President Obama just signed in to law an extension to the First Time Homebuyer Tax Credit and an additional Home Owner “Extended” Tax Credit of up to $6500 for an existing homeowner. A great resource for explaining the opportunities under this credit can be found by clicking this link.
Bottom line, there will be opportunity for tax credits on a home purchase from now until April 30, 2010. This would be a great time to get out and start looking as well as getting your current home on the market!
Categories: 53703 · Market Data
Wisconsin ninth in median property taxes
New data released by the Census Bureau show that Northeast homeowners and those in the Midwest tend to pay the most in property taxes, with Wisconsin ranking ninth among the top 10 states, a nonprofit tax research group based in Washington, D.C., said Tuesday.
See the rest of the Wisconsin State Journal Story by clicking here.
Categories: 53703 · Downtown Living · Market Data
Darren Kittleson, broker and Operating Principal for Keller Williams Realty Madison West/Madison Crossroads was recently named a finalist in the National Association of REALTORS (NAR) Center for Technology Advocate award category. Kittleson was nominated by his peers for his willingness to go above and beyond the call of duty to reach out and engage people with the information and knowledge he has about technology. He does this with no regard to compensation, and for the most part, has reached across ‘brokerage’ boundaries to help and instruct. He is being recognized as one of the individuals that is making changes in the industry one person at a time.
For the list of nominees, visit this link.
Categories: 53703 · Downtown Living · Market Data
Categories: 53703 · Downtown Living · Market Data
The Home Valuation Code of Conduct (Code) announced by Fannie Mae and Freddie Mac (Enterprises) in December 2008 was developed after a long period of public input and was deployed on May 1, 2009, after a four-month transition period. The Code expanded on existing Enterprise appraisal standards, seeking to redress problems that contributed to the current mortgage crisis and to improve the quality of the mortgage loans they purchase.
Unfortunately, during the 2005 to 2007 period, mortgage lending was much too aggressive and placed pressure on the appraisal process. In some cases, that resulted in unrealistically high appraisals, hurting homebuyers as well as investors. The HVCC is designed to promote professional appraisals free from inappropriate pressure from lenders, borrowers or brokers.
The Code’s main purpose is to protect appraisers and the quality of appraisals from undue influence and conflicts of interest. The Enterprises continue to address questions on implementation and today provided additional FAQs. Also, they are finalizing a complaint form relating to Code violations.
Market participants should appreciate the difficulty facing appraisers when valuing properties in a declining market, especially when sharply dropping home prices and foreclosures are prevalent. The challenges of appraising properties exist with or without the Code. Market participant concerns in the current circumstances would create appraisal controversies even without the Code. Indeed, the Code should help mitigate these controversies by providing clearer protection for appraisers.
The Enterprises have taken additional actions. For example, Freddie Mac recently issued an alert to mortgage lenders advocating the use of qualified and experienced real estate appraisers, including those appraisers affiliated with a professional organization. This was similar to a Fannie Mae pronouncement. The Appraisal Institute termed this a victory for efforts to promote more professional appraisals and said it would “have a positive effect on millions of home buyers and sellers.” The GSE guidances reinforce existing professional standards that appraisers must be familiar with the local market where the property is located and highlighted that appraisers must choose appropriate sales comparisons.
Addressing Misinformation
Misinformation has been circulated about the content of the Code and some have tried to cite the Code as the source of unrelated market dislocations. FHFA believes that the Code is serving the intended purpose and will continue its oversight role both as to the implementation of the Code by the Enterprises and its market impact.
Some key items that the public should know:
Communications with appraisers– Contrary to some suggestions, the Code provides for communications with appraisers about errors, additional needed information and unprofessional conduct. Quality control personnel may communicate with appraisers and other lender personnel, outside of the loan origination function. The real bar is on communications that seek to influence the appraiser to adopt a set valuation, which is prohibited.
Low appraisals— Contrary to some suggestions, the Code does not lead to lower appraisals for property. The Code insulates appraisers from pressures that led to higher or lower appraisals and should now lead to more accurate valuations. This is in everyone’s interest. Declining home prices began long before the deployment of the Code and relate to many other factors. Current efforts at mortgage market stabilization are a central focus at FHFA and the Enterprises, but that needs to be achieved by keeping borrowers in their homes, not urging appraisers to improperly overvalue homes.
