Shelly Ragan Blog

Housing Starts Stay Strong; Building Permits Rise.

2012-02-17T08:35:00.001-06:00

The housing market has carried forward its year-end momentum.

According to the Census Bureau, on a seasonally-adjusted, annualized basis, January's Single-Family Housing Starts crossed the half-million unit marker for the second straight month.

This hasn't happened in close to 2 years and is the latest in a series of strong data that suggests the beleaguered housing market has turned a corner -- both nationally and locally in Elkhorn.

Although single-family starts slipped 1 percent from December, January's annualized 508,000 figure represents a 16% spike from January 2011 and is the second-highest reading since April 2010 -- the last month of 2010's federal home buyer tax credit program.

A "housing start" is a new home on which construction has started.

The strength of January's Housing Starts data surprised Wall Street analysts and is partially responsible for Thursday's unexpected mortgage rate spike.

In hindsight, though, we should have seen this coming.

Earlier in the week, the National Association of Homebuilders announced that homebuilder confidence had climbed to its highest point since 2007 amid builder reports of rising sales volume and the most foot traffic from buyers in more than 4 years.

In addition, builders expect to sell more homes in 2012 than in 2011.

Builders are building and buyers are buying.

Meanwhile, as another sign of housing market strength, the Census Bureau reports that, in January, Building Permits moved to a multi-year high as well. Permits issued for single-family homes in January rose 1 percent from December, a statistic that suggests housing will continue its run through the spring season, at least.

86 percent of homes break ground within one month of permit issuance.

It's a good time to be a home buyer. Mortgage rates and home prices are low. Housing market momentum, however, is building. If you're on the fence about whether to buy a home , ask your real estate agent for additional market information.

The cost of home-ownership may never be as low as it is today.

Housing Starts Stay Strong; Building Permits Rise.

2012-02-17T08:23:00.001-06:00

The housing market has carried forward its year-end momentum.

According to the Census Bureau, on a seasonally-adjusted, annualized basis, January's Single-Family Housing Starts crossed the half-million unit marker for the second straight month.

This hasn't happened in close to 2 years and is the latest in a series of strong data that suggests the beleaguered housing market has turned a corner -- both nationally and locally in Elkhorn.

A "housing start" is a new home on which construction has started.

The strength of January's Housing Starts data surprised Wall Street analysts and is partially responsible for Thursday's unexpected mortgage rate spike.

In hindsight, though, we should have seen this coming.

In addition, builders expect to sell more homes in 2012 than in 2011.

Builders are building and buyers are buying.

86 percent of homes break ground within one month of permit issuance.

The cost of home-ownership may never be as low as it is today.

Homebuilder Confidence Returns To Pre-Recession Levels

2012-02-16T08:22:00.001-06:00

New construction buyers in Omaha , look out. The nation's home builders are predicting a strong 2012 for new home sales. It may mean higher home prices as the spring buying season approaches.

For the sixth straight month, the National Association of Homebuilders reports that homebuilder confidence is on the rise. The Housing Market Index climbed four points to 29 in February, the index's highest reading since May 2007.

The Housing Market Index is now up 8 points in 8 weeks. The last time that happened was June 2003, a month during which the U.S. economy was regaining its footing, much like this month. It's noteworthy that June 2003 marked the start of a 4-year bull run in the stock market that took equities up 54%.

The NAHB's Housing Market Index itself is actually a composite reading. It's the end-result of three separate surveys sent to home builders monthly.

The association's questions are basic :

How are market conditions for the sale of new homes today?
How are market conditions for the sale of new homes in 6 months?
How is prospective buyer foot traffic?

In February, builders reported marked improvement across all three areas. Builders report that current home sales climbed 5 points; that sales expectations for the next 6 months climbed 5 points; and that buyer foot traffic climbed 1 point.

Most notable of all of the statistics, though, is that the nation's home builders report that there are now twice as many buyers setting foot inside model units as compared to just 6 months ago.

This data is supported by the monthly New Home Sales report which shows rising sales and a shrinking new home inventory.

Because of this, today's new home buyers throughout Nebraska should expect fewer concessions from builders at the time of contract including fewer price breaks on a home and fewer free upgrades. Builders are optimistic for the future and, therefore, may be less willing to "make a deal".

This spring may mark the best time of year to buy a new home. 60 days forward, it may be too late.

With Retail Sales And Consumer Confidence Rising, Home Prices Are Expected To Follow

2012-02-15T08:30:00.001-06:00

The U.S. economy continues to show signs of a rebound.

According to the Census Bureau, Retail Sales climbed to $329 billion last month on a seasonally-adjusted basis, excluding automobiles. January's data marks the 18th time in 19 months that Retail Sales rose, a run that's increased total sales receipts by 11 percent.

This is big news because Retail Sales accounts for close to 70% of the U.S. economy.

In addition, consumer confidence is rising.

In a separate, joint report from the University of Michigan and Thompson Reuters, it was shown that consumer attitudes toward the economy and the future are improving, primarily the result of recent job gains.

The Survey of Consumers posted its highest value in 12 months.

It is not a coincidence that Retail Sales and consumer confidence both made multi-month highs -- the readings are more than loosely linked. As consumers feel more confident about the economy and their personal prospects for the future, they're more likely to spend money on goods and services, which leads to an increase in consumer spending.

For the housing market, the ramifications are two-fold.

First, from the financing side, an expanding economy is linked to rising mortgage rates. This is because Wall Street tends to chase risk in a growth economy and the bond market offers little in the way of risk. As demand for bonds drops, then, mortgage rates rise throughout Nebraska.

Second, rising consumer confidence can lead Papillion home values higher, too.

Confident consumers are more likely than fearful ones to become home buyers. They're more likely to stop renting and start buying; more likely to list their home and "move-up" to something bigger; more likely to "take the next step".

So, as more buyers enter the market at a time when the national home supply is shrinking, the supply-demand balance in housing is shifting toward the sellers. This creates price pressures and should lead to higher home valuations.

If you have plans to buy a home in 2012, the best time to buy may be now. Today's mortgage rates are low and so are the home prices -- a combination that's unlikely to last.

Fewer Jobless Claims Suggests Higher Home Prices Ahead

2012-02-14T08:25:00.001-06:00

Economists believe the strength of the 2012 housing market will be closely tied to jobs. If they're right, the housing market is ripe for a boost. It spells good news for Papillion home sellers and may mean the end of bargain-basement prices for buyers.

Since peaking in mid-2009, the number of U.S. workers filing for first-time unemployment benefits has dropped 44 percent. Over the same period of time, the U.S. economy has added more than 2 million jobs and the national Unemployment Rate is down more than 1 percentage point to 8.3%.

Employment's link to the housing market is both economic and psychological.

To make the economic link is straight-forward. A person with a job earns verifiable income and such income is required in order to be mortgage-eligible. For conventional and FHA purchase loans, for example, mortgage lenders want a home buyer's monthly income be more than double his monthly debts.

For the formerly unemployed that have since returned to work, having a full-time income makes buying homes possible. It also supports higher home valuations nationwide because home prices are based on supply-and-demand. All things equal, when the number of buyers in a market goes up, prices do, too.

The psychological connection between housing and employment is a tad more complicated, but every bit as important. It's not just out-of-work Americans that don't look for homes -- it's fearful Americans, too. People with concerns about losing a job are just as unlikely to shop for homes as people actually without a job. The same is true for people unsure of their prospects for a better-paying job, or their own upward mobility.

A recovering job market can lessen those fears and draw out buyers -- especially those who face a loss on the sale of an "underwater" home.

The Initial Jobless Claims rolling 4-week average is at its lowest level since 2008. Fewer Americans are losing jobs, and more are finding permanent placement.

It's one more reason to be optimistic for this year's housing market.

Top 10 Sunniest Cities In the United States

2012-02-13T07:50:00.001-06:00

As compared to gloomy days, do "sunny days" put you in a good mood? If you're like many people in Nebraska , the answer is "yes".

In a study of more than 1,200 people, researchers found that daily weather factors such as temperature, precipitation and length of day can alter a person's emotional state. Of all the weather factors, however, "sunshine" can have the most profound effect.

The most likely reason is because sunshine affects people in a physiological manner.

When the human brain detects sunlight, our bodies produce serotonin, a chemical which promotes happiness and well-being. By contrast, when the brain detect darkness, our bodies produce melatonin, a chemical which promotes sleep cycles.

Sunlight -- quite literally -- leads to happiness.

Understanding the effect of sunlight on human mood, therefore, we must consider the nation's "sunniest cities" as more than just a novelty list. It may be a link to personal well-being, too.

From the National Climactic Data Center, these are the Top 10 Sunniest Cities in the United States :

Yuma, AZ : Sunny on 90% of all days
Redding, CA : Sunny on 88% of all days
Las Vegas, NV : Sunny on 85% of all days
Phoenix, AZ : Sunny on 85% of all days
Tucson, AZ : Sunny on 85% of all days
El Paso, TX : Sunny on 84% of all days
Fresno, CA : Sunny on 79% of all days
Reno, NV : Sunny on 79% of all days
Flagstaff, AZ : Sunny on 78% of all days
Sacramento, CA : Sunny on 78% of all days

The sunshine rankings of other noteworthy cities include Key West, FL (#12 with 76% sunshine); Denver, CO (#30 with 68% sunshine); and Seattle, WA (#165 with 43% sunshine).

At the bottom of the list is Juneau. Just 30 percent of the Alaskan capital city's days are sunny.

The complete Sunshine Rankings as listed by Metropolitan Area is available on the NCDC website.

Revamped HARP : Unlimited Loan-to-Value And Same Great Rates

2012-02-10T08:08:00.001-06:00

The government's new, revamped HARP program is 6 weeks from release. Homeowners in Nebraska and nationwide are gearing up to refinance.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the government's loan product for "underwater homeowners". HARP makes current mortgage rates available to households which would otherwise be unable to refinance because the home lacks equity.

This is a big deal -- especially today. Mortgage rates are at an all-time low and millions of U.S. homeowners have been unable to take advantage. HARP aims to change that.

HARP originally launched in 2009. Its first iteration failed to reach a meaningful percentage of U.S. homeowners, however, because costs were high and loans were high-risk. With its re-release, the government has removed the hurdles to HARP, putting refinancing within reach for millions of U.S. households.

To qualify for HARP, homeowners must first meet 3 qualifying criteria.

First, their current mortgage must be backed Fannie Mae or Freddie Mac. FHA- and VA-backed loans are HARP-ineligible, as are jumbo loans and loans backed by portfolio lenders.

To check if your loan if Fannie Mae-backed, click here.
To check if your loan if Freddie Mac-backed, click here.

Second, the existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior on, or before, May 31, 2009. If you bought your home or refinanced it after that date, you are HARP-ineligible.

There are no exceptions to this rule.

And, third, the existing mortgage must be accompanied by a strong repayment history. Mortgage payment must have been paid on-time for the last 6 months, at least, and there may not be more than one 30-day late payment in the last 12 months.

If these 3 qualifiers are met, HARP applicants should find the approval process straight-forward :

Fixed rate mortgages allow unlimited loan-to-value
The standard 7-year "waiting period" after a foreclosure is waived in full
Except in rare cases, home appraisals aren't required

Furthermore, HARP mortgage rates are expected to be on par with non-HARP rates, meaning that HARP homeowners in Omaha will get the same rates and pay the same fees as everyone else. There's no "penalty" for using HARP.

The revamped HARP is expected to be generally available beginning Monday, March 19, 2012.

To get a head-start on HARP, check with your loan officer for the complete list of HARP eligibility requirements.

Quick Tips : Boost Your Credit Score For Better Mortgage Rates

2012-02-09T08:07:00.001-06:00

Credit scores play a huge role in today's mortgage market -- larger than at any time in recent history. Blame it on the high default rates of the last half-decade. Lenders are reserving their lowest rates for the customers most likely to make on-time repayments.

Mortgage rates are at an all-time low in Nebraska. However, the low rates you see advertised on TV and online are only available to the home buyers and would-be refinancers whose credit scores are pristine. Having a high credit score is often the difference between getting "the best rates" from your lender, and getting something worse.

The first part of improving your credit score is understanding how it works. In this 5-minute piece from NBC's The Today Show, you'll learn the basics :

Why you shouldn't close a credit card after you pay off a large debt
What is the maximize balance to leave on your credit cards, relative to your credit limit
What types of credit checks harm your credit scores, and which ones don't

You'll also learn how to shop for a mortgage with multiple lenders without having your credit score "dinged", as well as several proven methods to raise your credit score quickly.

In the end, good credit scores are the result of paying bills on time and staying with your means. Those with the best scores, get the best rates.

Federal Tax Deadline Extended To April 17, 2012

2012-02-08T08:10:00.001-06:00

Traditionally, federal income taxes must be filed with the IRS on, or before, April 15 each year. The date has become such a part of U.S. culture that many people simply call it "Tax Day".

This year, however, for the 3rd time in 7 years, your federal income taxes will not be due April 15. Instead, because of a combination of the calendar, a holiday, and tax law, Tax Day 2012 is delayed until Tuesday, April 17.

You will have two extra days to prepare and file your federal income taxes this year.

Here's why.

First, April 15 is a Sunday and all federal offices are closed on Sundays. This means that that taxes can't be filed on April 15, as regularly scheduled. Rather, the tax due date should roll over to the first available business day -- Monday.

However, Monday, April 16 is Emancipation Day, a holiday in the District of Columbia since 2005.

Emancipation Day honors President Abraham Lincoln's April 16, 1862 signing of the Compensation Emancipation Act. All of Washington, D.C. is closed for the local holiday -- including the offices of the IRS. Taxes can't be due on this date because there will be nobody at the Internal Revenue Service to receive them.

Therefore, Tax Day rolls over to the next available business day, and that's Tuesday, April 17. Despite the 2-day change, as a reminder, the deadline to file a federal tax return with extension has not changed. That filing date remains October 15, 2012.

Also, note that most states have chosen to mirror the IRS' tax deadlines this year even though Emancipation Day is a Washington, D.C-specific. Be sure to check with your accountant to confirm your local filing deadline.

Lock An Instant 13% Savings On Your Monthly Mortgage Payment

2012-02-07T08:06:00.001-06:00

Falling mortgage rates make owning a home more affordable. Mortgage rates are directly tied to monthly mortgage payment so as mortgage rates drop, so does the cost of home-ownership.

It's a money-saving time to buy a home in Papillion -- or to refinance one. Mortgage rates have never been this low in history.

According to Freddie Mac, last week, the average 30-year fixed rate mortgage fell to 3.87% nationwide for borrowers willing to pay an accompanying 0.8 discount points plus closing costs. 0.8 discount points is a one-time closing cost equal to 0.8 percent of your loan size, or $800 per $100,000 borrowed.

This represents an incredible value as compared to February of last year.

It was exactly one year ago that mortgage rates begin their long slide lower. On February 11, 2011, the 30-year fixed rate mortgage reached its peak for the year, reading 5.05% in Freddie Mac's nationwide survey. If you are among the many U.S. households that bought or refinanced a home around that time, you could choose to replace your current home loan with a new one and save close to 13% on your monthly mortgage payment.

13 percent saved on your mortgage is a noteworthy statistic.

Look at this 30-year fixed rate mortgage payment comparison over the last 12 months :

February 2011 : $539.88 principal + interest per $100,000 borrowed
February 2012 : $469.95 principal + interest per $100,000 borrowed

Because of falling mortgage rates, a homeowner with a $250,000 30-year fixed rate mortgage would save at least $175 per month just by refinancing into a new loan at today's mortgage rates. That's $2,100 in savings per year.

Even after accounting for discount points and closing costs, the "break-even point" on a mortgage like that can come relatively quickly.

We can't predict mortgage rates so there's no promise rates will stay like this forever. If you're planning to buy a home or refinance one, the best way to keep your monthly payments down is to lock your rate while rates are still low.

The market looks ripe for that now.

The 10 Longest Commutes In The United States

2012-02-06T07:49:00.001-06:00

According to the Census Bureau, more than 3.2 million U.S. workers spend over 3 hours commuting to and from work each day.

Commutes exceeding 90 minutes in each direction are known as "extreme commutes" in Census Bureau parlance. As compared to typical commute times nationwide, they're aptly named.

The national, average commute time is just 25.1 minutes.

For home buyers in Omaha or in any U.S. city, make sure to make commute times a consideration before placing an offer on a property. The length of your daily commute will make an impact on your life.

Studies shows that shorter commutes are linked to higher levels of life satisfaction. Long commutes are linked to low levels of life satisfaction.

As ranked by the Census Bureau, here are the 10 cities with the longest average commute times, where commuting is defined as the total time to arrive at work, inclusive of all modes of transportation (i.e. automobile, train, subway, foot, or other) :

New York / North New Jersey / Long Island : 34.6 minutes
Washington, DC / Arlington / Alexandria : 33.4 minutes
Poughkeepsie / Newburgh / Middletown, NY: 32.2 minutes

Bremerton / Silverdale, WA : 30.8 minutes

Chicago / Naperville / Joliet, IL : 30.7 minutes

Winchester, VA : 30.3 minutes

Atlanta / Sandy Springs / Marietta, GA 30.1 minutes

Riverside / San Bernardino / Ontario, CA : 30.0 minutes

Stockton, CA : 29.8 minutes

Baltimore / Towson, MD : 29.7 minutes
Poughkeepsie / Newburgh / Middletown, NY: 32.2 minutes
Bremerton / Silverdale, WA : 30.8 minutes
Chicago / Naperville / Joliet, IL : 30.7 minutes
Winchester, VA : 30.3 minutes
Atlanta / Sandy Springs / Marietta, GA 30.1 minutes
Riverside / San Bernardino / Ontario, CA : 30.0 minutes
Stockton, CA : 29.8 minutes
Baltimore / Towson, MD : 29.7 minutes

By contrast, the shortest commute belongs to residents of Great Falls, Montana. The average commute for the city's 58,000 residents is 14.2 minutes.

A long commute to work should not deter you from moving to a particular home or neighborhood, but your time-en-route should be a consideration. Before making an offer on a home , therefore, practice the rush hour commute from your potential new neighborhood in the morning, and back to it again that evening.

Then, imagine making the commute every day.

Banks Start To Loosen Up In Underwriting

2012-02-03T08:05:00.001-06:00

After a half-decade of tightening mortgage guidelines, banks are starting to "loosen up".

The Federal Reserve conducts a quarterly survey of its member banks and, last quarter, not a single responding bank reported having tightened its mortgage guidelines for prime borrowers.

A "prime borrower" is defined as one with a well-documented credit history, high credit scores, and a low debt-to-income ratio.

53 banks responded to the Fed's survey and none said that mortgage guidelines "tightened considerably" or "tightened somewhat" between September and December 2011; 50 said that guidelines remained "basicaly unchanged"; 3 said that guidelines "eased somewhat".

Mortgage applicants sometimes remark that the mortgage approval process can be challenging. Last quarter's Fed survey hints that looser standards are coming.

Not since before the recession have banks lowered mortgage approval standards like this and it bodes well for this year's Omaha housing market. Real estate agents report that 1 in 3 home sale contracts fail with "declined mortgage applications" as a leading cause.

Looser mortgage lending standards should mean more home loan approvals for buyers, and fewer contract cancellations. This can spur the housing market forward.

Make note, though. "Looser standards" should not be confused with "irresponsible standards". It remains more difficult to meet bank standards as compared to 5 years. Today's underwriters are more conservative with respect to household income, overall assets and credit scores.

Even as compared to one year ago:

Minimum credit score requirements are higher
Downpayment/equity requirements are larger
Maximum allowable debt-to-income ratios are lower

For buyers and refinancing households gaining approval, though, the reward is the lowest mortgage rates in a lifetime. Mortgage rates in Nebraska continue to fall, helping home affordability reach new highs.

If you're in the market to buy a new home or refinance one, your timing is excellent.

Home Affordability Threatened By Friday's Jobs Report

2012-02-02T08:03:00.001-06:00

This week, once more, we find mortgage rates are on a downward trajectory. Conforming mortgage rates have returned to near all-time lows. After Friday morning's Non-Farm Payrolls report, however, those low rates may come to an end.

It's a risky time for Nebraska home buyers and would-be refinancers to be without a locked rate.

Each month, on the first Friday, the Bureau of Labor Statistics releases its Non-Farm Payrolls report for the month prior. More commonly called the "jobs report", Non-Farm Payrolls provides a sector-by-sector employment breakdown, and the nation's Unemployment Rate.

In December 2011, the government reported 200,000 net new jobs created, and an Unemployment Rate of 8.5%.

