So, since such questions are not being asked in my day-to-day conversations, I thought I would ask them for my readers - because I think the answers to them is information many of us really want to know.

Q: I hear that FHA guidelines are changing. Is this true? And if so, what does this mean?

A: Yes, FHA has recently announced many changes to their loan programs.

• First, FHA is increasing the up-front financed mortgage insurance premium (MIP). The current MIP is 1.75% and is proposed to increase to 2.25%. This means for every $100,000 loan, it will cost you an additional $250 +/- in up-front premium charged.
• Second, FHA is changing the seller concessions from 6% to 3%. This means that, on a $100,000 loan, a seller would only be allowed to pay up to $3,000 of your closing costs. Currently, a seller can contribute up to $6,000, which is enough to cover most of the closing costs and prepaids necessary to obtain the maximum FHA loan.

Q: Will it really make much difference if I wait or don’t take advantage of the tax credit?

We have said this before, but if you are considering buying an Austin home in 2010, it makes prudent financial sense to take advantage of the incentives that are time sensitive. The pragmatic reasons follow:

1. If you will take advantage of FHA financing (loan amounts up to $288,750), waiting will only cost you more money. As I mentioned before, the cost of FHA financing, due to the national delinquencies, is increasing.
2. If you are a First-time Homebuyer, you have until April 30^th to take advantage of <up to> a $8,000 tax credit. That is $8,000 that will NOT be available to you after May 1! Learn more about the tax credit.
3. If you are a Move-up Homebuyer, you have until April 30^th to take advantage of <up to> a $6,500 tax credit. That is $6,500 that will NOT be available to you after May 1! Learn more about the tax credit.
4. Interest rates have been highly favorable because the Fed is buying mortgage-backed securities, which is keeping interest rates artificially low. The authority to buy these securities is reported to end in April. This means that Interest Rates will most probably increase once the Fed quits printing $trillions in cash to help the housing market.

So by waiting, what could it mean? To make the numbers real, let’s produce a few likely scenarios:

* Closing Costs guestimated to this amount
** We have no idea how high Interest Rates will jump - we simply took a more historical Interest Rate to make our ‘what if’ calculation

Q: Based on the graphs, what would it cost to wait?

• Scenario 1: costs an extra $8,750 out of pocket plus an extra $332/month
• Scenario 2: costs an extra $6,500 out of pocket plus an extra $309/month

Q: But these incentives are for buyers only; why do I care as a seller?

In many of my conversations of late, people are talking about waiting until the Spring or Summer to sell. However, by then the buyer incentives (tax credits) will be gone, financing will be more difficult and if interest rates rise the cost of buying increases. What do you think this will do to the pool of buyers in the market available to buy your home? Enough said?

At the GoodLife Team, our advice to both buyers and sellers is to learn what the REAL market conditions are and what they mean to you in terms of your dollars and cents. And, after understanding the current real estate marketplace, then make a prudent decision that matches your goals. Don’t get caught up in the media hype and don’t listen to what others are saying that are likely to not really know what they are talking about. Get informed, make good decisions. In other words, ask good questions of your real estate professional and lender.

Let me know your thoughts!

Krisstina

This year’s Tour featured 16 homes - 11 for sale and 5 architect showcase homes. The hip modern homes were spread throughout Austin and ranged in price from the high $200s up to $3.5 million. The homes, all urban, made it possible for attendees to visit several homes within a short time span. According to one attendee, ‘It was very thoughtful planning - we saw 10 homes but we only drove 36 miles in total.”

This year, the GoodLife Team partnered with Launch787 for event management and promotion. Launch787 clearly demonstrated their expertise in the realm of event management, making for an easy and effective partnership. ‘We look forward to working with Launch787 on future tours and events,’ said Krisstina Wise, Modern Home Tour founder and principal of the GoodLife Team.

Thanks to all who took our survey - the results follow! And, don’t feel left out; if you didn’t participate and would still like to give your feedback, take our poll and post your remarks on our Facebook page.

Survey Results!

If you are on Facebook, take our quick poll to let us know your favorite home. We would love to hear what you thought of the tour, please provide your comments. Finally, look for more tours to come in the future.

Single Family Monthly Graphs

Note to readers: The Wise Assessment is posted every month. We post our stats later that other real estate companies because we want the most accurate numbers available…and this makes them worth waiting for! Other agents simply copy and paste graphs that they get from other sources and offer no opinions to the marketplace conditions. We track data in house and compare the market on a whole to what we produce internally in order to produce an opinion of the data and give our thoughts of what we are personally experiencing as a top company in Austin.

