Real Estate Information Archive

On 30 July, changes to the Truth In Lending Act regulations came into effect.   These changes can significantly alter the amount of time it takes to finance a home purchase.

This video - from ThinkBigWorkSmall.com, explains the parts of the Housing and Economic Recovery Act (HERA) that established new requirements for lenders and mortgage brokers for Good Faith Estimates (GFE) and Truth In Lending (TIL)disclosures.  The video is geared to mortgage brokers and Realtors, so a lot of the content will be gobbledegook to most of you - but the salient points come through clearly.

Click here for the Video: HERA Is Not Your Hero in RE

In Georgia, these changes may not have the extensive effect the video implies - mainly the additional 14 days it may now take to get a mortgage - because our contracts already have built-in due diligence periods and financing contingencies that should accommodate these changes with little impact.

The regulations can affect YOUR closing - whether as a Buyer or a Seller - if the Buyer decides to change loan products or the rates change and the Buyer wants a lower rate.  The margin of error is small - if there's a difference of more than .8% in the GFE/TIL from the initial application and the FINAL costs to the Buyer - then the three day disclosure period comes in to effect, which WILL mean you cannot close until three days after the Buyer physically gets the new GFE/TIL.

Anyway - hope this is of use to some of you!  Let me know if you need any more info - and as always - I relish your comments!

Seems like it might be time to eat a little humble pie and pull back on my projections for April's numbers.  Things are actually looking better!

Pending and Contingency properties as of this writing also appear to point to a robust May, with 719 properties revealed in a quick-sort of Pending sales.  A good number of these will either not close until June or July, and some may just be clerical errors, but I would still suspect we'll get close to - if not exceed - 500 sales for the month of May.

Late postings and other adjustments continue to drive the April sales figures beyond my expectations.  As of this afternoon, there were 400 closed residential (all types) listings in the MLS for April - a number that is sure to go up slightly before the reports are generated on about the 10th.   This exceeds the March sales figure of 389 properties - a good sign since the Masters Golf Tournament (always the first full week of April) usually puts the kebosh on a full week's worth of Buyer traffic in the area. 

The $8,000 Tax Credit, low mortgage rates, and extensive Seller offered-incentives will hopefully help us begin a moderate summer selling season, as we head in to a projected recovery in early 2010.

1^st Quarter August GA Home Sales Summary

Well, it’s time to take a good hard look at how the 1^st quarter numbers of 2009 stack up, so here goes:

- Overall sales are down 17% on 2008 figures for the first three months of the year.  March sales rebounded to 11% down on March 2008, much better than January (down 24%) and February (16%) – so that 17% figure may go lower as we enter the better home sales months.

-  Expect April figures to decline slightly.  A full week of out-of-town guests for the Masters Golf tournament always puts a damper on the April sales figures – and I expect that trend to continue.  Since 2003, only one year saw an increase in residential says in April over March – 2006.  Every other year in that period has shown decreased sales activity for April over March.

- The average sales price for March of 2009 was $157,959 – almost $4,500 higher than the same period last year.

- Richmond and Columbia County continue to pace sales in the CSRA – with the west Augusta and south Augusta regions posting slightly higher totals than the Martinez/Evans/Grovetown (North of I-20) corridor of Columbia County.  Harlem and Appling continue to post weak sales figures – reflecting the smaller population of those areas of the county.

- As of this writing, 30 year conventional mortgage rates in the Augusta area are hovering close to the 4.65% mark, with VA and FHA rates also well below 5% - continuing the historical lows we’ve seen for the last several months.  There will probably never be a time period in my lifetime when homes are this affordable.  

THE BOTTOM LINE:  If you are selling – get your home on the market sooner than you planned.  We continue to weather the mortgage crisis storm and inventory is still high.  This is hand-in-hand with Gary Keller’s Vision Speech from the Keller Williams Family Reunion.  I’m paraphrasing, but he said in February that “the next six months will probably be the worst economic times you will ever see in your lifetime.”   With over 400,000 ARMs adjusting in 2009, there will continue to be foreclosures at record levels.  Expect things to bottom out by August, with the housing market posting a mild turnaround by the early 2010 months.   

If you’re buying, you probably won’t see this level of choice again for quite some time, and the concessions offered by Sellers in this market are phenomenal.   Interest rates are still historically low – how long that will last is anyone’s guess.   I certainly see rates continuing below 6% through at least November if not longer.

At the end of the day, good homes sell in any market.  If you are a First Time Homebuyer or have not purchased or a primary residence in the last three years, this is a perfect time for you - the $8,000 Tax Credit is an outstanding incentive.

Well, Sherri and I have wrapped up our first year at Keller Williams Realty Augusta Partners, and at the beginning of this month - I took some time to look over the market statistics for the year and see if I could get a feel for what 2009 may be like.

The 2008 residential sales figures were down 22% over 2007's sales, but 2007 was the second best year ever in the Central Savannah River Area (CSRA).   All in all, 5,011 homes sold in the Augusta area last year.

Townhome sales where a bright spot in a down year.   With 529 townhome sales in 2008 - it became the second best year ever for "residential attached" sales.   For comparison 2007 was the best year ever, with 532 total sales, while the third best year fell way short of both - 2006, with 393 sales.  Proof positive that what we're really going through is an affordability crisis rather than a mortgage crisis.

The "sweet spot" of the housing market was between $100,000 and $179,999.  That sector accounted for fully 46% of all sales.  

The luxury market suffered the most.  Homes with a list price over $350,000 accounted for 6% of all sales.

The best news of the year comes from inventory reduction.  The number of available homes dropped every month since June of 2008 at a high of 4,713.  The end of December number of 3,955 represented a drop of 758 properties or 17% - the steepest drop in available inventory in MLS history.  Since real estate is a supply and demand industry - this is a good sign we may be near the bottom of the trough of this Buyers Market cycle.

Despite all the gloom and doom, CSRA sellers still received - on average - 97% of the list price of their homes when they sold.  This edifies recent media reports of Augusta continuing to see mild appreciation in a nationwide trend of negative appreciation.  When you consider all the foreclosures that get lumped in with those statistics, it's probably more like 98-99% on a regular Seller-Occupant to Buyer-Occupant transaction.

I'll keep more market news in here as things evolve - please feel free to let me know what you think.  I can also send you the reports that back up my data - just drop me a line and I'll get them to you.

All in all Augusta numbers were down, it is tougher to sell your home, and you need to have agressive pricing and excellent terms to offer Buyers if you intend to sell.