Understanding Your FICO Score

realestateinsight — Tue, 09 Mar 2010 20:50:02 +0000

Sale prices in the Providence Metro area increased 6.1 % in the four months ending Feb. 28 compared with the quarter ending Oct. 31, according to the Clear Capital Home Data Index, faster than anywhere else in the nation. Many people are taking advantage of low interest rates home prices, and the homebuyer tax credit. But many people are finding tighter lending standards are leaving them cold. Those with less than perfect credit pay a premium for almost everything.

This week Rich and Steve spoke with Paul Decoste from Advantus Credit Reporting Agency to talk about maintaining a good credit score. Credit scores affect not only what you pay for credit cards, auto loans, mortgages and other credit but insurance companies and potential employers look at credit scores as well . Paul recommended visiting www.myfico.com to see how different scenarios can affect your credit rating. According to the website, a borrower with an established good credit history can expect to see their FICO score fall over 200 points if they declare bankruptcy. That would result in a subprime score requiring a larger down payment and a higher interest rate. While prime borrowers are presently enjoying rates around 5%, a borrower with a FICO score in the 620 to 639 range can expect to pay about 6.3% interest on a conventional loan with 20 percent down. On a $200,000 loan, that would be over $70,000 more in interest over the life of the loan.

This Week’s Real Estate Insight:

Despite the catchy jingles, freecreditreport.com is only free if you remember to cancel the service in a timely manner. The only site from which to get a truly free report is AnnualCreditReport.com . When you first get to the official site, you must read carefully, so you won’t be diverted to other sites. There is bold red lettering that says: “Start here to view and print your credit report now.” Then you select the state you live in to begin the free-credit-report process

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Single Family Home Sales Rise in January

realestateinsight — Tue, 02 Mar 2010 19:22:13 +0000

The Rhode Island Association of Realtors reported 395 sales in January, a 9 % increase from January 2009. The median price rose 14 % to $200,000, and days on the market fell 24% to 83. Condo sales rose 28%, prices remained virtually the same, and days on the market rose 2 percent. Multi-unit sales fell 21 percent, while price increased 21 percent and days on the market fell 36%. While January is typically the slowest month for home sales, weather has been on our side unlike other parts of the country that have been paralyzed by record snow this season.
The expanded homebuyer tax credit was intended to help stabilize prices and promote sales, but there are not a lot of buyers out there, and not many of them are citing the credit as a reason for buying. The housing market remains vulnerable, unemployment is still high, and consumer confidence is falling. Home prices have stabilized in some markets, but there are a lot of people would like to sell but are stuck because their homes aren’t even worth what they paid for it. According to Moody’s Economy.com, nearly one-in-three mortgages are currently in that situation. That’s a major issue for borrowers who owe more than their home is worth.

This Week’s Real Estate Insight:

The true stimulus effect of both the homeowner tax credit and the home sales they could create this year will be on local economies. According to the National Association of Realtors, each home sale contributes $63,000 on average to an area’s economy. That includes real estate agent commissions, attorney and title company fees, insurance, and purchases like furniture and appliances.

To qualify for the $6,500 credit, buyers must have owned and lived in the same home for five consecutive years out of the past eight. They must be in contract by April 30 and close before June 30. The home’s purchase price can’t exceed $800,000, and it must be used as a main residence. The income limit for single taxpayers is $125,000; and $225,000 for a married couple.

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Rhode Island Housing HelpCenter Wins Award

realestateinsight — Tue, 23 Feb 2010 19:28:27 +0000

The Rhode Island Housing HelpCenter is a winner of a 2009 Justice Award in the category of Consumer Protection. The awards are given in recognition of an extraordinary commitment to justice exhibited by members of the community. Richard Godfrey, Executive Director of Rhode Island Housing stated Rhode Island Housing has seen over 5,000 Rhode Islanders in the HelpCenter. Rhode Island Housing works with its partners to bring free workshops to communities throughout the state. Trained counselors provide advice, education, resources and referrals free of charge to assist homeowners in understanding the options now available to those in need of housing help. In addition, in partnership the FDIC, The Housing Network of Rhode Island, and the Attorney General’s Office, the HelpCenter also participated in a free seminar to alert Rhode Islanders of the scams currently plaguing Rhode Island and raise awareness of the available resources and recourse in the public and non-profit sectors.

