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October 31, 2009

Home buyer tax credits: Are you in?

I asked you to give the Senate's proposed tax credits for first-time and repeat home buyers a thumbs up, down or sideways, and oh boy, you responded. As of 10 p.m. last night, nearly 500 people had weighed in on the Wonk poll.

Almost 80 percent of voters offered a thumbs up. Five percent don't love it or hate it and gave it a sideways thumb. The rest say no thanks.

Some commenters wondered what personal situations were influencing these choices. Sounds like a poll:

Need a refresher? The tentative Senate deal would extend the $8,000 first-time home buyer tax credit -- you could sign a contract through April 30 as long as you closed by June 30. It would also create a new tax credit of up to $6,500 -- starting Dec. 1 -- for repeat buyers who have been in their current homes for at least five years and are getting a new primary residence.

For more details (income limits, price limits, etc.), read this home buyer tax credit post.

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (7)
Categories: First-time buyer tax credit

October 30, 2009

Home buyer tax credit: More details and a lot of angst

More details about the tentative Senate agreement to extend and expand the first-time home buyer tax credit:

--As you probably already heard, the credit would be available to buyers signing contracts through April 30 and closing by June 30. First-timers would continue to be eligible for up to $8,000. Other buyers could get up to $6,500, starting Dec. 1, if they've lived in their current home for at least five years.

--Income limits would be increased to $125,000 for individuals and $225,000 for couples, with the credits phasing out above those amounts.

--Repeat buyers must be getting a primary residence, not a vacation or investment property. But you're allowed to keep your current home.

--Eyeing a home priced above $800,000? You can't get this credit, the senators say.

--Read their lips: No more credits for 4-year-olds. First-time buyer tax credit fraud, including money funneled to preschoolers and to people who didn't actually buy anything, prompted senators to require that buyers be at least 18 and submit copies of their HUD-1 settlement statements when applying for the credit.

News of this extension and expansion touched off a firestorm of discussion here, and emotions of all sorts. Hope among some homeowners who could use $6,500. Frustration among those who would miss out under the proposed restrictions. Aggravation among renters who think credits are artificially propping up the market at taxpayers' expense.

A nameless reader who's rooting for passage wrote: "I bought a house 5 years ago and now it's worth way less then what i owe."

Lee opined, "I think the 5 year requirement is a bit excessive and a little discriminatory ... Why not 3 or 4 years? What about those who have had to move most recently to keep their jobs?"

Chase, who is trying to buy his second home because he's more than 60 miles away from his job, bemoans the fact that he and his wife have only been in their first home 3 1/2 years. "I really wished this program, if approved, would allow for any second time home buyers that has not already participated in the 'first time home buyer tax credit', even if it was phased out based on how long you had owned your home. For example 5 years = 6500, 4 = 5500, 3 years = 4500, etc..."

Krista writes, "We are neither first time homebuyers nor do we currently own a home. We took a big hit when we relocated two years ago on our house that we sold. We are renters right now. So if you want to stimulate the economy we should get tax breaks before those who already own. Where do we fit in??"

Kevin R said these comments -- plus more along the same lines -- were making him feel nauseated. "Too many people looking for a handout," he wrote.

Jelena, who has been looking for a house for a while now, says she's against the proposal even though she could qualify as a first-time buyer. In her opinion, "this is just prolonging the agony. Now the prices won't fall (read - adjust to the realistic level) for another year or so, but they will fall after all the tricks end eventually. Sadly, we really have to move soon and, as a result of this credit, now we'll have to face higher prices and, possibly, bidding wars."

But Darwin Rules, who frequently predicts here that home prices in the Baltimore area will fall to 1999 levels, is unfazed: "The higher you fly, the harder you fall. I'll just sit back and wait a bit longer for the inevitable carnage - will be a bit more tenderized after the harder landing."

Many of the comments were negative -- either of the "where's mine?" or "stop wasting money" variety. But as of last night, 80 percent of the people taking the Wonk poll gave the proposal a thumbs up. Five percent more opted for a thumbs sideways.

Wherever you stand on the issue, you'll probably get a laugh out of semiconscious's tongue-in-cheek reaction: "The government should just give us all money to buy homes. ... In fact, we should get money for cars, clothes, vegas vacations and a couple of Gulfstream jets."

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (60)
Categories: First-time buyer tax credit

October 29, 2009

First-time AND second-time home buyer credit?

Senators have cut a deal to extend and expand the popular first-time home buyer tax credit, though -- as The Wall Street Journal notes -- don't count on it just yet.

The tentative agreement worked out by Senate negotiators would allow buyers to sign contracts through April 30 as long as they close by June 30. First-timers would continue to be eligible for up to $8,000, while some repeat buyers could get up to $6,500.

Which repeat buyers? "The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years," the WSJ reports.

This hasn't yet passed the Senate, which is trying to decide which other economic measures to tack on to a bill, and it faces skepticism in the House. (As you'll recall, a number of people have allegedly claimed the credit despite not qualifying as first-time buyers, not being old enough to buy a house, not actually buying a house, etc.)

What do you think? Weigh in:

Posted by Jamie Smith Hopkins at 9:32 AM | | Comments (34)
Categories: First-time buyer tax credit, Polls

Foreclosures and financial protection

The Center for Responsible Lending, a watchdog group that predicted the national implosion of subprime loans before it happened, has a few numbers it wants you to think about:

--134,923: Maryland homeowners behind on their mortgages at the end of June.

--163,479: Maryland foreclosures it predicts between this year and 2012. (If that comes to pass, it would be one in every seven homes with a mortgage, according to my quick check of Census Bureau data.)

The center has numbers for every state -- under the headline "The Impact of Bad Lending" -- and it's reminding us of this now because it's trying to rally support for the proposed Consumer Financial Protection Agency.

As real estate columnist Kenneth Harney notes, the agency would oversee real estate and mortgage matters, plus "credit cards, debit cards, consumer loans, payday loans, credit reporting agencies, debt collection, stored-value cards and even investment advisory and financial advisory services, to name only part of the list."

No thanks, says the American Bankers Association. It issued a statement last week to say it has major concerns about "the very broad, ill-defined authority that is granted to this new agency that could be used to justify essentially any regulatory action."

(The bankers do think more regulatory muscle is needed -- just not flexing in their direction. In Congressional testimony, Edward L. Yingling with the bankers group said regulators ought to better enforce rules among "non-bank providers of financial services.")

Another proposal is for a "council of regulators" to keep an eye out for big economic risks like, let's see, an easy-money-fueled housing bubble. But Douglas Elliott of the Brookings Institution is skeptical this would work. He's quoted in a Forbes piece as saying he fears the regulators would be ineffective because we like our tulip manias, thank you very much:

"[Financial bubbles] are invariably quite popular. They arise because a large portion of the population accepts some tenet, such as the inevitability of rising house prices," says Elliott. Imagine if the council had tried to stop the housing bubble in 2005. Instead of averting the Great Recession, they'd be remembered as the regulators who murdered the great wealth-generating housing boom for no reason.

How would you suggest the country try to avoid bubbles in the future? More regulation? Less regulation? Different regulation?

Anti-bubble czar?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (3)
Categories: The foreclosure mess

October 28, 2009

Is "not as bad" the new good?

What qualifies as a housing-market turnaround? I'm curious what you all think as analysts digest Standard & Poor's newest Case-Shiller numbers, which show home prices falling more slowly than before.

Prices in August -- the numbers released Tuesday -- were down about 11 percent from a year ago among the 20 large metro areas Case-Shiller tracks (Washington among them, but not Baltimore). Compare that with a 19 percent year-over-year drop in January. And August prices were up slightly compared with the previous month.

