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The 30-year, fixed-rate mortgage rate fell to 4.6% in the most recent Freddie Mac Primary Mortgage Market Survey, reaching a new low for 2011.
That compares to a rate of 4.61% a week earlier and 4.84% last year. The 15-year, FRM followed suit, averaging 3.78%, down from 3.8% a week earlier and 4.21% last year.
The 5-year, Treasury-indexed hybrid adjustable-rate mortgage averaged 3.41%, down from a week earlier when it averaged 3.48% and down from 3.97% last year.
Meanwhile, the 1-year, Treasury-indexed ARM averaged 3.11% in the most recent week, down from a week earlier when it averaged 3.15%
“Fixed mortgage rates eased slightly for the sixth consecutive week amid reports of slower economic activity," concluded Frank Nothaft, vice president and chief economist, Freddie Mac.
RE/MAX ACCORD 3390 Mt. Diablo Blvd.Lafayette, CA 94549
Mothers share laughter, tears, joy and disappointments
Because they’re always there when you need them –they hold a special place in our hearts
Wishing all Mothers peace, love and happiness on this celebrated day!
Janie Gervasi
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TIME TO BUY: The cover story in the April edition of Fortune magazine trumpets that "housing is back."
"After four years of plunging home prices, the most attractive asset class in America is housing," proclaims Fortune magazine, one of the world's premier business publications, in its April cover story.
The article, headlined "The Return of Real Estate," explains that several market forces have created a more promising outlook for the industry. An excerpt:
So let's state it simply and forcibly: Housing is back. Two basic factors are laying the foundation for dramatic recovery in residential real estate. The first is the historic drop in new construction. The second is a steep decline in prices, on the order of 30% nationwide since 2006, and as much as 55% in the hardest-hit markets. The story of this downturn has been an astonishing flight from the traditional American approach of buying new houses to an embrace of renting. But the new affordability will gradually lure Americans back to buying homes. And the return of the homeowner will start raising prices in many markets this year.
The author, Senior Editor-at-Large Shawn Tully, acknowledges that demand has been extremely weak in recent years, but notes that a "remarkable shift in home affordability" and the cost of owning vs. renting bode well for housing's immediate future.
The second measure, the cost of owning compared with renting, should also inspire potential buyers. In 28 out of 54 major markets, it's now cheaper to pay a mortgage and other major costs than to rent the same house. What's most compelling is that in all of the distressed markets, owning now wins by a wide margin -- a stunning reversal from four years ago. It now costs 34% less than renting in Atlanta. In Miami the average rent is now $1,031 a month, vs. the $856 it costs to carry a ranch house or stucco cottage as an owner.
Some cities, especially those not immersed in foreclosures, will rebound sooner than others, Tully writes, but even the hardest-hit markets have reason for some level of optimism. One big reason: Investors.
"People always want to live in those sunny locales, and their job markets are starting to recover, albeit slowly. In foreclosure markets, the inventory problem is far greater because it includes not just traditional resale homes but millions of distressed properties. Fortunately those houses are now such a screaming deal that investors, including lots of mom-and-pop buyers, are purchasing them at a rapid pace."
The bottom line, Tully concludes, is that it's a great time to buy. His article's final advice for those on the fence:
If you're like most first-time home buyers, you've probably listened to friends', family's and coworkers' advice, many of whom are encouraging you to buy a home. However, you may still wonder if buying a home is the right thing to do. Relax. Having reservations is normal. The more you know about why you should buy a home, the less scary the entire process will appear to you. Here are eight good reasons why you should buy a home.
Pride of Ownership
Pride of ownership is the number one reason why people yearn to own their home. It means you can paint the walls any color you desire, turn up the volume on your CD player, attach permanent fixtures and decorate your home according to your own taste. Home ownership gives you and your family a sense of stability and security. It's making an investment in your future.
Appreciation
Although real estate moves in cycles, sometimes up, sometimes down, over the years, real estate has consistently appreciated. The Office of Federal Housing Enterprise Oversight tracks the movements of single family home values across the country. Its
House Price Index breaks down the changes by region and metropolitan area. Many people view their home investment as a hedge against inflation.
Mortgage Interest Deductions
Home ownership is a superb tax shelter and our tax rates favor homeowners. As long as your mortgage balance is smaller than the price of your home,
mortgage interest is fully deductible on your tax return. Interest is the largest component of your mortgage payment.