For January 2012, economists project 135,000 net new jobs with no change in the Unemployment Rate and, depending on how accurate those predictions are proved, FHA and conforming mortgage rates are subject to change. The monthly jobs reports tends to have an out-sized influence on the direction of daily mortgage rates.

The connection between jobs and mortgage rates is fairly direct.

Job growth is a key cog in the economic growth engine and mortgage rates change daily based on short- and long-term economic expectation. As more people join the workforce, economic expectations change; the economy tends to expand, breeding optimism among investment. When this occurs, it often spurs investment in the stock market, which tends to leads mortgage rates up.

In short, in a recovering economy, when job growth is strong, all things equal, mortgage rates rise. Home affordability suffers.

So, for today's rate shoppers, Friday's job report represents a risk. The economy has added jobs over 15 straight months, a streak that's added 2.1 million people to the workforce. Although the jobs market remains weak and well off its peaks from last decade, a 15-month streak is worth watching. More jobs means more more income earned nationwide, more money spent by households, and more taxes collected by governments.

This items build a foundation for economic growth and Wall Street is watching.

If tomorrow's Non-Farm Payrolls shows more jobs created than the estimated 135,000, mortgage rates are expected to rise. If the jobs figures falls short, mortgage rates should fall.

The Non-Farm Payrolls report is released at 8:30 AM ET.

Case-Shiller Index Says Detroit And Washington DC Lead The Market

2012-02-01T08:06:00.001-06:00

Standard & Poors released its November 2011 Case-Shiller Index this week. The index measures the change in home prices from month-to-month, and year-to-year, in select U.S. cities.

According to the data, for the second straight month, home values fell in 19 of the Case-Shiller Index's 20 tracked markets. In addition, also for the second straight month, Phoenix, Arizona was the lone Case-Shiller-tracked city in which home values rose.

Overall, November's Case-Shiller Index showed a 1 percent decrease in home values between October and November 2011, and a near-4 percent decrease between November 2010 and 2011, putting home values at roughly the same levels as 8 years ago. Don't read too far into it, however.

The Case-Shiller Index, though widely-cited, remains widely-flawed.

As a buyer or seller , relying on the Case-Shiller Index for market research can lead you to improper conclusions. To understand the Case Shiller Index's methodology is to understand why.

First, the Case-Shiller Index draws its data from a very limited geography.

There are more than 3,100 municipalities nationwide. The Case-Shiller Index tracks just 20 of them. And they're not the 20 largest, either. Four of the Top 10 Most Populous U.S. Cities are excluded (Houston, Philadelphia, San Antonio, San Jose) whereas Minneapolis and Tampa are not.

Minneapolis is the 48th largest city in the United States. Tampa is #55.

Next, when Case-Shiller Index gathers its data from its 20 cities, it only includes the home sale data of single-family, detached homes. This means that sales of condominiums and multi-unit homes are specifically excluded from the index. There are some cities -- Chicago and New York, for example -- where condominium sales represent a large percentage of the overall market.

The Case-Shiller Index ignores that.

And, lastly, when the Case-Shiller Index is published, it's published on a 60-day delay. Its data is not "current", therefore, and does little to tell buyers and sellers of Papillion and the country what's happening in their home markets right this minute. Instead, the Case-Shiller Index tells us how the housing market looked two months ago.

If you're active in the real estate market, either as a buyer or a seller, the Case-Shiller Index does you little good. For real-time data that actionable, speak to a real estate professional instead. It's where you'll find your best, most reliable and relevant information.

Supply Of New Homes At 6.1 Months Nationwide

2012-01-31T08:05:00.001-06:00

New Home Sales slowed into the New Year but the market for newly-built homes remains strong. For home buyers in Nebraska and nationwide, December's New Home Sales report is yet one more signal that the housing market recovery may be underway.

According to the Census Bureau, the number of new homes sold in December 2011 slipped 2 percent to 307,000 units on a seasonally-adjusted, annualized basis nationwide.

A "new home" is a home that is considered new construction; a home for which the buyer will be the first owner and tenant.

As compared to December 2010, last months' sales volume fell seven percent. It's a statistic that suggests housing market weakness. However, in looking at a different component of the New Home Sales report -- the supply of homes for sale -- we're forced to reconsider.

At the current pace of sales, every new home for sale nationwide would be "sold" in a matter of 6.1 months.

Economists believe that a 6.0-month supply defines a market in balance -- anything quicker is termed a "seller's market". Statistics like that are enough to create urgency among today's Omaha home buyers.

Unfortunately, the Census Bureau's data may be wrong.

Although December's New Home Sales report shows sales down 2 percent, the government's data was published with a ±13.2% margin of error. This means that the actual New Home Sales figure may have been as low as -15.2 percent, or as high as +11.2 percent. And, because the range of possible values includes both positive and negative numbers, the Census Bureau had no choice but to assign its December data "Zero Confidence".

It will be a few months before final revisions are made to December New Home Sales data. Until then, therefore, buyers should take cues from the market-at-large and the market-at-large hints at recovery. One example of this is homebuilders showing more confidence in their product than at any time in the last 5 years.

If your plans for 2012 call for buying new construction, therefore, consider using this lull to "make a deal". As the year progresses, the great values in housing may be gone.

5 Simple Ways To Declutter Your Home

2012-01-30T07:48:00.001-06:00

When a home is listed for sale, its "clutter" can be the difference between a rapid sale and no sale at all.

Clutter, in its strictest sense, is defined as anything untidy; or in a disorderly state. In real estate, the term is broadened to include unnecessary furniture pieces; unwieldy artwork or collections; stacks of papers and/or magazines; and anything that otherwise restricts the open flow of a home's floor plan.

In other words, clutter is anything that distracts from your home's natural footprint.

As a home seller in Omaha , understanding how your home's clutter can affect a buyer is paramount to helping your home sell faster, and at a higher contract price.

First, there's the psychological angle. A potential home buyer may see clutter and think "mess". Few people want to buy a house they find messy or otherwise disorganized.

Second, there's the practical angle. A home that appears full of "things" also appears as if its lacking in storage space. This, too, can turn off buyers.

When you list your home for sale, here are basic tips to de-clutter your home. Some of this advice may not be practical with respect to your home, in particular, so make sure to ask your real estate agent for follow-up help.

In each room, remove photos, trophies, plaques and other personal items on display.
Remove large collections such as dolls, cars, miniature cans, and the like.
Remove worn throw rugs
Remove items from kitchen countertops, including small appliances
Remove items from bathroom countertops

You should also consider removing distinctive artwork from your walls, or replacing pieces with items that are more bland.

The over-reaching goal of de-cluttering is to depersonalize and neutralize your home so a buyer can visualize himself/herself living there. De-cluttering your home can also make your home appear larger, accentuating the features of each room.

It's no wonder that minimally-cluttered homes tend to have a wider appeal among buyers.

Pending Home Sales Index Posts Second Best Month Since April 2010

2012-01-27T08:08:00.001-06:00

After 3 consecutive months of growth, the housing market appears to have eased a bit in December.

According to the National Association of REALTORS®, December's Pending Home Sales Index slipped 4 percent from the month prior. The index measures the number of homes under contract to sell nationwide, but not yet sold.

Despite falling below its benchmark "100 value", December's Pending Home Sales Index is the reading's second-highest value since April 2010 -- the last month of last year's home buyer tax credit program.

In other words, the housing market continues to show signs of improvement, propelled by low home prices and the cheapest mortgage rates of all-time.

Freddie Mac's mortgage rate survey put the 30-year fixed rate mortgage at an average of 3.96% in December -- a 75-basis point improvement from December 2010. This helps to make homes more affordable nationwide.

On a regional basis, December's Pending Home Sales Index varied :

Northeast Region: -3.1 percent from November 2011
Midwest Region : +4.0 percent from November 2011
South Region : -2.6 percent from November 2011
West Region : -11.0 percent from November 2011

But even regional data is only so helpful. Like everything in real estate, data must be local to be relevant.

Throughout the West Region, for example, the U.S. region in which pending home sales fell the most, several states must have performed better than the regional average. And, undoubtedly, there were cities, towns, and neighborhoods that experienced marked market growth.

Unfortunately, the Pending Home Sales Index can't capture that data. Nor can it identify the markets in which home sales suffered.

For today's Omaha home buyers and sellers, therefore, it's important to understand your local market and the drivers of local activity. Reports like the Pending Home Sales Index can paint a broad picture U.S. housing but for data that matters to you, you'll want to look local.

For local real estate data, talk to an experienced real estate professional.

A Simple Explanation Of The Federal Reserve Statement (January 25, 2012)

2012-01-25T12:13:00.001-06:00

Wednesday, the Federal Reserve's Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The Fed Funds Rate has been near zero percent since December 2008.

For the third consecutive month, the Fed Funds Rate vote was nearly unanimous. Just one FOMC member dissented in the 9-1 vote, objecting only to the language used in the Fed's official statement.

In its press release, the Federal Reserve noted that the the U.S. economy has "expanding moderately" since its last meeting in December 2011, adding that the growth is occurring despite "slowing in global growth" -- a reference to ongoing economic uncertainty within the Eurozone.

The Federal Reserve expects moderate economic expansion through the next few quarters but is wary of "strains" from global financial markets, and these three threats to the U.S. economy :

The housing sector remains "depressed"
The unemployment rate remains "elevated"
Fixed business investment has "slowed"

On the positive side, the FOMC said that household spending is rising and inflation remains in-check. The group also believes that employment will gradually improve nationwide going forward.

The Federal Reserve neither introduced new economic stimulus, nor discontinued existing market programs.

Immediately following the FOMC's statement, mortgage markets rallied, pressuring mortgage rates to fall in and around Omaha.

Mortgage rates remain near all-time lows and, for homeowners willing to pay points plus closing costs, conventional, 30-year fixed rate mortgages can be locked at below 4 percent. If you're in the process of buying or refinancing a home in Nebraska , it's a good time to lock a mortgage rate with your lender.

The FOMC's next scheduled meeting is a one-day event slated for March 13, 2012.

The Federal Reserve Meets Today : Mortgage Rates Expected To Move

2012-01-25T08:05:00.001-06:00

The Federal Open Market Committee adjourns from a scheduled 2-day meeting today, its first of 8 scheduled meetings this year.

The FOMC is a designated, rotating, 12-person committee within the Federal Reserve, led by Federal Reserve Chairman Ben Bernanke. Members of the FOMC sub-committee are the voting members of the Federal Reserve; the ones that ultimately determine U.S. monetary policy.

The most well-known Federal Reserve monetary policy tool is the central bank's Fed Funds Rate. The Fed Funds Rate is the prescribed interest rate at which banks borrow money from each other for a period of one night.

The Fed Funds Rate can only be changed by FOMC vote.

For home buyers and would-be refinancing households in Omaha , it's important to recognize that the Fed Funds Rate is an interest rate separate and distinct from "mortgage rates". Mortgage rates are not voted upon by the Federal Reserve. Rather, mortgage rates are based on the price of mortgage-backed bonds, a security bought and sold among investors.

Historically, there is little correlation between the Fed Funds Rates and 30-year fixed rate mortgage rates throughout Nebraska. Going back 20 years, the benchmark rates have been separated by as much as 5.29% and have been as near as 0.52%.

The spread has even gone negative, most recently in 1979 and 1981 -- a period marked by high inflation.

Today, the separation between the Fed Funds Rate and the average, 30-year fixed rate mortgage rate is roughly 3.60%. Beginning at 12:30 PM ET, however, that spread is expected to change. The FOMC will make its statement to the press at that time, and will release its quarterly forecast to the markets.

As Wall Street reacts to the Fed's press release and projections, mortgage rates will move.

Investors expect the Fed to vote the Fed Funds Rate unchanged from its current range near 0.000 percent, but are unsure of how the Fed will characterize the U.S. economy. If the Fed speaks optimistically on the economy, stock markets should rise and mortgage bonds should fall, driving mortgage rates higher.

Conversely, if the Fed shows concern for future economic growth, mortgage rates should drop. Either way, today figures to be volatile one for mortgage markets.

When mortgage markets get volatile, the safe play as a rate shopper is to lock your mortgage rate immediately. There too much risk in floating.

Existing Home Sales Approach Bull Market Territory

2012-01-24T08:06:00.001-06:00

The housing market finished 2011 with strength, and is carrying measurable momentum into 2012.

According to data from the National Association of REALTORS®, on a seasonally-adjusted, annualized basis, December's Existing Home Sales climbed by 120,00 units overall from the month prior on its way to an 11-month high.

An "existing home" is a home that's been previously occupied; that cannot be considered new construction.

After 4.61 million existing homes were sold in December, there are now just 2.38 million homes for sale nationwide. The last time the national home supply was this sparse was March 2005.

At today's sales pace, the complete, national home inventory would be exhausted in 6.2 months -- the fastest pace since before the recession. A 6.0-month supply is believed to represent a market in balance.

The December Existing Home Sales report contained noteworthy foreclosure and short sale statistics, too :

Foreclosures sold at an average discount of 22% to market value
Short sales sold at an average discount of 13% to market value
Together, foreclosures and short sales accounted for 32% of all home sales

Clearly, "distressed homes" remain a large part of the U.S. housing market.

Furthermore, in its report, the real estate trade group also noted that one-third of homes under contract to sell nationwide succumbed to contract failure last month. That's up from 9% one year ago.

Contract failure occurs for a multitude of reasons, most notably homes appraising for less than the purchase price; the buyer's failure to achieve a mortgage approval; and, insurmountable home inspection issues. December's high failure rate underscores the importance of getting pre-approved as a buyer, and of buying homes in "good condition".

For today's home buyer in Elkhorn , December's Existing Home Sales figures may be construed as a "buy signal". Home supplies are dropping and buyer demand is rising. This is the basic recipe for higher home prices ahead.

If your 2012 plans call for buying a home, consider that home values throughout Nebraska are expected to rise as the year progresses. The best values of the year may be the ones secured this winter.

When Should I Change My Home's Air Filters?

2012-01-23T07:49:00.001-06:00

How long has it been since you last changed your home's air filters?

Home air filters trap and remove dust and particles from the air you breathe; leaving "clean air" to circulate your home.

Clean air in your home is important because it promotes better health.

One way to keep to keep your home's air as clean as possible is to replace its used air filters at least once per quarter; or once monthly in homes with shedding pets or that otherwise "get dusty".

Changing air filters is among the easier do-it-yourself chores for a Elkhorn homeowner; a task that takes less than one minute. The secondary benefit of doing it is that new filters help keep your HVAC unit in tip-top shape.

Here's how to change your home's air filter :

Open the air filter compartment door/slider on your HVAC unit.
Note the size of your current filter. It's typically written on the frame.
Note the direction in which the filter is pointing. There may be an arrow on its frame.
Purchase a new filter at a hardware store. Make sure the sizes matches the size from Step 2.
Remove the old filter.
Replace old filter with the newly purchased one from Step 4. Make sure the arrow is pointing in the same direction as the original filter's arrow.
Using a marker, note the date of filter change on the side of the filter.
Close the air filter compartment door/slider.

And that's it.

When you find a filter type and style that you like, consider buying them in bulk -- it can be helpful to have extra air filters laying around the home for when you need them -- especially during season changes when you may want to replace filters more frequently.

In addition, when purchasing air filters, don't opt for the cheapest available. Often, the least expensive filters allow large particles to recirculate through the HVAC unit, and back in to your home. Choose a middle- or top-line product instead.

Your home and your health will thank you.

Behind The Housing Starts Headlines, The Story That Matters

2012-01-20T08:07:00.001-06:00

When it comes to housing data, sometimes you have to look past the headlines. December's Housing Starts data offers a terrific illustration of why.

Each month, the Census Bureau tallies Housing Starts for the month prior. A "housing start" is a home on which construction has started.

The Housing Starts report is separated by property type. There is a count for single-family homes; a count for 2-4 unit homes; and a count for buildings of 5 units or more, a category including apartments and condominiums.

In December, as reported by the government, Housing Starts fell 4 percent nationwide overall. This runs contrary to recent strength in housing and the story was quickly picked up by the press :

U.S. Housing Starts Fall More Than Forecast (BusinessWeek)
U.S. Housing Starts Fall (MarketWatch)
December Housing Starts Are Worse Than Expected (Fox Business)

Now, although these headlines are factually true, they're also are a little bit misleading.

Housing Starts did fall 4 percent last month but that was for all Housing Starts, across all three property types. Data like this is somewhat irrelevant to home buyers in Nebraska or anywhere else nationwide.

Few buyers purchase 2-4 unit homes, and almost nobody purchases an entire apartment building. Rather, it's the Housing Starts reports' "single-family" tally that matters because that's the home type that the majority of home buyers purchase.

In December, for the fourth straight month, Single-Family Housing Starts increased.

Single-family housing starts climbed 4 percent last month to 470,000 units on a seasonally-adjusted, annualized basis. This is the highest number of Single-Family Housing Starts since April 2010 -- the last month of last year's home buyer tax credit.

The Single-Family Housing Starts data is the latest in a series of data that point to a housing rebound nationwide. New Home Sales, Existing Home Sales, Pending Home Sales and Homebuilder Confidence has each posted multi-month highs and all are poised for strong gains into 2012.

If you're planning to buy a home in 2012, consider buying in between now and March rather than at some point later. Home prices -- and mortgage rates- are likely to move higher.

Home Builders See More Sales, Higher Prices Ahead

2012-01-19T08:07:00.001-06:00

Homebuilder confidence is soaring.

For the fourth straight month, the National Association of Homebuilders reports an increase in its Housing Market Index. The index climbed 4 points to 25 this month -- its second four-point gain since October.

With home sales activity increasing across all four regions, the monthly HMI has now nearly doubled in value since June 2011.

The HMI is now at a 55-month high.

The Housing Market Index itself is a composite reading; the result of three home builder surveys sent by the National Association of Homebuilders to its members monthly. Home builders report back on current single-family home sales volume; projected single-family home sales volume for the next 6 months; and current buyer "foot traffic".

The NAHB then results compiles the surveys into a single reading.

In January, home builders reported improving sales conditions across all three categories :

Current Single-Family Sales : 25 (+3 from December)
Projected Single-Family Sales : 29 (+3 from December)
Buyer Foot Traffic : 21 (+3 from December)

The Housing Market Index corroborates recent U.S. government data that suggests housing is mending in Nebraska. Both Housing Starts and New Home Sales have out-performed expectations of late, it's been shown, and the stock of new homes for sale nationwide is dwindling.

All of this, of course, is happening as demand from buyers heats up. Foot traffic through builder homes is higher than it's been in more than 3 years, say the builders -- a time period that includes the duration of the 2010 home buyer tax credit.

It's no surprise, therefore, that builders expect a strong 2012.

Jobs data is improving, mortgage rates remain low, and housing momentum is building. For home buyers in Papillion , however, it may spell higher home prices ahead. Big demand and small supply creates scarcity and scarcity correlates to rising prices.

If you're shopping new homes, the best "deal" may be the one you find today.

Foreclosure Filings Fall To 49-Month Low

2012-01-18T08:04:00.001-06:00

Foreclosure filings are fewer these days, according to foreclosure-tracking firm RealtyTrac.

In December 2011, the number of foreclosure filings nationwide fell 9 percent from the month prior. Not since November 2007 has foreclosure activity been this sparse across the country.

The drop does not appear to be seasonal, either.

Last month's foreclosure filings were down 20 percent from December 2010 with "foreclosure filing” defined to include any one of the following foreclosure-related events : (1) The serving of a default notice, (2) A scheduled home auction, or (3) A bank repossession. As a result of a unexpectedly strong year-end, 2011's annual foreclosure rate was the lowest in 4 years.

One reason why the year may have closed so strongly is that Nevada, California, Michigan and Arizona -- four states typically associated with high rates of foreclosures -- each posted big drops in foreclosure filings between November and December, plus double-digit drops between December 2010 and December 2011.

In fact, among the country's top 10 states for foreclosure activity, nine showed an annual foreclosure filing reduction.

Only Delaware worsened.

It’s also noteworthy that just 4 states accounted for half of last month's total foreclosure filings.

California : 25.8 percent of all foreclosure filings
Florida : 12.0 percent of all foreclosure filings
Michigan : 6.4 percent of all foreclosure filings
Illinois : 6.2 percent of all foreclosure filings

Foreclosures are heavily concentrated, in other words. By contrast, the last 1% of activity is spread across 14 states.

As a Omaha home buyer -- first-timer or investor -- foreclosures can be a great way to find value.

According to the National Association of REALTORS®, distressed homes typically sell at "deep discounts" as compared to like, non-distressed homes. However, when you buy a foreclosure home from a bank, it's different from buying a home from a "person". Purchase contract negotiations are different and months may pass before your closing is approved.

