Facing a hot real estate market and growing base of do-it-yourself consumers, many REALTORS® are competing less with one another and more with consumers buying and selling on their own. Below are common questions that prospective clients often ask when considering this option and responses to consider.

1. Are more consumers trying to sell their homes on their own these days?

No, it just seems that way. When mortgage rates are low and the housing market is active, home sellers view the process as easy and become more likely to sell on their own. Conversely, when mortgage rates are high and the market cools, those same consumers turn to experienced REALTORS®. In any market, it's proven that home sellers represented by a REALTOR® achieve a 20 percent higher home value statewide than those sold by owners.

2. Why use a REALTOR® when just sticking a sign in the ground will attract multiple buyers?

In a hot market, can a sign attract buyers? Sure. However, unless your home is priced properly and you can successfully write a solid contract, you will leave money on the table or fail to sell your home. REALTORS® are intimately familiar with real estate law and the closing process. When you chose to work with an experienced professional, you are making a solid investment that is usually repaid with a higher sale price and lower legal liability.

3. REALTORS® are great for people who want to avoid the hassle, but I'm an educated, do-it-yourselfer. What harm is there in cutting out the middleman?

Most sellers who begin the process without representation by a REALTOR® end up by listing in the end, as evidenced by a recent National Association of REALTORS® survey that found only 11 percent of sellers actually sell on their own. Real estate transactions are fraught with potential liability and it's easy for consumers to stumble into legal trouble. A seller that overlooks even one required form or legally mandated disclosure could face a lengthy and expensive buyer lawsuit after the transaction closes. Working with a REALTOR® ensures every part of the transaction is compliant with real estate law and can help you avoid the many pitfalls possible between the initial sales agreement and closing on the home.

4. What are the limitations involved in selling my own home?

• Valuation - Research shows that, on average, homes sold by their owners sell at prices 20 percent lower than homes sold by REALTORS®. Given that cost is a primary reason most consumers sell their own home, this statistic reveals they often take on that additional hassle and risk while actually decreasing their earnings.
• Inaccurate pricing - Like many homeowners, unrepresented sellers tend to believe their home is worth more than comparable homes in the same neighborhood. Unfortunately, this leads to their home staying on the market longer and eventually achieving a lower valuation anyway. REALTORS® have expertise in pricing homes for sale and will ensure your home is sold at the best price, quickly and with minimum hassle.
• Access to the MLS - By far the largest and most accurate source of information regarding properties for sale, the Multiple Listing Service (MLS) is the primary information source home buyers consult when represented by a REALTOR®. Thus, unrepresented sellers often are unable to reach this large group of prospective buyers.
• Intimidated buyers - Research shows that potential buyers spend less time in a home if the owner is present. They often feel uncomfortable discussing their opinions of the property if the owner is present and are less inclined to make an offer if they know they'll be negotiating directly with the seller. Thus, the pool of prospective buyers is limited further.

January 20, 2010 - According to the Multiple Listing Service report by the Austin Board of REALTORS®, the volume of Austin area home sales in December 2009 was 1,373, up five percent from the same month in 2008. The median price of real estate in the Austin area also showed an increase, up six percent from December 2008 to $194,000.

“We saw dramatic increases in sales volume in October and November 2009, which were presumably related to the original deadline for the first-time homebuyer tax credit,” explained John Horton, 2010 Chairman of the Austin Board of REALTORS®. “However, increases in sales volume beyond November and figures that have improved steadily throughout the year indicate that, while some demand was driven by the tax credit deadline, a sustainable recovery is also underway in the real estate market.”

Year-end real estate totals for 2009 showed improvement in sales volume and stability in home prices over the course of the year. In 2009, 19,005 homes were sold in the Austin area, a six percent decrease from 2008. The median price for the region in 2009 was $188,480, down one percent from 2008. The six percent decline in year-end home sales for Central Texas marks a significant improvement when compared to the double-digit decreases in home sales seen in the first quarter of 2009.

Mr. Horton summarized, “We’re seeing encouraging news from many sources that 2010 will be an improvement over 2009, and I think this report is one more indicator the outlook is beginning to brighten. As always, however, I urge consumers to base their decisions about buying and selling real estate on their own situation and goals. Talk to your Austin REALTOR® for advice on whether 2010 should be your year to buy a home or move up.”

December 2009 Statistics

■$358,863,756 – Total dollar volume of single-family properties sold, an 11 percent increase from December 2008.

■$194,000 – Median price for single-family homes, a six percent increase from December 2008.

■1,373 – Single-family homes sold, a five percent increase from December 2008.

■8,079 – Active single-family home listings on the market, a five percent decrease from December 2008.


2009 Year-End Totals
■$4,612,315,236 – Total dollar volume of single-family properties sold, a nine percent decrease from 2008.

■$188,480 – Median price for single-family homes, a one percent decrease from 2008.

■19,005 – Single-family homes sold, a six percent decrease from 2008.

■9,335 – Active single-family home listings on the market, a five percent decrease from 2008.

December 21, 2009 - According to the Multiple Listing Service report by the Austin Board of REALTORS®, the volume of Austin-area home sales continues to surge, increasing 58 percent in November 2009 compared to November 2008.

