Winners of the rental economy

Rental rates have been on the rise and are projected to continue increasing. With very low interest rates, you should definitely do the math to see whether owning would save you money. If you need help doing the math, feel free to ask me--I do have an MBA so the math isn't beyond me.

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By Nin-Hai Tseng, writer-reporter May 25, 2011: 5:00 AM E

Members of the Rent is Too Damn High Party beware! Residential rental prices are on the rise. Here's who wins in the new non-ownership society.

FORTUNE -- There are still many factors discouraging even the most savvy homebuyers from purchasing a home, but a new class of renters is expected to bring a bright spot to the troubled U.S. real estate market. Prices for rental apartments are expected to rise nationally – by approximately 4.5% in 2011 and up to another 3% in 2012, according to Rent.com.

During the housing boom between 2001 and 2005, prices for rentals fell by nearly 10% as easy credit offered by banks lured many newcomers to homeownership. Since the bust of the housing market, rents have more than made up those declines as more people now question the financial merits of homeownership or simply can't get approved for a mortgage. From 2006 to 2009, rental prices on average increased by more than 15%, according to Moody's Analytics economist Andreas Carbacho-Burgos. Nationwide, the average rent today is $1,360 a month.

Experts predict rents will continue rising.

Christina Aragon, director of strategy and consumer insight of Rent.com, says this is being driven by demographic changes coupled with an improving economy and ongoing foreclosure problems hampering the market for single-family homes. Much of the demand for rentals will likely come from younger people who tend to rent rather than buy. The economic recession pushed many jobless twenty- and early thirty-somethings to crash with friends and parents, but Aragon expects that the improving job market will get them to find their own place. What's more, the number of people aged 25 to 34 is forecast to grow 1.4% per year through 2013, helping drive demand further.

Paying more to the landlord might be bad news for renters, but it could signal that better days are ahead for the overall housing market. Here are a few winners of our burgeoning rental economy.

Builders and developers

Since the bust of the housing market, residential construction has dropped to record lows. But that is poised to change as builders and developers have already begun trying to cash in on higher demand for rental apartments.

Charles Brindell, chairman of the National Association of Home Builders' Multifamily Leadership Board, says he expects apartment construction to pick up to at least 160,000 units this year, mostly in urban areas along the East Coast. This would be significantly higher, given that construction since 2009 has totaled less than 90,000 a year – the lowest in 50 years.

Brindell, also CEO of a Texas-based firm that invests and develops apartment communities, says he's bullish because of the improving job prospects for younger workers. More than 60% of jobs created in 2010 went to workers between 20 to 24-years old – the prime age group for renters. Brindell's Mill Creek Residential Trust is planning to build 3,000 apartment units this year, mostly in the Northeast including the Boston area, Long Island, New York, and Virginia.

However, while a burst of activity in multi-family homes is certainly good news for the construction sector, it is by no means enough to return the homebuilders to their previous level of activity. The NAHB index that tracks builder confidence remains low at 16 -- it was as high as 72 in 2005.

Real estate investment trusts (REITs)

It's not that homeownership is dead, but people are certainly renting more and investors have picked up on the higher demand.

REITs, which invest in commercial properties from office buildings to rental apartments – have outperformed the S&P500 since the financial crisis. In 2010, investments in apartment complexes led gains in the overall REITs market with total returns at 47%. Returns for the overall REITs market was 28%, markedly higher than the S&P500 that saw returns of 15%.

Last month, real estate investment trusts Equity Residential (EQR), headed by real estate mogul Sam Zell, and AvalonBay Communities (AVB) -- both among the nation's biggest apartment owners -- posted higher year-over-year revenue as the companies raised rents.

For Equity Residential, average rent rose 3.6% to $1,400 and occupancy rose to 95% from 94.6% the previous year on properties the company operated for a year or more. Revenue rose by 4%. And AvalonBay reported that revenues jumped 3.7% and average monthly rental rates ticked up slightly quarter over quarter from $1,873 to $1,879.

As of Monday, total returns for REITs were 8.73% (with about seven months to go), outperforming the Russell 2000, NASDAQ and S&P 500. Investments in apartment complexes continued contributing much of the gains.

Overall U.S. housing market

Given that many homeowners are still trying to clean up their messy finances, it might be hard to see how higher rents could benefit the overall U.S. housing market. In theory, at least, renting could become so expensive that it costs less to buy a house and make monthly mortgage payments.

In fact, that's happening already, even if it hasn't yet translated to a return to homeownership. In Moody Analytics' latest list of rent ratios for 54 U.S. metropolitan areas, 29 cities fell into the "better to buy" category. With many experts predicting that home prices have further to fall this year and with higher expectations for rentals, more cities could end up on the buy side of the buy-versus-rent calculator.

But much of that will likely depend on huge hurdles weighing on the housing market – namely, record foreclosure rates, high unemployment and tighter lending standards for new mortgages. Areas that continue to experience high foreclosure rates and widespread unemployment, such as Florida and Arizona, might find it more affordable to buy than rent. Yet renting will likely be king in more urban areas with more employment opportunities, such as New York and Seattle.

View original article: http://finance.fortune.cnn.com/2011/05/25/winners-of-the-rental-economy/?iid=HP_Highlight

Perspective

Not a lot of real estate agents post links to articles talking about price declines, but the corollary link is that mortgage applications continuing rising. So we continue the same stories we've been tracking--prices remain under pressure, BUT we still have people taking advantage of buying opportunities and very low mortgage rates. I would say the lesson is to keep it all in perspective, not dwell on the solely negative news stories, nor to get too excited about the positive items. Remember the mantra--if the house works for you, and your mortgage payment is affordable, and you wouldn't need to sell it next year, you don't need to be afraid of buying.

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Home Values See Biggest Drop Since 2008
Published: Monday, 9 May 2011 | 8:36 AM ET
By: Reuters

U.S. home values fell in the first quarter at the fastest rate since late 2008, real estate data firm Zillow said on Monday, suggesting that a bottom will not be seen until 2012 at the earliest.

Zillow said its home value index fell 3 percent in the first three months of the year from the previous quarter, and was down 8.2 percent year-over-year.

