Charlottesville Real Estate by Rob Alley of Keller Williams

Charlottesville Real Estate Market 2009 Mid Year Report

2009-07-10T14:26:00.003-04:00

The Charlottesville Real Estate Market Report was release yesterday. I have shared the information with you below:

CAAR Market Report
2009 Mid-Year
Published by the Charlottesville Area Association of REALTORS®

Where Are We Now?
The pace of home purchases in the Charlottesville area continues to improve from the dismal 4th quarter of 2008, but sales lag well behind compared to last year. The sale of homes has been increasing month to month for six months in a row. The steady improvement is easy to predict with the seasonal upswing the market naturally experiences this time of year, but based on pending sales in the MLS, we may continue to see sales increase beyond the seasonal selling season. For the first time in many months, the number of contracts in June was up from the previous year. It will be interesting to see if this trend continues.

Fueling these homes sales is the significant decrease in real estate prices. This report will detail some statistics that indicate that home prices have fallen steeply (20% or more) and this has resulted in an increase in sales. There is some evidence that sellers are starting to embrace the current market environment and price their home accordingly. The average Days on Market (DOM) has been dropping in recent months, and the median time a property takes to sell is now only 75 days. That indicates that many homes – likely the ones priced correctly – are selling quickly.

Mid-Year Home Sales
There were 1131 homes sold in the Charlottesville area during the first six months of 2009, which was down 28% (-440 sales) from 2008. After the 1st quarter, annualized sales were down 33.9%, which demonstrates the 2nd quarter improvement. All local areas were down from last year: Albemarle -15.6%, Charlottesville -35.2%, Fluvanna -34.7%, Greene -24.5%, Louisa -38.4%, Nelson -39%, and Orange – 47.1%. Monthly sales for the region have improved slightly each month since November 2008, but much of that can be attributed to seasonal swings.

Sales in the Central Valley region were generated from the Greater Augusta MLS, which has more complete data on the Valley market than the CAAR MLS. Sales were down in the Valley by 25.5 % compared to last year.

Have Home Prices Slipped?
Based on the data from the CAAR MLS, we believe that the numbers clearly show a significant decrease in home prices. The median prices listed below are the middle of the market of properties that sold. Simply put, this is an indication of what buyers were willing/able to pay and is not a true reflection of individual home prices. It is probably safe to assume that a steady, year-to-year decrease in the median price is a good indication that prices are going down, but it is not an exact measurement.

We believe the number displays below provide compelling evidence that our local real estate market has experienced a noteworthy drop in home prices. The CAAR market reports have been discussing this trend since the Fall of 2007, but this report finally shows clear evidence of the decline. The one caveat that we need to make is that part of this median price decline is a reflection of an increase in home sales in the lower price ranges. Of the 719 homes that sold in the 2nd quarter, 509 were sold for $300,000 or less. This surge in the lower end of the market will naturally pull the median price down.

Each property is affected differently by this price decline. The only way to know what your home will sell for is to have a REALTOR® or appraiser prepare a comparative market analysis (CMA) for your property. This market is changing very quickly and to be up-to-date, you need to do a CMA every two weeks. Pricing a property correctly is the best way to sell it!

Overall, the median home price (including attached homes) declined $22,900 (-8.5%) compared to the first half of last year. All areas covered in this report showed a decline. Median prices for other locales include: Albemarle (-9.4%), Charlottesville (-6.8%), Fluvanna (-19.6%), Greene (-3.4%) Louisa (-20.8%), Nelson (-6.7%) Orange (-29.7%) and the Valley (-8%).
Median Sales Prices

Price Per Square Foot (Finished)
Another indicator that allows us to see the drop in home prices is a major drop in the price per square foot numbers. The average price per square foot of finished space in homes is not a scientific number, but a downward trend over the years clearly indicates a decrease in prices (and vice versa). According to the chart below, prices peaked in 2006 and have declined for the past three years. The $18 per square foot drop in 2009 is by far the largest decline we have experienced in recent years.

Inventory Heading in the Right Direction
The inventory of homes for sale in the Charlottesville area generally increases in the first half of the year, with many homes coming on the market for the spring selling season. The good news is that in 2009 we have seen the inventory of homes shrink – not enough, but it is heading in the right direction. Having this excess of inventory is causing many of the problems with our local housing market. Until we are able to reduce the number of homes for sale, we will continue to be in a strong buyer’s market with soft home prices and very creative incentives. That’s good for buyers, but it is not any better for the long-term housing market than the strong seller’s market we experienced just a few years ago.

Currently, we have 3,602 homes on the market, compared to 3,761 at this time last year. This small decrease from last year is a positive sign, but we have a long way to go before we see appropriate inventory levels in the 2,000 to 2,500 range. The median price of homes currently for sale is $299,000, which is $9,900 less than last year. The average DOM (days on market) of these homes is 155 days, which is four days more than last year and 30 days more than homes that have sold. The most telling statistic related to homes currently on the market is that the average price per square foot is $203 compared to $143 for homes that have sold in the first 6 months of 2009.

