Real Estate Remains The Best Investment Available.

The average home purchased five years ago has appreciated 49%. Even with the recent 2.2%decline in the median home price, this still equates to a more than 45% return on investment for the average homeowner. Media reports of a vast market decline are deceiving, and consumers will benefit from purchasing a home now before prices begin to rise once again.

According to Forbes magazine(using U.S. Department of Housing and Urban Development statistics), U.S. real estate sale prices increased more than 56% from the beginning of 1999 to the end of 2004. The S&P 500 index dipped nearly 6% during the same period.

While year -to-year fluctuations are normal, real estate remains one of the best performing and consistent long-term investments. Median existing U.S. home sale prices have increased on average 6.5% each year from 1972 through 2005, and 88.5% over the last 10 years combined. For consumers looking for long-term and stable growth rates, real estate is still their number one choice.

Existing-Home Sales To Improve, With Later Recovery For New Homes

February 07, 2007 -

Consumers are beginning to respond to more favorable housing market conditions, but new home construction will be dampened until inventories decline further, according to the latest forecast by the National Association of Realtors®.
David Lereah, NAR’s chief economist, is looking for a steady rise in existing-home sales. “After reaching what appears to be the bottom in the fourth quarter of 2006, we expect existing-home sales to gradually rise all this year and well into 2008,” he said. “New-home sales should continue to slide, but we look for that sector to turn around later in the year. When you put it all together, home sales may appear weak in comparison with the record surge in 2005, but they will be sustained at historically high levels that are in line with long-term demand.”
Existing-home sales, after reaching the third highest total on record, 6.48 million in 2006, are forecast at 6.44 million in 2007 and 6.64 million next year. New-home sales, following a fourth-best 1.06 million in 2006, are projected to decline to 961,000 this year and then rise to 971,000 in 2008.
Housing starts are likely to total 1.52 million in 2007, down from 1.80 million units in 2006, and then increase to 1.56 million next year. “When new home demand begins to catch up with supply, builders will slowly increase construction – probably in the second half of this year,” Lereah said.
The 30-year fixed-rate mortgage is forecast to rise to 6.7 percent by the second half of the year. Freddie Mac reported the 30-year fixed rate at 6.14 percent in December, but it has been trending up since. “Mortgage interest rates remain favorable, and a gradual rise means potential buyers have some time to weigh purchase decisions,” Lereah said. “When existing-home supplies become more balanced between buyers and sellers this spring, we’ll see some modest price gains.”
The national median existing-home price should grow 1.9 percent to $226,200 in 2007, after rising only 1.1 percent in 2006. The median new-home price is expected to increase 1.8 percent to $249,800 in 2007, following a similar gain last year. Stronger gains are forecast for 2008, with existing-home prices rising 3.2 percent and new-home prices increasing 3.4 percent.
The unemployment rate is seen to average 4.7 percent in 2007, compared with 4.6 percent last year. Inflation, as measured by the Consumer Price Index, is projected at 2.0 percent this year, down from 3.2 percent in 2006, while growth in the U.S. gross domestic product is likely to be 2.8 percent in 2007, down from 3.4 percent last year. Inflation-adjusted disposable personal income will probably rise 3.7 percent in 2007, up from a gain of 2.7 percent in 2006.

Minneapolis: Should Historic Alley Block $200 Million Development?

Minneapolis: Should Historic Alley Block $200 Million Development?

City officials and developers debated that question in a recent hearing on the Pacific Condo/Hotel project proposed for the 200 block of Washington Avenue. Project consultants said they did not realize construction of a parking ramp over an alley would even be a point of contention. "The alley is not a core feature of the Warehouse District," Historian Charlene Roise told the Heritage Preservation Commission, referring to the alley next to the Monte Carlo Building. Heritage Preservation and Zoning & Planning commissioners disagreed, voting that elimination of the 150-year old alley would negatively impact building bulk and scale, ultimately hurting the historic character of the neighborhood.

Nation: Why Women Pay More For Mortgages

Women are 32 percent more likely to carry mortgages with high interest rates than men with similar incomes, even though women generally have better credit scores, according to a study released recently by the Consumer Federation of America.

The study also found that wealthier women were 50 percent more likely to carry expensive loans than their male counterparts. In 2005, 10 percent of women who took out mortgages received the highest-cost sub-prime loans, compared with about 7.5 percent of men.

Why do women pay more? Allen Fishbein, the federation’s director of housing and credit policy, speculates that the most likely reason for the disparity was that women were less familiar with the mortgage market than men and didn’t shop around.

''There is some research indicating that women are, on the whole, less likely than men to bargain for major consumer purchases and credit transactions,'' he says.

A Matter of Timing

Buying real estate can sometimes involve tricky timing. For example, you
may have found the perfect house and are thinking about making an offer,
but are feeling pressured to make a decision just when you want time to
consider the matter. The agent tells you that another party is thinking
about making an offer, so you shouldn't hesitate if you really want the
house. What should you do? Trust your agent!

It is natural to feel some pressure from even the most easy-going real
estate agent--and some uncertainty about making an offer. If you really
like a house, there is always the possibility that someone else will
share your enthusiasm for it. Whether your local market is active or
sluggish, it is sensible to assume that another offer is likely to come
in. Perhaps you can afford to "sleep on it", but moving as quickly as
possible will minimize the possibility that the house will go to another
buyer.

Nation: Housing Expected To Rebound But Some Markets Will Feel Pain

Economists expect the housing market to rebound in 2007 for most of the nation. "We may be bottoming out on the sales side," says David Lereah, chief economist for the NAR. Sellers are being a lot more flexible he says and lower prices are bringing some buyers back into the market. Home builders have cut back on production of new houses which will "make for a much healthier market going forward". Lereah predicts the housing market will grow in three-fourths of the country in 2007. Markets in the rest of the country, including California and coastal resort areas from Delaware to Florida--"are going to experience some pain".

Do'a and Don'ts of home decorating

Hello friends!
We hope you have had a safe and fun year! We are looking forward to what the New Year brings! We hope this year to work with you on your buying or selling your home!

With any market conditions decorating your home can help or harm you. This great story gives some helpful tips for your home decorating! Just click the link above. We hope you all have a great New Year!