Huntsville Real Estate Blog

2009 was a rough stretch for many Huntsville home sellers and buyers, but new reports hint at possible stabilization in the housing market that may prove beneficial for everyone. As 2009 rolled to a close and 2010 opened into a new year, economic and real estate reports poured out good news, but bad news wasn’t far behind. For each positive note, there is always that unavoidable “but”:

• Mortgage rates are holding steady below 5%, thanks to government intervention. Thanks to the low rates, more people are buying and refinancing. However, the downside is that banks are more reluctant to refinance or loan. This leaves many, who want to buy a Huntsville home, with the inability to do so. Ironic that, in a buyer’s market, it’s the banks with all the selling power.

The other “but” is that the Federal Reserve program providing the low mortgage rates is set to expire in March. Rates could very well double shortly after, which is highly likely to drop the number of interested buyers. A drop in buyer numbers will only further shift the supply/demand ratio.

• As of December 10, 2009, the number of foreclosures in a month had dropped 16%, nationwide. The home buyer tax credit expansion, foreclosure prevention programs and loan modification programs have helped, as well as state mandated financing programs. As great as that is, there were still over 300,000 foreclosures in November, 2009, which is 18% higher than November, 2008.

• Home prices are “firming,” showing improvement over five consecutive months. Although the rise is considered mild, fewer homeowners are underwater, where they owe more mortgage than their house is worth. Because housing prices are improving, home sellers are more confident in the listing prices they’ve set.

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When you first start talking about buying Huntsville homes for sale, you’ll hear “Oh, you should get pre-qualified first,” or “you should get pre-approved first.” So who’s right? What’s the difference between the two?  Is there any difference at all?

Pre-qualified Loans

Before shopping for Huntsville homes for sale, you want to look at lenders. Not all mortgage lenders are created equal. Especially now, with the rocky economic times, you have to be especially careful who you get your mortgage through.  When you find a lender you’re comfortable with, you have two choices: start shopping for houses or get pre-qualified for a loan.

Pre-qualification for a loan is based on the best estimate of the loan officer, not “set-in-stone,” verified facts. The officer believes, because of the information you tell them, that you have good credit and can financially afford a specific loan amount. For this reason, because it isn’t verified, pre-qualification doesn’t hold as much weight with buyers. As well, you could still end up wasting a lot of time looking at houses you can’t afford.

Pre-approved Loans

The second step in getting a mortgage loan is pre-approval. With pre-approval, the lender has received verification that, yes, you are credit worthy and yes, you can afford up to a specific loan amount.

Pre-approval not only gives the seller the idea that you’re a good prospect, but it also helps you out while looking for a home:

• You already know how much home you can afford.

• You already know that you’re qualified to buy any home you look at that falls within your verified loan amount.

• You have better negotiating power with the seller (who may be more willing to accept less than list price knowing that you are already pre-approved).

• The closing period can happen faster, narrowing the typical 30-day period to less than three weeks.

In short, when looking at Huntsville homes for sale, it’s better to be pre-approved, but you can’t get pre-approved for a mortgage without being pre-qualified.  So do yourself (and your new home) a favor and do both.

Need help selecting a mortgage lender?  I can help. Call me at800-803-0053, 256-508-0211 or email me at mike@movetohuntsville.com for more information.

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Most articles across the Net that focus on finding a real estate agent tell you what to look for to find a good one. What if you already have one, though? How can you tell if your Huntsville real estate agent is the one that caused previous clients X, Y and Z to have never-ending nightmares? What if they’re related to the Wicked Witch of the West and, horror of horrors, you don’t know?

It’s enough to give a person the terrors, even though Halloween is already past. In the interest of helping you have a good experience (thus raising the reputation of agents everywhere), here are three things you can do if your Huntsville real estate agent starts giving you the heebie jeebies:

1.  Find out if they’ve had any training since real estate school. Although it depends on the state, most agents have to complete a three- to six-week period of schooling. If they pass the real estate licensing exam they find a broker, sign a form, sign up with some real estate associations and are immediately moved into the echelons of “real estate professional.” That’s it.

If your agent hasn’t had any more training than that, there’s a high probability they don’t know everything they need to know to give you the professional help you need. Real estate school can only teach so much, especially in three to six weeks.

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Home sales surged in the fourth quarter of 2009 with many areas seeing double digit gains according to the National Association of Realtors. Total existing-home sales (single-family and condo) jumped 13.9 percent above the third quarter and 27.2 percent above the fourth quarter of 2008. Distressed property sales accounted for 32 percent of the fourth quarter transactions, down from 37 percent from 2008.

Lawrence Yun , NAR chief economist, said the first-time home buyer tax credit, combined with record low interest rates, played a dominant role in fourth quarter sales. Yun went on to say, “With inventory levels trending down over the past 18 months, we expect broadly balanced housing market conditions in much of the country by late spring with more areas showing higher prices.”

Take a look at how Huntsville real estate sales statistics in January 2010 compared to January 2009.

Madison County/Huntsville Real Estate Sales Statistics

Huntsville and Madison County saw a decrease of 14% in sold listings when compared to January 2009.  The average sales price decreased by 7% to $189,639.  The average price per square foot decreased by 1% when compared with January 2009.  And the average list price decreased by 7%, while homes were on the market an average of 12 days less than January 2009.

For more information about Huntsville real estate, please visit MoveToHuntsville.com or call me at 256-508-0211.

To begin searching Huntsville real estate and homes, please use my complimentary MLS search.