Property Tax Deductions
IRS Publication 530 contains
tax information for first-time home buyers. Real estate property taxes paid for a first home and a vacation home are fully deductible for income tax purposes. In California, the passage of Proposition 13 in 1978 established the amount of assessed value after property changes hands and limited property tax increases to 2% per year or the rate of inflation, whichever is less.
Capital Gain Exclusion
As long as you have lived in your home for two of the past five years, you can exclude up to $250,000 for an individual or $500,000 for a married couple of profit from capital gains. You do not have to buy a replacement home or move up. There is no age restriction, and the "over-55" rule does not apply. You can exclude the above thresholds from taxes every 24 months, which means you could sell every two years and pocket your profit--subject to limitation--free from taxation.
Preferential Tax Treatment
If you receive more profit than the allowable exclusion upon
sale of your home, that profit will be considered a capital asset as long as you owned your home for more than one year. Capital assets receive preferential tax treatment.
Morgage Reduction Builds Equity
Each month, part of your monthly payment is applied to the principal balance of your loan, which reduces your obligation. The way amortization works, the principal portion of your principal and interest payment increases slightly every month. It is lowest on your first payment and highest on your last payment. On average, each $100,000 of a mortgage will reduce in balance the first year by about $500 in principal, bringing that balance at the end of your first 12 months to $99,500.
Equity Loans
Consumers who carry credit card balances cannot deduct the interest paid, which can cost as much as 18% to 22%. Equity loan interest is often much less and it is deductible. For many home owners, it makes sense to pay off this kind of debt with a
home equity loan. Consumers can borrow against a home's equity for a variety of reasons such as home improvement, college, medical or starting a new business. Some state laws restrict home equity loans.
An important message from the CALIFORNIA ASSOCIATION OF REALTORS®:
I write on behalf of the CALIFORNIA ASSOCIATION OF REALTORS®, whose 170,000 members continue to witness the devastating consequences the home foreclosure crisis is having on California’s families, neighborhoods, and communities on a daily basis.
The number of families affected by foreclosure is staggering. During the past three years, more than 640,000 Californians have lost their homes. With the number of homeowners who owe more than their home is worth hovering at 30 percent, experts predict there will be many more foreclosures in 2011 and 2012. Unless we take immediate, aggressive action to assist these homeowners, any meaningful recovery in the housing market and overall economy will continue to be delayed.
Tragically, only a fraction of those who face foreclosure will remain in their homes when all is said and done. Those whose incomes and financial circumstances meet strict guidelines may qualify for a loan modification that will reduce their monthly payment to more affordable levels. Yet the federal Home Affordable Modification Program (HAMP) is expected to prevent only 700,000 to 800,000 foreclosures nationwide before it expires at the end of 2012, and the program does little to help those homeowners who are unemployed or otherwise no longer able to meet their financial commitments. Their last hope is to sell their home, which often means convincing their lender or the investor who “owns” the loan (and, in many cases, the holder of a second mortgage lien and the mortgage insurer) to accept a “short sale.”
With a short sale, homeowners with a proven hardship negotiate an agreement to sell their home for less than the balance owed. Although not every homeowner or mortgage is eligible, those who are able to finalize a short sale avoid a foreclosure on their credit record and can move on with their lives. Last year, 20 percent of home sales in our state involved short sales.
Short sales can play an important role in our state’s economic recovery by accelerating the pace of home sales and reducing the inventory of bank-owned homes on the market. There are other benefits as well. Homebuyers who can qualify for a mortgage at today’s low interest rates also are able to purchase a home at below-market prices. Banks get a nonperforming asset off their books and avoid the headaches associated with disposing of assets they don’t want to own in the first place. Neighborhoods have fewer abandoned homes, and local businesses have more customers with money to spend.
Unfortunately, many homeowners are unable to successfully negotiate a short sale. According to a recent survey of 2,150 California REALTORS® who have assisted clients with a short sale, only three out of five transactions closed – even when there was an interested and qualified buyer.
