Today’s housing market is challenging. That’s a given. It’s tough on buyers and sellers alike, who are anxious, not knowing where the real estate market is going next. They both want — and often need — a great deal whether they are buying or selling. Our current real estate market requires a special perspective no matter which side of the settlement table you are on. The rates inched up a bit last week, and the market has been hot.  If you have been waiting for interest rates to get better and home prices to fall, then you might get left out of the chance to buy.

Savvy buyers can readily find a lot to love in today’s market. Buyers feel the love from low interest rates and competitive prices to a huge selection of homes and incredible investment opportunities. Look past the national headlines — which are gloomy at best and don’t apply at worst — to our local real estate market. Here is where buyers benefit the most when the going is tough. Unless, of course, you wait and miss out.

Smart sellers, on the other hand, can benefit from a buyer’s market as well. Successful home sellers in today’s market know they must price their home correctly and be flexible. Providing a buyer with a great deal on their home opens the door for sellers to move on to their own next step — whether it’s moving up, downsizing or relocating. Smart sellers also know what they may give up on price, they can make up — and then some — on their next home purchase. That’s another bright side of today’s real estate market.

Take a moment to learn the seven reasons why it’s a great time to buy a home. And, be sure to contact us when you’re ready to make a move.

1. Loving Low Interest Rates
Historically low interest rates continue to allow home buyers to afford more home for their money. Lower interest rates reduce your monthly payment and increase your buying power. Locking in at a low, fixed-interest rate means your monthly loan payment will never change over the course of your loan.

2. Embracing Investment Property
Even if you’re not in the market to buy a primary residence, you should take a look at the properties available for sale as investments. With ever-increasing numbers of families looking to rent, it’s an opportune time to invest in a rental property. Being a landlord can be a rewarding experience when you find the perfect property.

3. Attractive Home Prices
Home prices have never looked better! Many sellers are motivated to get their homes sold and are pricing accordingly. Don’t be afraid to make an offer on a home or to work with us to negotiate a great price on a great home.

4. Wondrous Selection Of Homes
If your “needs and wants list” of home features can’t be contained, now is the time to be looking at homes. The selection available in our area is outstanding. No matter what your budget, family size or life stage, we can help you find the home that fits.

5. Digging Distressed Properties
Others’ foreclosures, bank-owned and short-sale properties can be the key to your next home. Don’t overlook distressed properties, as you may uncover a hidden gem priced right so you can make upgrades and improvements without breaking your budget. Distressed doesn’t always mean a steal, but it can often lead to a great deal.

6. Engaging Your Financial Options
If you’re tired of seeing your savings yo-yo in the volatile stock market, real estate is a great asset balancer. Consult your financial professional to make sure you have the savings to spare. When you’re ready, we can help you find great investment property or a home to buy for all-cash if you desire.

7. Winning Over Motivated Sellers
Successful sellers keep the market going. Homeowners are eager to sell their homes to buyers who make realistic offers. It’s a crowded market for sellers, but the ones who are motivated will offer a great price and may throw in incentives (e.g., helping with closing costs, etc.) or much-valued sweeteners — such as a home warranty — that are as good as cash.

8. Professional Partner
When you’re buying or selling a home, it’s difficult to go it alone. We can help you every step of the way when it comes to getting a great deal on a new home. Feel free to contact us anytime you’re ready to jump into our real estate market to buy or sell. We’d love to work with you!

Put Your Home’s Equity To Work

With Six Savvy Strategies

Do you have idle equity sitting in your home that could be building wealth instead? One of the great aspects of homeownership is that you increase your wealth every month by building equity in your home and reducing your tax bill at the same time.

After you’ve been in your home a few years, you may have some equity that you could put to work for you. Even if the property has appreciated by just a few percentage points per year, significant equity can build up fairly quickly. Just be sure you retain enough equity that you’ll be able to pay a real estate agent’s commission when you sell the home.

Home equity loans are the most common means of tapping a home’s value. In states where home equity loans are not allowed, however, you can still put your home’s value to work by refinancing it for more than you currently owe–a “cash out” refinancing.

The first way most homeowners think of using their equity is to pay off high-interest debt. That’s one popular option, but you could also invest that equity in other ways. Here are six more ways to put your equity to work for you.

1. Trade Up

Using your equity as a down payment for a larger home could make financial sense. If you’re in a $200,000 home now and it appreciates by 5% each year, your gain is $10,000 for the first year. In five years, that home would be worth $255,256. But in a $275,000 home, that same 5% growth would be $13,750 for the first year. After five years, the more-expensive home would be worth $350,977 — nearly $100,000 more than the less-expensive home.

