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At the metro area level, Dothan saw the largest percentage increase in residential permitting from 2011 to 2012.

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Mortgage buyer Freddie Mac says the rate on the 30-year loan dipped to 3.38% from 3.40% last week. It’s slightly above the 3.31% rate reached in November, lowest on records dating to 1971.

The average on the 15-year fixed mortgage was unchanged at 2.66%. The record low is 2.63%.

The rate on the 30-year fixed mortgage averaged 3.66% in 2012, the lowest annual average in 65 years, according to Freddie Mac.

Cheaper mortgages are a key reason the housing market began to come back last year. Many economists predict the housing recovery will strengthen in 2013.

If you are looking to buy or sell a home in Decatur or North Alabama, please give us a call!!!

The index showed prices up 4.3% in October compared to a year earlier. That’s the best improvement since May 2010. But that earlier increase was due to a temporary spike caused by a homebuyers’ tax credit of up to $8,000 on homes purchased in late 2009 and early 2010.

This latest rise comes as the housing market has shown numerous other signs of recovery in recent months. A combination of near record-low mortgage rates, lower unemployment and a drop in foreclosures to a five-year low means there are more buyers interested in purchasing fewer available homes. That in turn has lifted prices.

October marked the fifth straight month that the index has been up on a year-over-year basis.

The improvement in housing market fundamentals has helped to lift the pace of both home sales and home building.  But even with the latest rise in prices, the index is still down 29% from the peak reached in June 2006.

The continued rebound in prices likely will be another positive for both purchases and construction in the year ahead. Higher prices give current homeowners a better chance to sell their home and get the down payment they need on their next home purchase. They also encourage buyers who may have been on the sidelines because of uncertainty about home prices’ direction that now is the time to buy.

Of course, home builders benefit from higher prices and increased demand. Leading home builders such as PulteGroup , Lennar , KB Home , D.R. Horton, Inc.  and Toll Brothers  have all enjoyed better than a 50% rise in their stock price over the last 12 months, with PulteGroup’s stock nearly tripling in value.

The increases in home values were widespread in this latest reading, with only two of the 20 cities tracked by index showing modest price declines from a year earlier. Prices were down a little more than 1% in Chicago and New York.

The biggest rise was in Phoenix, one of the cities hardest hit when the housing bubble burst. Prices in Phoenix were 21.7% higher than in October 2011.                                                 

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The Mortgage Bankers Association forecasts that more and more house hunters will start coming off the sidelines, with new-home loans for purchases expected to jump 55%, based in dollars, in 2013.

With that increased competition, “the days of buyers sticking it to sellers are over,” says Salt Lake City real estate agent Tracie Peay.

Sellers: Don’t get too excited just yet. You don’t have a viselike grip on this market either. Indeed, for many, it still makes sense to wait to get better prices. This is especially true if you know that you won’t be able to break even on your investment by unloading your house now, once you factor in the sales commission and other costs.

That said, don’t assume that prices will be off to the races again in a year or two.

Fiserv forecasts that between now and 2017, homes will gain 3.3% a year in value. That’s hardly red-hot. But at least the market isn’t frozen anymore.

THE ACTION PLAN

Sellers

The price still has to be right

Homes in many markets are selling in a matter of weeks, often attracting multiple bids — but only the ones that are properly priced. Take San Francisco. Although the city is one of the strongest sellers’ markets right now, the average home there goes for 103% of list price, not 120%.

“Buyers aren’t going down the road that got so many people in trouble during the bubble,” says Dallas real estate agent Mary Beth Harrison.

Focus on the appraisal

Whoever bids on your home will probably finance the purchase. That means any deal is still beholden to a third party.

“You can take the highest offer, but at the end of the day the appraiser has the final say on the value of the home,” says David Howell, chief information officer at McEnearney Associates, a real estate agency in the D.C. metro area.

With so much riding on the appraisal — it can kill an agreement or require renegotiation — your agent should be present. Harrison has a tip for making sure this happens: “The minute we have an offer, we take the keys off the door to make sure the appraiser has to meet us to get in.”

Your agent should also prep a package of pertinent information for the appraiser, says Chicago real estate agent Fran Bailey. That includes the latest comparable sales data and documents detailing any upgrades or renovations to help the seller’s cause. “It’s part of my job to make sure the appraiser has the correct information,” she says.