What’s the problem? For one, no two mortgage agreements are the same, so it can be difficult to standardize short sale processes and procedures. Many homeowners have second mortgages, which further complicate matters. Then there’s the challenge of convincing multiple parties to take a financial loss or, in the case of loan servicers, to forego fees they otherwise might earn during the course of the foreclosure process. Poor and slow service by many banks and servicers has only exacerbated the problem. Horror stories abound from potential homebuyers and REALTORS® forced to wait 90 or more days for a response to a purchase offer or being required to fax short sale applications or other paperwork as many as 50 times. These delays discourage potential homebuyers from considering a short sale purchase and undermine the process for those who short sales are intended to benefit – the hundreds of thousands of families facing foreclosure. Increasing the number of closed short sales by speeding up and streamlining the short sale process is one important way we can help California families avoid foreclosure and move our economy closer to recovery. That’s why the California Association of REALTORS® is taking steps to enable more families to arrange a short sale. Recently, we advocated for improvements to short sale guidelines established under the federal Home Affordable Foreclosure Alternative (HAFA) program. We’re meeting with major banks, U.S. Treasury officials, government-sponsored entities (including Fannie Mae and Freddie Mac), and others to urge them to standardize processes, comply with federal guidelines, improve communication with other stakeholders and increase staffing with the goal of eliminating service issues. We’ve also offered our members training in every aspect of the short sale process so they can assist their clients.
But we can’t do it alone. That’s why we’re focusing the spotlight on short sales and calling on regulators, elected officials, nonprofits, business organizations, companies, and individuals with a stake in California’s economic future to resolve this issue and others that get in the way of a recovery. It won’t be easy, and some compromises will be required. The important thing is that we need to act today. Our families and our communities can’t wait any longer.
Sincerely, Beth L. Peerce President CALIFORNIA ASSOCIATION OF REALTORS®
This is lesson #48 from my book Little Things Matter, 100 Ways to Improve Your Life Today, by W. Todd Smith.
If you are like most people you probably spend more time worrying than you should. Worrying about job security, project deadlines, health, shrinking budgets, rising taxes, the housing market, world poverty, our children's safety, even the weather. Some things we can control, others we clearly cannot. The key to maintaining a positive attitude in life is to know the difference.
I heard years ago that 92 percent of the things people worry about are beyond their control.
If you are troubled about something youcan control, like whether you are going to lose your job, then step up your game. Come in early, stay late, offer to work on a weekend, or volunteer to take on additional responsibilities; do anything you can think of to increase your value. If you end up losing your job, you can bet you'll get a better reference.
If you are concerned about your health, exercise regularly, eat a well-balanced diet, and refrain from smoking.
On the other hand, if you find yourself worrying about something like the safety of your son or daughter serving in the military, whether the government is going to raise taxes, or whether the coming storm will deluge you with rain, understand that there's no action you can take to make any impact on these events or circumstances.
You cannot control these things; worrying about them will just cause stress and affect your overall attitude. In the long term, worrying about what you can't control puts your health, happiness, and longevity at risk.
LTM Challenge
Make a list of the things you worry about. Divide that list into two categories:
1. Concerns you can do something about
2. Concerns beyond your control
Beside each of the items you can control, include an action item. For instance, if you worry about the ten pounds you've recently gained, put together a plan to do something about it. If you're concerned about an impending deadline, make a list of all the things required to get the project completed.
Make a commitment to attack everything within your control and be intentional about not worrying about the things you can't. At first, you'll find it hard not to worry about the things you can't control, but if you use self-discipline and refuse to worry about them, it will become easier.
One of the traits of positive people is that they don't worry about things they can't control.
Are you ready for a new year in real estate? The National Association of REALTORS ® is ready and prepared to predict a more positive year in real estate.
Existing-home sales are projected to rise about 8% to 5.2 million in 2011 from 4.8 million in 2010, with an additional gain of 4% in 2012. The median existing-home price could rise 0.6% to $173,700 in 2011 from $172,700 in 2010, which was essentially unchanged from 2009.
“As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2 to 3 percent in 2012,” Yun said.
New-home sales are estimated to rise 24% to 392,000 in 2011, but would remain well below historic averages, while housing starts are forecast to rise 21% to 716,000.
The musical Rent that came out in a New York City Workshop in 1994 reminded us to question how we measure our years on this planet. The cast sings that there are 525,600 minutes in a year, and that some people measure in sunsets, cups of coffee, laughter, or tears of joy. The song brings focus to the concept that we can bring awareness to the moments of our lives and how very precious they truly are.