The number of homeowners under water—or, those who owe more on the mortgage than their house is currently worth—amounted to 28.4 percent of single-family homeowners, representing a peak since Zillow began calculating the data in 2009.

That was up from 27 percent in the fourth quarter of last year.

Foreclosures also rose, following the moratoriums that had been in place in late 2010. In March, one out of every 1,000 homes was in foreclosure.

Given all those factors, it is unlikely home values will reach a bottom this year, Zillow said, and the firm pushed its forecast out to 2012.

"Home value declines are currently equal to those we experienced during the darkest days of the housing recession. With accelerating declines during the first quarter, it is unreasonable to expect home values to return to stability by the end of 2011," Zillow chief economist Stan Humphries said in a statement.

Almost all of the 132 markets covered by Zillow saw home value declines. Only Fort Myers in Florida, Champaign-Urbana in Illinois, and Honolulu, Hawaii, managed quarterly increases.
Copyright 2011 Thomson Reuters

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Mortgage Applications Rose Last Week
Published: Wednesday, 4 May 2011 | 8:48 AM ET
By: Reuters

Applications for U.S. home mortgages rose last week, helped by refinancing demand as interest rates fell for the third week in a row, an industry group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 4 percent in the week ended April 29.

The MBA's seasonally adjusted index of refinancing applications climbed 6 percent, while the gauge of loan requests for home purchases added 0.3 percent.

The refinance share of mortgage activity rose to 62.7 percent of total applications from 61.6 percent the week before, the highest level of the month, MBA said.

Fixed 30-year mortgage rates averaged 4.76 percent in the week, down from 4.80 percent the week before.

Five Beloved Myths of the Mortgage Market

More commentary on the aforementioned Fannie/Freddie topic with this analyst pretty much saying that life would go on without Fannie and Freddie.

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By AGNES T. CRANE
Published: February 6, 2011

America’s mortgage market almost sank the world economy. But rather than rushing to fix it, the government has blown two deadlines for proposals. The ideas are finally due as early as this week from the Treasury, and those recommendations will frame the debate. But the danger is they will be based on dogma that should in fact be seriously questioned.

Proposals have been circulating ever since the previous administration seized Fannie Mae and Freddie Mac in 2008. Most agree that both entities should be wound down, one way or another. But whether government should still have a role subsidizing housing finance is still up for grabs — or rather, few seem able to resist the idea that it should, even if it is a smaller one. The trouble is that financial types have become accustomed to a government safety net, and few of the constituencies involved are willing to challenge America’s core housing myths.

MYTH 1 Significant reform will kill the housing market. Many fear any major overhaul of housing finance will slam a still tottering housing market.

THE REALITY If America scraps its current system tomorrow, that’s what will happen. At a minimum, removing the government subsidy should nudge mortgage interest rates higher, potentially knocking home prices down further. But Britain took more than a decade to phase out tax deductions on mortgage interest. Homeowners, would-be homeowners and mortgage lenders can adapt to even a potentially wrenching change if there’s a five- or 10-year transition period. The United States needs to get started on a plan.

MYTH 2 The American mortgage market is too big for the private sector to handle alone.

THE REALITY The $10.6 trillion mortgage market is huge, and Fannie and Freddie own or guarantee roughly half of it. But the size of the market — and the secondary market in securitized mortgages, and so on — was part of the problem in the years leading up to the 2008 crisis. The market is already down from its $11 trillion peak, but it is still nearly twice as big as in 2001. With the national average home price down more than 30 percent from its highs and millions of homeowners in danger of foreclosure, it’s clear only a smaller mortgage market is really sustainable.

Fully private-sector mortgages would be more expensive, but at the right price banks will lend. Studies conducted before the financial crisis suggested that government backing saved homeowners only 0.15 to 0.4 percentage point on their mortgage interest rates.

MYTH 3 Investors would stop buying mortgage bonds without government guarantees. Bill Gross, bond guru and co-head of Pimco, certainly has said he wouldn’t want to buy mortgages. Mr. Gross and others in his industry have grown used to the government guarantee. It reduces volatility and saves them some time-consuming analysis.

THE REALITY There are plenty of deep-pocketed investors looking for good investments and with the capacity to figure out their value. Again, interest rates would have to be a bit higher, and the securitization market would probably be a good bit smaller. But what existed before the crisis was unsustainable.

MYTH 4 The 30-year fixed-rate mortgage is part of the American dream.

THE REALITY It’s true that the current standard American mortgage — one with a relatively low rate of interest fixed for 30 years that can be refinanced at almost no cost — would probably be harder to get. Yet high home ownership rates in other countries prove this structure isn’t necessary to enable people to buy homes. A longish transition period would allow mortgage borrowers to get used to less generous home financing. And that’s preferable to having them pay much more down the line through their tax bills if investors need bailing out.

MYTH 5 Government subsidies promote homeownership.

THE REALITY This doesn’t seem to be the case at all. Homeownership rates in the United States from 1998 to 2008 averaged 67.8 percent, just ninth highest out of 17 developed nations, according to a study from the University of California, Berkeley. Moreover, the study found that American homeowners paid significantly higher mortgage rates, roughly 1.5 percentage points more, than those in Europe. That means that even if homeownership is a worthy policy goal, subsidizing mortgages is not the way to do it.

View original article here: http://www.nytimes.com/2011/02/07/business/07views.html?_r=1

Fannie and Freddie phase-out plan due

This is the first of two articles I'm going to be posting today on Federal "dis-involvement" in the mortgage market. Among the many problems in the mortgage end of the housing market in the bubble years, the repercussions of which we are still facing, was that the government entities Fannie Mae and Freddie Mac were pretty much horribly mismanaged. And you don't have to be a Tea Party supporter to make that statement--that's pretty much a concensus opinion. One of the arguments for reducing government involvement is that the mismanagement costs taxpayers more than the savings they received by having the government backing these entities. In other words, loan costs were kept artificially down by Fannie and Freddie, but that caused the necessity for a bail out, which pretty much cost everyone the same money they had been saving on their mortgages. Naturally, it's impossible to say dollar for dollar what cost more, but as the federal government is going through a budget reduction phase Fannie and Freddie are certainly going to be in the conversation. My own opinion is that it probably will not change the real costs of owning a home, but again no one will really know until some changes are implemented and the system has time to adjust. More opinions on this in my next post, from the New York Times.

