Bay Farm Island
Alameda is a small island with a beach that looks to San Francisco. Bay Farm Island is where I grew up and in those days we took a school bus to school, AC transit did not run on the weekends, I took the ferry (the kind that carries vehicles) to San Francisco when I went to the doctor and Bay Farm Island had 3 streets with homes and the rest was the bay and farmland. Right behind Bay Farm Island was a very small airport (Oakland Airport) and now it too has grown! There were no schools and only 1 park. Where the Oakland Raider's headquarters are now, it was the bay.
Bay Farm Island is an area of the city of Alameda, California , near Oakland . It is divided from the main island of Alameda by an estuary and connected by separate drawbridges for both cars and bicycles. Bay Farm Island is adjacent to the Oakland International Airport . In addition to being an affluent neighborhood, it is also the location of a municipal golf course, a high-tech industrial park, a small shopping center and the world headquarters of the NFL football team, the Oakland Raiders.
Also located on BayFarm Island are two public elementary schools: Bay Farm and EarhartElementary Schools. The former is named for the island community that it serves. The latter is named for famed female aviator Amelia Earhart who started many of her flights from the nearby Oakland Airport.
An interesting point to note is that Alameda was once a peninsula and was later divided from the mainland to create an island , while BayFarmIsland was once an island, later to become a peninsula through land reclamation , adjacent to the Oakland Airport.
Once used as farmland, Bay FarmIsland is now home to a the 36-Championship Hole Chuck Corica Golf Complex in addition to its many housing developments. The land mass boasts a chain of lagoons as well as several parks including Shoreline Park, Leydecker, Godfrey, Harrington Field and a greenbelt that surrounds Bay Farm's perimeter.
Wow! Has my town changed!
Showing posts with label Alameda Homes. Show all posts
Showing posts with label Alameda Homes. Show all posts
Wednesday, March 26, 2008
Thursday, March 13, 2008
Best Time to Purchase a Home in 4 Years!
Best Time to Buy in 4 Years
Home values have declined across the country, giving homebuyers the best buys they've had since 2004.
NEW YORK (CNNMoney.com) -- It may be the best time to buy a house in more than four years.
Home prices have dropped so quickly and so far that valuations - the difference between what a home should cost and its actual price - are the lowest they've been since 2004, according to a report.
The Cleveland-based bank National City Corp. (NCC, Fortune 500), together with financial analysis firm Global Insight, revealed Tuesday that more than 88% of the 330 housing markets surveyed showed price declines and improved affordability during the last three months of 2007.
Housing rescue: What you need to know
"Housing valuations are almost back to long-term norms," said National City's chief economist, Richard DeKaser. He called current affordability "the best in the past four years."
But DeKaser cautioned that home prices could fall even further.
"This isn't to say home price declines are over," he said. "We could move below historic norms. By the end of 2008, housing markets could be broadly under valued."
Prices still improving
There are still 21 housing markets, or 6% of those surveyed, that are severely over valued, including Atlantic City and Madera, Calif. That's down from 56 overvalued markets at the peak of the housing bubble in 2006.
The report compares actual median home prices with what the authors determine are proper home values based on population density, relative income levels and interest rates, as well as historically observed market premiums or discounts, to determine whether markets are over or under valued.
The report also factors in market intangibles that make some areas more desirable places to live, and more expensive.
"Declines are no longer confined to once-frothy markets," said DeKaser.
The survey covered home valuations during the last three months of 2007, but DeKaser pointed out there's reason to believe that valuations are even more favorable for buyers today.
Price declines have continued into 2008 and interest rates, although they have inched up lately, have been steady or lower compared to late last year. There have even been wage gains; personal income rose 0.5% in December. Soaring foreclosure rates have added inventory to many housing markets, depressing home prices further.
The biggest gains in affordability occurred in California, Michigan and Florida, which are areas that have also been some of the hardest hit by foreclosures. Those states registered 43 of the 50 biggest price declines.
Bend, Ore. currently tops the overvaluation list. Home prices there were judged to be about 59% higher than their fair-market value. Miami, despite a median home price decline of 5.7% last year, is the most overvalued big city, by 44%.
All the best bargains were found in Louisiana and Texas. Houses in Houma, La. were under valued by 31.2%, according to the report. Dallas was the most undervalued big city, by 30%.
Compliments of CAR Market Matters
Home values have declined across the country, giving homebuyers the best buys they've had since 2004.
NEW YORK (CNNMoney.com) -- It may be the best time to buy a house in more than four years.
Home prices have dropped so quickly and so far that valuations - the difference between what a home should cost and its actual price - are the lowest they've been since 2004, according to a report.
The Cleveland-based bank National City Corp. (NCC, Fortune 500), together with financial analysis firm Global Insight, revealed Tuesday that more than 88% of the 330 housing markets surveyed showed price declines and improved affordability during the last three months of 2007.
Housing rescue: What you need to know
"Housing valuations are almost back to long-term norms," said National City's chief economist, Richard DeKaser. He called current affordability "the best in the past four years."
But DeKaser cautioned that home prices could fall even further.
"This isn't to say home price declines are over," he said. "We could move below historic norms. By the end of 2008, housing markets could be broadly under valued."
Prices still improving
There are still 21 housing markets, or 6% of those surveyed, that are severely over valued, including Atlantic City and Madera, Calif. That's down from 56 overvalued markets at the peak of the housing bubble in 2006.
The report compares actual median home prices with what the authors determine are proper home values based on population density, relative income levels and interest rates, as well as historically observed market premiums or discounts, to determine whether markets are over or under valued.
The report also factors in market intangibles that make some areas more desirable places to live, and more expensive.
"Declines are no longer confined to once-frothy markets," said DeKaser.
The survey covered home valuations during the last three months of 2007, but DeKaser pointed out there's reason to believe that valuations are even more favorable for buyers today.
Price declines have continued into 2008 and interest rates, although they have inched up lately, have been steady or lower compared to late last year. There have even been wage gains; personal income rose 0.5% in December. Soaring foreclosure rates have added inventory to many housing markets, depressing home prices further.
The biggest gains in affordability occurred in California, Michigan and Florida, which are areas that have also been some of the hardest hit by foreclosures. Those states registered 43 of the 50 biggest price declines.
Bend, Ore. currently tops the overvaluation list. Home prices there were judged to be about 59% higher than their fair-market value. Miami, despite a median home price decline of 5.7% last year, is the most overvalued big city, by 44%.
All the best bargains were found in Louisiana and Texas. Houses in Houma, La. were under valued by 31.2%, according to the report. Dallas was the most undervalued big city, by 30%.
Compliments of CAR Market Matters
Sunday, March 2, 2008
"Are You Over 55? Do You Want to Transfer Your Property Tax Base in California?,"
In California Proposition 13 prohibits property tax increases until property ownership is changed.
If either spouse is over age 55 (when the old home is sold), PROP 60 allows replacement of a primary residence with a new home of equal or lesser value (but see below) within the same county and transfer of the Prop 13 assessed valuation from the old home to the new property. This is allowed once in your lifetime, if a spouse has done it before then the other spouse is prohibited from transferring his or her base.
PROP 90 allows counties to elect to accept transfers of Prop 13 values for moves from other counties when a primary residence is replaced with a less expensive (but see below) home. If you are over 55 and move into a county which accepts Prop 90, you may take your old, lower Prop 13 value, regardless of from which county you move.
Using Prop 90, you can sell your $400,000 Alameda home [assessed value $80,000] and move to a new $300,000 home in Alameda and the new Alameda assessed value will be $80,000!
7 COUNTIES WHICH ACCEPT PROP 90 (Current as of 6/1/2005)
*Alameda, *Los Angeles, *Orange, *San Diego, *San Mateo, *Santa Clara, and *Ventura. accept Prop 90. Contra Costa, Inyo, Kern, Riverside, Modoc, Monterey, and Marin have dropped out of the Prop 90 program.
Props 60 and 90 apply if you purchase a home at an equal or lesser value than your old home.
If you purchase the New Home First then sell the Old Home, you must go down price.
If you sell the Old Home first then buy the New Home:
• In the first 365 days after the sale of Old Home, you may go up 5% in the purchase price of New Home.
• If you buy New Home more than 1 year from the sale of Old Home, but less than 2 years, you may go up 10%.
Some buyers can pay the commission outside of escrow to lower to sales price.
This information is not intended as legal advice, or guaranteed accurate or complete. Specific situations may differ. Contact your attorney and/or county for information regarding any particular situation.
Ready to select a REALTOR®….I am here to help! Toll Free: 800.378.7300
http://www.jeansellsdreams.com/Listing/VirtualTour.aspx?ListingID=1148835
Jean Powers
Broker Associate, CRS, ASP, LTG, PMN, SRES
Windermere Welcome Home
925.824.4827
Toll Free: 800.378.7300
Homes@JeanPowers.com
http://JeanSellsDreams.com
Please Remember .... I am never too busy for your referrals!
Ask the REALTOR® if he or she is a Broker?
If either spouse is over age 55 (when the old home is sold), PROP 60 allows replacement of a primary residence with a new home of equal or lesser value (but see below) within the same county and transfer of the Prop 13 assessed valuation from the old home to the new property. This is allowed once in your lifetime, if a spouse has done it before then the other spouse is prohibited from transferring his or her base.
PROP 90 allows counties to elect to accept transfers of Prop 13 values for moves from other counties when a primary residence is replaced with a less expensive (but see below) home. If you are over 55 and move into a county which accepts Prop 90, you may take your old, lower Prop 13 value, regardless of from which county you move.
Using Prop 90, you can sell your $400,000 Alameda home [assessed value $80,000] and move to a new $300,000 home in Alameda and the new Alameda assessed value will be $80,000!
7 COUNTIES WHICH ACCEPT PROP 90 (Current as of 6/1/2005)
*Alameda, *Los Angeles, *Orange, *San Diego, *San Mateo, *Santa Clara, and *Ventura. accept Prop 90. Contra Costa, Inyo, Kern, Riverside, Modoc, Monterey, and Marin have dropped out of the Prop 90 program.