Housing affordability is the positive aspect of this market. There are 871 homes for sale $200,000 or less with an average DOM of 141 and an average price per square foot of $143. There are 289 homes currently on the market priced at a million dollars or more with an average DOM of 226.

Days on Market (DOM)
The average number of days a property is on the market is a great indicator of a housing market’s strength. The average DOM for the Charlottesville area has been steadily increasing for the past several quarters. This trend continued in the 2nd quarter, but the increase was just 3 days more than 2008’s mid-year number. Although the increase was only a modest 3 days, it still supports the fact that we have too many homes on the market for the amount of sales. Until we work the inventory of available homes down to a more manageable number, DOM will stay high. A balanced market should have a DOM of approximately 90, but we have not been in that range since 2007.

New Construction Still Slow
It is important to note that many “new” homes are not included in CAAR MLS statistics. It is very common for a buyer to contact a builder directly to custom build a home. With that said, the historical perspective of the pace of new home sales gives us a reasonably good picture of the market for new construction. As the chart below shows, new home sales are still struggling and until the inventory of homes for sale declines, new construction will lag.

Condos and Townhomes (Attached Homes)
The sale of attached homes is only reported in Charlottesville and Albemarle because very few properties in this category are located in other counties, except Nelson. Since the condos in Nelson are primarily in the Wintergreen Resort market, we have decided not to include them in this report. One of the more interesting numbers in this report is the small increase in the sale of attached homes in Albemarle that first showed up in the 2009 1st Quarter Market Report. Charlottesville attached home sales are down 33.3%, while Albemarle sales edged up 1.8% compared to 2008. The chart below shows the attached homes sold in 2009 compared to past years. Inventory levels of attached homes for sale are still high, with an average DOM of 174 for properties currently on the market. The median price of an attached home currently on the market is $219,900. The median price for an attached home that sold in the first six months of 2009 is $223,000 for Albemarle and $239,388 for Charlottesville.

Conclusions and Predictions
Although we have been recommending the need for sellers to reduce their prices under the current market conditions, evidence of these price reductions has not shown up until this quarterly report. There is a direct relation between lower prices and higher sales. As more and more sellers price their properties according to the current market, sales should continue to increase. Increased sales is not something we normally see in the second half of the year, but this year, fueled by realistic prices, low interest rates, tax credits, and pent-up demand, may be an exception. We should see a slow but steady improvement in the number of sales for the balance of the year.

By the 4th quarter of 2009, we will likely see a year-to-year sales improvement, but only because the 4th quarter of 2008 was so bad it will be hard not to beat. 2009 is slowly heading in a positive direction in terms of sales and inventory levels and we expect that trend to continue. We may see more evidence of price declines in future market reports as more and more sellers accept the reality of this market. Additional declines in prices are possible, but it will be hard to tell if these price drops are a result of more sellers finally pricing their properties based on the current market, or a real decline in home values. Only time, and future market reports, will reveal this to us.

This Quarterly Market Report is produced by the Charlottesville Area Association of REALTORS® using data from the CAAR MLS and the Greater Augusta MLS where noted. For more information on this report or the real estate market, pick up a copy of the CAAR Real Estate Weekly, visit www.caar.com, or contact your REALTOR®.

Rob Alley, Realtor at Keller Williams Charlottesville
540-250-3275 (cell)
roballeyrealtor@gmail.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com
http://www.theaverygroup.com

Functional and Economic Obsolescence

2009-07-10T14:21:00.002-04:00

Functional and Economic Obsolescence
Though many pieces of real estate are very similar, no two are the same. One home will almost always have idiosyncrasies that separate it from other properties, regardless of whether two properties share the same floor plan or design.
Differences in age, condition, location, and utility can yield different results, and often produce different home values as well.

Functional Obsolescence
When properties are built, they don’t always adhere to the standards of a given neighborhood, floor plan, or site design. When this happens, depreciation is caused by a loss of building utility, otherwise known as functional obsolescence. In other words, if a building has reduced usefulness due to poor design, the value must be reduced.
Examples include buildings that are too big or lavish within a certain area which is considered an overimprovement, or a property that is relatively small or poor compared those around it, which is considered an underimprovement. If a building is said to be out-of-place or poorly designed for its location, it could be considered functionally obsolete.
If a property lacks a feature such as sideyard, or only contains one bathroom despite having five bedrooms, functional obsolescence occurs. It can however be curable or incurable, depending on the situation. If it is possible to tear out a wall or add a room, assuming cost is less than the value benefit, it’s considered curable. Incurable obsolescence is typically defined as overimprovements that will suffer value loss whether intact or removed.

Economic Obsolescence
Also referred to as external, location, or environmental obsolescence, this type of depreciation occurs outside the subject property. Typically this type of obsolescence occurs sometime after the property is built, as the environment around the home changes.
Examples include airport noise, toxic waste, nuclear power plants, freeway noise, dust and air pollens, changes in zoning, and more. For this reason properties located next to the freeway or under the flight path will experience reductions in value. Some even say that economic obsolescence occurs when market demand changes. Consider a home with only one bathroom. If all the new properties in the area are being built with 2 or more bathrooms, obsolescence can occur.
Most economic obsolescence is incurable, mainly because it is out of the control of the owner of the subject property, and any effort to cure such a problem would be very costly and value depleting.

