Adding Value by Dennis O'Hagan

The Vote Is In: Americans Place High Value on Homeownership...

RISMEDIA, Saturday, January 14, 2012— By an overwhelming margin, American voters strongly value homeownership and would oppose efforts to weaken or eliminate the mortgage interest deduction or diminish a federal role to help qualified home buyers obtain affordable 30-year mortgages, according to a new nationwide survey gauging likely voters’ attitudes towards homeownership and housing policy issues.

“The American electorate is sending a clear message that owning a home remains a cornerstone of the American Dream and preserving a federal commitment to homeownership is essential to maintain a thriving middle class and get housing and the economy back on track,” says Neil Newhouse, a partner and co-founder of Public Opinion Strategies.

Conducted on Jan. 2-5 on behalf of the National Association of Home Builders by the Republican and Democratic polling firms of Public Opinion Strategies in Alexandria, Va., and Lake Research Partners in Washington, D.C., the comprehensive survey of 1,500 likely voters includes data from key political “swing areas,” including National Journal political analyst Charlie Cook’s swing House and Senate seats and Stuart Rothenberg’s presidential swing states. The survey, which has a margin of error of ±2.5 percent, is a follow-up to a similar national poll conducted last May.

The poll shows that three out of four voters—both owners and renters—believe it is appropriate and reasonable for the federal government to provide tax incentives to promote homeownership. This sentiment cuts across regional and party lines, with 84 percent of Democrats, 71 percent of Republicans and 71 percent of Independents agreeing with this statement.

Also, two-thirds of respondents say that the federal government should help home buyers to afford a long-term or 30-year, fixed-rate mortgage.

Moreover, 73 percent of voters oppose eliminating the mortgage interest deduction. These figures held firm across the political spectrum, with 77 percent of Republicans, 71 percent of Democrats and 71 percent of Independents against doing away with the mortgage interest deduction.

Meanwhile, 68 percent would be less likely to vote for a congressional candidate who proposed to abolish the deduction, a figure that was virtually identical across all party affiliations (69 percent of Independents and 68 percent of Democrats and Republicans).

A majority of voters are also against proposals to reduce the mortgage interest deduction, eliminate the deduction for interest paid for a second home, limit the deduction for those earning more than $250,000 per year, scale back the deduction for home owners with mortgages above $500,000 and do away with the deduction for interest paid on home equity loans.

“With the 2012 election season in full swing, candidates running for the White House and Congress would be wise to heed the will of the American voters, who have expressed broad support for government policies that encourage homeownership and oppose efforts to make it more difficult to get a home loan and to tamper with the mortgage interest deduction,” says Celinda Lake, president of Lake Research Partners.

Among the poll’s other key findings:

• 96 percent of homeowners are happy with their decision to own and 84 percent who are “underwater,” or owe more on their mortgages than their home is worth, expressed the same sentiment.
• 79 percent of home owners would advise a family member or close friend just starting out to buy a home, and 69 percent of those who are underwater on their mortgage would offer the same advice.
• 74 percent said that despite the ups and downs in the housing market, owning a home is the best long-term investment they can make.
• Homeownership and a retirement savings program are considered by voters to be their best long-term investments.
• 78 percent of respondents said that owning their own home is very important to them.
• Nearly seven out of 10 voters who are not currently home owners (68 percent) said it was a goal of theirs to buy a home.
• Job uncertainty and saving for a downpayment and closing costs are the biggest barriers to buying a home.

The survey findings are consistent with the results of other public opinion surveys. In a New York Times/CBS News poll conducted in June, 89 percent said that homeownership is an important part of the American Dream and more than 90 percent indicated that it is important for the federal government to continue the mortgage interest deduction.

According to a Pew Research Study conducted last March, 81 percent of respondents agree that buying a home is the best long-term investment a person can make and 81 percent of renters surveyed said they would like to buy a house.

“Even in a down housing market, homeownership remains a core American value, with the vast majority of citizens who do not currently own a home saying they want to buy a home,” said Bob Nielsen, president of the National Association of Home Builders and a home builder from Reno, Nev. “Those running for office in November need to understand that voters will not look kindly on any candidates who seek to dismantle the nation’s long-term commitment to homeownership.”

For more information, visit www.nahb.org/homeownershippoll.

10 IMPORTANT FACTS ABOUT THE EXTENDED HOMEBUYER CREDIT

Below is the latest information related to the Extended Homebuyer Credit Program.   It is very time-sensitive in order to receive funds available to you if you close on a home prior to June 30, 2010. 
Please take a look and if you or anyone you may know could benefit from this opportunity, please give me or Cheryl a call or email us at Cheryl@CherylOHagan.com or Dennis@DennisOHagan.com to get started!

  
10 IMPORTANT FACTS ABOUT THE EXTENDED HOMEBUYER CREDIT


IRS Special Edition Tax Tip 2009-13

If you are in the market for a new home, you may still be able to claim the First-time Homebuyer Credit.  Congress recently passed The Worker, Homeownership and Business Assistance Act of 2009, extending the First-Time Homebuyer Credit and expanding who qualified.

