Baltimore and Harford Counties Market Update January 2013

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The spring market in real estate is well under way and we are seeing lots of activity to show for it! As expected, things are picking up and we are very busy as a result. Buyers are out there, eager to lock in the still very low interest rates and with decreased inventory levels the better homes are going fast!

In terms of the number of homes available on the market for sale, we are reporting a 15% decline, with a good portion of the homes for sale being foreclosures. We are still dealing with the challenges of having about one fifth of our inventory being short sales.

As a buyer, keep in mind that this will be a test of your patience. Since despite getting some great deals on bank-owned and short sale homes, the process will inevitably take anywhere from two to four months at least, to get responses back from the banks.

The good news is that the distressed properties for sale are largely in good condition, with banks and owners doing much to prepare them with fresh paint, new flooring and other remodel or renovation done. Not only does this help our property values in the area in general but also it helps to steer the marketplace and drive activity.

If you’re considering buying a home – we strongly suggest that you act fact. With inventory levels dwindling fast and the market picking up the pace, you will find more and more buying competition as the season goes on.

It’s also a great time to sell your home with so many buyers out there looking to make an offer in time for the warmer months of the year.

As always, we welcome your calls or email and look forward to assisting you with your real estate needs!

The Baltimore and Harford County Area Market Update – December 2012

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In the wake of our nation’s housing market ups and downs over the past several years, 2012 has certainly been a strong one in terms of a comeback. Particularly at the cusp of the New Year, we are seeing some good things happening. There are still some challenges but overall this is a great time for buyers and sellers alike.

Fewer Distressed Sales on the Market

At one point foreclosures had a significant presence on the market but slowly they have dwindled downward. Today we have some foreclosures in our inventory but not so many that they impact the industry and price indexes. With interest rates as low as they are today, many investors are grabbing well-priced homes – often resulting in multiple offer situations and artificial price inflation.

Short sales, however, are still taking a long time to process. Though most banks have streamlined their processes, people should still be wary of the many steps involved. In fact, if buying a short sale home in our area, buyers must be willing to accept two things. First, prices are not as low as they were just a couple years ago. Second, banks are now expecting sale prices closer to market values before they will approve the short sale. It’s imperative for buyers to be patient during the process and to confirm whether there are any encumbrances on the property such as multiple mortgages or tax liens.

Holidays Still a Good Time to Sell

One of the biggest holiday season misconceptions many sellers have is the notion that there is less real estate activity during this time. The truth is that though there may be fewer buyers, there are equally as fewer homes on the market. Since the buyers that are out there are very serious, the result is about the same number of sales as in the “busy season” during the spring and summer in percentage compared to active inventory.

Spring Sales Require Wintertime Prep

If you are like the countless homeowners that are comfortable with selling once the spring season begins, now is the time to start preparing your home. Whether you need to fix up things that need repairing throughout the home or remodel – try to do it in advance. Once you are ready to put your home on the market, it should be in tip-top condition so you can expect to yield top dollar.

We offer a complementary thorough walk through to share with you the things we feel could use some R&R. We also have a stager share their tips with you on how to maximize marketability and ultimately get you the best price, in the quickest time and with the least hassle.

Strengthen Your Credit Now for a Strong Future

A lot of people have unfortunately faced many hardships during the past several years, with anything from job loss to relocation, downsizing, health concerns, death, divorce or more. Credit scores have been impacted so much and banks have tightened their lending guidelines to a level that rebuilding credit is actually now a part of the home buying process for many. If you are unsure where you stand financially according to mortgage guidelines, contact us and we will put you in touch with a reputable lending partner. You will receive guidance on how to rebuild and replenish a strong financial standing.
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No matter what your home buying or selling needs are, we encourage you to start exploring your options now. We can be reached at 410 638 9555 or directly via email at lee@leetessier.com. Thank you for the opportunity to serve you!

Maryland Residents Have Until December 31st to Claim Their Homestead Tax Credit

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A surprisingly small number of homeowners across the State of Maryland have applied for the Homestead Tax Credit this year and it comes at a time when many are still working to improve their individual financial situations. Through the end of this year, homeowners have the ability to log onto the state’s Department of Assessments and Taxation website to 1) check whether they have filed for the tax credit during the past five years and 2) file if not done so already.

The financial ramification of not doing so is fairly significant. So much so that for residents of Baltimore County and Baltimore City – the expected increase of taxation can be as high as 4%. The number is even higher for those homeowners that reside in Harford County, with an increase of up to 8% possible.

Rather than face the potential of that much more expense year after year, homeowners can simply visit the Department’s website at www.dat.state.md.us, click on Real Property Data Search and check to see if an application has already been filed or click http://sdatcert3.resiusa.org/rp_rewrite/. Those needing an application can have a form mailed to them by submitting a request to the email address: hcredit@dat.state.md.us.