Rob Alley, Realtor at Keller Williams Charlottesville
540-250-3275 (cell)
roballeyrealtor@gmail.com
http://www.robsellscharlottesville.com/
http://www.forestlakesliving.com/
http://www.charlottesvillevarealestate.blogspot.com/
http://www.charlottesvilleshortsale.com/
http://www.theaverygroup.com/

ALERT TO LOCK INTEREST RATE

2009-07-09T13:15:00.002-04:00

Alert to lock your rate if you have not done so. The treasury auction was weaker than expected. Bond market is of the highs between 19 and 30 basis points since this morning.

Mortgage rates Charlottesville

2009-07-09T11:39:00.002-04:00

Alcoa kicked off the earnings season after the close yesterday by reporting soft earnings, which depict the struggling economic climate. Also this morning, the Initial Jobless Claims came in better than expected and at the lowest level since January. However, continuing unemployment claims--which measures the number of people who still receive jobless aid after their initial week--rose by 12,000. When you add it all up, the number of Americans receiving unemployment benefits total 6.88 million, which is a new record high and more than double what it was this same time last year.
The recent rally has provided a second chance to see all-time lows in mortgage rates. That doesn't happen often and presents a huge opportunity. Currently, Mortgage Bonds are slightly lower and appear overbought.
Leonard Winslow , Dominion Trust Mortgage
434-760-2580 (cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Preforeclosures Rising in Charlottesville, now ranked #4 in VA

2009-07-08T15:52:00.007-04:00

Here is a map from Realty Trac that shows the trends in Virginia in Preforeclosures:This map shows the number of preforeclosures in the state of Virginia. Right there in Central Virginia is Albemarle County and Charlottesville Ranking #4. You can see the actual map by clicking on the picture of the one above. The definition of preforeclosure on realtytrac.com is the number of people that are at least 90 days behind and the banks have submitted it to their credit report. This is a new development in our area and further proves that the Charlottesville Real Estate market is going to get worse before it gets better and most likely driven by bank owned properties (REOs) and short sales.

Rob Alley, Realtor at Keller Williams Charlottesville
540-250-3275 (cell)
roballeyrealtor@gmail.com
http://www.robsellscharlottesville.com/
http://www.forestlakesliving.com/
http://www.charlottesvillevarealestate.blogspot.com/
http://www.charlottesvilleshortsale.com/
http://www.theaverygroup.com/

Your source for Charlottesville Short Sales and Foreclosure Information.

Charlottesville Real Estate Market Trends - Sold Statistics

2009-07-08T14:21:00.004-04:00

I posted a earlier today about the market trend for Months Supply of Inventory and here is the graph for the same two years to show the Charlottesville Real Estate Market Trend of Price of sold properties.Here again, we see a steady decrease in the price of sold properties over the last two years. Please take notice that the Charlottesville Real Estate Market of Sold Properties is DECLINING in price. This data includes all sold properties in the Charlottesville MLS. We can see that in May of 2007 the average sold price for a home was roughly a little more than $285,000. In May of 2009, the average sold price for a home was just under $255,000. By doing a little math, that's almost an 11% drop in the average sold price in 2 years. Again, the same kind of trend seen in Northern Virginia in the year before. We are heading very quickly in the direction of an REO and Short Sale Market. We are seeing this every day. Charlottesville Realtors are even adjusting their listing presentations to include finding out exactly how much the homeowner still owes on the property before taking the listing.

Rob Alley, Realtor at Keller Williams Charlottesville
540-250-3275 (cell)
roballeyrealtor@gmail.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com
http://www.theaverygroup.com

Charlottesville Real Estate Market Trends - Months of Inventory

2009-07-08T11:52:00.005-04:00

Here is a graph showing the trending of the Charlottesville Real Estate Market with regards to Months of Inventory:

As you can see by the trending line in the graph, our Months of Inventory has been steadily increasing since May of 2007. This is the exact same trend line Northern Virginia saw from 2006 to 2007. This is the first example of why I think our Market is heading the same way Northern Virginia has already gone. The Real Estate Market there is dominated by REO's (bank-owned properties) and short sale. Charlottesville needs to get ready for the short sales. It is coming fast and its about time people stop trying to fight it. Over the next couple of posts, we will look at other trends that tell the same story and just as frightening.

Charlottesville Real Estate Agents: Please don't mislead your clients telling them the market is getting better or rebounding. The agents that look their friends, family and clients in the eye and tell the truth are the ones that will be standing when this is over.

Mortgage rates Charlottesville

2009-07-08T10:57:00.003-04:00

The Second Quarter earnings season starts today, with all eyes on aluminum giant Alcoa. Although Alcoa is expected to post its third consecutive quarterly loss, Traders will be listening for Alcoa's outlook for the next few quarters as a harbinger of a potential economic recovery.
Looking at today, Bonds should continue to take their direction from Stocks, as well as the Treasury's auction of $19 Billion worth of 10-Year Notes.
Leonard Winslow, Dominion Trust Mortgage
434-760-2580 (cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow
Licensed by the Virginia State Corporation Commission. License #: MC-5112.

