Things to Consider Before Buying a Distressed Property

As buyers are drawn to distressed properties there are some things to consider. I have found as far as Asheville Real Estate the number one reason a buyer is interested in distressed properties is the bargains as you can save 20 to 40% on the average compared to non-distressed homes.

Here are some suggestions that you may want to consider before buying that bank owned property.

Regardless if you have purchased a distressed property or if this is the first time I would suggest buying only Bank Owned (REO). New buyers may want to avoid short sales, which often come with lengthy negotiations or foreclosure auctions that often require all cash payments.

Bank Owned (REO) properties can be similar to a traditional home sale in some ways and can offer some of the big savings.

We find that most distressed properties are sold as is and it is a good idea to have an inspection done. Many of the distressed Asheville Homes I have shown need repairs and lots of paint.

Often an inspection that shows a lot of damage can be beneficial when negotiating for a better price and could be well worth the investment before making an offer.

We are finding as the inventory for distressed properties gets smaller, investors continue to take advantage of the low prices and banks are not foreclosing as quickly as the past it is just a matter of time the lender will not be willing to negotiate as they do now.

Distressed properties can be a good investment if thought-out well. Having a good Broker to keep you in a good area and help you through the process can be very helpful. There is one thing that never changes in real estate location – location.

Asheville Mortgage Rates Drop Sharply This Week

In Asheville and across the country 30 year fixed rate mortgage, the most popular choice among home buyers, dropped to its second lowest reading on record this week.

Because of the Market concerns over the European debt market drew investors to U.S. Treasury securities, lowering bond yields and mortgage rates.

Because of the low interest rates Asheville Real Estate and areas like Waynesville and Maggie Valley are starting to see continued upper ward swing in home sales.

Here is how rates fared for the week:

• 30-year fixed-rate mortgages: averaged 4 percent, with an average 0.7 point, down from last week’s 4.10 percent average. The 30-year fixed-rate mortgage is the second lowest on record, just behind the 3.94 percent record reached on Oct. 6. A year ago at this time, 30-year rates averaged 4.24 percent. 
• 15-year fixed-rate mortgages: averaged 3.31 percent, with an average 0.7 point, falling from last week’s 3.38 percent average. Last year at this time, 15-year mortgages averaged 3.63 percent. 
• 5-year adjustable-rate mortgages: averaged 2.96 percent this week, with an average 0.6 point, dropping from last week’s 3.08 percent. At this time last year, 5-year ARMs averaged 3.39 percent.
• 1-year ARMs: averaged 2.88 percent this week, with an average 0.6 point, dropping from last week’s 2.90 percent average. A year ago at this time, the 1-year A

Will the Federal Reserve Save Real Estate?

Yesterday the Federal Reserve realizes the importance of fixing the housing market and which could then have a trickle effect in strengthening the rest of the economy.

They are considering buying more mortgage backed securities to help. Such a move could send borrowing costs even lower. 

Problems in the housing sector are a big reason why our economy's not recovering more quickly. We should know the outcome today as they are  holding a two day policy meeting which ends Thursday to weigh options. 

I do believe that if more people were buying homes it could lead to a boost in consumer purchases for other sectors, from furniture to appliances and have an effect on jobs.

Asheville Real Estate seems to be moving an upward swing and this could have an effect on stabilizing Asheville home sales. This fall has been very strong however the past has told me it will slow again. The Feds could help keeping real estate sales on a steady pace. The housing market continues to be bogged down by a high rate of foreclosures, which is dropping other home values.

So I will keep you posted.

Asheville Real Estate - More Borrowers Seek Closing Costs From Sellers

It seems to me that more Asheville home Buyers are asking the Seller to help pay some or all of their closing cost. As closing cost increase I have been writing more contracts adding that the Seller a Closing pays the closing cost, another indication of a Buyer’s market. This is not new as FHA has allowed the Seller to pay up to 3.5% of the Buyers costs for years now and the VA loans also allow it.

Also in Asheville, Waynesville and Maggie Valley I am seeing mortgage rates hover around record lows, more borrowers are opting for no-closing-cost loans. With these loans, borrowers accept a mortgage interest rate that may be anywhere from a quarter to a full percentage point higher than they would ordinarily qualify for so they can receive a credit toward their closing costs. 

With higher mortgage rate will increase a monthly payment for the duration of the loan. Also, the credit on closing costs typically covers fees charged by the lender like origination fee, underwriting expenses, and appraisal, but often doesn’t include the title insurance, mortgage-recording fees, insurance, and escrow fees.

Those borrowers who stayed in their home for the national average of seven to eight years could come out ahead with the higher mortgage rate using the alternative loan structure. So if you are a home buyer or thinking about it this is the time, if you’re a seller your home in the Asheville, Waynesville and Maggie Valley most likely your home is worth more now than next year and it is time to be flexable.

Are You Planning to Trick-or-Treating This Halloween

For your information and if you like to travel here are the top cities to Trick-or-Treat, San Francisco emerged on top as the best city to go trick-or-treating this Halloween. Here are the 10 cities that emerged on top for best trick-or-treating spots. Asheville I believe should be one but did not make it as Asheville Real Estate is up and we have great neighborhoods with little crime.

1. San Francisco

2. Boston

3. Honolulu

4. Seattle

5. Chicago

6. San Jose, Calif.

7. Washington

8. Los Angeles

9. Philadelphia

10. Portland

Stay away from Casper the Ghost... OK did I just date myself?

Happy Halloween!

