

April 14, 2012 by

Puerto RicoThe Caribbean island of Puerto Rico has a long and fascinating history. Because it is located right in the middle of the “New World” it has been a target of conquest for many centuries.

Christopher Columbus landed on the island in 1493, on his second voyage of discovery. It was later settled by the Spanish explorer known as Ponce de Leon and was under possession by the Spanish for over 400 years.

At the end of the Spanish American war, the island of Puerto Rico became United States territory due to the Treaty of Paris.

There are many battlements and fortifications throughout Puerto Rico, built to protect the island from its many invaders.

These are very interesting places on the island that reveal fascinating stories about the past. Here are some of the best historical sites:

 Castillo de San Cristobal

This Spanish fort is the largest ever fortification built by the Spanish in the New World. It was constructed in 1783 to protect the city of San Juan from attacks, and it covers approximately 27 acres of land wrapping all around the city of San Juan.

The fortress is perched upon a hill called the Cerro de San Cristobal, named after the Spanish victory ejecting the English and the Dutch interlopers from the island of the same name in the Lesser Antilles.

This fort is truly an amazing historical building to explore, and includes an extensive underground tunnel system, an artillery observation post, and real 200 pound mortar shells.

Fort San Felipe del Morro

Also known as Morro Castle, this is a 16th century citadel that makes a great day trip from any Puerto Rico resort as it is located just within the city of San Juan. 

The fortification, named after King Phillip of Spain, was designed to guard the city of San Juan from enemy attacks from the sea. Over two million people per year visit this historical site, making it one of the major attractions in Puerto Rico.

The castle is considered an official UNESCO World Heritage Site and as a “must-see” while you are in Puerto Rico.

Fortin San Juan de la Cruz

Fortin San Juan de la CruzThis tiny fort is not as large as the other historical sites, but it is just as interesting. It is located on Isla de Cabras, right at the entrance to the San Juan bay.

It was placed here to create a strategic location for crossfire at any invading ships, and its location ensured complete artillery coverage of the area.

Apparently, there used to be a long chain which was stretched from Fortin San Juan de la Cruz to the Fort San Felipe del Morro, which would create a physical barrier and stop ships from coming into the harbor.

The fort was also in an important location for guarding the Bayamon River. The square building was built in the 1600s and although the interior is closed to the public you can walk around the walls.

These are just a few of the fascinating historical sites that you can visit while exploring the beautiful island of Puerto Rico.  

Filed Under: Travel Tagged With: , , ,