If you're buying foreclosure, therefore, seek the help of a professional real estate agent. Real estate agents have experience working in the process-heavy world of foreclosures and can help you come out ahead.

How To Clean An Exposed, Interior Brick Wall

2012-01-17T07:49:00.001-06:00

Exposed interior brick can add a nice, decorative touch to your Elkhorn home, but because brick is a porous material and prone to staining, it can be cumbersome to clean.

Standard household detergents alone are rarely enough to clean brick properly, so if your home features exposed interior brick, plan to use alternative cleaning methods instead.

Here is how to do it.

First, find a pair of sturdy rubber gloves to protect your hands from the harsh brick surface and from your cleaning agents. Then, with a dry dish cloth, gently wipe the entire surface of the brick wall to remove loose dirt and dust.

Next, pour a grease-cutting dish detergent into a small bucket. Do not add water to the detergent. Add a small amount of table salt instead.

Mix well.

Next, apply a thin layer of the soap-and-salt mix to the bricks using a cloth and allow the mix to sit on the bricks for 10-15 minutes. Then, with a hard-bristled scrub brush, gently scrub the brick to remove the stubborn dirt.

Lastly, dip a clean dishcloth into a warm water-filled bucket and use the dishcloth to remove the detergent mix from the wall.

Allow the wall to air dry.

Cleaning exposed interior brick is more complicated than cleaning other household surfaces but a clean brick wall can help reduce in-home health hazards and keep your brick in its best possible condition for the long-haul.

Will Home Values Rise This Year?

2012-01-13T11:24:00.001-06:00

Will your home gain value over the next 12 months? Nobody can know for sure, of course, but should recent housing trends continue, there's concrete cause for optimism.

The housing economy has suffered since 2007, knocking home values down nearly 20% nationwide. And while some areas have fared better as compared to others but, in general, home values are down.

Mortgage rates are down, too, and that's good news for buyers in Omaha. The combination of low rates and low prices has led home affordability to an all-time high. As you'll hear in this 4-minute interview with NBC's The Today Show, carrying a mortgage costs 25% less per month as compared to just 3 years ago.

Some other notes from the interview include :

There are more buyers out looking for homes today, which leads to more sales
The housing market is expected to get gradually better, month-by-month, in 2012
Foreclosures will continue to be a big part of the housing market

With housing supplies shrinking, buyers throughout Nebraska may find their best "deals" today -- before the Spring Buying Season begins in February.

However, we can't forget that housing markets are local -- not national. Each town and neighborhood has its own market drivers and prices where you live may have already started to climb.

For accurate, up-to-date data on the housing market, talk with a local real estate agent.

Home Affordability Set To Worsen On Thursday's Retail Sales Data

2012-01-11T08:07:00.002-06:00

Consumer spending continues to rise nationwide, fueled by jobs growth and a rosier outlook for the U.S. economy. Unfortunately for mortgage rate shoppers Omaha Nebraska, it may also lead to higher mortgage rates later this week.

Thursday morning, the Census Bureau will release its U.S. Retail Sales data for December. The report is expected to show an 18th consecutive monthly increase, with analysts projecting sales volume higher by 0.4 percent from November.

This would be double the increase from last month, which saw a 0.2 percent increase in Retail Sales.

The Retail Sales report tallies receipts collected by retail and food-service stores nationwide. When the sum of these receipts rise, it puts pressure on mortgage rates to do the same. The connection is straight-forward.

Retail Sales are the largest part of "consumer spending" and consumer spending accounts for the majority of the U.S. economy -- up to 70 percent, by some estimates.

As the economy goes, so go mortgage rates.

Remember: today's ultra-low mortgage rates have been partially fueled by weak economies -- both domestic and abroad -- going back 4 years. Stock markets have sold off as economies have faltered worldwide, leading investors to seek refuge in the relative safety of U.S.-backed mortgage bond market. The new-found demand for mortgage-backed bonds has helped drop mortgage rates to levels never seen in history.

When economic recovery is apparent, therefore, we should expect a mortgage rate reversal, and should expect for it to happen quickly. Stock markets should rise; bond markets should fall. Mortgage rates will climb. Rate shoppers will lose.

Last week's strong jobs report sparked hope for the U.S. economy. If Thursday Retail Sales data reveals similar strength, the risk in "floating" your mortgage rate may be too great. The safer play is to lock your rate today.

The Retail Sales report will be released at 8:30 AM ET.

Lock Your Mortgage Rate : New Loan Fees Expected Within Days

2012-01-10T08:04:00.001-06:00

Starting soon, nearly all home buyers and refinancing households throughout Nebraska and nationwide will pay higher mortgage loan fees. Congress has made it law.

13 months ago, as part of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Congress enacted a one-year cut to FICA payroll taxes.

FICA stands for Federal Insurance Contributions Act. Taxes collected under FICA fund such programs as Social Security and Medicare.

The stimulus plan temporarily lowered tax rates for salaried workers from 6.2% to 4.2%; and for self-employed persons from 12.4% to 10.4%. Effective January 1, 2012, "regular" tax rates were to return.

That is, until late-December 2011. In one of its last moves of the year, Congress passed a temporary, two-month extension to the payroll tax cut, extending it through February 29, 2012. The expected cost to the U.S. Treasury is $33 billion.

To recoup those costs, Congress has turned to Fannie Mae, Freddie Mac and the FHA.

Each entity has been ordered to collect news fees on each new mortgage is backs, and has been told to forward said fees to U.S. Treasury directly. There's no "workaround" allowed or forgiveness applied -- each new loan is subject to the payment.

The rules are listed on page 17 of the law's final draft, in a section unambiguously titled "Title IV -- Mortgage Fees and Premiums".

According to the law :

Fannie Mae and Freddie Mac must collect an average fee of no less than 10 basis points (0.1%) per new loan
The FHA must raise its monthly mortgage insurance premiums 10 basis points for all new loans

The expected cost to consumers is no less than $10 monthly per $100,000 borrowed. Some analysts, however, expect Fannie Mae and Freddie Mac to collect more than is minimally required. This could add an additional $30-50 to your monthly mortgage payment per $100,000 borrowed.

Therefore, if you've been shopping for a home or for mortgage rates in Omaha , take advantage. Within days, lenders are expected to start collecting Payroll Tax Extension fees from mortgage applicants -- a move that will cost you money.

Lock today to avoid the big fees. Save yourself money.

How To Clean Your Microwave Without Harsh Chemicals

2012-01-09T07:48:00.001-06:00

Microwaves are often well-worn. Spills and splatters dot their ceilings; splattered food stuffs line their walls.

To clean your microwave, you can use the harsh chemicals on sale at supermarkets and hardware stores, or you can apply an all-natural approach which yields the same results, with only slightly more preparation time.

The extra time may be worth it, too, considering that the chemicals of an over-the-counter cleaner may seep into your foods over time.

To keep your microwave fresh and clean, using organic materials only, here's what to do :

Unplug your microwave from the wall for safety.
Gather a microwave safe bowl; 1 1/4 cups of water; a lemon; baking soda; white vinegar; and cleaning cloths.
Slice the lemon and place the slices into your bowl. Add the water.
Heat the bowl in the microwave for 7 minutes. Leave the microwave door closed for an additional 5 minutes.
Remove the bowl (CAUTION : Bowl will be hot).
Remove the microwave's glass cooking surface and wheel system. Hand wash and set aside to dry.
Dip a clean cloth in the lemon water mixture.
Wipe down the microwave's exterior and interior surfaces, remoistening the cloth as required.
Moisten a clean cloth with vinegar. Wipe down the microwave door's interior surface.
Replace glass and wheel system, and plug the microwave back in to the wall.

If you find lingering stains in your microwave, mix baking soda with water to form a thick paste. Dip a corner of your cleaning cloth into the paste and apply it to the stain directly, gently rubbing in a circular motion until the stain is gone.

Microwaves should be cleaned at least once weekly for optimal performance.

Adjustable-Rate Mortgages Are A Relative Bargain Today

2012-01-06T08:07:00.001-06:00

For buyers and refinancing households throughout Nebraska , adjustable-rate mortgages are a relative bargain as compared to fixed-ones.

According to Freddie Mac's weekly survey of more than 125 banks nationwide, Papillion mortgage applicants electing for a conventional ARM over a conventional fixed-rate mortgage will save 105 basis points on their next mortgage rate.

"Conventional" loans are loans backed by Fannie Mae or Freddie Mac.

Today's average, conventional 30-year fixed rate mortgage rate is 3.91% plus points and closing costs. The average rate for a comparable 5-year ARM is 2.86%, plus points and closing costs.

In other words, for every $100,000 borrowed, a conventional 5-year adjustable-rate mortgage will save you $58.15 per month, or $698 per year.

That's a 12 percent savings just for choosing an ARM.

12 percent is a big figure that adds up over 5 years -- especially for households that plan to sell within those first 60 months anyway. There is little sense in paying the mortgage rate premium for a 30-year fixed-rate mortgage when a 5-year ARM is perfectly suitable.

For the reason why adjustable-rate mortgages continue are so much lower than their fixed-rate counterparts, look no further than the U.S. economy. ARMs reflect Wall Street's short-term economic expectations; whereas fixed-rate mortgages reflect medium- to long-term expectations.

In the short-term, analysts expect the U.S. economy to grow slowly, with low levels of inflation. This supports the U.S. dollar, the currency in which mortgage bonds are denominated. When the dollar is strong, demand for mortgage bonds tends to increase.

This supports lower interest rates.

Conversely, over the longer-term, inflation is expected to return, which devalues the dollar and everything paid in it (e.g.; mortgage-backed bonds). This is why inflation is linked to higher mortgage rates. When inflation is present in the economy, mortgage bonds lose value, driving mortgage rates up.

Adjustable-rate mortgages aren't perfect for everyone, but in the right situation, they can be a big money-saver and a helpful tool for stretching a household budget. Given today's rates, the money-saving potential is larger than usual.

Before you choose an ARM, discuss your options with your loan officer.

Are You Locked ? Friday's Job Report Will Make Mortgage Rates Move.

2012-01-05T08:04:00.001-06:00

If you're floating a mortgage rate, or have yet to lock one in, today may be a good day to call your loan officer. Friday morning, the government releases its Non-Farm Payrolls report at 8:30 AM ET.

The Non-Farm Payrolls report is more commonly called the "jobs report" and, lately, it's been Wall Street's domestic economic metric of choice. As jobs go, so go markets.

In the 12 months beginning November 2007, the economy shed 2.3 million on its way to losing more than 7 million jobs by the end of 2009.

It's no coincidence that the stock market has been wayward. Jobs are a keystone in the U.S. economy and the connection between jobs and growth is straight-forward :

Workers spend more than non-workers and consumer spending is the economy's largest single component
Workers pay more taxes to governments and, when governments have money, they build and spend on projects
Additional consumer and government spending creates revenue for businesses which, in turn, hire more workers.

It's a self-reinforcing cycle. More employees begets more employees.

As a rate shopper in Nebraska , this is an important understanding. Job loss was, in part, behind the big drop in mortgage rates since 2007. A weak economy drives investors away from equities and into safer securities such as mortgage bonds (which are backed by the U.S. government).

The excess demand causes mortgage rates to drop and that's exactly what we've seen. Since late-2007, mortgage rates have been in decline.

In the first 11 months of 2011, though, 1.5 million people went back to work; the economy showed signs of shoring up and economic optimism is returning. Mortgage markets have temporarily ceded to the Eurozone, but with one more strong jobs report to close out the year, momentum could tip and stock markets could roll.

If that happens, mortgage rates will rise. Maybe by a lot.

This is why Friday's Non-Farm Payrolls data is so important. Economists expect that 150,000 new jobs were created in December. If the government's actual number is larger than that, prepare for higher mortgage rates.

Conversely, if job creation falls short of 150,000, mortgage rates may fall.

If the prospect of rising mortgage rates makes you nervous, remove your nerves from the equation. Call your loan officer and lock your rate ahead of Friday's Non-Farm Payrolls release.

Housing And Mortgage : The Experts Make Their 2012 Predictions

2012-01-04T08:02:00.001-06:00

As the new year begins, there are no shortage of stories telling us what to expect in 2012. Housing finished 2011 with momentum and mortgage rates closed at the lowest rates of all time.

Some expect those trends to continue through the first quarter and beyond. Others expect a rapid reversal.

Who's right and who's wrong? A quick look through the newspapers, websites and business television programs reveals "experts" with opposing, well-delivered arguments views. It's tough to know who to believe.

For example, here are some "on-the-record" predictions for 2012 :

Home prices will rise in 2012 (says Freddie Mac)
Home prices will fall in 2012 (says CBS News)
Mortgage rates will rise in 2012 (says American Banker)
Mortgage rates will fall in 2012 (ays the LA Times)

The issue for buyers, seller, and would-be refinancers in Elkhorn and nationwide is that it can be a challenge to separate a "prediction" from fact at times.

When an argument is made on the pages of a respected newspaper or website, or is presented on CNBC or Bloomberg by a well-dressed, well-spoken industry insider, we're inclined to believe what we read and hear.

This is human nature.

However, we must force ourselves to remember that any analysis about the future -- whether it's housing-related, mortgage-related, or something else -- are based on a combination of past events and personal opinion.

Predictions are guesses about what might come next -- nothing more.

For example, at the start of 2009, few people expected the 30-year fixed rate mortgage to stay below 6 percent, but it did. Then, at the start of 2010, few people expected the 30-year fixed rate mortgage to stay below 5 percent, but it did.

All we can know for certain about today's market is that both mortgage rates and home values are low, creating favorable home-buying conditions nationwide.

At that start of last year, few people expected mortgage rates to even reach 4 percent. Today, rates "with points" price in the 3s.

What 2012 has in store we just can't know.

How To Clean An Oriental Carpet

2012-01-03T07:51:00.001-06:00

If you own oriental rugs, you'll want to clean them at least once annually. But take special care -- the process of cleaning an oriental rug is different from cleaning plain carpet.

Extreme caution is required.

To clean an Oriental rug, first vacuum the rug on both sides, then follow these cleaning instructions:

Prepare a solution of cool water and gentle shampoo (i.e. shampoo without ammonia)
Test the solution on tiny corner of the rug to make sure that the rug's colors won't bleed
Using a soft brush or dense sponge, brush the rug with the shampoo solution
Use only light pressure and follow the "grain" of the rug
Shampoo the rug's fringe, then comb it gently with a large comb or brush
Rinse the entire rug and press out as much water as possible
Lay the rug flat and leave it to dry

After several hours, test the front of the rug for moisture. When it feels dry, flip the rug over to dry its back.

Note : Do not dry an oriental rug in the sun because the sun's rays may cause it to fade.

Once both sides of the rug are totally dry, feel the top surface. If it feels stiff, crunchy or hard, take a dry brush and make gentle strokes. A light vacuuming will also do the job.

Oriental rugs that receive proper care can become family heirlooms, passed down from one generation to the next. Make sure you clean yours properly.

Pending Home Sales Index Rises Back Above 100

2011-12-30T08:07:00.001-06:00

Low home prices and mortgage rates have combined to push home affordability to record levels nationwide. Home buyers are taking advantage.

The Pending Home Sales Index rose 7 percent in November to rise to its highest level since April 2010, the last month of last year's home buyer tax credit program.

The Pending Home Sales Index is published monthly by the National Association of REALTORS®. It measures homes under contract nationwide, but not yet "sold".

In this way, the Pending Home Sales Index is different from other housing market indicators. It's a "forward-looking" figure; a predictor of future home sales. According to the National Association of REALTORS®, more than 80% of homes under contract close within 60 days.

By contrast, housing data such as the Existing Home Sales report and the New Home Sales report "look back".

November marks the second straight month of Pending Home Sales Index improvement. The housing market metric made big gains of 10 percent in October 2011, as well.

On a regional basis, each part of the country showed an increase in homes under contract.

Northeast Region: +8.1 percent from October 2011
Midwest Region : +3.3 percent from October 2011
South Region : +4.3 percent from October 2011
West Region : +14.9 percent from October 2011

However, here in Elkhorn, we must discount the value of even the regional data, somewhat. Like else in real estate, the volume of homes going under contract vary by locality.

Throughout the West Region, for example, the region in which pending home sales increased the most from October, there are nearly a dozen states. Undoubtedly, some of those states performed better than others in terms of "homes under contract", but we don't have an indication of which states those were.

In addition, within each state, every city, town, and neighborhood realized its own unique market in November, and produced its own sales statistics.

For buyers and sellers throughout Nebraska and the country, therefore, it's more important to watch data on a local level than on a national one. Reports like the Pending Home Sales Index are helpful in showing national trends, but as an individual, what you need are local trends.

For local real estate data, be sure to ask your agent.

Nationally, Home Prices Off 18.3 Percent From April 2007 Peak

2011-12-29T08:11:00.001-06:00

The government confirms what the private-sector Case-Shiller Index reported yesterday. Nationwide, average home values slipped in October.

The Federal Home Finance Agency's Home Price Index shows home values down 0.2% on a monthly, seasonally-adjusted basis. October marks just the second time since April that home values fell month-over-month.

The Case-Shiller Index 20-City Composite showed values down 0.7 percent from September to October.

As a home buyer in Elkhorn , it's easy to look at these numbers and think housing markets are down. Ultimately, that may prove true. However, before we take the FHFA's October Home Price Index at face value, we have to consider the report's flaws.

There are three of them -- and they're glaring. As we address them, it becomes clear that the Home Price Index -- like the Case-Shiller Index -- is of little use to everyday buyers and sellers.

First, the FHFA Home Price Index only tracks home values for homes backed by Fannie Mae or Freddie Mac mortgages. This means that homes backed by the FHA, for example, are specifically not computed in the monthly Home Price Index.

In 2007, this was not as big of an issue as it is today. in 2007, the FHA insured just 4 percent of the housing market. Today, the FHA is estimated to have more than one-third of the overall housing market.

This means that one-third of all home sales are excluded from the HPI -- a huge exclusion.

Second, the FHFA Home Price Index excludes new home sales and cash purchases, accounting for home resales backed by mortgages only. New home sales is a growing part of the market, and cash sales topped 29 percent in October 2011.

Third, the Home Price Index is on a 60-day delay. The above report is for homes that closed in October. It's nearly January now. Market momentum is different now. Existing Home Sales and New Home Sales have been rising; homebuilder confidence is up; Housing Starts are showing strength. In addition, the Pending Home Sales Index points to a strong year-end.

The Home Price Index doesn't capture this news. It's reporting on expired market conditions instead.

For local, up-to-the-minute housing market data, skip past the national data. You'll get better, more relevant facts from a local real estate agent.

Since peaking in April 2007, the FHFA's Home Price Index is off 18.3 percent.

New Home Sales Approach Bull Market Territory

2011-12-28T08:08:00.001-06:00

New home inventory is approaching bull market territory.

According to the Census Bureau, the number of new homes sold rose 2 percent in November. On a seasonally-adjusted, annualized basis, home buyers bought 315,000 newly-built homes last month.

November's New Home Sales data marks the 4th straight month of rising sales volume, lifting the housing-market metric to a 7-month high, and adding to the housing market's recent show of strength.

Last week, we learned that Existing Home Sales also climbed in November.

The big story in the New Home Sales report, though, is the remaining new home supply nationwide.

With just 158,000 homes "on the market" and the pace of home sales hastening, the complete, national inventory of "new homes" would now be sold in just 6.0 months, a 0.2-month improvement from October. This is the quickest home sales pace in nearly 6 years for the new construction market.

It's even faster than in April 2010 -- the buyer-deadline month of last year's federal home buyer tax credit.

Home builders expect the trend to continue, too. Buyer foot traffic is on the rise and builders have a strong outlook for the next 6 months.

It's an unsettling series of developments for today's Omaha home buyers. As home supplies drop and builders gain confidence, the ability of an buyer to negotiate for price reduction and/or upgrades shrinks.

If you're a home buyer in search of new construction, therefore, consider that the best new construction "deals" of the next 12 months may be the ones you find today.

America's To 10 Safest Cities, Ranked

2011-12-27T08:09:00.001-06:00

Looking for safe cities in which to live? A recent study may help you.

Titled "America's Safest Cities", Forbes Magazine compiled data from more than 70 cities with populations of 250,000 or more, and ranked them by violent crime rate as reported by the Federal Bureau of Investigation.

A "violent crime" is one that can be categorized as murder, robbery, and assault, among others. Then, for each metropolis, local traffic-fatality rates were added to the area's violent crime rate, and averaged into the data.

