Home Loans Refinance

Admin Note:  I found a solid article on mortgage loan refinancing specifically with a loan modification program.  As mortgage rates decline, but home values decrease, loan modifications with a home loan refinance will become more popular.  Here’s the link:

http://mortgagemade.com/making-home-affordable-loan-modification-program-examples.php


California Tops List for 8 of 10 Worst Housing Markets

In a recent AP story, it appears California is taking the brunt of the housing downturn.  This is not unusual.  Remember that the California housing market has been volatile for 30 years. 

It appears the housing market has not bottomed out yet. For the third quarter, 2008, the S&P Case-Shiller national home-price index fell 16.6%.  While it would appear the market has further to fall, hopefully the rate of decline for the housing market slows down. 

Of the top 100 markets, here are 10 with the worst forecasts.

1.  Los Angeles 

2008 median house price:  $375,340

2009 projected change:       -24.9%

2010 projected change:       -5.1%

The median home price in the L.A.- Long Beach-Glendale metro area is projected to fall nearly 25% in 2009 – the biggest drop in the country.

 2.  Stockton, CA 

2008 median house price: $248,050

2009 projected change:       -24.7%

2010 projected change:        -4.0%

3.  Riverside, CA 

2008 median house price:  $256,540

2009 projected change:         -23.3%

2010 projected change:           -4.8%

4. Miami-Miami Beach

 2008 median house price:   $293,590

2009 projected change:          -22.8%

2010 projected change:             -6.4%

After falling 22% in 2008, home prices in Miami are predicted to plunge another 23% next year.

5. Sacramento

 2008 median house price:  $225,140

2009 projected change:          -22.2%

2010 projected change:             -2.3%

6. Santa Ana-Anaheim

 2008 median house price:   $532,810

2009 projected change:          -22.0%

2010 projected change:           -3.5%

7. Fresno

 2008 median house price:    $257,170

2009 projected change:          -21.6%

2010 projected change:             -3.3%

 8. San Diego 

2008 median house price:  $412,490

2009 projected change:           -21.1%

2010 projected change:             -2.9%

9. Bakersfield, CA.

 2008 median house price:     $227,270

2009 projected change:            -20.9%

2010 projected change:               -2.5%

10. Washington, D.C. 

2008 median house price:   $343,160

2009 projected change:           -19.9%

2010 projected change:             -5.7%

Source: Associated Press

 Thus, it would appear median home prices in California will remain soft at least another year. 


Home Market Values? 5 Steps to Find and Track Them

 A few days ago I called home values pendulums on steroids.  They are swinging wildly.  Others might suggest that the value of homes were like skydiving with a questionable parachute – you’re falling way too fast and you hope the ‘chute opens before you hit bottom. 

 

 

Whatever you call this current real estate home market, most can agree it is difficult right now to find true home market value.

 

Before we jump in and look at the 5 step process to assist you in finding home values, let me present a definition of market value.  The simple answer to the market value definition is:  the price a willing buyer will pay a willing seller. 

 

However, I think taking a closer look at the definition of home market value, or simply market value, is worth noting. 

 

The Federal Office of the Comptroller of the Currency states market value is:  The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus 

 

The definition goes on and gets more detailed, but, in layman’s terms what this says is that market value is the price a buyer pays to a seller when they both know what they’re doing and the property has been exposed and available for sale.  In ever simpler terms – what would someone pay for a home with a “for sale” sign in the yard? 

 

 

That is the essence of home market value.

 

Ok, now let’s look at the five steps to determine what a home is worth, or the value of the home.

 

1)     Start by looking at national, regional and local housing trends.  National trends are everywhere – just make sure you’re looking at facts and not opinion on home values.  Statewide or regional area trends are typically available somewhere on line for free if you can locate them.  Here in Texas, the Texas A&M Real Estate Research Center puts out an excellent home value trends report.  Contact your local appraiser, realtor or lender for a source in your area.  You’ll notice your region could be substantially different from national trends –either for the better or worse.  Home values continue to plummet in the Phoenix area, while some markets in Texas have had flat to slightly increasing values. Your local market probably has a Multiple Listing Service, or MLS, and most usually compile quarterly or regional data. 

