Asheville Mortgage Rates Sink to Record Lows Again!

Back in the 1950’s my parents purchased a home they paid 4.5% interest for 40 years and that was a special government program that was only honored for one year trying to get homes sales going again. I remember my parents bragging to people on the low interest rates.

Well over the last year we have seen some interest rates at a 60 year low. A 4%, 30 year fixed plus a Five year fixed 3.5% ARM.

So listen to this - Fixed mortgage rates dropped even more this week, continuing the trend in reaching new record lows. The 30 year fixed-rate mortgage averaged 3.94% this week while 15 year rates sank to 3.21%.

Could they drop lower? Here is the deal; normally buying a second home your interest rate would be about 1% higher so based on the current interest rates you would still fall under 5%. Most likely around 4.5-4.7% for a 30 year fixed mortgage and even lower with other available packages. Many are taking advantage by buying their Asheville Mountain log Cabin and putting it into a rental program until they retire and use it as added income.

Again I ask will they drop again. What do you think?

Time To Buy a Bank Owned?

As Foreclosures continued to fall as it has over the last year effecting the number of Bank Owned properties coming on the market for example in November, dropping 3% from October and 14%  compared from a year ago. Asheville Real Estate seems to stay with the national average.

Repossessions are down 45% compared to September 2010. But a new wave of foreclosures may be looming in the New Year, experts warn. However I do not believe this will have an alarming effect on home prices. As in many areas home sales are starting to increase and appraisers will have more inventory to use as comps rather than Bank Owned, Short Sales and Foreclosures.

As missed payments drop as they have so far this year by 8% with lenders this will also affect the number of foreclosures. Another good sign for sellers as home price per economist will start stabilize by spring of 2012.

Because of the shortage of good bank owned properties over the last several months when a new wave of foreclosures becomes available they will be gobbled up quickly by investors that have been waiting.

This is the time to get serious about buying as the economy improves interest rates will increase and prices will stabilize. When prices stabilize in most cases that is the beginning or prices going up as inventory depletes.

The Federal Reserve Leaves Rate Alone!

After my last Blog about the Federal Reserve I thought I would follow up on their Tuesday meeting. The good news is we will continue to see low interest rates until mid 2013. This does not mean as the economy improves and unemployment continues to drop we will not see some increase. A 1 or 2% increase can make a big difference to a family trying to qualify for a loan when their monthly mortgage payment increases $200.00 a month. Most likely those that are on the fence of qualifying may need to adjust to a lower priced home. Anyways the Federal Reserve will keep interest rates low and opted to not take any new measures to help the economy, as they feel the economy is already showing signs of improvement.

The Federal Reserve said the federal funds rate which serves as a benchmark rate for many types of loans, including mortgages will remain near zero until mid 2013.

The Fed feel the economy has steadily been showing signs of improvement and is on track to post its strongest gains of the year in the final months of 2011. This is encouraging and will set a nice pace for 2012.

As I look at properties for Clients there are more now than ever going under contract and the Holidays is always a strong time for Asheville Real Estate sales.

As Florida and other areas improve in home sales Asheville Area second home sales will improve and as the baby boomer continues to think about retirement the Asheville mountain area will continue to increase in real estate sales. It would appear that 2012 will be the year we start see a taste of an improving real estate. As predicted by the economists spring of 2012 will see home price stabilizing.  

So things are looking up for the Seller as bank owned property inventory depletes along with general homes for sale is will allow the seller to wait for the right buyer willing to come closer to their asking price.

It seems when I talk to a lender they tell me the rates could be going up but when the Federal Reserve tells us they plan on keeping the short term interest rates at nearly zero until 2013 it does not sound like we will see any spikes in the near future.

So where are rates heading? Today after the Fed’s meeting we may get a feel what the outcome for short term interest rates will be.

An unusual move the Federal Reserve when it reveal its predictions for future actions on interest rates to the public last summer makes me wonder will this start being a new practice or just a onetime shot hoping to help the economy?

If the Feds adopted doing a forecast, it likely would predict where interest rates are heading for the next three years, and it would be similar to the forecasts it already publishes about economic growth, unemployment, and inflation four times each year, The New York Times reports. 

So my guess is that interest rates will continue to stay low for most if not all of 2012. If the economy continues to get better and unemployment continues to improve we may see some modest increases. But with a Presidential election year coming up I do not believe we will see anything other than stimulus programs coming from the Government.

 Asheville Real Estate will increase in 2012 as predicted by economist and I agree will see market prices stabilize by spring. Waynesville and Maggie Valley Real Estate will pick up in 2012 but prices will not stabilize until later in the year when second home sales increase and those wanting to retire are able to sell their homes. However because of the strong short term rental demand investors are taking advantage of the low prices and interest rates.