Forbes presents the 10 safest large cities in America as :

Plano, Texas
Henderson, Nevada
Honolulu, Hawaii
Santa Ana, California
Lincoln, Nebraska
San Jose, California
Mesa. Arizona
Colorado Springs, Colorado
Aurora, Colorado
New York, New York

Forbes is quick to note that "gridlocked" traffic patterns help keep cities safe; which may explain why cities like Honolulu and New York City made the Top 10. When cars are forced to move more slowly, the report states, traffic-related fatalities tend to plummet.

Don't rush to make a home-buying decision based on Forbes data alone, however. Like everything else in real estate, data is local and city-wide statistics are too broad to be helpful to an everyday buyer in Elkhorn.

For accurate, real-time, local crime data, be sure to ask a real estate profession.

Pay Your Mortgage Early, Boost Your 2011 Federal Income Tax Deductions

2011-12-23T08:09:00.001-06:00

Time is running out to boost to your 2011 federal tax refund. All you have to do is make your January 2012 mortgage payment while it's still December.

It's a simple tax strategy that works because of how mortgage interest is paid, and of how the U.S. tax code is written.

Different from rent which is paid for the month ahead (i.e. "you're paying January's rent"), mortgage payments are made only after mortgage interest has accrued (i.e. "you're paying for money you've already borrowed from the bank").

This is called "paying interest in arrears" and U.S. tax code states that the mortgage interest is tax-deductible in its year paid, subject to limitations.

By making the January 2012 mortgage payment in December 2011, therefore, homeowners who itemize their on their tax returns can apply their January mortgage payment's interest portion to their 2011's tax returns.

The alternative is to pay the mortgage on schedule, and wait for April 15, 2013 to claim the credit.

If you choose to pre-pay your mortgage and typically send your payment via USPS, give your check ample time to be delivered to your lender, and processed. Mail your check no later than Saturday, December 24.

For Omaha homeowners that pay electronically, the process is simpler. Edit your online bill pay program to have your mortgage payment post no later than Thursday, December 29.

Make note, however. Not all mortgage interest is eligible for tax-deductibility, and not all homeowners throughout the state of Nebraska who pay mortgage interest should itemize said interest on their tax returns.

Before prepaying on your mortgage, ask your tax professional for advice.

Home Supplies Fall To 7.0 Months Nationwide; Buyer Demand Strong

2011-12-22T08:07:00.001-06:00

Home resales moved to a 10-month high in November, the latest in a series of strong showings from the housing sector.

According to the National Association of REALTORS®, November's Existing Home Sales rose to a seasonally-adjusted, annualized 4.42 million units nationwide -- a 4 percent climb from October 2011.

An "existing home" is a home that has been previously occupied and cannot be categorized as new construction.

Home buyers and sellers throughout Elkhorn should take note of November's numbers because -- behind the headlines -- there's a series of statistics that foretell higher home prices ahead.

First, the total number of homes for sale nationwide dipped to 2.58 million, an 18% reduction from November 2010 and represents the fewest number of homes for sale since February 2007.

At the current sales pace, the complete home resale inventory would be sold in 7.0 months.

And, second, the real estate trade group reports that 33% of all homes under contract "failed" for some reason last month.

Contract failures can occur because of mortgage denials in underwriting; home inspection issues; and homes appraising for less than their respective purchase prices.

In other words, despite a reduction in the number of homes for sale, and a rash of failed contracts, Existing Home Sales volume is still on the rise.

Broken-down by buyer-type, here's to whom home sellers were selling in November :

First-time buyers : 35% of home resales, up from 34% in October 2011
Repeat buyers : 46% of home resales, down from 48% in October 2011
Investor buyers : 19% of home resales, up from 18% in October 2011

Given high demand for home resales and shrinking home supplies, we should expect that home prices will rise through December 2011 and into early-2012, at least. Recent Housing Starts data supports this notion.

Thankfully, mortgage rates remain low. Low mortgage rates help keep homes affordable.

Housing Starts Show Strength In Housing

2011-12-21T10:51:00.001-06:00

The new construction housing market continues to show strength across the country.

According to the U.S. Census Bureau, Single-Family Housing Starts rose to 447,000 units on a seasonally-adjusted, annualized basis in November -- a 2 percent increase from October.

A "Housing Start" is defined as breaking ground on new home construction.

November's figures mark the third straight month of Single-Family Housing Starts gains. The new construction metric is now 15 percent above its all-time low, set in February of this year.

None of this should be a surprise to new home buyers in Papillion.

Housing data has been trending better since September with sales volumes rising and home inventories falling. Basic economics tells us that home prices should soon rise.

The good news is that low mortgage rates should keep homes affordable.

Since mid-November, the average, conventional 30-year fixed rate mortgage has hovered near 4.000% nationwide with an accompanying 0.7 discount points plus closing costs. 1 discount point equals one percent of your loan size. This is down from near 4.500% six months ago, and the drop has made a big impact on home affordability.

June 2011 : $200,000 mortgage costs $1,013.37 per month
December 2011 : $200,000 mortgage costs $954.83 per month

This represents $700 in savings per year. It's no wonder home builders report the highest buyer foot traffic in 3 years.

Meanwhile, the market shows little signs of slowing down. Building Permits are on the rise, too.

Permits for single-family homes rose to their highest levels of year in November and 89 percent of those homes will start construction within 60 days. This means that Single-Family Housing Starts should stay strong through the early part of 2012, and into the spring.

If you're planning to buy new construction in Nebraska , therefore, talk to your real estate agent soon and consider moving up your time frame. With mortgage rates low and next year's buying season approaching, you may find that the best "deals" will come within the next few weeks only.

Home Builders Experiencing Heavy Foot Traffic And Higher Sales Volume

2011-12-20T08:13:00.001-06:00

In another good sign for the housing market, today's home builders believe that the housing market has turned a corner.

For the third straight month, the Housing Market Index -- a home builder confidence survey from the National Association of Homebuilders -- reported strong monthly gains.

December's Housing Market Index climbed 2 points to 21 in December after a downward revision to last month's results. The index is now up seven points since September 2011, and sits at a 19-month high.

When home builder confidence reads 50 or better, it reflects favorable conditions in the single-family new home market. Readings below 50 reflect unfavorable conditions.

The Housing Market Index has not crossed 50 since April 2006.

The HMI itself is actually a composite reading; the result of three related home builder surveys. The National Association of Homebuilders asks its members about their current single-family home sales volume; their projected single-family home sales volume for the next 6 months; and their current buyer "foot traffic".

The results are compiled into the single Housing Market Index tally.

In December, builder survey responses showed strength across all 3 questions :

Current Single-Family Sales : 22 (+2 from November)
Projected Single-Family Sales : 26 (+1 from November)
Buyer Foot Traffic : 18 (+3 from November)

These results support the recent New Home Sales and Housing Starts data, both of which show an increase in single-family sales, and a decrease in new home housing supply.

When demand rises and supplies fall, home prices climb.

It's also noteworthy that the Housing Market Index put buyer foot traffic at newly-built homes at its highest level since May 2008. With even more buyers expected to enter the market, new home prices are expected to rise across Omaha in 2012 -- especially in the face of shrinking home supplies.

For now, though, with home prices stable and mortgage rates low, buyers can grab "a deal". 60 days forward, though, may be too late.

The Spring Buying Season unofficially starts February 6, 2012.

How To Keep Your Dishwasher Mold- and Mildew-Free

2011-12-19T07:50:00.001-06:00

Your dishwasher is a breeding ground for mold and mildew. It's warm, it's dark, and there is a bevy of decaying, organic material in the form of both food particles and soap.

Therefore, you'll want to periodically scrub and disinfect your dishwasher so that it remains it clean and healthy, and so that your dishes stay that way, too.

Here's how to clean your dishwasher :

Remove all racks from the dishwasher. Wash with dish-washing detergent and set aside to dry.
Mix 1 part vinegar with 4 parts very hot water into a spray bottle.
Spray the mixture on the dishwasher seal and anywhere else you see discoloration, mold or mildew.
Scrub the affected areas with a non-abrasive scrub brush.
Replace racks in the dishwasher.
Fill a small, dishwasher-safe bowl with white vinegar and place on the top rack.
Without soap, run the dishwasher at the highest temperature setting available.

Then, after performing these steps, you find that your dishwasher still has an "odor", or if mold or mildew remnants remain, immediately pour 1 cup of baking soda on the floor of your dishwasher, and run the cycle a second time at the highest temperature setting available.

If your mold/mildew problem persists, you should check the dishwasher's drain line. If it's kinked, water may be unable to drain and will pool at the bottom of your dishwasher -- a mold-breeding situation.

You should also check the food trap at the base of the dishwasher for too-large-to-drain pieces of food.

A good dishwasher will last years with proper care and maintenance. Keep yours mold- and mildew-free.

Mortgage Payments Fall 12% Since February 2011

2011-12-16T08:07:00.001-06:00

As mortgage rates drop, so do housing payments. It's a good time to consider refinancing your home, or making an offer on a new one. Mortgage payment affordability has never been so high in history.

According to Freddie Mac, the average 30-year fixed rate mortgage rate is now 3.94 percent -- an all-time low -- with an accompanying 0.8 discount points. This means that in order to get access to the 3.94 percent rate, Papillion homeowners and home buyers should expect to pay a loan fee equal to 0.8% of the borrowed amount, plus "normal" closing costs.

Last week, the average 30-year fixed rate mortgage rate was 3.99 percent with an accompanying 0.7 discount points.

Mortgage rates in Nebraska have been in decline for most of the year. Since peaking in early-February, the average home owner's principal + interest payment on a 30-year fixed rate mortgage had now dropped by 12.2 percent.

Here is how mortgage payments compare, then and now, not accounting for your individual tax-and-insurance escrow :

February 10, 2011 : Payment of $539.88 per $100,000 borrowed
December 15, 2011 : Payment of $473.96 per $100,000 borrowed

For existing homeowners, the dramatic drop in payments is reason to reach out to your loan officer. A refinance could save you tens of thousands of dollars over the life of your loan -- especially if you chose to refinance your mortgage into a 15-year program.

The 15-year mortgage, says Freddie Mac, is also at an all-time low, registering 3.21 percent with 0.8 discount points, on average.

For home buyers, today's low rates present an interesting opportunity.

Mortgage rates are the key factor in determining your monthly housing payment so, with average mortgage rates below 4 percent, it's no wonder home affordability is cresting. However, the housing market is showing signs of recovery. Home supplies are dwindling, buyer demand is rising, and the economy appears to be mending.

Home prices are expected to rise in 2012 and, as they do, they'll take housing payments with them. The best time to buy a home may be now; before the recovery completes.

Bank Repossessions Drop To A 44-Month Low

2011-12-15T08:09:00.001-06:00

Foreclosure activity continues to concentrate over just a few states.

According to foreclosure-tracker RealtyTrac, November's foreclosure filings fell 3 percent as compared to October, and 14 percent from November 2010.

"Foreclosure filing" is a catch-all term for the various "action steps" throughout the foreclosure process. The grouping comprises default notices, scheduled home auctions, and bank repossessions.

As in most months, though, foreclosure activity remains concentrated by state. More than half of last month's bank repossessions can be traced to just 6 states.

California : 14.8% of all bank repossessions
Florida : 12.7% of all bank repossessions
Texas : 7.0% of all bank repossessions
Georgia : 6.9% of all bank repossessions
Arizona : 6.7% of all bank repossessions
Michigan : 6.3% of all bank repossessions

Meanwhile, with just 5 repossessions, South Dakota topped the list of states with the fewest bank repossessions in November. The Mount Rushmore State accounted for just 0.009% of REO nationwide in a month in which bank repossessions dropped to a 44-month low point across the United States.

The drop in REO is coming at a tough time for today's Papillion home buyers. Distressed properties are in high demand -- mostly because they sell at steep discounts.

According to the National Association of REALTORS®, distressed homes accounted for 28 percent of all home sales in October. As fewer bank-owned homes become available, though, there will be fewer "deals" to be had.

Especially as the broader housing market continues to signal its recovery.

If you plan to buy a bank-owned foreclosed property, do your research first. As supplies drop, the price for foreclosed homes throughout Nebraska relative to non-distressed homes may rise, rendering REO properties less of a relative "value".

Before you write a contract, therefore, talk with a licensed real estate agent. There's plenty of foreclosure data available online but, when it's time to buy, you should have an experienced agent on your side.

A Simple Explanation Of The Federal Reserve Statement (December 13, 2011 Edition)

2011-12-13T13:58:00.001-06:00

Tuesday, the Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The vote was nearly unanimous for the second straight month. Just one FOMC member dissented in the vote, favoring additional policy stimulus beyond what the Federal Reserve currently provides.

In its press release, the Federal Reserve sais that the the U.S. economy is improving, noting that since its November 2011 meeting, the economy has been "expanding moderately". The Fed also added that domestic growth is occurring despite some "apparent slowing in global growth" -- a nod to ongoing uncertainty within the Eurozone.

The Federal Reserve expects a moderate pace of growth over the next few quarters, and believes that the jobs market will continue to improve, but slowly.

Other potential soft spots within the economy include :

A slowdown in business investment
A "depressed" housing market
Strains in global financial markets

The Federal Reserve added no new policies at its December meeting, and made no changes to existing ones. It re-iterated its plan to leave the Fed Funds Rate within its current range of 0.000-0.250 percent "at least until mid-2013" and re-affirmed "Operation Twist" -- the stimulus program through which the Fed sells Treasury securities with a maturity of 3 years or less, and uses the proceeds to buy mortgage bonds with maturity between 6 and 30 years.

Mortgage bonds are mostly unchanged since the Fed's announcement, giving mortgage rates in Elkhorn little reason to rise or fall.

Mortgage rates remain near all-time lows and, for homeowners willing to pay points + closing costs, 30-year fixed rate mortgages can be locked at less than 4 percent. If you're thinking of buying or refinancing a home, it's a good time to lock a mortgage rate.

The FOMC's next meeting will be its first scheduled meeting of the new year. The meeting is slated for January 24-25, 2012.

America's Best Places To Raise A Family, Listed By State

2011-12-13T08:12:00.001-06:00

BusinessWeek recently released its 2011 America's Best Place to Raise a Family rankings. College-town Blacksburg, Virginia took top honors, breaking a 2-year win streak for the Chicago, Illinois region.

In 2009, suburban Mount Prospect, Illinois placed first. Last year, it was Tinley Park, Illinois.

The BusinessWeek report employs data from real estate information firm Onboard Informatics to make its rankings, compiling data across categories such as education, crime, and jobs plus access to parks and affordable homes. All selections are limited by population; all selections are home to 50,000 residents or fewer. Median incomes are within 20 percent -- plus or minus -- of the state's median income levels.

BusinessWeek names one winner in each state. The winners in the 10 most populous states and their nearest "big city" are listed below

California : East San Gabriel (Los Angeles)
Texas : Wells Branch (Austin)
New York : Hampton Manor (Albany)
Florida : Niceville (Fort Walton Beach)
Illinois : Morton Grove (Chicago)
Pennsylvania : Cecil-Bishop (Pittsburgh)
Ohio : St. Henry (Dayton)
Michigan : Spring Arbor (Jackson)
Georgia : Hoschton (Atlanta)
North Carolina : Tryon (Spartanburg, SC)

The winners in all 50 states can be found on the BusinessWeek website.

Rankings like the BusinessWeek America's Best Place to Raise a Family can be useful for home buyers in Papillion , but like everything in real estate, statistics do not apply to every home equally. Even within the "best towns", there are areas in which school systems are better, crime figures are lower, and amenities are more plentiful.

Therefore, before you make the decision to buy a home, talk with a real estate agent who has local market knowledge. It's the most effective means to get data that matters to you.

How To Clean A Cutting Board

2011-12-12T07:49:00.001-06:00

Germ studies show that a kitchen cutting board carries up to 200 times more bacteria than a toilet seat.

This is because homeowners clean their bathrooms with fervor, while only "rinsing" down parts of their kitchens.

In failing to disinfect cutting boards (among other kitchen mainstays), homeowners in Papillion and everywhere else leave untouched a prime bacteria breeding ground, and may be getting sick as a result.

According to the CDC, 48 million Americans get sick from food-borne bacteria each year.

If it's been a while since you've cleaned your kitchen cutting board, here are some tips on how to do it properly.

Homeowners with plastic cutting boards will have an easier go that homeowners with wooden cutting boards. If your cutting board is plastic, just place it in the dishwasher with dishwasher detergent. If your dishwasher has a "sanitize" feature, be sure to select it.

If your cutting board is made of wood, or another material that may crack and/or splinter in a dishwasher, follow these steps instead :

Prepare a solution of natural dish soap and hot water.
Without submerging the cutting board, scrub it with the solution.
Towel dry the board and allow it to air-dry until completely dry.
Apply a thin layer of undistilled white vinegar to the board surface either by spray can or paper towel.
Allow the vinegar to sit for 30 minutes, then wipe clean.

For preventative care, you should also consider using separate cutting boards for meats and for fruits and vegetables. This can prevent cross-contamination. In addition, purchase a food-grade mineral oil and apply it to your wooden cutting boards regularly.

The kitchen is among the "germiest" places in your home. With extra attention, though, you can help keep it as bacteria-free as possible

Reduce Long-Term Loan Costs With A 15-Year Fixed Rate Mortgage

2011-12-09T08:42:00.001-06:00

For as low as 30-year fixed rate mortgage rates are in Nebraska today, 15-year fixed rate mortgage rates are even lower.

According to Freddie Mac's weekly mortgage rate survey, the average 15-year fixed rate mortgage rate is now 3.27% nationwide with an accompanying 0.8 discount points. 1 discount point is a closing cost equal to 1 percent of your loan size.

The current 15-year fixed rate reading is just one tick above the all-time, 15-year fixed rate mortgage low of 3.26% set in October 2011.

If you've ever thought of "going 15", it's a terrific time to talk to your lender.

The primary benefit of using a 15-year fixed rate mortgage as opposed to a 30-year fixed rate one is that a 15-year fixed rate mortgage dramatically cuts the long-term interest costs of your loan. The downside is that monthly payments are relatively large.

At today's mortgage rates, per $100,000 borrowed :

15-year fixed rate mortgage : $704 principal + interest monthly
30-year fixed rate mortgage : $477 principal + interest monthly

So, for homeowners opting for a 15-year fixed rate mortgage, the monthly principal + interest payments will be 48% higher as compared to a 30-year fixed rate mortgage of the same loan size. Long-term, however, because the 15-year fixed rate mortgage interest rate is lower and because it pays off in half the time of a 30-year loan, a homeowner will save $45,000 in interest costs per $100,000 borrowed.

$45,000 per $100,000 borrowed is a huge amount of savings. It's monies that can be used for college tuition, home improvement projects, retirement savings, or anything else.

That said, the 15-year fixed rate mortgage is not ideal for everyone.

Because it requires higher monthly payments, a 15-year fixed rate mortgage may add stress to your household budget. Furthermore, once you commit to a 15-year loan term with your lender, you can't revert back to a 30-year loan term without a refinance and refinances can be costly.

Therefore, be sure of yourself when selecting a 15-year fixed rate loan. The rewards are great, but the risks can be, too.

Reduce Long-Term Loan Costs With A 15-Year Fixed Rate Mortgage

2011-12-09T08:08:00.001-06:00

For as low as 30-year fixed rate mortgage rates are in Nebraska today, 15-year fixed rate mortgage rates are even lower.

The current 15-year fixed rate reading is just one tick above the all-time, 15-year fixed rate mortgage low of 3.26% set in October 2011.

If you've ever thought of "going 15", it's a terrific time to talk to your lender.

At today's mortgage rates, per $100,000 borrowed :

15-year fixed rate mortgage : $704 principal + interest monthly
30-year fixed rate mortgage : $477 principal + interest monthly

$45,000 per $100,000 borrowed is a huge amount of savings. It's monies that can be used for college tuition, home improvement projects, retirement savings, or anything else.

That said, the 15-year fixed rate mortgage is not ideal for everyone.

Therefore, be sure of yourself when selecting a 15-year fixed rate loan. The rewards are great, but the risks can be, too.

Simple Real Estate Definitions : Tax And Insurance Escrow

2011-12-08T08:05:00.001-06:00

As a homeowner in Elkhorn , your fiscal responsibility extends beyond just making mortgage payments. You must also pay your home's real estate taxes as they come due, as well as your homeowners insurance policy premiums.

Failure to pay real estate taxes can result in foreclosure. Failure to insure your home is a breach of your mortgage loan terms.

