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June 20, 2008

FHA Loans: A hot subject (guest post)


(This is a guest post by Aaron Dehart, mortgage planner at Morgan Financial. 
You can send him an email for additional questions regarding FHA: Aaron.DeHart@wjbradley.com)

FHA Pricing has been a hot subject as of late.

Although interest rates are still great when it comes to Government Loans, the volatility of the Market Place and the recovery of the Sub prime mess are still rearing its ugly head. As a result, every lender has gone to a risked base pricing system when it comes to Government loans.

Now this does not mean that FHA/ HUD have gone to this but it is the individual banks that are protecting their own interests. For example many banks are requiring a minimum Credit Score of 580 now for them to insure the FHA Loan; others are even higher with a 600 FICO score requirement.

Now this does not mean that someone can not still qualify for an FHA Loan because FHA uses what is called a total score card. Meaning they look at the big picture, this not only includes the credit score, but also takes into consideration time on current, credit history for the past two years, debt to income ratio, loan to value, amount of reserves, etc.

What does all this mean? Obviously the stronger the candidate, good credit, good job history, lower debt to income ratio, good reserves in the bank, will be rewarded with an excellent interest rate.

For example if you have a credit score of say 700, 3 months of reserves and good job history, then you are rewarded with an interest rate of between 6 and 6.25% depending on market conditions when you lock of course. If your score is below 600 and depending on if you get an automated approval, (Automated Underwriting) we will discuss what that is later. Then the banks are going to charge you the selling premium, very simple the higher a risk the more banks have to pay to sell your loan on the secondary market.

The money has to come from somewhere so the banks are going to charge that upfront in pricing to ensure they have a loan that can be sold. Also it is important to point out that if a couple is married, the spouse’s debts must be used in qualifying. The lower mid credit scores of the two borrowers is being used. Example Husband 680, wife is a 575, the 575 score would be used for pricing. It is possible to remove the lower fico if the individual borrower can qualify on their own, however, the debts of the spouse will still be used in qualifying.

So you can see that FHA can fluctuate from having a right at market rate to having a higher than market rate determined by the overall scoring factor that FHA has. FHA are still the best loans to get for someone who has below a 680 FICO score, limited reserves and little or no money down for the transaction, especially if the property is located in a declining market area. The pricing adjusters are far more extreme on Conventional loans if you do not fit into those categories.



June 19, 2008

Sparks Real Estate: Supply (Updated: June 19 '08)

Blog.sparksTeardropPIC  "Two teardrop trailers arrive in Sparks,NV" Photo by: Big woody teardrop trailer


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                          "I want you to win in the Sparks real estate market"

                                                                  ----------------------------------

About:  

We'll review the number of homes for sale in Sparks for the period of November 2005 - May 2008.

WIIFM (what's in it for me?): 

I want you to win in the Sparks real estate market.  And the best way I know how to make this happen is to help you better understand the Sparks real estate market through concrete statistics and figures.  We'll keep it simple, I promise.

Highlights:


  • Although sellers are starting to come out, the numbers are just average to lower compared to 2006-2007 figures (see graph). 

Graph:

Blog.SparksRealEstateSupplyMay2008

Click Here For Full Page View


Raw Numbers:

May '08: 1,068

Apr '08: 1004

Mar '08: 922

Feb '08: 881

Jan '08: 886

Dec '07: 877

Nov '07: 985

Oct '07: 1,056

Sep '07: 1,120

Aug '07: 1,232

Jul '07: 1,242

Jun '07: 1,229

May '07: 1,204

Apr '07: 1,144

Mar '07: 1,095

Feb '07: 1,030

Jan '07: 1,093

Dec '06: 1,051

Nov '06: 1,195

Oct '06: 1,311

Sep '06: 1,443

Aug '06: 1,566

Jul '06: 1,617

Jun '06: 1,583

May '06: 1,548

Apr '06: 1,328

Mar '06: 1,196

Feb '06: 1,128

Jan '06: 1,083

Dec '05: 1,106

Nov '05: 1,195

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              Call Joe (775-338-7653) to see the best homes at the best price 
                                          in Sparks today!