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By Ben Rooney, staff reporterFebruary 9, 2011: 8:20 AM ET

NEW YORK (CNNMoney) -- The Obama administration will issue a proposal later this week recommending the gradual elimination of government-sponsored mortgage backers Fannie Mae and Freddie Mac, a White House official said Wednesday.

The highly-anticipated "white paper," which is expected to be released Friday, will include three different options for reducing the role government plays in the mortgage market, the official said.

While the paper would mark an important development in the debate over what to do with Fannie and Freddie, a final decision by Congress is not expected any time soon.

After being rescued by the government in 2008, Fannie and Freddie have presented a major conundrum for policymakers in Washington.

The problem is that phasing out the two publicly traded companies could raise borrowing costs for homeowners and jeopardize the fragile housing market.

At the same time, Fannie and Freddie represent a major liability for taxpayers, who are on the hook for about $150 billion in federal aid the two institutions have received.

The issue has become politically charged, with some Republicans blaming Fannie and Freddie for contributing to the recent housing bubble. Democrats argue that the institutions help promote home ownership, especially among low- and middle-income Americans.

Given the political challenges involved and the threat to the housing market, any winding-down of Fannie and Freddie is likely to take place over a period of years.

A representative for Fannie Mae declined comment. Freddie Mac representatives did not immediately respond to a request for comment.

The three options in the administration's white paper were outlined in published reports Wednesday.

The most conservative of the three options would involve no government role in the mortgage market beyond existing federal agencies, such as the Federal Housing Administration, according to the Wall Street Journal.

The two other options relate to the government's place in the secondary mortgage market, previously filled by Fannie and Freddie. Under one option, the government would backstop mortgages during times of "market stress," while the other recommends that the government be involved at all times.

In addition, officials could also reduce the maximum loan limit for mortgages that Fannie and Freddie are allowed to buy, and encourage them to raise the fees they charge banks to guarantee mortgages.

Other options that could be discussed in the white paper are gradual increases in the minimum down payments on government-backed loans, and an accelerated reduction in Fannie and Freddie's loan portfolios.

View original article: http://money.cnn.com/2011/02/09/news/economy/fannie_freddie_phase_out/index.htm?hpt=T2

Average 30-Year Fixed Mortgage Rises to 4.83 Percent

Published: Thursday, 16 Dec 2010 | 10:46 AM ET
By: AP

Rates on fixed mortgages surged for the fifth straight week, reflecting higher yields on long-term Treasurys.

Freddie Mac said Thursday the average rate on a 30-year fixed mortgage rose to 4.83 percent from 4.61 percent in the previous week. Last month, the rate hit a 40-year low of 4.17 percent.

The average rate on the 15-year loan also increased to 4.17 percent from 3.96 percent. It reached 3.57 percent in November, the lowest level on records dating back to 1991.

Rates are on the rise after falling for seven months.

Investors are shifting money out of Treasurys and into stocks. That's largely on the expectation that the tax-cut plan that Congress is set to approve will spur growth and potentially higher inflation.

Yields tend to rise on fears of higher inflation. Mortgage rates track the yields on the 10-year Treasury note.

The sell-off in the 10-year Treasury note is complicating the Federal Reserve's efforts to lower interest rates by buying up $600 billion in Treasurys. Some traders had hoped the central bank would boost the scale of its purchases to keep interest rates down.

The increase in rates already is chilling the housing market. Refinance activity fell last week for the fifth straight week, while the number of people applying for a mortgage to purchase a home dropped 5 percent from the previous week, the Mortgage Bankers Association said.

To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.

The average rate on a five-year adjustable-rate mortgage rose to 3.77 percent from 3.60 percent. The five-year hit 3.25 percent last month, the lowest rate on records dating back to January 2005.

The average rate on one-year adjustable-rate home loans edged up to 3.35 percent from 3.27 percent.

The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for all mortgages in Freddie Mac's survey was 0.7 point.

View original article: http://www.cnbc.com/id/40699814

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Trouble in Paradise

Trouble in paradise—our plans to build a new house at 102 W 31st may be in jeopardy. Our title search has come back and it’s not looking good. I suppose this would be a good time to discuss the concept of title to a property, which is not unlike title to a car, which most of us have experience with. Think of title as your proof of ownership, which passes from owner to owner when you sell your car or property. Think of buying a new car, in which your title is also brand-new, or even a used car, where you probably only have one or two people before you. But property title can be a little more complicated, especially in a historic district, because of the extended age of the house. Now throw in an issue like we’re experiencing at 102 West 31st, where the current owner bought it at a tax sale, meaning the previous owner had delinquent taxes and the county sold the property to pay those delinquent taxes. Now you see why your mortgage company wants you to create an escrow account with them, so THEY can pay the taxes to make sure they are current. Your property taxes take priority over your mortgage payments in terms of delinquency—in other words, you might be current on your $200,000 mortgage, but if the taxes aren’t paid, the county can take that property, leaving the bank stuck with your $200,000 mortgage, and unlike a foreclosure, without the right to sell the property. It doesn’t happen that often, because usually the mortgage company will pay the taxes and then foreclose upon the house, anyway, because not paying the taxes is a violation of the mortgage, but just know it’s out there. More likely, a property that has no mortgage, especially a piece of vacant land like this, has no bank overseeing tax delinquencies, and eventually, someone gets tired of paying this tax bill and the property changes hands.

The problem we’ve run into is that having the county take the land from you doesn’t mean there were not any title issues before. So let’s say you are in possession of a will that says Aunt Edna is leaving you the house. But Aunt Edna changes her mind and leaves it to Cousin Joe. That ticks you off, so you file a legal suit using the copy of the will as evidence. Now you need a court date and a judgment of some sort, deciding who has the right to the property. And if the judge decides you have the legal right, not Cousin Joe, then Joe may be forced to sell the property or write you a check to settle your interest.