Props 60 and 90 apply if you purchase a home at an equal or lesser value than your old home.
If you purchase the New Home First then sell the Old Home, you must go down price.
If you sell the Old Home first then buy the New Home:
• In the first 365 days after the sale of Old Home, you may go up 5% in the purchase price of New Home.
• If you buy New Home more than 1 year from the sale of Old Home, but less than 2 years, you may go up 10%.
Some buyers can pay the commission outside of escrow to lower to sales price.
This information is not intended as legal advice, or guaranteed accurate or complete. Specific situations may differ. Contact your attorney and/or county for information regarding any particular situation.
Ready to select a REALTOR®….I am here to help! Toll Free: 800.378.7300
http://www.jeansellsdreams.com/Listing/VirtualTour.aspx?ListingID=1148835
Jean Powers
Broker Associate, CRS, ASP, LTG, PMN, SRES
Windermere Welcome Home
925.824.4827
Toll Free: 800.378.7300
Homes@JeanPowers.com
http://JeanSellsDreams.com
Please Remember .... I am never too busy for your referrals!
Ask the REALTOR® if he or she is a Broker?
Friday, February 29, 2008
More About Mortgage Debt Relief Act of 2007
TAX RELIEF FOR SHORT SALES
As many of you may know, one of the big impediments to short sales was the fact that the taxpayer would be charged with ordinary income for any debt which was forgiven by a lender in the short sale. So the taxpayer might get out from under the property but was left with a big income tax bill. The long awaited tax relief from this provision has now been signed into law. On December 20, 2007, President Bush signed into law the Mortgage Forgiveness Debt Relief Act of 2007 (H.R. 3648) which greatly reduces the negative tax implications of a short sale if the debt being forgiven meets certain criteria. Under this new law, there is a permanent exclusion for discharges of debt of up to $2,000,000 (which was forgiven by the lender after January 1, 2007) if the debt was secured by a principal residence and was incurred in the acquisition, construction or substantial improvement of the principal residence. Instead of including the amount forgiven as income, the basis of the individual's principal residence will be reduced by the amount excluded under the bill. This new law does not change existing law as it relates to forgiveness of a debt which was used for purposes other than acquisition, construction or improvement. So lines of credit and home equity loans which were used for paying off credit cards, buying second homes, boats, etc. will still be treated as ordinary income if forgiven by the lender.
Info compliments of Placer Title Company
As many of you may know, one of the big impediments to short sales was the fact that the taxpayer would be charged with ordinary income for any debt which was forgiven by a lender in the short sale. So the taxpayer might get out from under the property but was left with a big income tax bill. The long awaited tax relief from this provision has now been signed into law. On December 20, 2007, President Bush signed into law the Mortgage Forgiveness Debt Relief Act of 2007 (H.R. 3648) which greatly reduces the negative tax implications of a short sale if the debt being forgiven meets certain criteria. Under this new law, there is a permanent exclusion for discharges of debt of up to $2,000,000 (which was forgiven by the lender after January 1, 2007) if the debt was secured by a principal residence and was incurred in the acquisition, construction or substantial improvement of the principal residence. Instead of including the amount forgiven as income, the basis of the individual's principal residence will be reduced by the amount excluded under the bill. This new law does not change existing law as it relates to forgiveness of a debt which was used for purposes other than acquisition, construction or improvement. So lines of credit and home equity loans which were used for paying off credit cards, buying second homes, boats, etc. will still be treated as ordinary income if forgiven by the lender.
Info compliments of Placer Title Company
Monday, February 25, 2008
Proposition 8: Decline in Market Value
Proposition 8, passed in November 1978, amended Proposition 13 to reflect declines in property value. As a result, Revenue & Taxation Code Section
51 requires the Assessor to annually enroll either a property's Proposition 13 base year value factored for inflation, or its market value as of
January 1st (taking into account any factors causing a decline in value), whichever is less.
Prop 8 reductions in value are temporary reductions which recognize the fact that the current market value of a property has fallen below its current (Prop 13) assessed value. Once a Prop 8 value has been enrolled, a property's value must be reviewed each following January 1st to determine whether its then current market value is less than its Prop 13 factored value. When and if the market value of the Prop 8 property increases above its Prop 13 factored value, the Assessor will once again enroll its Prop 13 factored value. Prop 8 values can change from year to year as the market fluctuates up and down, but in no case may a value higher than a property's Prop 13 factored value be assigned.
The Review process is as follows:
If current market value is below factored Prop 13 value, then:
The assessed value is lowered to market value for the next fiscal year, and the
owner is notified of reduced value by July 1st. A new tax bill is based on the lower
value for the next fiscal year. The following January 1st, the Assessor repeats the
process and enrolls current market value at that time, or Prop 13 factored value,
whichever is lower value.
If market value is higher than factored Prop 13 value, then:
No change in assessed value is made, and the owner is notified that value will not
be reduced (not later than July 1st). If the owner still feels the value should be
reduced, then the owner may file an appeal with the Assessment Appeals Board,
July 2nd-Sept 15th. The Appeals Board then hears evidence from the owner and
Assessor to determine the proper assessed value.
1) Property owner provides Assessor with facts they feel justify a reduction in value and requests a review of the property's value (or the Assessor discovers
the problem independently).
2) Appraisal staff reviews market data as of January 1st, estimates the property's market value as of that date and then compares this market value to the
property's current Prop 13 factored base year value.
This information is compliments of Placer Title Company
For all of Your Real Etate Needs: contact, Jean Powers 800 378-7300
51 requires the Assessor to annually enroll either a property's Proposition 13 base year value factored for inflation, or its market value as of
January 1st (taking into account any factors causing a decline in value), whichever is less.
Prop 8 reductions in value are temporary reductions which recognize the fact that the current market value of a property has fallen below its current (Prop 13) assessed value. Once a Prop 8 value has been enrolled, a property's value must be reviewed each following January 1st to determine whether its then current market value is less than its Prop 13 factored value. When and if the market value of the Prop 8 property increases above its Prop 13 factored value, the Assessor will once again enroll its Prop 13 factored value. Prop 8 values can change from year to year as the market fluctuates up and down, but in no case may a value higher than a property's Prop 13 factored value be assigned.
The Review process is as follows:
If current market value is below factored Prop 13 value, then:
The assessed value is lowered to market value for the next fiscal year, and the
owner is notified of reduced value by July 1st. A new tax bill is based on the lower
value for the next fiscal year. The following January 1st, the Assessor repeats the
process and enrolls current market value at that time, or Prop 13 factored value,
whichever is lower value.
If market value is higher than factored Prop 13 value, then:
No change in assessed value is made, and the owner is notified that value will not
be reduced (not later than July 1st). If the owner still feels the value should be
reduced, then the owner may file an appeal with the Assessment Appeals Board,
July 2nd-Sept 15th. The Appeals Board then hears evidence from the owner and
Assessor to determine the proper assessed value.
1) Property owner provides Assessor with facts they feel justify a reduction in value and requests a review of the property's value (or the Assessor discovers
the problem independently).
2) Appraisal staff reviews market data as of January 1st, estimates the property's market value as of that date and then compares this market value to the
property's current Prop 13 factored base year value.
This information is compliments of Placer Title Company
For all of Your Real Etate Needs: contact, Jean Powers 800 378-7300
Sunday, February 24, 2008
Why Buy a Home in Today’s Market?
www.yourpieceofcalifornia.com
1 Interest rates on long-term, fixed, and adjustable mortgages are at historically low levels. The rate on a 30-year, fixed mortgage is hovering just below 6 percent,while,by comparison, interest rates were hitting 8 percent and higher during the last market down turn in the late 1990s, and were between 10 and 12 percent at the height of the last housing boom in the 1980s. Lower interest rates make it easier to qualify for a loan, and yourmonthly payments are more affordable.
2 No one can put a price on the intrinsic value of homeownership. Home prices also
reflect financial worth and, the good news is, across California the median sales price for a single-family home has been consistently rising for several decades. In short,housing remains a solid, long-term financial investment. While the pace of home appreciation has slowed over the last year, historical data suggest home prices will continue to appreciate overtime. The projected median home price for a single-family home in California in 2008, for example,is $553,000. By comparison, the median price in 2000 was $241,350; $193,770 in 1990,and $99,550 in 1980. (source: C.A.R.)
3 The length of time a home remains on the market before it is sold has increased from roughly two weeks in 2004 to between eight and nine weeks in 2007. According to the unsold inventory index provided by the CALIFORNIA ASSOCIATION OF REALTORS®, it would take 16.3 months to sell all the homes on the market at the current sales pace, compared with 6.4 months in 2006. With more homes on the market for longer periods of time, you have more choices when it comes to selecting a home today.
4 The multiple-offer frenzy that dominated the latest housing boom has subsided, and there is less pressure on today’s home buyers to outbid one another. REALTORS® in California reported that in 2007 only 28 percent of homes sold had multiple offers,compared with 57 percentin 2004. (source: C.A.R.)
5 The credit industry crisis that has made securing a home loan difficult for many has led to heightened scrutiny of mortgage lenders. As a result, state and federal agencies have created protections for home buyers that were not in place a year ago. The U.S. Federal Reserve, for example,has proposed a plan to require lenders to confirm a borrower’s ability to afford a mortgage before making a loan and establishing guidelines for explaining subprime loan terms in order to better educate buyers. Many new public education and awareness campaigns, such as Freddie Mac’s “Don’t Borrow Trouble®” campaign, have been developed to help you achieve the dream of homeownership without the financial risks that led so many borrowers into trouble in recent years.
Buying a home in today’s market may be challenging, particularly for those with credit problems or little saved to put toward a down payment. But there are many factors impacting the current housing market that make buying a home today a viable option.
Information compliments of California Association of Realtors
Ready to Buy or Sell?