Here are the top 10 things the IRS wants you to know about the expanded credit and the qualifications you must meet in order to qualify for it.

1. You must buy - or enter into a binding contract to buy a principal residence - on or before 
April 30, 2010.

2. If you enter into a binding contract by April 30, 2010 you must close on the home on or before
June 30, 2010.

3. For qualifying purchases in 2010, you will have the option of claiming the credit on either
your 2009 or 2010 return.

4. A long-time resident of the same home can now qualify for a reduced credit.  You can qualify 
for the credit if you've lived in the same principal residence for any five-consecutive year 
period during the eight-year period that ended on the date the new home is purchased 
and the settlement date is after November 6, 2009.

5. The maximum credit for long-time residents is $6,500.  However, married individuals 
filing separately are limited to $3,250.

6. People with higher incomes can now qualify for the credit.  The new law raises the income 
limits for homes purchased after November 6, 2009.  The full credit is available to taxpayers 
with modified adjusted gross incomes up to $125,000, or $225,000 for joint filers.

7. The IRS will issue a December 2009 revision of Form 5405 to claim this credit.  The December
2009 form must be used for homes purchased after November 6, 2009 - whether the credit
is claimed for 2008 or 2009 - and for all home purchases that are claimed on 2009 returns.

8. No credit is available if the purchase price of the home exceeds $800,000.

9. The purchaser must be at least 18 years old on the date of purchase.  For a married couple,
only one spouse must meet this age requirement.

10. A dependent is not eligible to claim the credit.

For more information about the expanded Home Buyer Credit, visit IRS.gov/recover.

To get started on your home search now, call or email me with your home needs, and we can get started on finding your next home now!



I look forward to hearing from you!

Housing Prices, Interest Rates & Tax Credits: NOW Is The Time To BUY!!!

If you have been thinking about buying a house now is the time to get off the fence...  Historic records show that home prices don't drop when rates rise. The trend is quite the opposite...

Every quarter-point change in interest rates is equivalent to approximately $6,000 for each $100,000 borrowed over the course of a 30-year fixed-rate mortgage. So, if you have decided to put down $40,000 and borrow $200,000 to help pay the typical nationwide home price, but you wait until mortgage rates rise one full point, you will end up paying an additional $48,000 over the course of your loan. Borrow $500,000, as some people on either coast do, and you are out an extra $120,000.

If you are thinking of buying, trading up or down, and you have a good job and good credit, act now.

I found that housing prices did not fall in the years when interest rates were rising. In fact, housing prices generally rose when interest rates climbed. When reviewing the numbers adjusted for inflation, housing prices still rose when interest rates made their steepest climbs and even fell when interest rates retracted. The most obvious examples were the years from 1975 through 1983.

Housing prices have dropped an enormous amount and have seemingly stabilized. Interest rates are as low as any of us have ever seen them and likely are as low as any of us will see in our remaining lifetimes. Housing inventories are above historical averages, thus selection is high, but I want to point out that inventory has started to decline.

Even those in the business of buying and selling foreclosed properties will tell you that while foreclosures are still coming, the selection is waning and the opportunities are becoming less attractive. Finally, with the soon-to-expire tax credits, the government is paying you to buy a house. People continue to complain that it's not fair that the federal government is bailing out the banks and not helping the average Joe. Well, that's just not true. Low interest rates and tax credits help the average Joe.

If you are employed with a good job, have decent credit, believe that home ownership is still a fundamental precept of the American dream, and either don't own a home or don't own the home you want, now is the time to take your head out of the sand and start doing your home work. If you don't, you will look back at having missed the opportunity of a lifetime.

Give me a call or email me at Dennis@DennisOHagan.com and I will be happy to help you find a great place...

Census Bureau statistics show that fewer Americans are uprooting. And when they do move, they're favoring D.C., Alaska and Texas.

U.S. residents are leaving two sunny states in droves and heading to unexpected places...

Don't mess with Texas

In terms of net migration -- those moving in minus those leaving -- Texas was the star performer in 2008, with the population growing by 140,000.

That meshes with what moving company Allied Van Lines experienced. "We moved more people here than anywhere in the U.S. in the last several years," said David King, general manager of Berger Transfer and Storage in Houston, Texas, and Allied Van Lines' largest booking and hauling agent.

The moving company recorded 5,891 inbound shipments and 3,988 outbound shipments in 2008, a net gain of 1,903. That was just slightly lower than last year's net gain of 2,041.

That influx may be due to the state's employment picture, which has remained rosier than most other places thanks to the energy industry and a welcoming business climate. Plus, home prices never cycled through a boom-bust period: They've remained affordable, which facilitates mobility.

In contrast, battered Michigan, with its housing and job woes, was the least-popular place to move to. The state experienced a net loss of 109,000 people, or 1.1%, in 2008, according to the Census. Allied said its outbound shipments totaled 2,388, more than double its inbound shipments of 1,181.

New York State lost even more people than Michigan -- 126,000 people -- but because it has a larger population to begin with, the percentage drop is just 0.7%, almost identical to New Jersey's.