So with all these risks, how do you protect yourself? Well, for starters, most properties don’t have these issues, because you have a title search done as part of your due diligence. You pay someone to go to the courthouse to search the records for anything that’s recorded against the title. Now, all that means is that if someone actually went to the courthouse and legally recorded it, making it of legal record, then there is proof. But if someone has Aunt Edna’s will stuffed under the mattress, and never recorded it, there’s a potential issue. So, if the title is reasonably clean, a title insurance company steps in and says, OK, we will insure this title, and if that will does appear, we’ll defend your interest in the property. If you can purchase title insurance, what’s the issue with 102 West 31st? Well, just like Allstate doesn’t want to insure a driver with 10 accidents, if the title search has brought up a number of issues, the title insurance company may not want to insure. Now, you could still buy the house, going into it with your eyes open, knowing that you’re not protected, and maybe you do. BUT, when you go to sell the property, you have to find another risk-taker willing to buy without the title insurance. Because just because you bought the place, held it for 20 years, and had no problems, it doesn’t mean that will, or some sort of contract written on a napkin, couldn’t rear its head and force you into a legal action to defend your property. And as you know, legal actions are expensive.

And thus, we have a problem. Stay tuned.

Negative Home Equity Is Worse Than You Think

Published: Wednesday, 15 Dec 2010 | 1:12 PM ET
By: Diana Olick
CNBC Real Estate Reporter

There was a lot of talk last week about how negative equity, now at 22.5 percent of all homes with mortgages, according to CoreLogic, will affect the housing recovery. Then mortgage rates popped up to 5 percent overnight, thanks to the 10-year Treasury, and more folks voiced concern over today's potential home buyer and his or her ability to take advantage of this low-priced housing market.

Owing more on your mortgage than your home is currently worth doesn't necessarily mean you can't afford your monthly mortgage payment or that you're going to go about your day any differently, other than feeling a little financially depressed. While it may make some more likely to walk away or "strategically default," most won't.

It does mean that you can't use your home to pay for anything, like a new car or your kids' college tuition, and it does mean that you can't move up to a nicer home without having to take a hit by paying off your mortgage with whatever stash of cash you have. Now here's the issue: The move-up buyer (which is the market we're counting on now to get us out of this mess, given that the home buyer tax credit pulled a lot of first-time buyer demand forward to the beginning of 2010). A significant number of move-up buyers, even if not underwater on their mortgages now, may be in a negative equity position when it comes to buying a new home.

Let me just preface that if you happen to be wealthy independent of your home, or a relative just died and left you a sizeable chunk of cash, this doesn't apply to you. Now here goes. Mortgage expert Mark Hanson makes an excellent point and did some math, which I want to share:

"In order to sell and re-buy, a homeowner must receive enough proceeds from the sale to 1) pay off the mortgage(s), 2) pay a Realtor 5-6 percent and 3) put a 3.5-20 percent down payment on a new vintage loan," begins Hanson, and those alone may be too financially off-putting in today's economy for many potential buyers.

"Effective negative-equity is the big weight on housing that has no easy or quick cure," continues Hanson.

His math:

• Real effective negative-equity as it pertains to house selling and buying starts at:
• less than 9.5% positive equity for FHA repeat buyers (6% Realtor fee + 3.5% down payment)
• less than 16% positive equity for Fannie/Freddie repeat buyers (6% Realtor fee + 10% down payment)
• less than 26% for Jumbo repeat buyers (6% Realtor fee + 20% down payment)

When lowering Corelogic's negative equity threshold to 75% on CA mortgages, 53% are effectively underwater.

And I would add to Hanson's logic, that CoreLogic also noted that an additional 2.4 million borrowers are in a "near-negative equity" position, with less than 5 percent equity in their homes. That puts them out of the move-up market as well.

With rising mortgage rates, even if they don't go much higher, the "effective" negative equity rate of the move-up buyer will impact recovery, slowing sales as more buyers/demand are priced out of the market.

View original article: http://www.cnbc.com/id/40682173

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Buying a home now is a no-brainer

Money Magazine has given their official approval for you to purchase your home. The article below mentions a lot of things I've been discussing the last few months, not that it wasn't common sense to start with. Remember the mantra? If you like the home and the payment makes sense and you're not moving any time soon, this is a great time to buy.

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By Ali Velshi, CNN chief business correspondent
December 13, 2010: 9:26 AM ET

(MONEY Magazine) -- Is now the right time to invest in a house?

Trick question. Actually, it's two questions.

Question No. 1: Is now the time to buy?

Question No. 2: Is buying a house a good investment?

The first answer is easy: With a few exceptions, if you have 20% to put down and good credit, now is a great time to buy. That's been the case all year, and I'd argue that we're probably closer to the end than to the beginning of the really great time. Let me explain.

Back in January home prices had dropped 28% from their peak. More important, interest rates were at historical lows. By locking in a mortgage for 15 or 30 years on a value-priced home, you were getting an incredible deal, even if home prices decreased. (I took my advice and bought a New York City apartment.)

At the time, I thought that prices and rates were more likely to rise than fall. I was half right: Home values have been inching up since the spring, but mortgage rates, incredibly, dropped further.

By August (the latest numbers available) the median home price had risen 1% over a year ago, but 30-year rates had dropped a half-point to 4.5%. Assuming 20% down and a 30-year mortgage, the total cost of owning a median-priced home is now down $16,000 from a year ago.

Home values may waffle over the coming year, but because Americans take out such large, long mortgages, rates are what really matter. And I am more likely to grow hair than see 30-year mortgage rates drop below 4%. It's far more likely that rates (and the cost of ownership) will rise.

Now for question No. 2: Is a house a good investment?

First, it depends on what you mean by investment. If your definition is strictly about dollars returned, a house probably won't be a great use of your capital. If you bought the median-priced house today with 20% down, to recoup your total costs (and I'm not including property taxes and maintenance here) over three decades, the home's value would have to rise about 3% a year.

