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Monika Nosowski Associate Broker E-mail Office: (215) 379-1100 Direct: (215) 379-1131 Cell: (267) 312-5512 Fax: (315) 379-8533

 The Clock is Ticking!
Time is Running Out for Significant Savings! 

 Attention home buyers! Waiting to buy a home could cost you nearly $20,000 or more over a seven-year period if you time your purchase incorrectly. While the actual impact will vary depending on purchase price, the impact will certainly be significant because of stimulus programs scheduled to end in the coming months.

Economic turmoil and the real estate bubble have created significant opportunity for all those seeking to capitalize on the situation at hand. Let's address the real estate purchase market and what people interested in both buying and selling a home need to know this month to take advantage of the current market conditions.

As little as a few years ago, it would have almost been incomprehensible to expect that actions from Washington would impact decisions involving the purchase and financing of real estate. Well, that was then and this is now and the decisions people make or don't make stand to impact wallets across the country.

Before You Buy – Things to Consider
The pressure is on to buy in the first quarter of 2010, so what should buyers focus on before pulling the trigger? Buyers  should focus on three things that are either expensive to fix later or unable to change without buying another home:  "Location, Lot and Layout."

When considering location, use technology like GoogleMaps™ before visiting a home to save both time and gas. Mapping allows you to view the property from different angles, see if the home is on a busy street, or if it offers the other requirements you need. For example, if you need a large yard where the kids or dogs can play, a tool like GoogleMaps™ will help you eliminate some homes immediately.

While it is relatively easy to get caught up in the aesthetics, don't do it. Overlook items you can change later like paint, carpet and other cosmetic details. Narrow your focus down to two or three homes and "all things being equal, focus on location, lot and layout."

Selling a Home?
If you are selling a home and want to make sure you can get it off the market for time crunched buyers, remember that today Sellers need to be focused on having their home priced competitively and making it most appealing upon inspection. Sellers also should consider paying for a home warranty to alleviate any concerns cash-strapped buyers may have about paying for repairs after closing.

More than anything else, both buyers and sellers this year should not let the money savings opportunities pass them by. Anyone that qualifies is in a no-lose situation – they are buying at the bottom of the market, economically, historically, seasonally, market-wise and interest rate-wise. The perfect storm has arrived and the pearls and treasures have floated to the surface.

Gifts from the Federal Reserve Are on the Clock

Mortgage rates have been artificially low the past fourteen months due to assistance from the Federal Reserve and their mortgage backed securities purchase program. Regardless of the expert, when asked what the impact has been to lowering rates, the range is from 0.50-1.00% or potentially more. The Federal Reserve reiterated in its January statement that they will be ending the program on March 31st.

While it is uncertain to what degree interest rates will immediately rise starting April 1st, the overwhelming trend will be higher. Many experts are predicting that rates will start to rise in advance of April 1st.

Tax Credit
Low mortgage rates are not the only stimulus program ending in less than three months. Credited for boosting a major share of home sales at entry level, first time home buyers have been taking advantage of a tax credit of up to $8,000 for over a year.

Repeat purchasers were also given incentive in November with the availability of up to $6,500 in post-closing cash. Tax credit qualifying buyers have until April 30th to get under contract and must close by June 30th. If home buyers miss either date, it will be a costly one.

HUD and the FHA Tighten Up
HUD announced in January that the upfront costs to obtain an FHA mortgage are going up for any applications received April 5th or later. The cost of the up-front mortgage insurance premium (MIP) will increase for all case numbers effective April 5th by 0.50%, from 1.75% to 2.25%.

What Waiting Will Cost You
The costs of missing out on the combined incentives add up quickly for those who fail to act by the deadlines. The first incentive scheduled to end will impact buyers on a monthly basis in the form of higher monthly payments. On a $200,000 mortgage, a 1.00% increase to interest rates could increase a monthly payment by $125 a month or $10,500 over a seven-year period. Obviously, the longer the loan remains in place, the greater the impact of the potential loss.

The second potential loss that will be incurred would be waiting to obtain a mortgage guaranteed by the FHA. In the same example of borrowing $200,000, the upfront cost would be an additional $1,000, or .50% of the amount borrowed. While this cost may be financed, the impact to a monthly payment would also be an increase of approximately $5 a month and have to be accounted for later upon the sale of the property.

Finally, the third potential cost in waiting will be the end of the tax credit for qualified buyers of a primary residence, up to $6,500 for repeat buyers and up to $8,000 for first time home buyers.

Add all this up and the cost of choosing to wait could run up to nearly $20,000 or more depending on the purchase price of a home and the type of mortgage applied for. So, even if someone believes that home prices may fall from where they are today, even with a modest decline in price, the cost of waiting could outstrip any benefit of finding a home for less.

What's Happening in Real Estate for 2010? By Melissa A. Nykorchuk Photo: © Sean Prior - iStockphoto The real estate market in 2010 has more promise than in the past few years. With house prices in some areas beginning to stabilize and historically low interest rates, the real estate market is perfect for buyers with good credit. The Tax Credit is a Positive Incentive With the $8,000 tax-credit incentive extended through April 2010, first time homebuyers are continuing to buy homes that they might not have bought without the incentive. Home purchases for first time homebuyers are expected to continue to rise until the tax-credit incentive ends.

Qualified Buyers Come Out Ahead Although lenders are keeping the debacle of the sub-prime mortgage crisis in consideration as they accept new loan applications, those who have verifiable income as well as a high credit score are prime candidates to secure a great mortgage in today’s market. Unfortunately, some real estate markets across the United States may have to absorb a new wave of foreclosures because there is a backlog of homes already in the foreclosure process; rising unemployment rates are making this problem worse. Though this isn’t good news for sellers, for the savvy investor there is still opportunity for a good deal. Move-in Ready Homes Attract Buyers The trend for prospective homeowners is buying a home that needs little or no fixing up and the smart home seller will make necessary repairs to ensure their home sells for a fair price. Home sellers can consult a home staging professional to ensure that their home is appealing and ready for sale. Home staging might include small repairs, furniture relocation and removing clutter from living areas.

Buy Now and get your Tax Credit $$$

Learn about $8,000 first time home buyer tax credit and $6,500 current homeowner tax credit when buying a new home! read more...

 The Newly Extended Tax Credit
Is Great News for Real Estate
By Deanna Lynn Sletten
Potential homebuyers who were afraid they would miss the deadline for the first-time homebuyer tax credit can now continue the search for their new home without worry. The new extended homebuyer tax credit became effective on November 7th and continues until April 30, 2010. With the new tax credit, not only do first-time buyers enjoy the benefit of a tax credit, but people who are homeowners looking to buy a different home can benefit... Read More

 How to File for the Latest Homebuyer Tax Credit
By Cheri Dohnal
The homebuyer tax credit has undergone so many alterations that many people are no longer sure which homes and taxpayers qualify for it. Since it has been extended and expanded for a limited time, it's important that its newest provisions are understood even before the IRS releases the forms to claim it.

Important Tax Credit Updates
The expanded version of the credit is not limited to first-time buyers, although there is still a credit of up to $8,000 offered to first-time buyers. Now there is also a credit for "long-time residents" who buy a new home, and both credits have been extended into 2010... Read More

If you have been waiting for the interest rates to drop so you can BUY a new home, now is the perfect time! Overall, the rates are lower than they have been throughout the past three years! Don't wait any longer - make your move now before the rates go up again. Call Matthew Nosowski [at (215) 450-6066] for a FREE pre-approval.