Bank-Owned Homes in Henderson, Nevada – A Buyer’s Paradise?

The housing crisis has dropped home values all over the country, yielding some attractive deals for home buyers. But nowhere have prices fallen farther than in the so-called sand states: Arizona, Florida, California and Nevada. Take Henderson, Nevada for example. Here’s a place where you can buy a bank-owned home that was formerly worth a million dollars for less than $500,000.

At the time this article was published, there were nearly 2,200 bank-owned homes in Henderson, Nevada. Most of these homes are priced well below the peak values we saw five years ago. For anyone planning to buy a home in the Las Vegas metro area, they represent an excellent investment opportunity.

As part of the Las Vegas Metropolitan area, Henderson was also one of the cities hardest hit by the foreclosure crisis. That, combined with soaring unemployment, is what accounts for the high number of bank owned homes in Henderson, Nevada.

What’s a Bank-Owned Home, Anyway?

If you’re not familiar with bank-owned homes, here’s a quick primer. There are three basic stages of the foreclosure process. The first stage is referred to as pre-foreclosure. This is when the homeowner has defaulted on a mortgage loan, but the lender has not yet foreclosed on the property. When you buy a pre-foreclosure home (through a short sale, perhaps), your offer must be accepted by both the homeowner and the lender.

After the lender foreclose on the home, they usually try to sell it through an auction. This is the second stage in the foreclosure process. Buying a home at an auction is a good way to save money, but it’s also better left to the experienced investors. If you are not familiar with the auction process, you could end up paying too much for a home that needs a lot of work.

Then we have the bank-owned homes. If the home does not sell at an auction, it will go back on the market as a bank-owned home. Sometimes the lender will skip the auction process altogether, if they feel it’s not warranted. In either case, that property is now designated as a bank-owned home (also referred to as REO, or real estate owned).

The benefit of buying a bank-owned home is that you’re only dealing with the lender. The homeowner has been removed from the equation altogether. Price-wise, these homes typically fall in between regular listings and auctions. They are usually cheaper than the former but more expensive than the latter. In other words,buying a bank-owned home in Henderson, Nevada (or anywhere else) is a way to pay less than market value. But you won’t get as good a deal as you would through an auction or a pre-foreclosure sale. Granted, there are exceptions to every rule. But this is generally how it works in the foreclosure world.

Bank Owned

How much cheaper are they? It has a lot to do with how long the home has been on the market. “You can buy foreclosures for as cheap as 30% or 40% below market,” said John T. Reed, editor of Real Estate Investor’s Monthly. “But most foreclosures sell for 5% below market.”

For the novice home buyer, most experts recommend buying a bank-owned home over an auction or pre-foreclosure property. According to an article on “Bank-owned properties offer the safest deal for inexperienced foreclosure buyers … There’s no risk. There are no taxes, no liens, no tenants to evict.”

A Lot of House for the Money

I look at foreclosure data day in and day out, as part of my job. But the numbers don’t always tell the full story. So I went on to,, and several other real estate websites to see what you could get for the money in Henderson, Nevada. While there are plenty of good deals to be found, some of the best deals were the bank-owned homes in Henderson.

Consider the following example. I found one bank-owned property for less than $500,000 that probably would’ve been worth $1.5 million at the height of housing boom. The tax assessment was significantly lower than the listing price, so you could probably make an offer for less and still get the bank’s attention. This home had five bedrooms and four bathrooms, with a combined total of 4,000 square feet. It had a custom-built swimming pool, and is sat on nearly an acre. Granted, there aren’t that many home buyers in Henderson, Nevada now. But for the few who are qualified to get a mortgage loan, it’s like being a kid in a candy store.

The Bottom Line

There are plenty of bank-owned homes available in Henderson, Nevada. Buyers can generally get these homes for less than their true market value. You might not get them as cheap as you would through an auction, but the process is typically safer. When the property is owned by the bank, you can be reasonably sure that the title is clear (robo-signing aside). You can also get title insurance to protect your investment. And you’ll have the opportunity to do a home inspection when buying a bank-owned home, which is not always possible when buying at an auction.

Charlotte Real Estate and Mortgage Update – Q4 2010

Welcome to the Charlotte real estate and mortgage update, for the fourth quarter of 2010. Are you planning to buy a home in Charlotte, North Carolina soon? Perhaps you want to refinance your mortgage loan? Either way, you’ll find this guide helpful. We will talk about Charlotte mortgage trends, the local real estate scene, foreclosure stats and more.

couple walkingDisclaimer: This guide to Charlotte real estate was published on October 19, 2010. As a result, the mortgage rates and housing statistics may have changed by the time you read this report. For the most recent information, you can contact a real estate agent in the Charlotte area. In fact, we recommend that you do so if you’re planning to buy a home.

Charlotte Mortgage Rates

At the time of publication, the average home loan rates in Charlotte, North Carolina were as follows. These rates were compiled and averaged from a variety of local lending websites.

  • 30-year fixed – 4.29%
  • 15-year fixed – 3.81%
  • 5/1 ARM loan – 3.15%
  • 1-year ARM loan – 3.05%

When comparing these numbers to the average rates reported by Freddie Mac for the same period, you might notice something interesting. The rates for fixed-rate mortgages in Charlotte were slightly above the national average. While the rates for adjustable mortgages were slightly below the national average. This could be a reflection of the local demand for fixed versus adjustable loans, or it could just be a fluke.

As you compare Charlotte mortgage rates and lenders, you must also remember that the rate you get is driven primarily by your individual qualifications as a borrower. If your credit score and debt-ratios are better than the average borrower, then you’ll probably qualify for a better rate. And, of course, the opposite is true.

Some are predicting that benchmark mortgage rates will remain below 5% through the end of 2011. But there’s a good chance they will inch upward between now and then, as markets stabilize and activity increases. What does this mean to Charlotte home buyers and homeowners? It means that if you’re in the market for a mortgage loan, you might want to move forward sooner rather than later.

Defaults, Foreclosures and Bank-Owned Homes

Charlotte was not affected by the nationwide housing bust as much as, say, Las Vegas or San Diego. But there are still quite a few foreclosure properties on the market. At the time of publication, we found the following data on Charlotte foreclosure homes. Data was provided by

  • Pre-foreclosure homes * – 67
  • Auctions – 2,497
  • Bank owned homes – 3,849

* Pre-foreclosure means the homeowner is delinquent on the mortgage, but the lender has not foreclosed on the home yet.

There are relatively few pre-foreclosure homes in Charlotte, when compared to the bank-owned properties. This is usually a sign of a stabilizing market — not that Charlotte experienced much of a housing bust to begin with. Based on these numbers, we predict that the foreclosure inventory in Charlotte will decline steadily in the coming months.

Home Prices And Pricing Trends

According to data reported by, the average listing price of Charlotte homes for sale is between $135,000 and $165,000. The average sales price is lower, falling between $111,000 and $136,000.This suggests that many homeowners are listing their homes above market value, and/or they are being negotiated downward. Neither scenario is surprising in this kind of real estate market.

