Tag Archives: mt. carmel real estate

The Party Might Just Be Ending for Low Interest Rates

It’s safe to say that mortgage interest rates have been at historic lows since the summer of ’09, mostly around and sometimes even under 5%.  Currently, they’ve been floating around the 5 & 1/8% range.

Part of the reason for these low rates has been because the Fed has been on a buying binge of Mortgage Backed Securities (MBS).  The Fed has been buying $1.25 trillion in mortgage-backed securities in its effort to prop up the economy but has said it will end those purchases March 31.

As I speak fairly regularly with seasoned, well-informed, and intelligent mortgage lenders and brokers, one thing they all seem to agree on is that the expectation is that, after March 31st,  rates will head upwards, and will likely be in the 6% range.

Still pretty low, historically – but, a significant impact to the buying power of home buyers out there.

Just think about it, if you’re looking at a loan amount of say $700,000, this means that a 1% increase in interest rate translates to paying $450 MORE per month on the same loan.  Or looked at another way, a 1% increase in rate just reduced the sale price you can afford by about $80,000.

Quoting some highlights from a recent WSJ article:

What happens when it (the Fed) stops buying hundreds of billions of dollars in financial assets?

In its monetary-policy statement, the Fed said it would “gradually slow the pace of these purchases in order to promote a smooth transition in markets.” Suddenly cutting to zero, presumably, could prove too much of a jolt.

But even a gradual pullback could have big repercussions. Zero interest rates and Fed purchases — financed by printing money — have played a massive role in reviving stocks and bonds and rekindling the economy.

Mortgage rates will likely move up, as private-market buyers will charge more than the Fed for bearing the risks of holding government-backed mortgage securities. Now, the Federal Reserve has said they would consider reopening its program to support the mortgage market if interest rates spiked or the economy showed new weakness

In its best corporate-speak, the Fed said they will “evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and conditions in financial markets.”  That is, if markets play along. Investors are already balking at the heavy use of printing presses. Just look at the sliding dollar.

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New Mount Carmel Listings – Week of Jan. 12

A few new listings have recently popped up here in the Mt. Carmel area. The first of which — a bit of a fixer — looks like a great value in terms of price (at least on paper). Take a look:

  • 327 Jeter: $585,000 – 2br/1ba, 1140 sq. ft. on a 6500 sf lot.  Already has an offer date set (tomorrow, 1/13).
  • 532 Ruby: $549,000 – 2br/1ba, 980 sf on a 4800 sf lot
  • 266 Lowell: $949,000 – 3br/3ba, 1370 sf on a 6500 sf lot (this one is a re-list. Had been on the market for the past year or so, at a higher list price).

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Federal Tax Credit For Home Buyers Gets Extended – Well, Happy Early Christmas!

fed housing tax creditAn early Christmas present for many home buyers came in the form of the extension of the federal tax credit for home buyers, and was signed into law by President Obama Friday, Nov. 6.  The tax credit, which was set to expire Nov. 30, has been extended through April 30, 2010 with a 60-day extension if a binding contract is in place prior to deadline.  It also was expanded to include existing homeowners who have lived in their primary residences for five consecutive years out of the last eight years.

For all kinds of FAQs (aka, “Everything You Wanted to Know About the Tax Credit….But Were Afraid to Ask), see the official website here.

First-time home buyers still may be eligible for a tax credit of up to $8,000, while existing homeowners may receive a credit of up to $6,500.  The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers, to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000 in both instances.

Under additional provisions in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The bill maintains the provision that home buyers do not have to repay the credit provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.

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Recent Sales in Mt. Carmel ‘Hood

It’s been awhile, so here’s a quick snapshot of some recent sales that have been going on in the Mt. Carmel area. Firstly though, looking at some overall statistics, I’d say the one word to describe it is “HEALTHY”.

Here’s the bottom line, for the last 3 months of sales:

Average Percent of List Price: 99%

Average $ per sq. ft.: $537

Average Days on Market (DOM): 33

 

188 Inner Circle: List price (LP): $579K, Sale price (SP): $612K;  9 DOM

313 Topaz St.: LP: $739K, SP: $730K;  12 DOM

1740 Whipple Ave: LP: $650K, SP: $675K;  14 DOM

531 King St.: LP: $899K, SP: $890K;  6 DOM

23 Myrtle St.: LP: $1.035M, SP: $1.035M;  17 DOM

516 Quartz St.: LP: $608K, SP: $585K;  28 DOM

15 Iris St.: LP: $1,149,900, SP: $1,032,300;  91 DOM

45 Hudson St.: LP: $1.795M, SP: $1,599,950;  90 DOM

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Recently Sold Homes in Mt. Carmel – 95% (average) of List Price

In the last 90 days, a little less than a dozen homes in Mt. Carmel have closed escrow. Looking at how the sale prices compared to original price, the average is that homes are getting 95% of their original asking price.  Of course, remember, this is an average.  The “range” of all those homes is between 83% and 101% of asking price.   Here they are, in no particular order:

  • 475 Sapphire: original list: $599K, sold for $605K, 10 days on market
  • 566 Avenue del Ora: original list: $599K, sold for $590K, 8 days on market.
  • 250 Myrtle St.: original list: $924,900, sold for $882K, 37 days on market
  • 277 Topaz: original list: $650K, sold for $610K, 7 days on market
  • 37 Fulton: original list: $975K, sold for $950K, 18 days on market
  • 587 Ruby: original list: $749,950, sold for $730K, 32 days on market
  • 338 Lowell: original list: $850K, sold for $830K, 188 days on market
  • 15 Eagle Hill Terrace: original list: $949K, sold for $890K, 70 days on market
  • 181 Myrtle St: original list $869K, sold for $835K, 57 days on market
  • 366 Iris St: original list: $1,110,000, sold for $975K, 99 days on market
  • 40 Inner Circle: original list: $1,199,000, sold for $995K, 189 days on market

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A Dying Breed: Paying Over $1M for a Mt. Carmel Home

dodoIt seems like just yesterday – ok, maybe 2 or 3 years ago – when a new listing in Mt. Carmel that came on the market with a price tag higher than $1M didn’t raise an eyebrow. Heck, there were even some bordering close to $2M that I thought “well, if someone’s willing to pay that much, then that must be what it’s worth.”

Of course, these are wildly, WILDLY different times now in real estate. That shouldn’t come as a shock to anyone, right?  Well, as experts in what we do, many of us Realtors can quickly and generally assess a home’s list price relative to its neighborhood and say, “yes that’s priced well”, or “what the hell is the color of the sky on THEIR planet?”, or “what are they smoking in their pipe?”  You get the idea.

I’m talking now, of something that seems to be getting more extinct than journalistic integrity in real estate reporting (oops! Did I just say that out LOUD?), and that is, paying over $1M for a home in the Mt. Carmel area.

Let’s do a quick look at the numbers: out of the 16 homes that have sold in Mt. Carmel in the last 6 months, only one of them sold for over the elusive $1M price tag (that would be 263 Iris, for $1.238M, which, incidentally, was one heck of a gorgeous home).

And out of the 17 homes currently active for sale, 8 of them are priced at over $1M.  A few of those have been on the market for 361 days, 259 days, 116 days, and 98 days.

Now this absolutely is not saying that any of these homes currently on the market is not worth its asking price.  As I always say, the value of your home is whatever a buyer is willing to pay you (and for you to accept). If you’re a seller, then this blog post and this one are MUST READS.

And what I also say is that if your home is on a busy street, and you want to sell it in under 1 year, do NOT price it as if it were set further in on a neighboring, non-busy street.  It’s a pretty rare breed of buyer that wants to buy a $1M+ home on a busy street, especially if they have children.  An even rarer bird is the buyer who will pay over $2M to live on a busy street – I just seem to think, if it were me and I were spending over $2M on a home, I’d be more inclined to look in, oh, Emerald Hills, Woodside, Portola Valley, Los Altos, San Carlos hills…but that’s just me, what the heck do I know about what buyers want (rhetorical sarcasm…don’t answer that!).

Time will always tell what these homes eventually will sell for.  Timing is everything – if you were fortunate enough to sell a home 3 years ago for a price that no one would touch in today’s market, you may be more lucky than anything else.

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Is Your Property Tax Bill Too High?

Cash

Income tax, sales tax, estate tax, excise tax, alternative minimum tax…and just when you thought you’d paid them all…along comes your property tax bill as a homeowner. But did you know that the National Taxpayers Union estimates that as many as 60% of homes are assessed for too high of a value, resulting in an incorrectly larger property tax bill? Chances are good you might be in that group of people paying too much, so taking the time to review your property tax bill could save you a nice chunk of change.

The good news is that it’s easy.

First, contact your local tax assessor’s office and ask for someone in the reassessment area. Find out when appeals are heard, and how the process for submitting a property tax appeal works. Additionally, ask for a copy of your property card. Review the card and confirm that the basic information about your property is correct. For example, is the square footage and number of rooms for your home accurate? If the number is incorrect, the county may change the assessment without a formal appeal. If everything on the property card is correct but the assessed value still seems too high, your next step is to gather the following documentation to support an appeal. And don’t be surprised if the assessed value is lower than what you think the market value for your home is–many counties use a formula which uses a percentage of market value to determine assessed value. Ask what the formula is, because an assessment which is less than market value still might be too high.

If you have a current appraisal that supports the value being lower using recent market-value information, many counties will accept a copy of the appraisal with the appeal. If the appraisal is outdated, you can order a new one–just call me for a referral to a great appraiser. You can also visit the local assessor’s office or search online, and look through the public records for other homes that have similar features to yours, but have lower assessments. Additionally, contact me to get in touch with a great Realtor who knows your area. They will be able to give you current market information for your neighborhood, and help you see how your market value and assessed value stacks up against your neighbors’.

Submitting an appeal is generally a fairly simple process, but make sure to take the time to fill out all forms in advance and be prepared with your documentation if there is an in-person hearing that needs to take place.

More good news – according to the National Taxpayers Union, about 33% of property tax appeals succeed. Taking the time to review the accuracy of a tax bill could easily save you hundreds of dollars per year, adding up to thousands of dollars during the time you own your home.

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