Bond Market Comment

2009-07-07T13:25:00.003-04:00

Bonds continue to dance just under a dual layer of resistance. Traders will likely remain cautious and keep their eyes on the initial second-quarter corporate results due out later this week. Also in the news this week is another round of Treasury securities up for auction, totaling $73 Billion. Depending on how the sale is received by the markets, it could put pressure on Bonds. For now, Bonds are in a tough spot and may find it hard to break through the overhead resistance they face. However, Stocks may face an even tougher situation.
Leonard Winslow, Dominion Trust Mortgage
434-760-2580 (cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Daily comment

2009-07-06T11:29:00.004-04:00

The financial markets are back in full swing today after the long holiday weekend. Bonds continue to remain just beneath a tough resistance level, while Stocks are getting off to a sluggish start due to concerns for the overall global economic recovery.

The ISM Services Index, which gauges the health of the non-manufacturing or service industry, came in better than expectations. Overall, the report indicates continued contraction, but at a slower pace.Many traders and investors may be taking the next few days off as an extension of the holiday weekend, which can increase volatility. I recommend floating as we see how Bonds and Stocks continue to react to important technical factors and the news of the day, but be prepared to change direction if necessary.
Leonard Winslow Dominion Trust Mortgage
434-760-2580 (cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Goodbye Roy Wheeler, Hello Keller Williams

2009-07-02T14:03:00.009-04:00

Now that its official, I can make the announcement that Cynthia and I have left Roy Wheeler Realty Co and joined Keller Williams Realty in Charlottesville.

We enjoyed our time at Roy Wheeler as well as working with the Managing Broker, Michael Guthrie, and the other agents. Roy Wheeler helped us to reach the next level in our business and we appreciate that very much.

Cynthia and I took a long time to make this decision and interviewed with several companies in the Charlottesville area. We ended up deciding on Keller Williams for a number of reasons. First, they are a national company and believe in the sharing of information and education. This is huge. The company studies the Real Estate Market, trends, and where they need to be to succeed in any market. One step better than that, they show the agents that information and train them on how to succeed in that market. We believe Charlottesville and Central Virginia is trending the same way that Northern Virginia did in 2007. Since we believe this is the case, our market will be driven by REOs and Short Sales in the near future and felt we needed to position ourselves correctly for that market shift. We are excited to work with and learn from (and maybe compete with :)) agents like Steve Bradley, a Short Sale expert and a Keller Williams Mega Agent, and Debbi Gorham, a REO expert and a Keller Williams Mega Agent, in Northern Virginia. Both believe heavily in the Keller Williams model of helping and training other agents to do what they are doing and we are fired up to add their expertise to our current system.

Keller Williams also believes in the same marketing methods that Cynthia and I believe in. We track our statistics very closely and we know what it is working for us when it comes to selling houses. The newspaper ads are returning less than a 1% Return on Investment (ROI). Newspaper advertising is not as effective as it once was. It's no secret that most home buyers are starting their search online and we can reference a number of reports whether that be from NAR, VAR, CAAR, our own brokers, and most importantly our clients. Most traditional brokerage models put that responsibility onto the individual agents to set up websites, create feeds for listing syndication like Trulia, Zillow, Homes.com and other popular sites to gain exposure to your home. Keller Williams has a program just for this that syndicates to every major website that potential home buyers are scouring for homes. What would you prefer? A company that advertises in a newspaper that reaches 38,000 people in an area with a population of 148,000 people (roughly 25% of the population) or the company that gets you exposure to the places that 82% of home buyers start their search?

Lastly, Keller Williams has offered Cynthia a leadership role in the company once she passes the Broker exam. This is the best decision available for her career in the Charlottesville Real Estate Market and her family.

In conclusion, we feel the move to Keller Williams from Roy Wheeler will be better for our business, our clients, and our families. I hope to have your support and patience as we work with Michael Guthrie at Roy Wheeler and Matthew Durbin at Keller Williams to make this transition as smooth as possible for everyone involved.

Rob Alley, Realtor at Keller Williams Charlottesville
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com/
http://www.forestlakesliving.com/
http://www.charlottesvillevarealestate.blogspot.com/
http://www.charlottesvilleshortsale.com/

Rate Watch 7/2/2009

2009-07-02T11:49:00.006-04:00

Mortgage Bonds are up this morning after grim employment news was released. According to the Labor Department, 467,000 jobs were lost in June, in addition, the unemployment rate rose to 9.5%, its highest level since August 1983. Overall, the weak Job numbers indicate that the recession continues at concerning levels.
The European Central Bank held its benchmark interest steady at 1% to help stimulate the European economy. As a result, the US Dollar has strengthened significantly, which has caused a sharp decline in Oil prices today. The decline in Oil, in turn, is applying pressure to Stocks by pushing shares of energy lower.Currently, the weak job news has helped Mortgage Bonds climb to test a dual layer of resistance. I recommend floating for now, but be prepared to lock in the gains if Bonds are pushed lower. Remember, the markets will be closed tomorrow in observance of Independence Day. Have a safe and happy holiday
Leonard Winslow Dominion Trust Mortgage
434-760-2580 (cell)
leonad.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Don't Lose Your Home to Foreclosure