Joni Mitchell sings the song Big Yellow Taxiwhere the lyrics say:
Don’t it always seem to go That you don’t know what you got till it’s gone They paved paradise, and put up a parking lot
While this song is talking about the loss of natural environmental beauty to an uprising of concrete jungle, the theme of not knowing what we have until it’s gone is a common experience.
We don’t realize the precious moments in our lives that are passing by us all the time as we’re searching for something better.
Is there a way to get reconnected with the sacred moments of daily life?
Can this moment that you’re reading this be considered a space in time where you might reflect on the day behind you and maybe see where those moments were?
Is there something in this moment right now, how you’re feeling, someone who is nearby you, a rare space of quiet with your coffee or tea, that can considered precious?
Simply reflecting upon this can prime your mind be more aware of these moments when they are spontaneously happening.
If the mind says, “been there done that” or “what’s the point, this is of no use,” see if you can be aware that these are just automatic negative thoughts that are likely a result of your mood and at the end of the day, which try to close you off to possibility.
Try this out as an experiment and see how it goes.
Well, the New Year is almost here and many of us are scrambling to put together a complete list of resolutions that will enable us to obtain every single one of our goals in 2011. It has been reported that an estimated 92% of people do not keep their New Years resolutions. How do you make sure you are not one of those people that gives up on this important list that will change your life for the better? I found a simple yet comprehensive article that will offer you some solutions. Here’s to making 2011 the best year ever!
10 Tips For Keeping New Year's Resolutions
The Best Way To Stick With Your New Year's Resolution Is To Plan Ahead.
Be realistic The surest way to fall short of your goal is to make your goal unattainable. For instance, resolving to never eat your favorite food again could be a bad choice. Strive for a goal that is attainable, such as avoiding it more often than you do now.
Plan ahead Don't make your resolution on New Year's Eve. If you wait until the last minute, it will be based on your mindset that particular day. Instead, it should be planned well before December 31 arrives.
Outline your plan Decide how you will deal with the temptation to skip that exercise class or have one more cigarette. This could include calling on a friend for help, practicing positive thinking and self-talk, or reminding yourself how your bad habit affects your life.
Make a "pro" and "con" list It may help to see a list of items on paper to keep your motivation strong. Develop this list over time, and ask others to contribute to it. Keep your list with you and refer to it when you need help keeping your resolve.
Talk about it Don't keep your resolution a secret. Tell friends and family members who will be there to support your resolve to change yourself for the better or improve your health. The best case scenario is to find yourself a buddy who shares your New Year's resolution and motivate each other.
Reward yourself This doesn't mean that you can eat an entire box of chocolates if your resolution is to diet. Instead, celebrate your success by treating yourself to something that you enjoy that does not contradict your resolution. If you've been sticking to your promise to eat better, for example, perhaps your reward could be going to a movie with a friend.
Track your progress Keep track of each small success you make toward reaching your larger goal. Short-term goals are easier to keep, and small accomplishments will help keep you motivated. Instead of focusing on losing 30 pounds, say, focus on losing that first 5. Keeping a food diary may help you stay on track.
Don't beat yourself up Obsessing over the occasional slip won't help you achieve your goal. Do the best you can each day, and take each day one at a time.
Stick to it Experts say it takes about 21 days for a new activity, such as exercising, to become a habit, and 6 months for it to become part of your personality. Your new healthful habits will become second-nature in no time.
Keep trying If your resolution has totally run out of steam by mid-February, don't despair. Start over again! There's no reason you can't make a "New Year's resolution" any time of year.
What a great little article on how to improve your happiness and self worth.Although not real estate related, there are some good basic tips that can be applied to everyday living.It sure did make me realize how easy it is to be happy and thankful for the simple things.I’m so fortunate for my good health, family, friends and business.Enjoy!
10 Ways to Be Happier
How happy are you―really? If there’s room for improvement, try one of these suggestions.
by Gretchen Rubin
A few years ago, on a morning like any other, I had a sudden realization: I was in danger of wasting my life. As I stared out the rain-spattered window of a New York City bus, I saw that the years were slipping by.
“What do I want from life?” I asked myself. “Well…I want to be happy.” I had many reasons to be happy: My husband was the tall, dark, handsome love of my life; we had two delightful girls; I was a writer, living in my favorite city. I had friends; I had my health; I didn’t have to color my hair. But too often I sniped at my husband or the drugstore clerk. I felt dejected after even a minor professional setback. I lost my temper easily. Is that how a happy person would act?