This Week’s Real Estate Insight:

Rhode Island Housing is a self-sustaining public agency, which generates its own operating income, without state funding. Everything the agency earns is reinvested to meet the needs of the state. Together with its partners, the agency works to ensure that all people who live and work in Rhode Island can afford a safe, healthy home that meets their needs. Rhode Island Housing provides low-interest loans, grants, education, advocacy and consumer counseling to help its customers rent, buy and retain their homes. It also offers special programs to ensure that these homes are safe and healthy

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Foreclosures down in Ocean State

realestateinsight — Thu, 18 Feb 2010 16:30:50 +0000

The number of foreclosure notices filed in Rhode Island in January declined almost 13 percent compared with a year earlier. According to a report released last Thursday by RealtyTrac, one out of every 696 homes in Rhode Island received a foreclosure notice in January filings are also 5% lower than December. Nationally, one in every 409 homes received a foreclosure notice in January, up 15 percent from a year earlier but down 10 percent from December, RealtyTrac said.

According to RealtyTrac Chief Executive James J. Saccacio January’s numbers are very similar to a year ago a double-digit jump in December followed by a 10 percent drop in January. “If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives work,” he said.

This comes on some the heels of some promising end of year statistics, overall foreclosure filings in Rhode Island decreased 23 percent in 2009 compared with the prior year.

This Week’s Real Estate Insight:

While we still have one of the highest unemployment rates in the country, Rhode Island does seem to be bucking the trends for foreclosure filings. Nationally, Rhode Island accounted for less than 1 percent of the foreclosure filings reported nationwide in 2009 and total U.S. activity increased more than 21 percent over the level reported for all of 2008.

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Most Epensive Homes Sold in 2009

realestateinsight — Mon, 08 Feb 2010 21:46:44 +0000

It has been my tradition to recap the most expensive home sales on Super Bowl Sunday’s Show. The most expensive single family home sold in the U.S. in 2009 was in Aspen, Colorado for $43 million. This 25,000-square-foot, on 4.5 acres has 11 bedrooms, including the guest house, 15 bathrooms, gym, four powder rooms, wine cellar and a pool. That is a far cry from the glut of $100 million plus homes of recent memory. In 2006, we thought that the luxury market wouldn’t’ be affected like the broader market. As 2008 went from bad to worse, some blamed the excess inventory of luxe properties. When Lehman Brothers fell in September of 08, reality set in. Now properties in that range are either being drastically reduced or are quietly going off the market. In 2008, the cheapest house on The Forbes Top Ten list was $75 million, now there are 4 priced under that on the list, and they still have houses that came on two and three years ago.

In Rhode Island, as overall sales fell in 2005 thru 2007 the high-end market remained stable with about 190 sales per year. In 2008 there were 138 high end sales, and that dropped to 93 in 2009. In 2006, Rhode Island had a record house sale of $17.15 million. The most expensive home sold last year was Astors’ Beechwood Mansion on Bellevue Avenue for $10.5 million. It came on the market in 2007 for $16 million and appraised at just under $7.14 million. Wrentham House, an 1891 stone mansion on Ocean Avenue in Newport, sold over the summer for $6.51 million. The historic property, designed by Richard Morris Hunt and landscape designer Frederick Law Olmsted, had been on the market for more than four years, and had been earlier priced at $14.4 million. The 14,400-square-foot mansion features 22 rooms,13 bathrooms, and 8 bedrooms. Wrentham House had been abandoned since the mid-1960s, when an abutting property owner, bought the property and left it vacant. The previous owners bought the house in January of 2000 for $1.35 million and put 6 million into the renovation and obtained historic tax credits worth $1.1 million to renovate the mansion.

This Week’s Real Estate Insight

Do you think any of those buyers took advantage of the tax credit? If any of these properties are going to be the new buyer’s primary residence, they would be crazy not to! The credit is set to expire in April, so don’t delay, there are bargains to be had in all price points.

