Home Valuation Code of Conduct (HVCC) to be Eliminated

The Home Valuation Code of Conduct (HVCC) will be eliminated, thanks to a bill signed into law by President Obama.

HVCC was enacted in 2009, and has been a big issue in the appraisal battle many home sales have been experiencing.

In June last year, Tasha Linton and I wrote about how HVCC Could Negatively Affect Towson Home Values , because the appraisers assigned are the lowest cost one available, not necessarily from the area. Real estate is very local — for example, Towson neighborhoods are very unique — sometimes even street-by-street! An appraiser from outside of Washington, DC will not understand the neighborhood nuances, and this could tremendously effect an appraisal value.

The HVCC going away is a huge relief to many in the real estate community, and homeowners should be very pleased as well.

HVCC will be phased out over the next 90 days, with the end of October closing this sad chapter in real estate housing history.

Mortgage Rates Drop Very Low

Mortgage rates drop very low — below 5% — as international money comes into the United States. The US bonds are seen as a safe haven in light of the financial troubles in Europe, and this is having a nice result in our country.

The Wall Street Journal reported this morning that interest rates were quoted at 4.86% on Friday. According to the Journal:

Falling mortgage rates can give a powerful lift to the housing market. A general rule of thumb holds that every one percentage point decline in mortgage rates effectively lowers home prices for buyers by roughly 10%. So, if the current rates hold, say economists, that could help stabilize prices and allow current homeowners to sell existing homes without substantial price cuts.

This is great news for the Towson real estate market because lower interest rates usually mean more houses selling.

There was concern that interest rates would rise above 6% as the Federal Reserve’s mortgage securities program is coming to an end. Add onto that the end of the Homebuyer Tax Credit, and the real estate market looked bleak for the summer.

Now, with the interest rates being so low, it can make homes much more affordable for many buyers.

It makes this truly a fantastic time to buy with interest rates at historic lows and housing prices so low as well. Contact me to take advantage of these low interest rates and get into your new Baltimore home!

Housing Prices Expected to Rise 3-5% in 2010

A recent statement by John Paulson of Paulson & Co, Inc. shows that housing prices are expected to rise 3-5% in 2010.

CNBC published an article with quotes from the group’s owner, who tracks home prices in California, and notes that what happens in the state tends to trend about six months later in the rest of the country’s housing markets.

He also expects prices to rise another 8-12% in 2011.

He stated that home ownership is the most affordable it has been in over 50 years, and that it is 60% more affordable now than at its’ peak.

What does this mean?

For Towson homebuyers, NOW IS THE TIME TO BUY!

21204 Home Sales Statistics February 2010

January and February 2010 has shown some recovery and growth over last year at the same time for Towson home sales.

21204 houses that settled had prices up $24,000. Under contract, however, was down around $106,500 (23%). I attribute much of that drop in February due to the two blizzards. Half as many new listings as last year came on the market (not surprising since they were buried under about 4 1/2 feet of snow), which the National Association of REALTORS® has found across the areas hit by these storms.

21204 home sales have remained strong, though, this year over last year, and have continued to be consistent over time. Though the amounts may rise some months, the graphs show a consistent level of sales and prices.

Here is the full report on median price on market dynamics for the Towson 21204 zip code.

21204 Towson Home Sale Statistics 2009 Year In Review

Reviewing the 21204 zip code sales, contracts and listings for December of ‘08-December of ‘09, there are many interesting variations throughout the year.

The good part for the owners of Towson homes in the $500,000 and higher range, is that finally these seem to be selling! 11 properties in December went under contract with a median price of $500,000. 14 properties settled in the same time period with that same median price.

The graph through the rest of 2009 has shown that houses have been consistently selling, but that the average sales price was under $400,000 (some months by a large amount).

Other good news is that sales and prices are up a tremendous amount over the same time period at the end of 2008, showing that Towson and 21204 seem to be in a recovery & stabilizing mode.

Click here for the full report.

I am excited to see how January’s numbers look, because I have been seeing quite a number of higher priced homes in 21204 going under contract since the beginning of a year. I will update you when those numbers come out!

Update on Questions on Homebuyer Tax Credit for Married Couples

When the Homebuyer Tax Credit was extended to include long-time homeowners buying new houses and getting a $6,500 credit, a whole new group of questions came into play.

Unfortunately for a few clients of mine (and I am sure many others out there), the answers were not what they were hoping.

• One person owns a house that s/he has lived in for 5 out of the last 8 years. S/he got married in 2009, and the partner has never owned a home. Do they qualify for either credit? Unfortunately, according to the IRS, NO. From the IRS site below, the answer:

A. No. Both you and your spouse must be first-time homebuyers in order to qualify for the first-time homebuyer tax credit. Since you had an ownership interest in a principal residence during the three-year period ending on the date of purchase, neither you nor your spouse qualifies for the credit. Similarly, both you and your spouse must be long-time homeowners of the same previous principal residence in order to qualify for the long-time resident homebuyer credit. Since your spouse is not a long-time homeowner of your current principal residence, neither of you qualify for the credit.

 

• A newly married couple each has owned their own personal residences for 5 out of the last 8 years. Do they qualify for the $6,500 credit? Also, unfortunately, NO. They must have owned the SAME residence together for that time period. From the IRS site below:

A. No. Both spouses must have owned and used the same previous principal residence for five consecutive years out of the eight-year period ending on the date of purchase of the new principal residence to be eligible for the credit. Since you and your spouse owned and used different principal residences, neither of you qualify.

If these couples were unmarried, and co-buying a new house, they would qualify.