Contact Jean: homes@jeanpowers.com 800-378-7300
www.yourpieceofcalifornia.com
1 Interest rates on long-term, fixed, and adjustable mortgages are at historically low levels. The rate on a 30-year, fixed mortgage is hovering just below 6 percent,while,by comparison, interest rates were hitting 8 percent and higher during the last market down turn in the late 1990s, and were between 10 and 12 percent at the height of the last housing boom in the 1980s. Lower interest rates make it easier to qualify for a loan, and yourmonthly payments are more affordable.
2 No one can put a price on the intrinsic value of homeownership. Home prices also
reflect financial worth and, the good news is, across California the median sales price for a single-family home has been consistently rising for several decades. In short,housing remains a solid, long-term financial investment. While the pace of home appreciation has slowed over the last year, historical data suggest home prices will continue to appreciate overtime. The projected median home price for a single-family home in California in 2008, for example,is $553,000. By comparison, the median price in 2000 was $241,350; $193,770 in 1990,and $99,550 in 1980. (source: C.A.R.)
3 The length of time a home remains on the market before it is sold has increased from roughly two weeks in 2004 to between eight and nine weeks in 2007. According to the unsold inventory index provided by the CALIFORNIA ASSOCIATION OF REALTORS®, it would take 16.3 months to sell all the homes on the market at the current sales pace, compared with 6.4 months in 2006. With more homes on the market for longer periods of time, you have more choices when it comes to selecting a home today.
4 The multiple-offer frenzy that dominated the latest housing boom has subsided, and there is less pressure on today’s home buyers to outbid one another. REALTORS® in California reported that in 2007 only 28 percent of homes sold had multiple offers,compared with 57 percentin 2004. (source: C.A.R.)
5 The credit industry crisis that has made securing a home loan difficult for many has led to heightened scrutiny of mortgage lenders. As a result, state and federal agencies have created protections for home buyers that were not in place a year ago. The U.S. Federal Reserve, for example,has proposed a plan to require lenders to confirm a borrower’s ability to afford a mortgage before making a loan and establishing guidelines for explaining subprime loan terms in order to better educate buyers. Many new public education and awareness campaigns, such as Freddie Mac’s “Don’t Borrow Trouble®” campaign, have been developed to help you achieve the dream of homeownership without the financial risks that led so many borrowers into trouble in recent years.
Buying a home in today’s market may be challenging, particularly for those with credit problems or little saved to put toward a down payment. But there are many factors impacting the current housing market that make buying a home today a viable option.
Information compliments of California Association of Realtors
Ready to Buy or Sell?
Contact Jean: homes@jeanpowers.com 800-378-7300
Saturday, February 23, 2008
A Seller's Plan! Where do I Start?
1. Find the Right Representative
The experience and knowledge of a dedicated real estate professional can be priceless. A good Realtor® forms a powerful team with his or her clients that makes it possible for them to have a smooth, successful, stress-free sale.
2. Determine your Needs/Wants for the Sale and for Your New Home
Selling your primary residence can be tricky because you have to simultaneously be thinking about where you would like to buy. First weigh your priorities – selling price is certainly important, but having a quick and efficient sale can often be worth accepting a slightly lower offer. Talk to your agent and make sure you’re comfortable with where your priorities are.
At the same time, you should be compiling a needs/wants list for the home you will buy. You will probably have to act fairly quickly when your house sells, so any amount of preparation you can do will serve you well.
3. Prepare Your House for Showing
Underprepared homes can be sales disasters. Your home will never get as much attention from potential buyers as when it is first listed, so clearing clutter, cleaning, making repairs, and putting your home’s best foot forward is essential. Don’t “open for business” until your home is ready to be seen as favorably as possible.
4. Find out How Your Local Market Looks
Being realistic about your market is the key to a smooth sale. There is no substitute for a professional real estate representative when it comes to local market knowledge.
5. List aAway!
Lots of photos and online exposure are the key to getting a good response for your listing. Working with an agent who uses Point2 Agent software is a great step in the right direction. Now just “open” the house and sit back and wait for the flood of eager buyers!
--------------------------------------------------------------------------------
What is a CMA and Why Do You Need One?
CMA is real estate shorthand for "Comparative Market Analysis." A CMA is a report prepared by a real estate agent providing data comparing your property to similar properties in the marketplace.
The first thing an agent will need to do to provide you with a CMA is to inspect your property. Generally, this inspection won't be overly detailed (she or he is not going to crawl under the house to examine the foundation), nor does the house need to be totally cleaned up and ready for an open house. It should be in such a condition that the agent will be able to make an accurate assessment of its condition and worth. If you plan to make changes before selling, inform the agent at this time.
The next step is for the agent to obtain data on comparable properties. This data is usually available through MLS (Multiple Listing Service), but a qualified agent will also know of properties that are on the market or have sold without being part of the MLS. This will give the agent an idea how much your property is worth in the current market. Please note that the CMA is not an appraisal. An appraisal must be performed by a licensed appraiser.
The CMA process takes place before your home is listed for sale. This is a good assessment of what your house could potentially sell for.
CMAs are not only for prospective sellers. Buyers should consider requesting a CMA for properties they are seriously looking at to determine whether the asking price is a true reflection of the current market. Owners who are upgrading or remodeling can benefit from a CMA when it's used to see if the intended changes will "over-improve" their property compared to others in the neighborhood.
Jean Powers CRS, ASP®, e-PRO, PMN
Real Estate Broker
(510) 908.9002
(800) 378.7300
Homes@JeanPowers.com
www.JeanPowers.com
www.JeanSellsDreams.com
The experience and knowledge of a dedicated real estate professional can be priceless. A good Realtor® forms a powerful team with his or her clients that makes it possible for them to have a smooth, successful, stress-free sale.
2. Determine your Needs/Wants for the Sale and for Your New Home
Selling your primary residence can be tricky because you have to simultaneously be thinking about where you would like to buy. First weigh your priorities – selling price is certainly important, but having a quick and efficient sale can often be worth accepting a slightly lower offer. Talk to your agent and make sure you’re comfortable with where your priorities are.
At the same time, you should be compiling a needs/wants list for the home you will buy. You will probably have to act fairly quickly when your house sells, so any amount of preparation you can do will serve you well.
3. Prepare Your House for Showing
Underprepared homes can be sales disasters. Your home will never get as much attention from potential buyers as when it is first listed, so clearing clutter, cleaning, making repairs, and putting your home’s best foot forward is essential. Don’t “open for business” until your home is ready to be seen as favorably as possible.
4. Find out How Your Local Market Looks
Being realistic about your market is the key to a smooth sale. There is no substitute for a professional real estate representative when it comes to local market knowledge.
5. List aAway!
Lots of photos and online exposure are the key to getting a good response for your listing. Working with an agent who uses Point2 Agent software is a great step in the right direction. Now just “open” the house and sit back and wait for the flood of eager buyers!
--------------------------------------------------------------------------------
What is a CMA and Why Do You Need One?
CMA is real estate shorthand for "Comparative Market Analysis." A CMA is a report prepared by a real estate agent providing data comparing your property to similar properties in the marketplace.
The first thing an agent will need to do to provide you with a CMA is to inspect your property. Generally, this inspection won't be overly detailed (she or he is not going to crawl under the house to examine the foundation), nor does the house need to be totally cleaned up and ready for an open house. It should be in such a condition that the agent will be able to make an accurate assessment of its condition and worth. If you plan to make changes before selling, inform the agent at this time.
The next step is for the agent to obtain data on comparable properties. This data is usually available through MLS (Multiple Listing Service), but a qualified agent will also know of properties that are on the market or have sold without being part of the MLS. This will give the agent an idea how much your property is worth in the current market. Please note that the CMA is not an appraisal. An appraisal must be performed by a licensed appraiser.
The CMA process takes place before your home is listed for sale. This is a good assessment of what your house could potentially sell for.
CMAs are not only for prospective sellers. Buyers should consider requesting a CMA for properties they are seriously looking at to determine whether the asking price is a true reflection of the current market. Owners who are upgrading or remodeling can benefit from a CMA when it's used to see if the intended changes will "over-improve" their property compared to others in the neighborhood.
Jean Powers CRS, ASP®, e-PRO, PMN
Real Estate Broker
(510) 908.9002
(800) 378.7300
Homes@JeanPowers.com
www.JeanPowers.com
www.JeanSellsDreams.com
Friday, February 22, 2008
A Buyers's Transaction!
Where do I Start?
For many, beginning the homebuying process can be overwhelming. You may be uncertain about taking the initial steps. I hope this guide will help clear up some of those uncertainties by providing you with some useful information about the homebuying process.
When is the right time to start talking to a professional, and who do I choose?
Anytime you have questions you want answered is the right time to start. You can begin with either a Realtor or a lender. A Realtor can help you assess your financial picture, counsel you through the entire homebuying process, find a home that suits you and introduce you to a lender who can work with you on a financing package that meets your needs. A Realtor will work through all the intricacies of the transaction until close of escrow. A lender will work with you on the loan process and can preapprove you for a loan before you even begin house-hunting.
If it happens that you are not ready for any of this, both professionals will be happy simply to provide you with information.
How do I choose a Realtor?
In today's market, finding and purchasing a home can be a very involved and a complicated process. It is essential to find a Realtor who is qualified and dedicated to providing you with the best representation. It is best that you hire a Realtor who is a Broker. A Broker has more education, knowledge and skills than a Realtor who only has a Sales license. Always check the Department of Real Estate to see how long the Realtor has had a license and if they are in good standing. You can go to: www.dre.org . Once you have found that the Realtor is experienced and a full-time professional who knows the market in the area in which you are interested, determine if they know the available inventory in your location and price range. Ask for and check for references.
Your Realtor should have the time and energy to devote to you and your search for a home. Perhaps most importantly, choose an agent with whom you have a personal rapport.
Buying a home is an intimate type of business transaction. Trying to go through the process with someone you can't relate to will not work. Find a qualified Broker who you like, one who matches your personality and meets your individual needs. This will make the home purchase experience much more enjoyable.
