More Homeowners Have Enough Equity to Sell

RealtyTrac last week released its U.S. Home Equity & Underwater Report for September 2013.

While 10.7 million residential homeowners nationwide owe at least 25 percent or more on their mortgages than their properties are worth, another 8.3 million homeowners are now only slightly underwater or slightly above water, putting them on track to have enough equity to sell sometime in the next 15 months without resorting to a short sale.

The 8.3 million include homeowners that have a loan-to-value (LTV) ratio from 90 to 110 percent, meaning they have between 10 percent positive equity and 10 percent negative equity. These homeowners represented 18 percent of all U.S. homeowners with a mortgage as of the beginning of September.

Read more at Florida Realtors 2013

Jumbo Loans Drop Below Conventional Rates For First Time

For the first time ever, interest rates for jumbo mortgages have dropped below the average rates for conforming mortgages, lenders say.

The average interest rate for a 30-year fixed-rate conforming mortgage last week was 4.73 percent while the average for a jumbo 30-year fixed-rate mortgage was 4.71 percent, according to the Mortgage Bankers Association.

"In my 30-year career, I've never seen nonconforming loans priced below conforming loans," says Brad Blackwell, executive vice president of Wells Fargo Home Mortgage. Typically, rates for jumbo mortgages run at least 0.25 percentage points above rates for conforming loans. In 2008, jumbo mortgage rates peaked at 1.8 percentage points above conforming rates, according to HSH.com data.

"I've had situations where I've told clients, 'You don't need to borrow within the [conforming] limit. I can get you a lower rate if you borrow a little more,'" said Rolan Shnayder, director of new-development lending at H.O.M.E. Mortgage Bankers in New York.

Jumbo mortgages are those that exceed the $417,000 limit to qualify for backing by mortgage giants Freddie Mac and Fannie Mae. The limit may be lifted to $625,000 in some high-cost markets, such as New York and Washington.

Source: “'Jumbo' Mortgage Rates Fall Below Traditional Ones,” The Wall Street Journal (Sept. 4, 2013)

Home Prices Expected to Cool in Second Half of 2013

Home prices nationwide, including distressed sales, increased 12.4 percent on a year-over-year basis in July 2013 compared to July 2012 according to CoreLogic – the 17th consecutive monthly year-over-year increase in home prices nationally. 

However, home prices may be showing some signs of slowing in the coming months, according to two housing reports recently released.

CoreLogic experts predict that home prices will rise by 12.3 percent year over year in August.

But home prices likely will start to curtail in the second half of the year, says Mark Fleming, chief economist for CoreLogic.

“Price growth is expected to slow as seasonal demand wanes and higher mortgage rates have a marginal impact on home purchase demand," Fleming notes.

Source: “Home price appreciation flame begins to weaken,” HousingWire (Sept. 3, 2013)

Gator Attacks Dog in Lakewood Ranch, Florida

A neighbor's dog was attacked by this alligator this weekend in Lakewood Ranch, Florida. It was bit three times but it is OK and recovering. We have seen the dog running out the back of our home for over a year now, and I have always worried something like this would happen. Thank god the dog just needed stitches and survived it could have been a lot worse!

We were out by the pool over the weekend when we saw what looked like a fishing pole at the edge of the lake, we didn’t know what it was. Well this morning when I came back from the school run I suddenly realized what it was, they had caught the gator and were taking it away.

It’s not something you expect to see when you come in from the school run on a morning. Guess that’s Florida living for you.

Our Rescue Dog from Nates Honor Animal Rescue

No matter if your pet is young or old they bring so much joy to our lives. They live to make us happy, are the best listeners, and keep all of our secrets. Our pets enhance our lives from the very smallest that can fit into the palm of your hand to giant dogs and even the occasional farm animal they all have something special to offer us.

I can’t believe that it has been a year already since we got our beautiful Sasha, a rescue dog from Nates Honor Animal Rescue Center in Lakewood Ranch, Florida.

I just received an e-mail from them asking if I had changed her name and realized that it had been a year since we adopted 'Princess' which was her name when we went to view her at the Center in Lakewood Ranch. 

She is a cross between a beagle and dachshund, she was such a shy little thing, she was stowed away at the rear of the Center still not out for show yet, as she was waiting for all of her injections. We fell in love with her as soon as we set eyes on her and knew she was the dog for our family. She has brought so much love to our lives. Our three children adore her, she will sit for hours watching them playing in the pool, however she sits far enough away so she doesn’t get wet. She really doesn't like that!

