Real Estate Information

President Obama or President Romney … either way interest rates are sure to go up.   Our country can’t keep borrowing 40 cents of every dollar it spends and expect inflation will not drive up interest rates.  The United States has borrowed 16 Trillion dollars to pay for things it couldn’t afford. The government is expanding the money supply. 

I remember the 1979-1982 recession.  I was a young real estate agent struggling to make a career selling homes at 19% mortgage rates.  A mortgage of $200,000 at today’s rate of 3.75% interest has a payment of $1,572.90 (PITI - principle, interest, taxes,insurance) + (MIP - mortgage insurance premium).  Compare that to a mortgage of $200,000 at 19%...  $3,824.45 (PITI+MIP).  Let’s hope we never see those rates again.

It’s not my job to help with your voting decision… but I would like to advise you on your real estate.  One thing I know for sure.  Either buy NOW or refinance your current loan NOW… or you may be priced out of the market.  Call me either way.  I’ll help you buy a house, sell your house or hook you up with a great lender.  614-296-8350.    

What if work wasn’t just work? What if work was a vehicle to live and share a bigger purpose?

There’s a flawed perception in our society that in order to live a life of purpose we have to leave our jobs and go solve world hunger, feed the homeless, move to Africa or start a charity.

Consider:

A janitor who worked at NASA and even though he was sweeping floors he felt his bigger purpose was contributing to put a man on the moon.

A bus driver who knows his purpose is to help kids stay off drugs.

An administrative assistant who has become the Chief Energy Officer of her company.

A woman in the mortgage business who sees her job as a way to help couples save their marriages by keeping their homes.

A Popeye's Chicken employee in the Atlanta Airport who makes thousands of air traveler's smile each day. 

All ordinary people with an extra-ordinary purpose.

Every job, no matter how glorious or boring it may seem, will get mundane if we let it.

Purpose keeps it fresh and when we are filled with purpose, we tap into an endless supply of energy.

The Jacobus Real Estate Group's purpose is to strengthen our clients families by helping them make wise decisions in the purchase or sale of their home. 

 We help our buyers make a sound  investment in the purchase of their home which will provide a place to create wonderful family memories as well as reward them with profit when the time comes to sell. 

Helping our sellers maximize their profit by consulting on the preparation, presentation and the marketing of their home, we help them move toward their dreams and goals for the next stage of their life.

Check out this complete newsletter from Jon Gordon at http://www.jongordon.com/positive-tip-bigger-purpose.html

In your wildest dream did you think you would ever see a 3 1/2% 30 year loan???  Or a 2.75% 15 year loan???   

In January 1979 rates were 7% and by December they were 18%.  I would hate to think they will go that high, but I never thought they would be this low, either.   

These low rates are good for those who can take advantage of them.  If you are in a position to buy a house, buy an investment property, or refinance your house, you need to consider it NOW!!!  

I'll help.  Contact me for advice.  If you want to buy (or sell) I can help, if you want to refinance I can refer you to a lender with great rates. 

Your friend in the business, 

Yes, Gomer (as in Gomer Pyle) FHA's upfront fee is practically doubling...from 1% to 1.75% of the loan amount.  Just to make sure they have enough money to squander the monthly fee goes from 1.15% to 1.25% (it had already gone up from .75% a couple years ago).  What does all this mean?

On a $200,000 mortgage, the upfront FHA mortgage insurance fee goes from $2000 to $3500 and the monthly FHA insurance fee goes from $191.67 to $208.33 per month.   Long story short, because of the losses sustained by their own mismanagement (only my opinion) they need to increase their fees.  The fee increase, effective on loans after April 9th, will lower the amount of mortgage for which you qualify by $3500...besides increasing the closing costs by $1500 and adding $16.66 to the monthly payment.

What's the take away?  If you are buying a house utilizing an FHA loan, do it before April 9th!   In fact, I want to see you get the lower fees so badly, I'm offering to help you find your house!   Just call me.    

I just got back from a dynamic week in Las Vegas at the RE/MAX International Convention.  Several speakers shared information that we are poised for a rebound in real estate values.  One speaker had bar charts showing the rebound after every recession. Another had information that the foreclosure problem is winding down and has been steadily improving since 2009 and should be over by the end of 2013. 