What happens after I have chosen a Broker Realtor and spoken with a lender?
Given your price range, decide what kind of home you want and need. Think about size, location, special features such as fireplace and garage.
Begin looking at properties with your Realtor Broker so you have a good basis for making a final decision. Assess whether the home you can afford to purchase is the right home for you. If this is not the case, you may be unrealistic in your expectations and may need to adjust them to suit your budget.
When you find the home you like, make an offer to purchase. Your Realtor Broker's knowledge of the market and market values will assist you in making sure the price you offer represents good value for the property.
I've found the home I want. I've made the offer. What happens next?
The seller may accept your offer, reject your offer, or make a counter offer. If your offer is rejected, you can make another offer or look for a different house. If the seller makes a counter offer, you can either accept that offer or counter with yet another offer. Negotiations may continue back and forth until you and the seller agree to a final purchase price and terms of the contract. When this agreement is reached, the offer is "ratified". Your Realtor will now be required to deposit the specifed amount as per your contract, into an escrow account with a Title Company. During the escrow period, which is usually 30 to 40 days, certain conditions ("contingencies") specified in the contract must be met or waived within agreed-upon time periods.
These conditions typically include: having a professional inspection of the property, obtaining formal loan approval from the lender, and reviewing the seller's disclosures.
When Will I Actually Own The Home?
You will own the home when all conditions of the contract are met and escrow closes. The following are some of the conditions commonly found in home purchase contracts:
Finding a loan for the amount and at the terms stated in the contract. You should have a pre approved loan with a lender prior to submitting an offer to purchase the property.
Receiving a satisfactory report on the condition of the home by a professional home inspector, and a termite inspector. Obtaining any other inspections you deem necessary. If major problems are discovered, you do not have to buy the home or you can renegotiate the contract.
Conducting a title search and ensuring the property is free of any legal claims against it. You will also have to buy title insurance for yourself and the lender, in case a problem with the title arises after you purchase the house.
Purchasing homeowner's or hazard insurance is required by the lender.
Asking and receiving satisfactory answers to any and all questions you have about the property.
Obtaining disclosures from the seller informing the buyer of any fact which the seller is aware of that would materially affect the value of the property.
The seller must make any repairs to the home which are agreed upon in the contract, you may purchase property in its present condition or ask the seller to credit money in escrow for repairs.
Just prior to close of escrow, your loan becomes effective (it "funds"). The escrow officer will explain the closing documents which you must sign. One of these is a HUD-1 settlement form from the lender. This form, required by federal law, itemizes the services and costs to the buyer and seller. You will also be required to pay the closing costs and the rest of the downpayment, either wired or by a cashier's check, to the title company at least 2 days prior to closing escrow.
The title company formally records the new deed of trust, and you go "on record" as the new owner. You get the keys to your new home and, it's yours!
How important is my credit?
In addition to verifying income, a lender will want a credit report showing that a borrower has repaid monthly debts on a timely and regular basis. It would be a good idea to examine your credit history prior to submitting a mortgage application. If you discover any discrepancies, be sure to notify the credit bureau to correct them, because any unexplained credit delinquencies can be a basis for a disapproval by a lender.
Many delinquent or late payment accounts can be resolved by writing a detailed explanatory letter to the credit bureau. There are several national credit bureaus that provide credit reports for a nominal fee. Listed below are the credit bureaus commonly used by the lending industry.
Equifax Information Service
P.O. Box 740241 Atlanta, GA 30374-0241
(800) 685-1111 ($8.00 service charge)
TRW Credit Data
P.O. Box 749029Dallas,TX 75374-9029
(800) 392-1122
(1 free yearly)
When writing to the above agencies, provide your full name, present address, previous 5 year addresses, social security number, date of birth, and a verification of your name and present address (e.g. a copy of a billing statement).
How do I find the best loan?
Loans are available from a number of sources, including banks, mortgage companies, federal credit unions and financial companies. Your Realtor can be a good source of information about various lenders.
Assessing current needs and future objectives
You can simplify your search for the right loan if you start with a clear understanding of your plans for the property. Such an understanding requires some soul-searching on you part as to your personal and financial goals.
Ask yourself:
Are you looking to build equity quickly? Are you expecting increases in your income?
Is there a strong possibility of a career change or other situation which might cause you to have to move in the near future?
To what extent will the tax deductions from your home's interest payments affect your present and future tax situation?
Are you planning any major improvements? If so, how will they be financed?Before you start looking for homes, it is important to have a good idea of how much you can put down and how much you can afford in monthly payments.
Downpayment
You may intend to put 20% of the purchase price as a downpayment. There are loans available with as little as 5% down, although lenders may charge somewhat higher fees or interest on these. Also, a downpayment less than 20% often includes a requirement from the lender that you purchase private mortgage insurance (PMI) as a protection against possible default.
Monthly Payments
In addition to the downpayment, lenders want to determine if a borrower has enough stable income to make payments on a mortgage. Typically, they do not want a borrower's total housing costs, principal, interest, taxes, and insurance (PITI), to exceed 33 percent of his/her monthly income. The "33" is sometimes called a "top" ratio. Also, total housing costs plus other monthly expenses (car payments, student loans, credit cards, etc.) should not exceed 38 percent of the borrower's total gross income. These parameters are not absolute. Some buyers may qualify at a higher debt-to-income ratio
Types of loans
Today's borrower can choose from several types of loans. Some loans feature the same rate and payment amount for the duration of the loan (Fixed). Others are more flexible. Their rates and payment schedules can adjust to reflect changing economic factors (Adjustable). Still others offer a convertible feature, enabling you to convert from one type of loan to another after a period of time.
Fixed rate loans
Predictability is the key feature of a fixed rate loan. You can be certain that your rate and payment will never change as long as you have the loan. This makes it easier to plan and budget your finances.
Adjustable rate loans (ARMs)
ARM interest rates are tied to-and fluctuate to reflect changes in-a published financial index. When those index rates go up or down, ARM rates do too. By law, the index a lender uses cannot be controlled by that lender (e.g. a bank cannot use its prime rate as an index). Common indices include 11th District Cost of Funds, one-year T-note, and six-month T-bill. ARMs are easier to qualify for than fixed rate loans because the interest start rate is lower.
Glossary of lending terms
Annual payment capsAn annual cap limits the amount of change in payment that can occur. The maximum amount of change is usually 7.5% of the previous year's monthly payment. Payments cannot exceed that cap, no matter what the index rate does during the year. If, for example, your monthly payment is $1,000, it cannot go up by more than $75 per month the following year.
Annual percentage rate (APR)
APR is the effective interest rate over its projected life. It includes interest plus all other costs such as lender fees and closing costs (escrow, title insurance, appraisal fee, processing, etc.) Your loan's APR is a reflection of what you'll be paying annually for the loan and a good way to compare with other loans. Your lender is required by law to quote the APR when quoting an interest rate.
Closing costs
Expenses in addition to the price of the home incurred by buyers and sellers when a home is sold. Common closing costs include escrow fees, title insurance fees, document recording fees and real estate commissions.
Index
There are a number of them. Some move sharply over relatively short time spans. Others change more slowly over longer period of time.
Interest rate adjustment caps
ARMs that don't have an annual payment cap will usually offer an annual cap of up to 2% of interest rates adjustments.
Lifetime interest rate caps
This feature puts a ceiling on the rate to which an ARM loan can be adjusted over the life of the loan. If the rate ever reaches the lifetime cap, the borrower has a fixed rate loan at that rate until the index falls again, and the rate can be adjusted downward.
Loan assumability
Unlike fixed rate mortgages, many ARM loans can be assumed by a qualified borrower. This can be a valuable benefit when the time comes to sell the home.
Margin
The interest rate for an ARM loan reflects the index plus a fixed margin. The margin covers the lender's operating expenses and profit. The margin amount must be included in the loan document, and can not change once the loan is funded.
Negative amortization
Negative amortization can occur when the payment is not large enough to cover the full amount of interest due. The borrower can choose whether he wants to pay the additional amount or have it added to the loan balance.
No prepayment penalty
Most ARMs can be paid off either fully or partially with no penalty.
Points
One point equals 1 percent of the mortgage amount. Typically lenders charge from zero to two points. Loan points are tax deductible.
Locking in
Also called a rate-lock, this is a lender's promise to commit to a certain interest rate on a loan, usually for 30 to 60 days.
Deciding on a Lender
It is important to find a lender you can depend on to provide you a loan at a competitive rate. In addition, you want your application processed swiftly and accurately at reasonable cost. The lending institution's stability, experience and commitment should also be examined.
Your Realtor can help you find a lender with a financing package that meets your needs.
What is an escrow and why is it needed?
An escrow is an arrangement in which a disinterested third party, called an escrow holder, holds legal documents and funds on behalf of a buyer and seller, and distributes them according to the buyer's and seller's instructions.
People buying and selling real estate often open an escrow for their protection and convenience. The buyer can instruct the escrow holder to disburse the purchase price only upon the satisfaction of certain prerequisites and conditions. The seller can instruct the escrow holder to retain possession of the deed until the seller's requirements, including receipt of the purchase price, are met. Both rely on the escrow holder to carry out faithfully their mutually consistent instructions relating to the transaction and to advise them if any of their instructions are not mutually consistent or cannot be carried out.
An escrow is convenient for the buyer and seller because both can move forward separately but simultaneously in providing inspections, reports, loan commitments and funds, deeds, and many other items using the escrow holder as the central depositing point. If the instructions from all parties to an escrow are clearly drafted, fully detailed and mutually consistent, the escrow holder can take many actions on their behalf without further consultation. This saves much time and facilitates the closing of the transaction.
Who may hold escrows
The escrow holder may be any disinterested third party (some states require escrow holders to be licensed). Escrow officers with established firms generally are experienced and trained in real estate procedures, title insurance, taxes, deeds and insurance.