Sean Hannon at the Seeking Alpha blog is not impressed. "If artificially low interest rates, home buyer tax credits, and foreclosure moratoriums could not drive prices higher and lead to a boom in home sales, what hope is there for a stimulus-free recovery?" he asks.

David M. Blitzer, chairman of the index committee at S&P, also had words of caution in a statement released with the numbers. He noted the planned expiration of the first-time buyer tax credit after Nov. 30 and "anticipated higher unemployment rates through year-end."

"Both may have a dampening effect on home prices," Blitzer said.

Forget the analyst-speak and macroeconomics for a moment. What do you want to see to convince you -- as a homeowner or renter -- that the housing market has recovered? Prices no longer dropping? Prices increasing a certain amount? Prices back to their 2006-or-so peaks? Or something else altogether?

And are you holding off on doing something -- buying, selling, renovating, job-hunting -- until you see it?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (24)
Categories: Housing stats

October 27, 2009

Home buying and selling in the Baltimore area

More buyers signed contracts for homes in the Baltimore metro area last month than a year earlier -- 32 percent more. You knew this already if you've been crunching numbers or hanging on my every word, but here's something I haven't mentioned already: Homes newly listed for sale last month were down slightly.

Fewer homes coming into the pipeline, more going out -- that's all to the good for would-be sellers.

We're not back to a pre-bubble balance between new contracts and new for-sale listings, though. Here's a graph that tells the tale, showing stats for the month of September throughout the decade:


Source: Baltimore Sun analysis of Metropolitan Regional Information Systems data

The number of new listings was 62 percent larger than newly signed contracts last month. By comparison, new listings were about 40 percent more numerous than new contracts in September of 2000 and 2001.

On the upside: 62 percent more new listings than new contracts is a lot closer to normal than 119 percent (September '08) or 165 percent (September '07).

The approximately 4,300 new listings that hit the market last month are also the lowest since 2003, when they dropped below 4,000.

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (2)
Categories: Housing stats

October 26, 2009

Remodeling in a down market

To remodel or not to remodel? It's a question that bedevils homeowners who don't have the answer staring them in the face, i.e. "might as well redo the master bathroom as long as we're fixing the flooding caused by the hole in the roof." Falling home values make the situation that much harder because many folks who might want to update their kitchen or build an addition don't have the equity to do it.

Thus renovations and maintenance work have taken a hit just like home sales. As Lorraine Mirabella reported in a Sunday story about the remodeling business:

Residential permits for alterations, additions and repairs have plummeted 27 percent in metro Baltimore this year through August, compared with the corresponding period in 2008, according to statistics from the Baltimore Metropolitan Council. The number of permits issued through August - 4,552 - has fallen by nearly half since 2006, when activity for the January-to-August period peaked at 8,250 permits, council statistics show.

Some remodeling companies are seeing an increase in business -- one firm recently did work for a customer who'd bought a foreclosure and needed to fix it up, for instance.

All this makes me wonder how many people would be knee-deep in home-improvement projects if this wasn't a down housing market and rough economy. Hmm ... sounds like a poll:

If you're eying a home-improvement project purely because you want to sell soon, keep in mind that your return on investment will probably be negative. At least that's what real estate agents have found since the bubble popped. The 2007 "cost vs. value" report by Remodeling magazine, which collected construction-cost estimates and surveyed appraisers, agents and brokers about resales, concluded that projects producing the most value for money were mostly exterior:

Of projects that saw national cost recovery rates of more than 80 percent in 2007, only one — a minor kitchen remodel, with 83 percent of cost recovered — was a strictly interior job. The others were an upscale siding replacement using fiber cement materials (88.1 percent), a wood deck addition (85.4 percent), midrange vinyl siding replacement (83.2 percent), and upscale vinyl and midrange wood window replacements (81 percent and 81.2 percent, respectively).

On the other hand, if your home is really outdated -- or in screaming need of maintenance -- then you're eliminating a lot of potential buyers if you put it on the market without working on it first. Decisions, decisions.

Buyers: If you could wave a magic wand and fix one thing about most of the homes you've seen, what would it be?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (9)

October 25, 2009

Real estate poll results: The time (of year) to buy


Photograph of Massachusetts scene from Library of Congress collection, via Flickr


Home sales drop as the weather turns cold, but does that mean people actively dislike buying in the winter?

I asked you in the most recent Wonk poll, and some of you said yes. But -- take heart, ye would-be sellers contemplating the arrival of the slow season -- not the majority.

The most popular answer, with 39 percent of the vote, was "time of year doesn't matter to me" when it comes to buying or selling a home.

Twenty-two percent of you opted for "anytime except winter." On the other hand, seven percent prefer winter over any other season for buying or selling.

Seventeen percent prefer spring.

Ten percent prefer summer.

And five percent prefer fall.

As MrRational noted in a comment on the poll:

For those who have options... the most common of considerations are schools (at least having a contract before the school year begins) balanced against weather; to not have to do the actual move during snow and ice and cold.

Working backwards from that... snoop, show and negotiate in the spring when every property will look it's best then settle and move at the end of June and be all tucked into place by August before you go to the beach.

JB commented, "Since I don't have school age kids school doesn't matter but I wouldn't move in November or December because of the holidays. Of the 2 houses that I bought I have moved in March & June."

Joseph Eamon Cummins, author of Not One Dollar More!, suggests in an online piece that winter is a good time to buy a home precisely because buyers aren't out in force. In winter's "withered leaves, patchy and lifeless grass, damp and grubby pathways, and few, if any, flowers," he sees the potential for better bargains:

In a nutshell, winter buyers recognize that negatives are often positives in disguise. And dreariness and darkness and wetness and clutter and other such enthusiasm killers can function excellently as the bases for making low offers. Then, negotiating strongly for a big price reduction.

Were you one of the few "I prefer winter" folks? What do you like about it as a time to buy or sell?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (4)
Categories: Polls

October 24, 2009

First-time home buyer tax credit: news roundup

Three things about the first-time home buyer tax credit:

1. Despite the credit's name, you don't actually have to be a first-time buyer to get it, merely someone who hasn't owned a home in three years. But you are supposed to -- you know -- actually buy a home.

The Treasury Inspector General for Tax Administration says more than 19,000 people have claimed the credit despite not purchasing anything. Just over 70,000 claimed it though they apparently didn't meet the definition of a first-time buyer. And 582 individuals under 18 claimed it, including some 4-year-olds. (I can just picture the parents: "What? He's a first-time buyer, isn't he?")

The agency says it "recommended that the IRS require taxpayers to provide documentation to verify a home purchase, such as a U.S. Department of Housing and Urban Development Settlement Statement (HUD-1) issued to homebuyers at closing," but the IRS said "nah." (OK, not exactly "nah," but that's the general idea.)

2. The Government Accountability Office issued a report that -- among other things -- breaks out the tax-credit usage by state as of Aug. 22. Maryland ranks 34th, with about 24,000 taxpayers claiming $166 million in credits. Report here, in PDF form. (Thanks to Jay Hancock for noticing this.)

Total nationwide: 1.4 million taxpayers claiming nearly $10 billion. Both the current version of the credit and the less-generous 2008 credit are included in the tally.

3. If you haven't already signed a contract on a home, you're going to be hard-pressed to get the credit -- assuming it expires Nov. 30 as planned. To close by that date, "you basically would have to sign a contract to buy a house today to qualify," Lawrence Yun, chief economist for the National Association of Realtors, told the Los Angeles Times ... yesterday.

Several local real estate agents, noting that most first-time buyers use slower-to-close FHA-insured loans, have told me they recommend allowing 45 to 60 days.

UPDATE: Looking for news about the Senate proposal on first-time and repeat-buyer tax credits? Go here.