According to, Charlotte home prices have decreased by 4.5%, between August 2010 and September 2010. This was the most recent data available for pricing trends.

A recent HomeGain survey found that most Charlotte real estate agents and homeowners have a negative view on home prices. The majority of both groups felt that home prices will stay flat or decrease in the coming months. Only ten percent of agents felt that prices would rise over the next few months. This is noteworthy for home buyers. If you are planning to buy a home in Charlotte soon, you should keep a close eye on the market. You might be buying your way into a depreciating property.

FHA Loans Popular in Charlotte

FHA home loans are up in the Charlotte area, and elsewhere in the country. Over the last few years, the FHA’s market share has increased to around 30% of all mortgage activity. This number may increase even more in the near future. We recently conducted a survey to find out how many home buyers were planning to use an FHA loan. More than 80% said they wanted to use an FHA loan, mostly for the lower down-payment.

If you plan to use this government-insured mortgage program, you’ll need to find an FHA lender in the Charlotte area. The Department of Housing and Urban Development (HUD) website has a list of these lenders. Select North Carolina for state, and Charlotte for city, and then run a search. You’ll then be given a list of FHA-approved lenders in the Charlotte area.

Closing Comments

To close out this Charlotte real estate and mortgage guide, we present you with the following comments:

  • “Chief executive Wes Sturges said the Charlotte economy appears to be stabilizing, but real estate values continue to experience some deterioration.” –The Charlotte Observer
  • “Looking at our overall housing market at a regional level … you will see that while we have our issues, Charlotte is not drastically sliding price wise.” –Charlotte Property Hunters

We hope you have found our Charlotte mortgage and housing update helpful. If you would like to learn more about the home buying process, you can get started on our main website. It offers thousands of articles on mortgages, home buying, house hunting, and other topics discussed in this report.

San Diego Real Estate and Mortgage Report – Q4 2010

Welcome to the San Diego real estate report for the fourth quarter of 2010. This guide is intended to educate San Diego home buyers on mortgage trends, housing statistics, and other pertinent information. In this report, we will talk about current mortgage rates in San Diego, the local foreclosure scene, home prices and more.

san diego skyline

Disclaimer: Our real estate report for San Diego was published on October 18, 2010. Please note that the mortgage rates and other information contained in this report may have changed by the time you read it. We recommend that you seek out the most current information about the San Diego housing and mortgage market, especially if you are planning to buy a home there.

San Diego Mortgage Rates

At the time this report was published, the average mortgage rates in San Diego were as follows:

  • 30-year fixed – 4.19%
  • 15-year fixed – 3.62%
  • 5/1 ARM loan – 3.47%
  • 1-year ARM loan – 3.43%

The mortgage rates listed above are only averages. They are based on information reported by Freddie Mac for the time frame of this report.

When shopping for mortgage rates in San Diego, keep in mind that the rate you get has a lot to do with your own qualifications. You might qualify for a lower or higher interest rate than those listed above, based on your qualifications. One of the most important factors is your credit score. Lenders will use your credit score and loan-to-value ratio to determine the interest rate on your loan.

You may also have to pay points at closing, in order to qualify for the types of mortgage rates listed above. This is where the borrower prepays a certain amount of money up front, in order to lower the interest rate over the term of the loan. Depending on the difference in the long-term rate, this could work out in your favor.

Foreclosure Homes

As one of the hardest-hit states during the housing meltdown, California has a large inventory of foreclosure homes. The same goes for San Diego and surrounding areas. At the time this report was published, we found the following data relating to San Diego foreclosure homes. Data was supplied by

  • Pre-foreclosure homes * – 2,451
  • Auctions – 3,547
  • Bank owned homes – 3,910

* Pre-foreclosure means the homeowner is delinquent on the mortgage payments, but the bank has not yet foreclosed.

If you are thinking about buying a foreclosure property in San Diego, you need to educate yourself about the process. There are different stages of foreclosure, and the buying process is different for each of them. For example, if you want to buy a pre-foreclosure home through a short-sale process, your offer will be reviewed by the homeowner and the lender alike. On the contrary, if you are buying a bank-owned home in San Diego, you will submit your offer directly to the lender. You should also educate yourself about the foreclosure laws in San Diego, and find a real estate agent who is familiar with the process.

Home Prices And Pricing Trends

According to data reported by, the median sales price for San Diego homes (July 2010 – September 2010) was $322,500. Sales prices in San Diego have dropped nearly 35% over the last five years, but they seem to be stabilizing at present. The average listing price for the same period was significantly higher, suggesting that homeowners are overpricing their homes when listing them for sale.

According to, home prices in San Diego have increased by more than 8%, year over year. Their data reflects home sales and prices up to August of 2010. This is one of the few positive signs since the San Diego real estate market collapsed several years ago.

San Diego Real Estate Trends

Here are some of the things that are making news right now, with regard to the San Diego real estate market.

As you’ve probably heard, there has been a partial moratorium on foreclosures in the area. In fact, Bank of America recently halted foreclosures in all 50 states. We feel this stoppage will be temporary in nature, and that foreclosures will resume their normal pace in the near future.

Still, any slowdown in foreclosure activity means there will be an increase in inventory. If homeowners in the San Diego area are defaulting at the same rate, but the banks are foreclosing at a slower pace than before, there will eventually be a larger inventory of San Diego foreclosure homes. This would likely have a negative impact on home prices in the San Diego area. Some people are even predicting an average price reduction of 20% or more over the next year. This has yet to be seen, but there will almost certainly be a price drop of some kind. It’s something to keep your eye on, if you are planning to buy San Diego real estate in the near future.

We have also seen a rise in FHA home loans in San Diego. It’s no secret that the FHA has increased its market share since the housing bust. Borrowers who get turned down for a conventional mortgage loan can often get approved for an FHA loan. We also conducted a survey on the Home Buying Institute website recently, wherein the vast majority of respondents said they were planning to use an FHA home loan. This was a national survey, and was therefore not specific to the San Diego real estate scene. But the message is clear. FHA loans are more popular than ever.

If you wish to pursue this type of mortgage financing, you will need to apply through an FHA-approved lender in the San Diego area. You can find a list of these lenders on the HUD website.

Lastly, we would warn home buyers in the San Diego area that many homeowners are overpricing their homes. The reason for this is fairly obvious. Home prices in the San Diego area have dropped considerably in recent years. So many homeowners find themselves in a negative equity situation, where they owe more than their homes are currently worth. This is referred to as being upside down or underwater in the loan — two phrases you’ve probably heard a lot lately.

What does this mean to a home buyer? It means you need to scrutinize the asking price like never before. There is a very good chance the home you are considering is overpriced. So you need to look at comparable sales in the area to get a feel for what the market is doing. The value of a home is not determined by what the homeowner needs to get out of the deal. Nor is it determined by what the homeowner paid for the home when they first bought it. The value of a home is based on current market trends, and nothing else. Keep this in mind as you shop for homes in the San Diego real estate market.

