Archive for January, 2012

Home Prices and Affordability – Is Now The Time To Consider Buying A New Home?

Home Prices and Affordability – Is Now The Time To Consider Buying A New Home?

There's been a lot of news over the past several years concerning problems in the housing market, the mortgage industry and the economy. There still a lot of concern about when the market will turn around and start to recover.

I've been saying for the past 6 months or so that we have been in the "Perfect Storm" to buy a home with the combination of low home prices and low interest rates. It seems that the storm is starting to subside. Home prices in many markets are starting to show appreciation.

A recent report on CNBC it was reported that the National Association of Realtors (NAR) Pending Home Index jumped 7.3% in November after jumping after jumping 10.4% in October. (See the news clip below)



A recent issue of "Housing Predictor" has an article titled "Home Affordability Reaches 1971 Level". The article stated "Homes are more affordable to purchase than they have been since 1971 as a result of falling home prices, according to the U.S. 1970s House Department of Housing and Urban Development (HUD). Despite record low mortgage rates, the downward trend in home values is sustained in the majority of the U.S." It went on to say "With interest rates at historically low levels and markets across the country beginning to improve, homeownership is within reach of more households,” said Bob Nielsen, chairman of the National Association of Home Builders."

HSH.com has identified 5 Cities Poised For a Housing Pop. The Washington, DC metropolitan area is included in the list. For the Washington area the site says "A favorite large metro of Fox’s, the Washington, D.C. metro area encompasses two states (Maryland and Virginia) as well as the District of Columbia. With a median home price of $294,800, some experts believe home prices may drop by a percentage point or two in 2011. Expect small price gains--a percentage point or two--in 2012. Key to this metro is that the economy is driven by the federal government, which seems poised for continued growth. Unemployment in the metro is a very low 5.4 percent. The one negative: a cost of living that is well above the national average."

Moneyland.Time.com also looks at the Washington, DC metropolitan area in favorable terms. There recent post "The Real Estate Market that Defies the Trends" said "But in Washington, D.C., housing prices are up a smidgen (0.3%) from the previous month. More importantly, year-over-year prices have risen by 1.3%, a continuation of a happy trend in which prices increased by 2.6% from the year before that. When comparing housing markets in America’s big cities, D.C. appears to be having the strongest and steadiest recovery."

In an earlier article Moneyland.Time.com says that "Home Affordability Near Highest Level in 20 Years" The article states "As a result, families earning the median income of $64,200 could afford 72.9% of the homes sold in the third quarter. (Another reason I like this statistic is that it’s calculated using actual sales prices of new and existing homes, not list prices). That 72.9% is in real contrast with the way things looked five years ago during the boom, when the number dipped to 40.4%. Housing market bulls read the current high affordability number as a sign that there is buying power to bring the real estate market out of its slump, at least at current prices."

Last June Kiplinger.com wrote an article titled "Who Benefits From Affordable Homes?" The article stated "For many young adults, I believe this will turn out to have been a good time to buy a house or condo." It went on to say "But for many young adults who intend to stay put for several years, have good prospects of employment security and can qualify for a plain-vanilla fixed- rate mortgage, I believe this will turn out to have been a good time to buy a house or condo. And if the young home buyers are handy with tools and can find a fixer-upper at a great price, so much the better."

You might find the video Purchasing Power vs. Home Prices interesting:



And rents aren't getting any cheaper. According to USA Today "Apartment Rents Heading Higher for 3rd Year in a Row." According to the article "Apartment rents are expected to jump again this year as the U.S. economy creates more jobs and demand for rental housing grows. A 2012 increase would make the third straight year of rising rents. More annual increases are expected as apartment builders hustle to catch up with demand.

Here's a look at what CNBC.com has to say in a post titled "Renter Nation Rages On As New Reality". "Higher quality properties in the most desirable locations posted rent gains in excess of 5-10 percent, while class B/C properties, catering to lower income tenants, found it relatively more difficult to raise rents,” notes Victor Calanog, head of research at Reis.

Nowhere is that more evident than in the Washington, DC metro area where rents are way up across the city, and developers are rushing to erect new multi-family buildings and rehab old ones."

It went on to say "“Everybody wants to be in DC,” beams Richard Key, district manager for Camden Property Trust, one of the largest publicly traded multifamily REITs in the nation. “Whereas in other markets there are deals, when you get to DC area, all the REITs want to be here, and so we're all competing for the same piece of land, and that's driving the price up. That is really is a challenge for us.”