To read the entire article please click <HERE>...

Record Low Interest Rates Entice Homebuyers

You don’t have to be an expert in economics to know that as interest rates drop, mortgage applications rise. Add the lowest mortgage rates in recorded history, and lenders are working double time to meet the demand.

Freddie Mac Interim CEO John Koskinen predicts that mortgage rates, which are holding in the mid to upper 4 percent range, are “probably as good as it’s going to get” and “interest rates are probably close to bottoming out.” The government sponsored mortgage investment company is recommending that people buy now.

While much of the current loan activity centers around refinancing, the low rates also are attracting homebuyers into the market. Many of those include first-time buyers who are also enticed by the new $8,000 tax credit.

Record-low mortgage rates, great pricing and the new tax credit have combined to push consumer buying power through the roof but how long it will last is anyone’s guess.

Simply put, the lower the mortgage interest rate, the more home a buyer can afford to purchase. For example, a monthly payment on a $250,000 mortgage would be roughly $1,200, assuming a 5 percent down payment and a 30-year loan at 4.5 percent. However, if the interest rate goes up to 6.25 (which it was in November 2008) that same $1,200 mortgage payment would apply to a home valued at just $205,000—a $45,000 reduction in buying power.

In deciding how much home you can afford, experts recommend that first-time homebuyers, and even seasoned homeowners, follow some practical “old school” advice.

Most mortgage counselors or financial advisors suggest using the 28/36 rule. This basically means that your monthly housing expenses like the mortgage, insurance and property taxes should be no more than 28 percent of your gross monthly income. And, all your debt combined should account for no more than 36 percent of your gross income.

Depending on your circumstances, there may be some flexibility in easing the 28/36 rule, like including a co-signer on the mortgage or making a large down payment.

If you or anyone you know is interested in buying a home please give either Cheryl or me a call or send us an email at Cheryl@CherylOHagan.com or Dennis@DennisOHagan.com and we will be happy to help.

Investment Properties

Investment properties are also known as Non Owner Occupied.  Here are some defining rules as it relates to Investment Properties:

• Property can be rented
• Family member sometimes occupy the property
• Is not eligible for the homestead exemption
• Must do a Conventional loan with at least 20% down
• Must have strong cash reserves remaining after loan closes
• Must count full payment and cannot offset with a new lease
• Rate is higher than owner occupied
• Seller contribution ia maximum of 2% of sales price

This information was provided to me by Fay Hendon of Service First Mortgage.  Service First Mortgage is located at 175 Ridge Road, Ste. 600 in McKinney, TX  75070,  You can call her at 972-562-0096 or email her at Fay.Hendon@servicefirstmtg.com.

Dallas is the best market for Real Estate investing

HomeVestors of America Inc., a company that trains local franchisees to buy homes and repair them, named Dallas the top real estate market for investing in the third quarter.

Dallas-based HomeVestors of America is known primarily by its marketing slogan, “We Buy Ugly Houses.”

In the company’s listing of top real estate investing markets, Dallas is followed by Houston and Fort Worth, which rank second and third, respectively.

HomeVestors purchased more than 36,000 homes in the U.S. last year. Data collected in their housing markets contributed to the report and determined the cities rankings.

HomeVestors says with tighter lending conditions and a shaky economy hurting homeowners, franchisees are seeing more homeowners who are determined to accept cash to off load their properties.

Other markets ranked in the top 10 locations for real estate investing include: Atlanta (No. 4); San Antonio (No. 5); Denver (No. 6); St. Louis (No. 7); Philadelphia (No. 8); Milwaukee (No. 9); and Richmond (No. 10).

Investing in Real Estate

As with all investments, real estate investment has it own risks and the decision to invest should be carefully considered. As a landlord there are certain costs that you will need to cover, potential vacancy problems that may strain your ability to pay your mortgages, and liability issues. It is important that you speak with an expert before putting yourself in a situation where you can potential over-extend yourself.

Single-family residence. First time real estate investors are usually advised to buy a single family detached home and rent it out as it's market value appreciates. The reason for the popularity is that they are relatively easy. They are easy to buy, easy to finance, and they hold appeal to buyers and renters.

Vacation property and second homes. Investment options in this category are myriad, from outright purchase to fractional-interest contracts and timeshares. Even if the property isn't income producing, it can appreciate into a worthy investment, and mortgage interest is fully deductible.

Apartment properties. Apartment properties require a long-term commitment, as well as a substantial investment of borrowed and equity capital, but due to the availability of professional managers they often don't demand a lot of personal time. If you are the do-it yourself type then you might find yourself spending your weekends painting, advertising vacancies, and repairing faucets - though the higher return might be worth it for you.

Condominiums. Condominium investments provide a bit of extra risk. Their market value appreciates more slowly than for detached single-family residences, and rental rates usually aren't high enough to cover mortgage, property tax, and maintenance fees.

Commercial property. To reduce personal liability and offset the greater expense of these properties, some investors form or join a limited liability company. Because of the extremely high risks involved with this type of agreement, consulting a real estate attorney is essential before taking this step.