Those new market stats

The RMLS just released statistics for the month of January.  It is nice to see a few more houses coming on the market, as buyers are out in force.  We also see a consistent trend in slow, steady price increases.

 The median sales price over the previous twelve months increased  7.3%  to $236,000 up from $219,000.  In January, pending sales rose a whopping 37.7% over the previous month.  Closed sales, reflecting seasonal slowing of selling activity over the holidays, dipped to 1344 in January 2013 when compared with 1760 in December 2012

Housing inventory rose to 4.7 months, up from 3.6 months in December 2012.  That is, at the current rate of sales, it will take 4.7 months to sell out the inventory.

If you've been thinking about selling, get in touch and we'll see where the value is on your home.  There are plenty of buyers out there looking to make a move.  If you've been waiting to buy, don't wait too much longer. We don't want you priced out by increasing prices and interest rates - unless your income is also going up.

Leslie Jones 503-312-8038. leslievjones@gmail.com

Read the full RMLS report.

That popular FHA financing

For years, FHA (Federal Housing Administration) have long been a staple of first time and lower income home buyers.  In general, FHA loans allow a buyer to have lower credit scores and a bit more debt, along with lower down payments, than conventional loans.

As you might imagine, the housing crisis was especially hard on the Federal Housing Administration.  The National Association of Realtors reports that an independent audit shows the  FHA has an economic value of negative $13.48 billion.  Over the past few years FHA has been making a variety of slight adjustments; increases in their mortgage insurance and funding fees.  This spring brings another wave of changes in an effort to stem the tide.

The two most notable changes are:

 1) Raising the annual mortgage insurance premium by 10 basis points, or about $13 per month on the average loan.

2) Making the mortgage insurance permanent; meaning MIP can no longer be removed once an owner achieves 20% equity.   Keep in mind though, the average FHA loan turns over quicker than conventional loans as they are often used to buy that first, starter house.

These changes to FHA are a balancing act; address FHA's financial strength (or lack of it) without putting a damper on the now recovering housing market.

Read the FHA report here.

A Cautionary Sidewalk Tale

A friend of mine has a rental property in a nice, close-in, walkable Portland neighborhood.  She got a letter from an attorney this week.The attorney is representing a woman who tripped on my friend's sidewalk in August and broke her wrist. In February, this is the first my friend had heard of  it.  Would my friend please provide her insurance company contact information so the claim could be made and processed.  Really?!  Just like that?

Over the years, my husband and I have done, or paid for, LOTS of sidewalk repairs and replacement, as mandated by the City of Portland.,  We always groan, and get snippy about all the more egregious sidewalk issues we see in walking our neighborhood.  And yes, we give a nod to the safety aspects of good sidewalks.

Back to my friend.  Her insurance agent had been out to the property in the last few years and they had looked at a bump, or separation in the sidewalk.  He suggested, rather than going to the expense to replace the offending sections, they mix up some concrete and do sort of a patch or small ramp to alleviate the trip hazard.  Tempting... and this is what they did.

So when my friend got the letter,. she didn't even need to go look at the sidewalk.  She new exactly the spot. Ugh.  I'm not sure how it will pan out, but I'm guessing some money will change hands, her insurance will go up, and they'll most likely end up doing a larger sidewalk repair.

Sage advice?  I don't know.  One could spend a fortune defensively replacing sidewalks.  Portland has miles of aging sidewalks, kind of like our miles of aging sewers.  But unlike our miles of aging sewers, the public has an expectation that your sidewalk will be...walkable.  As you start your spring yard clean up, take a look, with a critical eye, at your sidewalks.  See anything that might need attention?

Call me if you need a referral to some good sidewalk contractors.  Don and I  just had sidewalks done this fall and know some decent contractors.  Oh,and if the City of Portland calls out your sidewalk, they don't give you much time to get the project handled before they have it done and charge you.  Just so you know.

Safety Measures or a Crutch?

My dog, Mollie, and I put a good number of miles in walking our neighborhood.  She, at times, has been a very reactive dog; needing to bark at every dog we see. While she is in general a good walker, (doesn't pull on the leash and such) she can get a bit too interested in stinky things along the way. Over time, it has become habit for me to always have dog treats along, and to use them for distraction from other dogs or to get her back on track.

Yesterday, we set off on our first walk of the day, and after a few blocks I realized I had no treats!  Ack.  I almost turned back.  That is how strong my reliance on those treats can be.  Mollie realized, rather quickly, that I had no treats. Ack.  We proceeded to have the most lovely walk!  I was more focused on keeping her on track, and caught any unwanted behavior before she settled in to it. It made me realize  how many of Mollie's behaviors had become about getting the treat.  Right?  If she gets to snuffly looking for cat poo in leaves, she'll get a treat.  Talk about a win/win. Either cat poo or a treat!  We met two other dogs on our side of the street, whom we greeted politely and moved on.