The way Bank Owned properties may be handled in the future for example Bank of America is considering a program that would allow investors to buy a foreclosed home and then rent it back to the former home owner. If this becomes a practice with lenders this would keep the bank owned inventory from increasing and would also help stabilize prices.

In 2012 all that has to happen is the interest rates increase slightly and home price start stabilizing and those on the fence will start moving forward with their purchase. I recently made an offer on a property for a Client and someone came in right after us with a full price offer and walked away with it. Man is this mean we will start tasting some of the past again as real estate improves?

This is for the birds! Living in Western North Carolina we all have to make some
adjustments for the winter months. So please don't forget our feathered friends that stick
around with us for the winter. Like most of us, their eating habits change and require
different foods to provide warmth and energy to survive those fluctuating cold
temperatures. Suet, black oil sunflower seeds,cracked corn,unsalted shell free peanuts
and millet are great selections for most varieties of birds. Nyjer or thistle seed are
choice for finches. Just make sure it is kept away from moisture and put small amounts
at a time to ensure fresh and rancid free servings. If possible, place a heated bowl of
fresh water close by.....I use an old heated dog bowl.

With shorter days and longer nights they also need cover to rest and keep warmer
longer so any bird houses or coops are appreciated. Clean them out from old nests as
some parasitic insects can survive in them until spring. These are just a few
suggestions. We all need a little help to survive the winters!

By Sheila Mills

Asheville Homes Still A Great Investment!

When there is something going on in my life often times it feels like it will last forever. Over the last 5 years watching the economy spiral downward and my carrier being in Asheville Real Estate felt like it will never end. But I am glad the consumer feels different about investing in a home as 62% of Americans say that buying a home is a good investment.

So what now? It is hard to step out of the present and looking at the future but that is how investors make the bucks. They seem to be able to separate the now and tomorrow to find ways to better their life style.

I have a friend that is a Waynesville Real Estate broker found out how it works by accident, that in order to help keep his business flourishing started renting out his home to seasonal visitors and found it very profitable. Now he is converting his barn to an apartment getting ready for next year. Well here again investors have been taking advantage of this for several years now buying up homes and turning them into seasonal and long term rentals.

So here is the deal – financing on a rental is around 4.5% thirty year fixed or if it is going to be your primary residence 4.0%, thirty year or an ARM at 3.5% and the lender pays you loan costs.

So let’s say you buy a Maggie Valley log home for $200,000 with 10% down as a rental. Your monthly payment would be $962.70 plus taxes and insurance for let’s say $1,200 a month. You will have 27 weeks for potential opportunities to rent it out but you decide to only rent it out for 19 weeks and let family use it the rest of the time. You should be able to rent it of $1,500 to $1,800 a week but we will say $1,500.00 the total is $28,500. Plus 5 to 10 years down the road you will have earned some equity by paying down the loan a most likely the value of the home has increase. So how is that for a suggestion? The other option is to rent it out long term and have income each month as rents are hot right now. Or you could leave your money in that Money markets earning 1-2% each month.

They say spring of 2012 real estate will start making the turn and frankly we are seeing it already. So do we still feel it is going to last forever or should we stand with the investors and move forward?

Your call!

When You Sell Your Asheville Home Will It Appraise.

Frankly I believe many of the appraisals are flawed and keep deals from closing. Recent cases that have fallen apart are because the appraisal came in to low because they used bank owned sales to compare. This hurts the seller with often time a big short fall on the mortgage but is another opportunity for the Buyer and I believe is one reason for holding back the housing market’s recovery.

Comparing a home under contract that is not a distressed property or newly built to foreclosed homes that have sat vacant and are in disrepair is not right!

Let’s say you go to a car dealer and want to trade in your car on a new one. When they appraised your old car they used the rusted dirty and dented cars in the back to come up with the trade in value. How would we feel about that?

I believe that is not fare. I understand there may not be enough homes in the area that have sold within the last six to twelve months, it is impossible to go and look at each one to see what damage had been done to the distressed home so what can be done?

We need to go outside of the box and seek out like neighborhoods perhaps further away. Lenders often workout deals with companies that are located outside of the market so they send appraisers that have no idea of values for the community. This must stop!

Many lenders stopped loaning on new construction because the cost of building is too high. I always that in the past appraisal considered the cost to built a like home. Gee when did that go away?

Perhaps there is a local appraiser that could commit on this blog and give us some insight. I am not pointing fingers really! And I know Asheville appraisers do not have it easy and I would love to hear their thoughts.

Asheville Home Prices Mostly Stabilize!