There are two methods by which you can pay your real estate tax and homeowners insurance bills.

The first method is to pay your taxes and insurance as the bills come due, usually semi-annually. Depending on your home's tax bill size and the cost to insure your home, these payments can feel quite large -- especially if you've failed to budget for them properly.

The second method of paying your taxes and insurance is to give your lender the right to pay them on your behalf, a process known as "escrowing for taxes and insurance".

When you escrow your real estate taxes and homeowners insurance, you pay a portion of your annual obligation to your lender each month, which your lender then holds in a special account for you, and disperses to your taxing entities and insurance company as needed. Lenders prefer that homeowners escrow taxes and insurance because, in doing so, the lender is assured that tax bills remain current and that homes stay insured.

Want a discount on your next mortgage rate? Tell your lender that you're willing to escrow.

To help calculate your monthly escrow payment to your lender, do the following :

Find your home's annual real estate tax bill
Find your home's annual homeowners insurance premium
Add the two figures and divide by 12 months in a year

The quotient is your monthly "escrow"; the extra payment you'll make to your lender each month along with your regularly scheduled principal + interest payment. Then, when your tax bills and insurance premiums come due, your lender will make sure the payments are made on your behalf.

If you're unsure whether escrowing is right for you, talk to your loan officer and/or financial planner. There are valid reasons to choose either path.

Have Mortgage Rates Bottomed Out?

2011-12-07T08:07:00.001-06:00

Mortgage rates have troughed. Or, so it seems.

According to Freddie Mac's weekly Primary Mortgage Market Survey, the average 30-year fixed rate mortgage is 4.00 percent nationwide -- roughly the same rate as it's been for 5 weeks.

During that times, rates have ranged between 3.97 and 4.02 percent with an accompanying 0.7 discount points, plus "typical" closing costs. Closing costs vary by state and 1 discount point is equal to 1 percent of your loan size.

In other words, to get the weekly, published Freddie Mac rate, borrowers in Nebraska should expect to pay a complete set of fees to their respective lenders. The larger the loan, the higher the costs. "Low-fee" and "no-fee" loans are available, too -- typically in exchange for a slightly rate.

A breakdown of the Freddie Mac survey shows that interest rates and discount points vary by region. Typically, states in the West Region offer the lowest rates but with the highest costs. East Region states work in reverse; rates are often highest but the accompanying points are fewest.

The most recent mortgage rate breakdown by region shows :

Northeast Region : 4.00% with 0.7 discount points
West Region : 3.96% with 0.8 discount points
Southeast Region : 4.06% with 0.9 discount points
North Central Region : 3.97% with 0.7 discount points
Southwest Region : 4.04% with 0.7 discount points

What's most notable, though, is that in all 4 regions, rates are well below their 2011 highs. Since mid-April, mortgage rates have been in descent, dropping for 5 consecutive months before reaching to their current, "rock-bottom" levels in early-November.

Since then, however, rates have idled and the forces that combined to make rates low throughout Omaha are subsiding. The U.S. economy is showing signs of a rebirth; the Eurozone is edging closer to solvency; and the housing market is recovering.

So, if you've been wondering whether now is a good time to refinance, or whether higher rates will harm home affordability, the answer is yes. Get in touch with your loan officer to review your home loan options because, looking ahead to 2012, mortgage rates look poised to rise.

Fed Minutes Suggest New Economic Stimulus Next Week

2011-12-06T08:04:00.001-06:00

The Federal Open Market Committee released its November 2011 meeting minutes, revealing a Fed split on whether new stimulus is needed for the U.S. economy.

The Fed Minutes is published 8 times annually, three weeks after each scheduled Federal Open Market Committee meeting. It's the official record of the meeting's policy-shaping debates and dialogues.

The Fed Minutes is the lengthier companion piece to the FOMC's more well-known, post-meeting press release.

As compared to press release which is concise and focused at 492 words, the Fed Minutes is comprehensive and broad, totalling 7,682 words over 11 pages, complete with charts.

The November minutes reveal Fed opinions on a variety of economic issues :

On employment : Unemployment will gradually decline through 2014
On housing : The market remains depressed. Foreclosures are "holding back" growth.
On rates : The Fed Funds Rate should remain low until mid-2013

There was also discussion about the government's revamped HARP program, and how it should help more homeowners get access to low mortgage rates. The Fed sees this as a positive for housing, and for the economy.

There was little in November's Fed Minutes to surprise Wall Street, however, the Fed did discuss the possibility of new market stimulus, a topic Wall Street expects the FOMC to address next week at its last scheduled meeting of 2011.

Should the Fed introduce new market stimulus next week, and should it arrive in the form of additional mortgage bond purchases, expect for mortgage rates to fall across Nebraska and nationwide. If the Fed declines new stimulus, mortgage rates should rise.

The FOMC meets Tuesday, December 13, 2012.

How To Install A Dimmer Switch

2011-12-05T07:52:00.001-06:00

A Omaha home's lighting accounts for 15 percent of its total energy consumption, a fact that's both costly to homeowners, and "un-green" to the environment. It's simple to reduce those effects, however -- all you need are dimmer switches.

A modern dimmer switch works by rapidly opening and closing a light circuit, providing less energy to the bulb, and consuming less energy from the source.

In this 2-minute video, you'll learn how to reduce your home's standard on/off lighting switches using dimmer switches. The dimmer-switch project is a do-it-yourself project and requires only basic handyman experience.

First, determine whether you need a 3-way dimmer switch, or a single-pole dimmer switch. If your fixture is controlled my two light switches, you'll want a 3-way dimmer switch. Otherwise, the single-pole choice is best.

Next, just follow the directions :

Cut the power to the light switch via your home's circuit breaker
Remove the existing light switch plate and pull the switch from the wall
Disconnect the in-wall wires from the existing light switch plate
Connect the in-wall wires to their same-color wires on the dimmer switch plate
Push the wires into the wall and reconnect the power via the circuit breaker

The amount of energy that dimmer switches will save your home depends on light-types and to what degree you use the switch's dimmer capabilities. One caveat, though -- not all energy-saving light bulbs are dimmer switch-capatable.

Compact fluorescent light bulbs, for example, don't work with dimmer switches unless the bulb is specifically designed to be "dimmable".

The rooms with highest wattage rates are typically the master bathroom and the kitchen.

More Housing Strength : Pending Home Sales Surged In October

2011-12-02T08:06:00.001-06:00

If you're waiting for home prices to reach its bottom, you may have missed your window.

After 3 consecutive months of easing, the Pending Home Sales Index jumped 10 percent in October, lending credence to the belief that housing is in recovery.

The Pending Home Sales Index is a monthly publication from the National Association of REALTORS®. It measures the number of homes under contract to sell nationwide. October's reading is the highest for all of 2011, and the second-highest dating back to April 2010.

April 2010 was the last month of the last year's federal home buyer tax credit.

For buyers and sellers in Omaha and nationwide, the Pending Home Sales Index is a housing metric worth watching. Different from the Existing Home Sales and New Home Sales reports which report on "the past", the Pending Home Sales Index is a forward-looking housing market indicator.

According to the National Association of REALTORS®, 80% of homes under contract close within 2 months.

The majority of the rest close within Months 3 and 4.

The spike in October's Pending Home Sales Index, therefore, foretells a strong Existing Home Sales report for November and December. Not that we should be surprised! Home builders have been telling us for weeks that the market is strengthening, and that home supplies are at multi-year lows.

The only wild-card is the market's out-sized contract failure rate. One in three pending home sales failed to close in October -- nearly double the rate of the month prior and 4 times the rate of October 2010. Should this high failure rate continue, the Pending Home Sales Index's role as a forward-looking indicator would be muted.

Overall, though, new buyer demand for housing accompanied a smaller home supply will result in higher home prices through 2012. And, with mortgage rates expected to rise, monthly carrying costs will be higher, too.

Looking at the data, the best time to buy a home may be right now.

Friday's Jobs Report Represents A Big Risk To Low Mortgage Rates

2011-12-01T09:15:00.001-06:00

Have you been floating a mortgage rate? It may be time to lock.

At 8:30 AM ET Friday, the government's Bureau of Labor Statistics will release its November Non-Farm Payrolls report. Better known as "the jobs report", the monthly Non-Farm Payrolls figures provide sector-by-sector employment data, and tally the size of the current U.S. workforce size.

From these two elements, the national Unemployment Rate is derived.

Since topping out at 10.2% in October 2009, the Unemployment Rate has dropped to 9.0%. More than 2.3 million net new jobs have been made in the last 24 months.

Wall Street expect to see 125,000 more jobs added in November.

Depending on how closely the actual Non-Farm Payrolls data meets Wall Street expectations, Papillion rate shoppers could find that the mortgage market landscape has shifted beneath them. The jobs report is a mortgage-market catalyst and when its reported value differs from Wall Street expectations, the impact on mortgage rates can be palpable -- especially in a recovering economy.

The connection between the jobs market and the mortgage market is straight-forward -- as the jobs market goes, so goes the economy.

When more people work, consumer spending increases
When consumer spending rises, businesses expand and invest
When businesses expand and invest, more people are put to work

Furthermore, employees and employers both pay taxes to governments. With more tax revenue, governments embark upon new projects which (1) require the hiring of additional workers, and (2) require the purchase and/or repair of additional equipment and supplies.

Employment can be a self-reinforcing cycle for the economy and that's why Friday's jobs report will be so closely watched. If the number of jobs created exceeds the 125,000 expected, mortgage rates will rise on the expectation for a stronger U.S. economy in 2012.

Conversely, if the jobs figures fall short, mortgage rates may fall.

Mortgage rates continue to hover near all-time lows according to Freddie Mac's weekly Primary Mortgage Market Survey. The average 30-year fixed rate mortgage is sub-4.000 percent nationwide, with an accompanying fee of 0.7 discount points. 1 discount point is equal to 1 percent of your loan size.

If you're under contract for a home or looking to refinance, minimize your interest rate risk. Lock ahead of Friday's Non-Farm Payrolls release.

Get your rate lock in today.

New Home Supplies Fall To An 18-Month Low

2011-11-29T08:12:00.001-06:00

If you plan to buy of new construction in Nebraska sometime in 2012, don't expect today's low prices. Like everything in housing of late, the market for newly-built homes appears to be stabilizing and, in some markets, improving.

As foreshadowed by this month's strong Homebuilder Confidence survey, the Census Bureau reports that the number of new homes sold rose to a 6-month high in October, climbing to 307,000 units on a seasonally-adjusted, annualized basis.

A "new home" is a home that is considered new construction. It's the opposite of an "existing home".

Home buyers are comparing new construction to home resales and liking what they see. At the current sales pace, the nation's complete new home inventory would now be depleted in just 6.3 months. This marks the lowest home supply since April 2010 -- the last month of the last year's federal homebuyer tax credit.

By building only to meet new demand, builders are keeping home supplies in check, and home prices stable. They've also found a niche market -- 80% of homes sold last month sold for less than $300,000.

Split by region, the Census Bureau reports October's New Home Sales as follows :

Northeast Region : +0.0% from September 2011
Midwest Region : +22.2% from September 2011
South Region : -9.5% from September 2011
West Region : -14.9% from September 2011

Unfortunately, the data may be incorrect.

Although the October New Home Sales report says that sales climbed 1.3 percent last month, the government's data was published with a ±19.7% margin of error. This means that the actual New Home Sales reading may have been as high as +21.0 percent, or as low as -18.4 percent. Because the range of values includes both positive and negative values, the Census Bureau assigned its October data "zero confidence".

As home buyers, then, we can't take our market cues from the published data. Instead, we should look to other metrics including Housing Starts data and the aforementioned homebuilder confidence survey. Each points to strength in the new home market, and foretells higher home prices in 2012.

If you're in the market for new construction, consider writing an offer soon. Home prices remain low and mortgage rates do, too -- a combination that keeps home payments low. Next year, that may not be the case.

Home Improvement Projects : How Much Equity Will You Build?

2011-11-28T07:51:00.001-06:00

Home improvement projects are booming, expected to cross $110 billion in total volume this quarter. Unlike in recent years, however, the projects aren't helping to create much new home equity.

According to Remodeling Magazine's Cost vs Value Report 2011-2012, for each home improvement dollar spent in 2012, homeowners can expect to recoup just 58 cents in home equity.

This figure is down sharply from 2005, when the cost-to-value ratio was 87 percent.

Today's Papillion homeowners get a much smaller payoff on their home improvement projects. If you're planning to remodel/update in preparation for sale, therefore, consider the following projects, each of which carries a high cost-to-value ratio.

From Remodeling Magazine's "Mid-Range Project" list :

Steel Entry Door Replacement : Cost, $1,238; Recoup, 73.0%
Attic Bedroom : Cost, $50,184; Recoup, 72.5%
Minor Kitchen Remodel : Cost, $19,588; Recoup, 72.1%
Garage Door Replacement : Cost, $1,512; Recoup, 71.9%
Wood Deck Addition : Cost, $10,350; Recoup 70.1%

By contrast, other projects carry a low cost-to-value ratio, and should only be undertaken if the project's utility exceeds its cost. These projects don't do much to raise a home's resale value.

Home Office Remodel : Cost, $27,963; Recoup, 42.9%
Sunroom Addition : Cost, $34,133; Recoup, 45.9%
Backup Power Generator : Cost, $14,760; Recoup, 47.5%
Bathroom Addition : Cost, $140,096512; Recoup, 51.0%
Fiberglass Entry Door Replacement : Cost, $3,536; Recoup 56.3%

In the "Upscale Projects" category, projects including the replacement of doors, siding and windows occupy the list's first 6 slots in terms of cost-to-value.

If you're planning a home improvement project over the next few months, the timing is right -- both contractor costs and material costs are low nationwide, and improving a home can extend its useful life.

See the complete Cost vs Value report online.

Conforming Loan Limits Unchanged For 2012

2011-11-25T08:03:00.001-06:00

A conforming mortgage is one that, literally, conforms to the mortgage guidelines as set forth by Fannie Mae and Freddie Mac.

Conforming mortgage guidelines are Fannie's and Freddie's eligibility standards; an underwriter's series of check-boxes to determine whether a given loan should be approved.

Among the many traits of a conforming mortgage is "loan size".

Each year, the government re-assesses its maximum allowable loan size based on "typical" housing costs nationwide. Loans that fall at, or below, this amount meet conforming mortgage guidelines. Loans in excess of this limit are known as "jumbo" loans.

Between 1980 and 2006, as home values increased, conforming loan limits did, too, rising from $93,750 to $417,000. Since 2006, however, despite falling home prices in many U.S. markets, the conforming loan limit has held steady. This will remain true for 2012 as well.

In 2012, for the 7th straight year, the national, single-family conforming mortgage loan limit will remain at $417,000.

The complete 2012 conforming loan limit breakdown, by property type :

1-unit properties : $417,000
2-unit properties : $533,850
3-unit properties : $645,300
4-unit properties : $801,950

However, there are some areas nationally that have earned "loan limit exceptions" based on the local median sales prices. These areas are known as "high-cost" areas and loan limits within these regions range from $417,001 to a maximum of $625,500.

Some examples of high-cost areas include San Francisco (along with a most of California), New York City, and most of Hawaii and Alaska. Nationally, there are approximately 200 such "high-cost" areas.

Verify your local conforming loan limit and loan limits across Nebraska via the Fannie Mae website. A complete county-by-county list is published online.

More Sales, Less Inventory : Home Prices Headed Higher?

2011-11-23T08:07:00.001-06:00

The housing market continues to signal that a broad rebound is underway. In October, despite sparse home inventory, the number of properties sold increased 1.4% nationwide.

According to data from the National Association of REALTORS®, on a seasonally-adjusted, annualized basis, October Existing Home Sales gained 70,000 units as compared to September, registering 4.97 million existing homes sold overall.

An "existing home" is a home that has been previously occupied and, as compared to prior months, the stock of homes for sale is depleted.

Just 3.3 million homes were listed for sale last month. This represents a 2 percent drop from September and marks the sparsest home resale inventory of 2011.

The current home supply would last 8.0 months at today's sales pace -- the fastest rate since January 2010.

The real estate trade group's report contained other noteworthy statistics, too :

34 percent of all sales were made to first-time buyers
29 percent of all sales were made with cash
28 percent of all sales were for foreclosed homes, or short sales

It also said that one-third of transactions "failed" as a result of homes not appraising for the purchase price; failure to achieve a mortgage approval; and, insurmountable home inspection issues.

This 33% failure rate is huge as compared to September 2011 (18%) and October 2010 (8%). It underscores the importance of getting pre-qualified to purchase, and of selecting a home "in good condition".

For today's Omaha home buyer, October's Existing Home Sales may be a "buy signal". Supplies are falling and sales are increasing. Elementary economics says home prices should begin rising, if they haven't already.

Remember : The data we're seeing is already 30 days old. Today's market may be markedly improved already.

The good news is that mortgage rates remain low. Freddie Mac reports that the average 30-year fixed rate mortgage rate is 4.000% with 0.7 discount points, making homes as affordable as they've been in history.

With rising home values, you may end up paying more to purchase your new home, but at least you'll pay less to finance it.

Maximum FHA Loan Limits Restored To $729,750

2011-11-22T08:06:00.001-06:00

After a brief return to lower, pre-2009 levels, FHA loan limits have been restored. As signed into law last Friday, maximum FHA loan limits are -- once again -- as high as $729,750.

The move creates additional mortgage financing possibilities in more than 650 U.S. counties, and promises to increase the FHA's mortgage market share, which has grown from 6% in 2007 to roughly 30% today.

The change in FHA loan limits also marks the first time that FHA loan limits exceed those of conventional mortgage-backers Fannie Mae and Freddie Mac.

Conventional loans remain capped at a maximum of $625,500.

For home buyers in Papillion and nationwide, FHA-insured mortgage offer several advantages over comparable conventional loans, the most commonly cited of which is that FHA-insured loans require a down payment of just 3.5 percent.

FHA-insured mortgages carry other advantages, too, however.

First, FHA home loans are not subject to loan-level pricing adjustments (LLPA). This means that, all things equal, buyers and would-be refinancers with credit scores below 740; or, who live in multi-unit homes; or, who have high loan-to-values are not subject to additional loan fees as a conventional mortgage applicant might.

Second, after 6 months of on-time payments, FHA-backed homeowners are eligible for the FHA Streamline Refinance. The FHA Streamline Refinance is among the simplest loan products for which to qualify with no appraisal required. Even if you're "underwater" on your mortgage, you can still be streamline-eligible.

And, lastly, at least in today's market, FHA mortgage rates are below those of the conventional market.

The downside of FHA financing, however, is that all FHA mortgages require mortgage insurance and FHA mortgage rates are often higher versus a comparable conventional loan. This means that, although its mortgage rate may be lower, the payment for an FHA home loan may be higher as compared to a Fannie Mae mortgage with similar credit traits.

FHA loans aren't always optimal, but with higher FHA loan limits, expect the FHA's market share to increase.

Check your local FHA loan limit at the HUD website.

Using Home Generators? Here's How To Stay Safe.

2011-11-21T07:49:00.001-06:00

Carbon monoxide is an odorless, colorless, poisonous gas. It kills more 400 people die in their homes each year.

Carbon monoxide poisoning is especially common during periods of power outage. This is because homeowners throughout Elkhorn fire up their personal home power generators.

Home generators are a leading cause of poisoning by carbon monoxide and, in this 4-minute from NBC's The Today Show, you'll learn about home generators, how they operate, and the safety measures everyone homeowner should undertake.

A few basic home generator safety rules, as described in the interview, include :

Never modify a generator or its engine
Keep a 10-foot distance between the generator and your home
Always point the generator's exhaust away from your home

Furthermore, make sure your home has an ample supply of carbon monoxide detectors, and that they're operational.

One of the video's highlights is clever illustration employing a vase of water and a dash of red dye. The demonstration shows just how few carbon monoxide particles are required to cause injury and/or death to a person in your household.

Therefore, if you own a home generator, take 4 minutes watch this video. Safety when home generators is paramount to your health.

Housing Starts Rising; New Construction Turns The Corner?

2011-11-18T08:05:00.001-06:00

Another day, another signal that the market for newly-built homes is improving.

Single-Family Housing Starts rose to a seasonally-adjusted, annualized 430,000 units in October -- a 4 percent increase from September and the highest reading in 3 months.

A "Housing Start" is a home on which ground has been broken.

The increase in surprised Wall Street analysts, although it shouldn't have.

Earlier this week, the National Association of Homebuilders showed that Homebuilder Confidence is at its highest point since May 2010, the effect of better market conditions and more sold units. Rising housing starts amid a lift in builder confidence is to be expected -- the two metrics have moved with loose correlation since mid-2000.