“This is the largest increase in year-over-year homes sales the Austin market has seen in more than ten years,” explained Jay Gohil, chairman of the Austin Board of REALTORS®.

In November 2009, there were a total of 1,576 home sales, contributing $377,603,296 to the local economy. The median home price for Austin in November 2009 was $179,000, a two percent decrease from the same month the prior year.

“The combination of steady home prices with increasing demand is very encouraging for the Central Texas real estate market,” said Gohil.

In the face of increasing sales volume, the Austin real estate market is seeing a decrease in home inventory. The Real Estate Center at Texas A&M University cites 6.5 months of inventory as a balanced market, meaning demand for homes is evenly balanced with inventory of homes for sale. At approximately 5.4 months of inventory for November 2009, demand for homes in the Austin real estate market is slightly outpacing inventory.

November 2009 Statistics

* $377,603,296 – Total dollar volume of single-family properties sold, a 62 percent increase from November 2008.
* $179,000 – Median price for single-family homes, a two percent decrease from November 2008.
* 1,576 – Single-family homes sold, a 58 percent increase from November 2008.

November 18, 2009 - According to the Multiple Listing Service report by the Austin Board of REALTORS®, the volume of home sales in the Austin-area real estate market surged in October 2009, potentially related to the tax credit for first-time homebuyers.

In October 2009, 1,823 homes were sold, a 38 percent increase from 1,322 in October 2008. The median price of Austin homes in October 2009 was $182,000, a five percent decrease from the same month the prior year.

In the early part of this year, home sales volume in Austin was down significantly compared to 2008. However, that gap in sales volume began to close in July 2009 when the local market reached a volume similar to the same month in the year prior.

“Sales volume like this is similar to what we saw in 2005, which is an encouraging sign,” said Jay Gohil, chairman of the Austin Board of REALTORS®. “It’s possible some of this surge in volume was related to the original deadline for the first-time homebuyer tax credit, so it’s good for our market that the tax credit was both extended until April and expanded to include more current and prospective homeowners.”

October 2009 Statistics
* $434,975,092 - Total dollar volume of single-family homes sold, a 35 percent increase from one year ago.
* $182,000 - Median price for single-family homes, a five percent decrease from October 2008.
* 1,823 – Single-family homes sold, up 38 percent from the same time last year.


The Austin Board of REALTORS® is a non-profit, voluntary organization representing more than 8,000 licensed REALTORS® in Central Texas.

Though home sales also were up in September, by 6 percent compared to the same month last year, the Austin Board of Realtors said that the region hasn’t had an increase as big as October’s since March 2005, when sales also rose 38 percent.

The board reported that 1,823 homes were sold compared with 1,322 in October 2008. The median price was $182,000, down 5 percent from the previous October.

The tax credit that has been spurring sales locally and nationally was set to expire Nov. 30, but recently was extended through April 30 and a provision was added for a credit of up to $6,500 for qualified move-up and repeat home buyers.

“Sales volume like this is similar to what we saw in 2005, which is an encouraging sign,” said Jay Gohil, chairman of the Austin Board of Realtors. “It’s possible some of this surge in volume was related to the original (Nov. 30) deadline for the first-time homebuyer tax credit, so it’s good for our market that the tax credit was both extended until April and expanded to include more current and prospective homeowners.”

The number of homes listed for sale, 8,947, was down 10 percent from a year ago. And pending sales were up 47 percent, with 1,811 contracts in the pipeline to close.

From January through October, area home sales were down 11 percent, and the median price was down 1 percent, to $189,000, the board reported.

Article by Shonda Novak
Austin American Statesman
Wednesday, November 18, 2009, 03:38 PM

Area home sales jump, fueled by tax credit
By Shonda Novak
AMERICAN-STATESMAN STAFF
Wednesday, October 21, 2009

Existing home sales in Central Texas rose 6.4 percent in September, the first year-over-year increase in more than two years, and the median sales price also was up, rising 2 percent to $185,250, the Austin Board of Realtors reported Tuesday.

Sales were buoyed by factors including a federal tax credit of up to $8,000 for eligible first-time homebuyers and mortgage interest rates that are hovering around 5 percent.

The 1,780 sales last month were up from 1,748 in August and up from 1,673 in September 2008. The number of sales due to close in October was up 24 percent from a year ago, an indication that the tax credit is continuing to spur sales, real estate agents and experts say.

With pending sales up and prices stabilizing, it seems "to indicate a market that is beginning to recover," said Charles Heimsath, an Austin real estate consultant, although he predicts "a slow ascent into recovery over the next 12 to 18 months."

Heimsath and other experts have cautioned that the housing market, locally and nationally, could lose steam if the tax credit is not renewed, although there are proposals in Congress to extend or broaden it.

"Still, it does appear the worst of the housing downturn is behind us, although it may be some time before we see a marked turn upward," said D'Ann Petersen, an economist with the Federal Reserve Bank of Dallas, adding that she expects "a slow, prolonged recovery."

Nearly half the sales in September were for homes costing between $100,000 and $199,999 — a typical price range for a first-time home.