That's likely, but you'll almost certainly (we all hope) do much better than that in the stock market. The fact is, however, that that's the normal case for housing; the booms that began after World War II and in the late 1990s were the exceptions.

Of course, there are places where you might do better. I bought my condo in Manhattan, a small island that, by virtue of the business done on it, has a sustained demand for property. And smaller, energy-efficient housing in cities or inner suburbs around San Francisco or Chicago is likely to be in higher demand than big, outer suburban homes with long commutes to Las Vegas or Atlanta.

According to urban and environmental planning professor William Lucy of the University of Virginia, this move toward urbanization in American housing is the reversal of a trend that's been in place since 1945. Keep it in mind when making your buying decisions.

That said, the key point to remember is this: Buying a fairly priced home at today's rates may be the best deal you will ever get. And who knows? It may even turn out to be a good investment.

View original article at http://money.cnn.com/2010/12/10/pf/buy_a_home_now.moneymag/index.htm

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

October Housing Starts Down

Housing starts are down. What does this actually mean? The seasonably adjusted number of new construction homes based on permit applications has decreased. Clearly the two new home construction permits my investors and I are applying for next week were not taken into consideration. So a recovery might be on its way. Seriously, though, all the numbers are extremely difficult to use for personal purposes. We're talking about national numbers, and we know that all markets are different, and if there's one thing anyone following this blog should have learned in the past six months, it's that no one really seems to know what's happening. You can sit on the sideline, read your data, wonder where prices are going, wonder where interest rates are going, wonder how many permits were pulled, or you can find a house that makes sense for you now, lock in a historically low interest rate, and stop hiding under the covers. And remember, a rise in interest rates from 4.25% to 5.25% will more than negate any monthly savings you might have in your mortgage payment if you wait for prices to drop 10%. If prices don't drop and interest rates go up, which most observers think they must, you'll be kicking yourself for not locking in at a ridiculously low rate now. And now on to those inscrutable statistics.

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RISMEDIA, November 18, 2010—Nationwide housing starts declined 11.7 percent to a seasonally adjusted annual rate of 519,000 units in October, according to figures released by the U.S. Commerce Department. The decline was primarily registered in the more volatile multifamily sector, where starts retreated 43.5 percent to an 83,000-unit rate, while single-family starts posted a more modest 1.1 percent decline to 436,000 units.

"Home builders continue to be very cautious about starting new projects at this time," said Bob Jones, chairman of the National Association of Home Builders (NAHB) and a home builder from Bloomfield Hills, Mich. "That said, in markets where consumer demand for new homes is reviving, builders are finding it almost impossible to obtain construction financing, and this frustrating situation is producing an unnecessary drag on both new home production and economic growth."

"October single-family starts and permitting activity remained essentially in line with the third quarter's trend," noted NAHB Chief Economist David Crowe. "What this tells us is that the market is running at a steady, but slow, rate following the downturn that took place upon expiration of the home buyer tax credit program and the economic slowdown this summer. Today, builders are just starting to report some improvement in buyer demand, which should gradually translate into more sales activity, and more starts, as the economy strengthens. The great concern is that this positive momentum will be stifled due to builders' inability to obtain financing for new construction at a time when inventories of completed new homes are very thin."

A report to be released by NAHB later today will highlight the extent to which much of the U.S. single-family housing market is underbuilt following the severe decline in production that has taken place since 2006. This finding underscores the concern that demand for new homes could quickly overwhelm supplies as economic conditions improve.

Starts activity was mixed across the nation in October, with gains of 12.9 percent and 1 percent reported in the Northeast and Midwest, respectively, and declines of 13.4 percent and 30.5 percent reported in the South and West, respectively.

Permit issuance, which can be an indicator of future building activity, showed virtually no change in October, with a 0.5 percent gain to a seasonally adjusted annual rate of 550,000 units. This lack of movement was reflected in both the single-family and multifamily sectors, with a 1.0 percent gain recorded in the former and a 0.7 percent decline registered in the latter.

Regionally, permit activity showed no change in the Northeast, a 14.3 percent gain in the Midwest, a 3.4 percent decline in the South, and a 0.9 percent decline in the West.

View original article: http://rismedia.com/lowes/8355/11190

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Foreclosure mess prompts call for stress tests

As everyone knows, I’ve given up making predictions on the near-term future of real estate, and am continuing to make purchases that make sense for my own purposes, as well as advising clients to do the same. My investors and I have three projects in the works—the next two skinny lot Victorian District new construction projects I’ve been discussing, and a small cottage in the Landmark Historic District that we just put under contract and plan to renovate. More on that later. Anyway, we’ve been successful, but maybe news like the following will ultimately make us look like idiots. Or, maybe we’ll continuing being successful while others sit on the sidelines.
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By Ben Rooney, staff reporter
November 16, 2010: 8:20 AM ET

NEW YORK (CNNMoney.com) -- A Congressional watchdog group said Tuesday that U.S. banks should undergo stress tests to determine whether or not they have enough money to absorb losses that could stem from investigations into their foreclosure processes.

The Congressional Oversight Panel, created by Congress in 2008 to review the Treasury Department's response to the financial crisis, issued a 125-page report detailing recent allegations that banks and loan servicers filed thousands of inaccurate documents in foreclosure cases across the country.

While the report acknowledged that the scope and the consequences of controversy remain unknown, the panel warned that the financial system could be at risk if the allegations of "robo-signing" are proven to be true.

"If documentation problems prove to be pervasive and, more importantly, throw into doubt the ownership of not only foreclosed properties but also pooled mortgages, the consequences could be severe," the report said.

The worry is that banks will be forced to buy back mortgages that had been bundled and sold in the $7.6 trillion market for Residential Mortgage Backed Securities, or RMBS. That could result in severe losses for the banks and destabilize the still-fragile financial system, according to the report.

Bank of America has already come under fire from some big institutional investors, including the Pacific Investment Management Company and the Federal Reserve Bank of New York, which have accused the bank of mishandling $47 billion in home loans.

In addition, attorneys general from all 50 states have launched investigations into banks' foreclosure practices.

Still, the report noted that concerns about robo-signing could be overblown, and the panel's chairman told reporters Monday that he doesn't yet know the full impact of the problem.

