Real Estate Information Archive

Current Market Advice

Monday, June 30, 2008

by John Jacobus

A young couple asked me when the best time to buy a house is. They wanted to know if they should wait until the market bottomed out. Good question. Since they were first time buyers, here's what I told them. It's an excellent time to buy. Home prices in good areas under $200,000 are not decreasing. They're not increasing very fast but they're certainly not decreasing. Depending on your situation, here's how I would have answered you had you ask.

BUYERS

First time buyers: Buy now. Owning is still better than renting and you won't hear your neighbor yell at the kids.

Investors: Are you kidding. This is the best rental market I've seen. Good areas only, though.

Incoming Transferees: Get a good Realtor, buy in an appreciating area, and buy a median priced house. Forget the status house if you don't want to leave some of your money behind when you leave.

SELLERS

Downsizers: Under $250k sell now. $250 - $350K you're not going to be happy. Over $350K wait if you can. That market may come back in a couple years. The higher priced homes are taking it on the chin right now.

Cashing outers: If you're retiring you may not have the luxury of waiting.

Financial Strugglers: Deal with the problems now. If you're sinking, don't wait until you're under water to start bailing.

Investors: You may want to sell and take your capital gain while it's still taxed at 15%. Both presidential candidates will probably change that... my guess is it won't be to your benefit.

Outgoing Transferees: Look hard and long at relocating if you are not forced to in order to keep your job. Only 7 real estate markets in U.S. are doing better than central Ohio! (Mostly low tax states... imagine that!)

Remember the market is neither good nor bad. It just is. It's your perspective that makes it good or bad.

Market Update

Wednesday, June 25, 2008

by John Jacobus

MARKET UPDATE The market continues much like it has been for the last 2 years. According to the Ohio Association of Realtors, average homes values in Ohio decreased about 12% from this time last year. Of course nothing is average so your property may have fared better... or worse. The $150,000 to $250,000 market remains strong, (sellers market). The $250,000 to $350,000 market is weak... over supply of homes, (buyer's market). The $350,000 and up market gets real tough. The higher the price the worse it gets. Interest rates have also started to increase. The best buyer's market in 35 years will still be good... great even but not as good as when mortgage rates were 6% or less.

According to the statistics sent out by the Delaware County Auditor, homes are selling at a rate about 80% compared to last year. Sale prices have declined about 7.5% from last year.

Now for some good news. According to the Columbus Board of Realtors IN CONTRACT magazine, Central Ohio is the 3rd most stable housing market in the country. Central Ohio will boast the nation's 8th fastest home sales rate in 2008. Columbus (central Ohio) is the # 1 Up-and-Coming Tech City, (Forbes.com 3-10-08).

John's Forecast: Tonight will be dark. Skies lightening up by morning. More hot air than normal between now and election day, then we'll be back to the same old thing.

Basements

Wednesday, June 18, 2008

by John Jacobus

I recently sold a home that had some basement problems. The seller and I were aware that the rear wall had bowed and probably needed support. I called our basement specialist and he confirmed our diagnosis. He also showed us the front wall had moved and also needed support.

I see all sorts of amateur attempts of reinforcing basement walls. I've seen angle irons, bed rails, 4" wide carbon fiber glued to the walls and one basement actually had wood 2x4s! The proper way is to use 4" I-beams set on the foundation and torqued and bolted to the floor joists.

The best way to maintain basement walls is to keep a positive slope draining water away from the house and don't allow tree roots to put pressure on the walls. (Cheri, that's why I keep pruning your red bud and river birch tree that you planted too close to our house... well that and I don't want leaves in the gutters. I just cringe seeing you up on that ladder cleaning gutters!)

Credit Scores

Wednesday, June 11, 2008

by John Jacobus

WHAT IS A CREDIT SCORE?

Lenders want to know two things about a borrower: ability to repay and willingness to repay.

The first requirement is based on the debt to income ratio and the second is based on the dreaded "credit score"

Credit scores do not consider income, assets, down payment or demographics.

Past delinquencies, derogatory credit behavior (remember your mom slapped you when you were derogatory!), current debt level, length of credit history, and types of credit as well as number of credit inquires factor in the score.

Each portion of the credit history is given differing weights.

35% of the FICO score is based on specific payment history.

30% is based on the level of indebtedness

15% is based on the time credit has been in use

10% is based on the types of credit available but unused

10% is based on the pursuit of new credit as revealed by the number of inquires in the past 90 days.

So there you are. The answer to the question you always wanted to know but was too afraid to ask.

Protect your credit! When getting ready to buy a house... don't do anything with credit until you talk with a qualified mortgage loan originator. Acquiring a new loan obviously will lower your score.... but so will closing an old account you haven't used for 10 years. Increasing a loan limit may increase your score! Go figger.

(Information compliments of Jeff Lichtenstein and Jim Hawkenberry of Market Mortgage.... 614-846-5626)

Who do you know that needs a knowledgeable Realtor or lender?

John Jacobus, ABR, GRI, CRS

RE/MAX Impact
Broker/Owner
440 Polaris Pkwy
Westerville, OH 43081
614-523-1000
Cell 614-296-8350

John@johnjacobus.com

www.johnjacobus.com

Credit Scores Real Estate Tips