Nick Teplitz moved to Austin from Los Angeles in late May, drawn by the city's reputation as a "hip, fun city" and lower housing costs than in California.

He said the tax credit was a factor in his purchase of a unit at 2020 Congress, an apartment building that was converted to condominiums on South Congress Avenue.

Teplitz, a writer, closed on his condo June 30, paying under $100,000 for a one-bedroom unit.

Instead of "flushing $2,000 a month down the toilet" on rent in Los Angeles, Teplitz, 32, found he could own his home in Austin for one-third that much.

He said he thinks the tax credit should be extended, because it's "definitely going to keep the market afloat right now ... and keep people buying."

Jay Gohil, chairman of the real estate board, said the tax credit is likely to feed sales into November as buyers scramble to make the deadline.

The credit was passed earlier this year as part of the federal stimulus package. It provides a 10 percent credit, up to $8,000, for first-time buyers and those who have not owned a home in the previous three years. It is available to single buyers who make less than $75,000 a year and couples who make $150,000 or less.

Through September, the 14,286 home sales were down 14 percent from the same nine months of 2008, and the median price was unchanged, at $190,000.

But home sales have been slowly improving this year along with the economy, spurred by the tax credit and low mortgage rates.

Nell Hanson, a real estate agent with JB Goodwin Co., said the company "has had a huge influx of buyers who want to use the tax credit." Although an extension of the credit would be beneficial, "the low interest rates and the potential rise in the median price in Austin for 2010 will keep sales going up," Hanson said.

Greg Cooper, CEO of Goldwasser Real Estate in Austin, said "it would be suicide for the (housing) market" if the tax credit isn't renewed.

"I can't see them (Congress) taking it away right now," Cooper said, at least not until job growth comes back and unemployment eases.

Cooper said sales at his firm were up 51 percent in September over a year earlier, and "if we close what we have pending," October's sales will be triple that of last October's.

"Obviously, the stimulus is clearly helping," Cooper said.

Steve Cochrane, managing director at Moody's Economy.com, an economic forecasting and consulting firm, said he thinks that there is "a better than even chance" the credit will be renewed. He noted that there are positive ripple effects, as owners sell their entry-level homes to first-time buyers and are able to move to another home.

Asked whether the credit is artificially propping up the market, Cochrane said: "One can argue that any kind of government stimulus is artificial. But if it acts as the spark to get the market going, that can be fine. The government doesn't have to stay in the business of providing the spark forever."

snovak@statesman.com; 445-3856

Find this article at:
http://www.statesman.com/business/content/business/stories/realestate/2009/10/21/1021homesales.html?cxntlid=inform_sr

Both companies have been placed in a government conservatorship under the newly created Federal Housing Finance Agency (FHFA). The CEO's of both companies will step down and Fannie Mae and Freddie Mac will both be under the day to day direction of FHFA Director Jim Lockhart for the time being. The goal is to stabilize the companies having a positive effect on our country's fincial system and preserving their ability to provide or guarantee mortgages for American home buyers.

Interest rates dropped 1/4 of a point today and are expected to decrease a full point if the takeover is a success.

The government will take approximately 80% ownership of the firms through the issuance of senior preferred stock and warrants. This stake in the companies would provide a return to taxpayers in the future depending on the success of the companies. Common stock holders are expected to lose much of their investments, similar to a bankruptcy filing. Already low shares of the two companies took a hit Monday when the market opened. Other financial stocks have recorded gains on the news in the US and abroad.

Rural Housing Direct Loans are loans that are directly funded by the Government. These loans are available for low- and very low-income households to obtain homeownership. Applicants may obtain 100% financing to purchase an existing dwelling, purchase a site and construct a dwelling, or purchase newly constructed dwellings located in rural areas. Mortgage payments are based on the household's adjusted income. These loans are commonly referred to as Section 502 Direct Loans.

Purpose: Section 502 loans are primarily used to help low-income individuals or households purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities.

Eligibility: Applicants for direct loans from HCFP must have very low or low incomes. Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI. Click here to review area income limits for this program. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance, which are typically within 22 to 26 percent of an applicant's income. However, payment subsidy is available to applicants to enhance repayment ability. Applicants must be unable to obtain credit elsewhere, yet have reasonable credit histories. .

Terms: Loans are for up to 33 years (38 for those with incomes below 60 percent of AMI and who cannot afford 33-year terms). The term is 30 years for manufactured homes. The promissory note interest rate is set by HCFP based on the Government’s cost of money. However, that interest rate is modified by payment assistance subsidy.

Standards: Under the Section 502 program, housing must be modest in size, design, and cost. Modest housing is property that is considered modest for the area, does not have market value in excess of the applicable area loan limit, and does not have certain prohibited features. Houses constructed, purchased, or rehabilitated must meet the voluntary national model building code adopted by the state and HCFP thermal and site standards. Manufactured housing must be permanently installed and meet the HUD Manufactured Housing Construction and Safety Standards and HCFP thermal and site standards.

Approval: Rural Development officials should make a decision within 30 days of the Rural Development office's receipt of the application.

For more information check out the USDA Income and Property Eligibility Site: http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?Home