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (41)
Categories: First-time buyer tax credit

October 23, 2009

Hidden-gem neighborhoods: It's a date

Months ago, I asked you to nominate Baltimore-area neighborhoods that are hidden gems -- nice, affordable places that aren't already on everybody's radar. You inundated me with suggestions.

You'll finally get to see the results Nov. 13, part of a Sun blogger campaign called 10Spot. First up -- today, in fact -- is Peter Hermann with the most notorious local crimes.

I thought a list of 10 neighborhoods would be a nice little side project. Little did I know how much time it would take to research, select, visit and compile. Boy, am I glad I'm almost done, as is everyone sitting near enough to me to hear my muttered complaints.

But it's been a great way to see parts of the region I've never or seldom spent time in. And I hope the exercise will introduce you to interesting neighborhoods you might know nothing about.

You'll get a chance to guess the 10 -- with clues and prizes! -- in two weeks.

Posted by Jamie Smith Hopkins at 8:42 AM | | Comments (0)
Categories: 10Spot, Hidden-gem neighborhoods

Survey results: Recommending where you live, or not

I recently put several questions to you that were part of a survey of Baltimore residents -- bottom-line sorts of queries about whether you like your neighborhood and jurisdiction enough to recommend it to others. Almost 70 of you weighed in. Mostly city residents, as it happens -- so much for comparing and contrasting across the region!

Eight Baltimore County residents took part, which I decided is just enough to make a comparison not completely ridiculous. (Hey, a scientific survey this isn't.) Here are the results for the city and county:

How likely are you to ...

Recommend living in your neighborhood to friends?

Among city residents, 84 percent said "likely" or "very likely." Sixty-three percent of county residents said the same; the remainder opted for "not likely" or "not at all likely."

Recommend living in your jurisdiction to friends?

Among city residents, 76 percent said "likely" or "very likely." Seventy-five percent of county residents said the same. 

Recommend buying a home in your jurisdiction?

Among city residents, 76 percent said "likely" or "very likely." Seventy-five percent of county residents said the same. 

Recommend your jurisdiction as a place to raise children?

Among city residents, 42 percent said "likely" or "very likely." Seventy-five percent of county residents said the same.  

Recommend your jurisdiction as a place to retire?

Among city residents, 51 percent said "likely" or "very likely." Fifty percent of county residents said the same.   

Move out of your jurisdiction in the next 1 to 3 years?

Among city residents, 47 percent said "likely" or "very likely." Thirty-eight percent of county residents said the same.   

So: Survey-takers living in the city are more likely to recommend living in their neighborhoods specifically than in the city generally. A majority offer a recommendatory thumbs up to buying a home in the city and (just barely) to the city as a place to retire, and a thumbs down to the city as a place to raise kids (though not overwhelmingly). And the majority don't plan to move out of the city in the next few years, though quite a few do.

Survey-takers in the county are -- in contrast to city folks -- more likely to recommend their jurisdiction as a place to live than their particular neighborhoods. They're split on whether to recommend the county as a place to retire but do recommend it as a place to raise kids. Most would recommend buying a county home, and most don't plan to move out in the next few years.

How do you like your neighborhood and jurisdiction? More importantly, what do (or don't) you like?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (1)
Categories: Survey says ...

October 22, 2009

$4 billion for affordable + green homes

Enterprise Community Partners, the affordable-housing giant founded by Jim Rouse, wants to funnel $4 billion in the next five years to affordable housing that's also green. That's what it announced Wednesday, at the same time challenging builders to green up all affordable housing -- including the stuff that's already standing and would have to be renovated.

You can read more about the green affordable-housing initiative here. But once you've done that, I thought you might be interested in checking out what "green" can mean.

Enterprise has set its own criteria, which you can see here (in PDF form). It offers points for some construction choices -- up five for flooring that's neither carpet nor vinyl, 12 for picking a site near public transit, 14 for using materials with recycled content, etc.

But a number of actions are simply required. Low volatile-organic-compound versions of paints, primers, sealants and adhesives. Power-vented fans or range hoods in the kitchen that exhaust directly outdoors, for better indoor air quality. Energy Star appliances.

Enterprise says it has found that its rules add about $4,500 in extra costs per unit, but save $4,850 in utility costs alone over the useful life of the home. Hard to put a price on healthier indoor air, but the nonprofit group says it makes a significant difference for asthma sufferers.

Enterprise's criteria is hardly the only "build green" list out there. Best known is probably the U.S. Green Building Council's LEED for Homes, which Enterprise kept in mind when it redesigned its requirements last year. The National Association of Home Builders has its own green-home criteria, too.

Is there anything green about your home? Any green options you'd like (or not like)?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (4)
Categories: Green building

October 21, 2009

Analysis: Expect 11 percent drop in home prices

Here's another analysis to make home sellers groan and first-time buyers cheer: financial analysis firm Fiserv expects prices will fall just over 11 percent -- here and nationally -- in the 12 months ending next June.

If its forecast for an 11.4 percent decline in median home prices in the Baltimore metro area proves accurate, local homeowners are facing a slightly bigger one-year decline than they've already weathered. Prices fell just under 11 percent from June '08 to June '09.

So what about the housing-market bottom we've all heard so much about for, oh, the last few years? Fiserv sees Baltimore-area prices stabilizing after the middle of 2010. In June 2011, it forecasts, prices will be up almost 1 percent from a year earlier.

For the U.S. as a whole, the company expects a price bump-up of 3.6 percent.

There are a lot of housing-market question marks right now that make forecasting tricky.

Will the $8,000 first-time buyer tax credit expire Nov. 30 as planned? Get extended? Get expanded to all buyers? What about the job market -- will companies stop laying off anytime soon? And are foreclosure rates going to improve soon or just get worse?

So: What's your forecast?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (17)
Categories: Housing forecasts

October 20, 2009

What to do about nightmare neighbors?

Recently, some of you offered advice to fellow Wonk reader Mr. Baltimore about his neighbor dilemma. He likes his next-door neighbor and doesn't want to damage the relationship, but he's getting tired of frequent renovation noise.

Here's a bigger problem for your collective smarts, posed by "no name":

My mom's neighbors are the craziest folk you'd never want to meet. They've robbed her home, left dog feces on her front door knob, shot at the cameras outside her home, shot at the guy installing for the second time the cameras outside her home, they use her outside water spicot and have caused her paveway to rot, they park their cars in her drive, they've threatened her life and have falsely accused her of things she hasn't done.

While in court, they lied while under oath and made her look as if she were some old, crazed woman in need of psychiatric care. If it were me, I know i would have committed suicide a while ago. I don't know how she puts up with it. They've even repeatedly slit her tires and had their children dump trash into her back porch and then, call the sanitation department on her. She's called the police. She's hired a lawyer, but still these insane neighbors seem to be winning.

Where's the justice?

Any suggestions? What can a law-abiding person do, short of move?

Posted by Jamie Smith Hopkins at 8:00 AM | | Comments (5)
Categories: Neighborhood and neighbors

The cost of selling a home in today's market

The housing-market slump means sellers are agreeing to cover some or all of buyers' closing costs. A big savings for buyers -- and a big expense for sellers.

Doris Hall-Scheeler, senior vice president at Sage Title Group in Baltimore, sees sellers contributing up to 6 percent of the sales price to buyers in closing-cost assistance. That's $18,000 on a $300,000 house. And it's just part of what homeowners have been paying to move on.

Add taxes and real estate commissions, and sellers can end up forgoing more than 12 percent of their sales price, Hall-Scheeler said.

That's frustrating for folks who were counting on that money to help buy a new home. But it's especially rough for sellers whose home values haven't increased more than 12 percent since they bought.

A lot of people are in that boat: Practically half of the Baltimore-area homeowners who bought during this decade and sold in the first half of 2009.

