Why Do Mortgage Rates Go Up When They Should Be Going Down?

Consumers are often misled when it comes to the subject of the Federal Reserve and how it affects mortgage interest rates. Often the media is the culprit causing the confusion. Many times, the Fed has taken action causing mortgage interest rates to move in a direction other than what consumers expected, because the media provided weak reporting on the subject.

What The 2010 Census Wrought

Here is a link that will take you to the New York Times mapping of the results of the 2010 Census. Give it a click and roam around. It’s pretty interesting. http://projects.nytimes.com/census/2010/map?nl=todaysheadlines&emc=thab1

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If you would like to talk about your situation, buying or selling, please don’t hesitate to call me at 281-582-3925. I will get back to you as quickly as I can if I am not there. You can also email me at slandreth@heritagetexas.com

© 2012 Scott Landreth

The Houston Chronicle: Front Page Article About Houston Real Estate

Today’s Houston Chronicle above-the-fold front page headline (Buyers flocking to buy homes in some city neighborhoods) surprised me. Not because it’s a seller’s market on the west part of town and not because inventory is down and decent houses priced right are flying off the market. None of that.

It’s because The Chronicle chose to use John Mallon, who sold his house in Spring Branch, as one of the examples supporting the thesis of the article. Mr. Mallon and his family bought my listing in Briargrove Park in another competitive situation. Indeed, I received three contracts each one higher than the next from highly qualified buyers.

In a nutshell, if you are contemplating selling your house, now would be a good time to do it. The market has been picked over like the carcass of a wildebeest in the Serengeti. Anything new is going to get a lot of attention. There is only one caveat: don’t overprice it. You may think that a tight market will generate higher prices. It will, but not unreasonably so. Buyers have a lot information at their disposal and they are not stupid.

The fact that The Chronicle ran this positive article in such a prominent position on the front page suggests that Houston is alive and well. The fears engendered by the last couple of years of poor economic data should not slow you down any more.

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If you would like to talk about your situation, buying or selling, please don’t hesitate to call me at 281-582-3925. I will get back to you as quickly as I can if I am not there. You can also email me at slandreth@heritagetexas.com

© 2012 Scott Landreth

Houston Employment At Record Levels – That’s Good For Housing

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In a nutshell, if you don’t have a job, you can’t get a mortgage. With no mortgage, if you’re like most people, you can’t buy a house. So the fact that employment in Houston is at record levels bodes well for our future, especially the housing market.

Employment is therefore a leading indicator relative to housing sales which should start to come out of the doldrums this year. Mortgages may be harder to get than in the past, but jobs provide the grease to propel real estate transactions and valuations.

If you would like to talk about your situation, buying or selling, please don’t hesitate to call me at 281-582-3925. I will get back to you as quickly as I can if I am not there. You can also email me at slandreth@heritagetexas.com

Data is Based on information from the Houston Realtors® Information Service or its MLS for the period 1/1/2007 through 12/31/2012.

© 2012 Scott Landreth

 Coverage Area  http://wp.me/POdGS-1E

Termination Option? You Must Be Nuts

A few years ago, I got a call from an attorney who happened to be the uncle of one of my clients whose house I had listed. The sellers (my clients) had just accepted and executed a contract that included a Termination Option. The attorney/uncle lit into me like a Hellfire missile flying up the exhaust of a Soviet T-62 battle tank. His beef, which he made amply and loudly clear, was his nephew’s agreement to extend to the buyer an unrestricted option to terminate the contract. Adding insult to injury, the seller did not have an equal reciprocal right. He claimed that my company and I were offering bad advice and that we should have our licenses revoked and, further, tarred, feathered, and quartered by stampeding stallions. As the assault lost steam and I was able to get a word in, I tried to explain how Paragraph 23 of the Residential Sale Contract worked.

Appraisal Changes arrive September 1!

FNMA (Fannie) and FHLMC (Freddie) have implemented a Lending Quality Initiative (LQI) with several phases that began in 2010. The current phase of the LQI program is focused on the quality of appraisals. The theory is that less subjectivity and more standardization will improve consistency and quality. Appraisal forms are being modified in the key areas that caused problems in the past. Home characteristics that were previously considered subjective are now defined with ratings. Here are the specific areas of change:

Houston Homes – At What Price?

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It’s one thing to say the market is coming back in term of units sold. It’s quite another to say prices are higher today than they were in 2007, a strong year. Except for a dark patch at the end of 2008 and the beginning of 2009, prices have been appreciating at a rate of about 5.1% per year in the coverage area since the beginning of 2007. This may sound like a lot. IT IS!!!

I have repeatedly said that Houston has not been subject to the same price appreciation rates as California, Florida, Arizona and Nevada. Thank God! They were the ones with the bubbles that exploded leaving many in ruin. Houston had no such stress. Nevertheless, the devil really is in the details. As the chart shows, average home prices have increased overall, but only because fewer lower priced homes have sold. (See my prior post dealing with unit volume sold.) To see what really happened follow this link to a quick slide show of trends by price segments. Houston Price Trends by Segments (If you are unable to view the slide show, send me an email or make a comment and I will fix it.)

If you would like to talk about your situation, buying or selling, please don’t hesitate to call me at 281-582-3925. I will get back to you as quickly as I can if I am not there. Or, send me an email at slandreth@heritagetexas.com .

Based on information from the Houston Realtors® Information Service or its MLS for the period 1/1/2007 through 7/31/2011.

© 2011 Scott Landreth