Appraisal management company (AMC) role— Contrary to some suggestion, the Code does not favor the use of AMCs over independent or in-house appraisers. Significantly, for the first time, the Code places the same requirements for appraiser independence on AMCs as the limits placed on lenders. Lender use of AMCs was increasing prior to the Code and one of the key goals and results of the Code was to strengthen appraiser protections when engaged by AMCs.
Unqualified or out-of-area appraisers– The Uniform Standards of Professional Appraisal Practice (USPAP) requires that an appraiser be competent and knowledgeable of the local market to perform an appraisal. In addition, in reinforcing USPAP, the Enterprise appraisal guides require appraisers to have knowledge of the local market. The use of unqualified in-state or out-of-state appraisers, unfamiliar with local conditions, should be reported to state appraiser licensing agencies.
Increased costs at closing— Closing costs have risen in some instances, but that has not been a function of the Code. Lenders have tightened underwriting standards, often requiring additional comparables by appraisers and even requiring second appraisals. Market investors have focused on reducing fraud and sought greater assurances about valuations. Appraisers have been working hard to meet these requests.
Turnaround times for appraisals— The Code may initially have slowed appraisal time as it was being implemented. However, there are other reasons for turnaround time changes; these include increased demands by lenders, the efficiency of a particular lender’s underwriting process and the workload of appraisers. The Code’s appraiser independence standards are critical for accurate valuations, a lesson learned in the current market crisis. Assuring a good appraisal is in the borrower’s interest. As the market adjusts to new underwriting standards, including those for appraisals, more efficiency will reduce turnaround times.
Transferring an appraisal – Contrary to some suggestions, appraisals are transferrable between lenders under the Code. Transferring an appraisal may obviate the consumer’s need to pay for a new appraisal should the first lender deny the loan. Whether a lender decides to transfer or
accept an appraisal, however, is up to the lender, and is not related to the Code. Lender discretion in this area predated the Code.
Categories: 53703 · Downtown Living · Market Data
This past week my team closed on a listing we took in late April. What’s extraordinary in that? At first blush absolutely nothing. In fact getting a buyer and seller to closing is part of what we get paid to do in this business.
At the closing table both Buyer and Seller were very amicable with each other. In fact the Buyers are moving to Madison from the area of the country the Seller is moving back to. They even discovered they know some of the same people. (Small world).
Anyway at closing I was thinking. This house was 82 years old. This new Buyer is going to be the 4th family to own this house. Other than when the original owner built the house in the 1930’s and subsequently lived in it for 60+ years, I’ve been involved in EVERY SALE of the HOUSE since then! That’s right. When the original Owner’s estate had it for sale, I was working with a buyer who wanted that neighborhood. The house came up for sale through the trust department of one of our local banks. I got my Buyer’s through the house right away. They liked it but being 1st time homebuyers, were hesitant as to all the delayed maintenance the home displayed from years of an elderly homeowner living there. The price was more than right and they finally pulled the trigger.
That was 1998. They lived in the house until 3 years ago. During that time they did wonderful restoration to the home including adding a new kitchen, peeling off the masonite siding and residing with a “shingled” effect (perfect for the cottage style of the house). They also furnished it incredibly well and added a 1/2 bath to the main floor.
When it came time for them to move on, they called us to list the home. The 2nd day after it was placed on the market, Devery (my team member) and I were at the home staging it for the virtual tour pictures. There was as car eerily stopped out in the street in front of the house. The “For Sale” sign had just been place minutes before. My cell phone rang and it was an agent from one of our local companies. She stated she had out of town buyers who were sitting in front of the house at that moment and wanted to see it. She was with other clients and couldn’t get there at that moment, would we be willing to show it to them? We said of course and proceeded to meet the buyer and his mother.
He was just back from deployment and coming to Madison for law school. He fell in love with the house and a full price offer was faxed to us before the day was over.
That was 3 years ago. This spring, this owner called us to discuss listing the house for him. He was finishing up law school and had gotten married. His next stage in life and new wife were already living on the west coast. We placed the home on the market slightly higher priced than almost everything else in the neighborhood. That was Thursday and by Saturday, darned if we didn’t receive a full price offer from the 1st showing.
That’s the closing that occurred this past week. So there you have it, 1 house, 82 years, 4 owners, 3 sales for our team.
My question is this–What is it about some houses that they sell so quickly?
