Jan 28, 2014 | Housing Analysis
The NAR provided great year-end news as existing home sales in December pushed 2013 sales of existing homes to a 7 year high. December’s reading of 4.86 sales of pre-owned homes came in at 4.87 million on a seasonally adjusted annual basis.
Although projections had been for 4.89 million sales, the December reading topped November’s revised sales of 4.82 million pre-owned homes.
December’s reading showed the first gain in existing home sales in three months. NAR reported that existing home sales for 2013 reached 5.09 million, which represented a 9.10 percent increase over 2012.
More Good News: Median Price Of Existing Homes Rises
NAR reported that the national median price for pre-owned homes increased to $198,000, a year-over-year increase of 9.90 percent. The average price of an existing home for all of 2013 was $197,100. This was the strongest growth in existing home prices since 2005 and represented an increase of 11.50 percent.
There were 1.86 million pre-owned homes for sale in December. At current sales rates, this represents a 4.60 month inventory. Real estate pros like to see a minimum of a six-month supply of available homes, so existing homes remain in short supply.
Analysts attributed rising home prices to improving economic conditions and a persistent shortage of homes for sale.
FHFA: Slower Gain for Home Prices In November
FHFA, the agency that oversees Fannie Mae and Freddie Mac, reported that November prices of homes financed with mortgages owned or guaranteed by the two agencies rose by a seasonally adjusted 0.10 percent as compared to October’s increase of 0.50 percent and an expected growth rate of 0.40 percent.
November’s reading brought year-over-year home sales to an increase of 7.60 percent, but is still 8.90 percent below their April 2007 peak.
Analysts noted that recent reports of increasing new home construction and rising new home sales as reasons why prices of existing homes are seeing slower growth.
Jan 27, 2014 | Mortgage Rates
Last week was an action-packed week for economic news, and all of it was packed into Thursday:
Weekly Jobless claims came in at 326,000 which was lower than the expected 330,000 new claims. This week’s claims were higher than the prior week’s 325,000 new jobless claims filed.
The NAR released its Existing Home Sales Report for December; sales of existing homes sold at a seasonally adjusted annual rate of 4.86 million.
December’s reading fell shy of estimates of 490 million existing home sales, but the estimate was based on November sales that were later adjusted downward to 4.82 million sales of existing homes. Existing home sales for 2013 came in at 5.09 million sales, a 9.10 percent increase over 2012 sales.
The median price of a pre-existing home reached $198,000 in December, with the median price for all of 2013 at $197,100, which was an increase of 11.50 percent over the average price for an existing home in 2012.
Pent-up demand and a lingering shortage of available homes likely contributed to last year’s rapid rise in home prices.
Mortgage Rates Mixed, FHFA Reports Slower Gain For Home Prices
Freddie Mac reported mixed results for average mortgage rates in its weekly PMMS report. The rate for a 30-year fixed rate mortgage fell from last week’s 4.41 to 4.39 percent.
The average rate for a 15-year mortgage dipped by one basis point to 3.44 percent; discount points for both 30 and 15-year mortgages were unchanged at 0.70 percent.
The average rate for a 5/1 adjustable rate mortgage rose from 3.10 to 3.15 percent with discount points unchanged at 0.50 percent.
FHFA, the agency that oversees Fannie Mae and Freddie Mac, released its Home Price report for November 2012. This report is based on information gathered about homes with mortgages owned or backed by the two firms. According to FHFA, home prices increased by 7.60 percent year-over-year.
Home prices moved up by 0.10 percent in November as compared to a rate of 0.50 percent in October.
Leading Economic Indicators Suggest Economy Strengthening
The Leading Economic Indicators report for December moved up by 0.10 percent, which pushed the index to a reading of 99.4. December’s reading represented the sixth consecutive month that the index gained ground.
Economists associated with the LEI report note that while steady growth is expected during the spring, the economy will likely encounter a few obstacles including rising interest rates and possible political gridlock over raising the national debt ceiling.
This Week
This week’s economic news is set to include New Home Sales, the Consumer Confidence Index, and Weekly Jobless Claims. Freddie Mac’s PMMS mortgage rates and reports on consumer spending and consumer sentiment round out the week’s news.
The FOMC statement expected after the committee concludes its meeting on Wednesday is expected to provide news of the Fed’s plan for further tapering of its quantitative easing program.
Jan 24, 2014 | Around The Home
In most parts of the country, garages are especially appreciated at this time of year. Even if you don’t live in a colder climate, it’s important to do an annual inspection and routine maintenance to keep everything in working order.
Make sure yours is doing its job well by following the care tips below.
Check The Tracks
You’ll want to make sure the garage door can go up and down smoothly. Get your leaf blower and blow any cobwebs, bugs or leaves from the track.
With older doors, you’ll also need to oil the metal rollers, hinges and tracks in order to keep everything moving easily.
Inspect For Pests
This time of year, pests are searching for a warm place to take shelter and find food. Look along the walls where they meet the foundation and double-check any spots where you’ve had moisture problems.
If you see chewed wood or trails of sawdust, call an exterminator because they could be signs of termites or carpenter ants.
Insulate Your Garage
If you have a workshop or gym located out in the garage, then insulating this space is a must for colder climates. Not only will it make your home warmer, but also it will reduce your electricity bills. You can buy DIY kits for under $100.
However, be careful if your door is over nine feet wide, because the extra weight can be too much for some opening mechanisms.
Spend Time On The Floor
Don’t actually get down on the floor, but definitely give it some care. Move everything out and hose down the entire surface. Patch any gaps to prevent tripping. Then give the foundation a good inspection.