2009-07-01T15:47:00.004-04:00

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com/
http://www.forestlakesliving.com/
http://www.charlottesvillevarealestate.blogspot.com/
http://www.charlottesvilleshortsale.com/

Obama Expands Refinance Program From 105% To 125%

2009-07-01T15:36:00.001-04:00

Today HUD Secretary Shaun Donovan announced that the Obama Refinance - also known as the Making Home Affordable Plan — was expanding the guidelines to allow people to refinance their homes up to 125% loan to value.

This means that people who were previously under water by more than 105% and couldn’t refinance under the Obama refinance plan can now refinance their homes as long as they do not owe more than 125% of what their home is worth.
This change in guidelines is just one more thing the Obama administration is doing to boost participation in its anti-foreclosure programs.

Prior until today’s announcement, anyone who had a mortgage that was owned by either Fannie Mae or Freddie Mac could refinance their home under the Obama refinance plan (or the Making Home Affordable Plan) as long as they didn’t owe more than 105% of what their home is worth. Todays announcement expanded that number to 125%.

Here in Virginia, and in many other parts of the country - there are many people who currently owe more than 105% on their home and prior to today, they are unable to refinance. Now as long as they don’t owe more than 125% of what their home is now worth, they can take advantage of lower rates.

According to CNN:
The move acknowledges that home prices in many areas have fallen so far that many people were shut out of the program. Some 67% of homeowners in Las Vegas — one of the hardest hit areas where Housing Secretary Shaun Donovan announced the expansion Wednesday — owe more than their homes are worth.
More than one in five borrowers are now underwater, with homes in parts of California and Florida losing more than 50% of their value, according to Zillow.com, a real estate Web site. Some 20 million people own homes worth less than their mortgages.
“The president’s Making Home Affordable plan is already helping far more than any previous foreclosure initiative and with today’s announcement we will extend its reach still further,” said Donovan.

According to Bloomberg:
The decision to change the allowable ratio is part of an effort to “adapt to an ever-changing housing market,” Treasury Secretary Timothy Geithner said in the HUD statement. “By expanding refinance eligibility, we can bring relief to more struggling homeowners more quickly.”
Paul Miller, an analyst with FBR Capital Markets in Arlington, Virginia, said mortgage brokers have told him that many aren’t sending borrowers through the program because it’s cumbersome and the loan applications “still have a lot of bells and whistles, which makes them difficult to do.”
“I don’t think it’s going to have much of an impact because you still don’t have enough qualified borrowers,” Miller said, referring to today’s announcement. “It will help on the margin, but the issues with Obama’s plans is that they all focus on affordability and not principal writedowns and at some point they’re going to have to address” that, he said.
A drop in values has left about 20.4 million of the U.S.’s 93 million houses, condos and co-ops with mortgages higher than the properties are worth as of March 31, Seattle-based real estate data service Zillow.com said in a report May 6.

My Thoughts:
I don’t know how much of an impact this expansion will have across the nation - but here in Virginiaand in other states — where many, many people owe more than 105% of their home’s value, I can see it having a significant impact.
Feel free to email or call me with questions — I am sure there will be plenty!

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

5 Financial Lessons from Celebrity Deaths

2009-07-01T14:11:00.001-04:00

Unless you’ve been living under a rock without access to radio, TV, the internet, Twitter, or Facebook for the last week you know that several celebrities have passed away from various causes.
As a society we’ve lost TV pitchman Billy Mays (heart disease), entertainer Michael Jackson (who knows), actress Farrah Fawcett (cancer), entertainer Ed McMahon (no formal reason given), and comedian Fred Travalena (cancer).
Death isn’t a fun topic, but I think there are some lessons to be learned from these celebrity deaths. Here’s a list to start with.

5 Financial Lessons from Celebrity Deaths

1. Money isn’t everything. All the money in the world doesn’t matter. All five of these celebrities made a ton of money during their lifetimes. As nice of a lifestyle as they got to live using that money it still did not prevent death. (Hint: nothing prevents death forever.) The pursuit of money, in the end, is fruitless.

2. If you don’t have your health, you have nothing. Of the five listed above only one, Ed McMahon, likely died of old age. The rest died of some sort of medical issue. Mays and Jackson were just 50 years old. In theory they should have had many more years to live on this earth. All the money in the world can’t stop cancer.

3. Life insurance and health insurance are really important. The likelihood of average folks like you and I having to worry about millions of dollars is slim-to-none. But we may suffer from the same health issues that these celebrities did. Heart disease in America? Check. Cancer? Check.
Now imagine if you didn’t wake up from going to sleep last night. Would your family be covered with a term-life insurance policy on you? If you were diagnosed with cancer today would you have health insurance to cover your treatments? Bottom line: skimping on insurance is not the way to go.