Keep reading for the written Wise Assessment and/or listen to our interpretations on our latest VLOG:

Overall Market Summary Report

The Wise Assessment

SELLERS: The number of single-family homes that were available for sale took a nose-dive at the end of 2009. The average sales price sky-rocketed to a never-before seen level of $261,000. While this may seem to be an excellent indicator of a recovering market and proof that now is a great time to sell for a very high price, we must first investigate the finer details and statistics before making interpretations. See the Average Sales Price graph and narrative below for our Wise Assessment on this phenomenon.

Is This A Good Time To Sell? We are meeting with clients on a daily basis who are asking this specific question. A general rule to follow when determining if now is a good time to sell:

1. Move-up: if you are selling a home and looking to ‘move-up’ or buy a more expensive home, the very best time to do this is when the market is down (like now)
2. Move-down: if you are selling a home and looking to ‘move-down’ or buy a less expensive home, the very best time to do this is when the market is hot (not now)

While this is a good general rule to follow, your specific circumstances and needs must be considered before making a decision.

BUYERS:

Interest rates remain low.

Home prices remain low.

Therefore, your monthly payment will be lower now than when either or both interest rates and home prices increase.

I assess that, even though it appears that home prices are increasing (see the interpretation below), the reality is that this is still a very good time to buy…especially before prices and interest rates begin to creep up.

Average Sales Price

“WOW! My home is now worth $50,000 more than it was last month!” While the graph alone would indicate your home is worth 10% more now than it was in November, this is not the whole story. Let’s examine:

• This past fall the government offered 8,000 reasons (in dollars) for first-time home buyers (property virgins) to buy homes before December
• This incentive prompted a large number of virgins to buy homes, which drove the average price down while, at the same time, supply and demand increased
• In December, there was a significant decline in the number of virgin buyers, which drove prices back up
• Also in December, there was a higher percentage of homes sold in the $300K-$1M price range than in previous months

These facts would indicate that we have experienced an anomoly in the market, and your home is likely not worth more today than in November. But, this begs the question:

• Is your home worth more now? The only way to make an assessment of value for your home is to investigate your specific home and see how it compares and competes in the current market.

Sales Closed by Month (Demand)

The number of sales in December followed the seasonal cycle of sales in Real Estate in Austin. While we did experience an unusual number of home sales in September and October of 2009 because of the Virgin tax credit, the market returned to its normal operating procedures once the original credit was scheduled to expire. Barring any disaster, the number of sales in Austin should coincide with the temperature increases….stay tuned and check that weather report!

Active Listings (Supply)

Again, we are following the cyclical trend of there being fewer homes available for sale in the fall and winter than in the spring and summer. We did notice, however, that the number of home sales increased in the fall over the previous years, which caused the supply to remain low.

We are anticipating the inventory to increase drastically in early 2010, as the graph reflects for the previous years, so be on the look out for a greater number of homes on the market in the coming months.

Offers of Help

• What Is My Home Worth? Want to get a good idea of what your home is worth … and find out right now online? Check out our Market Snapshot for an analysis of the value of your Austin home.
• What Is That Home Worth? “Stop the car, honey … look at that house. I wonder what it’s worth?!?” Does this ever happen to you? Ever wonder what that house is worth? Find out the value of that Austin neighborhood or home.
• What do I need to know before I sell? Typically when a home does not sell, there is one reason…and it isn’t price. We invite you to look at several key factors to consider before selling your home. Visit One Reason for more information.

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let us know if you would like a neighborhood-specific analysis by emailing us at experience@goodlifeteam.com or calling us at 512.892.9473.

The data provided to create these graphs are available to you by FREE subscription to our monthly update service.  Please email us experience@goodlifeteam.com to receive your monthly update. Or, catch the wave and follow @GoodLifeTeam on Twitter.

experience@goodlifeteam.com| 512.892.9473  | www.goodlifeteam.com

This year’s Austin Modern Home Tour consists of a driving tour of 16 modern homes in the Austin area followed by a cocktail reception and architect panel at Truluck’s downtown.

In addition to several articles in the Austin American Statesman, the tour is being covered by several of the major news stations, including this piece by Fox News, a live interview with Krisstina Wise:

Learn more about the tour, see the homes, and purchase your tickets at http://glt.bz/mht2010.

Single Family Monthly Graphs

Note to readers: The Wise Assessment is posted on the first day of every month. We post our stats later that other real estate companies because we want the most accurate numbers available…and this makes them worth waiting for! Other agents simply copy and paste graphs that they get from other sources and offer no opinions to the marketplace conditions. We track data in house and compare the market on a whole to what we produce internally in order to produce an opinion of the data and give our thoughts of what we are personally experiencing as a top company in Austin.

Keep reading for the written Wise Assessment and/or listen to our interpretations on our latest VLOG:

Overall Market Summary Report

The Wise Assessment

WARNING: These statistics are BORING! Nothing is on fire, nothing has flooded, and the Austin Housing Market is behaving like it should. This is GREAT news. What this means is that the Austin Real Estate Market is beginning to stabilize, and the drastic shifts in the graphs from Q4 of 2008 and Q1 of 2009 seem to finally be history.