There are SO many dogs in search of a forever home. Please always think about a rescue dog if you are thinking of getting a dog at all. Some people view rescue dogs as dogs that weren't wanted because they had problems and didn't make good pets. In the vast majority of cases, that’s just not true! Most dogs who come into rescue were not given up because they were “bad dogs” or had behavioral problems. Unfortunately, many people buy dogs without thinking about the time, effort, and expense involved in keeping a dog. These dogs end up in shelters, or along the side of the road, or, if they’re lucky, in rescue. In fact, the most common reasons a dog ends up with a rescue organization include the following:

• The owners don’t have time for the dog.
• The owners find that they can’t afford either basic vet care or the expense involved in treating an illness or injury.
• The owner dies or goes into a nursing home.
• The owners divorce and neither party can keep the dog. (You would be amazed at how many dogs we get as a result of divorces!)
• A young couple has a child and no longer has time for the dog, or the dog no longer fits into their “lifestyle.”
• The owner is moving to an apartment building that doesn’t allow dogs.

They really do make the most amazing pets. We are blessed to have Sasha as part of our family for a year now and we are looking forward to many more laughs and cuddles from our little ‘Princess’ for many more years.

Nates Honor Animal Rescue on Lorraine Road do such a fantastic job caring for all these animals they are a non-profit animal rescue organization. They are a NO-KILL sheltered environment. As soon as you walk up to the place it is just so welcoming.

I thank them very much for saving my ‘baby girl’ and all the other dogs and cats they have and continue to rescue in the future. You do an amazing job!

Florida Homes Show Robust Price Rise

Home prices nationwide, including distressed sales, increased 12.4 percent on a year-over-year basis in July 2013 compared to July 2012 – the 17th consecutive monthly year-over-year increase in home prices nationally.

Excluding distressed sales from the equation, of the five states with the highest home price appreciation Florida ranks fifth with a 13.5 percent increase.

Read more at Florida Realtors

Homeowners Ecouraged From Rising Prices

A big jump in home values has pulled 3.2 million homeowners above water on their mortgages in the past year, but that pace will slow if home price gains taper.

At the end of June, 12.2 million homeowners with mortgages – 23.8 percent – remained underwater, owing more on their mortgages than their homes were worth, according to an analysis by Zillow. That’s down from 15.3 million a year ago.

The drop in underwater borrowers correlated with a robust jump in home prices, which were up 12.1 percent for the 12 months ended in June, Case-Shiller’s 20-city index shows.

Fewer underwater homeowners is a “big plus” for the economy, says Mark Zandi, chief economist at Moody’s Analytics. “The home is still the most important asset most Americans have.”

Rising home values make people feel wealthier so they’re more likely to spend. On the flip side, if homeowners are underwater, they’re more cautious with spending, Zandi says.

Underwater borrowers are also more likely to default on home loans, which can weigh on surrounding home values. They also face more obstacles to refinance into lower-cost mortgages, which can also hurt their spending, says Svenja Gudell, Zillow senior economist.

While millions of homeowners remain underwater, another 18 percent of mortgaged homeowners have 20 percent or less equity in their homes, Zillow’s data show.

That much equity is generally needed to sell one home and have enough funds to buy another one. The swollen ranks of underwater and low-equity homeowners have affected the existing home market, Zandi says. Many people feel they can’t sell, or they don’t want to sell, at today’s prices, he says.

Even with the rapid home price gains in the past year, 57 percent of underwater homeowners carry mortgage debt that’s 20 percent or more what their homes are worth, Zillow says.

It will take years for them to regain equity, even as home values continue to recover. Some homeowners may never get back to a positive-equity situation, Gudell says.

Of the top 30 markets covered by Zillow, Las Vegas has the most deeply underwater homeowners. Almost 13 percent of mortgaged homeowners there owe twice or more what their home is worth, Zillow says. Miami is second with 8.7 percent of mortgaged homeowners in that situation, followed by Detroit at 8.2 percent.

Overall, Las Vegas also has the highest percentage of mortgaged homeowners who are underwater, at 48.4 percent. Atlanta is next at 44 percent and Orlando at 39.8 percent.

If home price gains slow, as many economists expect, the reduction in the number of underwater borrowers will slow, too. Over the next year, Zillow forecasts another 1.9 million homeowners will rise above water.

Separately, mortgage finance giant Freddie Mac reported that the average 30-year mortgage rate fell to 4.51 percent for the week ended Aug. 29, down from 4.58 percent a week ago. The average 15-year fixed mortgage fell to 3.54 percent from 3.60 percent a week ago.

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