RMRE's May News

Flathead home sales rebound

ERIKA HOEFER/Daily Inter Lake

Flathead County has seen a rebound in housing sales this year, but whether that momentum will be sustained may depend on government incentives and interest rates in the coming months.

Real estate statistics released by Kelley Appraisal on Wednesday show an 83.5 percent growth in overall residential sales between January and March over the same period in 2009.

There were 211 residential sales in the first three months this year compared to 115 a year ago. Some of the sales increase, however, was due to foreclosures.

The average price tag crept up to $300,423 during the first three months of the year, rising 30.4 percent over 2009 sales figures.

That price is well below the 2007 peak of $346,272.

Jason Mann of Mann Mortgage in Kalispell said that for the first time since the start of the housing bust, he’s working on financing homes still under construction. That’s big, he said. “We haven’t seen that in the last two years.”

Activity within the housing market has increased significantly recently in response to the looming end to the federal homebuyer tax credit. The credit expired at the end of April.

Just under half of the home deals in Flathead County so far this year closed in March. But as the cutoff deadline looms, it is uncertain whether sales growth can be sustained.

“There is no feeling yet that the credit will be extended a second time,” Mann said. “That’s cause for concern.”

On Thursday, Freddie Mac put the national average for a 30-year fixed rate mortgage at 5.21 percent. One week ago, it was 5.08 percent. That’s the highest since mid-August, when the average rate was 5.29 percent. Analysts are forecasting rates as high as 6 percent by 2011.

The average rate on a 15-year fixed-rate mortgage Thursday was 4.52 percent, up from 4.39 percent last week.

According to the National Association of Realtors, for every 1 percentage point increase in rates, 300,000 to 400,000 would-be buyers are priced out of the market in a given year.

Mann said the Federal Reserve’s program of purchasing mortgage-backed securities caused rates to be artificially lower recently. That program ended March 31, causing rates to increase.

Federal Reserve Chairman Ben Bernanke said Wednesday that continuing problems in the housing market and high unemployment remain the biggest national economic challenges.

While he confirmed that the economy seems to have stabilized and may even be growing, he admitted to seeing no evidence of a “sustained recovery” in the housing market.

Rising foreclosures are tempering any sort of rebound.

The Kelley Appraisal statistics show Flathead County notices of trustee sales, or pre-foreclosure warnings, have risen 57 percent between January and March 2010 over the same period a year ago.

A record number of 132 notices of trustee sales were recorded last month, compared to 35 in March 2008.

Actual foreclosures in Flathead County more than doubled from January to March 2010 over the same period last year.

Foreclosure sales and short sales made up 40 percent of all residential sales for Flathead County so far this year.

With the soaring number of notices of trustee sales filed in March, the number of foreclosures is expected to rise significantly the rest the year.

MAY NEWS BRIEFS:

Your Vacation in Lights: Whitefish ski resort in Montana serves as honeymoon spot for Arlington couple

Victoria Sievers of Arlington is the latest contributor to Your Vacation in Lights, in which we invite Travel section readers to dish about their recent trips. It's a big, confusing travel world out there, and you can help your fellow travelers navigate it. You won't win a million dollars if your story is featured; in fact, you won't win anything but the thanks and admiration of your fellow readers. To file your own trip report, see the fine print below.

Read more of Victoria’s story at: http://www.washingtonpost.com.

Coalition Backs Measure to Prevent Real Estate Transfer Tax

A small group gathered on the steps of the old Flathead County courthouse building in Kalispell earlier this week to kick off an effort to put a measure on the ballot in November that would prohibit a tax on real estate sales and transfers.

Read more on tax at: http://www.flatheadbeacon.com

Kayaking on Lake McDonald in Glacier National Park

Photo by Hunter Homes, Realtor

Rocky Mountain Real Estate

HGTV's FrontDoor.com Identifies Top 10 Things First-Time Homebuyers Should Know

Buying a home for the first time can be complex. To avoid mistakes and make a smart purchase, do the homework and know what to expect. To help start the process, HGTV's FrontDoor.com identifies the top 10 important points every first-time buyer must know.

1. Just because it's a buyer's market doesn't mean you should buy right now. Don't let the lucrative market dictate a buying decision if the time isn't absolutely right. Potential homebuyers need to ask themselves if they have a good credit score, if their job is secure and if they can stay in the home for a few years. If the answer to these questions is "no," it might make more sense to wait until life and finances are more stable.

2. The cost of owning a home is more than just the purchase price. On top of a mortgage payment, there are several monthly fees and expenses any first-time buyer should consider when becoming a homeowner: insurance, property taxes, utilities and maintenance. Think about scaling back the home price in order to better budget for the entire package.

3. Programs are out there to help first-time buyers. A sizeable down payment is great to have for a home purchase, but not everyone can afford to fork over 20 percent upfront. Fortunately, there are many federal, state and local programs geared toward helping first-time homebuyers with down payments, interest rates and loan terms sure to make the whole process and affordability a bit easier.

4. Foreclosures and short sales present great deals, but proceed with caution. Buying a foreclosed or short sale home can be a risky proposition for a first-time buyer. Foreclosures are often sold "as-is," while a short sale transaction can be lengthier and more complicated than a typical home purchase. First-timers should consult an agent or attorney with specialization in these areas.

5. Getting pre-approved for a loan gives you more buying power. Obtaining lender pre-approvals are important because it establishes a homebuyer's maximum purchase price, shows sellers that the buyer is serious about buying a home and lets the homebuyer compare interest rates and terms to find the best deal.

Read more tips at http://www.frontdoor.com/top10

What's the deal with this housing market?

By KATHLEEN SCHULTE CEO, NMAR

Daily inter Lake - Friday, April 16, 2010

Science Digest 1948 quote, "Houses cost too much for the mass market. Today's average price is around $8,000 - out of reach for two-thirds of all buyers."

Nations Business 1977 quote, "The median price of a home today is approaching $50,000... Housing experts predict price rises in the future won't be that great."

Money Magazine 1985 quote, "The golden age of risk-free run-ups in home prices is gone."

This morning I heard this question, "Will the real estate market dig itself out of the snow bank?"

The first three quotes proved questionable as housing markets strengthened and prices continued to go up. The question from this morning remains to be answered. We hear news from the media regularly on distressed markets and sales. Most of this news comes from metropolitan areas. Housing inventories that include foreclosures, short sales, REOs and other distressed sales vary greatly around the country. We are bombarded with news on the ratio of homes needed to serve a market area with some claiming housing inventories are enough to supply buyers for upwards of 10-plus years.