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Splurge and Save with Krista Watterworth

realestateinsight — Tue, 02 Feb 2010 22:18:03 +0000

This week Rich and I spoke with my good friend Krista Watterworth, designer/ host of HGTV’s Splurge and Save. Long time Real Estate Insight listeners will remember Krista’s lending her style and expertise on our show in the past, and from her other HGTV series including Save My Bath, You Should Live Here, and The Big Reveal.
Splurge and Save is a half hour design makeover series that shows homeowners how to get the biggest bang for their buck. Using her design secrets, Krista shows how to pull together any room, how to build the right budget for any room, and, of course, how to stretch every dollar. From furniture to rugs to window shades to accent tables, Krista pulls all the pieces of a room together on budget and in high style. High style doesn’t always have to be high cost; Using one or two really nice pieces as a focal point, and complementing them with more budget friendly options is a great way to stretch a dollar when designing One example from the show is when she put a designer chair next to a knock-off sofa or repainted an old end table and topped it off with a $500 vase.
And while she never did share the passion for cooking her big Italian influenced family had growing up, she did learn from watching them that attention to detail, balance of color and flavors, and careful selection of ingredients were the secret to all great recipes. These are the sensibilities that Krista brings to her website, RoomRecipes.com , a great blogging community about practical home design. Recent posts include Five Cool Room Updates for Under $20.10, and Organize the Kitchen.

This Week’s Real Estate Insight

For sellers, adding a little designer flair to a home could give you the advantage to stand out from your competition and get your house sold. Some studies suggest the ROI on staging can be over 300%, but even if you break even on your investment, if staging can make the difference between selling the house at all or languishing on the market for months, you are still way ahead of the game. Television shows like HGTV’s Splurge and Save can give great tips for the budget minded homeowner.

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Warren Group Reports Signs of Stabilization in Southern New England

realestateinsight — Tue, 26 Jan 2010 19:55:51 +0000

Sales of single-family homes in Rhode Island rose 14.4% in 2009 compared with a year earlier, more than in any other New England state, as well as the biggest rise in multi-family home sales, at 35.6 percent. But the median price of a single-family home in Rhode Island slid 13.3%. Multi-family homes fell by even more, falling 32% to average $94,000, down from $133,000 in 2008.

In Nearby Massachusetts, 2009 saw single-family home sales rise for the first time in four years, but the median sales price remained almost 20% below its 2005 peak. The Warren group reported sales of single-family homes climbed 3% year over year, while the median price fell 6.6%, from $305,000 to $285,000, the group said.

”The latter part of 2009 gave us some clear signs that the housing market is stabilizing and heading for a recovery, and while prices were still falling the percentage drop last year wasn’t as steep as it was in the previous two years,” said Timothy M. Warren Jr., CEO of The Warren Group. “What’s more, December was the first month in more than two years that the monthly median home price climbed year-over-year. The improving economy and the homebuyer tax credit definitely helped fuel home sales.”

The Warren Group said December home sales in Massachusetts increased 16.8% from a year earlier. December was the sixth consecutive month single-family home sales increased statewide. December’s median home price rose 10.4% to $295,000, the first annual increase in the monthly median since September 2007. Bank-owned properties represented 4.5 percent of all sales in 2009, down from 5.2 percent a year earlier.

Condo sales fell 6.8 percent from the prior year, which was the fewest transactions since 1996. Still, sales rose 29 percent in December compared with a year earlier, the fourth consecutive month that condo sales increased in the State. The Warren Group also reported that 5.5 percent of condo sales involved bank-owned condos, up from 4.5 percent in 2008.

This Week’s Real Estate Insight

There are reports throughout Southern New England that the market is starting to show signs of stabilization, we are seeing a more balanced supply of homes on the market. While unemployment remains high, falling prices, low interest rates, and the tax credit might help spur sales this Spring.

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2009 Profile of Buyers and Sellers

realestateinsight — Wed, 20 Jan 2010 22:00:56 +0000

When I first opened up Residential Properties in 1981, people would ask me where I worked and I would say Residential Properties…almost as a question, since almost no one knew who we were. Today, I am proud to say that the RPL Chevron is almost recognizable as MacDonald’s Golden Arches in our State.