4. Having an estate plan is key. Again, imagine you didn’t wake up this morning. Does your spouse know where the will is? (Do you have a will?) An estate plan maps out for the courts exactly how you want your estate — your belongings and money — handed out. Do you want to give it all to your spouse? Do you want to leave some for the kids? Have you appointed a guardian for the kids?
The Jackson case is a perfect example of this — his mother has won temporary custody of the children and control of the estate. But is that what the will said to do?

5. Get your financial house in order. You can be “rich”, but still severely in debt. There is a significant difference between appearing wealthy and being wealthy. Jackson was $400 million in debt when he died last week. Ed McMahon was in the news a few months back for being on the brink of foreclosure on his mansion. These are two individuals that made millions upon millions of dollars and still were in debt.

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

Employment hedge

2009-07-01T12:10:00.004-04:00

The first wave of employment data hit this morning with the ADP numbers showing that the US private sector lost 473,000 jobs in June, which is quite a bit more than expectations of 394,000 jobs lost. This report comes ahead of tomorrow's official Jobs Report, where expectations have been for 363,000 jobs lost.
In other news, Stocks are getting a boost this morning on news that China's manufacturing sector has expanded, which may signal that global economies could be recovering from the current financial malaise.Looking ahead, tomorrow's official Jobs Report will probably be ugly. If that happens, Bonds should hold their own and maybe even improve a little. Therefore, I recommend floating for now. But be prepared to lock if a wild card like Census hiring skews the picture and impacts the markets.
Leonard Winslow 434-760-2580 (cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Bias to lock

2009-06-30T11:27:00.003-04:00

Mortgage Bonds traded within a few whiskers of resistance yesterday, but were then pushed back lower and have continue downward so far this morning. Adding pressure to Bonds was a better-than-expected S&P Case Shiller Home Index reading, which measures home prices in the 20 largest US cities. Overall, the report indicated that the decline of home prices is slowing, which may suggest the bottom in housing is coming closer.
In the news today, Consumer Confidence came in well below expectations, indicating that consumers became more pessimistic in June after a short-lived boost of confidence in May.Currently, prices look as though they may drop down to test support at the 200-Day Moving Average, which is another 30 basis points beneath current levels.

Leonard Winslow Dominion Trust Mortgage
434-760-2580(cell)
leonard.winslow@dominiontrustmortgage.com
www.dominiontrustmortgage.com/leonard.winslow

Mortgage rates Charlottesville

2009-06-29T10:34:00.001-04:00

Bonds are higher this morning in response to news that China, the largest holder of US debt, will continue to purchase our Bonds as part of their foreign-currency reserve policy. This good news for Bonds comes on the heels of last week's strong Treasury auction results, which showed a good foreign appetite for US Bonds.
Also this morning, Stocks are trading slightly higher and continue to do battle at their own technical ceilings of resistance.
There are no big auctions in this shortened holiday week, as all markets will be closed on Friday in observance of the 4th of July.
Leonard Winslow
Dominion Trust Mortgage
434-760-2580

How long would it take to evict former owner (but current occupant) of house acquired in short sale, in VA?

2009-06-26T18:55:00.001-04:00

A bank has approved our offer for a short sale of a home in pre-foreclosure. The current owner of the property has told us he will only move forward with settlement if he can have two months free rent back while he finds someplace to go. If it came down to it, and I accepted this offer, to what lengths could the current owner extend his stay beyond those two months–through filing bankruptcies, or other legal means that could prevent me from moving forward with an eviction? Clearly, I am not going to move forward unless I KNOW that I can control when he vacates the property. How long could he potentially "squat", once I settle on the house, before I could have him evicted? Again–for you legal experts out there–this is in the state of Virginia.

If he stays beyond the two months you can take eviction action against him - the legal term is actually an "Unlawful Detainer" action. In normal cases, it can be completed in 2-3 weeks. However, if he fights it in court, he can drag it out another 2-3 months. In nightmare cases I have seen some cases where the evictee fought it for 18 months befroe finally beeing locked out by the Sheriff.

General Rule of thumb in foreclosure and short sale purchases: NEVER allow the old owner to stay in the property. NEVER!

A much better idea is to pay for their first 2-4 months rent at another property - ie he must move - but you will pay for the deposit and two months rent for another place if he is out of the house in time. Then, if there is a problem it is someone else's problem.

Good luck

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

Foreclose On My House, Please!!!!