Buyers

Be ready to deal

With competition heating up, casual house shopping isn’t going to cut it anymore. If you are serious about making a move, be prepared:

Three months out. Despite housing’s green shoots, getting a mortgage remains incredibly tough. The average FICO credit score for recently denied applications on conventional purchase loans was 729. The score on approved mortgages was 762, with a 21% down payment, monthly payments equal to 21% of household income, and total debt that did not exceed 33% of income.

On the bubble with any of those requirements? Now’s the time to burnish your finances. And if you plan to house hunt in the spring, watch your holiday spending.

Deal time. “If you want to buy, you have to be ready to make an offer,” says Howell. Plus, your first offer should be very close to your best. “If the house has been on the market for three months or longer, you can be more aggressive,” says Bailey. “But if it’s a new listing, a low-ball bid will get you ignored.”

The Money tracker: What can upset the forecast in the year ahead…

Ben runs out of ammo. Fed chairman Ben Bernanke is lifting housing by buying bonds to keep mortgage rates low. How much longer can he keep that going?

The loss of mortgage deductions. Should the tax break on mortgage interest get cut, that would throw cold water on the real estate recovery.

Sellers sit on the fence. Homeowners could remain on the sidelines as the ranks of buyers grow. In that case, the inventory of homes would shrink even more, lifting prices faster than expected.

Homeowners get bullish. A spate of home construction is already taking place in several major markets. In those regions, the housing stock is likely to stabilize, keeping price gains modest.

Banks loosen their grip. If tight lending standards return to historical norms, realtors argue, the market could see an additional 500,000 to 700,000 home sales next year.

Employer confidence rises. Since jobs are the engine of the housing market, a pickup in hiring later in the year, which economists are predicting, could accelerate a real estate rebound in the second half of 2013.

Supply: The statewide housing inventory in August was 33,510 units, a decrease of 7.3 percent from September 2011 and 16.4 percent below the month of September’s peak in 2010 (40,069 units).

There were 10.5 months of housing supply (6 months considered equilibrium) in September 2012 versus 10.8 months of supply in September 2011, a slower than desired decline of 3.3 percent.

September inventory in Alabama experienced a 1.0 percent decrease when compared to the prior month. This trend is consistent with historical data indicating that September inventory on average (’07-’11) traditionally decreases from the month of August by 1.1 percent.

Demand: In September, Alabama residential sales were outperformed by the US market which showed an increase of 11.0 percent from the prior year (September 2011), according to the National Association of REALTORS (NAR). NAR also reported that the South region sales were up 14.2 percent from last September. Investors accounted for 18 percent of nationwide sales while 28 percent were all-cash sales and 32 percent were first-time home buyers (40% in typical market).

September statewide residential sales decreased 17.7 percent from the prior month. This movement was consistent with historical data that indicates that September sales, on average (’07-’11), decrease from the month of August by 9.3 percent. In comparison, US sales slipped only 1.7 percent from last month while the South region dipped by .5 percent from the prior month (August 2012).

Pricing: The statewide median selling price in September was $125,601, an increase of 3.9 percent from last September. In contrast ,this figure represents a decrease of 1.4 percent when compared to the prior month. This is consistent with historical data (’07-’11) that reflects an September median selling price that traditionally decreases from the month of August by 1.7 percent. Nationally, NAR says that distressed homes – foreclosures and short sales sold at deep discounts – accounted for 24 percent of September sales (13 percent were foreclosures and 11 percent were short sales), Foreclosures typically sold for an average 21 percent below market price in September, while short sales were discounted 13 percent.

Local Results: 7 out of the 25 local reporting associations (28% – this is down from 60% in August) reflect sales gains from the prior year (September’11) while 18 associations (72% – down from 80% in August) reported YTD sales gains from 2011. Year-to-date, sales in metro markets (up 9% from last year) have outperformed both rural (up 5%) and midsize areas (up 1%). All 5 major metro areas representing 70% of Alabama sales have positive YTD year-over-year growth rates except Tuscaloosa (down .5): Huntsville (up 11%), Birmingham (up 12%), Mobile (up 4%) and Montgomery (up 13%).

As the market continues through year-end, statistical volatility is anticipated.  Real estate sales are seasonal and the sales pace begins to slow during the winter quarters. All that said, through September seventy-two percent (18 of 25) of the local housing markets have experienced year-to-date (ytd) sales growth from 2011 and that is welcome news for Alabama consumers as well our state’s real estate community. On the other hand, continued anemic US job creation/economic growth, strict underwriting standards, uncertainty of election (ie 2013 tax policy) and the global economic slowdown top the list of concerns that market watchers cite as elements that could possibly impact the gradual housing recovery.