Another speaker showed that residential rentals consistently return 15-25%.  I've owned rentals for over 25 years.  I just ran a Craigslist ad last week for a Westerville house and got 11 inquiries in a week. I picked my new tenant yesterday.  Good houses in good areas attract good tenants. 

Did you know you can use your IRA to buy real estate?  If you're not happy with 1% or 2% return, then you need to consider real estate.  I can help you with that. 

Here is a free seminar coming to town which I have will attend on Tuesday, 3/20 at 12:30.  This seminar is from the author of RICH DAD, POOR DAD.  I don't know what he will say, but I have read his books and he knows his stuff.  Click on this link to check it out and enroll.  http://www.richdadfreeseminar.com/Columbus/11.0000/index.dtm?token=3567

LOW, LOW interest rates and low listing inventory have combined to make a strong market.  Our office has averaged selling almost 3 homes a day since the first of February!  That's fabulous for February!  If you are planning on buying this year, don't wait any longer.  Oil prices are on the way up, which will cause gasoline to go up, utilities costs to rise, food prices to increase... basically that's called INFLATION.  To curb inflation the Feds will raise interest rates to slow the economy.  We've seen this in the '70s and '80s.

How do you prepare for this? 

Buy a house now.  Plant a big garden. Buy a wood or coal stove.  Learn to hunt and fish (see... it's not all, bad.).   Don't make me say, "I told you so".         

If you want to refinance to a lower interest rate, but your home's value is too low, there may be some help.  A government program called HARP... Home Affordable Refinance Program can be utilized even if you owe more than the value of your home.  Your current mortgage has to be a Fannie Mae or Freddie Mac prior to May 31, 2009. If you had mortgage insurance, you still have to retain mortgage insurance. If you did not have mortgage insurance you will not be required to get mortgage insurance. Loans can be as high as 110% - 125% of the appraised value.  There are restrictions and the rules constantly change, so you have to consult a mortgage professional.  You are welcome to call me and I'll refer you to mortgage companies who do these loans.   

2012 will continue to see a lot of homes foreclosed or sold via short sale.  Lenders have gotten up to speed and hired staff to handle the huge short sale caseload.  Lenders are more willing to renegotiate or approve a short sale than ever before.  We advise using an attorney and a Realtor who are very experienced with short sales.  That means a track record of successfully closing short sales.  A short sale is an alternative to foreclosure.  The lender is "short" of getting the loan paid in full.  It does ding your credit, but nothing compared to a foreclosure.  It costs nothing upfront to try and renegotiate your loan or find out if you  qualify for a short sale.

On the other hand, if you want to buy a short sale, the advice is about the same. Use a very experienced Realtor.  Only 1 out of 3 short sale listings end up with a successful closing.  A knowledgeable agent can help navigate the long painful process of buying a short sale, but the experience is never fun.  If you have a timeframe you need to be in your new home, don't even consider a short sale.  Short sales are for only those who want a great deal and are willing to try 2 or 3 houses before getting one to closing.      

There was an article in the Dispatch last weekend that may have shocked you if you are planning on buying a house  this year.

The article was written from the perspective of a nationwide status of real estate.  He projected values to fall another 2% or 3% this year. That may be the case if values are averaged.  However, as they say "All markets are local."  Central Ohio is better off than most areas of the country.  Some areas of central Ohio have experienced double digit increases for the last couple of years!  If you are going to buy this year, just get an agent that knows the market and can produce the stats to prove them.       

We are ending the year on a high note.  Lending has loosened a bit and inventory is down 20% - 25%.  While average prices of homes still declined 4% in 2011, non distressed homes declined just 1/2%.  Shadow inventory... homes with financially distressed owners are estimated at 4 million units.  That will effectively keep prices from rebounding for another 2 years.  2014 is projected to see 2 1/2% increase in home prices.  Wish I could say the same about interest rates!  Rental property will continue to be the strong segment of the market as there will remain a high demand for rental homes.  Locally, we have seen an influx of people taking their money from nonperforming investments and buying rentals.  It may be hard to get a 2% return on your savings, but the same money invested in a rental could easily return 15% - 20%.