Are Foreclosures Increasing or Decreasing?

by The KCM Crew on December 19, 2012 ·

 

 

Recent headlines have created tremendous confusion regarding the foreclosure situation in the country. Let’s give an example. Which of these two headlines are accurate?

 

Foreclosure Starts Plunge to 71-Month Low
Foreclosures Increase for the First Time Since 2010

The challenge is that both headlines are 100% accurate. How can foreclosures have increased for the first time in two years and, at the same time, be at a six year low? Each headline was reporting on a different measurement. Below are the explanations for each of the measurements as per RealtyTrac’s most recent Mortgage Foreclosure Report.

Foreclosure Starts

Foreclosure starts are the first steps taken by the bank after the borrower becomes delinquent on their mortgage payments (default notices or scheduled foreclosure auctions, depending on the state). They were filed for the first time on 77,494 U.S. properties in November. This was:

• Down 13% from the previous month
• Down 28% from November 2011
• At the lowest level since December 2006

Foreclosures (Bank Repossessions)

This is when the lender completes the foreclosure process and repossesses the property. This occurred on 59,134 U.S. properties in November. This was:

• An 11 percent increase from the previous month
• A 5% increase from November 2011
• The first year-over-year increase in bank repossessions since October 2010, when the practice of robo-signing foreclosure documents came to light and caused a sharp slowdown in foreclosure activity in the following months

In the report, Daren Blomquist, vice president at RealtyTrac, explained:

“The drop in overall foreclosure activity in November was caused largely by a 71-month low in foreclosure starts for the month, more evidence that we are past the worst of the foreclosure problem brought about by the housing bubble bursting six years ago. But foreclosures are continuing to hobble the U.S. housing market as lenders finally seize properties that started the process a year or two ago — and much longer in some cases.”

We hope this brings some clarity to the situation.

If you are thinking of buying a home in or around Bristol County MA or RI, please visit www.DistinctiveHomes-NE.comfor a free list of homes for sale in Westport MA and surrounding towns.

Would you like to receive a current market update of your specfic area? Contact me with your request.

If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!

Noemi Cardoso

Local Office. Local Agents. Local Knowledge.

William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com

Homeownership as an Investment

Posted: 12 Dec 2012 04:00 AM - KCM Team

In Real Estate: Today’s Golden Opportunity we compared the current housing market to the market for gold about a decade ago. Some commented on the fact that you can’t compare gold to real estate as an investment as gold is a very liquid asset and it would take more time and effort to sell a house. We were not trying to make the case for real estate vs. gold as an investment in our blog. We were just showing that all investments go through cycles and that the best time to buy any investment may be when everyone is saying not to.

However, since the subject of comparing real estate to other investments has come up, let’s take a closer look. There are two major advantages to investing in a home of your own rather than another option:

You Can’t Live in Your IRA

When you buy your own home you are not taking available dollars away from another investment. You are replacing one housing expense (rent) which has no potential for a return on investment with another (mortgage payment) that does give you an opportunity for a return. We realize that there has been research showing that over the last 30 years renting has been less expensive than owning. That research also says that if you invested the entire difference between the rent payment and mortgage payment you may have done better financially. There are two challenges with this conclusion:

1. Today, in the vast majority of the country, renting is actually more expensive than owning a home.
2. History has proven that tenants DO NOT invest the difference in their rent and mortgage payments.

Today,studies show that owning a home is no more expensive than renting a home. However, even if this wasn’t the case, history shows that owning a home creates greater wealth.

Paying a mortgage creates what financial experts call ‘forced savings’. The Joint Center for Housing Studies at Harvard University released a study last year titled America’s Rental Housing: Meeting Challenges, Building on Opportunities. In the study, they actually quantified the difference in family wealth between renters and homeowners:

“Renters have only a fraction of the net wealth of owners. Near the peak of the housing bubble in 2007, the median net wealth of homeowners was $234,600—about 46 times the $5,100 median for renters. Even if homeowner wealth fell back to 1995 levels, it would still be 27.5 times the median for renters.”

There Are Tremendous Tax Advantages to Investing in a Home

There is no doubt that selling an investment such as gold is easier than selling your home. However, this liquidity comes at a price. The price is called capital gains. That is the tax you pay on any financial gain you receive from the investment. This tax doesn’t apply the same way when you sell your primary residence:

Theresa Palagonia, a CPA and the Accounting Manager for the firm G.S. Garritano & Associates, was good enough to explain the Home Sale Exclusion Rules:

“You may qualify to exclude from your income all or part of any gain from the sale of your main home. Maximum Exclusion You can exclude up to $250,000 of the gain on the sale of your main home if all of the following are true:

• You meet the ownership test.
• You meet the use test.
• During the 2 year period ending on the date of the sale, you did not exclude gain from the sale of another home.

