Real Estate Information Archive

Homes and condo sales continued at a brisk pace for May, 2010 in Anderson and Newtown.  48 homes closed in the month of May.  There are currently 73 homes pending closing and 464 homes and condos that are actively listed for sale. 

Troubling issues raised by the above graph show that we are still not back to the average prices of homes and condos sold in 2005.  This is causing difficulties for people wanting to refinance in this time of extremely low mortgage rates.  It is also a problem for those with little equity in their home, who need to sell because of a relocation or change in family circumstances.

According to Credit Suisse's monthly survey, traffic levels (number of visitors to homes for sale) have been slower in May.  This is caused by the end of the homebuyer tax credit.  It forced many buyers to buy ahead of what might have been their regular time schedule. Low traffic levels may result in a longer time to sell a house and price reductions.

The Cincinnati Multiple Listing Service reported an overall uptick of 25% from May of 2009 to May of 2010 on the number of homes sold in the region.  That is more than the 19% reported for nationwide home sales.  June sales are expected to also remain strong as the last of the tax credit homebuyers close on their homes.

Despite all the dire economic news, there is currently, staring us in the face, a 24-karat gold real estate opportunity that can give your child financial stability. Anyone that takes advantage of this opportunity in Cincinnati Real Estate will look back and thank their lucky stars (probably sooner than they think)

There are three reasons that point directly to the stars being lined up perfectly:

1. Cheaper properties (prices being driven down by foreclosures)
2. Low fixed rates on old fashioned 30 year mortgages
3. FHA financing

Here is the strategy:

1. Gift your child the minimum down payment (3.5% of selling price).
2. ASK the seller to pay the closing costs in your offer, so your child needs NO cash at all.
3. SNAG a cheap property in the best location your kid can afford.
4. Allow your child to claim the $8000 tax credit on their income taxes.

Be prepared for this:

1. Multiple offers on lender foreclosed properties for sale.
2. Sellers insisting on an approval with a lender (not just a letter from the mortgage person).
3. A longer time-line than you are expecting for the property to close.

10 things not to worry about:

1. Rates will go lower.  FHA loans have the ability to be easily rewritten if rates drop (streamlined refinancing).
2. Real estate will be cheaper. It’s OK…Think long term.
3. Your kid isn’t "ready." Most first time buyers do not have the perspective to understand the benefit of the tax credit, or the silver lining of economic downturns.
4. Going on the loan with your child.
5. Finding the "perfect" house/condo. It is a starter house, for crying out loud. Do not expect lender foreclosures to be pretty.
6. FHA closing costs are "too high". Yes, FHA will have slightly higher closing costs than conventional. Seller may not pay closing costs. You can gift your child closing costs, too.
7. What if my child loses his job?  "What ifs" are the biggest reasons for missed opportunities!
8. The real estate market is just too confusing. That is why you should find a great real estate agent like us at The Cincinnati Team!
9. Getting a loan is a big hassle! Get preapproved with a great mortgage person before you even start looking for property.
10.  Where will I get the cash to help my kid? How about an equity line or a retirement account?

Get your child set and maybe you could move in with him someday! J