The number of single family Sales in November were 58% higher than November 2008….not terribly surprising since the market was in a tailspin in November 2008 and dipped lower than it has been in over 5 years. Does this mean the market has fully recovered and we are in for a great 2010? In my opinion, 2010 will be a slow and steady year building a stronger foundation for a stronger economy - both overall and specifically in real estate.

• SELLERS: The supply (Active Listings) of Austin homes for sale hit an annual low in November, providing fewer homes for buyers to choose from … and less competition for sellers in the market! This trend is not surprising, and easily predictable. As we note from the historical graph, November and December provide the fewest number of homes on the market, and this year is no different. What IS different is the unusually high number of home sales for the fall. Typically, the falling inventory coincides with the falling sales, and ultimately keeps the average sales price relatively steady. However, this year, we have had the decline in inventory and yet the sales have remained steady. If all homes in Austin were the same and priced equally, then this would trigger an increase in the average sales price. So why did the average sales price drop? The Government. In 2009, our government offered a tax rebate for first time homebuyers (virgins). This, plus the abundance of lower-priced homes skewed the average downward, ultimately lowering the average sales price. Therefore, we have been studying the influx of first-time home buyers in the market. Why are they buying right now?

1. Interest rates - rates remain extremely low and allows otherwise unqualified buyers to purchase homes in this market
2. Prices - prices are extremely affordable and lower than they have been in years
3. Tax credit - the governmental intervention and tax credit has incentivized buyers and made it possible for some buyers to have the necessary cash funds to purchase homes

Are you interested in selling your home right now? With more and more buyers entering the market because of the extended and expanded tax credit, demand continues to increase … and supply is still on the decline. What this means is that there are MORE buyers wanting homes and LESS homes from which to choose (i.e., less competition when selling to even more buyers!).

NOTE: While this is great news for most of our sellers, we must also keep in mind that the overall market is still down over the past few years. So, if you bought your Austin home in the past few years and are selling it today, your home is most likely worth less than what you paid for it - not worth more. That means you will not be selling for a profit but for a loss. To learn more about pricing your home, read Krisstina’s article, “Are You Still Living In A Bubble“.

What Is My Home Worth? Want to get a good idea of what your home is worth … and find out right now online? Check out our Market Snapshot for an analysis of the value of your home.

• BUYERS: Interest rates remain low. Pricing remains affordable. Sellers who have their homes on the market right now are REAL sellers (why else would anyone put their home on the market when the grass is dead, it is 20 degrees outside, and the holidays and new year capture us all?). Are you interested in buying and taking advantage of the Housing V? Take these steps to own the home you are dreaming of:

1. Choose a highly-qualified and accomplished real estate professional: Call 512.892.9473 to learn how to choose your Austin real estate agent
2. Learn about your Buying Power: Call us at 512.892.9473 so we can put you in touch with our mortgage banker, Kristin Carroll.
3. Begin touring homes with your GoodLife agent and choose your new dream home!

“Stop the car, honey … look at that house. I wonder what it’s worth?!?” Does this ever happen to you? Ever wonder what that house is worth? Find out now: What’s That Home Is Worth.

Sales Closed by Month (Demand)

After the blip on the screen for fall 2009, we return to your regularly programmed graph. As we note, the number of sales per month has returned (at least momentarily) to the historical seasonal decline. If our graph and buyers’ behaviors mimick history, December should prove to increase sales a bit over November.

Active Listings (Supply)

Shocking! No, wait. This is completely predictable. Inventory falls as the leaves do. Once all the leaves have stopped falling, so does inventory. What does this mean? If you are thinking of selling in the next 12 months, you may want to consider now as a perfect time to put your home on the market. You will have less competition and more demand for your home … just make sure you get expert help from qualified real estate professionals to design a thorough strategy to get the most amount of money in the least amount of time.

Average Sales Price

It appears that the average sales price has leveled off after a very exciting and turbulant ride earlier in 2009. We continue to hover around $240,000 as an average sales price, and barring any new legistlation, natural disasters, or single-digit temperatures (almost got there in January), prices should remain relatively stable moving into the new year.

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let us know if you would like a neighborhood-specific analysis by emailing us at experience@goodlifeteam.com or calling us at 512.892.9473.

Simple Summary

Want to sell your house more quickly than your competitor?

Get really good help from proven professionals

and

Price your house accordingly.

The data provided to create these graphs are available to you by FREE subscription to our monthly update service.  Please email us experience@goodlifeteam.com to receive your monthly update. Or, catch the wave and follow @GoodLifeTeam on Twitter.