Closing Quote

We like to close our real estate reports with an insightful comment relevant to the local market. We scour the Internet for such comments, and we choose one or two of the most useful comments to share with you. Here are some timely quotes about the San Diego real estate and mortgage scene:

  • “Lynn Reaser, an economist at Point Loma Nazarene University, said the latest figures provide further reassurance in a housing market that has experienced wide fluctuations in the last few years…” –San Diego Union-Tribune
  • “Demand builds back for housing in better neighborhoods: more buyers with cash want to take advantage of market bottom near Pacific coastlines … Public-company homebuilders buy relatively cheap residential land to prepare for an eventual upturn.” -Urban Land Institute’s Emerging Trends report

We hope you have found this San Diego mortgage and real estate report helpful. If you would like to learn more about any of the topics discussed in this guide, you can use the search tool located at the top of our main website. We have thousands of articles related to home buying, mortgages, and other topics discussed in this report.

Archive: 2013 Housing Market Predictions & Forecasts

Update: A new version of this story was published in October 2013 and includes predictions for the U.S. housing market in 2014. The story below has been retained as a historical archive.

Welcome to the housing predictions library, brought to you by the Home Buying Institute. On this page, you’ll find the world’s largest collection of real estate forecasts and predictions for 2013 and beyond. This page is updated often, as new information and insight becomes available.

Outlook for 2013: Expert Quotes and Commentary

The housing predictions below have been organized in reverse-chronological order. You’ll find the most recent commentary at the top of the page.

  • JPMorgan ChaseJPMorgan Chase, the second-largest mortgage lender in the United States, recently predicted that U.S. home prices would rise by 3.4% in 2013. That was on the low end. In a more bullish scenario, they said prices could rise by as much as 9.7%. This was originally reported by Al Yoon at the Wall Street Journal. –Prediction made in December 2012
  • freddieOn December 6, the economists at Freddie Mac released their U.S. Economic and Housing Market Outlook report for 2013. They zeroed in on mortgage rates and home prices in particular. They expect loan rates to remain near historic lows for the first half of 2013, and to rise gradually beyond that. The average rate for a 30-year fixed mortgage will likely remain below 4% for the entire year, according to their forecast. Meanwhile U.S. home prices could rise by 2% to 3% over the next 12 months. –Prediction made in December 2012
  • zillowStan Humphries, the chief economist at Zillow, is no stranger to this list. He often shares his outlook on housing-related conditions. Here’s his latest forecast: U.S. house prices will rise 1.7% over the next twelve months. Of course, this is an averaged forecast for the entire country. Some metro-level markets, like those in California, will likely see much higher appreciation. –Prediction made in October 2012
  • forbesBill Conerly, an economist and writer for Forbes, expects to see moderate improvements in the U.S. housing market through 2013. This tracks closely with our own outlook. But he is quick to point out that many homeowners are still underwater, meaning they owe more on their mortgages than their homes are currently worth. Over the past year, housing demand has outgrown construction, Conerly points out. This will continue to drive prices upward through 2013.  –Prediction made in October 2012

Archive: Housing Predictions for 2012

  • S&P IndexOn January 31, 2012, the monthly Case-Shiller / S&P Home Price Index was released. With evidence of a price decline in most metro areas, it put a damper on some of the new-year optimism we have been seeing. Unlike a lot of folks, Karl Case does not feel that the housing market is fully on the road to recovery. Shortly after the report came out, he did an interview with Tom Keene on Bloomberg’s “Surveillance” radio show. He said the “seeds of the recovery were being planted,” but there was still a rocky road ahead of us. –Prediction made in January 2012
  • zillowDr. Stan Humphries from the real estate information service Zillow anticipates additional price declines in 2012, followed by a long period where prices will remain flat. He calls it a “transitional year,” suggesting the worst may be behind us. He tempers his optimism with the reality that supply and demand is still imbalanced in many housing markets across the country, largely due to foreclosures. –Prediction made in January 2012
  • Schwab LogoLiz Ann Sonders, the chief investment strategist with investing firm Charles Schwab, expects the U.S. housing market to hit bottom in 2012. And since housing has been one of the most persistent drags on the economy, any improvement in this sector could give a moderate boost to the economy as a whole. –Prediction made in January 2012
  • PIMCONationally speaking, U.S. home prices may drop another 6% – 8% before they hit bottom. This forecast comes from Scott Simon, head of the mortgage-backed securities team at Pacific Investment Management Company (PIMCO). One of the biggest problems, according to Simon, is that current government policy has made it harder to obtain government-backed mortgages such as the FHA loan. He also said the banks are being too tight with credit, a complaint that seems to be coming from many sources these days.  –Prediction made in November 2011
  • Federal ReserveThe Federal Reserve is taking certain actions to keep mortgage rates low through 2012. One of their efforts (a new program known as “Operation Twist”) involves continued investment in long-term government bonds. According to the Fed’s policy statement: “This program should put downward pressure on longer-term interest rates.” Translation: There is a good chance we could continue to see low mortgage rates in 2012, as we have seen through most of 2011.
  • Clear CapitalClear Capital, a company that provides property-value data to mortgage companies, feels that housing prices could decline by another 3.2% through the first quarter of 2012. According to Dr. Alex Villacorta, Director of Research and Analytics at Clear Capital, the housing market lacks the fundamentals needed to stabilize prices. Mortgage rates are low and affordability is high. But jobless rates and consumer uncertainty will reduce the likelihood of price gains. –Prediction made in October 2011
  • freddieFrank Nothaft, chief economist for the government-backed mortgage giant Freddie Mac, forecasts that home prices in most of the U.S. will hit bottom in early 2012. He also expects home sales to rise by 5% next year, compared to 2011. He doesn’t expect a significant rise in prices, though — more like a long, flat bottom. Unemployment, uncertainty and excess inventory will continue to put downward pressure on home prices throughout 2012. –Prediction made in October 2011
  • Merril LynchEthan Harris, an economist and author who works for Merrill Lynch, doesn’t expect much growth in the housing sector in 2012. In fact, he doesn’t anticipate any significant growth in that area until 2013, at the earliest. He shared these thoughts during an interview on Bloomberg Television. According to Bloomberg, Harris is one of the most accurate forecasters on the economy. Harris pointed to unemployment, which is still hovering above 9%, as one of the biggest problems for the housing market. –Prediction made in September 2011
  • RBC Capital MarketsDuring an interview with Bloomberg Television, housing analyst Robert Wetenhall predicted that home prices could fall by 5% – 15% in 2012. Wetenhall works for RBC Capital Markets, an investment banking firm headquartered in Canada. Like many people, Wetenhall, points to foreclosure inventories as one of the biggest problems for the housing market in 2012 and beyond. He referred to it as a “multi-year” problem. He added that without a housing solution, we will not have a broader economic solution. –Prediction made in September 2011
  • MacroMarkets LLCOn September 21, 2011, MacroMarkets LLC published the results of its home price expectations survey for that month. The survey is sent to 111 economists, investment analysts and housing experts. The September survey showed that most of the respondents had a pessimistic outlook regarding home prices. According to the survey, most of the experts predict that home prices will only rise by 1.1% through 2015. Thus, their price expectations for 2012 are mostly flat. –Prediction made in September 2011
  • Mortgage Bankers AssociationOn September 12, 2011, the Mortgage Bankers Association (MBA) said they do not expect any major improvements in the U.S. economy over the next year and a half. They expect to see mortgage rates of around 4.5% for much of next year. The group anticipates a rise in home-buying activity in 2012, as well. Their mortgage-rate predictions reflect many of the other forecasts we have seen in our research — most people expect rates to stay low through the first part of 2012. –Prediction made in September 2011
  • Politico LogoJosh Boak, an economics reporter for Politico, feels that the housing market won’t see any significant recovery for several more years. At least, that’s what he wrote in a feature story about the challenges President Obama faces in 2012. To be more accurate, Mr. Boak (a former reporter for the Chicago Tribune) was summarizing remarks made by former Fed chairman Alan Greenspan. Mr. Boak rightfully points out that low mortgage rates have not been enough to spur the ailing housing market. –Prediction made in September 2011