However, as with everything in real estate, Single-Family Housing Starts volume varied by location. The nation's 4 regions posted wide-ranging results :

Northeast Region : + 10.0% from September
Midwest Region : -4.1% from September
South Region : +11.3% from September
West Region : -10.2% from September

Buyers of new construction in Elkhorn can infer two key points from last month's data.

First, with more homes will being built, home supply should rise, thereby softening pressure on rising home prices. This should help keep homes affordable.

However, the second point is that, with builder confidence rising, buyers are less likely to win price concessions and "free upgrades" in negotiations.

The last 6 weeks of 2011 may be your optimal time to buy new construction. Home prices remain affordable and mortgage rates are rock-bottom. In addition, because there are typically fewer active home buyers during the holidays, you'll be more likely to locate one of the few remaining new construction "deals".

Talk to your real estate agent about local trends and new construction.

Homebuilders Getting Optimistic; Higher Home Prices Ahead?

2011-11-17T08:08:00.001-06:00

Homebuilder confidence continues to rise.

Just two months after falling to a multi-month low, the Housing Market Index surged again in November, climbing another three points to 21. It's the second straight month that the HMI posted a 3-point gain, catapulting the index to an 18-month.

The Housing Market Index is monthly report from the National Association of Homebuilders. It's meant to measure confidence among the nation's homebuilders, scored on a scale of 1-100.

When homebuilder confidence reads 50 or better, it reflects favorable conditions for homebuilders. Readings below 50 reflect unfavorable conditions.

The Housing Market Index has not read north of 50 since April 2006.

As an index, the HMI is actually a composite reading; the result of three separate surveys sent to homebuilders each month. The National Association of Homebuilders asks it members about current single-family home sales volume; projected single-family home sales volume over the next 6 months; and current "foot traffic".

In November, builder responses were stronger in all 3 categories :

Current Single-Family Sales : 20 (+3 from October)
Projected Single-Family Sales : 25 (+1 from October)
Buyer Foot Traffic : 15 (+1 from October)

And, beyond the headline data, there is an important, noteworthy item in this month's Housing Market Index.

In November, "Current Single Family Sales" climbed 3 points for the second straight month, and is now at the highest point since May 2010 -- the month after last year's home buyer tax credit expired. And, this increase in sales volume is occurring as new home construction is falling, thereby reducing home inventory nationwide.

That's an important point for Elkhorn home buyers.

With more new home sales and fewer new home listings, prices are likely to increase into 2012. Especially with home builders predicting higher sales levels over the next 6 months, and seeing higher levels of buyer foot traffic through their properties today.

For now, though, home prices are stable and mortgage rates are low. This creates low-cost homeownership throughout Nebraska , and helps new home construction remain affordable.

If you're in the market for new home construction, the next 60 days may prove to be your best time to get "a deal".

Government Releases Additional HARP Guidance For Underwater Homeowners

2011-11-16T08:04:00.001-06:00

Tuesday, Fannie Mae and Freddie Mac unveiled lender instructions for the government's revamped HARP program, kick-starting a potential refinance frenzy across Nebraska and nationwide.

HARP stands for Home Affordable Refinance Program. The updated program is meant to give "underwater homeowners" an opportunity to refinance at today's low mortgage rates.

In the two-plus years since its launch, HARP's first iteration helped fewer than 900,000 homeowners. HARP II, by contrast, is expected to reach millions.

Lenders begin taking HARP II loan applications December 1, 2011.

To apply for HARP, applicants must first meet 4 basic criteria :

The existing mortgage must be guaranteed by Fannie Mae or by Freddie Mac
The existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior to June 1, 2009
The mortgage payment history must be perfect going back 6 months
The mortgage payment history may not include more than one 30-day late payment going back 12 months

If the above criteria are met, HARP applicants will like what they see.

For HARP applicants, loan-level pricing adjustments are waived in full for loans with terms of 20 years or fewer; and maxed at 0.75 for loans with terms in excess of 20 years.

This will result in dramatically lower mortgages rates for HARP applicants -- especially those with credit scores below 740. Some applicants will find HARP mortgage rates lower than for a "traditional" conventional mortgage.

In addition, HARP applicants are exempted from the standard waiting period following a bankruptcy or foreclosure, which is 4 years and 7 years, respectively.

These two items are inclusionary and should help HARP reach a broader U.S. audience.

HARP contains exclusionary policies, too.

The "unlimited LTV" feature only applies to fixed rate loans or 30 years or fewer. ARMs are capped at 105% loan-to-value.
Applicants must be "requalified" if the proposed mortgage payment exceeds the current payment by 20%.
Applicants must benefit from either a lower payment, or a "more stable" product to qualify

And, of course, HARP can only be used once.

Fannie Mae and Freddie Mac will adopt slight variations of the same HARP guidelines so make sure to check with your loan officer for the complete list of HARP eligibility requirements.

Foreclosure Filings Climbing; 4 States Account For Half Of Nationwide Activity

2011-11-15T08:06:00.001-06:00

Foreclosed homes are a hot market throughout Nebraska -- and supplies are ramping up.

According to foreclosure-tracking firm RealtyTrac, October's foreclosure filings rose 7 percent to 231,000 filings nationwide.

A "foreclosure filing" is any one of the following foreclosure-related events : A default notice on a home; a scheduled auction for a home; or, a bank repossession of a home. Because of this definition, a single home can account for up to 3 foreclosure filings -- one from each category.

Because of this, we may glean more relevant insight into the foreclosure market by separating RealtyTrac's foreclosure report into "event types".

Default Notices : Up 10% from September 2011; Down 31% from October 2010.
Scheduled Auctions : Up 8% from September 2011; Down 38% from October 2010.
Bank Repossessions : Up 4% from September 2011; Down 27% from October 2010.

These breakdowns suggest that, although improved as compared to last year, the foreclosure market is growing. At least, it's growing in some parts of the country. We can't forget that -- like everything real estate -- foreclosures are a local phenomenon.

In October, just 4 states accounted for more than half of the country's foreclosure filings. Those four states -- California, Florida, Michigan and Illinois -- represent just 26% of the U.S. population.

Even on a per household basis, the figures remain disproportionate :

Top 10 Foreclosure States : 1 foreclosure per 341 households, on average
Bottom 10 Foreclosure States : 1 foreclosure per 7,434 households, on average

The nationwide foreclosure rate was 1 foreclosure per 563 households.

As a Elkhorn home buyer, foreclosures are worth watching. They account for 18% of home resales nationwide and, in some markets, can be bought at steep discounts versus a comparable "non-distressed" home. That is part of their appeal, in fact.

But just because foreclosed properties can be a "deal", it doesn't mean you should rush to buy one. Buying a foreclosed home from a bank is different from buying a non-foreclosed home from a "person". The contracts and negotiation process are different, and foreclosed homes are sometimes sold as-is.

"As-is" means "this home may have defects".

Therefore, if you plan to buy a foreclosed home, talk with a real estate professional first. You can learn a lot about the housing market online, but with respect to writing an offer on a property, you'll want an experienced agent on your side.

Using Space Heaters? Use This Safety Advice.

2011-11-14T08:09:00.001-06:00

Space heaters are popular among homeowners in Papillion because, as portable appliances, they can heat a small space quickly and inexpensively. It requires less energy to run a space heater than to raise the temperature of an entire home by a few degrees.

However, space heaters can be dangerous, too.

In its November 2011 report, the National Fire Protection Association reveals that heating equipment was involved in an estimated 58,900 home structure fires, 480 civilian deaths, 1,520 civilian injuries and more than $1.1 billion in damage.

Space heaters caused a disproportionate percentage of the accidents :

79% of all home heating-related civilian deaths
66% of all home heating-related civilian injuries
52% of all home heating-related property damage

If you use space heaters, therefore, please remember to read (and follow) the manufacturer's instructions for proper usage, and to obey basic safety standards.

First, never place anything flammable within three feet of a space heater. Space heaters get very hot, very quickly and can ignite rugs, paper and curtains.

Next, make sure your space heater is placed on the floor, on level ground. Do not rest it on books, or on furniture.

Also, make sure to turn space heaters off when leaving a room, or when going to bed. Space heaters are not meant to replace whole-home heating and should not be left unattended under any circumstance.

The Underwriters Laboratory makes a list of general safety tips available on its website. Considering how much damage space heaters can cause, the list is worth committing to memory.

This Holiday Season, Think Twice Before Saving 15 Percent At The Register

2011-11-09T08:08:00.001-06:00

With Halloween behind us, retailers are in the Holiday Spirit. Businesses know that consumers spent a median $556 on holiday gifts last year and they want this year to be just as strong.

That's why it's barely November and, already, Black Friday ads clog our mailboxes and the airwaves. Retailers want our dollars and they're offering great deals to early shoppers.

There's one discount a smart shopper should think twice, however -- the ever-present "Open A Charge Card Today And Save 15%" promotion. In the short-term, deals like this will save money.

Over the long-term, however, opening a charge card could cost you much, much more -- especially if you plan to refinance your home or buy a new one.

Applying for a charge card can lower your credit score up to 85 points.

According to the myFICO.com website, as a category, "New Credit" accounts for 10% of your 850 possible credit points, comprising the following credit traits :

Your number of recently opened accounts
Your number of recent credit inquiries
Time elapsed since your recent credit inquiries
Your proportion of new accounts to all accounts

Each trait is a negative in the FICO-scoring credit algorithm which means that, with each in-store charge card application, your credit score is likely to fall. How far your score will fall depends on the rest of your credit profile.

Meanwhile, low FICO scores correlate to higher loan fees.

Using a real-life example, assuming 20% equity in a home, for either purchase or refinance, look how loan fees for a $200,000 conforming mortgage change by FICO score :

740 FICO : There will be no added loan costs
720 FICO : You'll have a 0.250% increase in loan costs, or $500
700 FICO : You'll have a 0.750% increase in loan costs, or $1,500
680 FICO : You'll have a 1.500% increase in loan costs, or $3,000
660 FICO : You'll have a 2.500% increase in loan costs, or $5,000

You can see first-hand how expensive low credit score can be -- much more costly than the 15% saved at the mall. That's why people planning to refinance to today's low rates and soon-to-be Papillion homeowners, shouldn't rush to save 15% at the register.

For people in want of a mortgage, high FICO scores are worth protecting.

Tips For Maximizing Your Home's Appraised Value

2011-11-08T08:13:00.001-06:00

A home appraisal is an independent opinion of your home's value, performed by a licensed home appraiser. Appraisals are part of the traditional home purchase process, and lenders require them for most refinances, too.

Appraisers are trained professionals. First, they derive a base for your home's value based on the recent sales prices of homes that are comparable to yours in terms of bedrooms, bathrooms, style, and square footage.

Then, accounting for features and amenities that make your home different, the appraiser applies "adjustments" to that base value.

This methodology is called the "Sales Comparison" approach and the result is your home's appraised value.

It's the most common appraisal method used by lenders.

As a homeowner in Omaha , you can't affect the sales prices of your home's comparable properties, but you can help your appraiser understand how your home stands apart from these homes. This, in turn, can affect your home's adjustments, resulting in a higher appraised value.

With home appraisals, every valuation dollar can matter. With that in mind, here are a few tips for maximizing your home's appraised value :

Be home for your appraisal so you can answer the appraiser's question, if there are any.
Mention any new roofing, flooring, HVAC, plumbing, or windows you've installed since purchase.
Don't mention projects or repairs you're "about to undertake". Appraisers don't credit for unfinished projects.
Make minor household fixes prior to the appraisal (e.g.; leaky sink, running toilet, peeling paint).
Present a tidy home. This can contribute to a higher "overall condition" adjustment.

Lastly, schedule the appraisal for a time that is convenient for your entire household. An appraiser needs to see, measure, and take photos of every room in your home. If a room's door is closed because of a resting child, for example, the appraiser may need to schedule a second appointment to complete the appraisal, and that can raise your appraisal costs.

Your Home Has A Smoke Detector. Are You Sure It's Really Working?

2011-11-07T08:05:00.001-06:00

An estimated 356,000 in-home fires caused more than $7 billion in U.S. residential property damage in 2009, according to data from the United States Fire Administration.

The fires caused more than 12,000 injuries, and killed more than 2,500 people in Papillion and nationwide.

Unfortunately, many of affected homes did have smoke detectors -- they just weren't working properly. This is why it's critically important to test your home's smoke detectors at least once annually.

When you test a smoke detector, you're making sure that the alarm will trigger in the event of a real-life fire. A proper test will confirm that the batteries have useful life, and that the device's smoke detection components are operating as expected.

To test your smoke detector, here's what to do :

Make a checklist of your home's smoke detectors
Go to the first smoke detector
Ask a helper to go to the farthest point from the detector within your home
Press the smoke detector's testing button up to 10 seconds to activate the alarm
Confirm with your helper that the alarm could be heard from his/her location
Note on the checklist whether the smoke detector worked, or needs replacement

You can also take your test a step further.

Just because the smoke detector's alarm can be heard from the farthest point in your house doesn't mean that the alarm will sound in the event of a real fire. Therefore, you may want to buy a "smoke test".

Smoke tests are aerosol cans that simulate a bona fide in-home fire. You can buy them for less than $15 at your local hardware store, or at Amazon.com. If your smoke detector fails to sound its alarm in the presence of a "real fire", make sure you replace it right away.

The Most Expensive ZIP Codes In The Country (2011 Edition)

2011-11-04T08:09:00.001-05:00

In the housing market, amenities and location have as much to do with a home's value as the everyday forces of supply-and-demand. Whereas the latter causes home values to rise and fall over time, the former creates a starting point for said values.

Where you live -- and the features of your home -- determine your home's price range. Naturally, homes in some areas are consistently higher-valued than homes in others.

Using data compiled by real estate market data firm Altos Research, Forbes Magazine presents America's 10 most expensive ZIP codes. California and the New York Metro area dominate the list.

Alpine, NJ (07620) : $4,550,000
Atherton, CA (94027) : $4,295,000
Sagaponack, NY (11962) : $3.595,000
Hillsborough, CA (94010) : $3,499,000
Beverly Hills, CA (90210) : $3,469,891
New York, NY (10012) : $3,392,574
New York, NY (10013) : $3,317,962
Water Mill, NY (11976) : $3,300,000
Montecito, CA (93108) : $3,099,348
Old Westbury, NY (11568) : $3,095,000

In fact, of the top 50 most expensive ZIP codes, only 6 are located outside of California and New York regions. 3 are Colorado resort towns -- Snowmass (81654), Aspen (81611) and Telluride (81435) -- one is in Maryland, one is in Florida, and the last is in Washington State.

Chicago-suburb Kenilworth (60043) is the top-ranked Midwest ZIP code. It placed 86th overall.

The Forbes list may be interesting but, to home buyers or sellers in Elkhorn , it should not be the final word in home values. Real estate is a local market which means that -- even within a given ZIP code -- prices can vary based on street and neighborhood.

Look past general data and get specific. Talk to your real estate agent for local market pricing.

A Simple Explanation Of The Federal Reserve Statement (November 2, 2011 Edition)

2011-11-02T12:38:00.001-05:00

Wednesday, the Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The vote was nearly unanimous, with just one dissenting voter. There were 3 dissenters at each of the FOMC's last two meetings.

In its press release, the Federal Reserve presented an improved outlook for the U.S. economy, noting that since its last meeting in September, there's new evidence that the economy "strengthened somewhat" in the third quarter.

One example cited is that consumer and business spending continues to rise while inflationary pressures on the economy remain modest. This indicates controlled growth -- a plus in a recovering economy.

The economy remains slowed by a number of factors, though, as noted by the Fed :

"Continuing weakness" in the labor market
Softness in commercial real estate
A "depressed" housing market

In response to mixed economic conditions, the FOMC opted to "do nothing" today; it introduced no new monetary policy, and revised none of its existing market stimulus. The Fed re-iterated its plan to leave the Fed Funds Rate in its current range near 0.000 percent "at least until mid-2013″ and affirmed "Operation Twist" -- the program in which the Fed sells Treasury securities with a maturity of 3 years or less, and uses the proceeds to buy mortgage bonds with maturity between 6 and 30 years.

Mortgage market reaction to the FOMC statement has been negative this afternoon. Mortgage rates throughout Nebraska are rising because analysts expected the Fed to launch new, bigger stimulus plans. It didn't. Rates may drift higher for the new few days, too.

Therefore, it today's mortgage rates fit your household budget, consider locking in a mortgage rate. Mortgage rates are very low right now, relative to history. It may not last.

The FOMC's next meeting -- its last scheduled meeting of the year -- is December 13, 2011.

More Risk To Home Affordability : Friday's Jobs Report

2011-11-02T08:07:00.001-05:00

Within the next 48 hours, mortgage rates may get bouncy. The Federal Open Market Committee will adjourn from a 2-day meeting and October's Non-Farm Payrolls report is due for release.

Of the two market movers, it's the Non-Farm Payrolls report that may cause the most damage. Rate shoppers across Nebraska would do well to pay attention.

Published monthly, the "jobs report" provides sector-by-sector employment data from the month prior. It's a product of the Bureau of Labor Statistics and includes the national Unemployment Rate.

In September, the economy added 103,000 jobs, and job creation from the two months prior was shown to be higher by 99,000 jobs higher than originally reported. This was a huge improvement over the initial August release which showed zero new jobs created.

When September's jobs report was released, mortgage rates spiked. This is because of the correlation between jobs and the U.S. economy. There are a lot of economic "positives" when the U.S. workforce is growing.

Consumer spending increases
Governments start more projects
Businesses make more investment

Each of these items leads to additional hiring, and the cycle continues.

Wall Street expects that 90,000 jobs were created in October 2011. If the actual number of jobs created exceeds this estimate, it will be considered a positive for the economy, and mortgage rates should climb as Wall Street dumps mortgage-backed bonds in favor of equities.

Conversely, if the number of new jobs falls short of 90,000, it will be considered a disappointment, and mortgage rates should rise.

There is a lot of risk in floating a mortgage rate today. The Federal Reserve could make a statement that drives rates higher, and Friday's job report could do the same. If you're under contract for a home or planning to refinance, eliminate your interest rate risk.

Lock your mortgage rate today.

Make Your Mortgage Rate Strategy : The Federal Reserve Starts A 2-Day Meeting

2011-11-01T08:04:00.001-05:00

The Federal Open Market Committee begins a scheduled, 2-day meeting today, the seventh of its 8 scheduled meetings this year, and the eighth Fed meeting overall.

The FOMC is a 12-person sub-committee within the Federal Reserve. It's the group responsible for setting the nation's monetary policy and is led by Federal Reserve Chairman Ben Bernanke.

The FOMC's most well-known role is as the steward of the Fed Funds Rate. This is the overnight rate at which U.S. banks borrow money from each other. The Fed Funds Rate is a unique, "banking" interest rate, and should not be confused with consumer interest rates, a category which includes "mortgage rates".

Mortgage rates are not set by the Federal Reserve.

Rather, mortgage rates are based on the price of mortgage-backed bonds. If mortgage rates correlated to the FOMC's Fed Funds Rate, the chart at right would be linear.

That said, the FOMC does exert influence on mortgage markets.

After its FOMC meetings, the Federal Reserve issues a press release to the public. In it, the central banker summarizes economic conditions nationwide, highlighting threats to the economy and areas of strength.

When the Federal Reserve's statement is generally "positive", mortgage rates tend to rise. This is because a strengthening economy invites investors to assume more risk, spurring equity markets at the expense of all bonds types, including the mortgage-backed kind.

When bond markets lose, mortgage rates rise.

Conversely, when the Fed is generally negative, bond markets gain, pushing mortgage rates lower throughout Nebraska.

The Fed can also influence mortgage rates via new policy.

At its last meeting, the FOMC launched a new, $400-billion round of mortgage-market stimulus known as Operation Twist. The added mortgage-bond support led mortgage rates lower post-FOMC meeting.

The Fed may expand Operation Twist as soon as Wednesday afternoon. It may also take no such steps at all. Unfortunately, there are few clues about what the Federal Reserve may do next, if anything at all. As a result, mortgage rates will be a moving target for the next 36 hours. First, they'll be volatile before of the Fed's statement. Then, they'll be volatile after the Fed's statement.

Even if the Fed does nothing, mortgage rates will change so your safest play is to lock a mortgage rate ahead of Wednesday's 2:15 PM ET adjournment.

There too much risk in floating.