Impartiality
An escrow officer must remain completely impartial throughout the entire escrow process.He or she must follow instructions of both parties without bias.
Escrow instructions
Escrow instructions are written documents, signed by the parties giving them, which direct the escrow officer in the specific steps to be completed so the escrow can be closed. Typical instructions might include: the method by which the escrow holder is to receive and hold the purchase price to be paid by the buyer; the conditions under which a lapse of time or breach of purchase contract provision will terminate the escrow without a closing; instructions on the payment of prior liens.
Closing the escrow
Once the terms and conditions of the instructions of both parties have been fulfilled, the escrow is closed and the safe and accurate transfer of property and money has been accomplished.
In summary
The escrow holder facilitates real estate sales or purchases by:
Acting as the impartial depository of documents and funds.- Keeping all parties informed of progress on escrow.
Responding to lender's requirements
Securing a title insurance policy
Prorating and adjusting insurance, taxes, etc
Recording the deed and loan documents
It's not always that simple
Every escrow is unique and most are more complex than explained here. If you have further questions, contact an escrow officer or attorney to provide more detailed information.
What protection does title insurance provide?
Title insurance protects against any matter affecting the past ownership of the property. Title insurance is issued after the title company carefully examines copies of the public record. However, even the most thorough search cannot absolutely assure that no title hazards are present, despite the knowledge ad experience of professional title examiners. In addition to matters shown by public records, other title problems may exist that cannot be disclosed in a search.
Some common hidden risks that can cause a loss of title or create an encumbrance on title:
False impersonation of the true owner of the property
Forged deeds, releases, or wills
Undisclosed or missing heirs
Instruments executed under invalid or expired power of attorney
Mistakes in recording legal documents
Misinterpretations of wills
Fraud
Deeds by persons of unsound mind
Deeds by minors
Deeds by persons supposedly single, but in fact married
Liens for unpaid estate, inheritance, income or gift taxes
Title insurance will pay for defending against any lawsuit attacking your title problems or pay the insured's losses. For a one time premium, and owner's title insurance policy remains in effect as long as you or your heirs retain an interest in the property, or have any obligation under a warranty in any conveyance of it.
By combining expertise in risk elimination at the time of issuing a policy, and protection against hidden risks as long as the policy remains in effect, your title insurer protects against title loss.For more detailed information on title insurance, contact a title officer at your title company.
I hope you have found this information helpful. It is designed to be of general interest, and while the content is reliable, it is not intended as a substitute for the advice of professional lenders, accountants, escrow officers, attorneys, etc. Before acting on any matter contained herein, you should consult with your professional adviser.
Do not hesitate to call or email me if you have any questions .
Homes@JeanPowers.com
510.908.9002 Cell
800.378.7800 Bus.
For many, beginning the homebuying process can be overwhelming. You may be uncertain about taking the initial steps. I hope this guide will help clear up some of those uncertainties by providing you with some useful information about the homebuying process.
When is the right time to start talking to a professional, and who do I choose?
Anytime you have questions you want answered is the right time to start. You can begin with either a Realtor or a lender. A Realtor can help you assess your financial picture, counsel you through the entire homebuying process, find a home that suits you and introduce you to a lender who can work with you on a financing package that meets your needs. A Realtor will work through all the intricacies of the transaction until close of escrow. A lender will work with you on the loan process and can preapprove you for a loan before you even begin house-hunting.
If it happens that you are not ready for any of this, both professionals will be happy simply to provide you with information.
How do I choose a Realtor?
In today's market, finding and purchasing a home can be a very involved and a complicated process. It is essential to find a Realtor who is qualified and dedicated to providing you with the best representation. It is best that you hire a Realtor who is a Broker. A Broker has more education, knowledge and skills than a Realtor who only has a Sales license. Always check the Department of Real Estate to see how long the Realtor has had a license and if they are in good standing. You can go to: www.dre.org . Once you have found that the Realtor is experienced and a full-time professional who knows the market in the area in which you are interested, determine if they know the available inventory in your location and price range. Ask for and check for references.
Your Realtor should have the time and energy to devote to you and your search for a home. Perhaps most importantly, choose an agent with whom you have a personal rapport.
Buying a home is an intimate type of business transaction. Trying to go through the process with someone you can't relate to will not work. Find a qualified Broker who you like, one who matches your personality and meets your individual needs. This will make the home purchase experience much more enjoyable.
What happens after I have chosen a Broker Realtor and spoken with a lender?
Given your price range, decide what kind of home you want and need. Think about size, location, special features such as fireplace and garage.
Begin looking at properties with your Realtor Broker so you have a good basis for making a final decision. Assess whether the home you can afford to purchase is the right home for you. If this is not the case, you may be unrealistic in your expectations and may need to adjust them to suit your budget.
When you find the home you like, make an offer to purchase. Your Realtor Broker's knowledge of the market and market values will assist you in making sure the price you offer represents good value for the property.
I've found the home I want. I've made the offer. What happens next?
The seller may accept your offer, reject your offer, or make a counter offer. If your offer is rejected, you can make another offer or look for a different house. If the seller makes a counter offer, you can either accept that offer or counter with yet another offer. Negotiations may continue back and forth until you and the seller agree to a final purchase price and terms of the contract. When this agreement is reached, the offer is "ratified". Your Realtor will now be required to deposit the specifed amount as per your contract, into an escrow account with a Title Company. During the escrow period, which is usually 30 to 40 days, certain conditions ("contingencies") specified in the contract must be met or waived within agreed-upon time periods.
These conditions typically include: having a professional inspection of the property, obtaining formal loan approval from the lender, and reviewing the seller's disclosures.
When Will I Actually Own The Home?
You will own the home when all conditions of the contract are met and escrow closes. The following are some of the conditions commonly found in home purchase contracts:
Finding a loan for the amount and at the terms stated in the contract. You should have a pre approved loan with a lender prior to submitting an offer to purchase the property.
Receiving a satisfactory report on the condition of the home by a professional home inspector, and a termite inspector. Obtaining any other inspections you deem necessary. If major problems are discovered, you do not have to buy the home or you can renegotiate the contract.
Conducting a title search and ensuring the property is free of any legal claims against it. You will also have to buy title insurance for yourself and the lender, in case a problem with the title arises after you purchase the house.
Purchasing homeowner's or hazard insurance is required by the lender.
Asking and receiving satisfactory answers to any and all questions you have about the property.
Obtaining disclosures from the seller informing the buyer of any fact which the seller is aware of that would materially affect the value of the property.
The seller must make any repairs to the home which are agreed upon in the contract, you may purchase property in its present condition or ask the seller to credit money in escrow for repairs.
Just prior to close of escrow, your loan becomes effective (it "funds"). The escrow officer will explain the closing documents which you must sign. One of these is a HUD-1 settlement form from the lender. This form, required by federal law, itemizes the services and costs to the buyer and seller. You will also be required to pay the closing costs and the rest of the downpayment, either wired or by a cashier's check, to the title company at least 2 days prior to closing escrow.
The title company formally records the new deed of trust, and you go "on record" as the new owner. You get the keys to your new home and, it's yours!
How important is my credit?
In addition to verifying income, a lender will want a credit report showing that a borrower has repaid monthly debts on a timely and regular basis. It would be a good idea to examine your credit history prior to submitting a mortgage application. If you discover any discrepancies, be sure to notify the credit bureau to correct them, because any unexplained credit delinquencies can be a basis for a disapproval by a lender.
Many delinquent or late payment accounts can be resolved by writing a detailed explanatory letter to the credit bureau. There are several national credit bureaus that provide credit reports for a nominal fee. Listed below are the credit bureaus commonly used by the lending industry.
Equifax Information Service
P.O. Box 740241 Atlanta, GA 30374-0241
(800) 685-1111 ($8.00 service charge)
TRW Credit Data
P.O. Box 749029Dallas,TX 75374-9029
(800) 392-1122
(1 free yearly)
When writing to the above agencies, provide your full name, present address, previous 5 year addresses, social security number, date of birth, and a verification of your name and present address (e.g. a copy of a billing statement).
How do I find the best loan?
Loans are available from a number of sources, including banks, mortgage companies, federal credit unions and financial companies. Your Realtor can be a good source of information about various lenders.
Assessing current needs and future objectives
You can simplify your search for the right loan if you start with a clear understanding of your plans for the property. Such an understanding requires some soul-searching on you part as to your personal and financial goals.
Ask yourself:
Are you looking to build equity quickly? Are you expecting increases in your income?
Is there a strong possibility of a career change or other situation which might cause you to have to move in the near future?
To what extent will the tax deductions from your home's interest payments affect your present and future tax situation?
Are you planning any major improvements? If so, how will they be financed?Before you start looking for homes, it is important to have a good idea of how much you can put down and how much you can afford in monthly payments.
Downpayment
You may intend to put 20% of the purchase price as a downpayment. There are loans available with as little as 5% down, although lenders may charge somewhat higher fees or interest on these. Also, a downpayment less than 20% often includes a requirement from the lender that you purchase private mortgage insurance (PMI) as a protection against possible default.
Monthly Payments
In addition to the downpayment, lenders want to determine if a borrower has enough stable income to make payments on a mortgage. Typically, they do not want a borrower's total housing costs, principal, interest, taxes, and insurance (PITI), to exceed 33 percent of his/her monthly income. The "33" is sometimes called a "top" ratio. Also, total housing costs plus other monthly expenses (car payments, student loans, credit cards, etc.) should not exceed 38 percent of the borrower's total gross income. These parameters are not absolute. Some buyers may qualify at a higher debt-to-income ratio
Types of loans
Today's borrower can choose from several types of loans. Some loans feature the same rate and payment amount for the duration of the loan (Fixed). Others are more flexible. Their rates and payment schedules can adjust to reflect changing economic factors (Adjustable). Still others offer a convertible feature, enabling you to convert from one type of loan to another after a period of time.
Fixed rate loans
Predictability is the key feature of a fixed rate loan. You can be certain that your rate and payment will never change as long as you have the loan. This makes it easier to plan and budget your finances.