                                                     
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* Sparks Residential homes site/stick built

Updated: June 19,2008

Source: Multiple listing Service via Broker Metrix

Next Release Time: July 14,2008 (Every 14'th of the month)

June 18, 2008

Reno,Sparks & Carson Real Estate Market Analysis (Updated June 17,2008)

Reno_mayor_2 Sparks_mayorgeno_martini_3   Carson_mayormarv_teixeira_2  The Mayors of Reno (Bob Cashell), Sparks (Geno Martini) & Carson (Marv Teixeira)  

About: A few questions came into mind  two days ago while I was browsing through some real estate stats at the office:  ' how is the real estate market of Reno,Sparks & Carson City compare to each other?'

And 'who is holding up best amongst the three major cities of Northern Nevada?'

Thank God for technology, it is not as hard as it used to to chase after these questions.  And chase I did. It was enlightening. 

We will compare the LTM vs PTM:

LTM- last twelve months
PTM- previous twelve months


WIIFM (what's in it for me?)

If you are like me I get confused by the countless opinions,facts and real estate tidbits out there.  I used to think that the Sparks Real Estate Market was experiencing a deeper correction than Reno.  Then I switched (with some data backing this belief).  Sparks real estate was in a better shape.  'Oh I don't know anymore.' 

But this new data I uncovered delivers hope.  Compared to my past attempts to differentiate the Reno,Carson and Sparks real estate markets this is by far more authoritative.  It is true what they say, 'we learn as we go'.


Highlight(s): 

  • Carson real estate is experiencing the deepest correction based on volume(see: 1st graph)
  • Reno is holding up best based on Median Price appreciation.(see: 3rd graph)

Graph(s):

Percent Growth- $ Volume

Blog.Reno,Sparks,CarsonVolumeMAY2008


Click Here For Full Page View


Percent Growth- # Units

Blog.reno,sparks,CarsonUNITSMAY2008


Click Here For Full Page View


Reno,Sparks & Carson Median Prices. (what is median price?)

Blog.reno,sparks,carsonMedianpriceMAY2008

 
Click Here For Full Page View




Community Links:


Number of updates: 4'th
Updated: June 17,2008
Source: Multiple listing Service

Next Release Time:  July 17,2008(every 17th of the month)
*Residential homes site/stick built

June 16, 2008

Caughlin Ranch Real Estate Market Report (updated June 16,2008)

Blog.caughlinranch PhotoPhoto By: Caughlin Ranch Homeowners Association

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               "My goal is to give you an advantage over your competition by showing you what the market is doing."

                                            --------------------------------------------

WIIFM(What's in it for me?):

I want to show you what's happening in the Caughlin Ranch Real Estate Market.  If you're a buyer or seller in this area my goal is to give you an advantage over your competition by showing you what the market is doing. 

This data comprises the areas of Reno-Old Southwest (MLS area: 160)  Reno-West-Southwest (MLS area:161)

Time period: December 2005-May 2008

Highlights:

  • (May 2008) Supply is still in a downward trend but ever since February of this year sellers have been going out in droves.( see: 1st graph)
  • (May 2008) Demand,similar to supply is still in a downward trend.  Buyers seems to be waiting for the prices to stabilize before they get in the market.(see: 2nd graph)
  • (May 2008) Median prices of homes are still down.  March 2008 could be the market bottom for median home prices for Caughlin Ranch. Prices have been steadily going up since start of this year's summer (see: 3rd graph).

Graphs:

Blog.CaughlinRanchSupplyMay2008 Click here for full-page view



Blog.CaughlinRanchSOLDmay2008 Click here for full-page view


Blog.CaughlinRanchMedianPriceMAY2008 Click here for full-page view

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             Call Joe (775-338-7653) to see the best homes at the best price in Caughlin Ranch today!

                                                   ------------------------------------

Community Links:




Number of updates: 6'th
Updated: June 16,2008
Source:Multiple Listing Service via Broker Metrics
Next Release Time: July 16,2008

June 13, 2008

Sparks Real Estate: Demand (updated June 13, 2008)

Blogsparks_sold_pic_mar_21_2    Updated June 13,2008
'I see Sparks in Sparks Real Estate'

About:  Number of homes sold in Sparks for the period of Nov 2005- May 2008.  If the Number of Homes For Sale show us the supply of homes in the Sparks real estate market, in this post we will be looking at the market's demand side.

