Massachusetts Home Buyer Guide

Trump Watch: Is 'The Donald' Coming to Boston?

For those of you who can't get enough of "The Donald," the latest news is that Donald Trump's company might be considering the purchase of one or more Boston properties, the Boston Herald reported August 31, 2007.

Donald Trump, Jr. has had a number of meetings in Boston with local real estate developers. Junior is executive vice president of development and acquisitions for his dad's company.

A Trump spokesperson confirmed to the Herald that Trump's company had "explored most of the high-end properties on the market," but "It’s very, very early in the process.”

Read The Boston Herald Article

Mortgage Applications Fall Second Straight Week

U.S. mortgage applications fell for the second straight week, declining 4 percent compared to the previous week, USA Today reported August 29, 2007; however, mortgage applications were 10.5 percent higher then the same period last year.

The Mortgage Bankers Association provided the data.

The four-week moving average, a statistic that smooths out the week-to-week volatility, showed mortgage applications were up 0.3 percent.

"A sharp rise in defaults in the subprime mortgage market, which caters to borrowers with poor credit histories, has caused lenders to tighten requirements, making it difficult for those with weak credit to get a home loan."

Read The USA Today Article

U.S. Existing Home Sales, Prices Decline

Existing home sales across America have declined for the fifth straight month in July and home prices have dropped for a record 12th straight month, USA Today reported August 27, 2007.

The National Association of REALTORS provided the data, which indicated a 0.2 percent drop in home sales compared to June 2007 and a 0.6 percent drop in home prices in July compared to a year ago.

"The deep slump in housing, combined with recent severe turmoil in financial markets, has raised worries about a possible recession. But many economists believe the Federal Reserve will ward off a full-blown downturn by reducing a key short-term interest rate if financial market conditions fail to stabilize."

Sales fell 2.2 percent in the Midwest and were unchanged in the South. Sales rose 1.8 percent in the West and 1 percent in the Northeast.

"The increase in the Northeast, which also saw the median home price increase, was seen as possibly hopeful sign that the worst of the housing downturn may be ending."

Across the nation the inventory of unsold homes rose 5.1 percent at the end of July to a record of 4.59 million units.

Read The USA Today Article

Your Credit Score More Important Than Ever

It's not news to anyone that maintaining a respectable credit score is vital to obtaining a home loan and a competitive mortgage interest rate.

What's respectable in the current lending environment may be news to many consumers.

According to an August 26, 2007 article in the Boston Herald, underwriting standards adopted by various lenders have increased the minimum credit score necessary to stay out of the subprime lending pool.

A minimum credit score of 620 had been the typical cutoff point between a traditional loan and a subprime loan; however, some lenders now are requiring minimum scores of 680, a significant increase. For limited documentation loans, some lenders are requiring a credit score of at least 720.

Mortgage brokers I speak with regularly have been telling me for months that underwriting standards literally have been changing on a daily basis, and many loan programs are no longer available.

Read The Boston Herald Article

U.S. New Homes See Surprise Gain, Prices Down

According to Commerce Department data, sales of new homes in the United States rose 2.8 percent in July, CNN Money reported August 24, 2007.

Prices were down 3.4 percent in July compared to July 2006.

"Even with the unexpected rise, the pace of sales only looked good by comparison to very weak sales seen so far this year. The pace of sales is still off 10.2 percent from year-ago levels, and the July sales pace would have been lower than any monthly reading seen from October 2001 through January of this year."

You also can watch this Fox News video about the increase in new home sales.

Read This CNN Money Article

Nobody Told NYC About The Housing Slump

While many, but not all, of the country's real estate markets struggle, apparently no one has informed the folks in New York City.

This Fox News video reports on the booming New York City real estate market.

Home Construction At Slowest Pace In More Than A Decade

The pace of new home construction fell in July to its slowest rate in more than 10 years, the Boston Herald reported August 16, 2007.

The U.S. Commerce Department reported the data and said that construction of new homes and apartments dropped by 6.1 percent in July compared to June to an annual rate of 1.38 million units. The July 2007 pace was down 20.9 percent from July 2006 and represented the slowest construction pace since January 1997.

The National Association of Home Builders confidence survey fell to 22 in early August, the lowest point since January 1991, when the country was going through another severe downturn in housing.

Read The Boston Herald Article

U.S. Existing Home Sales Fall In 2nd Quarter

U.S. existing home sales fell 11 percent in the second quarter compared to the second quarter in 2006, the Associated Press reported August 15, 2007.

"Nationwide median home prices dropped 1.5 percent to $223,800 from $227,100 in the same quarter last year. The median price is the point at which half the homes sold for more and half for less."

The data came from the National Association of REALTORS® (NAR). The REALTOR® group's data also showed that the San Francisco Bay Area was the most expensive region of the country, with median prices of $865,000 for San Jose and $846,000 for San Francisco.

Bucking the national trend, the Salt Lake City and Binghamton, N.Y. areas actually saw price gains of nearly 20 percent for single-family homes. On the other hand, the Elmira, N.Y. and Melbourne, FL areas had price declines of 15 percent or more.

Read The Associated Press Article

Mortgage Crisis Not Only Hurting Home Buyers

Potential home buyers faced with tighten lending standards and fewer home loan programs are not the only people feeling the pain as a result of the recent mortgage crisis.

Just since the first of the year, more than 38,000 employees have lost their jobs at lending institutions across the nation, the Boston Herald reported August 22, 2007.

"Meanwhile, construction companies have announced nearly 20,000 job cuts this year, while the National Association of Realtors expects membership rolls to decline this year for the first time in a decade."

Read The Herald Article

The Foreclosure Pain Continues

Foreclosures across the United States rose 93 percent in July compared to July 2006 and increased 9 percent compared to June 2007, the Houston Chronicle reported August 21, 2007.

"There were 179,599 foreclosure filings reported during July, up from 92,845 during the same period a year ago, Irvine-based RealtyTrac, Inc. said today. There were 164,644 foreclosure filings reported in June."

The above numbers translate into one foreclosure for every 693 American households.

Foreclosures increased in 43 states on a year-over-year basis in July, but five states — California, Florida, Michigan, Ohio and Georgia — accounted for more than half of the nation's total foreclosure filings.

According to RealtyTrac, Inc., Massachusetts ranks 9th in the country in foreclosures. New Hampshire ranks 34th and actually saw a decline in foreclosures in July 2007 compared to June 2007. One in every 580 Massachusetts household faced foreclosure.  One in every 2,946 households in New Hampshire faced foreclosure.