Adjustable rate loans (ARMs)
ARM interest rates are tied to-and fluctuate to reflect changes in-a published financial index. When those index rates go up or down, ARM rates do too. By law, the index a lender uses cannot be controlled by that lender (e.g. a bank cannot use its prime rate as an index). Common indices include 11th District Cost of Funds, one-year T-note, and six-month T-bill. ARMs are easier to qualify for than fixed rate loans because the interest start rate is lower.
Glossary of lending terms
Annual payment capsAn annual cap limits the amount of change in payment that can occur. The maximum amount of change is usually 7.5% of the previous year's monthly payment. Payments cannot exceed that cap, no matter what the index rate does during the year. If, for example, your monthly payment is $1,000, it cannot go up by more than $75 per month the following year.
Annual percentage rate (APR)
APR is the effective interest rate over its projected life. It includes interest plus all other costs such as lender fees and closing costs (escrow, title insurance, appraisal fee, processing, etc.) Your loan's APR is a reflection of what you'll be paying annually for the loan and a good way to compare with other loans. Your lender is required by law to quote the APR when quoting an interest rate.
Closing costs
Expenses in addition to the price of the home incurred by buyers and sellers when a home is sold. Common closing costs include escrow fees, title insurance fees, document recording fees and real estate commissions.
Index
There are a number of them. Some move sharply over relatively short time spans. Others change more slowly over longer period of time.
Interest rate adjustment caps
ARMs that don't have an annual payment cap will usually offer an annual cap of up to 2% of interest rates adjustments.
Lifetime interest rate caps
This feature puts a ceiling on the rate to which an ARM loan can be adjusted over the life of the loan. If the rate ever reaches the lifetime cap, the borrower has a fixed rate loan at that rate until the index falls again, and the rate can be adjusted downward.
Loan assumability
Unlike fixed rate mortgages, many ARM loans can be assumed by a qualified borrower. This can be a valuable benefit when the time comes to sell the home.
Margin
The interest rate for an ARM loan reflects the index plus a fixed margin. The margin covers the lender's operating expenses and profit. The margin amount must be included in the loan document, and can not change once the loan is funded.
Negative amortization
Negative amortization can occur when the payment is not large enough to cover the full amount of interest due. The borrower can choose whether he wants to pay the additional amount or have it added to the loan balance.
No prepayment penalty
Most ARMs can be paid off either fully or partially with no penalty.
Points
One point equals 1 percent of the mortgage amount. Typically lenders charge from zero to two points. Loan points are tax deductible.
Locking in
Also called a rate-lock, this is a lender's promise to commit to a certain interest rate on a loan, usually for 30 to 60 days.
Deciding on a Lender
It is important to find a lender you can depend on to provide you a loan at a competitive rate. In addition, you want your application processed swiftly and accurately at reasonable cost. The lending institution's stability, experience and commitment should also be examined.
Your Realtor can help you find a lender with a financing package that meets your needs.
What is an escrow and why is it needed?
An escrow is an arrangement in which a disinterested third party, called an escrow holder, holds legal documents and funds on behalf of a buyer and seller, and distributes them according to the buyer's and seller's instructions.
People buying and selling real estate often open an escrow for their protection and convenience. The buyer can instruct the escrow holder to disburse the purchase price only upon the satisfaction of certain prerequisites and conditions. The seller can instruct the escrow holder to retain possession of the deed until the seller's requirements, including receipt of the purchase price, are met. Both rely on the escrow holder to carry out faithfully their mutually consistent instructions relating to the transaction and to advise them if any of their instructions are not mutually consistent or cannot be carried out.
An escrow is convenient for the buyer and seller because both can move forward separately but simultaneously in providing inspections, reports, loan commitments and funds, deeds, and many other items using the escrow holder as the central depositing point. If the instructions from all parties to an escrow are clearly drafted, fully detailed and mutually consistent, the escrow holder can take many actions on their behalf without further consultation. This saves much time and facilitates the closing of the transaction.
Who may hold escrows
The escrow holder may be any disinterested third party (some states require escrow holders to be licensed). Escrow officers with established firms generally are experienced and trained in real estate procedures, title insurance, taxes, deeds and insurance.
Impartiality
An escrow officer must remain completely impartial throughout the entire escrow process.He or she must follow instructions of both parties without bias.
Escrow instructions
Escrow instructions are written documents, signed by the parties giving them, which direct the escrow officer in the specific steps to be completed so the escrow can be closed. Typical instructions might include: the method by which the escrow holder is to receive and hold the purchase price to be paid by the buyer; the conditions under which a lapse of time or breach of purchase contract provision will terminate the escrow without a closing; instructions on the payment of prior liens.
Closing the escrow
Once the terms and conditions of the instructions of both parties have been fulfilled, the escrow is closed and the safe and accurate transfer of property and money has been accomplished.
In summary
The escrow holder facilitates real estate sales or purchases by:
Acting as the impartial depository of documents and funds.- Keeping all parties informed of progress on escrow.
Responding to lender's requirements
Securing a title insurance policy
Prorating and adjusting insurance, taxes, etc
Recording the deed and loan documents
It's not always that simple
Every escrow is unique and most are more complex than explained here. If you have further questions, contact an escrow officer or attorney to provide more detailed information.
What protection does title insurance provide?
Title insurance protects against any matter affecting the past ownership of the property. Title insurance is issued after the title company carefully examines copies of the public record. However, even the most thorough search cannot absolutely assure that no title hazards are present, despite the knowledge ad experience of professional title examiners. In addition to matters shown by public records, other title problems may exist that cannot be disclosed in a search.
Some common hidden risks that can cause a loss of title or create an encumbrance on title:
False impersonation of the true owner of the property
Forged deeds, releases, or wills
Undisclosed or missing heirs
Instruments executed under invalid or expired power of attorney
Mistakes in recording legal documents
Misinterpretations of wills
Fraud
Deeds by persons of unsound mind
Deeds by minors
Deeds by persons supposedly single, but in fact married
Liens for unpaid estate, inheritance, income or gift taxes
Title insurance will pay for defending against any lawsuit attacking your title problems or pay the insured's losses. For a one time premium, and owner's title insurance policy remains in effect as long as you or your heirs retain an interest in the property, or have any obligation under a warranty in any conveyance of it.
By combining expertise in risk elimination at the time of issuing a policy, and protection against hidden risks as long as the policy remains in effect, your title insurer protects against title loss.For more detailed information on title insurance, contact a title officer at your title company.
I hope you have found this information helpful. It is designed to be of general interest, and while the content is reliable, it is not intended as a substitute for the advice of professional lenders, accountants, escrow officers, attorneys, etc. Before acting on any matter contained herein, you should consult with your professional adviser.
Do not hesitate to call or email me if you have any questions .
Homes@JeanPowers.com
510.908.9002 Cell
800.378.7800 Bus.
Thursday, February 21, 2008
Californians Can Afford to Purchase a New Home!
Group says more Californians can afford to buy their first home
By ALEX VEIGA, AP Business Writer
(02-19) 12:13 PST Los Angeles (AP) --
Frustrated California renters take heed: A trade group says it's getting easier for people to afford their first home.
With home prices in a downward spiral in many once-booming areas, the percentage of California households that can afford to finance an entry-level home increased in the last three months of 2007 compared to the same period a year earlier, the California Association of Realtors said Tuesday.
The trade group for real estate agents calculates affordability based on the minimum household income required to make a 10 percent downpayment and secure an adjustable interest rate loan at 6.21 percent.
Some 33 percent of the households in the state met those guidelines in the fourth quarter — up from 25 percent in the same three months of 2006, the association said.
Buyers needed to earn $82,200 to afford financing of $411,170, the typical statewide price for an entry-level home during the quarter, the trade association estimated.
The monthly payment for such a purchase, including taxes and insurance, was $2,740, the association said.
An entry-level home was defined as one priced at about 85 percent of the median home price in an area.
The most affordable area of the state during the quarter was the desert north of Los Angeles, where some 54 percent of households met the association's $43,800 annual income threshold to finance an entry-level home priced at $218,880.
Sacramento County was next, with 53 percent of households within the income range needed to afford a home priced at $252,920.
The least affordable area was the Central Coast region of Monterey, where only 20 percent of households earned the $118,200 needed to finance an entry-level home at $591,200.
In Los Angeles County, 27 percent of households earned the $86,700 a year needed to buy a home priced at $433,200.
Some 46 percent of households in Riverside and San Bernardino counties, which have been hit particularly hard by rising foreclosures and falling home values, earned $57,600 a year, enough to finance a $287,330 home, the association said.
In the San Francisco Bay area, meanwhile, only 23 percent of households reported income of at least $132,300, the minimum to purchase a home priced at $660,660.
Compliments of:
California Association of Realtors: www.car.org
By ALEX VEIGA, AP Business Writer
(02-19) 12:13 PST Los Angeles (AP) --
Frustrated California renters take heed: A trade group says it's getting easier for people to afford their first home.
With home prices in a downward spiral in many once-booming areas, the percentage of California households that can afford to finance an entry-level home increased in the last three months of 2007 compared to the same period a year earlier, the California Association of Realtors said Tuesday.
The trade group for real estate agents calculates affordability based on the minimum household income required to make a 10 percent downpayment and secure an adjustable interest rate loan at 6.21 percent.
Some 33 percent of the households in the state met those guidelines in the fourth quarter — up from 25 percent in the same three months of 2006, the association said.
Buyers needed to earn $82,200 to afford financing of $411,170, the typical statewide price for an entry-level home during the quarter, the trade association estimated.
The monthly payment for such a purchase, including taxes and insurance, was $2,740, the association said.
An entry-level home was defined as one priced at about 85 percent of the median home price in an area.
The most affordable area of the state during the quarter was the desert north of Los Angeles, where some 54 percent of households met the association's $43,800 annual income threshold to finance an entry-level home priced at $218,880.