"It could turn out to be nothing, or it could turn out to be a big deal," said Senator Ted Kaufman, D-Del. "We're not at the stage yet were we have all the info we need to determine how bad it's going to be," he added.

To assess banks' vulnerability, the panel called on regulators to subject banks to stress tests to gauge whether their financial health is sound enough to withstand losses that could result from the controversy under a worst-case scenario.

The Federal Reserve and the Treasury Department conducted stress tests on banks in 2009 amid the financial crisis. But those tests offer "limited reassurance that major banks could survive further shocks in the months and years to come," the report said.

The panel also took issue with statements from the Treasury Department suggesting that the robo-signing problem does not currently pose a threat to the financial system, saying such assertions "appear premature."

In response, a Treasury official said in a statement that the agency is working closely with 11 other federal regulators to investigate the issue, but "they have not found evidence to date of a systemic threat to the broader financial system."

"We strongly believe that the reported behavior within the mortgage servicer industry is simply unacceptable, and servicers who have failed to follow the law must be held accountable," said Treasury spokesman Mark Paustenbach.

The report also raised concerns that the controversy could undermine the Treasury's main foreclosure prevention program, the Home Affordable Modification Program, or HAMP. Panel members are concerned that some servicers dealing with Treasury may have no legal right to initiate foreclosures, which may call into question their ability to grant modifications or to demand payments from homeowners.

However, the Treasury noted that HAMP is intended to help eligible homeowners before they enter the foreclosure process.

View original article: http://money.cnn.com/2010/11/16/real_estate/congressional_oversight_panel_bank_foreclosures/index.htm

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Refinancing Mortgage Might Have its Drawbacks

Good article below about considering your options and alternatives when refinance opportunities come knocking in our current low interest rate environment. Short version is that you can always keep a 30-year mortgage and pay it down quicker, turning it into a 15-year mortgage. The risk of having an actual 15-year-mortgage is getting stuck with higher monthly payments, even if it's a shorter mortgage length, and then not being able to make the higher payments in the future.

RISMEDIA, September 14, 2010--(MCT)--Mark your calendars. The Van Ripers have moved up the date of their mortgage-burning party. When the couple purchased their St. Paul, Minn., home in 2005, they locked in a 6 percent interest rate for 30 years. But with mortgage rates at jaw-dropping lows, they were able to refinance into a 4.125 percent, 15-year mortgage that will save them more than $100,000 in interest and allow them to pay off the mortgage by the time their 3-year-old son is in college. All this for a $100 increase in their monthly mortgage payment.

Shorter-term mortgages are deliciously low. Last week, the average rate for a 15-year fixed-rate mortgage was 3.83 percent with an average 0.6 point (a point equals 1 percent of the loan value), according to Freddie Mac. The rate on a 30-year, fixed-rate mortgage wasn't much higher, weighing in at an average 4.35 percent with an average 0.7 points paid.

Refinancing to a shorter-term mortgage if you can afford the payment seems like an obvious smart-money move. You'll pay far less in interest, get rid of the monthly fixed expense earlier, and have freer cash flow in retirement. Plus there's the high that homeowners feel when they imagine making their last mortgage payment.

"It's just nice to think it's going to be done," said 33-year-old David Van Riper.

But there's a camp out there that believes locking into a shorter-term mortgage is unwise, especially when rates are so low on 30-year mortgages and economic uncertainty so high.

When Kevin McKinley, a Wisconsin financial planner and co-host of Wisconsin Public Radio's "On Your Money," learned I refinanced into a 15-year loan, he e-mailed me a list of reasons why I shouldn't have. His primary concern? That I've locked myself into higher payments at a time when the job market is shaky and home equity is tougher to access. "It's about having the cash right now and being able to do what you wish instead of being at the mercy of the bank, or the real estate market if you have to sell, or your own job," he said.

McKinley would have refinanced into a 30-year loan and stashed any money freed up by the lower payment in a savings account or CD.

I could also have taken the excess and put that money to work in the stock market or even in bonds. Considering my mortgage interest rate after the tax deduction is in the 3 percent territory, it wouldn't be hard to beat that in the market. But that's not a sure thing.

"Given the recent variations in the stock market and whatnot and the low interest rate in savings, it just seemed to make sense to put it into the house," Van Riper said.

Alex Stenback, a mortgage banker with Residential Mortgage Group in Minnetonka, Minn., said this difficult economic stretch has brought out the conservative side in most of us.

"When savings rates go up, when people start talking about 15-year mortgages or paying their mortgages off ahead of schedule, that's really just a form of self-insurance. They're no longer as comfortable with the fact that the sky's the limit and the ladder goes up for them economically," he said.

Anticipating your financial future is hard, but that's exactly what Bill Schwietz, president of the Minnesota Mortgage Association, tries to get clients to do when choosing between loans. He's seen several friends who started with 30-year mortgages, then refinanced to 15-year loans with a big promotion and then refinanced into a 30-year loan again when their children's hockey fees and private school tuition became too much.

Problem is, if you lengthen your loan and roll in closing costs with each refinancing, you'll never pay down the principal.

Kate Wilson, branch manager for Fairway Independent Mortgage in Bloomington, Minn., said 15-year loans can certainly make sense. But she always reminds her clients that there's no law against paying off a 30-year mortgage on a 15-year schedule. You'll still save a boatload, even if your rate on a 30-year mortgage is half a percentage point higher than a 15-year would have been.

Here's the example she calculated: On a $200,000, 30-year mortgage at 4.5 percent, you'll pay $164,813 in interest with a monthly payment of $1,013.37. Pay down that loan in 15 years (by making prepayments of about $517 per month on the mortgage balance) and your monthly payment would be $1,529.98 and you'd pay $75,396 in interest. If you went with a 15-year mortgage at 4 percent instead, you'd pay $66,286 in interest and have a payment of $1,479.37.

So ask yourself if you'd be willing to pay a few thousand dollars more in interest for the flexibility of having an extra $500 a month to cover life's expenses without tapping home equity. Also assess whether you're disciplined enough to actually prepay the loan. If the answer is no, then a shorter-term mortgage is a good fit, provided you can truly afford it.