For people who are planning to buy something in 2010 and were counting on that tax credit, this is not very helpful. That being said, if you have a house to SELL, you need to keep in mind that the buyers of the house you are SELLING may still qualify, so you should try to sell while people will still be buying.

Many times sellers forget how these credits may impact the sale of their home, because they are only indirectly affected. My thoughts are that if you are considering selling your Baltimore or Towson home in 2010, get the sale in BEFORE the credit runs out. With the number of days on the market averaging 60-180 in some areas of Baltimore and Towson, then that means getting your home ready to sell NOW!

Happy New Year 2010 Towson Real Estate Market Thoughts

As I sit here and reflect on 2009 and enjoy the beginning of 2010, I am reminded at what a new year can bring.

There is always a sense of excitement — that a new year can mean great things.

What will happen in the Towson real estate market? Will it rise? Will it fall? Will it stay at its’ teetering stabilization point that it has been in? I think we will remain about where we are — I don’t foresee a jump, but I think our neighborhoods are strong and prices will remain strong.

What about the real estate market in general? A few economists, like the National Association of REALTORS (R) economist, think there will be about a 10% increase.

I tend to be cautious in my optimism, and think we still have a large number of short sales and foreclosures coming down the pike in 2010, which will drop values lower, or keep them at the lower prices we are seeing now. I truly don’t foresee a real true recovery until 2012.

What does this mean for Towson sellers? That your homes are still worth a great amount because our area has been stabilized. That being said, they are not worth what they were even two years ago, so you can’t think about those prices when considering selling your home.

What does this mean for Towson homebuyers? BUY! It is a GREAT time! Interest rates are still very low, and prices are much lower than they have been in years.

For a true value estimation of a Towson home as a homebuyer or seller, or to find if this is the right time for you to move, please contact me – I am happy to help!

New Maryland Property Tax Assessments to Average 19.7% Lower Value — What This Means for Towson Homes

The new tax assessments for the State of Maryland are due to come out in the upcoming days, and the state’s assessment office says it will show an unusual thing — a drop of an average of 19.7% in value since 2005-6, the last time many of these homes were assessed.

What does this mean for Towson Homeowners?

Not much, unfortunately.

Your taxes will not be lowered, as Maryland still needs your money.

Also, the way assessments are structured, even if your value had jumped UP tremendously, the taxes would only rise a capped amount. The 19.7% drop does not lower the value enough to restructure your property’s tax rate. In most cases, unless you bought your home in the last two years, your taxes will still rise.

Larry Carson of the Baltimore Sun wrote a very detailed article explaining the drop in values but not in taxes owed.

Towson has not dropped in value as dramatically as some areas, so I do not expect to see that percentage here. I will be curious to see what Maryland now has my Towson home assessed to be versus its true market value.

Tax assessments are not actual market values of a home, so be aware of this. If you would like a true market value range for your Towson home, please contact me, and I will be happy to give you an approximation of market value!

Loch Raven Village and Knettishall in Towson Gems in Baltimore Sun Article

A few month back, I received a phone call from Jamie Smith Hopkins of the Baltimore Sun because she knew I know Towson real estate very well, and had sold homes in Loch Raven Village and Knettishall.

Jamie was putting together a series of articles called “Hidden Gems” about areas in Baltimore County and City that were in high demand areas — but not high demand prices.

Part of the criteria was that the median sales price had to be under the “affordable housing” line of $250,000. The buyer’s market of today has put Loch Raven Village and Knettishall in that range.

I was quoted a few times in the article, (thank you Jamie!), and I think she got a great feel for the neighborhood from a few different perspectives. Please read Jamie Smith Hopkins’ Baltimore Sun article about this Hidden Gem of an area!

There are many things that I love about Loch Raven Village and Knettishall. The homes are brick, well built, and generally beautiful. The streets are lined with trees and are so inviting. Its location in Towson and Parkville is convenient for both driving and public transportation. Shops are close by — the newly refurbished Towson Place, the nearby redone Towson Town Center, the Loch Raven Boulevard shops…it is all right there.

I recently sold one in the neighborhood on Aberdeen Road on the eastern side of Loch Raven Boulevard in Parkville. I know the neighborhood well. If you have any questions or would like to sell your Loch Raven Village home or buy one and take advantage of the $8,000 tax credit or $6,500 tax credit, please contact me today. I would love to help!

21204 Home Sale Statistics Past Six Months

My compilation of the 21204 real estate market statistics for the last six months are here!  The full chart includes data on sales, contract, and active homes from May 25-November 8, 2009.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What this shows is that the lower priced Towson homes are the ones that are selling best. The first week in June the median sales price was over $1M, but since then, it has been generally under $500,000.  West Towson house values are continuing to be strong, while the higher priced areas of the 21204 real estate market, such as Ruxton home sales, are not as solid.

Another interesting spike is the “under contract price” for the second and third weeks in August, but even more notable is the lack of corresponding “settled price” spikes, suggesting those homes did not go for their asking prices.

Consistently, there have been over 80 homes for sale in 21204, while on average only 2-3 of those homes are going under contract each month, and only 2-3 are settling each month.  There is definitely a large inventory for Towson homebuyers, with an average of only 3.75% of listed homes going under contract each month.

These 21204 home sale statistics show that pricing correctly, having the home in showplace condition, and good marketing are imperative in this Towson housing market.

Please note that these are statistics from the multiple list. The chart is an overview of the zip code and does not take into account the type (condo, townhouse, single family) or condition of the home. To have a true value understanding of your Towson home or neighborhood, these factors need to be taken into consideration. If you would like a Towson home price evaluation, please contact me today.

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