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Family Style Mardi Gras on Gulf Coast

by The Pat Wattam Team

Everyone knows what kind of Mardi Gras parades we have in Baton Rouge and New Orleans, but this was my first experience in Orange Beach, AL.  Went to two parades that went right in front of our condo on the beach.  Very family friendly, couple of marching bands, several live bands from blues to rock 'n roll on floats, and lots of beads!  Check out my video!

Is This the RIGHT Time to Buy?

by The Pat Wattam Team

Gary Keller made an excellent observation in his book "Shift" when he remarked, "The moment the media declares a "real estate shift,", it's as if the Market just got doused in a cold shower.  The result is fearful buyers, pickier buyers, and eventually fewer buyers.  Cautious consumers appear willing to let good deals die and great opportunities pass them by in hopes of getting a steal -  they start missing the forest for the trees.  Wary of paying too much, buyers go too far and begin to offer too little...."  The problem for most buyers is - who can you trust?  The media hype that the real estate market is a bust is only true in certain areas of the country.  Real Estate is so local, you can't just generalize it across the country.

Can a buyer trust a real estate agent to guide them to make a wise decision??  We hope so.  Too many buyers ARE missing out on a great deal - THE INTEREST RATES!!  THE TAX CREDIT!!  As noted in The Advocate this week, the Baton Rouge market continues to increase in value - making us one of the top rated real estate markets in the country.  What is to prevent us from having the crash that Miami, Phoenix, and California experienced?  First off, those markets sky rocketed upward so fast it was just unbelievable!  I know agents in those markets and there were no houses to be found, people were paying $600,000 for a house and then tearing it down to build new!!  The Greater Baton Rouge Real Estate market NEVER experienced that - including during Kartina.  Our market has corrected itself since then, but buyers seem to still be reluctant to believe that they can't 'steal' a good house.  Just recently I sold two properties - one in the upper $200's and one in the $400K range, the first week on the market - with multiple offers.  Both were good houses, priced well, but we had buyers make crazy offers on them, and then were disappointed when someone else ended up with the home of their dreams.

We tell the buyers we work with, if you like this house and think it's good, why do you think there is not anybody but you thinking the same thing!  When you find the house you want to live in, then make a serious offer and get the house!!!  Take advantage of these fabulous interest rates!!  Have your Realtor run the latest market analysis of the area to show you the value of the house.  For the Greater Baton Rouge area, sellers are negotiating an average of less than 3% off the list price of a house!!!!  Understand this when you put in an offer!

This is one of the best opportunities to own a home in the Great Baton Rouge market.  Call us and WE'LL GUIDE YOU to find the perfect home for you!

 

What the Economic Stimulus Plan Means to You

by The Pat Wattam Team

The Economic Stimulus Package directed at First Time Home Buyers could be a real factor on moving the Great Baton Rouge Real Estate Market.  If we can get the first time home buyers back in the market with some added incentives to buy NOW, then that will help the move up buyer also.  It relaly is a domino effect - the first time home buyer buys your home, then you have the ability to take advantage of these great interest rates to buy your move up house!! 

The tax credit idea is a great one - although you have to wait until you do your taxes next year to really enjoy the benefit as fas as cash in your pocket - and since most people stay in their homes at least 3 years, more than likely it is money that won't need to be paid back!!!  To read all about it, continue below:

Tax Credit for Homebuyers
First-time homebuyers who purchase homes from the start of the year until the end of November 2009 may be eligible for the lower of an $8,000 or 10% of the value of the home tax credit. Remember a tax credit is very different than a tax deduction – a tax credit is equivalent to money in your hand, as opposed to a tax deduction which only reduces your taxable income.

The tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit if they sell their homes within three years.

Tax Credit Versus Tax Deduction

It’s important to remember that the $8,000 tax credit is just that… a tax credit. The benefit of a tax credit is that it’s a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a homebuyer were to owe $8,000 in income taxes and would qualify for the $8,000 tax credit, they would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a homebuyer is liable for $4,000 in income tax, he can offset that $4,000 with half of the tax credit… and still receive a check for the remaining $4,000!