Most mortgage bankers, including Wilson, have calculators on their websites. The financial calculator site dinkytown.net has several calculators to choose from, including a 15-year vs. 30-year mortgage calculator.

Of course, there's that little problem of declining home values that's making it hard for people who put little money down or bought at the peak to refinance. But having little equity doesn't slam the door. Borrowers with an FHA loan can reduce their rate without an appraisal using the FHA streamline refinance option if they meet the requirements, which include paying the mortgage on time, having income and meeting the minimum credit score requirements set by their lender (generally around 640 these days, Stenback said).

There's also the government's Home Affordable Refinance Program as well as the recently launched short refinance program for non-FHA borrowers who are underwater.

Even if your current circumstances lock you out of a refi, there's nothing stopping you from prepaying a longer-term mortgage. Make an extra payment on your 30-year loan each year and you'll retire it approximately seven years earlier.

"That's a huge pile of money," Wilson said.

By Kara McGuire, (c) 2010, Star Tribune (Minneapolis)
Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Bankruptcy can save your house from foreclosure

By Les Christie, staff writer July 21, 2010: 8:13 AM ET

Original article from CNNmoney.com here

NEW YORK (CNNMoney.com) -- Slick TV commercials and online ads tell delinquent borrowers that they can save their homes by filing for personal bankruptcy. But is it true -- or just too good to be true?

True!

Bankruptcy can bring foreclosure proceedings to a halt, end harassment from debt collectors, and give borrowers time to make up missed payments and reorganize their finances. In some cases, bankruptcy can also help mortgage borrowers save their homes permanently.

It's not, however, going to help every troubled homeowner. If, for example, the homeowner's biggest problem is not enough money, bankruptcy is not going to solve that.

"It's the best tool there is for people behind in payments but who have ongoing income," according to Binghamton, N.Y., attorney Peter Orville, "those who had been making payments and who could be making payments again."

Halting the process

The first thing a bankruptcy filing accomplishes is to stop the foreclosure process. Lenders can't foreclose or even try to collect debt until permitted to do so by the court.

But first, you have to decide what type of bankruptcy to file for. There are, basically, two types to choose from: Chapter 7 and Chapter 13.

A Chapter 7 bankruptcy delays foreclosure. but eventually it usually results in the liquidation of most assets, according to attorney Stephen Elias, author of "The Foreclosure Survival Guide." Borrowers almost always lose their homes in a Chapter 7.

Some bankruptcy attorneys, like New York-based David Pankin, prefer Chapter 7 because it gets rid of all unsecured debt, leaving only secured debt, such as mortgages, exempt. In this scenario, borrowers still owe their mortgage payments but they can likely afford to make them because all the other debts have been discharged.

But for most experts, Chapter 13 is usually more effective at helping people keep their homes. It gives them time to repair their finances, usually three to five years, during which the court agrees to an income-based budget with monthly payments made to trustees.

The trustees pay the bills, first paying off the secured debt. After that, the trustee pays off unsecured debt, starting with back income taxes.

Next in line comes unsecured debt like credit cards and medical bills. By then, there's usually little cash left and these bills are paid at less than the full rate, often as little as five cents on the dollar.

Borrowers, if they kept up on their payments, can emerge from bankruptcy with their homes still in their possessions.

One thing courts cannot do is "cram down" loan balances on primary residences. That is, reduce mortgage debt to what the home is worth. Neither can they lower interest rates, in most cases, nor lengthen the term of the loans.

They can, however, "strip off" second mortgages, like home equity loans or lines of credit, when home values fall below the first mortgage balances, according to Elias.

"This allows the judge to get rid of the second mortgage," he said. "If there's not enough equity to secure the second, it becomes unsecured debt."

That can be a huge advantage for borrowers. Homeowners may have, for example, a $200,000 first mortgage balance and another $50,000 on a home equity loan. If the home value has dropped to less than $200,000, the judge could rule that all $50,000 of the second is unsecured. Then, it can be paid off at the same pennies-on-the dollar as other unsecured debt.

But there are other downsides. Bankruptcy can lop as much as 240 points off credit scores. And bankruptcies can remain on credit reports for 10 years, said Pamela Simmons, a California real estate attorney, while all other black marks disappear after seven years or less.

Fending off deficiencies

There is also a potential tax advantage to filing for bankruptcy rather than going to foreclosure, according to Simmons. When a home is repossessed and the lender forgives the portion of the mortgage balance above its market value, a tax liability can be triggered. Any difference between what people borrow and what they repay is considered income.

Congress is temporarily allowing that unpaid debt to be forgiven -- but only for money specifically spent on the home purchase or on home improvement.

Foreclosed? Here comes the tax man

Millions of people, however, refinanced mortgages or took out home equity loans and used the money to fund vacations, pay college tuition, buy cars or boats or simply to live the good life. That money is taxable.

Simmons had a recent client who was allowing his lender to foreclose on him and called her about the timing, asking whether he had to vacate by the day of the auction.

In passing, she asked him how much he owed on the house. He said he bought it for a million but had taken out another $2 million, most of which had not been spent on the house. When she told him he would owe taxes on it both to Uncle Sam and the State of California, he was dismayed

She rushed him into her office and they did the paperwork so he could file for bankruptcy.

"If they discharge that deficiency in bankruptcy, you don't owe tax on it," said Simmons.

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

New Changes to FHA loans

This is big news on any level--a great percentage of the loans our buyers are currently using are FHA loans. This reduces the seller's maximum contributions from 6% to 3%, which should go into effect around August 15th.

Click here for the official release.

The highlights are as follows:

For the next 30 days, HUD is seeking public comment on the following policy changes, each of which are designed to mitigate risk to the Mutual Mortgage Insurance Fund while promoting sustainable homeownership for FHA borrowers:

1. Update the combination of credit and down payment requirements for new borrowers. New borrowers seeking FHA-insured financing will be required to have a minimum FICO score of 580 to qualify for FHA’s flagship 3.5 percent down payment program. New borrowers with credit scores of less than a 580 will be required to make a cash investment of at least 10 percent. Borrowers with credit scores of less than 500 will no longer qualify for an FHA-insured mortgage.