Signs of recovery have been evident in the recent pick ups in home prices, home sales and construction. Foreclosures are also down and the Federal Reserve has acted to push mortgage rates near record lows.

But while many economists believe this emerging housing recovery will produce only slow and modest improvement in home prices, construction and jobs, others believe the rebound will be much stronger.

Barclays Capital put out a report recently forecasting that home prices, which fell by more than a third after the housing bubble burst in 2007, could be back to peak levels as soon as 2015.

“In our view, the housing market had undergone a dramatic over-correction during the prior five years, resulting in pent-up demand for housing purchases that would spark a rapid rise in housing starts,” said Stephen Kim, an analyst with Barclays, in a note to clients.

In addition to what Kim sees as a big rebound in building, he’s bullish on home prices, expecting rises of 5% to 7.5% a year.

Construction is expected to be even stronger, with numerous experts forecasting home construction to grow by at least 20% a year for each of the next two years. Some believe building could be back near the pre-bubble average of about 1.5 million new homes a year by 2016, about double the 750,000 homes expected this year.

“We think the recovery is for real this time around,” said Rick Palacios, senior analyst with John Burns Real Estate Consulting. “If you look across the U.S. economy right now, there are only a handful of industries looking at 20-30% growth over the next 4-5 years, and housing is one of those.”

The housing rebound can have a ripple effect that could help get the entire economy growing at a much stronger pace, which will add to more demand for housing.

Altman said he expects housing will add 4 million jobs to the economy over the next five years, as pent-up demand for home purchases drives building and and home prices higher.

If you are looking to buy or sell a home i9n Decatur or North Alabama, give us a call!!!

The S&P/Case Shiller composite index of 20 metropolitan areas gained 0.4 percent in July on a seasonally adjusted basis, shy of economists’ forecasts for 0.9 percent, according to a Reuters poll.

On a non-adjusted basis, prices fared better, rising 1.6 percent.

Six years after its collapse, economists believe the housing market has turned a corner. Recent data show home resales and groundbreaking on new properties rose in August, while business sentiment among homebuilders picked up to a more than six-year high this month.

The home price data confirmed “recent good news” about the sector, David Blitzer, chairman of the index committee at Standard & Poor’s, said in a statement.

“All in all, we are more optimistic about housing. Upbeat trends continue,” said Blitzer.

U.S. stock index futures held gains immediately after the data, while long-dated Treasury bond prices trimmed gains and the dollar extended losses slightly against the euro.

“This shows a continual recovery in the housing market, which continues to progress,” said Mike Gibbs, co-head of the equity advisory group at Raymond James in Memphis, Tennessee.

Compared to a year ago, prices in the 20 cities were up 1.2 percent, beating expectations for 1 percent. It was the second month in a row year-over-year prices have risen.

Four cities had prices that were lower than a year ago, with Atlanta faring the worst, down nearly 10 percent. Hard-hit Phoenix continued its rebound to gain 16.6 percent.

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Rising home values helped 1.3 million homeowners get out from “underwater” in the first half of the year, and another 2 million would get equity if national home prices increase by another 5 percent, data aggregator CoreLogic said today.

CoreLogic estimates that 22.3 percent of all residential properties with a mortgage were worth less than what was owed on their mortgages at the end of June, down from 23.7 percent at the end of March.

That translates into 10.8 million homeowners who owed more than their homes were worth at the end of June, down from 11.4 million at the end of March and 12.1 million at the end of 2011, CoreLogic said.

“Surging home prices this spring and summer, lower levels of inventory, and declining REO sale shares are all contributing to the nascent housing recovery and declining negative equity,” CoreLogic Chief Economist Mark Fleming said in a statement.

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Nevada had the highest percentage of mortgaged properties that were underwater (59 percent), followed by Florida (43 percent), Arizona (40 percent), Georgia (36 percent) and Michigan (33 percent).

Those five states accounted for 34.1 percent of the $689 billion of negative equity in the U.S.

Most of that negative equity is concentrated in the low end of the housing market, CoreLogic said. About 32 percent of homes worth less than $200,000 are underwater, compared with 17 percent of homes valued at more than $200,000.

Borrowers with second loans on their homes tend to be more deeply underwater. About 39 percent of underwater borrowers (4.2 million homes) had second loans, and the average loan balance among that group was $300,000 — about $84,000 more than their homes were worth, on average.

Among the 61 percent of underwater borrowers without second liens (10.2 million homes), the average mortgage balance was $216,000, about $51,000 more than their homes were worth on average