Key is convinced that there has been a fundamental shift in attitudes toward home ownership that will last for several more years. He is not concerned that the pendulum will swing back to buying, just as all that new rental stock hits the market around 2014. Camden has seen rents on its DC properties rise over 5 percent in just the past year.

So, are you thinking about buying your first home or moving up to a new home and have been waiting to see the bottom? Now may be a good time to jump off the fence and get into the game!


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Your source for VA loan information.

My direct line is 240.813.0614. So let me hear from you! Remember...it doesn't cost a penny to talk...so call right now and I will answer all your questions.


Alan Gross

Senior Mortgage Consultant

PrimeLending, A PlainsCapital Company
704 Quince Orchard Rd., Suite 230
Gaithersburg, MD 20878

Home Office: 240.813.0614
Email: agross@primelending.com
Web: www.mtg-info.net
Web: www.DCMilitaryVALoans.com
NMLS#217388

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Why Are Mortgage Interest Rates Going Up? It’s Not What You Think!

Why Are Mortgage Interest Rates Going Up? It's Not What You Think!

Remember last month when President Obama and Congress were arguing over extending the Payroll Tax Cut?

Did you hear anything in the news about how the Payroll Tax Cut was going to be paid for? Probably not.

Guess where the money to pay for the tax cut is coming from? If you guessed the housing and mortgage industry and specifically people borrowing money through Fannie Mae (Fannie), Freddie Mac (Freddie) and the Federal Housing Administration (FHA) you would be right.

As everyone knows the housing market has been struggling. This new legislation has imposed what is in essence a tax on every borrower who gets a loan that is guaranteed through Fannie, Freddie or FHA.

In an article titled Washington Wades Deeper into Housing Bloomberg Businessweek said that "An 11th-hour extension of the payroll tax cut, signed into law on Dec. 23, will for the first time divert funds from Fannie Mae (FNMA) and Freddie Mac (FMCC), the two mortgage finance companies under U.S. conservatorship, to pay for general government expenses."

The increased costs are also being passed along to borrowers who get FHA loans. OurBroker.com recently published an article "FHA Mortgage Insurance Premium To Rise In 2012"

Here's a recent recent commentary by Brian Stevens and Frank Garay of THINKBIGWORKSMALL:




Effectively, that means that all Conforming loans will increase almost 0.125% in interest rate. With FHA you will see and increase in the Mortgage Insurance Premium (MIP). It could be in the monthly MIP, Upfront MIP or both.

It's been estimated that it will require 10 years of the increase in rates to pay for the two months of benefits provided by this "Payroll Holiday."

So, the temporary decrease in the payroll tax was supposed to help the middle income American taxpayer. Looks to me like the government just dipped there hands in their pockets without telling them. And whens the last time you saw a temporary increase in fees get rescinded. It seems once they get on the books they never go away!

I'd like to know what you think. Please comment below.


Google Me Why Are Mortgage Interest Rates Going Up? Its Not What You Think!


Your source for VA loan information.

My direct line is 240.813.0614. So let me hear from you! Remember...it doesn't cost a penny to talk...so call right now and I will answer all your questions.


Alan Gross

Senior Mortgage Consultant

PrimeLending, A PlainsCapital Company
704 Quince Orchard Rd., Suite 230
Gaithersburg, MD 20878

Home Office: 240.813.0614
Email: agross@primelending.com
Web: www.mtg-info.net
Web: www.DCMilitaryVALoans.com
NMLS#217388

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Have You Heard Of Gube?

Have You Heard Of Gube?

Gube Have You Heard Of Gube? I was reading Facebook earlier today and noticed my friend Johnny Holliday had posted a "Like" to something called Gube. Made me curious so I did a little research.


So what is Gube? It's an iPhone and iPad application that provides parents with a catalog of pre-screened, moderated, and safe yet fun YouTube videos. Designed and developed by parents of toddlers for parents with young children.

There have been several blogs written about Gube. You can find one titled Gube Gives Kids a Safer YouTube on the Hawaii Blog

Here a review done by the Smart Apps For Kids - a Dad's quest to find the best educational apps for the iPad and iPhone.

Lifehaker recently did a review titled Gube Curates Kid-Safe YouTube Videos for iOS

Apple's iTune Preview can be found at Gube By Shacked Software.


What do you think about Gube? I'd appreciate your comments below.



Google Me Have You Heard Of Gube?


Your source for VA loan information.

My direct line is 240.813.0614. So let me hear from you! Remember...it doesn't cost a penny to talk...so call right now and I will answer all your questions.