Categories: 53703 · Downtown Living · Market Data
Date: May 12, 2009
MADISON, WI – Wisconsin home sales and median prices both fell in the first quarter of 2009 compared to that same quarter last year according to data just released by the Wisconsin REALTORS® Association (WRA). The lingering national recession caused unemployment in Wisconsin to increase significantly during the first three months of the year, resulting in the housing market drop, according tot he WRA. “The housing market doesn’t operate in a vacuum,” said Michael Mulleady, Chairman of the Board of the WRA. “The national economic environment drives Wisconsin’s economy and that in turn drives our housing market.” Mulleady noted the national economy shrank by more than 6 percent in the first quarter, causing Wisconsin’s unemployment rate to jump from 5.9 percent in December 2008 to 8.5 percent in March 2009.
Click here for the rest of story….
See what’s happened in Dane County Wisconsin by clicking here….
Categories: 53703 · Downtown Living · Market Data
There’s a pretty intricate process we go through when we work through a short sale to a successful closing. Not only do we have to get agreement from any underlying mortgage holders but quite often there may be judgements and liens against the property that have to be released in order to close on the property.
I had that issue today. Got an accepted offer, got the lender to agree to a reduced pay off in order to close. There were 6 outstanding liens against this seller,thus then tied to the property. I got on the phone last week and started contacting the lien holders. I negotiated, on behalf of the seller, to get releases from each of these lien holders in order to be able to close today.
I received verbal acceptance from each on the terms and conditions that would allow us to close. I sent release agreements to each. I received them signed by the lien holder on every one but 1. Today, 1 week after they verbally agreed to a payoff of some dollars to release their lien rights on this property, they decided it wasn’t enough money. They refused to sign the release and thus the closing didn’t occur.
Here’s where this gets frustrating. You see the property is in the process of being foreclosed upon. Once the foreclosure happens, chances are this lien holder, being in 7th position in the line, will not see any dollars for their position.
I was able to get them some payment at this point had they released their lien rights today.
We got the buyer and seller to agree to a 1 week extension. I’m hopeful reason will prevail over the weekend and the lien holder will answer their phone on Monday and agree to the release.
Never a dull moment.
Categories: 53703 · Downtown Living · Market Data
Categories: 53703 · Downtown Living · Market Data
Under the American Recovery and Reinvestment Act of 2009, qualifying taxpayers who purchase a home before Dec. 1 receive up to $8,000 or $4,000 for married individuals filing separately. The IRS recently released additional information to help homebuyers understand the ways they can file to claim the $8,000 first-time homebuyer credit for 2009 home purchases.
For people who recently purchased a home (closed or took up residence in new construction) or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they’ve already filed their tax return. The Treasury Department encourages taxpayers to explore these options to maximize their credit and get their money back as fast as possible. “The new credit can get money in the pockets of first-time homebuyers quickly,” said IRS Commissioner Doug Shulman.
People can claim the credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year. The filing options to consider are:
1. File an extension. Taxpayers who haven’t yet filed their 2008 returns but are buying a home soon can request a six-month extension to October 15. This step would be faster than waiting until next year to claim it on the 2009 tax return. Even with an extension, taxpayers could still file electronically, receiving their refund in as few as 10 days with direct deposit.
2. File now, amend later. Taxpayers due a sizable refund for their 2008 tax return but who also are considering buying a house in the next few months can file their return now and claim the credit later. Taxpayers would file their 2008 tax forms as usual, and then follow up with an amended return later this year to claim the homebuyer credit.
3. Amend the 2008 tax return. Taxpayers buying a home in the near future who have already filed their 2008 tax return can consider filing an amended tax return. The amended tax return will allow them to claim the homebuyer credit on the 2008 return without waiting until next year to claim it on the 2009 return.
4. Claim the credit in 2009 rather than 2008. For some taxpayers, it may make more financial sense to wait and claim the homebuyer credit next year when they file the 2009 tax return rather than claiming it now on the 2008 tax return. This could benefit taxpayers who might qualify for a higher credit on the 2009 tax return. This could include people who have less income in 2009 than 2008 because of factors such as a job loss or drop in investment income.
The IRS reminds taxpayers the amount of the credit begins to phase out for taxpayers whose modified adjusted gross income is more than $75,000, or $150,000 for joint filers. Taxpayers can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.
IRS.gov provides more information, including guidance for people who bought their first homes in 2008. To learn more about the overall implementation of the Recovery Act, visit www.Recovery.gov.
From the IRS news release IR-2009-27: http://www.irs.gov/newsroom/article/0,,id=205416,00.html
Categories: 53703 · Downtown Living · Market Data
Central Madison Living
