Utah Real Estate Survival Guide

Helping You Navigate Our Local Real Estate Market

Archive for the tag “2011”

Paying for the Homebuyer Tax Credits – The Cost Runs Deep

In November of 2009, I wrote a blog post entitled Was the Tax Credit Extension a Good Idea?

Here is an excerpt:

In my opinion, tax credits have become subsidies distorting the real estate market. I believe that any further extension or expansion of this program, with the exception of those benefits due our military, will be counterproductive. I say it’s time to help homeowners. Figure out how to give them $8,000 so that they don’t have to sell as a short sale. There are a lot of well loved homes in excellent condition that would make ideal homes for new buyers, creating move up buyers for other homes, that can’t be sold now because the sellers are upside down in their mortgages. A short sale may benefit a new buyer, but it eliminates another (for two years at least). Why not consider helping sellers with a monetized tax credit so that they can sell their home at market value, stop or minimize short sales and foreclosures eroding property values, get buyers into “non-distressed” homes and turn that seller into another buyer, thus propelling the market forward.

Here is what I am experiencing today:

I have received numerous requests through the holidays for market evaluations from homeowners who either bought, or refinanced, during the past 3 years. What I’m finding is that the value of these homes is almost as upside down as those of homeowners who bought in 2006-2007. Artificially inflated home sales prices, driven by subsidized demand, and used by appraisers to substantiate further inflated home sales prices, is setting the stage for Round 2 of the Great Housing Crisis. Not only will the various homebuyer tax credits burden the Federal budget deficit for years, we have now created a situation where the same homeowners who benefited from $7,500 – $8,000 in “cash back after closing”, are going to be in the distressed property boat along with everyone in the coming tide of foreclosures. Good luck getting THAT money back.

The solution is simple stated. It’s about jobs. Always has been and always will be. How to create those jobs should be the domestic policy focus of 2011. Ideas?

2011 Salt Lake Housing Forecast Breakfast

Please let me know, by January 5th, if you would like to join me! I have four extra tickets available for non-Realtor® guests. If you’re thinking about buying or selling a home, this event would provide much more relevant, decision making information than the news you get from any of the national media outlets. All real estate is local, and this is OUR local housing report.

(Salt Lake Realtors) BOARD OF DIRECTORS MESSAGE

… 2011 Salt Lake Housing Forecast Breakfast on Tuesday, Jan. 11 at 8 a.m. at the Little America Hotel in downtown Salt Lake City.

This year Lawrence Yun, chief economist for the National Association of REALTORS, will speak on recent developments in the housing market and the direction home prices are headed in the next 12 to 24 months.

In addition, a housing forecast by James Wood, director of the University of Utah’s Bureau of Economic and Business Research, will be distributed. This report will offer a glimpse of what is in store for Salt Lake County in 2011.

Seating is limited. The deadline to register is Wednesday, Jan. 5. Members are free. $25 for guests.

CNBC’s How’s Housing? Report

The news contained in this report is simply that 2011 will continue to be a strong buyer’s market. Sellers who have been holding off listing their homes for sale, anticipating real estate values to recover, are going to have to wait at least 12 – 18 more months to see any improvement. It is NOT going to happen this spring.

This is not necessarily bad news. If a seller is also looking to buy a home, then they should be able to take advantage of home prices comparable to those in 1997. Interest rates are still at or below 5%. Two historic conditions that may not present themselves again.

This is the time for savvy home owners, current or new, to take advantage of unprecedented opportunity in the housing market.

Click here to watch the How’s Housing? Video
Posted to: Mortgage and Real Estate Video News
Wednesday, December 22, 2010 10:08 AM
Discussing the state of the housing market and the impact rising interest rates are having on the housing inventory, with CNBC’s Diana Olick.

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