That's what I found when I re-crunched sales data from the state Department of Assessments and Taxation this week. (You've seen the first bite already -- that more than a third of those homeowners sold for less than their purchase price.)

As I mentioned in that story, it's roughest for homeowners who bought in 2006. Sales peaked in 2005, but prices were still rising the following year. Of '06 buyers who sold in the first half of this year, nine in 10 didn't end up with enough appreciation to get past the 12 percent mark. (Most saw values fall, not increase.)

Hall-Scheeler, the title company official, said she's not seeing many sellers bringing a check to settlement in cases where the home value can't cover their selling costs. But short sales -- in which lenders forgive the difference between the mortgage balance and the sales price -- are "big."

"It's a huge percentage of what we're doing," she said.

Posted by Jamie Smith Hopkins at 7:09 AM | | Comments (1)
Categories: Closing costs

October 19, 2009

Negotiating your rent

Over at the Consuming Interests blog, Liz Kay is offering useful advice to renters who want to negotiate a lower monthly payment. And some words of caution, too -- for instance, keep in mind before you issue ultimatums that switching apartments costs money.

If you missed it, you can read here about how a Baltimore County resident negotiated her rent increase down from $100 a month to $25 a month.

Posted by Jamie Smith Hopkins at 11:31 AM | | Comments (0)
Categories: Landlording, Renting

Where home prices aren't falling

If you're getting tired of hearing about home prices falling, here's a break from that: states where prices are up. A bit, at least.

North Dakota prices were 2.8 percent higher in the spring than they were a year earlier, according to the most recent figures from the Federal Housing Finance Agency. Prices rose fractionally in three other states: Oklahoma, South Dakota and Maine.

This is according to the FHFA's index tracking same-home sales over time.

Maryland prices, by contrast, fell just under 8 percent over the same period. (Thus endeth the break.) Nevada, the state with the fastest-falling prices, registered a 28 percent drop.

At this point, you might be thinking: North Dakota?! But it makes sense.

That state's unemployment rate is best in the nation -- a low 4.3 percent at a time when U.S. joblessness is flirting with 10 percent. And its home-price increase during the housing-frenzy days wasn't nearly as tremendous as in Maryland, Nevada and many other states.

In spring 2005, when year-over-year prices increased more than 20 percent in Maryland and Nevada, North Dakota's gain was a comparatively sedate 7.7 percent.

I wonder if North Dakota residents are feeling smug right now.

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (0)
Categories: Housing stats

October 18, 2009

New real estate poll: Seasonal considerations

Now is the winter of our discontent

Made glorious summer by this son of York;

And all the clouds that low'r'd upon our house

In the deep bosom of the ocean buried. -- William Shakespeake, Richard III

The devious Richard means the family of York, not a literal house. But he happens to be right about the real estate market: Winter is pretty discontenting for sellers. As the weather worsens and holidays loom, most people are thinking about food and gifts, not home inspections and settlements.

Take last year, for example. Some 2,600 contracts were signed in the Baltimore metro area in April of '08. In November? Fewer than 1,500. And just 1,328 in December.

But there were contracts signed, so people do buy and sell in every season -- happily or not.

Weigh in: Do you have a seasonal preference?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (2)
Categories: Polls

October 17, 2009

How do you like your neighborhood?

Baltimore surveyed residents to see what they think about safety, taxes, cleanliness and the like in their neighborhoods and the city overall. Annie Linskey wrote a story about the "sometimes-contradictory" results:

Baltimore is a dirty city with few good jobs. But it's also a green city whose residents love their neighborhoods, public parks and libraries. Their biggest worry is crime, but they consider their own blocks quite safe.

One part of the survey asked for bottom-line reactions: How likely are you to recommend living in your neighborhood to friends, recommend living in Baltimore, recommend buying a home there? Would you recommend the city as a place to raise children or to retire? And how likely are you to move out of the city in the next one to three years?

Good questions. I'm interested in how you would answer them about your neighborhood and jurisdiction, whether you live in the city or somewhere else. So: survey time!

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (8)
Categories: Survey says ...

October 16, 2009

Average rents: down

Here's some good news if you're a renter -- and bad news if you're a landlord: Average rents in the Baltimore metro area were 3.6 percent less this summer than they were a year earlier.

That's according to a new report from real estate research firm Delta Associates, which said the average was just under $1,400, or $1.35 per square foot. (These figures are for so-called "Class A" apartments -- nicer places.)

The declines ranged depending on location:

Effective rents in the southern suburbs dropped 2.4% from third quarter 2008 and the northern suburbs fell 3.7% from last year at this time. Effective rent growth in the Baltimore City submarkets was negative over the year, falling 6.1% in both the Fells Point/Inner Harbor and Downtown submarkets.

Another report -- this one from rental listing site -- focused on property owners and managers. In a survey, more than 70 percent said they're seeing more vacancies. Most blamed job loss as a factor, while half "said that tenants moved out because they were trying to save money on rent, or could no longer afford it at all."

One money-saving tactic at work: more "'doubling-up' with roommates."

So what are landlords doing in response?

Many property owners are lowering rents (69 percent), providing one or more months rent-free (65 percent) and reducing the amount of required deposits (35 percent). In addition to adjusting prices, property owners are drawing renters by offering upgrades to the rental unit (16 percent), allowing tenants leniency for breaking leases early (14 percent), offering storage or parking at reduced rates (10 percent) and relaxing pet policies (6 percent).

What are you seeing (if you're a renter) or doing (if you're a landlord)?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (4)
Categories: Landlording, Renting

October 15, 2009

How not to sell a house

It might seem self-evident at any time, let alone four years into a housing downturn. But real estate agent Daniel V. Iampieri, director of career development with Weichert, Realtors - Caton Properties in Ellicott City, says he sees evidence that sellers still need to be reminded that a too-high asking price isn't going to do any good.

If your pricing philosophy is, "hey, somebody could pay that," he thinks you ought to reconsider.

"Anybody could do anything, but properties need to be priced at what somebody would pay for them," Iampieri. "I think we're starting to get there, but you still see a lot of properties [that] as an agent and as a buyer, you skip over. If your property isn't being shown, your price is too high."

Iampieri isn't letting agents off the hook on this issue: "We need to do a better job of getting these properties listed at the right price," he said. "Why tell somebody the house is worth $500 and then have them tell you it's worth $550 and say, 'OK, I'll just list it for that.' Who is that helping?"

Or this, for that matter: "I've heard silly things in this market. People aren't getting showings and they say, 'Maybe we need to raise the price. Maybe we're in the wrong price range.'"

"I generally as a rule of thumb would equate activity on your home with pricing. The more activity, the better your price," he said. The addendum to this rule: "The price can't be right if everybody keeps looking at it and not buying it."

Do you have a pricing story to share?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (6)
Categories: Housing market experiences

October 14, 2009

Comment of the day

Wonk reader Josh, a mortgage broker, had this to say about the Federal Reserve's effort to keep rates low by buying mortgages and mortgage-backed securities:
There are 3 options:

1. Pull the Fed rate subsidy and housing prices WILL fall further, the only question is exactly how high rates will go and exactly how low prices will fall.

2. Keep the Fed rate subsidy program going indefinitely. The price of housing measured in dollars will be higher, but measured in anything else, gold, gallons of gas, gallons of milk, or loaves of bread, it will be lower.

3. Pursue real pro-growth policy that leads to higher wages and allow those higher wages to drive up prices.

One thing the prior decade showed us is that asset appreciation brought about by financial engineering is unsustainable. The supports being offered now are merely financial engineering, be it on a much larger scale than Wall Street.

See his full comment here.

Do you agree that those are the only options? What do you want the Fed to do (or not do)?