Archive: Forecasts Made for 2011

  • Mortgage Bankers AssociationOn January 26, 2011, the Mortgage Bankers Association (MBA) said they expect the average interest rate on 30-year fixed-rate mortgages to reach 5.3 percent later this year. In 2010, the average rate in this category was 4.7 percent. The MBA also said the number of refinance loans could drop by as much as 66 percent. Home purchase loans on the other hand are expected to rise in 2011, albeit slightly. –Prediction made in January 2011
  • RealtyTrac LogoRick Sharga of RealtyTrac has appeared on the housing predict-o-meter before. Now he’s back with another grim forecast. Mr. Sharga and the folks at RealtyTrac expect the number of U.S. homes receiving a foreclosure filing will climb by about 20 percent in 2011. This is staggering, when you consider the number of foreclosures over last year. He also feels that foreclosures will peak in 2011. –Prediction made in January 2010
  • University of ChicagoCasey Mulligan, an economics professor at the University of Chicago, disagrees with the rising number of analysts who are predicting a double-dip in home prices for 2011: “Predicting the future is difficult, but the … data so far do not seem to suggest that home values will be significantly different this year [in 2011] than they were in 2010.” –Prediction made in January 2011
  • Wells Fargo logoAccording to Mark Vitner, a senior economist at Wells Fargo Securities: “Housing is going to remain dead in the water through the middle of [2011] … As foreclosures come back on the market, that will put downward pressure on prices.” Foreclosures “coming back” is a reference to the current slowdown in foreclosure processing, which began with the robo-signing scandal. –Prediction made in December 2010
  • Federal ReserveOn December 14, 2010, members of a Federal Reserve committee met to discuss the current and future state of the economy. According to the minutes from that meeting, the committee feels the U.S. housing market will weaken further in 2011. Low demand and high inventory were cited as the primary causes. Some participants noted that the “overhang of foreclosed homes” would contribute to further price declines in many areas. –Prediction made in December 2010
  • On December 8, 2010, Oliver Chang and other financial analysts from Morgan Stanley released a report with their thoughts on the housing market. According to the report, the analysts expect home prices in the U.S. to fall as much as 11 percent by 2012. The reasons cited? Supply and demand, of course. “We see the trough occurring in 2012 instead of our previous call of 2011,” said Chang. –Prediction made in December 2010
  • Trulia LogoPete Flint, chief executive of, feels that rising mortgage rates will reduce housing demand in 2011. “Nationally, prices will decline between 5 percent and 7 percent,” Flint said, “with most of the decline occurring in the first half of next year [2001].” –Prediction made in December 2010
  • RealtyTrac LogoRick Sharga, Senior VP of the foreclosure-tracking company RealtyTrac, sees a rise in the number of pre-foreclosure homes over the next few months. He predicts that many of these homeowners will simply walk away from their homes. “Even with today’s low interest rates,” Sharga said, “you’re looking at an average of $1,000 or more in mortgage payments on loans that are overvalued by about 30 percent. That is where you will see a high level of walkaways.” –Prediction made in December 2010
  • freddieFreddie Mac appeared on our housing market predict-o-meter back in October. Here’s another set of predictions, this time from their chief economist Frank Nothaft. This commentary comes from the Freddie Mac blog, where Mr. Nothaft recently shared his thoughts on the type of housing market we’ll see in 2011. He feels that fixed mortgage rates will remain below 5 percent next year, while the 5/1 ARM will remain below 4 percent. He also forecasts a rise in purchase loans and a decline in refis. –Prediction made in December 2010
  • In an interview with Steve Bergsman from Inman News, Scott Sambucci said he expects home prices to fall another 7 – 9 percent in 2011. Mr. Sambucci is the director of business development at Altos Research, a company that provides data-analysis services to the real estate industry. Sambucci also writes many of the posts on the company’s “How’s the Market” blog. –Prediction made in December 2010
  • Fannie MaeIn late November, Fannie Mae released its housing forecast for that month. The report also included a forecast for home sales through 2011 and beyond. When you compare their 2011 end-of-year predictions to actual sales numbers from the beginning of 2010, you basically have a flat line. This suggests another sluggish year for the housing market. –Prediction made in November 2010
  • Economic analysts from Standard and Poor’s have made the prediction that home prices will drop another 7 – 10 percent in 2011. Here again, the usual suspects are cited as being the cause for the potential declines — unemployment and inventory. S&P credit analyst Erkan Erturk said that the price declines at least seem to be slowing, when compared to the last two or three years. –Prediction made in November 2010
  • fiservFiserv, an information-management company in the financial sector, recently revised its home-price projections for 2011. In February 2010, they were fairly optimistic about the housing market, predicting national price gains of about 4% through the end of 2011. Their latest prediction is for a 7.1% drop in prices through the summer of 2011. According to David Stiff, the chief economist at Fiserv: “Some of the largest declines in prices will occur in markets that had strong spring and summer 2010 price increases.” –Prediction made in November 2010
  • Moody's AnalyticsMark Zandi, the often-quoted chief economist from Moody’s Analytics, recently predicted another 8% drop in home prices through the third quarter of 2011. “There’ll be no vicious, self-reinforcing spiral down,” he said. “[But] more home price declines are coming.” If Zandi’s prediction holds true, it will signify a 34% drop in home values from the height of the housing bubble. –Prediction made in November 2010
  • Mortgage Bankers AssociationOn October 26, 2010, the Mortgage Bankers Association released its mortgage finance forecast for 2011. If their predictions are accurate, mortgage rates will slowly rise between now and the end of 2011. For example, consider the benchmark 30-year fixed-rate mortgage. The current average rate in this category (as of October 21, 2010) is 4.21 percent. The MBA is predicting that these rates will gradually rise through 2011, exceeding 5 percent by the end of that year. –Prediction made in October 2010
  • BloombergNicolas Retsinas, the director of Harvard University’s Joint Center for Housing, recently discussed the future of the housing market on Bloomberg Television. Among other things, Mr. Retsinas said: “I don’t suspect we’re going to see any increases in the mortgage rate in the near future. What I worry about is that when interest rates do finally turn, they may go up quickly.” –Prediction made in October 2010
  • Wall Street JournalOn the Wall Street Journal website, Nick Timiraos wrote that many economists are revising their predictions about the housing market. The now-defunct tax credit for first-time home buyers created a temporary burst of activity. This led to predictions for a housing bottom in 2010. But now, says Timiraos, “some economists don’t see a recovery until late next year or early 2012.” –Prediction made in October 2010
  • forbesOn October 19, 2010, John Mauldin wrote an interesting post to his blog on Mr. Mauldin revised an earlier prediction he made about nationwide housing bottoms — and not for the better. “I wrote three years ago that it could be well into 2011 before we get to a bottom,” he said. “That may have been optimistic.” He agrees with Gary Shilling that home prices might fall another 20%, before we find a true bottom. –Prediction made in October 2010
  • freddieIn October 2010, Freddie Mac published an economic forecast that included various housing predictions. Among other things, the company feels that mortgage rates will stay below 5% for the next year or so (until the end of 2011). They are predicting that average rates on 30-year fixed mortgage loans will remain around 4.4 percent through the last quarter of 2010, rise to 4.5 percent during the first quarter of 2011, and inch upward toward 5.0 percent by the end of 2011.  –Prediction made in October 2010
  • nabeIn October 2010, the National Association of Business Economics (NABE) released the results of a survey of economists. Among other things, the survey pointed toward a significant increase in housing starts in 2011. According to the report, home prices have already hit bottom in most of the U.S. But home price increases in 2011 will probably still fall short of inflation. –Prediction made in October 2010
  • zillowStan Humphries, chief economist at Zillow, believes that most real estate markets in the U.S. will hit bottom in the third quarter of 2010. He also believes that the bottom will be “long and flat,” as opposed to a quick rebound. “Think about it less in terms of a bottom than as second phase of the housing market,” he added. –Prediction made in June 2010
  • berkshireWarren Buffett, one of the most successful investors in the United States, predicted that the real estate slump will be behind us by 2011. In his annual letter to shareholders of Berkshire Hathaway, Buffet wrote that “Within a year or so, residential housing problems should largely be behind us.”. –Prediction made in February 2010
  • timeAn article in Time magazine pointed out that many housing-market experts believe prices will bottom out in 2010. But it may be 2013 before the market noticeably rebounds. That same article quoted David Goldberg, an analyst with UBS, who said: “Some markets still have further [down] to go, but we’re definitely in the latter innings of the downturn.” –Prediction made in January 2010