Sacramento County was next, with 53 percent of households within the income range needed to afford a home priced at $252,920.
The least affordable area was the Central Coast region of Monterey, where only 20 percent of households earned the $118,200 needed to finance an entry-level home at $591,200.
In Los Angeles County, 27 percent of households earned the $86,700 a year needed to buy a home priced at $433,200.
Some 46 percent of households in Riverside and San Bernardino counties, which have been hit particularly hard by rising foreclosures and falling home values, earned $57,600 a year, enough to finance a $287,330 home, the association said.
In the San Francisco Bay area, meanwhile, only 23 percent of households reported income of at least $132,300, the minimum to purchase a home priced at $660,660.
Compliments of:
California Association of Realtors: www.car.org
Tuesday, February 19, 2008
NAR's Economist's Commentary!
Refueling the Housing Bubble?
By NAR Chief Economist Lawrence Yun
The Federal Reserve has been aggressively cutting rates recently and the question is being raised about parallels to the past. Back in 2001, in the aftermath of the internet stock bubble collapse and the September 11 terrorist attacks, Alan Greenspan — then the Fed chairman — made deep cuts in interest rates in order to stave off a possible economic recession. Many also blame Mr. Greenspan for having fueled the housing market bubble and subsequent collapse by keeping the rates too low for too long.
Now in early 2008, with the economy possibly heading into a recession — as evidenced by the GDP growth rate slowing from 4.1% in third quarter to 0.6% in the fourth quarter — the current Fed Chair, Ben Bernanke, has been following a very similar step of sharply cutting fed funds rates in order to revive economic growth — partly by making home buying financially enticing. Though there is never a direct correction between the Fed funds rate and mortgage rates, which are outside of the Fed's control and determined by the global bond market, the current 30-year mortgage rates have come down to essentially 45-year low levels. Aside from a few months in 2003, mortgage rates have never been this low since the early 1960s. A drop in the average mortgage rate from nearly 7% in mid-2005 to the current 5.7% would reduce monthly mortgage payments from $1330 to $1160 on a $200,000 mortgage. The average savings would be $340 per month or $4,000 per year on a $400,000 mortgage.
Therefore, could the Fed be simply refueling the bubble by dangling financial incentives to buy a home? Well, let's replay the key factors related to the recent bubble-collapse and see whether the same behavioral patterns will reemerge. Keep in mind that there are significant local market variations, but the markets that had the huge swings followed the below pattern:
The Fed started cutting rates from 2001 — with the Fed funds rate eventually reaching 1% by mid-2003.
The mortgage rate fell to 5.5% by the summer of 2003 from 8% in 2000. ARMS rates fell from 7% to 3.5% over the same period.
Housing demand rose with existing and new home sales hitting successive high marks in 2003, 2004, and 2005. Inventory fell as a result.
Home prices accelerated. For example, in the D.C. region home prices more than doubled from $204,000 to $426,000 from 2001 to 2005. Homeowners' net worth leapt by over $200,000 as a result — a figure many would considered good lifetime savings.
Given the general weakness in the stock market and relative "easy" wealth gains for real estate owners — there was an increasing view of homeownership and real estate as a financial play rather than in terms of family and housing needs considerations.
Housing demand ran exceptionally high, but the demand could only be realized if people could get the financing.
Global capital providers were chasing after high yields and were eager to provide the financing because…
Ratings agencies gave their blessing on subprime products, giving the impression that these were 'safe' alternatives.
Moody's, Standard & Poor's, and other ratings agency raked in revenue by giving out top Triple-A ratings (an inherent conflict of interest exists when ratings agencies get their revenue from mortgage underwriters/securitizers… rather like a professor who gives out a lot of "A" grades will draw more tuition paying students to his class).
With funding plentiful, subprime and no documentation loans proliferated — if you had a heartbeat, you could get a loan.
Housing demand was further pushed higher as herds of house-flippers entered the market, and home prices accelerated in those markets. Prices grew by leaps and bounds in markets of around 70% in short two years — places like Las Vegas, Miami, and Phoenix, and Sacramento.
Inventories were pushed down to exceptionally low levels and homebuilders could not keep up with demand.
From late 2004, the Fed began to tighten and mortgage rates climb in 2005.
Housing demand naturally fell off.
Inventory quickly built — from a combination of lower demand, builders continuing to build at a high pace, and some speculators/flippers realizing that the period of easy price gains was coming to an end.
Rising inventory held back price gains.
Price stagnation no longer permitted mortgage refinancing. Flippers/speculators started carrying burdensome mortgage costs — some begin to simply walk away — pushing inventory higher.
Non-flippers — primary homeowners, who took out subprime loans, also faced the same price stagnation, but also the resetting higher interest rates. Refinancing is not possible and some have been forced to foreclose
More and more flippers/speculators and homeowners are unable to carry the high resetting interest rates and simply walk away. Lenders begin to write-down loan losses.
After the fact and very late, the ratings agencies stated that subprime loans are no longer Triple-A quality.
Global capital providers stopped funding subprime loans and the subprime market came to a halt.
Global capital providers, having been burned, also stop funding any U.S. mortgages other than those with Fannie and Freddie backing. The jumbo loan market, therefore, struggles.
From mid-2007, a lack of market liquidity and economic slowdown forces the Fed to cut rates.
Conforming mortgage rates again fall to historic lows, but not jumbo loan rates.
The Fed has been and is further ready to make deeper cuts.
Going back to our earlier question: is the current action by the Fed simply trying to replay the same volatile game? The answer is an unambiguous NO. The same game is played out because the global capital providers will not be taken for fools again. After being burned, German mutual funds or the Chinese government or the Florida's teacher pension fund will no longer buy toxic subprime loans. Without the loans, homebuyers simply cannot enter the marketplace independent of their desires. We are back to the careful underwriting standards of verifying people's income, requiring escrow accounts, and back to thoroughly checking borrower's ability to repay the loan.
However, the current low interest rate policies of the Fed are a big help to housing because low rates can begin to furnish genuine potential homebuyers with the financial capacity to think seriously about becoming a homeowner. Furthermore, the rate cut is lessening the degree of forthcoming ARM resets, thereby lessening the burden the current subprime loan borrower faces. So the current policy of Ben Bernanke will help stabilize the housing market.
The Federal Reserve, however, should be mindful to not lower the fed funds rate too greatly. Inflation is expected to head lower in 2008 but too much money can fuel inflationary pressures. If that happens, 30-year mortgage rates will RISE, and therefore, choke off any housing recovery. A careful balance must be taken regarding how low to bring down the fed funds rate.
Though some in the blogosphere have figured Alan Greenspan as one of the key persons to blame for the current housing mess, I do not blame Mr. Greenspan. I believe there is plenty of blame to go around due to other factors. Global capital providers misunderstood and were simply not careful about purchasing securities composed on little income documentation and of risky-borrowers. Mortgage originators just originated loans to anyone including to suspicious borrowers because they had no skin in the game (see the recent academic article on this topic by a group of professors from the University of Chicago). There were also many books about how to endlessly profit from real estate. Consumers — particularly the flippers/speculators — also need to bear some of the blame.
But the biggest blame in my view goes to Moody's and Standard & Poor's — the rating agencies. If they had properly assessed the risk as is their job, then global capital would have never reached subprime homebuyers and flippers. The housing boom would have stopped dead in its tracks. We do not yet know how much of the ratings firms' assessment were clouded by their financial interest in giving out easy Triple-A grades. Many workers at Moody's and Standard & Poor's took home hefty bonus checks when revenue skyrocketed from providing high ratings.
It is also fine for people to point the finger at me. In a fast changing market conditions, I too have been off on my forecast. I knew that the boom was clearly unsustainable and I made the forecast in early 2007 that home prices were likely to experience a price decline on a national level for the first time since the Great Depression. The national median home price indeed fell by 1.4%. I believe I downgraded my forecast for ten or so straight months in 2007 as it was strongly pointed out to me. At the same time, the Blue Chip consensus forecast, comprised of about top 50 private forecasters, including forecasts by Merrill Lynch, Goldman Sachs, UCLA, and the like — had also downgraded the housing forecast by more than 20 straight months. Forecasting is never perfect. Forecasts are bound to be off but the forecaster's job is to make the best prognosis given the available information at the time. The readers should always view any forecast with caveat emptor.
But back to the original question: Will we experience a re-emergence of a housing boom from the current easy money policy by the Fed? The answer is no because as Abraham Lincoln said — fool me once, shame on you. Fool me twice, shame on me. It will be impossible to part global capital providers' money with another foolish investment.
By NAR Chief Economist Lawrence Yun
The Federal Reserve has been aggressively cutting rates recently and the question is being raised about parallels to the past. Back in 2001, in the aftermath of the internet stock bubble collapse and the September 11 terrorist attacks, Alan Greenspan — then the Fed chairman — made deep cuts in interest rates in order to stave off a possible economic recession. Many also blame Mr. Greenspan for having fueled the housing market bubble and subsequent collapse by keeping the rates too low for too long.
Now in early 2008, with the economy possibly heading into a recession — as evidenced by the GDP growth rate slowing from 4.1% in third quarter to 0.6% in the fourth quarter — the current Fed Chair, Ben Bernanke, has been following a very similar step of sharply cutting fed funds rates in order to revive economic growth — partly by making home buying financially enticing. Though there is never a direct correction between the Fed funds rate and mortgage rates, which are outside of the Fed's control and determined by the global bond market, the current 30-year mortgage rates have come down to essentially 45-year low levels. Aside from a few months in 2003, mortgage rates have never been this low since the early 1960s. A drop in the average mortgage rate from nearly 7% in mid-2005 to the current 5.7% would reduce monthly mortgage payments from $1330 to $1160 on a $200,000 mortgage. The average savings would be $340 per month or $4,000 per year on a $400,000 mortgage.
