Economists Predict Growth in 2011

Economists predict growth in 2011, according to an article in the Washington Post on New Year’s Eve.

One of the factors used was that the National Association of REALTORS(R) (NAR) stated that pending home sales were up 3.5%, showing that more buyers are moving into the real estate marketplace, and a sense of confidence about future home prices rising.

The Washington Post article by Neil Irwin also states that many consumers are paying down their debt, and lenders are loosening their credit availability, also adding to the ability of potential homeowners to buy houses. They do think that residential housing still won’t be a huge factor in the growth, saying,

Few forecasters are expecting major improvement in the housing sector, which has been a drag on the economy for four straight years. But neither does housing appear set to be a major drain on growth. Residential investment constituted its lowest proportion of overall economic activity on record in the third quarter, meaning that even if it were to contract a bit, it would have little impact on growth.

There also is a glut of houses in foreclosure, waiting to be released for sale. Banks have estimated these to be in the millions. This year, we do not expect to see housing prices rise in the spring as in the past, as I discussed in my post,”Will My Timonium House Be Worth More in the Spring?”

So what does this mean?

It means we it appears we are in the beginning of recovery in our recession. This takes time.

It also means that sellers need to be aware that low prices are what are driving buyers into the real estate market. To sell your Baltimore County home, you need to be priced aggressively and show beautifully.

For more information on your Baltimore County neighborhood, contact me. I am happy to help!

Ally Financial Foreclosure Issues

After a number of lawsuits have been filed, Ally Financial (formerly GMAC), one of the US’s largest banks, is halting foreclosures in 23 states.

Maryland is NOT one of the states.

JP Morgan Chase has also been wracked with issues,with an employee coming forward, stating that she signed off on thousands of foreclosures without verifying the accuracy of the information in the file.

Another employee of a document services company admitted to signing foreclosure affidavits, claiming to be executives and other people when signing. Her signature also has supposedly been forged. These are on thousands of foreclosure documents. There has been a lawsuit filed against the company owned by Lender Processing Services, which is supposed to help speed up the foreclosure process for banks.

The Washington Post reported on this mess in an article last week. This week, title companies are battening down the hatches, attempting to prepare for future transactions, ensuring that substitute trustees and appointees match completely.

Right now, none of the current cases are in Maryland. Hopefully it will remain that way.

Real Estate Tax in Heathcare Bill

There is a real estate tax in the Heathcare Bill, called the Medicare Tax, because the benefits go to Medicare.

Many are up in arms over the 3.8% tax that would have to be paid.

Luckily for most Americans, this tax DOES NOT APPLY.

From Factcheck.org:

…only those with incomes over $200,000 a year ($250,000 for married couples filing jointly) will be subject to it. And even for those who have such high incomes, the tax still won’t apply to the first $250,000 on profits from the sale of a personal residence — or to the first $500,000 in the case of a married couple selling their home.

If you are married, you would only pay on PROFITS over $500,000 on your personal house that you sell. And that’s only IF you make $250,000 or more each year in income. Right now, you already can’t be taxed on your primary residence for this amount, and that remains true.

Washington Post columnist Benny L Kass, who also happens to be an attorney, reiterated much of the same information in his recent post:

First, it is not a sales tax, nor does it impose any transfer or recordation tax. It is called a Medicare tax because the money received will be allocated to the Medicare Trust Fund, which is part of the Social Security system.

So, please don’t worry. The Health Care and Education Reconciliation Act of 2010′s “real estate tax” will not effect most Americans. Those who will be are in the top 2% of income earners in the US, and won’t be affected until 2013.

Emergent BioSolutions Jobs in Baltimore

Emergent BioSolutions will have 120 new jobs in Baltimore in the next few years.

The company, based in Rockville, had a ribbon cutting ceremony on their 56,000 square foot facility on Lombard Street in Downtown Baltimore on Friday.

Emergent is the maker of the only FDA approved anthrax vaccine. The Washington Post reports that they are hoping that this location near Johns Hopkins Bayview will help them get into more commercial biotechnology and pharmaceuticals.

This is great for Baltimore residents because there will be more job opportunities opening in the area, which could also help the Baltimore real estate market, especially Canton house values, since it is so close by and right on public transportation routes!