2009-06-26T18:49:00.002-04:00

While it sounds improbable, some American homeowners are pleading with their lenders to ‘hurry up and foreclose already!’ Homeowners who have fallen months behind on their mortgage payments sit idle, ready to move on with their lives but are unable, just waiting for their lender to make the next move.
While this “financial limbo” has brought great reprieve to some delinquent borrowers who have benefited from the “rent-free” living, for others, the limbo is a time of added stress, emotional pain, and financial liability. But the limbo not only financially hampers borrowers and investors, it poses a threat to future recovery:
The overhang of homes in limbo means that foreclosure rates are likely to increase dramatically during the second half of this year and into 2010 as lenders work through the backlog, said Bob Bellack, chairman of Zetabid, which auctions foreclosed properties.
More than ever, foreclosure has become an unattractive outcome for lenders.
This could in turn put renewed stress on financial firms that carry mortgages or mortgage-backed securities on their books. As a general policy, many firms have been marking down the value of those assets as the loans become delinquent. But once the homes go into foreclosure and are sold, their value could decline even more, prompting another round of losses at financial companies.
However, lenders have become so swamped with foreclosure filings that they’re having a truly difficult time keeping up. Moreover, our nation’s dedication to foreclosure-prevention programs has redirected a lot of lenders’ and servicers’ attention away from repossessing homes to refinancing rates and modifying loans:
“Lenders are having an immensely difficult time handling the capacity. They are torn between loan modification, short sales, foreclosures, and they are finding they can’t do all these things at once, and do them well, so we’re seeing a lot of things falling through the cracks,” said Howard Glaser, a housing industry consultant and a housing official during the Clinton administration.
Those cracks must be pretty big. According to NeighborWorks America, a large housing counseling group, 60% of homeowners who miss more than four payments before seeking help will end up in foreclosure.
Is a swift foreclosure process the most clear-cut way to speed up the housing recovery? Or has delayed foreclosures (including moratoriums) helped ease the devastating impact foreclosures have on the market?

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

Different Types of Loans

2009-06-25T16:27:00.002-04:00

Understanding Different Loan Types
The market today has been reduced to more traditional loan programs. The standards of today are fixed, adjustable, hybrid and flexed fixed. With these financing packages one can be tailored to meet your financial goals.
While the different choices may seem overwhelming at first, the overall goal is really quite simple: you want to find a loan that fits both your current financial situation and your future plans. Though this article discusses some of the more common loan types, you should spend time talking with your lender before deciding on the right loan for your situation.
Categories of loans:
Typically loans fall into one of three major categories: fixed rate, adjustable and hybrid loans that combine features from both the fixed rate and adjustable.
Fixed Rate Mortgages:
As the name describes, the mortgage is based on a fixed rate at a fixed term. The term can range from 10 to 30 years and in some cases can go to 40 years. The fixed rate mortgage has been the reliable tradition for all time. You can plan a budget based on a known monthly payment, the principal and interest does not change, you can pre-pay the mortgage, allowing you to pay the loan off early.
Adjustable Rate Mortgage:
Adjustable Rate Mortgages as the name implies change based on a new rate and new principle balance at the time of adjustment. For some people the adjustable rate is the right program. Typically a life event is going to occur in future that will allow them to pay down the balance, have another income enter into the family or just want a potentially lower payment for the first few years of the mortgage. Adjustable rate mortgages over history have a lower initial interest rate which would mean a lower payment.
The interest rate at time of adjustment is based on an index typically the one year treasury index or more recently the LIBOR, (London Inter Bank Rate) and a margin. The margin typically is 2.75%. You add the two together and that would be the rate for the ensuing time frame. The rate on most adjustable can go up or down by no more than 2% per change and no higher or lower than 6% over the life of the loan.
Hybrid Loans:
Hybrid loans combine the features of both fixed rate and adjustable rates. A hybrid will start with a moderate fixed term (5, 7, 10 years) and then will go to a 1 year adjustable for the remaining time of the loan. The same principal for adjustment as above applies with the exception of the first adjustment. Some Hybrids at the first adjustment will change by up to 5% maximum after the initial fixed term. As with the adjustable a future life event may occur; an additional income source, additional monies to pay down the mortgage, or a time frame of staying in the home.
Another possible feature could be an interest only feature for the fixed time frame. This would mean a lower monthly payment in the first years of the mortgage but would also translate to a higher payment after the fixed term.
Balloon Payments:
A balloon payment refers to a loan that has a large, final payment due at the end of the loan. For example, there are currently fixed-rate loans which allow homeowners to make payments based on a 30-year loan, even though the entire balance of the loan may be due (the balloon payment) after 7 years. As with some hybrid loans, balloon loans may be attractive to homeowners who plan to have a future life event occur. In the case of a balloon, it could be another property selling, an inheritance, or a planed move.
Strategies of mortgage planning
The general theme when planning a mortgage strategy is to ask your self several questions. These questions are:
1) How long do I plan to stay in the home?
2) How much do I want my payments?
3) How much money do I want to commit to the transaction?
Given question 2 and 3 being equally important, which one is more important?
While time is important when designing a mortgage program it is question 2 and 3 which to most people are the important ones. Time is used more for deciding a permanent buy-down of the rate is rational. The rates on the fixed and adjustable are not different as they have been in the past.
FHA :
Federal Housing Administration loans, aka FHA, are backed by the federal government by insuring the loan in cases of default. The loan requires 3.5% down and has higher qualifying ratio’s. Used predominately with borrows with limited cash resources
VA:
Veterans Administration loans, AKA VA, are loans made to qualified veterans. They do not require a down payment and are used for Veterans of the armed forces and some other government entities. VA is entitling the loan only in cases of default.
VHDA:
Virginia Housing and Development Authority, AKA VHDA, Issues bonds that are tax free in some cases and lends monies to first time homebuyers. There loans can be combined with FHA, VA, RD and conventional loan mortgage insurance. There loans have income and sales price limitations. http://www.vhda.com/ .
Conventional Loans:
A conventional loan is simply a loan offered by a traditional lender. They may be fixed-rate, adjustable, hybrid or other types. While conventional loans may be harder to qualify for than government-backed loans, they typically have higher credit scores and tighter qualifying ratios.
By:Leonard Winslow
Dominion Trust Mortgage
www.dominiontrustmortgage.com/leonard.winslow
434-760-2580