Lower Your Fall/Winter Energy Bill With Ceiling Fans

2011-10-31T07:48:00.001-05:00

November is here with many parts of the country are already feeling the chill. This weekend, a nor'easter dropped up to 20 inches of snow in cities along the eastern seaboard -- a reminder that winter is coming.

No matter where you live, though, the seasonal change in temperature throughout Omaha serves as an excellent reminder to reset the blades on your home's ceiling fans.

Ceiling fans don't warm or cool air, specifically. Instead, they circulate air which can have the effect of making a room feel warmer in the winter months, and cooler in the summer months.

When it's cold outside, ceiling fans push warm air down from the ceiling, balancing the heat within a room. This can make a room feel 4-6 degrees warmer. Then, during warmer months, ceiling fans push a room's cold air back into circulation, which creates a windchill effect, of sorts.

This, too, can change a room's temperate 4-6 degrees.

The secret to a ceiling fan is in the rotation direction of its blades.

When fan blades rotate clockwise, the fan makes a room feel warmed
When fan blades rotate counter-clockwise, the fan make a room feel cooler.

This Weather Channel video explains how it works.

If your home is without ceiling fans, consider installing one (or more). Ceiling fans are economical and "green", using the equivalent energy of a 100-watt light bulb, while lowering your home's energy costs.

Plus, they're relatively simple to install.

Tutorial videos are available online for the do-it-yourselfers, or just call a qualified electrician for assistance.

Installing a ceiling fan is a 1-hour project.

Pending Home Sales Index Slips For 4th Straight Month

2011-10-28T08:26:00.001-05:00

Nationwide, fewer homes are going under contract to sell.

According to the National Association of REALTORS®, the Pending Home Sales Index fell 5 percent last month. September marks the fourth consecutive month in which the index has dropped.

The Pending Home Sales Index is a monthly index which measures the number of homes under contract to sell, but not yet closed. As such, it's among the few "forward-looking" housing indicators; a data set meant to predict future home sales.

80% of homes under contract close within 2 months so, if the September Pending Home Sales Index is to be believed, we should expect home sales to decline through October and November.

And that's before we account for cancelled contracts.

Also from the National Association of REALTORS®, we learn that 18 percent of homes under contract failed to close in September. This is double the failure rate from September 2010 and it, too, should drag Existing Home Sales volume lower this fall.

On a seasonally-adjusted, regional basis, the Pending Home Sales Index fell everywhere.

Northeast Region: -4.7% from August
Midwest Region : -6.2% from August
South Region : -5.5% from August
West Region : -2.1% from August

For home buyers and sellers in Elkhorn , though, regional data remains too broad to be useful. Housing markets are local, meaning that each block on each street on each city has its own distinct economy. When 9 states are grouped into a single "region", it's neither helpful nor relevant to people making buy/sell decisions.

That said, the Pending Home Sales Index remains important because it's about housing, and housing is a keystone of the U.S. economic recovery.

The market looks ideal for buyers. Home prices are rising, but slowly; and mortgage rates remain near rock-bottom levels. Home affordability is high and should remain that way for the next few weeks.

If you're shopping for a home, it's an excellent time to go under contract.

New Home Inventory Keeps Sinking

2011-10-27T08:22:00.001-05:00

Home builders continue to sell homes and work through inventory.

According to data from the Census Bureau, the number of new homes sold in September jumped 6 percent from the month prior, beating analyst expectations. On a seasonally-adjusted, annualized basis, buyers in Nebraska and nationwide closed on 313,000 newly-built homes last month.

It's the highest reading since April and a major reason why the available number of new homes for sale is shrinking.

As compared to September 2010, there are 19% fewer homes for sale nationwide. At today's sales pace, the complete new home inventory would be "sold out" in 6.2 months – the quickest sell-out pace since the April 2010 federal home buyer tax credit expiration.

It's no wonder builder confidence is rising.

After averaging 15 through the first 9 months of the year, homebuilder confidence jumped 4 points for October, carried by low mortgage rates and the expectation for a strong winter/spring selling season.

For buyers in Omaha , this could be construed as a housing market-shifting signal. As builder confidence rises, it becomes more difficult to negotiate for upgrades and price reductions on a new home. "Great deals" get scarce.

Furthermore, it's unlikely that mortgage rates will sustain their current, ultra-low levels into 2012. Rising rates lead to higher housing payments on a month-to-month basis.

If you're in the market for a newly-built home, in other words, today's homes may represent your best value of the year.

The Government's Revamped HARP Program For Underwater Homeowners

2011-10-25T08:13:00.001-05:00

The Federal Home Finance Agency announced big changes to its Home Affordable Refinance Program Monday. More commonly called HARP, the Home Affordable Refinance Program is meant to give "underwater homeowners" opportunity to refinance.

With average, 30-year fixed rate mortgages still hovering near 4.000 percent, there are more than a million homeowners in Omaha and nationwide who stand to benefit from the program overhaul.

To qualify for the re-released HARP program, you must meet 4 basic criteria :

Your existing home loan must be guaranteed by Fannie Mae or Freddie Mac
Your home must be a 1- to 4-unit property
You must have a perfect mortgage payment history going back 6 months
You may not have had more than one 30-day late payment on your mortgage going back 12 months

Most notable about the new HARP refinance program, though, is that the government is waiving loan-to-value requirements on a HARP loans. Homeowners' participation in the program are no longer restricted by their home's appraised value. In fact, the new HARP doesn't even require an appraisal, in most instances.

With the new HARP program, underwater mortgages can be refinanced without LTV limit or penalty.

According to the government's press release, pricing considerations for the new HARP program will be released on or before November 15, 2011; and lenders are expected to be offering the program as of December 1, 2011.

If you think you may be eligible, first confirm that either Fannie Mae or Freddie Mac is backing your loan. Both groups provide a simple, online lookup.

Fannie Mae loan lookup : http://www.fanniemae.com/loanlookup/
Freddie Mac loan lookup : https://ww3.freddiemac.com/corporate/

If your loan cannot be located on either of these two sites, your current mortgage is not backed by Fannie Mae or Freddie Mac, and is not HARP-eligible.

The FHFA's official press release contains an FAQ section. In it, you'll find minimum qualification standards, as well as information related to condominiums and to mortgage insurance.

The HARP program is meant to help a wide group of homeowners, but each applicant's situation is unique. For specific HARP questions, be sure to talk with a loan officer.

How To Change Your Doorbell

2011-10-24T08:12:00.001-05:00

When we move into a home, we make changes. Appliances get replaced, rooms get painted, and floors get refinished or recarpeted. It part of how we make a home "ours".

One item we tend to skip, though, is the changing of the doorbell. In most Papillion homes, the existing doorbell is "good enough".

Well, if you've ever had a mind to change your home's hard-wired doorbell system, the good news is that changing your doorbell is a simple, do-it-yourself project. Whether you want chimes, songs, or the traditional ding-dong, all you need is a screwdriver, some tape, and the new doorbell system.

This 2-minute video from Lowe's maps it out :

Cut the power to your doorbell from your circuit breaker
Unscrew the doorbell face plate
Replace the face plate with your new doorbell
Locate your in-home receiver and remove the chime system
Replace the chime system with your new system

The video also includes helpful tips such as how to use tape to prevent "losing" wires in your walls, and how to label your wires for faster re-wiring.

Changing a doorbell is a quick, 1-hour project. Use the video's guidance to make you don't miss a step.

Despite 18% Contract Failure Rate, Home Resales Stay Strong

2011-10-21T08:10:00.001-05:00

Despite fewer homes for sale nationwide, the number of home resales remains steady.

According to data from the National Association of REALTORS®, on a seasonally-adjusted, annualized basis, September's Existing Home Sales eased by 150,000 units, falling to 4.91 million units nationwide.

An "existing home" is a home that's been previously occupied and, despite last month's drop, September's sales volume remains the second-highest on record since April 2011.

This statistic is noteworthy for two reasons :

There are 9.9% fewer homes available for sale as compared to 12 months ago
Contract "failures" are twice as high as compared to September 2010, now averaging 18 percent nationwide

A contract failure is typically the result of homes not appraising for the purchase price; mortgage denials in the underwriting process; and, insurmountable home inspection issues.

Because sales volume is steady, we can infer that more buyers are "in the market" than the final sales tallies would have us believe. This notion is also evident in the Existing Home Supply data.

In September, the number of homes for sale fell by 69,000 nationwide. At the current pace of sales, it would take 8.5 months to "sell out" the complete national inventory. This is more than 2 months faster as compared to September 2010 -- a major improvement for the housing market and a sign that home prices should rise soon.

Today's Papillion market exemplifies Supply and Demand. Demand for homes is holding steady as home inventories fall. This creates pressure for home buyers to make offers, and multiple bidding situations become more common. Negotiation leverage shifts to the sellers and the result is that buyers pay higher prices for homes.

Thankfully, mortgage rates remain low.

Freddie Mac reports that the 30-year fixed rate mortgage ticked lower this week, averaging 4.11% nationwide with 0.8 discount points. This means that mortgage payments are lower by $46 per $100,000 borrowed as compared to the high-point of the year.

You may pay more for a new home, in other words, but you'll pay a lot less to finance it.

Finding Truth In September's Housing Starts Report

2011-10-20T08:08:00.001-05:00

Headlines in newspapers can be misleading -- especially with respect to housing figures. Media coverage of the most recent Housing Starts data serves as an excellent illustration.

Wednesday, the Census Bureau released its September Housing Starts report. In it, the government said that national Housing Starts rose 15 percent in September as compared to August 2011, tallying 658,000 units on a seasonally-adjusted annualized basis.

The September reading is the highest monthly reading since April 2010, the last month of last year's home buyer tax credit.

The sudden surge in starts is big news for a housing market that has struggled of late, and the press was eager to carry the story. Here is a sampling of some headlines:

U.S. Housing Starts Rise 15%, Hit 17-Month High (MarketWatch)
Home Building Jumps 15% in September (ABC)
New Construction Surges In September (LA Times)

These headlines are each accurate. However, they're also misleading.

Yes, Housing Starts did surge in September, but if we remove the "5 or more units" grouping from the Census Bureau data -- the catgory that includes apartment buildings and condominium structures -- we're left with Single-Family Housing Starts and Single-Family Housing Starts rose just 1.7 percent last month.

That's a good number, but hardly a great one. And for home buyers and sellers throughout Omaha and nationwide, it's the Single-Family Housing Starts that matter most. Individuals like you and I don't buy entire apartment buildings. Most often, we buy single-family homes. Therefore, that's the data for which we should watch.

The good news is that media tales work in both directions.

Building Permits dropped 5 percent last month when the volatile 5-unit-or-more-units category was included from the math. Isolating for single-family homes, we find that permits were unchanged.

This is good housing because 82% of homes begin construction within 60 days of permit-issuance, hinting at a steady, late-fall housing market.

Homebuilder Confidence Rises on Surging Sales Volume, Foot Traffic

2011-10-19T08:09:00.001-05:00

Homebuilder confidence is rebounding sharply.

Just one month after falling to a multi-month low, the Housing Market Index rebounded four points to 18 for October. It's the highest reading for the HMI since May 2010 -- the month after last year's homebuyer tax credit expiration.

The Housing Market Index is published monthly by the National Association of Homebuilders and is scored on a scale of 1-100. Readings above 50 indicate favorable conditions for homebuilders. Readings below 50 indicate unfavorable conditions.

The index has been below 50 since May 2006 -- a 66-month streak.

The Housing Market Index is a composite reading; the result of three separate surveys sent to home builders each month. Builders are asked about current single-family home sales volume; projected single-family home sales volume over the next 6 months; and current "foot traffic".

In October, builder responses were stronger in all 3 categories :

Current single-family sales : 18 (+4 from September)
Projected single-family sales : 24 (+7 from September)
Buyer foot traffic : 14 (+3 from September)

Meanwhile, of particular interest to today's Elkhorn home buyers is that builders expect volume to surge over the next two seasons. And, with current sales volume rising and foot traffic strengthening, the fall and winter months could be strong ones in the new homes market.

In addition, the builder trade group press release states that rising costs for materials are squeezing building profit margins.

For buyers, it all adds up higher home prices ahead. As builders grow more confident about the housing market, they're less likely to make concessions on pricing or upgrades. Rising building costs fortify that argument. The "great deal" will be tougher to negotiate.

At least mortgage rates are low.

Low mortgage rates are keeping homes affordable in Nebraska and nationwide. If you're looking for the right time to buy new construction, therefore, this month may be it.

Foreclosure Rate Drops For The 12th Straight Month

2011-10-18T07:50:00.001-05:00

Foreclosure activity continues to slow throughout the United States.

According to data from RealtyTrac, a national foreclosure-tracking firm, the number of foreclosure filings dipped below 215,000 in September 2011, a 6 percent decrease from August.

A "foreclosure filing" is defined as any foreclosure-related action including Notice of Default, Scheduled Auction, or Bank Repossession.

September marks the 12th straight month in which foreclosure filings fell year-over-year.

There are several reasons why foreclosure filings are down, including an increase in the amount of time it takes banks to move a foreclosure through its pipeline. It now takes a nationwide average of 336 days from the date of initial default notice to bank repossession.

Some states work quicker than others, however, because of a combination of state law and personnel.

Homes in New York take an average of 986 days to foreclose, for example, the longest in the country. Homes in Texas foreclose the quickest, registering just 86 days.

As in prior months, bank repossessions remain concentrated by state. Just 6 states accounted for half of the country's REO last month:

California : 16.6 percent
Georgia : 8.5 percent
Florida : 8.3 percent
Texas : 6.2 percent
Michigan : 6.1 percent
Illinois : 5.2 percent

Collectively, these 6 states represent just 36 percent of the nation's population.

By contrast, the bottom 6 states were home to just 192 repossessions last month -- 0.3% of the national total. Those 6 states were Alaska, Wyoming, District of Columbia, North Dakota, South Dakota, and Vermont.

For home buyers in Elkhorn , shopping for foreclosed properties can be an excellent way to get "a deal". Foreclosed homes typically sell at discounts as compared to "non-foreclosed" homes, but are often sold "as-is". This means that homes listed for sale may be defective or out-of-code.

Before placing a bid on a foreclosed home, make sure that you're represented by an experienced real estate professional.

Save Money By Preventing Water Heat Loss In Your Home

2011-10-17T08:12:00.001-05:00

How much energy is your home wasting on water?

According to the U.S. Department of Energy, water heating can account for 25% of a home's energy use. This is a substantial percentage, representing thousands of dollars per year in energy costs.

The good news is there are multiple ways to increase your home's energy-efficiency with respect to heated water.

The Department of Energy provides a list.

Reduce hot water usage : Fix leaks, install low-flow fixtures, and use high-efficiency clothes washers and dishwashers.
Lower the hot water temperature : 120ºF is ideal. Each 10ºF drop in temperature saves up to 5% and slows corrosion.
Insulate your water heater : A simple blanket wrap costs $25 and will save you up to 9% in costs
Insulate your water pipes : Water will be delivered 4ºF hotter which means lower energy use.
Install a timer : If your heater is electric, turn it off during non-peak hours such as overnight
Use greywater heat recovery systems : 90% of water's energy is typically lost down the drain.

Some of the above items are costly to implement, and others are inexpensive. Most can be handled without hiring a plumber, especially those items at the top of the list.

As a Elkhorn homeowner, take control. Apply these energy-saving, water-heating strategies and you'll not only save money each month, but you'll lengthen the useful life of your home's appliances and plumbing.

If you're in need a plumber referral, please ask.

Fed Minutes : A Fed Divided Reaches Comprise

2011-10-14T08:18:00.001-05:00

Wednesday, the Federal Reserve released the minutes from its 2-day meeting September 20-21, 2011.

The release shows a divided Fed in disagreement about the current U.S. monetary policy. The group reached compromise for new economic stimulus, however, and maintained its commitment to accommodative interest rates.

Wall Street reacted tepidly to the minutes. Mortgage rates in Papillion worsened slightly post-release.

The Fed Minutes gets less press than the FOMC's post-meeting press release, but it's every bit as important. Because it details the conversations that take place among voting and non-voting Fed members at FOMC meetings, the Fed Minutes is an inside-look at the debates and discussion that lead to new monetary policy.

As examples, here are some of the topics covered at the September FOMC meeting :

On growth : Economic growth was slow, but "did not suggest a contraction"
On housing : The market continues to be "depressed by weak demand"
On rates : The Fed Funds Rate will remain low until mid-2013

Then, with Fed members divided on whether the central bank should add new stimulus, it reached a compromise instead, launching the $400 billion "Operation Twist" program. Operation Twist is meant to lower longer-term interest rates, including mortgage rates.

Since Operation Twist began, mortgage rates are higher by nearly 0.375%.

Also noteworthy within the Fed Minutes was concern for an economic slowdown and how the Federal Reserve may react. According to the record, a slowdown may prompt the Fed to introduce its third round of qualitative easing, or QE3. An out-sized stimulus plan would likely lead rates higher.

Nothing will happen until the Fed's next meeting, however. Chairman Ben Bernanke & Co meet next November 1-2 for a 2-day meeting..

Retail Sales Expected To Rise; Mortgage Rates Should Rise, Too

2011-10-13T08:16:00.001-05:00

The American Consumer is alive and well, it seems.

Friday morning, the Census Bureau will release its Retail Sales figures for September. The report is expected to show an increase in gross receipts for the 15th straight month with analysts predicting a 0.6 percent increase from August.

The projected increase represents the largest jump in Retail Sales in six months and would likely lead mortgage rates higher for buyers in Elkhorn and nationwide.

The connection between Retail Sales and mortgage rates is fairly straight-forward. Retail Sales are the majority component of "consumer spending" and consumer spending represents the majority of the U.S. economy -- up to 70 percent, by some estimates.

And, as the economy goes, so go mortgage rates.

10 months ago, mortgage rates shot forward to start the year. This is because expectations were high for a strong economic rebound. Conforming and FHA rates crossed 5 percent at the time and were headed toward six.

By mid-April, though, it was clear that economic data was falling short of predictions. As a result, mortgage rates declined, kicking off the 2011 Refi Boom. Then, by August, on ongoing economic softness, mortgage rates in Nebraska fell further, making new all-time lows.

Expectations for a recovery have returned. Rates are now rising.

Last week's strong jobs report sparked hope for the U.S. economy and investors have been voting with their dollars. Mortgage rates are now up 7 consecutive days and Friday's Retail Sales report could cement the trend.

If you're shopping mortgage rates today, there's risk in "floating". You may want to lock your rate before Friday's Retail Sales report drives rates even higher.

The Retail Sales report will be released at 8:30 AM ET.

Quiz : What's The First Thing You Should Do After A Home Purchase?

2011-10-12T08:09:00.001-05:00

Did you remember to handle the most basic safety precaution for your new home?

When people buy homes -- in Omaha or wherever -- , there's a tendency to think "Big Picture" on home improvements. Flooring, painting and furniture are common "just-moved-in" purchases, as are cable television and utilities packages.

The most important move-in purchase, though, may also be the least expensive -- deadbolts for your doors.

Every home has at least one -- and sometimes up to dozen -- keyed points of entry. And until you change those locks, there's no telling just how many people may have access to your home.

For example, your home's prior owners may have shared house keys with any/all of the following people :

Real estate agents
Neighbors and friends
Parents, brothers and sisters
Home cleaning service
Dog walkers and pet sitters

Those keys will still gain entry into your home until you change the locks. This is why your first act homeowner should be to replace all your home's keyed entries with new locks and/or deadbolts.

Locks and deadbolts come in a variety of designs and finises, with varying price points. A basic single-cylinder, keyed deadbolt costs less than $15, and a powerful digital-entry, keyless system sells for $200-plus. There are a bevy of models at prices in between, too.

Regardless of which lock system you choose, don't procrastinate on installation. Ideally, your locks should be changed on the same day of purchase, as close to closing's completion as possible.

Hardware stores carry most deadbolt varieties and many can be installed with just a screwdriver. For complicated installations, talk to a locksmith.

Should I Refinance My Home?

2011-10-11T08:24:00.001-05:00

With mortgage rates at all-time lows, you may be asking "Is now a good time to refinance?". This short interview from NBC's The Today Show offers good insight.

Refinancing a mortgage is about more than just "low rates". For example, there are costs associated with giving a new mortgage and even with the average, 30-year fixed rate mortgage near 4 percent, the costs of a such a move can outweigh the benefits -- both in the short- and long-term.

The video originally ran in September when mortgage rates averaged 4.09%. Rates are different today, but the offered advice remains relevant.

Some of the key points raised include :

The lowest rates come with the highest costs. Consider a slightly higher-rate option from your bank.
Falling home values may make it harder to qualify for a refinance in the future. Your best time to act may be now.
If you're many years into a 30-year loan, you can consider switching to a 15-year mortgage to avoid "resetting" your term.