WIIFM (what's in it for me?)Our hope is that by showing you the supply and the demand of the Sparks real estate market you can have a bird's eye view of what's really going on in our real estate market.   

We have always carried with us the belief that the market's opinion is far superior than any of us so called 'experts'.  Hope this helps you in your decision-making.

Highlights:

  • (May 2008) Demand in Sparks went up significantly(40 homes!) since summer started. 

Read past Highlights

 

 

Observation/comments:

  • (June 2008) Demand has gone above last year's summer high(seen in the graph below).  Prices have come down to the point where it is attractive for buyers.
  • (May 2008) For the past six months, by and large, demand in the Sparks real estate has steadily gone up.  I just found out about this one hour ago.  This is vital information for both sellers and buyers and I plan on looking deeper into this.  This could be the bottom for  demand though prices are still going down, once demand bottoms out its just a matter if time when prices also reach the end of the trough.

Read past comments

Graph:

Blog.SParksSOLDPicMay2008
Click Here For Full Page view


  • May '08:  98
  • Apr '08:  103
  • Mar '08:  63
  • Feb '08:  53
    · 
  • Jan '08:  51
  • · Dec '07:  57
  • · Nov '07:  57
  • · Oct '07:  71
  • · Sep '07:  76
  • · Aug '07:  89
  • · Jul '07:   94
  • · Jun '07:  87
  • · May '07:  92
  • · Apr '07:   92
  • · Mar '07:  94
  • · Feb '07:  66
  • · Jan '07:  65
  • · Dec '06:  75
  • · Nov '06:  79
  • · Oct '06:   108
  • · Sep '06:  114
  • · Aug '06:  114
  • · Jul '06:     98
  • · Jun '06:   114
  • · May '06:  96
  • · Apr '06:   104
  • · Mar '06:   110
  • · Feb '06:  93
  • · Jan '06:  77
  •     Dec '05:  94
  •     Nov '05:  100

 

*  Sparks Residential homes site/stick built

Updated: June 13,2008
Source: Multiple listing Service

Next Release Time: July 19,2008  (Every 19'th of the month)

June 12, 2008

Superb home in Reno-South Meadows (Double Diamond Pkwy): $279,000

Once in a while I would disobey my rule ('thou shall not explicitly advertise our listings in the blog').  I only do this when I know deep in my gut that a listing is 'the' leader of the pack.

I don't think this home will last a month.  It is the best priced home in the neighborhood and perhaps best condition too.  Pride of ownership overflows all through out the home. The owners did a marvelous job in keeping the home in tip-top shape.


Reno real estate


IMG_1730


IMG_1732


IMG_1736


IMG_1738


IMG_1740(second bathroom)


IMG_1741

IMG_1742


IMG_1743


IMG_1749


Details:

  • Home is subject to short sale
  • Built: 2005
  • Total Living Space: 2,068 Sq. Ft.
  • Price per SQ. Ft : $134.91
  • Bedrooms: 4
  • Baths: 2 full baths
  • Total parking capacity: 3
  • Acreage: .16
  • Stories: 1 story
  • Plantation shutters on all windows
  • High ceilings
  • Gas fireplace
  • Upgraded kitchen: Tile counter tops and stainless kitchen
  • Double sink in both bathrooms
  • Walk-in closet in Master's bedroom


                      Call Joe to get more information: 775-338-7653


June 11, 2008

For Buyers in Sparks: Best Performing Areas

What's been happening in the different market areas in Sparks?
What area in Sparks has been most affected by the market downturn?
What area is holding up best?

Like what I said in my last post(buyers in Reno), there is no one winner-take-all.  But this can help you determine which part of Sparks is holding up best.  Knowing this information is vital, for it will give you a glimpse of what the future has in store for you in your desired area. 


Guys, take your time, analyze the specific areas you want.  But don't succumb to analysis paralysis.  Listen to the story the market is telling you, digest it, then one way or another you have to decide what you want to do based on your objectives not anybody else's. 