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell) roballey@roywheeler.com http://www.robsellscharlottesville.com/ http://www.forestlakesliving.com/ http://www.charlottesvillevarealestate.blogspot.com/ http://www.charlottesvilleshortsale.com/

Evander Holyfield continues to face financial woes

2009-06-25T15:50:00.002-04:00

Former heavyweight champion Evander Holyfield continues to face financial woes.

His $10 million mansion in suburban Atlanta is under foreclosure for the second time in a year.

A legal notice published last week in the Fayette Daily News revealed the former heavyweight boxing champion is in danger of losing his 109-room Fairburn mansion. The lien holder is demanding full repayment of the original $10 million loan, with an auction scheduled for July 7 on the Fayette County Courthouse steps, reports the AJC.

The 5,000-square-meter home — located on Evander Holyfield Highway — has 109 rooms, including 17 bathrooms, three kitchens and a bowling alley. It's worth an estimated $20 million and costs more than $1 million to maintain each year.

Last June a similar legal notice was published which then lead to a foreclosure notice being issued for the 5,000-square-meter home — located on Evander Holyfield Highway — has 109 rooms, including 17 bathrooms, three kitchens and a bowling alley. However, before the home was auctioned off, he was able to reach a deal to keep the home.

He also has defaulted on a loan for a second home and that's in foreclosure, too.

That home, located at 592 and 596 West Bridge Road, had an original loan amount of $216,000.

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballeyrealtor@gmail.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

Freddie Mac REO Homes in Charlottesville 6/25/2009

2009-06-25T15:30:00.001-04:00

--------------------------------------------------------------------------------
Property Status: LISTED (available for sale now)
Zip Code: 22902Loan: 328861340 Address: 194 BROOKWOOD DR, CHARLOTTESVILLE, VA Rooms: 11 Bed: 3 Bath: 2.5 Price: 334,900.00 Offered By: LONG & FOSTER RE (703) 877-7836

Zip Code: 22911Loan: 285164546 Address: 1075 WEYBRIDGE COURT 206, CHARLOTTESVILLE, VA Rooms: 3 Bed: 1 Bath: 1.0 Price: 159,900.00 Offered By: REAL ESTATE III INC (434) 817-9700
--------------------------------------------------------------------------------
Property Status: NOT LISTED (coming soon to the market; please contact listing broker for more information)
Zip Code: 22903Loan: 362483078 Address: 308 6TH ST SW APT A, CHARLOTTESVILLE, VA Rooms: 8 Bed: 4 Bath: 3.0 Price: 0.00 Offered By: LONG & FOSTER RE (703) 877-7836

Rob Alley, Realtor of The Avery Group at Roy Wheeler
540-250-3275 (cell)
roballey@roywheeler.com
http://www.robsellscharlottesville.com
http://www.forestlakesliving.com
http://www.charlottesvillevarealestate.blogspot.com
http://www.charlottesvilleshortsale.com

Bond Comment

2009-06-25T12:47:00.003-04:00

Mortgage Bonds dropped lower yesterday after the Fed's Monetary Policy and by the end of yesterday bonds climbed back to finish the day at near unchanged levels.
Todays news, Initial Jobless Claims came in a bit weaker than expected, indicating that the job market continues to be weak and slow in stabilizing.
Prices are still testing a tough ceiling of resistance at the 200-Day Moving Average. I recommend floating for now to see how Bond prices react to the government's auction of 7-Year Notes this afternoon, as well as any movement in Stocks. But be prepared to lock, since the situation can change quickly in today's volatile times.

Leonard Winslow
Dominion Trust Mortgage
434-760-2580

Fed Day

2009-06-24T15:25:00.001-04:00

Fed did not change rates orMBS & Treasury purchase program

It's Fed Day... and that means the Fed will release its Monetary Policy Decision and Statement later today. While there will be no change to the Fed Funds Rate, I will be listening for any potential news that may move the financial markets. For example, if the Fed indicates it will expand its purchase of long-term Treasuries, Mortgage Bonds may see a boost. If not, however, they may decline.
In other news today, Durable Orders came in better than expected for May, led by orders for airplanes and machinery. Although one report doesn't make a trend, the reading is encouraging and may signal that the economic slump is starting to ease.For now, I recommend floating, as we watch to see how the markets react to the Fed's statement later, as well as another government auction of 5-Year Notes today. Remember, the market can be very volatile right now, so be prepared to lock if the situation changes. I will continue to monitor the financial indicators and keep you posted.