Disclaimer: The housing market predictions listed above are provided “as-is” with no warranties or guarantees of any kind. We have compiled this information for educational purposes only. We are making no predictions of our own regarding the economy.

Survey Reveals Biggest Fears Among Home Buyers

Napa, CA – U.S. Housing News — A recent survey by the Home Buying Institute revealed the greatest fears and concerns among home buyers. On the top of the list: an overwhelming mortgage payment.

We asked thousands of home buyers what their biggest fears were, with regard to the home-buying process. The majority of respondents said they were afraid of having a mortgage payment that’s too big for them. These results seem to suggest that many home buyers don’t set a budget for themselves, before talking to lenders.

Survey details: This survey was presented to more than 7,000 readers, through the Home Buying Institute website. The survey started with a simple question: “What is your biggest fear about buying a home?” Respondents were able to choose one of seven responses, which covered most concerns of the average home buyer. Of the home buyers who responded, most said they were afraid of taking on too much of a mortgage payment. Many were also concerned about overpaying for a home.

Home Buyer Fears
Chart: Home buyers are afraid of overwhelming mortgage payments. Image permission

As shown above, the responses broke down as such:

  • 36.4% said they were afraid of ending up with a mortgage payment that’s too big.
  • 22.7% feared they might pay more for a home than it’s worth.
  • 15.9% were afraid of losing their jobs after taking on a mortgage loan.
  • 10.2% were concerned about buying a home with major structural problems.
  • 4.5% were afraid of choosing the wrong type of mortgage loan.
  • 4.5% feared another housing bubble-and-bust cycle, like the one we just went through.

Addressing Home Buyer Fears

Brandon Cornett, publisher of the Home Buying Institute, explained his company’s motivations for running the survey. “More than anything, we wanted to identify the knowledge gaps among our readers. By understanding what scares home buyers the most, we are better able to publish meaningful content. We can write articles and tutorials that address these fears.”

If you’re afraid of having a mortgage payment that’s too large:

Home buyers who are concerned about an over-sized mortgage payment should establish a budget for themselves. By reviewing your monthly income and debt expenses, you can set a monthly limit for your housing costs. It’s important to do this before you apply for a mortgage loan. Believe it or not, you can be approved for a mortgage amount that exceeds your comfort level. So do the math for yourself. Find out what you can comfortably afford to spend each month. You can learn more about mortgage affordability here and here.

If you’re afraid of paying more than the home is worth:

Home buyers should know it’s called an “asking price” for a reason. Just because a home is listed for a certain amount doesn’t mean it’s worth that much. Our research shows that many homes are initially listed above their market values. Call it wishful thinking on the seller’s part. As a home buyer, the last thing you want to do is overpay for a house. It erodes your equity from day one. But this situation can easily be avoided. You should base your offer on recent sales in the area.

If you’re afraid of losing a job (and your ability to make payments):

Double-income couples need to consider the impact of one spouse losing a job. If you can’t cover the mortgage payments on a single income for a few months, you may be buying too much house. Make sure you have an emergency fund to protect you in such scenarios. This means having enough money in your savings account to cover up to six months worth of mortgage payments. It’s a slow job market, after all. The emergency fund is even more important for single-income families.

If you’re afraid of buying a home with major flaws:

Every home buyer should pay for a home inspection. It only costs a few hundred dollars, and it gives you the peace of mind of knowing what lies beneath. A home inspector will slap on a pair of coveralls and get into the guts of the house. He will examine the foundation, the attic, the roof, and all of the installed systems (plumbing, electrical, HVAC, etc.). If there’s a major problem with the house, a professional home inspector will find it. You can learn more about home inspections in this FAQ article.

If you’re afraid of choosing the wrong type of mortgage loan:

Research is the key to success here. You should start by learning the key differences between adjustable and fixed-rate mortgages. This is where a lot of first-time buyers get into trouble, choosing the riskier ARM loan for a long-term stay. You should also consider the pros and cons of FHA home loans, one of the most popular financing methods today. You can learn more about the different types of mortgage loans on this page.

Image permission: You may use this chart graphic to write a news piece of your own, provided that you cite the source. A link back to this story would be appreciated.

Upside Down Mortgage Help for Homeowners

upside down houseAs of August 2010, when this article was published, approximately 11 million homeowners were upside down in their mortgage loans. Much of this results from the housing crisis that came to a head in 2008. In the wake of that financial crisis, property values began dropping all across the country. In places like California, Arizona and Florida, they dropped considerably.