Alan Gross

Senior Mortgage Consultant

PrimeLending, A PlainsCapital Company
704 Quince Orchard Rd., Suite 230
Gaithersburg, MD 20878

Home Office: 240.813.0614
Email: agross@primelending.com
Web: www.mtg-info.net
Web: www.DCMilitaryVALoans.com
NMLS#217388

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Can A New Monitor Make A Difference? You Bet It Can!

Can A New Monitor Make A Difference? You Bet It Can!

I've upgraded computers over the years but have kept the same 18" NEC MultiSync LCD monitor. I thought about upgrading but never did it.

My daughter Angela who uses the computer from time to time thought it was time for an upgrade so for Christmas she bought me a 23" HP LED monitor. It was easy to install and the difference is unbelievable. It easier to read and looking at pictures and videos is a whole new experience. I can increase the size (Control +) and see and read much easier and not lose content on the edges of the screen. No more squinting at the screen.

A little bit about monitors:
LED and LCD monitors are based on the same basic technology for image display, but differ in the kind of backlighting used. While LCD monitors use cold cathode fluorescent lamps for backlighting, LED monitors use light emitting diodes. This is the prime difference between the two display technologies. So LED monitors are in actuality, a type of LCD monitors, or an improvement over them.

LCD displays have to rely on external lighting, as their display is created through manipulation of light, passing through polarized liquid crystals. The backlighting affects picture quality substantially and light shed by LEDs offers superior picture quality, compared to LCDs.

LED monitors are also a lot softer on the eyes than LCD monitors which make them popular choices for people who work for long hours (I certainly do) on their desktop computers. Their power consumption is as much as 40% less than conventional LCD monitors. They are also a lot more eco-friendly, because mercury is not used in their production. LEDs last longer than cold cathode fluorescent lamps, with little reduction in their power output over time, which makes these monitors long-lasting.

Here's a short video showing some differences between LCDs and LEDs.





So, don't be like me and squint at an old monitor, upgrade, you'll be glad you did!

Google Me Can A New Monitor Make A Difference? You Bet It Can!


Your source for VA loan information.

My direct line is 240.813.0614. So let me hear from you! Remember...it doesn't cost a penny to talk...so call right now and I will answer all your questions.


Alan Gross

Senior Mortgage Consultant

PrimeLending, A PlainsCapital Company
704 Quince Orchard Rd., Suite 230
Gaithersburg, MD 20878

Home Office: 240.813.0614
Email: agross@primelending.com
Web: www.mtg-info.net
Web: www.DCMilitaryVALoans.com
NMLS#217388

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It’s New Year’s. Have You Had Your Coffee Yet?

It's New Year's. Have You Had Your Coffee Yet?

It's New Year's so I thought I'd do a little research on coffee. Thanks to Wikipedia for the information.

Coffee is a brewed beverage with a dark, acidic flavor prepared from the roasted seeds of the coffee plant, colloquially called coffee beans. The beans are found in coffee cherries, which grow on trees cultivated in over 70 countries, primarily in equatorial Latin America, Southeast Asia, South Asia and Africa. Coffee can have a stimulating effect on humans due to its caffeine content. It is one of the most-consumed beverages in the world.

Coffee berries, which contain the coffee seeds or "beans", are produced by several species of small evergreen bush of the genus Coffea. The two most commonly grown are the highly regarded Coffea arabica, and the "robusta" form of the hardier Coffea canephora. The latter is resistant to the devastating coffee leaf rust (Hemileia vastatrix). Once ripe, coffee berries are picked, processed, and dried. The seeds are then roasted to varying degrees, depending on the desired flavor. They are then ground and brewed to create coffee. Coffee can be prepared and presented in a variety of ways.

And now for the video: "Coffee, The Greatest Addiction Ever".





Have a great and prosperous 2012.


Google Me Its New Years. Have You Had Your Coffee Yet?


Your source for VA loan information.

My direct line is 240.813.0614. So let me hear from you! Remember...it doesn't cost a penny to talk...so call right now and I will answer all your questions.


Alan Gross

Senior Mortgage Consultant

PrimeLending, A PlainsCapital Company
704 Quince Orchard Rd., Suite 230
Gaithersburg, MD 20878

Home Office: 240.813.0614
Email: agross@primelending.com
Web: www.mtg-info.net
Web: www.DCMilitaryVALoans.com
NMLS#217388

share save 171 16 Its New Years. Have You Had Your Coffee Yet?