Phaseout Examples

According to the plan, the tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000.

To break down what this phaseout means to homebuyers who are over those amounts, the National Association of Homebuilders (NAHB) offers the following examples:

Example 1: Assume that a married couple has a modified adjusted gross income of $160,000. The applicable phaseout to qualify for the tax credit is $150,000, and the couple is $10,000 over this amount. Dividing $10,000 by $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time homebuyer tax credit that is available to this couple, multiply $8,000 by 0.5. The result is $4,000.

Example 2: Assume that an individual homebuyer has a modified adjusted gross income of $88,000. The buyer’s income exceeds $75,000 by $13,000. Dividing $13,000 by $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $8,000 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,800.

Remember, these are general examples. You should always consult your tax advisor for information relating to your specific circumstances.

Homes that Qualify

The tax credit is applicable to any home that will be used as a principle residence. Based on that guideline, qualifying homes include single-family detached homes, as well as attached homes such as townhouses and condominiums. In addition, manufactured or homes and houseboats used for principle residence also qualify.


Higher Loan Amounts

More good news – there is an extension on the additional tier of conforming loan amounts which had been first established in 2008.  This tier of home loans are those greater than $417,000, and with a maximum that depends on the area, but is not greater than $729,750.  These loans will again be eligible for rates that are slightly higher than conforming loan rates, but less expensive than the standard “jumbo” loan rates.

Additional Housing-Related Provisions

Tax Incentives to Spur Energy Savings and Green Jobs — This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.

Landmark Energy Savings — This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.

Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing—This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs.Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8) to increase energy efficiency, including new insulation, windows, and frames.

Expanding Housing Assistance—This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.

More Help for Homeowners in the Future
Another thing to keep an eye on in the coming weeks is President Obama’s plan to help struggling borrowers before they are faced with a default on their mortgage.

According to reports, the Obama administration is discussing plans to help borrowers who are struggling to stay afloat, but who have not yet fallen behind on their payments. At this point, details are scarce; however, reports indicate that President Obama is looking to spend approximately $50 Billion to directly help homeowners before they face foreclosure and financial disaster.

While this is good news for individual homeowners, it will likely be good for the housing industry as a whole. That’s because, assisting struggling borrowers before they default should help stop the wave of foreclosures, which are estimated to top two million this year. That, in turn, will help stabilize home prices.

The Economic Stimulus Plan is huge, and impacts a number of industries. I’ve highlighted some of the major provisions that may impact you now and in the future.

As always, if you have any questions or would like to discuss how this may specifically impact you, I’d be happy to sit down with you. Just call or email me to set up an appointment.

 

January 2009 Market Stats

by The Pat Wattam Team

We are going to closely watch our real estate Market this year to make sure it doesn't make a drastic change that we don't catch!  Running the January statistics for East Baton Rouge, Ascension, and Livingston parishes combines we see that the sales volume and number of sales are down almost 25%.  That's a trend we have seen since hurricane Gustav last fall.  There were 357 closed sales in January 2009 compared to 468 in January 2008.  The one thing I keep noticing is that the Days on Market is getting longer - in January 208 DOM was 97 but this year it was 107 - not a significant change but something to watch.  We are not in a buyer's market nor are we in a seller's market at this point. 

The other thing I see is that houses that are in top condition and priced aggressively are the ones that are selling.  We also see a lot of buyers trying to buy a house contingent upon them selling their house (and they haven't even put their house on the market!!) and that is just not working here.  Sellers are not going to take thier house off the market in hopes someone else is able to find a buyers for their house.  It's too much risk at this time.

The market is heating up and we are seeing lots of buyers out looking now that we keep getting these days with 70 degree, sunny weather!  Don't we just love living in Louisiana - especially this time of year!!

 

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Pat Wattam
RE/MAX First, Independently Owned and Operated
4750 Sherwood Common
Baton Rouge LA 70816
Office Direct: 225-298-6900
Office Main: 225-291-1234
Fax: 225-295-1234

RE/MAX First
Each Office Independently Owned and Operated
Main: 225-291-1234

Licensed by the Louisiana Real Estate Commission