This leaves many homeowners scratching their heads over what to do next. What can you do about an upside down mortgage loan? Can you sell or refinance the home when you’re in this boat? Is there any help for upside down homeowners? These are the questions we will address below.

A Resource for Upside Down Homeowners

As the number of upside down homeowners has grown, so too have the number of programs available to them. But this creates a dilemma. With so many program updates and announcements, the average consumer is left feeling overwhelmed and confused. There is help for homeowners with upside down mortgage loans — it’s just hard to find the right path. Our goal is to compile information and resources related to upside down mortgage loans. We will update this page as needed, to ensure it stays current.

The Upside Down Mortgage, Defined

What is an upside down mortgage loan? Here’s a simple definition: If you owe more on your mortgage than your home is currently worth, you are upside down in the loan.

Here’s an example. If my home is worth $185,000 in the current market, but I owe $195,000 on my mortgage loan, I am upside down. My loan balance exceeds the value of my property. This is also referred to as being underwater in the loan. The two terms are interchangeable.

Why Is This a Problem?

Upside down homeowners have a hard time selling or refinancing their homes. If you sell the house for less than what you owe to the lender, you’ll probably have to pay the difference out of pocket. On the refinancing side, the lack of equity makes it hard to qualify for a mortgage refinance loan. Upside mortgage loans can create a situation where the homeowner is “stuck” — can’t sell the house, can’t refinance the loan.

When homeowners plan to stay in the home for a long time, being upside down is less of a concern. They can simply stay put, continue making their mortgage payments, and hope that their property values rise again in the future. But for those who want to sell or refinance their homes, an upside down mortgage will put up a financial roadblock.

Refinancing Options Through the FHA

Underwater homeowners are often unable to refinance their homes. They lack the equity that most lenders require. But there is help for upside down homeowners who want to refinance.

In May 2010, the Department of Housing and Urban Development (HUD) announced changes to the FHA’s loan-backing program that would make refinancing possible for underwater homeowners. This new program will be rolled out in the fall of 2010. To qualify, homeowners must (1) have a loan that is not currently insured by the FHA, (2) be current on their mortgage payments, and (3) be upside down in their mortgage loan. TARP funds are being used to give incentives to lenders, encouraging them to participate in the program.

This program is being referred to as the FHA short refi for underwater homeowners, and you can learn more about it through the links below:

Other Programs to Help Homeowners

If your mortgage loan is currently owned or guaranteed by Freddie Mac or Fannie Mae, you may have additional options for underwater refinancing. This would be through the federal government’s Making Home Affordable program. Here again, you need to be current on your mortgage payments to pursue this option.

You can learn more through the links below:

Upside Down Mortgages in the News

It is our goal to make this resource page as useful as possible. So we will be tracking the various programs and topics mentioned above. Here is some recent (2010) news regarding upside down mortgages and help for homeowners.

Fannie Mae and Freddie Mac – Past, Present and Future

Mortgage buyers Fannie Mae and Freddie Mac could be restructured in the near future. We just don’t know how. There are currently dozens of proposals on the table, and a meeting of the minds recently concluded in Washington. Still, the question remains: What should we do with Fannie Mae and Freddie Mac?

These two organizations affect every home buyer in the country. But many people don’t even know what Fannie and Freddie do. Sure, they’ve heard their names thrown around — it’s hard to read a newspaper without hearing about them. But they still remain a mystery to the average American. So we thought it was time to create a retrospective. We call it Fannie Mae and Freddie Mac – Past, Present and Future.

Housing History: The Birth of Fannie and Freddie

fannie mae logoHistory gives us a certain perspective we would otherwise lack. So let’s take a walk down memory lane.

The year was 1938. The United States economy was in terrible shape, in the wake of the Great Depression. Housing was unaffordable for many Americans. So Congress created an organization to make home ownership easier to reach. That organization was the Federal National Mortgage Association — Fannie Mae for short.

The rise of Fannie Mae created what is now known as the secondary mortgage market. Back then (and still today), Fannie Mae purchased mortgage loans from lenders. This increased liquidity within the mortgage market, and made lenders willing to give more loans to more people.

Fannie Mae enjoyed three decades of being a government-sponsored monopoly. It was the only organization that bought (and sold) loans from banks and lenders. In 1968, Lyndon B. Johnson privatized Fannie Mae to get it off the “government books.”
freddie mac logo
So now you had a private company that received federal support and monopolized a certain area of the American economy. Talk about Frankenstein’s monster!

To “solve” this dilemma, the government created a competitor for Fannie Mae. Thus, the Federal Home Loan Mortgage Corporation — a.k.a. Freddie Mac — was born in 1970.

Fast Forward: Fannie Mae and Freddie Mac Today

For years, Freddie Mac and Fannie Mae were private corporations that enjoyed tremendous profits (from buying, bundling and selling mortgage loans). But that status quo changed in 2008, at the height of the mortgage and credit crisis.

Today, Fannie and Freddie are being managed by the Federal Housing Finance Agency, or FHFA. They were seized by the government in 2008, and placed into a “conservatorship” status. This means that Uncle Sam took over the management (and much of the cost) of running the two organizations. Furthermore, the federal government has pledged unlimited Treasury support to keep Fannie and Freddie afloat.

Freddie recently asked for an additional $1.8 billion in August 2010. Including this request, the two government-sponsored enterprises have soaked up more than $148 billion in government aid since April 2009. They are still posting losses, too, mostly resulting from mortgage defaults. So the government will likely spend more money on Fannie Mae and Freddie Mac in the near future. How much more remains to be seen.

What Does the Future Hold?

The Obama administration is currently seeking proposals on how to restructure Freddie Mac and Fannie Mae. Meanwhile, many people are arguing that we should pull the plug instead. In August 2010, a high-level conference was held in Washington D.C. to discuss the different options for reshaping Fannie and Freddie. There are many ideas on the table, but no singular direction at the moment.

  • On the one side, you have supporters who stress the importance of governmental guarantees on home loans. Their argument is that, without Fannie Mae and Freddie Mac, fewer Americans would be able to buy homes. They say that mortgage rates would be higher, as well.
  • On the other side, you have the opponents who feel that Fannie and Freddie are part of the problem — not the solution. The Home Buying Institute falls into this camp. We feel that these organizations encourage reckless lending, by removing the long-term financial burden from lenders.

Regardless of which camp you fall into, we can all agree on one thing. The system is broken. We cannot afford to spend billions of dollars a year to keep Freddie Mac and Fannie Mae on life support.

How to Sell Your House Fast in a Slow Market – A Case Study

Exclusive Report: Our editor-in-chief recently sold his home in a slow market. Within eight days, he had multiple offers for the full asking price. The home went under contract on day nine. This is the kind of home-selling success that most homeowners can only dream of right now. In this article, Brandon explains how we was able to sell his house so fast in a slow market.