Of course, you may not be able to count on 5% appreciation every year. It could be higher or lower, depending on the state of the economy and market conditions. Not to worry, though. Even 2% appreciation will still add up over time.

Using additional equity to trade up will allow you to put a significant amount of money down on your next home. That could allow you to own a home you never could afford before.

2. Downsize

Another way to use your equity is to scale down. With the recent changes in tax laws, homeowners may sell a home every two years and walk away with tax-free profits up to $250,000 (for singles) and $500,000 (for married couples). By scaling down, you can purchase a smaller, less-expensive primary dwelling, and use the extra cash for investments, debt reduction or even purchasing an investment property.

3. Second Home

The real estate market has been fueled during the past few years by retiring baby boomers purchasing second homes. Maybe now is the time to purchase that home on the beach, at the lake or in the mountains. We can refer you to a knowledgeable agent in a resort area to help you with this move.

If you know you’re retiring to a particular area in the next few years, study that market now. You may want to buy the home now while prices are still affordable. If you do, you could rent the home during the peak vacation season. Many second homeowners discover they can just about cover their annual property expenses by renting out during peak season.

4. Investment Property

While the stock market often bounces up and down, many investors feel comfortable with the security of real estate. Not everyone has extra money to play the stock market profitably, but landlords can enjoy income every month. The secret is selecting the right property and finding expert property management if you don’t want to manage the property yourself. We can help with both these issues.

Some buyers have found it beneficial to purchase a property in the area where their college-age children are going to school. Their child can help manage the units and share the housing with other students to defray costs. The young adults learn responsibility and property management skills, and you have a live-in manager to watch over your investment.

5. Shared Equity

Another way to put your idle equity to work is to lend it to an adult child as a down payment for his or her first home. Some parents maintain a co-ownership interest while the young adult makes the mortgage payments. At the time of the sale, the equity is then split between the two. This is called a shared-equity arrangement.

6. Remodel

If you really like where you’re living, but desire a few more amenities, consider taking cash out for remodeling or adding to your current home. The interest paid on some home equity loans is tax deductible, just as it is with your first trust. Give us a call to find out what financing options suit your situation best.

Call us, we are the experts with expert partners in mortgage and everything real estate related. 800-497-7325-3607 or kaybaker@ec.rr.com . Sign up for our newsletters and our weekly TGIF Scoop on everything Wilmington NC!

They provide another investment that includes a mortgage-interest tax deduction.

Whether you rent it out or not, you can deduct the mortgage interest as long as you use the home more than 14 days or more than 10% of the number of days the home is rented annually at a fair rental, whichever is longer.

Qualified second homes include houses, condominiums, cooperatives, mobile homes, house trailers, boats or similar properties that have sleeping, cooking and toilet facilities.

Here’s an interesting twist on the mortgage interest deduction: If you take out a home equity loan on your first home and use the funds to acquire your second home, the interest on the home equity loan is also deductible. That’s three mortgage interest deductions off your tax return!

Consult IRS Publication 936 for a complete discussion of how mortgage interest for a second home is deductible.

You can purchase your future retirement home in Wilmington NC now, at today’s prices.

Though your second home may be a vacation home now, if you buy right you can convert it into your principal residence later.

They can produce their own income.

Renting out a second home occasionally or often can help you pay for the property with OPM (other people’s money). Check with your tax advisor about how much of the upkeep and management expenses are deductible against your income.

Buying Tips From The Experts

Buy something within a reasonable distance.

Be sure you can get to your vacation home in a short amount of time. Before you make a final decision, travel the distance on a typical Friday afternoon to see whether the drive will be too much to deal with after a long work week.

Rent in the area several times before you buy.

If you really like a particular area, check it out during different seasons. This way you get to know the climate, people, pests, traffic patterns and other regional particulars first-hand.

Consult other owners.

Check with owners of nearby properties about public and private facilities, special maintenance required due to location or weather, the social climate, local development plans and prevalence of crime. Learning about the lifestyle of the area may help you narrow down your choices.

Think home first, investment second.

Although you may be able to generate rental income from your vacation home, it may not cover your ownership costs. (If you want to try real estate investments, give us a call to look at properties in the Wilmington NC  local area.)

Consider different styles of properties in a vacation area.

To minimize upkeep and have a more secure environment, a condo may be preferable to a single-family home. If you plan on converting it to a retirement home, consider what type of home you’ll want as a full-time residence.

Here are some of the current Wilmington NC real waterfront/waterview real estate  in our area.