If you and another person owned the home jointly but file separate returns, each of you can exclude up to $250,000 of gain from the sale of your interest in the home if each of you meets the three conditions listed above.

You may be able to exclude up to $500,000 of the gain on the sale of your main home if you are married and file a joint return and meet the requirements. (Special rules apply for joint returns.)

Ownership and Use Tests

During the 5 year period ending on the date of the sale, you must have:

• Owned the home for at least 2 years, and
• Lived in the home as your main home for at least 2 years

Certain exceptions exist in which you may qualify for the exclusion without satisfying the tests listed.”

Bottom Line

Every investment has pros and cons. That is why there is such an assortment of great opportunities. Real Estate has been, is and always will be one of those opportunities.

If you are thinking of buying a home in or around Bristol County MA or RI, please visit www.DistinctiveHomes-NE.comfor a free list of homes for sale in Westport MA and surrounding towns.

Would you like to receive a current market update of your specfic area? Contact me with your request.

If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!

Noemi Cardoso

Local Office. Local Agents. Local Knowledge.

William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com

 

Was 2012 a Better Year for Real Estate Than 2011?

by The KCM Crew on December 11, 2012

There are still those questioning whether the housing market is truly making a comeback. We have decided to graph home sales over the last two years based on the National Association of Realtor‘s Pending Home Sales Report. We believe the graph removes all doubt.

The methodology for the report as per NAR:

“The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales; it coincides with a level that is historically healthy.”

If you are thinking of buying a home in or around Bristol County MA or RI, please visit www.DistinctiveHomes-NE.comfor a free list of homes for sale in Westport MA and surrounding towns.

Would you like to receive a current market update of your specfic area? Contact me with your request.

If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!

Noemi Cardoso

Local Office. Local Agents. Local Knowledge.

William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com

Westport Ma Real Estate & Homes for sale in Westport

- November 2012 -

Westport MA real estate sales remains stable. In November there were 19 homes sold in Westport compared to October  when 8 homes Sold in Westport.

SOLD HOMES:  The lowest priced house in Westport in the month of November sold for $117,000 which was a Ranch on South Berryman St and it was a Estate Sale. St. In October  the lowest priced home sold for $60,000.

The Highest priced home in Westport in the month of November sold for $1,270,000 which was a Waterfront Cape on Drift Rd with views of the Westport River. Compared to October sold for $699,000 which was a ranch on Costa Lane. One Sales was a foreclosure on Pine Hill for $155,000. There were no Condos nor Multi Families homes sold in October.

UNDER AGREEEMNT: There were 11 single family homes Under Agreement with prices varying from $135,000 to $995,000 as of November 30th.

ACTIVE LISTINGS: There are currently 101 Active listing in Westport (based on MLSPIN MA) with prices varying from $165,000  on Beechwood St up to $2,595,000 on River Road. Six units are condominiums with prices between $167,500 and $439,000, and 8 are multi families with prices from $349,000 up to $699,000. There are currently 2 Foreclosure available for sale in Westport and 1 Short Sale.

Home Sold in Westport MA - 2012 Average Prices

Average Price	January	February	March	April	May	June
List price p/SqFt	$162	$193	$182	$201	$209	$306
List Price	$345,414	$228,967	$452,670	$530,515	$370,971	$658,835
Sales Price	$329,271	$212,333	$395,740	$491,795	$331,600	$542,358
Sale price p/ SqFt	$155	$178	$171	$189	$190	$209
Days on the Market	169 days	309 days	120 days	195 days	149 days	222 days

 

Average Price	July	August	September	October	November	December
List price p/SqFt	$173	$211	$207	$151	$208
List Price	$346,535	$480,783	$328,733	$345,338	$404,532
Sales Price	$339,723	$417,150	$316,000	$327,188	$381,626
Sale price p/ SqFt	$171	$189	$202	$147	$195
Days on the Market	254 days	217 days	164 days	96 days	143 days

If you are thinking of buying a home please visit www.DistinctiveHomes-NE.com for a free list of homes for sale in Westport MA and surrounding towns. Would like to receive a current market update of your specfic area? Contact me with your request.

If you are thinking of selling your home contact me for a FREE Current Market Analysis and to learn about our Market Plan to get your home SOLD!

We work with one going in mind, YOURS!

Noemi Cardoso

Local Office. Local Agents. Local Knowledge.

William Raveis Real Estate
911 Main Rd - Westport MA 02790
Cell: 508-558-1945
www.DistinctiveHomes-NE.com
noemi@DistinctiveHomes-NE.com