Posted by Jamie Smith Hopkins at 3:29 PM | | Comments (5)
Categories: Comment of the day, Mortgage rates, Mortgages

A parade of homes the Brothers Grimm could get behind

So you've always secretly wanted to participate in a parade of homes, but your place is more House Ugly than House Beautiful. No problem. The Historic Annapolis Foundation has just the event for you.

It's the group's 2009 Gingerbread Parade of Homes, which is just what it sounds like: Make a gingerbread house, enter it and possibly win. The foundation -- partnering with Long & Foster Real Estate in Eastport -- has categories for children, families, adults employed in either the food or architectural design industries and adults who aren't pros. Deadline to register: Nov. 16.

The results will be on display at Annapolis businesses in December.

Posted by Jamie Smith Hopkins at 8:00 AM | | Comments (0)
Categories: Housing humor

Waiting for equilibrium

Ken Wenhold, director of the Mid-Atlantic region for Metrostudy, a housing-industry information provider, has some thoughts about -- well, the Mid-Atlantic region. Specifically the trend he sees developing in Loudoun and Prince William counties in Northern Virginia. Listings down, prices rising.

He said in a press release that he thinks this wave is creeping north:

As long as year-over-year totals continue to increase in Maryland, we should see that market continue to improve, first in the D.C. suburbs, and then in the Baltimore region. Assuming things continue as projected, the spring of 2010 should see price stability in Maryland and another wave of buyers entering the market.

More specifically, he said: "While we do not expect the Baltimore region to improve as quickly as the Maryland side of Washington, D.C., it should continue to slowly tighten during the next 12 months, perhaps with the core counties reaching equilibrium in mid- to late 2010.”

Equilibrium in a housing-market sense means buyers and sellers in basically equal numbers.

Do you agree with Wenhold's forecast?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (9)
Categories: Housing forecasts

October 13, 2009

A first-time buyer tax credit Q&A

The Consuming Interests blog has been sending readers' questions about the $8,000 first-time buyer tax credit to the IRS for answers. There's a new question and answer there today: Can someone eligible for the credit collect on it if his non-eligible daughter is also named on the title?

You'll find the answer here.

Posted by Jamie Smith Hopkins at 9:36 AM | | Comments (0)

For sale: fewer homes

About 10 percent fewer homes were for sale in the Baltimore metro area last month than a year earlier. So says real estate brokerage ZipRealty in a new analysis of data on the multiple-listing service.

That's the direction you want things going if you're rooting for a market where the number of homes and interested buyers are more or less equal.

Not-so-good news: Most of the metro areas ZipRealty tracked in September saw bigger drops.

The company looked at 26 large regions, from Austin to Washington, and said inventory decreased more than 10 percent in all but seven. The number of homes for sale is down by 33 percent -- a full third -- in D.C. And Los Angeles has less than half the inventory now that it did a year ago.

UPDATE: Several readers have suggested making it clear that we're talking about homes listed for sale, as opposed to homes that people would really like to sell but haven't listed or have actually pulled off the market. Seems to me it's not truly for sale if you're not telling anyone about it, but no question there's shadow inventory out there.

Another notable stat from ZipRealty's analysis: The average listing in the Baltimore metro area has had two price reductions. I couldn't find an online link to the inventory report, but the price information is here.

Posted by Jamie Smith Hopkins at 7:30 AM | | Comments (8)
Categories: Housing stats

A word to the wise

If you get an email making "a credit free loan offer" to you and all other "serious minded individuals," you might want to think twice about providing your information to get said "loan."

Just sayin'.

What sort of mortgage-related spam has ended up in your inbox?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (1)
Categories: Mortgages

October 12, 2009

Light Source: What d'you know?

This isn't housing-related, but I thought you might be interested regardless. The newest questions for Light Source, the Sun's share-your-experiences opportunity, just went online today.

I told you about Light Source last month. Here's the lowdown: Economic news coverage is better for everyone when journalists hear from regular folks affected by economic issues, not just economists and policy makers. Light Source is your chance to make mass communication a two-way street.

This month's topic: health care. (Seemed timely.)

The direct link to the Light Source main page is, if you'd like to spread the word, and I hope you will.

And now back to your regularly scheduled real estate blog.

Posted by Jamie Smith Hopkins at 5:23 PM | | Comments (0)
Categories: Light Source, Off topic, just because I can

Moving back in with family (and other reactions to a rough economy)

Housing costs are a big part of most people's budgets, so I'm curious to hear how the economy has affected your living quarters. Have you made any changes, whether in reaction to a job loss, cut in income or general uncertainty about where things are headed?

I've heard some folks say they're doubling up with friends in rented space. Some are staying with their parents post-college; others are moving back in. Some folks are downsizing ahead of schedule. And some are staying put when they'd rather move.

What about you?

Posted by Jamie Smith Hopkins at 1:27 PM | | Comments (9)
Categories: Housing market experiences, Renting

Short sales

By now you probably all know what a short sale is: a deal in which the lender allows a home to change hands for less than the balance on the mortgage, forgiving most or all of the difference.

For months, agents have said there are far more would-be short sales than closed deals. The lenders reject the offers, or they take so long to consider that buyers give up and move on. So I was curious to hear what Olivia Surge, who negotiates short sales on behalf of homeowners at the Law Offices of G. Russell Donaldson in Crofton, is seeing now.

Compared with 2007, when nine months could go by before lenders would even look at an offer, "things have gotten much, much better," she said. "But we're still slow and go."

Lenders are typically taking 30 to 90 days to acknowledge that they have an application for a short sale, she said. "They're so inundated," she said.

I talked to Surge for Sunday's story about the growing number of homeowners selling for less than their purchase prices. I only had space for a few of her observations in the article, but I've got all the space in the world here. And I think you'll be interested in hearing more of what she had to say about what works, who's eligible, whether lenders are forgiving all the debt and how frequently these deals are popping up.

"The key," Surge said, "is following up with the lender."

It might take a while before a lender acknowledges receipt, but once they're looking at an application, sellers need to be ready to supply all requested information speedily. "If we miss a phone call to them, they could close the file," Surge said. "The volume of people in trouble is so high that they just don't have time."

The good news, she said, is that lenders are generally more efficient about short sales than they used to be. They've got systems in place, even if they're still trying to figure out what works best.

Another change: Lenders are less likely now to ask sellers to cover some of the difference between mortgage balance and sales price, at least for homeowners letting go of their principal residence. "The past five, six months, that's been the norm on a primary residence -- they're forgiving the remaining debt," Surge said.

In cases where the short sale is on a vacation home or investment property, though, the lender generally wants the owner to bring some cash to the table.

Short sales aren't an option for everyone under water on their loans. They're supposed to be hardship deals. You lost your job and can't pay the mortgage, for instance. But lenders are considering other life circumstances, too, Surge said.

"If you're in the military and you've received orders, they're very willing to work with you," she said. As for non-military, "They're willing to work with people when you've been relocated because the option was, 'Be relocated or be unemployed.'"

Surge warns homeowners that short sales won't be good for their credit scores. And she recommends that they talk to an accountant about tax implications. The federal government is temporarily not taxing homeowners on principal-residence mortgage debt forgiven by lenders, but you wouldn't want to find out you're ineligible after it's too late to reverse course.

Surge is one of three people in her office working full-time on short sales, and they're always at maximum capacity -- about 120 cases combined.

"We are certainly in a market where short sales are pretty much the norm," she said.

So common that first-time buyers -- who wouldn't normally opt for complex deals -- are trying to snap them up.

"Right now a lot of agents and buyers are very, very upset because they're not sure [the] buyers are going to be able to close in time to take advantage of the first-time buyer credit," Surge added. "They're like, 'Is there anything you can do to hurry up the process?' We're like, 'Other than calling them every single day?' And that's what we do. Some of these cases, we've been able to turn around to get approval within 45 days. Some -- I have one sitting here that I've been working on since February." 