And, lastly, the interviewee makes a strong point that your refinance should save you enough money to make paying the closing costs "worth it". Make sure the break-even point on your closing costs versus your monthly savings occurs within a reasonable time frame.

At 4 minutes, the The Today Show video is short, but dense with quality information. For follow-up on whether a refinance makes sense for your situation, be sure to talk with your loan officer.

Freddie Mac : Mortgage Rates Sub-4 Percent

2011-10-07T07:52:00.001-05:00

Mortgage rates have dropped past 4 percent.

For the first time in more than 40 years, data from Freddie Mac's weekly Primary Mortgage Market Survey shows the average 30-year fixed rate mortgage falling below 4 percent, dropping to 3.94 percent nationwide. It's the lowest average 30-year fixed reading in the survey's history.

In addition, Freddie Mac shows the 15-year fixed and 5-year ARM making new all-time lows, too, falling to 3.26% and 2.96%, respectively.

It's a great time to be shopping for a mortgage or buying a home in Elkhorn. Because mortgage rates are dropping, housing payments are dropping, too. As compared to 8 months ago, for every $100,000 borrowed, homeowners now pay $66 less principal + interest each month.

On a $300,000 mortgage, that's $71,280 saved in 30 years.

Mortgage rates have been lower for several reasons, some of which include :

U.S. economic growth has been slower-than-expected
Uncertainty surrounds Greece and the Eurozone
The Federal Reserve's "Operation Twist"

In general, demand for mortgage bonds has been high and that's caused mortgage rates to fall. It should be noted, however, that although the 30-year fixed rate mortgage fell below 4 percent this week, the amount of discount points required to lock that rate rose by 10 basis points, or $100 per $100,000 borrowed.

Homeowners in Nebraska are paying bigger fees for these lower rates. If you plan to move within a few years, these fees may wipe out your low-rate savings.

As you shop for a mortgage, pay attention to more than just rates. Low rates are great, but not when they come with high costs. Talk to your loan officer for help with making a plan than works for you.

A Mortgage Rate Strategy Ahead Of Friday's Jobs Report

2011-10-06T11:01:00.001-05:00

Mortgage rates are prepped to make big moves in the next 36 hours. Is it time for you to call in your rate lock?

Friday, at 8:30 AM ET, the Bureau of Labor Statistics will release the Non-Farm Payrolls report for September. Issued monthly, the "jobs report" offers sector-by-sector job creation figures from the month prior, and reports on the national Unemployment Rate.

Last month, exactly zero net new jobs were created, the government said. This month, economists expect a net 60,000 new jobs created.

Depending on where the actual monthly figure falls, FHA and conforming mortgage rates in Elkhorn may be volatile. The jobs reports tends to have out-sized influence on the mortgage bond market.

The connection between the jobs market and the mortgage market is fairly straight-forward. As jobs go, so goes the economy. This is because more working Americans leads to a stronger economic base.

When more people work, consumer spending grows
When more people work, governments collect more taxes
When more people work, household savings increases

Each of these items are strengths to a recovering economy.

For rate shoppers, Friday's job report could cause mortgage rates to rise -- or fall. If the actual number of jobs created exceeded the 60,000 consensus estimate, look for mortgage rates to climb.

Conversely, if new jobs fell short of 60,000, expect that rates will drop.

Home affordability is at all-time highs because mortgage rates are at all-time lows. If you're under contract for a home or looking to refinance, eliminate some of your interest rate risk. Lock ahead of Friday's Non-Farm Payrolls release.

Get your rate lock in today.

Home Values Rose For the 4th Straight Month

2011-10-05T08:08:00.001-05:00

The government is confirming what the private sector has already shown -- home values are on the rise.

The Federal Home Finance Agency's Home Price Index shows home values rose 0.8% in July.

July marks the fourth straight month that home values climbed and the FHFA's Home Price Index is the latest in a series of "rising home values" reports -- an encouraging trend for buyers and sellers in Papillion and nationwide.

Last week, the S&P Case-Shiller Index showed home value up nearly 1 percent in July. CoreLogic reached a similar conclusion.

Nationwide, values are back to their highest levels since November 2010. Clearly, the housing market in Nebraska is moving in the right direction. Or is it?

Although the data from the government and from private firms such as CoreLogic is encouraging, it's also flawed. As such, we have to be careful about the conclusions we draw from the data.

The flaws of Home Price Index are glaring :

Only homes backed by Fannie Mae or Freddie Mac are included in the index. In today's market, because of the FHA's popularity, that leaves 1 of 3 homes "uncounted".
Only home resales are counted. New home sales are omitted entirely.
The data comes with a 60-day delay. The October market is different from July's.

Despite these shortcomings, however, the Home Price Index remains relevant. It's among the most through home valuation models and it's often used by economists and policy-makers.

When the Home Price Index is rising, Wall Street and Capitol Hill take notice. For residents of "Main Street", however, the data may not be as important. To get local, up-to-date market statistics , talk with a professional real estate agent.

Since peaking in April 2007, the FHFA's Home Price Index is off 17.6 percent.

Conforming Loan Limits Drop In High-Cost Areas

2011-10-04T08:12:00.001-05:00

For homeowners in high-cost areas nationwide, conforming and FHA loan limits have dropped by as much as 14 percent.

Effective October 1, 2011, the temporary mortgage loan limits that allowed for non-jumbo loan sizes of up to $729,750 are no longer.

$729,750 is above the "normal" loan limit of $417,000.

The elevated limits were put in place in 2008 as the economy and financial sector entered its crisis. At the time, there was little private money to serve buyers and would-be refinancers whose loan sizes exceeded Fannie Mae and Freddie Mac's maximum $417,000 loan limits.

For most people whose loan sizes exceeded that threshold, mortgage financing was unavailable. There were no lenders to back the loan size.

This was of particular importance in places such as New York City, Los Angeles and Washington, D.C. where home prices routinely top $1 million. For people in these areas, unless they had a downpayment that could lower their respective loan sizes to $417,000 or lower, mortgages were mostly unavailable.

Congress recognized this and, as a result, gave Fannie Mae and Freddie Mac temportary authorization to purchase and securitize home loans of up to $729,750 in value, depending on where the subject property was located.

The program helped housing, leading Congress to pass more permanent, location-specific loan limits. Later that same year, Congress passed the Housing and Recovery Act of 2009 which, in part, made high-cost loan limit pricing permanent, albeit at $625,500.

The $729,750 temporary limits expired Friday, September 30, 2011. Today, the maximum allowable conforming loan size is $625,500.

If you live in a high-cost area, therefore, take note. Mortgage rates may be low, but the amount of loan for which you qualify may be less than you expect, and you may find yourself ineligible.

The complete list of high-cost areas is available online.

Fall Fix-Ups For Your Home

2011-10-03T07:52:00.001-05:00

It's October and the fall season has officially started. For homeowners throughout Nebraska and nationwide, the change of season is a well-timed, "preventative maintenance" reminder.

As temperatures cool, there are a handful of do-it-yourself projects you should undertake in order to keep your home in tip-top shape through the winter. This 4-minute piece from NBC's The Today Show highlights just a few of them.

Calling it a "Fall Fix-Up Checklist", The Today Show's interview is fast-paced and wide-ranging. Some of the topics covered include :

Pick up all fallen leaves to limit damage to grass and "critter" invasions
Unclog gutters to protect windows and foundations
Turn off outside water sources and remove water from pipes and hoses

The home-tip video also shares how to find air leaks in your home, and how to fix them. Reducing air leaks can lower your home's heating and cooling bills by thousands of dollars annually.

Although the highlighted projects are DIYs, you may feel more comfortable hiring a professional. Know your "handyman limits", and remain safe at all times.

Despite Low Rates, Pending Home Sales Slip In August

2011-09-30T08:14:00.001-05:00

Despite the lowest mortgage rates of all-time, home buyers are slowing the pace at which they're buying homes.

According to the National Association of REALTORS®, on a seasonally-adjusted basis, the Pending Home Sales Index fell 1 percent in August.

The Pending Home Sales Index measures homes under contract, but not yet sold, nationwide. In this respect, the Pending Home Sales Index is a forward-looking housing market indicator; a predictor of future home sales.

It's one of the few national indices that "looks ahead" to future market conditions. Most housing data, by contrast, describes past events.

On a regional basis, only the South Region showed improvement in August's Pending Home Sales Index report :

Northeast Region: -5.8%
Midwest Region : -3.7%
South Region : +2.6%
West Region : -2.4%

That said, even the value of regional data can be questioned. Like all things in real estate, the number of homes going under contract will vary on the local level.

For example, in the Northeast Region where pending home sales slipped in August, there are close to a dozen states. Some of those states performed better than others, and there is no doubt that cities and towns exist in the region in which pending home sales actually climbed.

As a national/regional report, the Pending Home Sales Index cannot show local market data and, for that reason, it's somewhat irrelevant to everyday buyers and sellers in Papillion. If you're in the market to buy or sell a home today, it's your local housing market data that matters to you.

We watch the Pending Home Sales Index because it paints a broad picture of housing nationwide. To get local market conditions, though, you'll want to talk with a local real estate professional.

Case-Shiller Index : 85% Of Tracked Cities Showed Home Price Improvement In July

2011-09-29T08:20:00.001-05:00

Standard & Poors released its monthly Case-Shiller Index this week. The Case-Shiller Index measures home price changes from month-to-month, and year-to-year, in 20 select U.S. cities. It also reports a "national" index; a composite of the values in said cities.

The most recent Case-Shiller Index shows a 0.9% rise in home values from June to July 2011. Home values were higher in 17 of the 20 tracked cities. Only Phoenix and Las Vegas fell. Denver was flat.

Also noteworthy is that, of all of the Case-Shiller cities, Detroit posted the strongest 1-year, home price improvement. As compared to July 2010, home values are higher by 1.2 percent in Detroit. This bests even Washington, D.C. -- long-believed to be the nation's healthiest housing market.

That said, we should be careful of the conclusions we draw from July's Case-Shiller Index -- both on a city-wide level, and on a national level. This is because, as with most "home price trackers", the Case-Shiller Index has flaws in its methodology.

The first Case-Shiller Index flaw is its limited scope. Although it's purported to be a "nationa"l housing index, the data that comprises the monthly Case-Schiller Index is sourced from just 20 U.S. cities. These 20 cities represent just 0.6% of the more than 3,100 municipalities nationwide.

The second Case Shiller Index flaw is that the sample sets include single-family, detached homes only. iCondominiums, multi-unit homes, and new construction are specifically excluded from the Case-Shiller Index.

In some markets, "excluded" home types outnumber included ones.

And, lastly, the Case-Shiller Index is flawed in that it takes 2 months to gather data and report it. It's nearly October, yet we're still discussing the real estate market as it existing in July. For buyers and sellers in Omaha , July in ancient history.

The Case-Shiller Index is useful for tracking long-term trends in housing, but does little to help individuals with their choices to buy or sell a home. For relevant, recent real estate data, talk to a real estate agent in your market. Real estate agents are often the best source for real-time, real estate data.

New Home Sales Figures Better Than Reported

2011-09-28T08:11:00.001-05:00

According to the Census Bureau, the number of new homes sold slid for the fourth straight month in August, easing 2 percent from July. On a seasonally-adjusted, annualized basis, home buyers bought 295,000 newly-built homes last month.

August marked the lowest new home sales tally since February. News outlets are jumping on the story, with at least one calling it a "blow" to the housing market.

That's an unfair assessment.

It's tough for the new home market to tally big sales numbers when the number of homes for sale is dwindling and, in August, that's exactly what we saw. The number of new homes for sale nationwide fell to 162,000 last month. This is the fewest number of new homes for sale since at least 1993, the first year the Census Bureau tracked such data.

In other words, using New Home Sales as a housing market gauge may be misleading. A better metric may be new home supply.

In August, new home supply edged 0.1 months higher to 6.6 months. This means that, at today's sales pace, the complete new home inventory would be sold out in 6.6 months.

It's the second-fastest reading in 2 years.

The new home market represents an interesting opportunity for home buyers in Elkhorn. Builders are facing new competition from bank-owned homes and foreclosures, dragging builder confidence to all-time lows. Furthermore, builders have low expectations for the next 6 months.

As a buyer, you can use this to your advantage. Builders may be more willing to negotiate on price and finishes versus this time last year. You may find a good "deal" in new construction once you go in search of it.

Existing Home Sales Jump; Home Supplies Falling

2011-09-27T08:29:00.001-05:00

Are home resales rebounding?

According to the National Association of REALTORS®, Existing Home Sales rose 8 percent in August from the month prior, and 19 percent as compared to August of last year.

"Existing homes" are homes that are previously owned; ones that cannot be considered new construction.

A total of 5.0 million existing homes were sold last month on a seasonally-adjusted, annualized basis. This is slightly better than the 12-month home resale average, a statistic partially powered by "distressed sales". Distressed homes -- homes in various stages of foreclosures or sold via short sale -- accounted for 31 percent of all home resales in August.

At the current rate of sales, the national home resale inventory would be depleted in 8.5 months. This pace is a full month faster as compared to July, and the lowest home supply reading since March 2011.

Other noteworthy facts from the August Existing Home Sales report :

There are currently 3.58 million existing homes for sale nationwide
29 percent of home buyers paid cash in August
Real estate investors bought 22% of homes in August, up from 18% in July

Home prices throughout Elkhorn are based on Supply and Demand and, at least right now, it appears the supply is dropping. Furthermore, with mortgage rates at all-time lows, it's reasonable to expect demand to pick up. These two conditions should lead home prices higher.

If you're shopping for a home right now, recognize the trends and work them to your advantage. It may be "cheapest" to buy now.

How To Clean Your Home Gutters

2011-09-26T07:54:00.001-05:00

With the change of season, it's a good time to make sure your home's gutter system is clean and well-functioning.

Home gutters serve a specific purpose. By capturing and funneling rainwater away from a home "footprint" water damage to walls, windows and roofing can be minimized. A well-functioning gutter system can keep a home's basement from flooding, and a foundation safe from long-term structural damage.

Damaged or dirty gutters can lead to major home damage that may not be covered by insurance.

For homeowners , keeping clean gutters is essential. Luckily, with the right tools, gutter maintenance can be a do-it-yourself job.

First, gather the necessary tools. You'll need a ladder for climbing; a bucket for holding debris; a hose for flushing your gutters; and a small, scooping tool such as a trowel.

Next, carefully climb to your gutter. Using your hands, scoop large debris and place it in the bucket. Use the trowel to get to hard-to-reach places and for removing sticks and leaves. For safety, do not stretch to reach the next section of gutter.

After clearing the first gutter portion, step down from the ladder, move it to the next section of gutter, and repeat. Do this until all gutter sections are free from debris.

Next, find a garden hose with a spray attachment. Carry the hose up the ladder with you to the highest point of your gutter system -- usually opposite the downspout. With the water supply on, spray water into the gutter to flush the remaining debris.

If the water fails to drain, there's likely a clog in the downspout. Using a screwdriver, separate the downspout, find the clog, and remove it. Or, if you find standing water, adjust the slope of your gutter by removing the gutter hangers, fixing the slope, and re-attaching the hangers.

A gutter system should slope roughly one-quarter inch for every 10 feet of gutter.

Gutter maintenance is a twice a year task that you can do yourself. However, if you're uncomfortable on a ladder, or prefer to hire professionals, that's okay, too. As with everything in home maintenance, it's safety first.

Building Permits Rising Nationwide; Housing Starts To Follow

2011-09-23T08:13:00.001-05:00

Single-Family Housing Starts fell for the second consecutive month, dropping to a seasonally-adjusted, annualized 417,000 units in August 2011.

A "Housing Start" is defined as a home on which ground has broken.

We shouldn't put too much faith in the findings, however. Although housing starts were lower last month, as noted by the Census Bureau, the margin of error in the August Housing Starts report exceeded the actual result.

From the official report:

August's Published Results : -1.4% from July
August's Margin of Error : ±10.3% from July

Therefore, August's Housing Starts may have actually increased by up to +8.9% from July, or it may have dropped as much as -11.7%. We won't know for sure until several months from now, after the Census Bureau has gathered more housing data.

One thing is certain, though -- the long-term trend in Housing Starts is "flat". There has been little change in new home construction since last summer.

The same can't be said for Building Permits.

Considered a pre-cursor to Housing Starts, Single Family Building Permits climbed 2.5 percent with a minuscule Margin of Error of ±0.9 percent.

As is common in real estate, results varied by region:

Northeast : +3.3 percent from July
Midwest : +6.3 percent from July
South : -1.3 percent from July
West : +11.3 percent from July

When permits are issued, 86 percent of them begin break ground within 60 days. Therefore, expect Housing Starts and new home inventory to rebound in the months ahead.

For now, housing remains steady. And, with mortgage rates at all-time lows, homebuyer purchasing power in an around Elkhorn is higher than it's been in history. If you're in the process of shopping for a home, talk with your lender to plan your mortgage budget.

A Simple Explanation Of The Federal Reserve Statement (September 21, 2011 Edition)

2011-09-21T21:40:00.001-05:00

Wednesday, the Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The vote was 7-3 -- the second straight meeting at which the FOMC adjourned with as many 3 dissenters. Prior to that last meeting, there hadn't been 3 FOMC dissenters since 1992.

In its press release, the Federal Reserve presented a dour outlook for the U.S. economy, noting that since its last meeting in August:

Economic growth "remains slow"
Unemployment rates "remain elevated"
The housing sector "remains depressed"

The Fed also said that there are "significant downside risks" to the economic outlook, tied to strains in the global financial markets.

The news wasn't all bad, however.

The Fed noted that business investment in equipment and software continues to expand, and that inflationary pressures on the economy appear to have stabilized. The Fed then re-iterated its plan to leave the Fed Funds Rate in its current range near 0.000 percent "at least until mid-2013". This means that Prime Rate -- the rate to which credit card rates and lines of credits are often tied -- should remain unchanged at 3.250 for at least another 2 years.

Furthermore, as expected, the Federal Reserve launched a market stimulus plan aimed at lowering long-term interest rates. The Fed will sell $400 billion in Treasury securities with a maturity of 3 years or less, and use the proceeds to buy the same with maturity between 6 and 30 years.

Mortgage market reaction to the FOMC statement has been positive this afternoon. Mortgage rates in Nebraska are improving, but note that Wall Street sentiment can shift quickly -- especially in a market that's as uncertain as this one.

If today's mortgage rates and payments fit your household budget, consider locking in a rate. Rates can change swiftly.

The FOMC's next meeting is a 2-day affair, scheduled for November 1-2, 2011.

The Fed Adjourns At 2:15 PM ET Today : What It Means For Mortgage Rates

2011-09-21T08:13:00.001-05:00

The Federal Open Market Committee adjourns from a two-day, scheduled meeting today, the sixth of 8 scheduled meetings this year, and the seventh Fed meeting overall.

The FOMC is a designated, 12-person committee within the Federal Reserve, led by Fed Chairman Ben Bernanke. The FOMC is the voting members for the country's monetary policy. Among its other responsibilities, the FOMC sets the Fed Funds Rate, the overnight rate at which banks borrow money from each other.

Note that the "Fed Funds Rate" is different from "mortgage rates". Mortgage rates are not set by the Fed. Rather, they are based on the price of mortgage-backed bonds, a security traded among investors.

As the chart at top illustrates, the Fed Funds Rate and conforming mortgage rates in Papillion have little correlation. Since 1990, the two benchmark rates have been separated by as much as 5.29 percent, and have been as close as 0.52 percent.

Today, the separation between the Fed Funds Rate and the national average for a standard, 30-year fixed rate mortgage is roughly 4 percent. This spread will change, however, beginning 2:15 PM ET Wednesday. That's when the FOMC adjourns from its meeting and releases its public statement to the markets.

There is no doubt that the Fed will leave the Fed Funds Rate in its current target range of 0.000-0.250%; Fed Chairman Bernanke plans to leave the benchmark rate as-is until at least mid-2013. However, the Fed is expected to add new support for markets.

Unfortunately, there are few clues about how the Fed will support markets, and there is no consensus opinion regarding the size of the said support. As a result, mortgage rates should be bouncy today. First, they'll be volatile ahead of the Fed's statement. Then, they'll be volatile post-Fed statement.

Even if the Fed does nothing, mortgage rates will change. This is because Wall Street is prepping for an announcement and -- no matter what the Fed says or does -- investors will want to react accordingly.

When mortgage markets are volatile, the safest move is to lock your mortgage rate in. There too much risk to float.