Register Real Estate Advisors

Did you know that nearly half of all the jobs since 2009 were created in Texas?  I feel blessed to live and work in the great state of Texas.  The annual economic output of Texas exceeds one trillion dollars and that number seems to be growing even in this economy.  Texas is a huge state.  Did you know that if the entire seven billion people in the world move to Texas there would be more than 1,100 square feet for every person on the planet.  According to the 2010 Census, Texas had over 25 million residents.  By 2030 Texas is stimated that it will grow to 40 million residents.  It seems like everyone wants to move to Texas and join us!  That can be compared to unloading four jumbo jets in Texas every day for the next 19 years.  To learn more about Texas current market facts you can view the new Texaplex Video on our blog that will post tomorrow!

SAN ANTONIO (San Antonio Business Journal) – Only two U.S. metro areas have had increases in home values since the peak of the housing market in 2007, and they’re both in Texas: Houston and San Antonio.

According to Oxford, Miss.-based FNC Inc., Houston reported a 4.8 percent rise in home values, while San Antonio reported a 2.7 percent increase.

Nationally, home prices were down 3.5 percent at the end of 2011 compared with prices reported in December 2010.

A recent study shows how important the following home-buying factors were to buyers:

• List Price:  72%
• Location:  69%
• Neighborhood:  55%
• Floor Plan:  37%
• Square Footage:  28%
• Schools:  22%

Sometimes when I get to the closing table clients will tell me, “It’s About Time.”  Especially first time home buyers who are anxious to get into their new homes, but they have to wait on their lenders and the title company to have everything ready for closing.  Then there are those cash buyers that think we should be able to close a home purchase in just three days!

In today’s real estate market it takes a minimum of seven days to close on a home purchase.  That is because a recent Real Estate Settlement Procedure Act disclosed rules stating that lenders cannot close a loan until seven days after they have provided the borrower with the original required RESPA disclosures and application (including the Good Faith Estimate and Truth-In-Lending Disclosure).  This is a consumer-protection measure designed to help ensure that a buyer has enough time to read and understand a loan before the closing.

If there are any last minute changes to the loan amount, purchase price, or seller contributions that will add three extra days to the closing.  RESPA now requires lenders to again provide the Truth-in-Lending Disclosure when the annual percentage rate changes 0.125% or more from the original disclosure of the APR on the Truth-in-Lending Disclosure—every single time.  Some lenders interpret this to mean that a re-disclosure is required only when the APR increases, while others require a re-disclosure when the APR changes 0.125% regardless of the direction of the change.  This is a protection that was put in place to prevent lenders from changing the loan note rate or fees on borrowers at closing without proper disclosure to the borrower.

Something else that slows down closings is when the buyer has not filed their tax returns.  All Self-employed borrowers must provide tax returns to their lender.  Consumers want to know why closings are being pushed back or why they fall through completely.  If you are the seller, you are really angered when the sale falls through and you have to put your house back on the market when you were already preparing to move out.  Below is an example to explain one of the many things that can go wrong…

A couple wants to buy a home.  The wife is a W2 employee and qualifies for the loan on the home.  The husband is self employed.  Under new lender rules, the lender has to request the tax returns for the past two years for the self employed spouse and could even require the financials for his company.  The lender has to then consider his business losses a liability, which affects the amount for which they can qualify.  See where I am going with this?  It is common for self employed people – especially those operating an LLC, LLP, or Subchapter S corp – to run their businesses at a loss.  Sometimes this is the difference between pre-qualified and pre-approved.

All of these new lending regulations can slow down or derail real estate transactions, so understanding the requirements will help you to be better prepared for your mortgage process so that you can close on time.  If you would like to pre-qualify for a mortgage, please contact RREA’s in-house lender at 281.288.3500 to get started on your path to home ownership.  We have Realtors that can provide you with a smooth transaction – from house hunting to the closing table.  Call us for more information.

HOUSTON (Houston Business Journal) – Wood Partners LLC has begun construction on Alta Woodlake Square, a $32.4 million luxury apartment community in Houston’s Westchase District.  The 256-unit complex at 2630 Tanglewilde St. will have studio, one- and two-bedroom apartments. The property will also feature a pool, outdoor kitchen, gym, and club room.  Preleasing is expected to begin in March 2013, with move-ins beginning by June.

HOUSTON (Houston Business Journal) – A new report from Marcus & Millichap projects that Houston will add 91,000 jobs this year, a surge that could stimulate demand for commercial real estate development.

The California-based real estate investment services firm predicts an increase in consumer demand, fueling development in commercial and retail properties, particularly in regional hubs like Houston’s Energy Corridor.

Marcus & Millichap anticipates 2.1 million sf of new retail space in the area this year, a 1 percent increase in inventory. Vacancy rates are expected to drop to 9.8 percent, and rents are expected to rise by 1.6 percent.

According to the National Association of REALTORS®, first-time homebuyers (FTHBs) accounted for half of all homebuyers in the United States last year.  Builders are taking note of those stats!  As a result, many builders in the Houston area are adopting marketing practices targeted at the FTHB market.  They are also making design changes to FTHB preferences.

Did you know that for as little as $650 a month you could own a townhome instead of renting?  Some townhomes rent for $900!  Compare the savings of renting vs. owning a townhome or house.  There’s also a lot of savings on energy bills in newer homes vs. apartments.  Most homes being built for today’s consumers are considered “Green” homes that have energy-saving features.

Many people rent because they do not want to maintain a home.  Did you know that if you buy a condominium you do not have to maintain the grounds?  There is little to no maintenance with a condo purchase.

Consider all of your options when renting, because there may be an alternative that could turn in to a nice investment in the future.

WASHINGTON (U.S. Department of Housing and Urban Development) – The U.S. Department of Housing and Urban Development (HUD) has issued new regulations ensuring that eligible persons, regardless of sexual orientation or gender identity, have access to important housing programs. The final rule includes several provisions for the two groups, including equal access to HUD-assisted housing and FHA mortgage programs. Regulations also prohibit owners of HUD-assisted housing to ask about applicants’ sexual orientation and gender identity in determining program eligibility. The new published rule goes into effect March 5, according to the Texas Association of Realtors.

The Federal Housing Authority (FHA) offers two (2) types of home-improvement loans for homebuyers:

• FHA’s 203(k):  This program allows qualified homebuyers to roll the costs of major improvements and upgrades into their home mortgages.  A 203(k) loan begins with a feasibility study, overseen by an approved consultant.  During this process, the consultant determines whether the improvements would be justified upon completion.  (Luxury items and improvements that do not become a permanent part of the real property are not eligible as a cost of the home’s rehab.)  Along with the lender, the consultant monitors the project’s progress and performs a final inspection upon completion.  Escrow is then closed out, and any remainder is paid down against principal;  and,
• FHA’s Streamline 203(k):  FHA’s Streamline 203(k) Buy & Repair Mortgage is an ideal program for clients in need of minor cosmetic repairs on their potential new home.  With a Streamline 203(k) mortgage, the rehab cost is calculated into the original loan balance, resulting in one loan.  The mortgage balance can exceed the purchase price of the property.  The appraiser or home inspector will compile a list of recommended repairs/improvements.  Unlike the Major 203(k) program, Streamline 203(k) eliminates the need for a consultant and consultant’s fees. 

Following are charts which compare the program highlights and the ineligible and eligible repairs and improvements under FHA’s 203(k) Buy & Repair Mortgage and FHA’s Streamline 203(k) Buy & Repair Mortgage: