Craig Smyser
Displaying blog entries 1-10 of 160
The mortgage tax passed and signed into law in late December 2011 is still largely unknown by the public. As we get close to implementation, I asked John McClellon with Supreme Lending to explain how the new tax will impact the cost of a mortgage. The mortgage industry is commonly referring to this new tax as the G-Fee.
The Wall Street Journal reports that MetLife recently closed its profitable mortgage division, firing 4,300 workers, because it was not willing to continue in the industry because of the "regulatory environment." That's a nice way of saying the government is so intrusive into the business that it isn't worth it for us to keep the doors open. MetLife got into the mortgage business in 2008 when the industry was at the bottom because it was able to get in there cheap. However, in October, the Fed informed MetLife they would have to be subjected to stress tests which would hold up their ability to distribute $4.8 billion to shareholders. Since the profitable mortgage business was so small they decided it wasn't worth the consequences it had on their insurance business. They tried to sell it, but only Wells Fargo and Bank of America could afford it because it is so large. However, these two banks don't need more mortgage exposure. So instead of selling it, they just closed it and let go 4,300 employees. For those of you with a Wall Street Journal subscription, you can access the whole article.
Personally, being in the real estate industry for over 12 years, I will be happy when the government stops messing around with housing and backs off of many of these new regulations which are making things worse. And I'm not aiming this at just one political party. The new mortgage tax that passed the Congress with huge support on both sides of the aisle will soon be responsible for a spike in rates of between 1/2 and 3/4 of a point. Though the tax is just 1/10 of a point, the consumers will see a much larger bump. For some more on the mortgage tax, view a previous blog entry. I will have more on why rates are going up so much as a result of this tax in the near future.
As always, feel free to contact me regarding any real estate issues via email, online form, or at 512-735-7200. To comment on this topic, you can also use the comment fields below.
Coming to the market by early February, this 4 bedroom, 2 1/2 bath home is located in the Legend Oaks in Austin. It is a foreclosure situated on a cul-de-sac. To request a showing before the house hits the market, contact me via email, online form, or at 512-735-7200.
I missed this article when it ran about two months ago, so you may have seen it already. If not, you may be a bit envious of these college students who are living in luxury homes for less than the cost of a dorm room. Of course, they'll be the envious ones when they graduate and can't find a job, right?
On January 1, 2012, a host of new laws went into effect in Texas. In this video, I summarize a few related to the ability of an HOA to foreclose.
In this year-end edition of How's the Market in Steiner Ranch?, I review the year end sales figures, give my interpretation of them, and provide my predictions for 2012.
Here are the additional stats and graphs referenced in the video: Resale and All MLS. As the name implies, the Resale link is for resale properties only. The All MLS link is for all Steiner Ranch properties listed in the MLS. This includes some new construction homes, but certainly not all new construction homes sold in Steiner. As a result, it is not a full, accurate picture of the market.
To view summary and detailed information for all Steiner Ranch neighborhoods, check out the Neighborhood Home Sale Data. If you are looking to buy or sell a home in Steiner Ranch, contact me via email, online form, or at 512-735-7200.
If you prefer to read instead of watch, here the transcript:
In 2011, 223 existing homes closed in Steiner Ranch which was down 10.4% from 2010. Because the builders do not list all of their homes in the MLS, it is harder to present the new construction figures. I contacted the developer, Taylor Morrison, and was informed that the most recent data they have is through August at which point 112 new homes had been sold in Steiner. Using projections, that will likely end up around 170 new homes sold in 2011, which would be down about 8%. Overall sales, based upon that projection, would have 393 Steiner Ranch homes closed in 2011, down 9.4%.
For the remainder of this review, the stats discussed will be for resale homes only. In 2011, 8% of the sales were distressed with 12 sales being foreclosures and 6 being short sales. The average sales price for resale homes in Steiner Ranch in 2011 was $401,811 down 1.5% from the prior year. The median sales price was unchanged at $345,000. The average price per square foot was $125.54 up 3.6%. All of these clearly indicate a stable market. The sales prices in 2011 ranged from $200,000 to $1,549,000. The average sales price to list price ratio was 96.8% and the average sales price to original list price ratio was 94.6%. For resale homes that closed in 2011, the average length of time it took to get a contract was 56 days. More stats and graphs are available here: Resale and All MLS.
So what do I expect in Steiner Ranch for existing home sales in 2012? My prediction is a slight improvement over last year. I believe we’ll see a 5% to 10% increase in the number of resale homes sold as well as a small increase in the average price, median price, and average price per square foot. I expect mortgage interest rates to remain at or near historic lows. The Austin job market remains stable so we should continue to have a steady stream of buyers, which will, of course, include families relocating to Austin and interested in the Steiner lifestyle. As the developer begins to wind down home sales, the number of new construction homes being built will slow while commercial activity will continue for several years to come. In short, I expect an improvement in the Steiner Ranch resale housing market for 2012. As always, if you have any questions, please don’t hesitate to call me at 512-735-7200 or email me at Craig@RealEstateInAustin.com.
In this edition of How's the Market in Steiner Ranch?, I review a few of the monthly sales stats, give my interpretation of them, and discuss the new tax on mortgages.
To view summary and detailed information for all Steiner Ranch neighborhoods, check out the Neighborhood Home Sale Data. If you are looking to buy or sell a home in Steiner Ranch, contact me via email, online form, or at 512-735-7200.