Among other things, the application form will have information about your property’s access number and the property account number as well, important pieces necessary to move forward with the Homestead Tax Credit process. These two will allow the form to be submitted online, resulting in an email confirmation number – otherwise not available when applied via snail mail.

Rather than regret it later, we would like to strongly suggest to all homeowners in our area that they visit the Department website, check to see whether they need to apply for the Homestead Tax Credit and get it done as soon as possible.

As stated in this letter  by the State of Maryland’sDepartment of Assessment and Taxation, more information about the application is found on the website under Homestead Eligibility Application in the center column of the home page.

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If you have any questions about the Homestead Tax Credit, or anything else related to real estate – please do not hesitate to call us at 410-638-9555. We look forward to assisting you in any way we can!

Getting a Loan in Today’s Environment Is Easier Than Most People Think

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We often get asked about the ease of getting mortgages and it’s an understandable question given the rollercoaster ride our industry has faced since 2007. But today, things are a lot different than they were just a few years ago. Banks are still particular but they are not afraid of lending. In fact, they have plenty of money to lend.

The real question is “how has the process changed?” and also whether or not it is actually difficult to obtain a mortgage. And the answers will surprise you. Not only is the process to obtain a mortgage easier than most people seem to think but also it is really not too much more a changed process than a few years ago.

Banks Are Simply More Cautious

It used to be that most people could walk into a bank, present their ID and almost literally walk out with a bank note and keys in hand. Well, ok not exactly but it was almost that easy and credit scores were not as important as they are today. What has changed is that banks now take extra precautions to ensure borrowers’ financial viability and ability to repay the loan. There has never been a more thorough documentation process involved and for good reason.

Today, a borrower must show that they are responsible citizens that are worthy of paying back their debts. They must have a credit score of 620 or higher and income must be proven with at least 2 months’ pay stubs, two yeas of employment on record and 2 years of tax returns to corroborate the financials. Bank statements are also required as part of the process.

The bottom line is this: if you pay your bills on time, can prove a reasonable income level and a low enough debt-to-income ratio that supports the mortgage you are looking to obtain, chances are you will be approved. Making payments on time is critical as it is the primary source of information that lenders will review when they look at your credit report.

Many Loans Offer Low or No Down Payment

As far as the ease of being able to actually obtain the home, a lot of people are unsure of lenders’ down payment requirements these days. The truth is there are many programs out there that allow buyers to put only 3%, 5% or even NO money down. Depending on which program and financing options you select, there are benefits offered to military veterans, people seeking homes in certain areas in the outskirts of the city and also income-based low down payment programs as well.

One of the most popular financing options that many buyers choose is FHA financing which requires just 3.5% down on the purchase of a home. Since this option is not limited just to first-time buyers it is a great choice for many buyers.

Buyers Can Contribute to a Smoother Process

Some of the things that buyers can do to prepare in advance and to help the financing process go as smoothly as possible include preparing two years of tax returns, employment pay stubs and the two most recent months of bank statements. In addition, retirement statements, divorce decrees and rental histories showing responsible repayment habits.
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Now is a great time to buy a home! Don’t let the rumors out there discourage you from starting the process. Lenders are lending. Right now homeowners are able to function in a home for far less than it would cost to rent each month. In fact, it often costs less to move into a home than it does to move into a rental unit, considering the first and last month’s rent and security deposit.

If you would like to explore your options, we invite you to contact us today! We look forward to making your real estate dreams become a reality.

Fast-Tracking Foreclosures Have Many Homeowners Jumping for a Short Sale Before It’s Too Late

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Are you behind on your mortgage payments? Does it seem that you have no way out and a foreclosure is inevitable? Well before you give up, consider a short sale. In fact, now may be the best time for you to sell your home as a short sale because of what may be soon to come. Banks are filing for foreclosure faster than ever before – and this comes at a time when many homeowners with underwater mortgages have become complacent, expecting more time.

Not only should you put your home on the market now as a short sale to avoid a foreclosure but also, making the move quickly could possibly save you thousands of dollars in taxes.

Right now, and through December 31, 2012 any forgiven debt may be discharged under the Mortgage Debt Forgiveness Relief Act. What this means is that any money you are discharged from paying back that would otherwise be considered as income by the IRS, is exempt from taxation through the program period. But as soon as January 1, 2013 rolls around, unless the program is extended, you would have to pay taxes on that “income”.

So if you are behind on your payments and it seems the bank is getting antsy, take this advice: consider short selling today.

We deal with many of these and would be happy to sit down with you to discuss your options. Contact us today!