Priced from 100,000 – 200,000  Click here

Priced from 200,000- 400,000  Click here

Priced from 400,00 -600,000  Click here

Priced from 600,000 – Click here

To search all properties please visit www.cbbaker.com

The Cost of Living Index measure differences in costs of services and consumer goods for middle class standard of living.  314 urban areas in the US participated in the study.  The study is conducted over a 3 day period, covering 90,000 prices of 60 different items.   The Greater Wilmington Chamber of Commerce posted the following chart detailing the scores compared to other Southern cities.

Click on chart for larger view.

Considering a home with a loan amount of $220,000 at today’s rate of 4.25% for a 30 yr. fixed loan.  The payment for that loan amount at 4.25% would be $983.87. If you wait, and  the rates were to go back to the April 2010 level of 5% , the same payment of $983.87 would only allow you to borrow $201,605.14. You have lost $18,395.00 in purchasing power.
This does not even take into consideration that the market should be improving and the price of the home you want could be increasing.
Most will say it will take a while for the rates to return to 5%. But remember, that it was only in April of this year that they were at 5%,  rates increase twice as fast as they decrease.

Information furnished by Daniel Downing Prime Lending Wilmington NC 538-6473.

Loan Amount    Rate        Payment        Rate    Loan Amount
9/24/10                4/23/10
$200,000.00    4.25%        $983.87        5.00%    $183,276.00
$210,000.00    4.25%        $1,033.07        5.00%    $192,441.95
$220,000.00    4.25%        $1,082.26        5.00%    $201,605.14

4/23/10                9/24/10
$200,000.00    5.00%        $1,073.64        4.25%    $218,246.83
$210,000.00    5.00%        $1,127.32        4.25%    $229,159.11
$220,000.00    5.00%        $1,181.00        4.25%    $240,071.51

Listing Inventory
In August we saw a decrease in homes for sale of 37 units. We are about 131 units over September 1, 2009. We have 5,567 single family homes for sale in our Wilmington MLS. The average list price of $374,121 is down by $2,931 from last month. The average list price has decreased by 6.9% from September 1, 2009.

Monthly Average Sold Price
Our monthly average sold price is up by .01% from last month and up 1.9% from August 2009. Our average sold price is up by $2,252.00 from last month. August average sold price ($238,258) shows an increase of 1.7% from year end 2009. Our average sold price is up by $4,369 over last August.

Monthly Sold Units
This month’s decline in the number of homes sold when compared to previous year is only down 3 units. The number of sold homes is up 7.8% from last month and down .01% from August 2009. Last month we had 358 sold units and this month 386 sold units, last year in August we had 390 sold units. Due to the First Time Home Buyer increase in sales, a lot of these sales were pushed up and people that might have been planning to buy in July and August moved up their purchase to coincide with the tax credit. I think we are just getting ready to come out see our sales pick back up to a normal level.

Average Sold Price Year to Date
Year over year our year to date numbers have dipped a little.
2003 year end average sale price $ 186,137
2004 year end average sale price $ 210,048
2005 year end average sale price $ 254,080
2006 year end average sale price $ 264,498
2007 year end average sale price $ 273,408
2008 year end average sale price $256,498
2009 year end average sale price $234,379
2010 year to date average sale price $229,073
While our current year to date numbers are lower than Year End 2009 they do show promising signs that our sales are on the upswing. The first eight months of 2010 has a 363 sold unit gain over first eight months of 2009. The average sales price is down 1.5% for the first eight months of 2010 than the first eight months of 2009. Our median sales price is just 1.2% behind 2009.

Rolling 12 months
Another bright spot is the rolling 12 month numbers. When we look at September 1st, 2009 to August 31th, 2010 we have 4,731 sold units and when we compare September 1st, 2008 to August 31th, 2009 we have a 727 unit gain (4,004 sold units). When we look at the same rolling 12 months for average sold price we see that we are only down by 1.9%. So the dates of 9/1/2009 to 8/31/2010 we have an average sold price of $231,880 while from 9/1/2008 to 8/31/2009 we had an average sold price $236,367.
Median Sold Price
Our Median sold price is up 2.0% from last month, about $193,327. While we have not dipped as low as the National Median we seem to have turned the corner while the national median is showing a slight increase. I would anticipate over the next couple of months to continue to see this median increase.

Pending
Pending Sales – A sale is listed as pending when the contract has been signed but the transaction has not yet closed. Sales are typically finalized within one to two months from signing. I look at the total pending units on a regular basis and this is how they chart out. We saw our peak pending numbers about May 3rd. We are actually down 4.1% from last month and we are down just 21.6% from September 11, 2009. With the tax credit benefits expired it will be interesting to see if our sales can improve going into late summer and early fall.

