Tuesday, February 28, 2006

January Home Sales Down

The California Association of Realtors® (C.A.R.) reports that "The median price of an existing home in California in January increased 13.8 percent and sales decreased 24.1 percent compared with the same period a year ago".

While the market is slowing, the CAR is predicting an increase in sales as we head into the historically more active spring market.

To read more: January 2006 home sales in California.

Sunday, February 26, 2006

Zillow.com - property valuation website

A new website has gone online in February ... zillow.com. Finding the value of a home is simply found by entering the address of a property. It's free, and you don't need to "register" to use the website. In addition to the valuation of a property, there is additional information available on the website.

In our test, we can tell you that we had surprisingly results for some addresses, while other properties did not. The website states it is a beta site. The website states that "We have lots of data in some areas, but little to no data in others."

Test it out and see!

Friday, February 24, 2006

Long term mortgage rates down - for the first time in 5 weeks

But, short term mortgage rates are up. According to Bankrate.com, "The benchmark 30-year fixed-rate mortgage fell 3 basis points to 6.34 percent...One year ago, the mortgage index was 5.72 percent; four weeks ago, it was 6.17 percent...The 15-year fixed-rate mortgage fell 3 basis points to 5.99 percent. The 5/1 adjustable-rate mortgage rose 3 basis points to 6.08 percent."

To read more: February 22 mortgage rates report

Wednesday, February 22, 2006

New Homeowner Tax Credit

Have you heard of it? The Energy Policy Act of 2005 (EPACT).

The U.S. Department of Energy website says it "offers consumers and businesses federal tax credits beginning in January 2006 for purchasing fuel-efficient hybrid-electric vehicles and energy-efficient appliances and products. Most of these tax credits remain in effect through 2007."

More specifically, with regard to the "Home Energy Efficiency Improvement Tax Credits" available:

"Consumers who purchase and install specific products, such as energy-efficient windows, insulation, doors, roofs, and heating and cooling equipment in the home can receive a tax credit of up to $500 beginning in January 2006.

"The EPACT also provides a credit equal to 30% of qualifying expenditures for purchase for qualified photovoltaic property and for solar water heating property used exclusively for purposes other than heating swimming pools and hot tubs. The credit shall not exceed $2000.

"Improvements must be installed in or on the taxpayer’s principal residence in the United States. Home improvement tax credits apply for improvements made between January 1, 2006 and December 31, 2007."

The U.S. Department of Energy also goes further to advise that "Some consumers will also be eligible for utility or state rebates, as well as state tax incentives for energy-efficient homes, vehicles and equipment. Each state’s energy office web site may have more information on specific state tax information."

To read more: The Energy Policy Act of 2005

As always, check with your tax advisor/financial advisor.

Monday, February 20, 2006

Mortgage interest deduction appears safe

As we reported on in our October 16, 2005 post, one of the possible tax provisions that might be amended as part of proposed reforms being studied is the mortgage interest deduction, including the possible limination of the deduction.

Well, President Bush's addressed the issue this week in his comment, "I don't think you have to worry about the mortgage deduction not being a part of the income tax law."

We note that in our opinion, this still raises the possibility that the mortgage interest deduction might be adjusted in some fashion.

Further, President Bush did sound a warning about interest rates continuing to increase.

Saturday, February 18, 2006

Foreclosures Increasing in Califoria

DataQuick News reports that the number of foreclosures in California increased in the last quarter of 2005. Attributing this to lower appreciation rates, DataQuick reports that "Lending institutions sent 14,999 default notices to California homeowners during the October-to-December period. That was up 19.0 percent from 12,606 for the third quarter, and up 15.6 percent from 12,978 for 2004's fourth quarter...Foreclosure activity hit a low during the third quarter of 2004 when 12,145 default notices were recorded. Defaults peaked in 1996's first quarter at 59,897. DataQuick's default statistics go back to 1992."

To read more, go here: Increasing foreclosures in California

Wednesday, February 15, 2006

Home sales at lowest level in five years

DataQuick Information Systems reports that "The number of Southern California homes sold in January edged down to the lowest level in five years as many potential buyers decided to sit on the fence during the real estate market's off-season."