Therefore, could the Fed be simply refueling the bubble by dangling financial incentives to buy a home? Well, let's replay the key factors related to the recent bubble-collapse and see whether the same behavioral patterns will reemerge. Keep in mind that there are significant local market variations, but the markets that had the huge swings followed the below pattern:
The Fed started cutting rates from 2001 — with the Fed funds rate eventually reaching 1% by mid-2003.
The mortgage rate fell to 5.5% by the summer of 2003 from 8% in 2000. ARMS rates fell from 7% to 3.5% over the same period.
Housing demand rose with existing and new home sales hitting successive high marks in 2003, 2004, and 2005. Inventory fell as a result.
Home prices accelerated. For example, in the D.C. region home prices more than doubled from $204,000 to $426,000 from 2001 to 2005. Homeowners' net worth leapt by over $200,000 as a result — a figure many would considered good lifetime savings.
Given the general weakness in the stock market and relative "easy" wealth gains for real estate owners — there was an increasing view of homeownership and real estate as a financial play rather than in terms of family and housing needs considerations.
Housing demand ran exceptionally high, but the demand could only be realized if people could get the financing.
Global capital providers were chasing after high yields and were eager to provide the financing because…
Ratings agencies gave their blessing on subprime products, giving the impression that these were 'safe' alternatives.
Moody's, Standard & Poor's, and other ratings agency raked in revenue by giving out top Triple-A ratings (an inherent conflict of interest exists when ratings agencies get their revenue from mortgage underwriters/securitizers… rather like a professor who gives out a lot of "A" grades will draw more tuition paying students to his class).
With funding plentiful, subprime and no documentation loans proliferated — if you had a heartbeat, you could get a loan.
Housing demand was further pushed higher as herds of house-flippers entered the market, and home prices accelerated in those markets. Prices grew by leaps and bounds in markets of around 70% in short two years — places like Las Vegas, Miami, and Phoenix, and Sacramento.
Inventories were pushed down to exceptionally low levels and homebuilders could not keep up with demand.
From late 2004, the Fed began to tighten and mortgage rates climb in 2005.
Housing demand naturally fell off.
Inventory quickly built — from a combination of lower demand, builders continuing to build at a high pace, and some speculators/flippers realizing that the period of easy price gains was coming to an end.
Rising inventory held back price gains.
Price stagnation no longer permitted mortgage refinancing. Flippers/speculators started carrying burdensome mortgage costs — some begin to simply walk away — pushing inventory higher.
Non-flippers — primary homeowners, who took out subprime loans, also faced the same price stagnation, but also the resetting higher interest rates. Refinancing is not possible and some have been forced to foreclose
More and more flippers/speculators and homeowners are unable to carry the high resetting interest rates and simply walk away. Lenders begin to write-down loan losses.
After the fact and very late, the ratings agencies stated that subprime loans are no longer Triple-A quality.
Global capital providers stopped funding subprime loans and the subprime market came to a halt.
Global capital providers, having been burned, also stop funding any U.S. mortgages other than those with Fannie and Freddie backing. The jumbo loan market, therefore, struggles.
From mid-2007, a lack of market liquidity and economic slowdown forces the Fed to cut rates.
Conforming mortgage rates again fall to historic lows, but not jumbo loan rates.
The Fed has been and is further ready to make deeper cuts.
Going back to our earlier question: is the current action by the Fed simply trying to replay the same volatile game? The answer is an unambiguous NO. The same game is played out because the global capital providers will not be taken for fools again. After being burned, German mutual funds or the Chinese government or the Florida's teacher pension fund will no longer buy toxic subprime loans. Without the loans, homebuyers simply cannot enter the marketplace independent of their desires. We are back to the careful underwriting standards of verifying people's income, requiring escrow accounts, and back to thoroughly checking borrower's ability to repay the loan.
However, the current low interest rate policies of the Fed are a big help to housing because low rates can begin to furnish genuine potential homebuyers with the financial capacity to think seriously about becoming a homeowner. Furthermore, the rate cut is lessening the degree of forthcoming ARM resets, thereby lessening the burden the current subprime loan borrower faces. So the current policy of Ben Bernanke will help stabilize the housing market.
The Federal Reserve, however, should be mindful to not lower the fed funds rate too greatly. Inflation is expected to head lower in 2008 but too much money can fuel inflationary pressures. If that happens, 30-year mortgage rates will RISE, and therefore, choke off any housing recovery. A careful balance must be taken regarding how low to bring down the fed funds rate.
Though some in the blogosphere have figured Alan Greenspan as one of the key persons to blame for the current housing mess, I do not blame Mr. Greenspan. I believe there is plenty of blame to go around due to other factors. Global capital providers misunderstood and were simply not careful about purchasing securities composed on little income documentation and of risky-borrowers. Mortgage originators just originated loans to anyone including to suspicious borrowers because they had no skin in the game (see the recent academic article on this topic by a group of professors from the University of Chicago). There were also many books about how to endlessly profit from real estate. Consumers — particularly the flippers/speculators — also need to bear some of the blame.
But the biggest blame in my view goes to Moody's and Standard & Poor's — the rating agencies. If they had properly assessed the risk as is their job, then global capital would have never reached subprime homebuyers and flippers. The housing boom would have stopped dead in its tracks. We do not yet know how much of the ratings firms' assessment were clouded by their financial interest in giving out easy Triple-A grades. Many workers at Moody's and Standard & Poor's took home hefty bonus checks when revenue skyrocketed from providing high ratings.
It is also fine for people to point the finger at me. In a fast changing market conditions, I too have been off on my forecast. I knew that the boom was clearly unsustainable and I made the forecast in early 2007 that home prices were likely to experience a price decline on a national level for the first time since the Great Depression. The national median home price indeed fell by 1.4%. I believe I downgraded my forecast for ten or so straight months in 2007 as it was strongly pointed out to me. At the same time, the Blue Chip consensus forecast, comprised of about top 50 private forecasters, including forecasts by Merrill Lynch, Goldman Sachs, UCLA, and the like — had also downgraded the housing forecast by more than 20 straight months. Forecasting is never perfect. Forecasts are bound to be off but the forecaster's job is to make the best prognosis given the available information at the time. The readers should always view any forecast with caveat emptor.
But back to the original question: Will we experience a re-emergence of a housing boom from the current easy money policy by the Fed? The answer is no because as Abraham Lincoln said — fool me once, shame on you. Fool me twice, shame on me. It will be impossible to part global capital providers' money with another foolish investment.
Easing Your Children's Fears When Making a Move!
Helping Your Children Move to Their New Home!
If you’re relocating to a new city, you should try to make the transition as smooth as possible for your children. The best thing you can do is to keep them informed. Even if you think they don’t care or won’t fully understand the details, keep them as informed as possible so they feel secure about the situation. Children understand much more than some of us give them credit for. Getting them on-board for the move will help to make the relocation less stressful for the whole family.
The greatest fear preschool children typically have is that they will somehow be left behind. If you need to leave your children for a short time to search for your new home or to orient yourself to the new location, reassure them that you will be back. It may help if you bring them back something from the new location. Consider assigning them a task to complete before you return, such as packing some of their toys in boxes. This will help them feel involved in the move.
Elementary children may fear how the move will disrupt their everyday lives. Take pictures of the new location and of spots that you know they will enjoy, such as parks and pizza parlors. If possible, take them to the new location before the move to let them get a first-hand feel for the place and take the mystery out of it. Nothing is scarier to kids than the unknown.
Teenagers may be worried about fitting in and making new friends at their new school. To help ease their fears, find out as much as you can about the high school they will be attending. Make special note of the local trends, sports teams and school clubs.
Again, if possible, visit the new town before the move and visit the school that each child will attend. Schedule a meeting with the principal and teachers before their first day of school. If you can’t do it before the move, make sure to do it as soon as possible after the move. Once your children start to make new friends, encourage them to bring their new classmates home to visit.
Play tourist in your new location. This is a great way to learn the area and makes the children feel like it is a vacation. It will take time to make new friends so the touring keeps them busy and less likely to dwell on the loss of old friends.
Ready to select a REALTOR®….I am here to help!
Jean Powers
Broker Associate, CRS, ASP, LTG, PMN, SRES
Windermere Welcome Home
510.908.9002
Toll Free: 800.378.7300
Successfully Serving Alameda Since 1984
If you’re relocating to a new city, you should try to make the transition as smooth as possible for your children. The best thing you can do is to keep them informed. Even if you think they don’t care or won’t fully understand the details, keep them as informed as possible so they feel secure about the situation. Children understand much more than some of us give them credit for. Getting them on-board for the move will help to make the relocation less stressful for the whole family.
The greatest fear preschool children typically have is that they will somehow be left behind. If you need to leave your children for a short time to search for your new home or to orient yourself to the new location, reassure them that you will be back. It may help if you bring them back something from the new location. Consider assigning them a task to complete before you return, such as packing some of their toys in boxes. This will help them feel involved in the move.
Elementary children may fear how the move will disrupt their everyday lives. Take pictures of the new location and of spots that you know they will enjoy, such as parks and pizza parlors. If possible, take them to the new location before the move to let them get a first-hand feel for the place and take the mystery out of it. Nothing is scarier to kids than the unknown.
Teenagers may be worried about fitting in and making new friends at their new school. To help ease their fears, find out as much as you can about the high school they will be attending. Make special note of the local trends, sports teams and school clubs.
Again, if possible, visit the new town before the move and visit the school that each child will attend. Schedule a meeting with the principal and teachers before their first day of school. If you can’t do it before the move, make sure to do it as soon as possible after the move. Once your children start to make new friends, encourage them to bring their new classmates home to visit.
Play tourist in your new location. This is a great way to learn the area and makes the children feel like it is a vacation. It will take time to make new friends so the touring keeps them busy and less likely to dwell on the loss of old friends.
Ready to select a REALTOR®….I am here to help!
Jean Powers
Broker Associate, CRS, ASP, LTG, PMN, SRES
Windermere Welcome Home
510.908.9002
Toll Free: 800.378.7300
Successfully Serving Alameda Since 1984
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