Statistics are based on information for the North Alabama Association of Realtors and are deemed reliable but not guaranteed

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Real estate aficionados who follow the upswings and dips in the Huntsville real estate market were worried that the end of the first-time home buyer’s credit would mean an end to housing sales. Sales were up, prices were down and the market seemed to be stabilizing – thanks, in large part, to the tax credit.  The tax credit motivated potential home buyers to become actual home buyers, which kept home sales stable.

Fortunately, those worries were groundless.  President Obama signed a five-month extension on the first-time buyer tax credit November 6^th. The Worker, Homeownership and Business Assistance Act of 2009 covers quite a few new bits of housing legislation:

• Extends the first-time tax credit until April 30, 2010
• Expands to include those home buyers that haven’t owned a home in three or more years
• Allows first-time buyers that are overseas military personnel to take advantage of the credit until May 2011
• Requires documented proof that the buyer actually bought a home
• Changes the credit amount from $8,000 to “$8,000 or 10% of the home’s value”, whichever is less
• Sets the qualification guidelines at $125,000 a year or less for individuals and $225,000 or less for couples (credit amount becomes a scaled decrease above these income levels)
• Requires a minimum age of 18 for those applying for the tax credit
• Adds $6,500 tax credit for those that have lived in a home for at least five years, but want to buy a larger house
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People have asked me about FSBO (For Sale By Owner).  They want to know whether it’s a good idea to use an agent and the answers to many other questions on this topic. I admit it; I’m biased. I am, after all, a Huntsville real estate agent. 

I’ll even go a bit farther and admit that I’m biased about my hometown. As far as I’m concerned, if you’re going to buy a house, you should use me as your agent and buy a house in Huntsville. But then, that’s what most real estate agents will tell you. 

Without the bias, however, there are some real issues with not using a Huntsville real estate agent (or any agent, anywhere, for that matter).  And, there’s one BIG issue… 

The Contract!

Okay, here’s the deal. A real estate contract, like any contract, is a sealed deal once the papers are signed. It’s legally binding and will be upheld in any court of law in the country, with few (and rare) exceptions. 

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There are a lot of financing options to help you buy Huntsville real estate, if you can meet the credit guidelines.  

Most lenders prefer to use 30-year mortgage loans.  With a longer loan term, the lender can collect more money in interest over the life of the loan.  For those who are credit-worthy, a 15-year mortgage term may be offered.  So, what is the difference between the two?  Here are a few guidelines: 

What About a 30-Year Mortgage?

Thirty-year mortgages are becoming the normal term for Huntsville real estate loans.  The payments are usually more affordable and lenders are quick to recommend them.  Lenders are more likely to offer you a higher loan amount with a 30-year loan, but the trade off is usually a higher interest rate.  

What Are The Benefits Of A 15-Year Mortgage?

Signing up for a 15-year mortgage can save you a lot of money in interest payments.  True, your monthly payments will be higher than with a 30-year loan, but the impact on your long-term finances may be worth it. 

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If you’re looking at homes for sale in Huntsville, want to buy a home and are waiting around for better prices, you might want to rethink your strategy. 

If you’re a market watcher, soaking up the information overload across news media and Internet websites, you’re probably overwhelmed with confusion by now. Is the housing market getting better? Is it getting worse? Was there really, when it gets down to it, a housing bubble collapse? And, if so, who popped it? 

First, the quick answers. Yes, the housing bubble collapsed, and everybody had a hand in popping it: the government, the lenders, the investors and the general public. Now the hard answers: it’s getting better – and worse. 

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Working to have a safe Huntsville home environment is important to everyone.  We want our children to have safe water, clean air, fresh food and a healthy earth for their future.

One area where you might consider decreasing your impact on the environment is in your own home construction.  There are several ways you can have a safe and clean green home construction.

• Find a “green” builder to help with your Huntsville home.  Search the Internet for professional green builders.  It takes a special contractor to coordinate the elements of home building to ensure maximum energy savings.  Buying green materials is just one step toward having a green home.  To achieve ultimate efficiency, the different structural parts of plumbing, electricity, gas lines, and framework need to be coordinated.
• Buy green materials from different vendors.  Shop around to ensure you are getting the best deal.  One vendor may sell stone at an exceptional price, but his timber may be overpriced.  Natural supplies can be in short availability in some areas.  Natural builders and vendors are working together to build a greener home construction industry, but it is still a business.  It is your responsibility as the homeowner to make sure that you are getting the best deal.
• Continue the “green” theme with your home decorations and furnishings.  The construction of your green home saves resources and energy.  You can reduce your impact on the environment even further by using energy saving appliances, eco-friendly interior paint, and sustainable wood flooring in your home.

Building your Huntsville home using green construction is a great start to a cleaner, brighter future. 

I can help you learn more about green home construction options.  Call me at 800-803-0053, 256-508-0211 or email me at mike@movetohuntsville.com for more information.

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Have you heard of the first-time homebuyer’s tax credit extension? Last month, President Obama signed the extension to help first-time homebuyers (who didn’t get their sales in by November 30th) buy a house that meets their needs. What about those who already own Huntsville homes, are doing well and want a larger home? 

To those who already own a home, Merry Christmas! The Workers, Homeownership and Business Assistance Act of 2009 didn’t just come with an extension; it came with improvements. Those in governmental positions of authority reasoned that if someone wanted to get a bigger home, they should get some kind of help too, thus further helping the overall real estate market. 

If you own a home, you can now receive up to $6,500 in tax credits for buying one of the Huntsville homes for sale. The actual wording is “$6,500 or 10%.” Here are a few of the important points you need to know: 

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