On a national bases improving job picture and home prices stabilizing are all signs that point to a housing recovery, Barclays Capital analyst Stephen Kim told Housing Wire.

So what is Stephen Kim smoking? I truly believe the things are getting better but prices will continue to drop until spring of 2012. There are some pockets in Asheville that also include Waynesville, Maggie Valley and Weaverville that home prices are stabilizing. But it is going to take some time before the majority of the population gain confidence in the economy. But I do believe it is just around the corner.

During the holidays and winter season is a great time to buy an Asheville Home as many Sellers become more willing to negotiate with a strong buyer. Plus after the season has passed they realize they missed the opportunity and need to move their property. As most economists believing homes will stabilize by spring means over the next several months may be the last time to take advantage of great prices.

Why are the holidays such a good time to sell? This is a good time to put your home on the market as more serious buyers come out during the holidays and winter months.

Ok what kind of real estate blog would it be if we did not talk about Mortgage interest rates? Still a 40+ year low. In fact some say it is the lowest it has been in 60 years. I am seeing loans at 4%, 30 year and 3.5% for an ARM with no closing costs? So does it get any better than that?

So as the long awaited turn in the economy starts and we start reading as we have over the last several months some positive things about improvements it would seem 2012 could be a great start to recovery.

Waynesville North Carolina - It is hard to believe six years ago Sheila and I came to visit Asheville to look at investing in property and someone suggested we go to Waynesville. So I asked - Waynesville I never heard of it. So we got a map located Downtown Waynesville and started heading that way in the middle of December.

To my surprise it was all decorated up for Christmas and was so charming. It looked like a town that should be placed on a post card.

We did not know Waynesville is a historical lively town established in 1818 nestled in the Great Smoky Mountains National Park with magnificent mountain views of the Blue Ridge Parkway. Unlike many towns Waynesville has unique shops, art galleries, cafés and restaurants are all within walking distance on Main Street's tree lined brick sidewalks in Downtown Waynesville. Its historic buildings, relaxing benches and quaint charm make Waynesville a thoroughly enjoyable place to live and visit.

We sold our real estate business in Florida and have been helping families find the right home in the Waynesville area that also includes Asheville, Maggie Valley, Weaverville and Fairview to name a few.

We have found that Waynesville Real Estate if very different than other areas in North Carolina. With the farms and majestic mountains it offers that beautiful cabin feel with panoramic views that must be experienced as there are no words to describe it. Or enjoy living in a Country Club atmosphere with breathtaking views and well designed golf courses.

The average Waynesville home sellers for $157,000 but ranges from $75,000 to Millions depending on what type of life style you are looking for.

If you are looking for a summer getaway or a wonderful place to slow down a little and enjoy life Waynesville area may be the perfect place for you.

Come visit us.

Should You Believe Everything Your Realtor Said?

Over the last several years my Clients have been asking, is it time to buy or should we wait. As a real estate professional I have a hard time answering that question. Will prices continue to go down? Will interest rates go up? What about the economy? All these factors are important when trying to make that right decision.

As a Realtor I do have a responsibility to give my Clients a straight honest answer and leave my optimistic hopes out of it, but that is hard to do at times. If you look at the national figures and read the articles from those that make a living from predicting the future do not seem to know either. However they generally are saying prices will stabilize early in the spring of 2012.

Asheville Real Estate, this also includes areas like Waynesville, Maggie Valley and Weaverville areas seem to be starting a little earlier in some areas. The Asheville home sales this year has been up overall matching 2007. If you remember 2006 was the last of record real estate sales and high prices.

Areas like Grove Park and Biltmore Park to name a few are seeing some strong sales and prices have stabilized. On a National level sales are up over last year 11.3%.

Publications like Wall Street Journal, Market Watch and JP Morgan are telling consumers this is the time to buy. But wait a minute if prices may be going down the first of the year should we wait. I guess that is something to consider. Here is a thought if prices are going to start stabilizing early spring when is it a good to consider buying I would say in the winter. So winter is all but here.

Ok, there I go again with my optimistic hopes coming out. Shame on me!

Let me give you an example. In Grove Park there are 22 homes currently on the market and so far this year there has been 30 sold. Grove Park homes are selling faster than there is inventory so prices have stabilized and in some cases are starting to increase. Biltmore Park there is 50 properties for sale and 24 sales this year. One out of ever two Biltmore Park homes will sell.

Downtown Asheville condos are selling quickly as investors, retirees or soon to retire is taking advantage of the low prices.

The economists say home prices are equivalent to 2003. I believe in the Asheville market it is equivalent to 2001. But I have included this graph showing the difference between buying a home in 2003 compared to today.

So if you have stayed with me through this blog I ask you do I sound like an optimistic real estate agent or an informed Realtor?