Selling Your House in a Slow Market

by Brandon Cornett

Chapter 1 – Remembering the Good Old Days

In 2003, my wife and I sold our home in Maryland. Those were the days! It was a classic seller’s market. City planners had placed a limit on residential construction, so there weren’t many homes going up in our area. At the same time, there was a lot of urban “spillover” from Baltimore and Washington D.C. Long-distance commuters were moving into our part of town in droves. This high demand and low supply made it easy to sell a home fast.

Chapter 2 – Selling a House After the Recession

Fast forward five years. We lived in Texas before, during and after the housing crisis of 2008. We didn’t have a real estate bubble like California or Arizona, but we still experienced a major slowdown in market activity. For a while there, it seemed like the only houses that were selling fast were the
short sale properties. All of the regular listings were sitting on the market for months, in most cases.

We wanted to sell our house and move to Napa, California (a long story), but we were concerned about the lack of sales activity in our neighborhood. The one advantage we did have was the rapid population growth of Round Rock, Texas. As the second-fastest-growing city in the nation, our city had a steady stream of new residents and home buyers. But it was still unnerving to list the home for sale in this kind of market. So we took it very seriously.

Here’s what we did to sell the house fast in a slow market…

Chapter 3 – Let the Staging Begin

Many of the people in our neighborhood who were trying to sell their homes had failed to stage them properly. This is a big mistake when trying to sell a house in a slow market. When the inventory is higher than the demand (a buyer’s market), you have to do all you can to make your home stand out. This is where home staging and preparation come into the picture.

We put a lot of time and energy into this step of the process. The out-of-pocket cost was a little over $2,000. That might seem like a lot of money to spend on home preparation, but you’ll soon realize how well it paid off. We landscaped, cleaned, painted, de-cluttered, upgraded, staged … you name it.

Here are some of the things we did to get the house ready to show:

  • Hired landscapers to do a clean sweep of the entire yard. They removed weeds, shaped bushes, trimmed trees, put down fresh mulch, and cleaned up the flagstone path. ($1,500)
  • Painted one of our bold “accent walls” to create a more neutral living room. Painted all scrapes and scuff marks throughout the entire house. ($100)
  • Upgraded the lighting in all three bathrooms. Before this, we had those ugly “Hollywood lights” that mid-level builders often use — basically a white rectangle with naked bulbs. We installed some brushed-nickel light fixtures with frosted glass shades. This gave the bathrooms a more modern look. ($300)
  • We sanded and re-stained the front door. The door faces west, so it had been severely weathered by six years of sunsets. We also painted the iron crossbars. You can see the end result in the yard picture below. ($150)
  • We had the upstairs carpet professionally cleaned. ($150)
  • We had all of the windows cleaned inside and out. ($185)
  • We brought a Pod unit to our house, so we could pack up much of our stuff. This is a great way to de-clutter your home. We removed almost everything from closets, shelves, cabinets, etc. The house seemed larger when it was all done. Staging the home was a lot easier with all of that stuff out of the way.
  • We bought a few pieces of staging furniture for the back patio, and also for the newly created sitting area in the master bedroom. The cost is irrelevant here, because we took those items with us when we moved.

Here are some photos of the interior, after all of the staging was done:

staging the living room

staging the bedroom

office / study

Starting the previous fall, I began to get my grass into shape. This was a challenge, because we had two droughts in a row leading up to this. It’s Texas, after all. I had to de-thatch and aerate the lawn, and give it a good dose of “weed and feed.” When it came out of its winter dormancy a few weeks later, I fertilized again and began watering once a week. This picture shows how healthy the lawn was by the time we listed the home. You can hire a lawn care service to do all of this for you, if you don’t have time.

nice green grass

The above picture also shows how we staged the front porch with some brand-new rocking chairs. The people who eventually bought the house wanted the chairs too. So they obviously had the desired effect.

It bears repeating. If you want to sell your house fast in a bad market, you need to blow people away with the curb appeal. In my case, that involved the grass, the bushes, and the flagstone path that wraps around the house (among other things). Even if you don’t have grass, you have something for people to see when they visit the home. Curb appeal is extremely important. If people have a good first impression when pulling up to your house, they’ll take that impression inside with them. The reverse is true, as well.

Chapter 4 – Pricing the Home

This is where a lot of homeowners fall on their faces, and it can kill your chances of selling the house. You have to price your home based on its value in the current market. Forget about what you paid five, seven or ten years ago. That number is irrelevant. Realistic pricing is always important when selling, but especially when you’re trying to sell in a slow market.

To set the asking price for our house, we looked at the recent sales data for our area. We weren’t too concerned with listing prices — we wanted to know what homes were actually selling for in our neighborhood. We reviewed data for the previous six months, with a special focus on the more recent sales. To be honest, we could have priced it higher and still brought in buyers. But we were trying to sell it fast in a slow market. So we erred on the more conservative side. We wanted people to see it as a true value, so we could avoid all of the price haggling. It worked.

Chapter 5 – Marketing the Home

If you want to sell your home fast, you need to put it in front of the largest possible audience. The easiest ways to do this are to (A) list it on the Multiple Listing Service and (B) put it on There are plenty of other ways to market your house. But these two methods will put in front of thousands of buyers, virtually overnight. We did this, and we also put it on

The more pictures you can include with your listing, the better. This helps you in two ways. First, it helps you weed out the buyers who simply won’t like your house — and there will always be such buyers. You don’t want to waste your time showing the property to people who are looking for something different. So be transparent from the start. Use plenty of pictures. This also helps you create interest among buyers who are seeking a house like yours. We took about 20 pictures of the house, inside and out. This allowed us to show off the home staging and curb appeal we worked so hard on.

We also created a flyer that people could pick up as they walked into the house. It pointed out some of the features they might not have noticed otherwise. Examples: The downstairs is wired for sound, with two speaker locations in the kitchen and entryway. The surround system in the media room conveys with the property. The pool is a saltwater pool, which is easier on the skin and eyes than regular chlorine. You get the idea. Don’t assume that people will know these sorts of things — tell them! To sell your house fast in a slow market, you have to convey everything that’s great about your home. And I mean everything.

Chapter 6 – Success!

So, was all of this effort worthwhile? I think so. But I’ll let the results speak for themselves. Within eight days of listing the home, we had multiple / competing offers for the full asking price. We accepted one of the offers the very next day.

We were also able to choose our buyers, which is a big deal. We chose the buyers with the strongest financial picture. It’s common for buyers to lose their financing at the last minute, as the result of some extra scrutiny on the lender’s part. This was a major concern for us. So we went with the buyers who seemed to have their ducks in a row.

Planning to sell your house in 2011?

Our success can be attributed to the three P’s of home selling. Price, preparation and promotion. We realized the importance of these things in the beginning, and we worked hard to get them right. We priced the home realistically. We prepared it well. And we promoted it through high-visibility channels. Two out of three is not good enough. You need to get all three of these things right.

So there you have it. How to sell your house fast in a slow market. It worked for us!