Market Absorption rate – The number of homes sold in July, 386 divided by the current listing inventory, 5,567 gives us a 14.4 month supply of single family homes. This decreased by 2.0 months from last month. We need to get this inventory back under 12 months. With rates where they are and plenty of inventory; we can get this number down.
List to Sold price ratio – the average list price of the sold properties is $254,579 and the average sold price is $238,257 for August which gives us a 93.6% list to sold price ratio – a decrease of 1.2% from last month. We have now managed to stay under 95% for over a year.
Seller Concessions – We had 24.1% of sold properties report a sales concession for August, an increase of 2.4%. We want this number to go lower.
Days on Market – The average days on market for the sold properties is now at 135 for August. That is about 4.5 months to keep a property on the market. Only 13.0% of the properties were placed under contract in less than 15 days for the month of August.
Carolina & Kure Beach
There are currently 485 single family homes for sale and this represents a 14 unit decrease over September 1, 2010 and 8.7% of our total WRAR inventory. The average list price is $411,327 and decrease of about $13,672 from August. In August there were 31 homes sold, divide that by the homes available and you have a 15.6 monthly supply of homes in Carolina and Kure Beach. The average sold price for the month of August was $273,731 and is up $1,119 from last month. When we look at our rolling 12 months September 1, 2009 to August 31, 2010 we have 328 homes sold at an average price of $287,459. While September 1, 2008 to August 31, 2009 we had 242 homes sold at an average price of $318,107.
This data was pulled on September 12, 2010, based on information from the Wilmington Regional Association of REALTORS Incorporated, for the period Jan. 1, 2005 through August 31, 2010.
The Market
Mortgage rates finished mixed this week, according to Freddie Mac weekly survey
McLean, VA – Freddie Mac released the results of its Primary Mortgage Market Survey. While the 30-year fixed-rate mortgage rate and the 5-year adjustable rose slightly, other rates remained flat or fell lower.
News Facts
30-year fixed-rate mortgage (FRM) averaged 4.35 percent with an average 0.7 point for the week ending September 9, 2010, up from last week when it averaged 4.32 percent. Last year at this time, the 30-year FRM averaged 5.07 percent.
15-year FRM this week averaged a record low of 3.83 percent with an average 0.6 point, unchanged from last week when it also averaged 3.83 percent. A year ago at this time, the 15-year FRM averaged 4.50 percent.

This quote is from WWAY 3 from the president of Homebuilders “The possibility of homeownership is more obtainable for buyers in our market now than it has been for years,” said WCFHBA President John Lancaster of Venture Homes of the Carolinas. “More buyers are beginning to enter the market again thanks to renewed confidence as housing prices stabilize while the fed maintains all time low interest rates.”

Syracuse NY held the top spot on most affordable homes, with some smaller housing markets following close by Mansfield, Ohio; Bay City, Mich.; Monroe, Mich.; and Lansing-East Lansing, Mich.  Lancaster says “Our market is greatly influenced by what happens up north, so the numbers out of places like New York, Pennsylvania and Ohio are encouraging,”. 

That is encouraging news when the news lately has not been so positive.

Please take a minute to tour our website and search the Wilmington NC real estate area to find the house, neighborhood and price that you are looking for.  We have an inhouse Lender – Alpha Mortgage and an inhouse Insurance Agency – Real Mark Insurance and would be happy to give you contact information so that you have a “One Stop” Shop to buy real estate.   We make it easy for you.  Coldwell Banker Sea Coast Realty and Kay Baker and Associates.  Search all Wilmington NC real estate on www.cbbaker.com

Monthly Average Sold Price
Our monthly average sold price is down by .03% from last month and up 8.4% from July 2009. Our average sold price is down by $707.00 from last month. July average sold price ($237,467) shows an increase of 1.3% from year end 2009. Our average sold price is up by $18,501 over last July.

Monthly Sold Units
This is the first monthly decline in the number of homes sold in Wilmington, NC when compared to previous year. The number of sold homes is down 32.3% from last month and down 22.2% from July 2009. Last month we had 517 sold units and this month only 350 sold units, last year in July we had 450 sold units. Due to the First Time Home Buyer increase in sales, a lot of these sales were pushed up and people that might have been planning to buy in July moved up their purchase to coincide with the tax credit.