If you prefer to read instead of watch, here the transcript:
In December, 24 homes closed in Steiner Ranch which was down 4% from December 2010. Of the 24, 17 were resale and 7 were new construction homes. Of last year’s 25 sales, 20 were resale and 5 were new construction. So if you look only at existing home sales, this past December was down 15%. Keep in mind that many new construction homes are not listed in the MLS so I cannot provide accurate data on new construction numbers in Steiner Ranch.
When we are looking at small sets of data such as one month in Steiner Ranch, I don’t like to compares prices from one year to the next because they can be very volatile. For the record, the average price increased 3% and the median price decreased 5% over last December. These numbers continue to show a relatively stable market in Steiner Ranch. Last month, the sale prices in Steiner ranged from $245,000 to $680,000.
The number of available homes in December was 88, the exact same number as the previous December. By available homes, I mean homes that are actively for sale – it does not include homes under contract. This is a snapshot in time and actually varies throughout the month. I expect the number of available home to drop for another month or two, before turning up again. For homes that closed in December, the days on market was 72 days. As always, my website allows you to look at summary and detailed data for each Steiner Ranch neighborhood (click here).
Now let’s take a look at the new tax on mortgages signed into law last month. In order to pay for a two-month extension of unemployment benefits and payroll tax reductions, a permanent tax will be imposed on new mortgages starting on April 1, 2012. This tax is 1 tenth of 1 percent of the loan amount so it will increase the monthly payment for the entirety of the loan. It applies to mortgages backed by FHA, Fannie Mae, and Freddie Mac, which currently account for approximately 90% of all new home loans. If a new mortgage is one of the 10% guaranteed by a private mortgage insurer, it will not be affected. Again, this is for new mortgages only and does not affect mortgages already in place. The tax is slated to be on all FHA mortgages originated for the next 10 years but is a permanent tax for Fannie and Freddie mortgages. I first tweeted about this on December 17, so if you want to know what’s going on that affects real estate in Steiner Ranch, follow me at http://Twitter.com/SteinerHomeInfo. As always, if you have any questions, please don’t hesitate to call me at 512-735-7200 or email me at Craig@RealEstateInAustin.com.
Little publicity has been given to a new tax on mortgages that was signed into law on December 23, 2011, as a result of the negotiations to extend unemployment benefits and payroll tax reductions. In this video, I discuss what this tax means for new mortgages.
If you have any questions about this new tax or other real estate issues, contact me via email, online form, or at 512-735-7200.
For those of you who prefer to read instead of watch, here is the general transcript of the video:
On December 23, 2011, the president signed into law a new tax on mortgages. In order to pay for a two-month extension of unemployment benefits and payroll tax reductions, a permanent tax will be imposed on new mortgages starting on April 1, 2012. This tax is 1 tenth of 1 percent of the loan amount so it will increase the monthly payment for the entirety of the loan. It applies to mortgages backed by FHA, Fannie Mae, and Freddie Mac, which currently account for approximately 90% of all new home loans. If a new loan is one of the 10% guaranteed by a private mortgage insurer, it would not be affected. Again, this is for new mortgages only and does not affect mortgages already in place. The tax is slated to be on all FHA mortgages originated for a 10-year period but is permanent for Fannie and Freddie.
I first tweeted about this as soon as the Senate passed this bill on December 17, so if you want to know what’s going on that affects real estate in Austin, follow me at http://Twitter.com/AustinHomeInfo.
The National Association of Realtors (NAR) is downwardly revising home sale numbers dating back to January 2007. As it turns out, they were double counting some houses. So the housing market was actually worse than was previously thought. I am a member of NAR and, frankly, have a love/hate relationship with them (don't worry, I'm not going to write anything further about that).
So how was NAR double counting? Let me step back a bit to give you the overview of how the numbers are compiled. Most multiple listing services (MLS) are owned by the local branch of the Realtor association. Any property listed by a member of the Realtor association must be entered into the MLS so it is a good representation of the overall housing market. Each month, the local Realtor Association sends the data to NAR which compiles the national stats. However, the data that comes out is only as good as the data that goes in. As a Realtor, I can tell you that there is a lot of garbage in there. Further, in addition to resale homes, new construction houses are also counted in the MLS. Because only some new construction homes are listed in the MLS, this gives incomplete data. Personally, I believe the Austin Board of Realtors should primarily report on existing home sales, then mention as a footnote the new construction leaving the accurate new home data to come from the builder's association. To give an example, according to the Austin/Central Texas Realty Information Service (our MLS), there were 19711 total sales in 2010. When you exclude new construction sales, the total was 17663 - a drop of more than 10%. Clearly, even if this was the only thing wrong with the data, there has been a big overstatement on the national scale. In fact, according to an article on the CNBC website, a real estate statistics company believes that NAR may have overstated sales by as much as 20%. It will be interesting to see exactly what the restatement is when released next week.
On a related note for those who care, the sales numbers released each month by the Austin Board of Realtors are not taken straight out of the MLS. In fact, the MLS records are sent to the Real Estate Center at Texas A&M. They run the data through some formulas to provide an estimate of the actual sales figures (they correctly presume that some Realtors fail to report sales in a timely manner). These figures are then sent back to ABOR and released to Realtors, the media, and the public (I investigated this a while back because the numbers reported each month never matched what I compiled by looking at the MLS). The Real Estate Center then updates the sales figures about six months later by looking at the actual MLS data (although the 2010 sales numbers in the MLS are different than the total from the Real Estate Center so who knows).
While the housing stats compiled by NAR are a good representation of the housing market, don't take them as absolute. Remember that NAR is a trade organization and one of the main objectives is to promote the buying and selling of houses.
Displaying blog entries 1-10 of 160
