Monthly Archives: March 2012

But I Thought It’s a Buyers Market

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Although there are unbelievers out there, we really are in a seller’s market right now with below-average level of for-sale inventory.  There are more buyers out there than properties, so we realtors are all showing the same homes and competing with one another.  I am seeing anywhere from 8 to 15 offer come in within days of the listing.  As a buyer it is important to ensure your agent is showing you property as soon as it’s listed so that you do not miss out on any opportunities to put in an offer on a home.

Educating our buyers becomes extremely important in a seller’s market.  Most homes are priced aggressivley to sell (mainly distressed properties), so putting in an offer at list price isn’t going to get you the home.  In most cases buyers will need to offer above list price to get the home (especially if they are asking for concessions).   If buyers need 3% credit for reoccurring and nonreoccuring closing costs, the offer should include at least 3% higher than list price and even more to be the winning offer.  Of course, comps will need to support the offer amount for appraisal purposes.

Sheri Negri
Better Homes & Gardens Real Estate
925 Highland Pointe Drive #140
Roseville, CA 95678
(916) 606-3210
Sheri@LoveForHomesSac.com

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Significant FHA Loan Changes in April 2012

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Over the past few years FHA has increased their premiums to cope with mounting losses to their mortgage insurance fund; starting April 1st 2012 they’re at it again. If you go into contract on or after April 1st 2012 the upfront mortgage insurance premium will increase from the current 1% to 1.75%; on a $300,000 loan that’s additional $2250.

The monthly mortgage insurance will also increase 10 basis points.  On a $300,000 loan with a 30yr fixed FHA loan with a 3.5% down payment the monthly premium will jump from 115 basis points or $287.50/month to 125 basis points or $312.50/month; an increase of $25/month.

On loans over $625,500, for all case numbers assigned on or after June 1st 2012, the monthly premium will increase 25 basis points to 140; on a $700,000 loan that’s an increase of $145.84/month.

This change will encourage more potential homebuyers to look into traditional conventional financing with 5% down and lower overall costs.