 

2)     Pull up the current assessed value of a home and others in its market area.  Look at the assessment history.  Is the value trending up, down, or is it stagnant?  This is a good initial research step that will just take a few minutes, assuming your assessor’s office has on-line data. Here’s a key – divide the total assessment by the home’s square footage and look for trends and consistency.

 

3)     Talk to realtors.  Notice I realtors, not realtor.  Talk to several about home values in their market area.  I find most realtors are pleasant and pretty chatty.  Good places to talk to realtors (and appraisers for that matter) are at local Chamber or community events.  Bad places to talk to realtors are church, the grocery store, or any other place where you may be intruding. 

 

4)     Talk to appraisers.  Anyone truly seeking to know home values for their area needs a working, or at least talking relationship with a good appraiser.  Realtors can be a source for quality appraisers, but do some research on your own.

 

5)     Monitor listing prices in your area. Check your Sunday paper and other classified sources.  Do you see a large number of “reduced” prices listed?  Make a simple chart of homes/areas you’re familiar with.  Are these home prices lower than you recall 6 months prior?  Remember when it comes to determining the value of homes – data is king.

 

Ok, these five steps are not only the beginning, but also the cornerstones for determining values and home value trends in your area.  Make a habit of tracking where home values are heading.  Once you start you’ll develop a better eye for value and home pricing in general. 


What’s My Home Worth?

With real estate prices swinging wilder than a pendulum on steroids over the past few years, the question on every homeowner’s mind today is – What’s my home worth? 

Maybe you’re not an owner, but a buyer – you still are obviously asking the home value question.  If you’re looking to refinance your home with current low rates, or, maybe you need to pull some equity out of your home for college tuition – the question will still arise – how much is my home worth?

My first suggestion to you – take a deep breath, step back and realize that regardless of the answer a) There’s not a lot you can do about it today; and, b) Everything will be alright – eventually. 
 
Ok, back to the question of the value of my home. Let me offer four easy and very do-able steps you can begin taking today to find your answer. 
 
Your four fundamental steps to begin answering the question of how much is my house worth? Include:

  1. Start with your home assessment to determine the value of homes in your area. Most assessor’s office or appraisal district data is on line these days, and the search process is pretty simple to follow. If not, call your local office and ask for your current total assessment, or, better, drive there and get a current print out. First – get your home valuation expert hat on and ask yourself – is my home worth this much or more? Remember, everyone has an opinion of value and yours matters too.  Get a few other assessments in your area for comparison purposes.
  2. Compare your assessment with current listings in your neighborhood.  With your assessment in hand, do some investigating of home listings in your area. Most Multiple Listing Services (MLS) can be searched on line, or, you can simply look in your local paper’s classifieds. Does your current home appraisal by the Assessor’s office stack up, or is it wildly different from current listings?  Remember that current listings generally represent the upper limits of value in your area, while your assessment is either at, or potentially below the actual value of your home. You certainly hope your assessment is below real market value, and, if it is not, I would advise protesting your home value in efforts of reducing your property taxes.
  3. Call a realtor who you feel confident knows home market values in your area. Most successful realtors are pretty talkative, but also remember they are very busy. If you have a realtor friend, start with them. Be straight forward – ask them what home values are doing in your neighborhood. Make more than one call as realtors opinions vary as well. Talk to a realtor who you know has sold a home in your neighborhood recently. Be professional and courteous and you will get solid information.
  4. Have a limited appraisal performed on your home.   Even though I appraise homes for a living, I put this last simply because you can do a lot on your own without spending money. However, if you really want to know and you don’t mind spending from $100 to $400 or so dollars, this is your best bet. With the market downturn many appraisers are either slow or downright starving for business now. Call a few and see if you can locate an appraiser that works your area and may be looking for work.   Many appraisers are open to bartering – that is, offer your business service to them in return for a limited appraisal.   If money is tight, ask an appraiser if he/she will “run comps” in your neighborhood. They may be willing to do this for under $100, depending on your area. But, if you’re going to spend money, my advice is to get some type of real appraisal. Also, remember, if you’re in the process of re-financing your lender will require an appraisal anyway. Wait for them to order it so you don’t pay twice, and remember to ask for a copy of the appraisal when it’s complete.

So, tackle these steps and you will be well on your way to answering the question of how much is my home worth? Don’t procrastinate – take action today and you can have solid answers quickly.