2. Reduce allowable seller concessions from six to three percent. Allowing sellers to contribute up to six percent of the home’s sales price to offset a buyer’s costs exposes the FHA to excess risk by potentially driving up the cost of the home beyond its appraised value. Reducing seller concessions to three percent will bring FHA into conformity with industry standards.

3. Tighten underwriting standards for manually underwritten loans. When using compensating factors in the underwriting process, lenders will be required to consider those factors which are the best predictive indicators of loan performance, such as the borrower’s credit history, loan-to-value (LTV) percentage, debt-to income ratio, and cash reserves.

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Nothing like waiting for the last minute

Think about this for a moment, and then think how idiotic it is. Everyone--buyers, sellers, agents, attorneys and especially lenders--to get deals closed before June 30th, so buyers can take advantage of the first-time buyer $8000 tax credit. Because of the overload, Congress has been considering extending the closing date deadline. So when do they finally vote and approve the extension? Yesterday, a day before everyone needs to close. Your elected representatives, ladies and gentlemen.

The House of Representatives voted on Tuesday to extend by three months the closing deadline for the home buyer tax credit, setting the stage for a possible last-minute reprieve with Wednesday’s deadline looming.

The extension of the tax credit worth up to $8,000 isn’t a “sure thing” yet. The Senate still needs to pass the House measure, and President Obama would have to sign it into law.

The Senate had approved a similar provision earlier this month, but it was included in a larger tax package that failed to secure enough votes when it was considered last week. On Tuesday, Senate Majority Leader Harry Reid (D., Nev.) said he would again try to bring the extension up for a vote, along with other measures, including retroactively reinstating federal unemployment insurance benefits.

In recent weeks, lenders and real-estate companies have warned of bottlenecks that could lead thousands of potential buyers to miss out on the credit that they thought they were getting.

Congress first created a tax credit for homeowners in 2008. It was extended and expanded twice during 2009. The most recent extension said that house purchase contracts would have to be signed by April 30, and home buyers would have until June 30 to close on those sales. The House proposal would give buyers who met April’s contract deadline until Sept. 30 to finalize those purchases. The credit wouldn’t be available to buyers who weren’t under contract before April 30, though the change has raised concerns that some tax-cheats might submit bogus claims.

View original article here: http://blogs.wsj.com/developments/2010/06/29/will-congress-extend-the-tax-credit-closing-deadline/

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

US Home-Buying Loan Demand Falls for 4th Week

Short version of the article--low rates, lower sales, good for buyers. Not great for sellers, but on the other hand, IF YOU HAVE A WELL-PRICED HOME, there are great loans for buyers right now. And the buyers are indeed looking...

Demand for loans to buy U.S. homes fell last week for the fourth straight week, holding 13-year lows, as the housing market adjusted to a selling environment without the federal tax credits that had stoked April sales, the Mortgage Bankers Association said on Wednesday.

Home buying ran out of steam after eligible borrowers sprinted to meet the April 30 deadline for up to $8,000 in tax credits. The incentive pulled house sales forward and triggered the largest monthly construction spending gain in nearly a decade.

Total loan applications eked out a 0.9 percent rise in the week ended May 28, seasonally adjusted, as a 2.4 percent in refinancing demand offset a decline of 4.1 percent in purchase loan requests to the lowest level since April 1997.

"Purchase applications are now almost 40 percent below their level four weeks ago, while the refinance share, at 74 percent, is at its highest level since December," Michael Fratantoni, MBA's vice president of research and economics, said in a statement.

Average 30-year mortgage rates rose 0.03 percentage point to 4.83 percent last week, but the low rate drove more homeowners to apply for refinancing.

The rate rose as high as 5.31 percent in early April before euro zone market troubles triggered a flight to safety in U.S. Treasurys, driving down their yields, which are used as a peg for mortgage rates.

A so-called "hangover" from more than a year of the tax credits had been widely expected, and most economists expect U.S. housing can stand on its own footing as the year progresses.

"This volatility in activity is the price paid for higher average levels of sales across the year as a whole than would have occurred without the tax credit," Ian Shepherdson, chief U.S. economist at High Frequency Economics, wrote on Tuesday.

Buying a home, for qualified purchasers, remains affordable with mortgage rates historically low and prices down about 30 percent on average from their peaks in 2006.

But at least in the weeks since the tax credits expired, homeowners are concentrating on shaving costs by refinancing.

The MBA's refinance applications index has risen for four straight weeks to its highest level since October 2009.

Still, refinancing is also experiencing "burnout," with fewer people acting to refinance each time mortgage rates fall near current levels, Fratantoni said in an interview.

The refi index, at roughly 3,300 last week, is well below the most recent peak of about 7,400 in early January 2009 when 30-year mortgage rates were roughly similar. In 2003, when the loan rate was just under 5 percent, the refinance index shot up to about triple last week's level.

"A lot of people would benefit from getting a lower rate but they don't have equity, they don't have income, they don't have credit," Fratantoni said. "You're getting a response, but it's a fairly muted response."

From Reuters on CNBC. View the original article here.

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.

Mortgage Rates at All Time Lows

It's interesting that you don't really hear this, but mortgage interest rates are at all time lows right now. Let me repeat that--all time lows. You would think that would be a big story. Right now, my mortgage partner, Michael Caputo from Bank of America, is quoting 4.75% 30-year fixed mortgages and 4.5% 30-year fixed mortgages for FHA loans. FHA requires on 3.5% down, so think about that for a moment: 3.5% down, 30-year fixed loan, all time low interest rate. That should be attractive to most people. And by the way, you can do a 5-year loan at 3.5%. Rates are just absurdly low.

The full article is at Bankrate.com. Click here.

Blogger Matthew Allan is a specialist in Savannah Real Estate, focusing on Savannah's downtown historic districts, including the Landmark Historic District, Victorian Historic District, Thomas Square Historic District, Starland Historic District, Baldwin Park, and Ardsley Park Historic District.