Asheville Mortgage Rates Mostly Hold Steady This Week

In Asheville for the second straight week, fixed-rate mortgages continued to mostly stay near 60 year lows. This is contributing to the strong fall sale.

Nationally fixed mortgage rates followed other long term interest rates and showed little change, on average, from the prior week. The latest monthly housing market indicators were mixed, with consumer confidence soft, house prices largely flat and new home sales up from very low levels. Asheville Real Estate however continues to be strong with September matching 2007 numbers as buyers trying to take advantage of the low interest rates and before prices start stabilizing.

Here is a closer look at mortgage rates for the week ending Oct. 27:

• 30-year fixed-rate mortgages: averaged 4.10 percent, with an average 0.8 point, which is down from last week’s 4.11 percent average. A year ago at this time, 30-year fixed-rate mortgages averaged 4.23 percent. 
• 15-year fixed-rate mortgages: averaged 3.38 percent, with an average 0.7 point, which is the same average as last week. Last year at this time, 15-year fixed-rate mortgages averaged 3.66 percent. 
• 5-year adjustable-rate mortgages: averaged 3.08 percent this week, with an average 0.5 point, slightly up from last week’s 3.01 percent average. Last year at this time, 5-year ARMs averaged 3.41 percent. 
• 1-year ARMs: averaged 2.90 percent this week, with an average 0.6 point, which is down from last week’s 2.94 percent average. A year ago, 1-year ARMs averaged 3.30 percent. 

Asheville home sales seem to continue a strong upward trend and new home sales have increase some. Investors are still taking advantage of bank owned properties trying to meet the strong rental market.

Asheville New Homes are selling quickly and the number of new homes sold in September 6% from the month prior, higher than analyst expectations..

This is the highest reading since April and a major reason why the available number of new homes for sale is getting smaller. 

For Asheville Buyers, as builder confidence rises, it becomes more difficult to negotiate for upgrades and price reductions on a new home. The great deals that can be had are getting scarce.

It is likely that mortgage rates will sustain their low levels into 2012 with perhaps small increases. But the rising home prices with resale and new Asheville Homes make it very attractive to buy now. 

With investors buying up bank owned and turning them into rentals trying to meeting the rental demand, the increase in home sales and 40 year all time low interest rates there has never been a better time to buy.

Asheville Renters Spending 5% More Than Home Owners

Asheville rentals are in demand as a National level as well. The rising rents are now forcing renters to outspend home owners on housing costs, as home owners are able to buy at the lowest cost and record low mortgage rates according to a new study. 

On a national level since 2005, home owner’s housing expenses have increased from 31.9% of their household budget to 33.2%. On the other hand, in that same time period, renter’s expenses have jumped from 35.6 percent to 38.4%. In the last 26 years, home owners have increased the amount they spend on household expenses by 12% while renters have increased it by 22%.

Economists noted that for the first time in 30 years the median monthly mortgage payment is about the same or less than the median rental payment. 

As in the past there is that question why rent when you can buy. Of course there are good reasons with many renters as they have lost their home from foreclosure or Short Sale. I know of people buying a home today before walking away from their current property as they take advantage of the low prices and interest rates.

As Asheville Real Estate improves as it is doing now and rents increase I believe we will see a large jump in home sales and especially new homes.

Asheville Investors See Big Profits From Rising Rents

Asheville Rental demand and prices continue to rise and investors are cashing in. Because of the demand rents are rising at a 5.5% annually up from last year’s 4.6% rate.

On national bases the rental market has added about 1.4 million new renters this year, some of whom were former home owners who faced foreclosure or a short sale. Renters are increasingly showing a strong interest for single family homes owned by investors. 

Asheville first time investors along with experienced are growing taking advantage of distressed properties.

Western North Carolina investors are believed to make up anywhere between 20 and 40 percent of monthly existing home sales. With home prices and interest rates so low, more aspiring investors are jumping in, nearly 60 percent of investors in a recent survey by Realtor.com considered themselves newcomers to real estate investing. 

Waynesville and Maggie Valley home sales are picking up because investors and families are seeing the advantage of the seasonal rentals. By purchasing a mountain cabin, place it in a rental program use it personally for several weeks a year and the rent covers the cost.

There are so many opportunities in today’s real estate and the uncertainty of the stock market more and more people are placing their savings into real estate. It is predicted that distressed homes will continue through 2013. This is the time.

New-Home Building Soars 15% in September

While the head line looks impressive the actual numbers of new homes is not but marks a big improvement, the level still remains only about half of the 1.2 million pace that economist consider healthy for the new-home sector. 

Resale home inventory starting to deplete as sales continue to increase and now with banks starting to make more loans again after borrowers have expressed concern over the increasing trouble in qualifying for a loan today Asheville Real Estate is starting to make a comeback.

Also Nationwide 2.19 million homes were listed for sale at the end of September, a drop of 20% compared to a year earlier, and marking the lowest level compared to 2007.

Last month Asheville Real Estate home building was at its fastest pace in 17 months, rising 15% from August and posting the new home sector’s best pace since April 2010.

With the drop in inventory in Asheville Homes for sale, lenders making easier to get a loan and the low interest rates we are starting to see home prices stabilize at an already low price. In some areas Asheville home prices are starting to increase.

I am seeing some quotes from lenders for a 30 year loan in the low 4’s. Still investor sales are 1 out of four as the rental market continues to be strong.

Nationally September sales are down but Asheville home sale are up. This is the time to by before prices start to increase.