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (7)
Categories: Mortgages, The foreclosure mess

October 11, 2009

Real estate poll results: First-time buyer tax credit

Many of you are probably feeling frazzled. I say that because the top answer in last week's poll -- the one about your relationship to the $8,000 first-time home buyer tax credit -- is "trying to buy in time to get the credit; haven't signed a contract yet." That's how a quarter of you poll-takers describe your situation.

Yikes! Time's a-wasting. The deadline's Nov. 30, and real estate agents have warned that it can easily take more time than you have left to get from contract to closing if you're using an FHA-insured loan.

But that all goes out the window if the credit gets extended, which it might. (There's even talk about upping the amount or expanding it to all buyers.)

Here's what the rest of you poll-takers said:

Bought this year; have gotten or will get the credit. Booyah! (Twenty percent)

Trying to buy in time to get the credit; have a contract but haven't closed yet. (Nineteen percent)   

Purposely waiting until the credit expires before buying. (Thirteen percent)

Six percent of you aren't a buyer or seller, 5 percent say you bought this year but don't qualify for the credit, 4 percent are trying to sell and hoping the credit will help, another 4 percent are interested in buying but don't care about the credit, and 1 percent have sold or are selling to a first-time buyer.

Several others wrote in answers. For instance:

"Bought last year with the $7500 credit that has to be repaid. Wish I'd waited!" (The $8,000 credit doesn't have to be repaid unless you move out within three years.)

"Previously bought and would buy and sell if it wasn't first time buyers only!!!!"

"Want to buy with the credit but what's out there for sale is garbage!"

"Bid on shortsale 5 months ago..waiting on bank. Need to close Nov 30!"

Here are your opinions about what should happen to the credit:

Most popular answer: Extend it as is for six months to a year. Forty-six percent of you opted for that choice.

Twenty-three percent of you want to extend it, but increase the amount and/or the eligible buyers.

Twenty-two percent say the credit should expire after Nov. 30 as planned.

Five percent say extend it, but decrease the amount and/or the eligible buyers.

Four percent say the credit should become permanent.

Some of you commented on the twin-polls post to share where you're coming from. For instance, Sarah, who's waiting to close on a house, said the credit isn't a big motivator: "It's a nice bonus to be sure, but in the grand scheme of things isn't really that much money. Not worth trying to score a house within the time frame that you don't like or can't really afford or anything like that, at least from where we stand."

Jason, who just had a contract fall through, said: "Of greater concern to me than the tax credit is the possibility of FHA raising its minimum down-payment."

Chel is trying to get a home, but the credit is making that harder: "Because of the credit, everything we've been interested has been scooped up too fast -- and we're not going to play the bidding war game."

And real estate agent John K. thinks any consideration of the upsides and downsides of the credit ought to include its ripple impact: "After spending $150-200k on a home, and pumping 1-2% of that sale price into the economy via transfer/recordation taxes, you then are going to start to make it 'your own.' Most houses in that price range need some sort of work usually, and even if it's move-in ready, you still want to add your own touches in terms of painting, furniture, etc."

More thoughts?

Posted by Jamie Smith Hopkins at 1:16 PM | | Comments (3)
Categories: Polls

Selling your home at a loss

If there's one assumption about homeownership that was pretty universal before this decade, it's that you'll at least equal your purchase price when you sell. Now, though, many aren't managing that.

In the Baltimore metro area, more than a third of homes bought this decade and resold in the first half of this year went for less than the sellers originally paid for the property. That's not counting closing costs at either end, mind you.

I crunched data from the state Department of Assessments and Taxation to put together this analysis of resold homes. You can read the full story about selling at a loss here.

Want to see more statistics? Go here and here.

Did you sell a home for less or buy a home in this category? Share your tale.

Here's one couple's story:



Posted by Jamie Smith Hopkins at 8:40 AM | | Comments (2)
Categories: Housing market experiences, Housing stats

October 10, 2009

Asking prices down

If yesterday's post about September home sales just whetted your appetite, you can read more in today's story. Included: some of the debate about the $8,000 first-time buyer tax credit, and whether to extend/expand it. (Which reminds me: This week's twin polls about the tax credit close at noon, so vote now if you haven't already.)

One thing I couldn't fit into the story is the newest monthly data from real estate search engine Trulia about price reductions. Compared with other large cities, the percentage of would-be sellers who have reduced their asking prices is fifth-highest in Baltimore. Or we're part of a five-way tie for first, depending on how you look at it.

Memphis, Minneapolis, Portland, Indianapolis and Baltimore all have reduced prices on 36 percent of their listings, but I'm guessing that the (hidden) decimal places explain why Trulia ranked these cities first through fifth.

Lowest among the 50 largest cities: Fresno, Calif., where 14 percent of listings have been price-reduced.

The average reduction in Baltimore is 11 percent, Trulia says. And average sellers in Baltimore last month got 13 percent less than they asked for, according to MRIS, so -- ouch.

Or, if you're a buyer, woohoo.

It really does depend which side of the settlement table you're on, doesn't it?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (1)
Categories: Housing stats

October 9, 2009

Neighbor dilemma: Suggestions?

Wonk reader Mr. Baltimore (not to be confused with the prolific MrRational) has a dilemma about what -- if anything -- to do about rule-breaking behavior from a next-door neighbor he otherwise likes. Here's the situation:
I have been attached to a wonderful neighbor for 13 years. She is very nice. However, her and her husband have been renovating their house for five years. First a closet, then a kitchen, then the basement, and finally a bathroom. Sometimes they will stop for a month or two, but sure enough it starts back up and continues for months on end. They have never gotten a permit for any of the work, or perhaps they would know that they could only work until 7 pm at night, sometimes they hammer up until 10 pm. I have never said anything to them because it behooves me that they could honestly bang on their house for five years and not once think about the fact that they are attached on both sides. Plus we have a good relationship so I never wanted to rock the boat. But here we are, entering my sixth Ravens season and they have their saw in the back yard ready to cut some wood this weekend. What do you do? What do you say?

Recommendations, anyone? If you've been through something similar, what did you do?

Posted by Jamie Smith Hopkins at 9:55 PM | | Comments (7)
Categories: Neighborhood and neighbors

Quote of the day

"If good fences make good neighbors then a ten foot wall with razor wire and klieg lights... er no, I don't think that is what Frost had in mind." -- Wonk reader MrRational, on this post about neighborliness and lack thereof
Posted by Jamie Smith Hopkins at 1:11 PM | | Comments (0)
Categories: Comment of the day

Baltimore-area home sales up for 4th month

Home sales rose about 10 percent in the Baltimore metro area in September, compared with a year earlier. That's the fourth straight month of year-over-year gains. Industry players credit the credit -- the $8,000 one for first-time buyers -- and price drops, which make homes more affordable for more people.

Speaking of drops: Average prices fell 7 percent in the metro area vs. a year ago. That's the 16th straight month of declines. The average sale price was about $275,000, less than the average seller got in September 2005 but still more than the '04 average.

Pending deals -- contracts written last month -- jumped 32 percent year-over-year. Buyers hoping to get in by the Nov. 30 tax credit deadline, I presume?

Prices fell across the region, and sales rose everywhere except Baltimore. The city's number of home sales dropped 13 percent. (A few more local details in my quick home sales story here, or see the Metropolitan Regional Information Systems data here.)

What are you noticing out there, market watchers?

Posted by Jamie Smith Hopkins at 10:31 AM | | Comments (3)
Categories: Housing stats

Good neighbors, bad neighbors, no neighbors

We've probably all had bad neighbors at one point or another. Noisy, rude, messy, scary ... Wonk reader M, on a post about code enforcement, noted that a neighbor "puts his trash out on the street whenever he wants, no can, only a big trash bag," which brings the truly uninvited sort of neighbors -- rats.