If you need more data, some advice or something is not clear to you do not hesitate to call me (Joe:775-338-7653) or Ian  (775-338-7649) for a no-hassle-no-pressure phone meeting.

And here are the winners ladies and gentlemen:

1. Percent growth # of units : Spanish Springs South


Percent growth- # units
Blog.180sparksUnits





2. Percent growth- $ Volume:  Spanish Springs South

Blog.180sparksVOLUME




3. Percent Growth- Median price:  Spanish Springs- West

Blog.180sparksMEdian

June 09, 2008

For Buyers: The Hottest Area Codes in Reno

I started my Monday with this question in mind: 

What is the leading area in Reno? And I need solid evidence to back it up. 

Answer:  It depends

Here are the winners.

For Median Sales Price:  Caughlin Ranch  (Reno-West Southwest, MLS area code 161)

(graph shown)
Blog.161.RenoS.WestJune2008

Click here for full-page view



For Percent Growth-$ Volume: Verdi (MLS area code 124)

(graph shown)
Blog.124%Volume

Click here for full-page view



For Percent Growth- Units: Verdi (MLS area code 124)

(graph shown)
Blog.124uNITS

Click here for full-page view

*note: It is important to know that Verdi is not a large pool (1-3 closings/month, 20-30 homes for sale on average)

Buyers, these areas could be a good starting point for your home searching.  I just checked some listings at or near Caughlin Ranch(area 161):

Prices range from $280,000 to $3,595,000

1. 200 Brooktrail Dr.1,498 Sq. Ft., $280,000

2.  1263 Creek Haven Cir. 1,588 Sq. Ft., $299,900

3. 4805 Turning Leaf,2,465 Sq. Ft., $499,000


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       Interested in learning more about the other areas in the Reno market?
     Call Joe for a No Hassle-No Pressure-Phone meeting 775-338-7653


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June 04, 2008

How I learned to see the Reno market through the eyes of Bear Grylls


Blog.creme bruleeImage by: Discovery.mae

T
hese past three years in our market has not been unlike Bear Gryll's three-day ordeal at the African Savanna.

Bear Grylls is the 'host' of Man Vs. Wild. He is an ex-British Army Special Air Service who is lurched (usually from a helicopter) in the middle of nowhere to survive unforgiving temperatures with nothing more than a knife and if he's lucky, a flint.

Not unlike the story of our real estate market the past three years -the best times of my real estate career.  As JoAnne Correira beautifully painted it to me two years ago, "this market will separate the men from the boys".

But like in any hard times there will always be the Crème brûlée dessert after enduring Aunt Bernice's burnt ribs.  With some graphs and statistics straight from MLS (see below) and our group poised to have one of our best sales years ever. The market could be heading for a possible bottom in demand this year and prices not long after that.


Here are some of the evidences:


Homes under contract in Reno in the last six months (weekly)
Blog.renoUnderContractMay262008(click here for full-page view)





Homes Under Contract and SOLD in Reno in the last six months(weekly)
Blog.RenoSOLD,UCJune2008 (click here for full-page view)


Median price of homes in Reno in the last six months (weekly)
Blog.RenoSOLDMedianPriceJune2008(click here for full-page view)




If I only let the burning life in me eager only to see the 'bright lights' without considering the other side would be disservice to you.

I owe it to you my dear reader to also show you the possible chink in the furniture:

1.  Seasonal increase.

Solution: This coming winter will be the ultimate judge as to whether it will stay above Jan 21,2008 possible demand bottom.

Blog.RenoUnitsSOLdJAN21May262008 (click image for full-page view)


I leave with you the words of David Ogilvy:

"I notice increasing reluctance on the part of marketing executives to use judgement; they are coming to rely too much on research, and they use it as a drunkard uses a lamppost for support, rather than for illumination."

Use it for illumination dear friends.  And you'll go far.

May 28, 2008

Layout fixed! thank-you for your patience

Pardon me for the delays in the market reports.  The past two days have been spent trying to fix the layout problems(for those using Internet explorer browser).

 

Thank-you for your patience.