Just how far off are sales? DataQuick says 30% from December's sales levels, and down 7.4% from last January's numbers.

Noting that this is typical for December to January sales, the 30% decline may be an indication of what is to come this year.

To read more: January sales from DataQuick

Monday, February 13, 2006

Mortgage rates on the rise ... again

Our weekly check-in with Bankrate.com shows that for the week ending February 8th, "The benchmark 30-year fixed-rate mortgage rose 4 basis points to 6.32 percent...One year ago, the mortgage index was 5.59 percent; four weeks ago, it was 6.22 percent. And on June 30, 2004, it was 6.3 percent."

The online article also states cash-out refinances are popular right now, being used to consolidate loans and put money in the pocket of the borrower. "Some analysts believe that the Fed is leaning toward another hike at the end of March, an action that would boost rates on credit lines even more. That would give homeowners more reason to do cash-out refinances and pay off their credit lines."

To read more: February 8 mortgage rates

Saturday, February 11, 2006

December Housing Index shows declining affordability

The California Association of Realtors® (CAR) reports that "The percentage of households in California able to afford a median-priced home stood at 14 percent in December, compared with 19 percent for the same period a year ago."

"At 24 percent, the High Desert region was the most affordable C.A.R. region in the state, followed by the Sacramento region at 19 percent. Santa Barbara County was the least affordable region in the state at 6 percent, followed by the Northern Wine Country region at 7 percent."

If interest rates continue to climb, we may see a bigger gap in the number of Californians able to afford a home.

To read more: December 2005 housing affordability index

Thursday, February 09, 2006

Mortgage Applications down slightly

The Mortgage Bankers Association (MBA) announced for the week ending February 3, "The Market Composite Index — a measure of mortgage loan application volume was 619.3 – a decrease of 1.2 percent on a seasonally adjusted basis from 626.8 one week earlier. On an unadjusted basis, the Index increased 2.2 percent compared with the previous week, but was down 16.4 percent compared with the same week one year earlier."

The MBA goes on to say that "The refinance share of mortgage activity decreased to 42.1 percent of total applications from 43.0 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 29.8 percent of total applications from 30.5 percent the previous week."

To read more: Mortgage Application Volume February report.

Wednesday, February 08, 2006

Who do you trust?

A Gallup Poll measuring honesty and ethics in different professions shows that real estate agents are #11 on the list of 21 professions measured. Nurses top the list, followed by pharmacists, medical doctors, high school teachers, policemen, and clergy. And, those professions below realtors? That would be building contractors, lawyers, labor union leaders, senators, business executives, stock brokers, congressmen, advertising executives, and car salesmen. At the bottom: telemarketers.

Sunday, February 05, 2006

Mortgage rates rise

Bankrate.com reports that for the week ending February 1, mortgage rates have risen sharply. "The benchmark 30-year fixed-rate mortgage jumped 11 basis points to an average of 6.28 percent ... It had not been that high since the last week of 2005, when it also was 6.28 percent."

Is this a result of the recent rate hike by the Feds? Bankrate.com says it isn't: "The Federal Reserve's rate hike Tuesday was so widely anticipated that it didn't affect mortgage rates. The bond and mortgage markets already had factored it in."

Possible inflation worries might be contributing to the mortgage rate rise.

To read more: February 1, 2006 mortgage ratesa

Friday, February 03, 2006

Pending Home Sales Index Down

The Pending Home Sales Index of the National Association of Realtors® (NAR) for the month of December, 2005 was down 3% from November. This index measures the number of pending sales for existing homes (not new homes). The trend over the past year has been steading down since the high in August. The NAR cites rising interest rates as having an affect on the market.

To read more: Pending Home Sales Index

Wednesday, February 01, 2006

Federal Reserve raises rate

For the 14th straight time (the longest run in 25 years), the Federal Reserve has raised the federal funds rate to 4-1/2%. This was the final meeting chaired by Alan Greenspan. The next meeting is March 28th.

We will watch the mortgage interest rate reports to see what happens on the "home front."

To read more: Federal Reserve press release