As a parent, we've all had that crutch. If "it" gets really bad, I can always use the favorite blanket, bottle, nursing etc.   Indeed, having a Plan B is a wise parenting strategy.

I am one who likes to have a contingency, or next thing, in reserve. When camping, I always want one more warm layer, so if it gets really bad I can go to that.  I did though recently relent and put on that last layer. Ahhh. Warm and cozy.  Or how about when I quit smoking many years ago.  I carried a pack of cigarettes for almost a year.  Temptation?  Nope, my back up.  If "it" got really bad, I'd have cigarettes with me.  I never did smoke one.

Contingency? Plan B? Crutch?   Do these things allow us to be sloppy in our endeavors since we have a back up plan?   How does having a contingency plan affect your behavior?  And would you do a better job without that back up?

Old Beauty, New Look

 A year or so ago I showed this grand old gal on Mt. Tabor.  As sometimes happens, she had been bought by folks with big plans, whose plans changed.  Shelled out, the house was down to the studs in most rooms, with an aging foundation and quirky floor plan.

But sitting back on an over sized lot, looking west toward the city, you know this house wasn't done living.  In time, it was bought and major work commenced:

Wow!  I showed the restored version this last week.  The builder had a good sense of what to salvage and what to bring in new. They kept the lines of the original house, and built out a few missing pieces.  The floor plan is very comfortable, with gracious spaces including a roomy finished basement and third floor, in addition to the three bedrooms and two baths on the second floor.  The classic kitchen is a cooks dream and I loved the huge outdoor room off the back and brick fire pit in back.

We are seeing lots of infill houses, newly built these days. And there is something about a new house; that smell and the modern floor plan.  I should know, I live in one.  We are also seeing a few rare beauties restored.  They have a certain grace and style the new houses just don't.  Builders, with care, can communicate the soul of an old house while delivering the ease, convenience and energy efficiency of a new house.

You can see the listing for the restored house here. And remember, I'd be glad to show you this, or any other old beauties in which you might be interested.

The RMLS just released statistics for the month of December, and wow.  It has sure felt as though there are hardly any houses to sell and now I see why. There are only 3.6 months of inventory.  Meaning, at the current rate of sales we would sellout the inventory in 3.6 months.  The last time inventory was this low, it was August 2006 and we were in the middle of a crazy boom.

Not quite the case this year.  Instead, buyers are back in the market with a vengeance and interest rates are wonderfully low (if you are a borrower), while sellers think they may not be able to sell for what they'd like.  Or can they?

The median year to date sales price rose 6.3% from December 2011 to December 2012 to $235,000 when compared with a median year to date sales price of $221,000 in December  2011.

Looking at the past year, 2012 brought us higher prices, more transactions, fewer houses on the market and shorter market times.  It also brought frustrated buyers vying for too few houses.  In 2013 we hope to see more houses on the market (yours?).  We expect to see fewer bank owned listings and short sales. We also expect to see some interest rate increases as Fannie Mae drives some fees and costs into the lending equation.

If you've been thinking about selling, get in touch and we'll see where the value is on your home,  If you've been waiting to buy, don't wait too much longer. We don't want you priced out by increasing prices and interest rates - unless your income is going up too.

Leslie Jones 503-312-8038. leslievjones@gmail.com

Read the full RMLS report.

The fiscal cliff deal and real estate

So we did go over the fiscal cliff for a day.  I survived, and am guessing you did also. I'm shying away from over analysis on this as the news media has that covered.  The National Association of Realtors provided members a summary.  I have culled a few morsels below.

 In general, real estate related provisions weren't earth shaking, with most affecting high income "filers" (defined varyingly as individuals earning more than $250,000 or $400,000 depending upon the provision). 

 Mortgage Cancellation Relief is extended for one year to January 2014.  In general this exempts taxes being paid on a "forgiven" debt such as a short sale.

The Deduction for Mortgage Insurance Premiums for filers making below $110,000 remains and was made retroactive to cover 2012.

Energy Efficient Tax Credit of 10% up to $500 for homeowners  making energy efficient improvements to existing homes.

Capital Gains rate stays at 15% for folks earning up to $400,000 (individuals) and $450,000 for joint filers.  Above that, capital gains will be taxed at 20%.  Thankfully the $250,000/$500,000 exclusion for the sale of a principal residence remains in place.

The "Pease" limitation on itemized deductions for high income folks applies to those earning $250,000 ($300,000 for joint filers).  Such filers gradually lose the value of heir total itemized deductions up to a total of a 20% reduction.  These limits can and will impact the mortgage interest deduction to an extent, but will have far less result than a hard dollar or percent deduction cap.

From a real estate point of view, I'm glad to see this package. It does a good job of preserving some elements that should help to keep the housing based recovery alive, while placing a bit of burden on higher earners.  In the weeks to come I'm sure we'll see LOTS of analysis; consider this a mere tidbit.