$8,000 Tax Credit for first-time home buyers!

Congress Enacts Bigger and BetterHome Buyer Tax Credit

A tax credit of up to $8,000 is now available for qualified first-time home buyers purchasing a principal residence on or after January 1, 2009 and before December 1, 2009. Unlike the tax credit enacted in 2008, the new credit does not have to be repaid.

Atlanta Home Prices one of first to rebound in '09

According to projections from the National Association of Realtors and Moody's Economy.com Atlanta should be one of the first metro areas to see a rebound in home prices in 2009 and 2010. In a study of the top 100 markets in the country only 2 are expected to show gains in 2010, McAllen Mission, Texas and New Orleans. Of the top 10 largest metropolitan areas in the U.S., where Atlanta ranks 9th (2007 U.S. Census Bureau), only Dallas and Houston are predicted to hold on better to home prices.

In addition, the median home price in Atlanta is $155,630 which is the 2nd lowest of the top 10 cities and more than 200% less than the New York City area which boasts an average home price of $481,890.

Below are the 10 largest metropolitan areas in the U.S. and the expected change in home prices in 2009 and 2010.

City ............Med Price .........2009......... 2010

New York........$481,890........-15.2%........... -3.5%
Los Angeles.....$375,340........-24.9%...........-5.1%
Chicago...........$258,860..........-6.8%...........-0.2%
Dallas..............$157,190...........-1.2%.............2.3%
Philadelphia...$227,780..........-9.5%...........-1.5%
Houston..........$151,110.............-2.3%............1.7%
Miami.............$293,590..........-22.8%..........-6.4%
Was D.C. ........$343,160..........-19.9%..........-5.7%
Atlanta............$155,630...........-3.2%...........0.9%
Boston.............$360,830.........-15.4%..........-1.0%

Case-Shiller Price Index for July 2008

The table below summarizes the results for July 2008. The S&P/Case-Shiller Home Price Indices are revised for the 24 prior months, based on the receipt of additional source data. More than 20 years of history for these data series is available, and can be accessed in full by going to www.homeprice.standardandpoors.com.
Metropolitan July 2008 July/June June/May 1-Year
Area Level Change (%) Change (%) Change (%)
---------------- -------- ---------- ---------- ----------------------------------
Atlanta 125.23 0.4% 0.3% -8.2%
Boston 162.58 0.2% 1.2% -5.4%
Charlotte 133.20 -0.2% 0.2% -1.8%
Chicago 149.60 -0.4% 0.1% -10.0%
Cleveland 109.35 -0.3% 0.7% -7.8%
Dallas 123.16 0.6% 0.7% -2.5%
Denver 132.67 0.8% 1.5% -4.7%
Las Vegas 154.15 -2.8% -1.6% -29.9%
Los Angeles 192.55 -1.6% -1.4% -26.2%
Miami 186.84 -1.6% -1.7% -28.2%
Minneapolis 143.43 1.3% 0.9% -13.1%
New York 192.92 -0.8% 0.1% -7.4%
Phoenix 149.09 -2.7% -2.6% -29.3%
Portland 174.21 -0.5% -0.3% -6.6%
San Diego 172.20 -1.8% -1.5% -25.0%
San Francisco 156.88 -1.8% -1.8% -24.8%
Seattle 176.51 -1.0% -0.2% -8.2%
Tampa 175.07 0.0% -1.1% -19.4%
Washington 195.49 -1.1% -0.8% -15.8%
Composite-10 178.46 -1.1% -0.6% -17.5%
Composite-20 166.23 -0.9% -0.5% -16.3%
------------ ------ ----- ----- ------
Source: Standard & Poor's and Fiserv
Data through July 2008

FHA Lending Bill

The new Housing bill was approved by the House of Representatives yesterday and is expected to move through the Senate as well as the President by as early as next week.
Here are the major components:

FHA Changes
Mortgage limits for high cost areas will be increased to $625,000 on a permanent basis (115% of the current conforming limit).

The FHA floor will go from 48% to 65% of the current conforming limit. This will put the new permanent floor at $271,000.

Cash downpayment is set at 3.5%.

The seller funded down payment assistance program (DPA) will be terminated on September 30.

The risk based premium established by HUD last week will be suspended on September 30. The ceiling on upfront premiums will go to 3%. It was 1.5% just months ago….

Foreclosure Market

It is hard these days to pick up a paper or turn on the news without hearing about foreclosures. My the amount of media play it gets you would think every other person you come across is losing their home. Here are a few things that might clear the air on the realty of the matter.

• 2% of all homes in America are in some part of the foreclosure process. So if you live in a typically sized neighborhood of 300 homes, 6 are in trouble with the bank. Historically there are always 1% to 1.25% of homes in foreclosure. The news is correct when they say there is a 75% to 100% rise in foreclosures but on a pure numbers basis 98% of all Americans are up to date on their mortgage payments.
• This is not to ignore the pockets and sub-markets around the country that are getting annihilated by foreclosures. For Atlanta, that market is on the south side and in lower-income areas where the sub-prime lenders feasted on uneducated buyers. They put them into loans they didn't understand with no money down. Of course they walked when things got bad. They had no money to lose and the credit was already bad - that's why they need sub-prime loans in the first place!
• There is this idea that with all the foreclosures a buyer can go down the street and pick up a house 50% off. Wrong. First you must understand the process then understand the people that control the process. Both of those are topics for another day but in short the process is long, 6 to 9 months in a normal market, but is very long now, sometimes over a year because of the massive amount of numbers the banks are dealing with. Remember most of these loans are held by secondary companies that purchased these as investments. They are not staffed to sell hundreds of foreclosures. Think of the pain you go through with your local bank to get basic service. Now put that "service" representative in a cubicle and in charge of selling hundreds of homes around the country in markets they have never heard of! No wonder there is a huge bottle neck in the market.
• Less than 25% of foreclosures are below market price when the hit the market bank-owned. Now 50% may sell below market value but only over an extended period of time and patience from the buyer. It is not to say you cannot find a deal, you just have to look hard and be willing to wait.

There is so much more to this topic that I haven't even scratched the surface. Hope you find this helpful and somewhat interesting!

Welcome to my Atlanta Real Estate Blog

Welcome all to my very first blog! I never claimed to be cutting edge but I will attempt to embrace this form of community chatter with hopefully some interesting and helpful topics pertaining to real estate. I know my wife will be glad that I have another outlet for my thoughts and frequent ramblings other than her ear during some "fascinating" reality show!

Real estate is something that I have always found very interesting and I've been fortunate enough to work in this area for the past six years in both residential and commercial with gives me some unique perspectives.

I hope this can be an area where I can answer questions and offer discussions on a market place that is ever changing and so much a part of all of our lives.

Thanks and happy blogging! Greg