I decided on the spot to begin a systematic study of happiness. (A little intense, I know. But that’s the kind of thing that appeals to me.) In the end, I spent a year test-driving the wisdom of the ages, current scientific studies, and tips from popular culture. If I followed all the advice, I wanted to know, would it work?
Well, the year is over, and I can say: It did. I made myself happier. And along the way I learned a lot about how to be happier. Here are those lessons.
1. Don’t start with profundities. When I began my Happiness Project, I realized pretty quickly that, rather than jumping in with lengthy daily meditation or answering deep questions of self-identity, I should start with the basics, like going to sleep at a decent hour and not letting myself get too hungry. Science backs this up; these two factors have a big impact on happiness.
2.Dolet the sun go down on anger. I had always scrupulously aired every irritation as soon as possible, to make sure I vented all bad feelings before bedtime. Studies show, however, that the notion of anger catharsis is poppycock. Expressing anger related to minor, fleeting annoyances just amplifies bad feelings, while not expressing anger often allows it to dissipate.
3. Fake it till you feel it. Feelings follow actions. If I’m feeling low, I deliberately act cheery, and I find myself actually feeling happier. If I’m feeling angry at someone, I do something thoughtful for her and my feelings toward her soften. This strategy is uncannily effective.
4. Realize that anything worth doing is worth doing badly. Challenge and novelty are key elements of happiness. The brain is stimulated by surprise, and successfully dealing with an unexpected situation gives a powerful sense of satisfaction. People who do new things―learn a game, travel to unfamiliar places―are happier than people who stick to familiar activities that they already do well. I often remind myself to “Enjoy the fun of failure” and tackle some daunting goal.
5. Don’t treat the blues with a “treat.” Often the things I choose as “treats” aren’t good for me. The pleasure lasts a minute, but then feelings of guilt and loss of control and other negative consequences deepen the lousiness of the day. While it’s easy to think, I’ll feel good after I have a few glasses of wine…a pint of ice cream…a cigarette…a new pair of jeans, it’s worth pausing to ask whether this will truly make things better.
6. Buy some happiness. Our basic psychological needs include feeling loved, secure, and good at what we do. You also want to have a sense of control. Money doesn’t automatically fill these requirements, but it sure can help. I’ve learned to look for ways to spend money to stay in closer contact with my family and friends; to promote my health; to work more efficiently; to eliminate sources of irritation and marital conflict; to support important causes; and to have enlarging experiences. For example, when my sister got married, I splurged on a better digital camera. It was expensive, but it gave me a lot of happiness.
7. Don’t insist on the best. There are two types of decision makers. Satisficers (yes, satisficers) make a decision once their criteria are met. When they find the hotel or the pasta sauce that has the qualities they want, they’re satisfied. Maximizers want to make the best possible decision. Even if they see a bicycle or a backpack that meets their requirements, they can’t make a decision until they’ve examined every option. Satisficers tend to be happier than maximizers. Maximizers expend more time and energy reaching decisions, and they’re often anxious about their choices. Sometimes good enough is good enough.
8. Exercise to boost energy. I knew, intellectually, that this worked, but how often have I told myself, “I’m just too tired to go to the gym”? Exercise is one of the most dependable mood-boosters. Even a 10-minute walk can brighten my outlook.
9. Stop nagging. I knew my nagging wasn’t working particularly well, but I figured that if I stopped, my husband would never do a thing around the house. Wrong. If anything, more work got done. Plus, I got a surprisingly big happiness boost from quitting nagging. I hadn’t realized how shrewish and angry I had felt as a result of speaking like that. I replaced nagging with the following persuasive tools: wordless hints (for example, leaving a new lightbulb on the counter); using just one word (saying “Milk!” instead of talking on and on); not insisting that something be done on my schedule; and, most effective of all, doing a task myself. Why did I get to set the assignments?
10. Take action. Some people assume happiness is mostly a matter of inborn temperament: You’re born an Eeyore or a Tigger, and that’s that. Although it’s true that genetics play a big role, about 40 percent of your happiness level is within your control. Taking time to reflect, and making conscious steps to make your life happier, really does work. So use these tips to start your own Happiness Project. I promise it won’t take you a whole year.