Hopefully we've all had good neighbors, too. Friendly, helpful, fun. I sure miss the friendly, helpful and fun family who lived near us for years, sharing hellos, advice and baby items.

Then there's the absence of neighbors -- empty homes in between renters, up for sale or foreclosed. They can be perfectly fine or a malignant tumor on a street. Eighty percent of U.S. city mayors, managers and code enforcers said in a recent survey (sponsored by a municipal software company) that citizen complaints related to foreclosures have gone up in the last year. Top beefs: unkempt yards and property damage.

What kind of neighbors do you have?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (14)
Categories: Neighborhood and neighbors

October 8, 2009

Rocky road ahead for the housing market, firm warns

John Burns Real Estate Consulting, a California firm that analyzes the U.S. housing market, is not part of the chattering class that thinks the bottom is here or near. The company warns in its most recent newsletter that it sees a "massive supply of homes" coming down the pike via foreclosure.

More supply means more downward pressure on prices, the firm notes:

For a number of reasons, banks have not been aggressively taking title to homes and selling them, which has resulted in very few distressed sales in comparison to the actual level of distress in the market. This delay in REO sales, along with historically low mortgage rates and an $8,000 tax credit, has helped to stabilize the housing market - temporarily.

It is very clear that price stabilization is temporary unless something is done.

What sort of "massive supply" numbers are we talking about? Pretty, um, massive: One out of every 10 U.S. homeowners is behind on mortgage payments, John Burns Real Estate estimates. Not one in 10 homeowners with mortgages. One in 10 homeowners, period.

I keep hearing from local real estate agents that they're seeing foreclosed homes that haven't been put on the market yet by lenders. Is this true near you?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (7)
Categories: The foreclosure mess

October 7, 2009

Home prices ... up?

Home prices in the Baltimore metro area were among the weakest in the nation this summer, but there are some hopeful signs for frustrated sellers, according to a new report by a real estate data firm.

Prices rose a tenth of a percent in the metro area in the four months ending Sept. 25 vs. the previous three months, California-based Clear Capital said. That’s lower than all but two other major housing markets — Las Vegas and Tucson, Ariz.

But you'll notice that prices are up, not down. It’s the first break in price declines for the Baltimore area since the summer of 2007, the report said.

Kevin Marshall, president of Clear Capital, thinks earlier increases in other parts of the country had a psychological effect on Baltimore buyers.

"People get very scared in real estate that they’re going to miss the bottom," he said. "You have people making decisions based off, for lack of a better term, fear that they’re missing a really good deal."

Clear Capital draws its data from recorders’ and assessors’ offices, calculating price by comparing repeat sales of the same homes over the years. Why the odd "four months ending Sept. 25" vs. the previous three months? Because, Marshall said, the company wants to balance out the desire to include the most up-to-date numbers with the reality that the newest data is often incomplete. So it includes an extra month of sales.

Overall, the metro area has seen more modest price declines than the country as a whole, the report says: 21 percent here since the housing market peaked in 2006 vs. nearly 32 percent nationally.

But decreases have accelerated locally in the last year while moderating elsewhere. Prices fell more than 12 percent in the metro area compared with last summer, compared with just under 10 percent nationwide.

The metro area’s healthiest spot seems to be the 20723 ZIP code in Laurel, where prices fell less than 1 percent vs. a year ago. The report credits the community’s location between Baltimore and Washington.

Hardest-hit was Edgewood, ZIP code 21040 in Harford County. Prices fell almost 25 percent from a year ago, and 34 percent of its sales were homes that had been taken back by banks.

Just under 20 percent of sales in the Baltimore metro area were foreclosed homes, the report estimates. That’s lower than the national average of about 29 percent, reflecting a high level of foreclosures in some markets.

In Las Vegas, for instance, six in every 10 sales this summer were foreclosed homes.

Posted by Jamie Smith Hopkins at 1:00 AM | | Comments (10)
Categories: Housing stats, The foreclosure mess

October 6, 2009

Tenant negotiates a smaller rent increase

Shireen Gonzaga was not at all happy when she discovered -- at lease renewal time -- that the rent for her apartment just north of Baltimore was going up $100 a month. In 21 years in the neighborhood, she'd  never seen a rent increase of more than $25.

Renters, take note: She fought back with facts. And won a major concession.

Gonzaga went on and looked up the rates -- regular rates, not move-in specials -- for nice rentals near her. Here's what she pointed out to her apartment manager:

Somerset at Towson, she wrote, is advertising 1,170-square-feet apartments for $1,140 and 1,280-square-feet apartments for $1,170, plus it has a pool, playground and extra storage units. Versailles in Towson has 1,300-square-foot apartments for $1,312 to $1,556, plus a pool, fitness center and clubhouse.

She threw in a few more examples, and then noted that her complex has units under 1,000 square feet advertised at $1,250 to $1,375. Amenity: playground. Maybe.

"I've not seen a playground on the property," she noted in an email to the property manager.

Considering the competition, she wrote, "it's very hard to understand the market rate of $1375 for my apartment."

"Please let me know if my assessment of your market rates are incorrect, and if so, please explain to me how you arrived at the $1375 value," she added in her note. "Otherwise, I hope you will rethink the way you determine market values, and offer more realistic rental rates to your tenants (assuming you want to keep them)."

Result: The property manager offered her a 12-month lease at $25 more a month rather than $100 more.

Recounting this to me, Gonzaga said: "I wonder how many other tenants are aware that the so-called market rate is grossly inflated?"

Odds are, some renters are getting good deals and some aren't. It doesn't hurt to research -- like Gonzaga did -- to see if you have room to open negotiations.

"This experience has been quite an eye-opener for me," she said.

Posted by Jamie Smith Hopkins at 7:11 AM | | Comments (9)
Categories: Renting

October 5, 2009

Baltimore in the news

The New York Times travel section shone a spotlight on Baltimore yesterday, suggesting destinations in town for a weekend trip. For instance, the "wooded, stream-filled oasis" that is the Jones Falls Trail, and the "strangest" of offbeat theater options at the Creative Alliance at the Patterson.

Where would you suggest out-of-towners go if they want to see Baltimore? (Or Annapolis or anywhere else in the region?)

Thanks to Mike B. for noticing the "36 Hours in Baltimore" piece.

Posted by Jamie Smith Hopkins at 1:33 PM | | Comments (2)

The first-time buyer tax credit and you

The $8,000 tax credit for first-time buyers (or more precisely, people who haven't owned a home in three years and meet the income limitations -- try saying THAT five times fast) is due to expire the end of next month. I'm curious how many of you are doing some serious house-hunting to try to beat the deadline, and how many of you have been affected one way or another by the credit so far.

The numbers suggest an impact. Buyers in the Baltimore metro area signed 19 percent fewer contracts in February than a year earlier. The drop in March -- the first full month after the program was altered so the money doesn't have to be paid back -- was a much more modest 4 percent. Signed contracts began rising in April.

In August, the most recent numbers from Metropolitan Regional Information Systems, the number of new contracts was up 25 percent from a year earlier.

So it certainly looks like there's buying going on that wouldn't have happened this year if not for the thought of $8,000 in the bank. But who knows -- it could be a huge coincidence. Help sort it out by noting how (if at all) the credit has affected you:

But wait -- there's more! Weigh in on the future of the credit:

Sun columnist Jay Hancock has already weighed in. Let the credit expire, he says. A number of folks (including some Wonk regulars -- hi guys!) commented on his blog post, some passionately for extension and some very much against.

Here's part of what Jelena had to say:

I think it's not going to be pleasant either way. End the credit and most likely the prices will dip more. Don't end the credit and our national debt will grow even further.

