The Bains

Tyler area home sales were down 3.9% in May, compred to the same time last year.  The median home price ws down to $137,000 in May 2011 or 4.2 %  less than a year ago.  Home inventory in the Tyler area is 14.5 months with a TX average of 7.6 months.  Home inventory deals with how long – based on the past year’s sales rate – it would take to clear out existing  inventory, with no more introduced on the market.  This depresses the market!    Realtors maintain that home ownership has a significant impact on net worth, educational achievement, civic participation, health & overall quality of life.  Home ownership also helps create job & many analysts say the housing market is the key to recover.

Overlays are intended to ensure that loans are offered only to borrowers who have the ability to make the payments, according to Tom Goyda, a spokes for Wells Fargo in St. Louis.   The lender has to ensure the people loaning the money that the borrower can afford the payments and will pay.  Those with higher credit scores and down payments  -  loans and interest rates likely will get better deals as opposed to folks who are not as qualified.  FHA will still do 3.5% cash down loans, but credit score could be a minimum of 500, but more likely a 640 gets it now.   The FAH overlays may have the greatest impace on borrowers who are on the margin of qualifying an FHA-insured loan.

Why does one buy?  For a place to raise & educate children, a place where the family will feel sale, plenty of living space and to have control over that space.  PRICES COULD CONTINUE TO FALL, but will hit bottom soon & have in some price ranges & locations + interest rates are still low, so DO IT NOW.  It will probably be into 2014 or 2015 before we will see an appreciate in homes, but in the meantime you have a place to live that you like and put your money into.

This law helps strengthen a property owner’s right to defend again eminent dmain from both U. S. and Texas govt. agencies & private entities.  The bill was one of Governor Rick Perry’s “emergency” initiatives for the  current legislative session.  This bill was spearheaded by Todd Staples an owner/Realtor in Palestine and currently the commissioner of agriculture.  Todd is now running for lieutenant governor.

Expect thenumber of households choosing to rent to go up, credit underwriting to remain tight, inventory of available properties to continue to rise and Texas home prices to remain stable through 2011.  Home values have taken a beating the past several years.  The federal Reserve estimated U. S. households lost nearly $6.7 trillion in home equity since 2005, nearly half the total value.  We could be headed for a “double dip” this year.  Most major home price indicators are suggesting another round of declining home prices is now occurring.  The stimulus of a year ago may only have delayed market stabilization by shifting demand forward to take advantage of the benefits & depleting future demand that could lead to recovery.

Newly built homes in 2015 will be smaller, they will include more environmentally friendly features & their living rooms will either merge with other spaces in the home or be eliminated altogether, according to a study by the National Association of Home Builders.  Survey respondents say they expect the average size of single-family homes to be 2,152 sq ft by 2015 or 10% smaller than ones now being built.  2/3 said their homes would have more green features, with 29% putting in more technology features, 20% with universal access & 10% more outdoor living space.  More than 52% expect the living room to merge with other spaces in the homes, while 30% said it will vanish to save square footage.  So-called Great Rooms and walk-in closets in the master will become more common, while 2nd master bedroom suites, sunrooms & media rooms will be less popular.

TAR (Texas Association of Realtors) released 1st quarter 2011 figures & TX homes maintained their value.  This despite a decrease in sales volumn, indicating that the economic recovery continues in TX.   While there was a decrease in sales, it is encouraging to see homes prices hold their value in the 1st quarter.  The median price of existing single-family homes increased 1.3% to $143,300 compared to the 1st quarter 2010.  Volume of home sales decreased by 7.3% from previous year.  Remember there was NO stimulus as in March of last year with the homebuyer tax credit.  While down some, not as much as expected with no stimulus.  TX has a 7.5 months inventory, which is higher in the Tyler area.  This indicates that TX is absorbing foreclosures and other distressed properties without experiencing harmful excess supply.

Iridescent light bulbs, low-flow plumbing & energy-efficient windows are among the new considerations for building a home these days.  GREEN realestate is more ecologically sound & environmentally friendly is resonating with a new generation of home buyers concerned with environmental impace & utility costs.  Need to stretch our dollars.  The demand for GREEN realestate will continue to grow as ecological awareness increases & improvements in technology offer new ways to lower utility costs, reduce emissions & leave less of a carbon footprint.Sales of existing single-familly homes in TX were down 12% last month from a year ago, when we still had the tax credit.  So the economy is hopefully holding its own without the credit.  Median price rance remained unchanged at $144,100 with a TX inventory at 7.6.  Tyler’s inventory is more like 11.8%, which is not good.  This according to Dr. Charles Gilliland, Economist with the Real Estate Center at TX A&M.

The TX economy continues t0 outperform the U. S. economy, according to the Real Estate Center’s latest MONTHLY REVIEW OF THE TEXAS ECONOMY.  From March 2010 to March 2011, TX gained 237,900 jobs, an annual growth of 2.3% , but during the same period U. S. nonfarm employment rose 1%.  The state’s seasonally adjusted unemployment rate fell form 8.2% to 8.1% and the nation’s decreased from 9.7 to 8.8%.  All TX industries except financial activities & information industries had more jobs during that year period.  Odessa ranked 1sr in job creation followed by Midland, Longview & Dallas-Plano-Irving.  Midland had the lowest unemployment rate followed by Amarillo, College Station, Lubbock and San Angelo.

TX is fortunate as it has the best affordable housing policy, which allows builders to build on demand.  Other states have regulations that artifically set quotas, etc.  TX is also seeing a hugh migration of people because of jobs & the warmer climate.  The HOUSING MARKET IS DRIVEN BY JOBS.  A year ago we had the tax credit, which spurred home sales, but this year number of homes sold is same as 2010, but NO STIMULUS.  Shows the market is climbing back on its own power.  People are holding back, thinking prices will fall more, but people should buy homes on normal factors,  such as whether it meets their lifestyle.  All of this according to Dr. Lawrence Yun, chief economist for the National Association of Realtors.  Mortgage rates are low, but lenders have tight underwriting standards & this is holding back the market.  Lenders have plenty of cash, but are reluctant to take risks.  Banks need to lend again, but could be more stringent.  Interesting, the foreclosure rate for HABITAT FOR HUMANITY  is LOW.