In Round Rock, Texas, Real Estate Values Bring Growth

Austin, TX – U.S. Housing News — Every few years, a little-known city or town will start to get national attention, followed by rapid growth. Someone in the media will “discover” the place and write about it favorably. This puts it on the radar of folks who are looking to relocate. And before you know it, you have a population bubble. Such is the case with the Round Rock, Texas real estate market, as of 2010.

Couple in neighborhoodIn July of 2009, the Census Bureau reported that Round Rock, Texas was the second-fastest growing city in the United States. New Orleans was #1 in terms of growth, but that city is in a different category altogether.

So you could say that out of all the cities in the U.S. that didn’t suffer a hurricane-fueled exodus, Round Rock is the fastest growing.

Rankings aside, we are talking about some serious growth. The population of Round Rock grew by 8.16% from 2007 to 2008, and the rate of growth has slowed only slightly in subsequent years.

So what’s driving this growth, and how does it affect the Round Rock real estate market? These are questions worth asking, because they make for a good case study in housing markets and population trends. Here are some of the factors that are attracting people to this Central Texas location:

Round Rock at a Glance

Home prices. By and large, Texas avoided the housing bubble that recently burst over the rest of the United States. From the late 90s to the early 2000s, much of the country was swept up by housing mania. Fueled by speculation (and a touch of lunacy), home prices shot up across the nation. But not so in Round Rock, Texas. Appreciation in that city could be described as slow and steady. As a result, the Round Rock real estate market is one of the most affordable in the country. For now, at least.

Bedroom community. Round Rock is located about 15 miles north of Austin, the state capital and the Live Music Capital of the World. And Austin has plenty to offer, from restaurants to recreation. Homeowners in Round Rock have the convenience of living close to Austin, without the cost of living in the city.

Infrastructure. It recently got a lot easier to drive to Austin from Round Rock. In fact, you don’t even have to drive. A brand-new MetroRail began running in March of 2010, and it links Austin to several stations located near Round Rock. Several new toll roads have also made north-and-south transportation a lot easier.

Media. In 2008, Money magazine listed Round Rock as the seventh-best American small city in which to live. In March 2010, Forbes magazine published a list of ten cities where the recession is easing the most. The Austin / Round Rock metro area tied for first place, along with the Washington DC.

This kind of coverage has put the city on the radar of relocation-minded people from all over the United States (especially Californians who cashed out before and during the bust).

Family Friendly. This phrase gets tossed around quite a bit in marketing pieces, but Round Rock truly measures up. The city offers solid schools, plenty of parks and rec, and one of the lowest crime rates in the country.

Attention home buyers: If you have questions about buying real estate in Round Rock, Texas, you can visit our main website. There, you’ll find hundreds of tutorials on the home-buying process.

How to Sell a House in 2010 – Special Report

Austin, TX – U.S. Housing News — It’s a buyer’s market in most cities across the country. So if you want to sell your house, you need to go the extra mile. You can start by focusing on the three P’s of home selling.

Reader Question: “I’m trying to sell my house, but it’s been on the market for a long time. A few people have looked at it so far, but only one person made an offer. That deal fell through because the buyer could not get their financing. Now the home is back on the market. How do I sell my house quickly in this kind of economy?”

soldThis is a common question among homeowners right now, and it’s easy to understand why. Housing inventories are high, buyers are having trouble getting loans, and foreclosures are dragging down property values. This is the recipe for a buyer’s market, and that’s exactly what we are seeing in most cities across the United States.

So let’s revisit the question at hand. What does it take to sell a home in this kind of environment? What steps must a homeowner take to get it right? In short, you must go through the same steps that have always worked. You just have to do them better. This is what separates the houses that sell quickly from those that stay on the market for months.

But let’s get specific. Here’s how to sell a house in a buyer’s market.

Pricing, Prepping and Promoting – The Three P’s

When a person can’t sell a house, it’s usually due to one of the following reasons. Let’s call them the three P’s.

1. Pricing — If the home is priced too high based on current market values, it will be less likely to sell. This is one of the biggest mistakes sellers are making right now, and it has a lot to do with our economic downturn. Home values have declined over the last few years, in almost every city in America. But some homeowners don’t realize this, so they base their asking price on the amount they paid for the house a few years ago. Others homeowners are simply in denial and refuse to accept the market reality. Either way, it leads to an overpricing situation. And that’s the number-one reason why homes don’t sell.

You (or your agent) should review comparable sales in the area for the last three months. This will tell you what people are willing to pay for your house. Buyers today are more savvy about listing prices, and they’re on the lookout for overpriced properties. Some will make a reduced offer for such a home — others will dismiss it entirely. This is not the kind of scenario you want. If you want to sell your house in a buyer’s market, you need to price it accordingly.

2. Prepping — Up the street from where I live, there’s a home for sale. The sign on the yard says “Priced to Sell.” The house has been on the market for about eight months now. It might be priced to sell, but it’s clearly not prepared for the market. The front yard is a jungle. The shutters are in desperate need of a paint job. And based on what a local agent has told me, the inside is just as bad — outdated, ill prepared, and unimpressive.

Pricing is the most important factor when selling a house, but preparation comes in second. If you want to sell a house in a buyer’s market, you need to make it outshine similar homes for sale. This means staging, painting, cleaning, landscaping, and updating the fixtures and features. Compare these small expenses to the extra mortgage payments you’ll make if it doesn’t sell, and the path becomes clear.

3. Promoting — Let’s assume you’ve set a realistic asking price, and you’ve worked hard to make the home look its best. What’s next? Now is the time for marketing. You must promote the home in every way possible, in order to bring in qualified buyers.

Remember, there are fewer buyers right now, as a result of soaring unemployment and tighter lending standards. Your audience has shrunk. This means you must market the home more effectively, to bring in as many buyers as possible. At a minimum, you should list the house on the Multiple Listing Service (MLS). You should also put it on at least one of the big real estate listing websites. It helps to have a yard sign too — simple but effective.

Old advice … with a new twist. The three P’s have always been important when selling a house. But in a buyer’s market such as 2010, you have to go the extra mile in all three areas. You must price the home competitively, prepare it for the market, and then promote the heck out of it. This will bring in the highest number of buyers, which is the first step to getting an offer. This is how to sell a house in a buyer’s market.

How to Sell a House in 2010 – Lessons from the Field

You can learn a lot from the folks who deal with these challenges for a living. Here’s what real estate agents across the country are saying about this subject:

  • San Antonio real estate agent Matt Stigliano reiterates the pricing point: “A bad price can label a home with the dreaded ‘overpriced’ stigma very quickly — and that stigma is hard to wash off.”
  • Joe Manausa, a Tallahassee real estate broker for Century 21, talks about the importance of online visibility: “To successfully market a home on the internet, the home must be positioned on a highly trafficked real estate web site where … home buyers are shopping.”
  • The folks at McMillin Realty also stress the importance of property photos: “The more photos of your home are associated with the listing, the longer time buyers will spend looking, and they will be more likely to come see your home.”
  • 512 Developing, an Austin home builder, explains how shoppers become more picky in a slower market: “In a transition from a sellers to a buyers market, buyers become much more sensitive to things like dated light fixtures and other things that you might over look.”