If you notice mold or major cracks, call a contractor to come take a look and see if you have settling or water drainage issues.
Consider Replacing The Doors
You’ll know it’s time to replace your door when the panels are rusted and scratched or there are wooden ones that are warped. There are many decent replacement options, including wood, steel or aluminum.
The prices can range from high to reasonable depending on the quality of the material. If you decide to do a replacement, talk to an expert and take your climate into account.
Jan 23, 2014 | Around The Home
Houseplants are great for decorating. They can brighten up any room. Plus, houseplants can increase the air quality in a room. That makes you happier, healthier and reduces stress.
Speaking of stress, these plants won’t create any at all. All of the plants on this list are great at producing oxygen and require very little care.
10. Heartleaf Philodendron
A tough plant that’s a good filter for toxins like formaldehyde, Heartleaf Philodendron makes a great houseplant. The only downside is that it’s toxic to eat, so it may not be the best choice for those with kids or pets. But if you can control your appetite, the Heartleaf Philodendron is an excellent indoor houseplant for air quality.
9. Snake Plant
Also called Mother-in-Law’s Tongue, the Snake plant thrives in the bathroom. It loves the steamy conditions and can do without much light. It’s a great air filter as well.
8. Bamboo Palm
It thrives indoors and requires little maintenance. The Bamboo Palm even produces flowers and berries.
7. Red-edged Dracaena
Another great air filter, the Red-edged Dracaena is interesting because of its size. It can grow all the way to the ceiling. This beast of an oxygen-producing plant makes a great addition to the living room.
6. Chinese Evergreen
This is one of the prettier options. With interesting leaf colorings as well as berries and blooms, the Chinese Evergreen will contribute to your décor as well as your air quality.
5. Peace Lily
The Peace Lily only needs water about once a week. This is a great houseplant for air quality, and it’s easy to care for.
4. Devil’s Ivy
This air purifier looks great in a basket. Try hanging it in the garage.
3. English Ivy
English Ivy is an excellent filter plant. It’s been shown to filter out formaldehyde, which can be found in some cleaning products, and it even filters fecal matter particles (I bet you didn’t even know there were any of those in your house). English Ivy is an invasive species though. It’s fine to keep inside as a houseplant, just make sure it doesn’t end up in the yard.
2. Weeping fig
A type of Ficus, this is a great houseplant for air quality. It’s a bit bigger than the others though. It would fit best in the living room.
1. Spider Plant
The Spider plant is nearly impossible to kill. Even if you’ve been a plant murderer in the past, try this one. It will do wonders for your air quality, and I promise you won’t kill it.
Houseplants have been shown to reduce stress in the home. Combine that with higher air quality and your quality of life can be greatly improved with the help of a new green friend.
Even if you don’t have a green thumb, you can take care of these. These are great houseplants for air quality.
Jan 20, 2014 | Home Buyer Tips, Home Seller Tips, Interesting Stuff
An LLC is a valid and effective way to hold and manage real estate. An LLC is recognized 
as a separate legal entity for tax and liability purposes.
1. An LLC can provide certain tax and liability advantages. In certain circumstances, holding title to real estate in an LLC can provide a valuable tax advantage. However, if the main intent of forming an LLC to hold real estate is for its tax advantages, you should be sure to speak with a qualified tax advisor. Be certain that you obtain a specific tax identification number from the IRS for the LLC. Applying for an Employer Identification Number or tax id is a rather simple process and can be done online. You will need to provide a tax id number to the closing attorney.
2. There is a cost to create and maintain an LLC. The cost to file for and create an LLC in Massachusetts is around $500.00. This does not include the cost of legal counsel. An annual report will need to be filed with the Mass. Secretary of State each year at a cost of $500.00 per LLC. In most circumstances, if the intent of having an LLC is to avoid legal liability associated with the ownership of real estate, you should probably have two LLCs. One LLC to hold title and one to manage the property. Be certain that the application to create an LLC and operating agreement are prepared properly. Mistakes made in filing for an LLC can be costly and time consuming to correct. Don’t file for an LLC in any other state or jurisdiction unless you have a really good reason for doing so. Cost should not be the sole reason. Consult qualified legal counsel to assist you.
3. An LLC is not right for every situation. Although an LLC can hold title to real estate, it does not mean that it is the best way to do so. You should carefully consider the pros and cons of using a realty or nominee trust, a standard corporation, or individual ownership for each piece of real estate. We often find that sellers spend needless time and money to hold title in an LLC when it really was not necessary or proper for their situation. It may be considered “fashionable” to have an LLC, but it is not always prudent.
4. An LLC is not like a regular corporation. One of the primary differences between an LLC and standard corporation, or S Corp, is the way gains and losses are accounted for between members and shareholders. With an LLC, gains and losses can be allocated disproportionately between members, not so with an S Corp where it is shared between pro-rata shares of ownership. With LLCs, members are able to pass losses to their personal income reporting. This can’t be done with a regular corporation.
5. An LLC must be in good standing with the state in order to sell its real estate. If your LLC holds title to Massachusetts real estate you will need to prove that the LLC is in good standing with the State before you can actually close on the sale. The most acceptable way to show good standing is to obtain a certificate from the Secretary of State’s office. The Secretary will not issue a certificate if the LLC is not current with its annual report filings. The cost of a Certificate of Good Standing is about $25.00. Obtain it well in advance of an anticipated sale, the closing attorney will likely require it prior to closing.