The real estate industry today bears little resemblance to the way we did business back then. The internet has changed everything. According to the 2009 National Association of Realtors® Profile of Home Buyers and Sellers, 90% used the Internet at some point, seven years ago only 41% of buyers used the internet.

When asked where they found the home that they ultimately bought, 36% of buyers found the home on the Internet; another 36% learned of that home from a real estate agent. In 2001 48% of the people found their home through an agent and only 8% of the people found their ultimate home from the internet.

It is not always what happens, but how you react that determines your success. I am proud of the amount and quality of information we provide on residentialproperties.com. With more and more information on the web, more people are turning to a professional for help sorting through all of it. And how do people choose their agents? They look for someone with a great online presence who has knowledge of the process and the market.

This Week’s Real Estate Insight:

There are lessons to be learned from NAR’s annual profile of buyers and sellers. It makes sense to apply them. The most effective methods to bring buyers and sellers together are the Internet, working with an agent (who learns about properties through the MLS), and signs. 84% of buyers learned about their home through one of these sources. If you want to sell your home, look for an agent with a great reputation, whose company has a great web presence and good market share.

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Giving Back

realestateinsight — Mon, 21 Dec 2009 16:06:56 +0000

Growing up in Barrington, my parents taught me the importance of giving back to the community and I made it one of the company’s founding missions. This holiday season, I am especially proud of my Residential Properties family for everything that they have been doing on behalf of others. Here is just a small sampling

Providence Office Manager Ed Hardie led a caravan of cars to the Salvation Army on Broad Street in Providence as part of our participation in the adopt-a-family program. This year the Providence agents contributed to 10 families. Sandy Conca, led the drive and helped organize the getting of gifts. She got assistance from several other agents and managers, and the office responded with a conference room full of gifts.

Sandy Soares in our Cumberland office has been involved for many years in the adopt-a-family in the Woonsocket area. Her efforts as an officer of the group and her role in organizing were immense. They had 1118 families and 2310 children in their program this year. She also led the drive in the office to sponsor a family, and she and Janice Geddes spent the past week working with the group to distribute the gifts to the 1100 families.

Our Barrington office’s drive helped two families from Warren’s Woman’s Resource Center for the season. The program was organized by Becky Bishop and Marlene Manchester.

And in East Greenwich, our agents took a more cerebral approach by donating mostly new and some slightly used books for ages up to sixth grade. Marlene Robinson organized that drive which delivered over three large boxes of goods to the London Bridges Pre-School and to the East Greenwich Public Library for use.

The generosity that I see this year is especially pleasing given the state of the economy. I thank my agents from the bottom of my heart and wish everybody a very merry and healthy New Year!

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Rhode Island Home Sales Surge in October

realestateinsight — Mon, 30 Nov 2009 18:30:17 +0000

As expected, we continue to show brisk sales as people are taking advantage of great mortgage rates and the first time buyer’s tax credit. The Rhode Island Association of Realtors reported last Wednesday that sales of single-family homes rose 29 % in October in year-over-year comparisons, but as we work through the distressed listings, the median sales price continued to decline

Here are the highlights of the RIAR report:

787 SF sold, compared with 621 last year.
The median sales price was $200,000, down from $215,000 during October 2008
22% of sales were distressed properties
The median price of sales without short sale or foreclosure was $230,000

The multifamily home market fell slightly in year-over-year comparisons:

187 sales in October 2009, down from 193 a year earlier, a 3.1%drop.
The median price fell from $116,000 to $110,000.
18.6 % of those were distressed sales.

Condos had a 35% increase in sales in October compared with the last year:

111 sold compared with 82 a year earlier.
The median price fell 29 % to $161,000 from $227,500.
21 % of the sales were distressed.

With Mortgage rates at historic lows, and lower prices, home affordability conditions are the best on record since 1970. The expanded tax credit should drive the spring market; helping the move-up buyer as well as the first-time buyer. Since potential buyers have until April 30 to have a contract in place, we should continue to see robust sales through Spring.

This Week’s Real Estate Insight:

By the time the credit expires, we should have worked though enough inventory that prices stabilize or even increase slightly, then the market could stablize because buyers won’t be paralyzed by worry about further decline in home values.

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