Average Sold Price Year to Date
Year over year our year to date numbers have dipped a little.
2003 year end average sale price $ 186,137
2004 year end average sale price $ 210,048
2005 year end average sale price $ 254,080
2006 year end average sale price $ 264,498
2007 year end average sale price $ 273,408
2008 year end average sale price $256,498
2009 year end average sale price $234,379
2010 year to date average sale price $227,930
While our current year to date numbers are lower than Year End 2009 they do show promising signs that our sales are on the upswing. The first seven months of 2010 has a 358 sold unit gain over first seven months of 2009. The average sales price is down 1.9% for the first seven months of 2010 than the first seven months of 2009. Our median sales price is just 1.7% behind 2009.

Rolling 12 months
Another bright spot is the rolling 12 month numbers. When we look at August 1st, 2009 to July 31th, 2010 we have 4,725 sold units and when we compare August 1st, 2008 to July 31th, 2009 we have a 684 unit gain (4,041 sold units). When we look at the same rolling 12 months for average sold price we see that we are only down by 3.6%. So the dates of 8/1/2009 to 7/31/2010 we have an average sold price of $231,630 while from 8/1/2008 to 7/31/2009 we had an average sold price $240,403.
Median Sold Price
Our Median sold price is up 1.6% from last month, about $189,950. While we have not dipped as low as the National Median we seem to have turned the corner while the national median is showing a slight increase. I would anticipate over the next couple of months to continue to see this median increase.

Pending
Pending Sales – A sale is listed as pending when the contract has been signed but the transaction has not yet closed. Sales are typically finalized within one to two months from signing. I look at the total pending units on a regular basis and this is how they chart out. We saw our peak pending numbers about May 3rd. We are actually up 6.3% from last month and we are down just 12.5% from August 16, 2009. With the tax credit benefits expired it will be interesting to see if our sales can improve going into late summer and early fall.

Market Absorption rate – The number of homes sold in July, 350 divided by the current listing inventory, 5,604 gives us an 16.0 month supply of single family homes. This increased by 5.0 months from last month. We need to get this inventory back under 12 months. With rates where they are and plenty of inventory; we can get this number down.
List to Sold price ratio – the average list price of the sold properties is $250,624 and the average sold price is $237,467 for July which gives us a 94.8% list to sold price ratio – a increase of .4% from last month. We have now managed to stay under 95% for over a year.
Seller Concessions – We had 21.7% of sold properties report a sales concession for July, an decrease of 8.7%. We want this number to go lower.
Days on Market – The average days on market for the sold properties is now at 121 for July. That is about 4 months to keep a property on the market. Only 17.7% of the properties were placed under contract in less than 15 days for the month of July.
Carolina & Kure Beach
There are currently 499 single family homes for sale at Carolina and Kure Beaches and this represents an 17 unit decrease over July 1, 2010 and 8.9% of our total WRAR inventory. The average list price is $424,999 an increase of about $6,474 from July. In July there were 42 homes sold, divide that by the homes available and you have a 11.8 monthly supply of homes in Carolina and Kure Beach – this is by far our best monthly supply level in a long time. The average sold price for the month of July was $272,612 and is down $83,634 from last month. When we look at our rolling 12 months August 1, 2009 to July 31, 2010 we have 317 homes sold at an average price of $289,532. While August 1, 2008 to July 31, 2009 we had 242 homes sold at an average price of $322,450.
This data was pulled on August 14, 2010, based on information from the Wilmington Regional Association of REALTORS Incorporated, for the period Jan. 1, 2005 through July 31, 2010.

Compliments of David Flory NMLS #91592

Mortgage Consultant
Cunningham & Company Mortgage Bankers
910-352-8273 cell
910-313-0045 office
davidf@cunninghammortgage.com
www.cunninghammortgage.com

Rendering by Creative Illustration Media, INC. LS&P Architects

Wilmington NC is going to get it’s own state of the art  Convention Center.  After waiting for approvals and site plans, an opening date has been set for the Historic Downtown Wilmington Convention Center on the Cape Fear River. 

The grand opening is set for Thursday January 13, 2011 at 9:30 am.  The public is invited and there will be a ribbon cutting ceremony with the mayor and other community leaders.  Following the ceremony, there will be a BizTech Expo with technology and business vendors.  On January 15 a black tie event will be held by the Greater Wilmington Chamber of Commerce, with proceeds benefiting the Cape Fear Future initiative.  

A couple of big companies have signed contracts to hold their conventions here for the next couple of years.  This will bring added revenue to Wilmington NC and expose our area and all it’s natural treasures and great Wilmington NC real estate opportunities.  

Please explore our website for the most up to date listings of all Wilmington NC real estate and waterfront properties.  www.cbbaker.com or call us and we will personally select properties that will fit your real estate needs or portfolio.

To view the home pictured please visit www.AskMeAboutWilmington.com