IMHO there are much more efficient and easier ways to help first time home buyers instead of just giving away money.

1) Any credits should be given to TRUE first-time buyers, not some people who haven't owned a home in a couple of years.

2) Instead of a give-away, provide a loan to help with the closing costs. Or, better yet, states and institutions should lower the fees associated with the home sale. Doesn't everyone find them outrageous? "Title examination fee"?

3) Do away with PMI, "front foot assessment" and other rip-offs.


Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (7)
Categories: First-time buyer tax credit, Polls

October 4, 2009

The right-sized house for you



I asked you recently what sort of house sounds ideal to you, size-wise. I didn't ask what you could afford, mind you -- just what you'd like. Even so, most of you opted for something far short of palatial.

Forty-six percent of you said in last week's poll that 2,000 to 2,999 square feet sounds just right. (Here's an example of a house in that size range.)

And 38 percent say just right is smaller -- 1,000 to 1,999 square feet.

Eight percent chose 3,000 to 3,999 square feet. Four percent went for the biggest option -- 5,000 square feet or more. Two percent selected 4,000 to 4,999 square feet

The very smallest option -- under 1,000 square feet -- got the smallest number of votes. But two of you did raise your hands for this sort of home.

One voter who goes by gardener commented that "as a single person I don't need much 'stuff' and would like to minimize maintenance time and effort. I'd rather spend the time outdoors."

Wonk reader Lisa also weighed in:

OK, so let's put it in terms of space use instead of square feet. My kids will be out of the house in a very few years... even then, I believe in 3-4 bedrooms -- i.e. our bedroom, a guest room, and a study, or even small his/hers studies -- (my husband gave his den up to our son a while back and has never really adapted to the loss of "personal" space). Then, I prefer a kitchen nook for breakfast, if possible, and separate living/dining rooms, but that can depend on the layout. The older Baltimore homes often haven't got a finished basement (as recroom), but guess what? Without one, Baltimoreans ACTUALLY USE their elegant living and dining rooms. All this can happen in approx 1800-2200 sq feet and be exceedingly comfortable.

How much space do you have, and does it work for your needs?

(Photo from the Library of Congress via Flickr)

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (6)
Categories: Polls

October 3, 2009

Uncle Sam offers relocating military personnel some aid

There's nothing like having to relocate during a housing slump to give you heartburn if you're a homeowner, especially if you bought just a few years ago. But if you're in the military, you might be due some help.

The Department of Defense -- which employs a lot of people who have to move around every few years -- has $555 million earmarked to reimburse personnel for some of the difference between their purchase and selling price. That includes BRAC folks, the people moving to Maryland (and elsewhere in the country) for the national base realignment and closure process.

While the initiative "is not designed to pay 100 percent of losses or to cover all declines in value, it can help protect eligible applicants from financial catastrophe due to significant losses in their home values," the DOD said.

Here's how the agency is prioritizing the money, which comes from the February stimulus package:

1. Homeowners wounded, injured, or ill in the line of duty while deployed since Sept. 11, 2001, and relocating in furtherance of medical treatment;

2. Surviving spouse homeowners relocating within two years after the death of their spouse;

3. Homeowners affected by the 2005 BRAC round, without the need (which existed under previous law) to prove that a base closure announcement caused a local housing market decline; and

4. Service member homeowners receiving orders dated on or after Feb. 1, 2006, through Dec. 31, 2009, for a permanent change of station (PCS) move. The orders must specify a report-no-later-than date on or before Feb. 28, 2010, to a new duty station or home port outside a 50-mile radius of the service member’s former duty station. These dates may be extended to Sept. 30, 2012, based on availability of funds.

More details about the expanded Homeowners Assistance Program here. Might this apply to you?

And for non-military folks: Have any of you received help from your employer for a relocation?

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (3)
Categories: BRAC, Relocating

October 2, 2009


We hit 3,000 comments recently. Now the Real Estate Wonk blog has crossed over the 1,000-post mark. Can I get a w00t?

It happened this week, with this post about the effect of the financial crisis on affordable housing. That represents two years of blogging. Daily, for the most part. (Neither rain, nor sleet, nor gloom of night ...) Here's the first post -- an introduction -- from Sept. 25, 2007, in case you're curious.

Thank you for reading, suggesting topics and joining in on the conversation here. I'm always happy to hear from you.

Posted by Jamie Smith Hopkins at 8:59 PM | | Comments (1)

The cost of a four-bedroom house -- across the country

Home prices vary a lot across Maryland, and that's just one state. Compare the whole country, and the swings are enormous.

That's what Coldwell Banker Real Estate did recently -- compare prices across the country for a "move-up" house: single-family with four bedrooms, 2.5 bathrooms and about 2,200 square feet of space total, "in neighborhoods/zip codes within a market that is typical for corporate middle-management transferees."

The company, which crunched numbers for 310 housing markets in the country, said the average was just under $364,000.

The average in Baltimore, Coldwell Banker said, was about $381,000. It didn't specify whether it meant just the city, but I'm guessing so because it also included Towson on the list (at just under $382,000).

Towson and Baltimore were 83rd and 84th, respectively. No. 1: La Jolla, Calif., with an average move-up price of $2.1 million. Least pricey was Grayling, Mich., where you can have that 2,200-square-foot house for under $113,000. (Michigan has the country's highest unemployment rate, so make sure you can find a job there before you go rushing west for a cheap home.)

Eleven markets in Maryland were included. The most expensive was Bethesda, ranked 25th at almost $760,000. Annapolis was 33rd at about $687,000. Least expensive of the Maryland markets: Hagerstown, No. 179 on the list at about $238,000.

Do those prices match up with your sense of what it takes to get a nice four-bedroom? 

More than a quarter of the markets in the Coldwell Banker analysis had average prices under $200,000, from Dubuque, Iowa to Rochester, N.Y. to Myrtle Beach, S.C.

You can compare and contrast markets with this search tool. Or you can see the full list as part of this story.
Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (3)
Categories: Cost of living

October 1, 2009

Housewarming gifts -- what's useful?

Hey, folks, I'm interested in hearing what you think are good housewarming presents. What's useful or fun? What isn't? Would you rather have something that will last forever and remind you of the giver, or something -- like a bottle of wine -- that you can use up on the spot?

And do you have a go-to gift when you're giving rather than receiving?

I still display the hand-painted "Hopkins household, established 1998" wall hanging that a neighbor gave me, so that was a good one in my book.

Posted by Jamie Smith Hopkins at 4:11 PM | | Comments (13)

Lego house -- emphasis on the "house"

Your opportunity to buy a house made of Legos -- and by that, I mean an actual house-sized house -- has sadly gone by the wayside. Workers were pulling the British structure apart last month because, like a number of homes made of more conventional materials, this one was buyer-less.

According to the Telegraph, "Plans for Legoland to move it to their theme park fell through because transport costs were too high and despite a final Facebook appeal for someone to take it, no-one came forward."

Number of Lego bricks: 3.3 million.

It was built for James May’s Toy Stories, a BBC series. If the house followed the original plan, its interior sported a Lego shower and toilet.

Geekologie noted the teardown on a post tagged with these pointed categories: "You fools!" and "You should have donated it to Geekologie!"

Posted by Jamie Smith Hopkins at 7:00 AM | | Comments (2)
Categories: Housing humor, Unusual homes
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About Jamie Smith Hopkins
Jamie Smith Hopkins, a Baltimore Sun reporter since 1999, writes about the regional economy. Her reporting on the housing market has won national and local awards. Hopkins is a Columbia native and has lived in Maryland all her life, save for 10 months spent covering schools in Ames, Iowa.
She trained to become a wonk by spending large chunks of time as a geek and an insufferable know-it-all.
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