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The Kirkpatrick Team

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The Kirkpatrick Team

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Department of Veterans Affairs Protects Our Veterans

(Published on - 6/16/2018 10:13:38 PM)

The U.S. Department of Veterans Affairs announced it is implementing a new policy that will help protect veterans from predatory lending practices.

 

 

 

The VA announced it is implementing the May 2018 Economic Growth, Regulatory Relief and Consumer Protection Act to protect veterans from loan churning when obtaining a VA guaranteed refinance loan.

 

The VA explained the act will protect veterans and service members from the dangers associated with repeatedly refinancing their home loans, requiring, among other things, the seasoning of the original loan and a recoupment period for fees, closing costs and expenses related to the refinance.

 

“We want to ensure veterans have the informed ability to take advantage of economic opportunities and make sound decisions that enable them to prosper when using their benefits,” Acting VA Secretary Peter O’Rourke said. “This is yet another tool that will help Veterans meet their personal goals.”

 

The new policy will also require a specified interest rate decrease and for protections surrounding loan-to-value ratios. If a refinance does not meet these requirements, the VA will not guarantee the loan.

 

This is just the latest step in the recent crackdown against predatory lending. The VA recently implemented a policy where lenders are required to provide borrowers a comparison of their existing VA-backed home loan to the proposed one when refinancing to ensure borrowers are set up for success. This is also referred to as a recoupment or break-even analysis, which helps Veteran borrowers clearly understand the costs of refinancing, the monthly payment savings, and the overall impact on their finances.

 

In the second half of last year, Ginnie Mae announced that it was launching an investigation into mortgage lenders that were aggressively targeting service members and military veterans for quick and potentially risky refinances of their mortgages.

 

Then, early this year, Ginnie Mae announced that it was warning a “small number” of lenders to get their VA refinance programs under control, or they will no longer be allowed to participate in Ginnie Mae multi-issuer mortgage-backed securities. Since then, Ginnie Mae has asked several VA lenders to not be a part of their VA programs.

 

Have a great day,


Chris and Dawn




STAT, Rent Check and other ARMLS stats have been published.

(Published on - 6/6/2018 8:50:07 PM)

What is happening to real esate, rent, building? Let's find out.

 

STAT and Rent Check are our market-wide reports produced each month featuring exclusive commentary by Tom Ruff: 

 

In 1557, an English estate agent (a precursor to the modern day real estate agent) by the name of Thomas Tusser compiled a collection of writings called “Five Hundred Points of Good Husbandry” which contained the following couplet:

 

“Sweet April Showers Do Spring May Flowers”

 

Okay, Tusser was not a real estate agent. He was probably a farmer (albeit a gentleman farmer). Nonetheless, if Tusser had been in real estate he would have eloquently de ned the seasonality of our market.

 

The number of pending contracts historically hits its annual peak in the last week of April. Just as the Tusser Theory of Seasonality would suggest, peak pending contract numbers in April translate into higher sales volume in May and June. In fact, the highest sales volume has appeared in either May or June in 13 out of the 17 years ARMLS has been reporting sales volume. The highest month for sales volume last year was May when 9,641 sales were reported. The four years where May or June did not rule clearly had no respect for Tusser’s theories or his poetry. Plus, they were closely associated with either the bubble forming or collapsing.

 

The number of pending contracts this year peaked on April 25. This will most likely be the high-water mark for 2018. Remember that historically, the top four months for writing contracts are February, March, April and May. The top four months for closings are March, April, May and June. Glancing at the thermometer and seeing temperatures 100+ can mean only one thing; our peak season is coming to a close. Each year it amazes me how long it seems to take for our peak selling/buying season to arrive, and then in turn, how quickly it passes.

 

As purchase contracts begin their annual descent, closed contracts are just now approaching their annual peak, commonly called pay day. April reported 8,990 sales, a 3.7% increase over last year. It should be noted that even though there was a 3.7% year-over-year increase, there were 21 business days this year compared to only 20 in 2017. Viewing sales on a business day basis, there were 433 sales per day in 2017 compared to 428 this year. We saw an 8.5% increase in the year-over-year median sales price. If prices continue to rise at accelerated rates, eventually supply will increase and demand will weaken. Could the April sales volume be the rst indication of this predictable drop in demand? As we’ve often said, one month does not constitute a trend and the April daily volume shows only a modest drop. So what do the April sales volume numbers mean? They mean we’ll be keeping a much closer eye on May and June.

 

Now let’s turn to total dollar volumes. With a 10.2% yearly increase in the average sales price coupled with the 3.7% increase in volume, the total April sales dollar volume was impressive. Subscribers in April saw their total sale dollars increase 14.3% over last year. Even better news, ARMLS subscribers are o to their best start in history with nearly $10 billion in sales through the rst four months of 2018. With its $9.9 billion in reported dollar sales, the rst four months of 2018 registered as the best start in the history of ARMLS. Nothing feels as good as being number 1.

 

Download STAT APRIL 2018 (PDF)

Download RENT CHECK (PDF)

 

Have a great day. 

 

Chris and Dawn

 

 


Real Estate and Tax Cuts and Jobs Act of 2017

(Published on - 5/18/2018 9:13:55 PM)

 

The Tax Cuts and Jobs Act of 2017 will have an impact on many different industries for the 2018 tax year, including the real estate industry. Along with the changes coming about, there is bound to be a bit of confusion. Luckily, the IRS has recently clarified the changes being made to the Home Equity Loan Tax Deduction, one of the most misunderstood portions of the new tax law.

 

 

This portion of the tax law states that the “deduction of interest paid on home equity lines of credit and home equity loans except when the funds are used to substantially improve the taxpayer’s home”, however the IRS recently clarified that the deduction is not being removed, only can now be taken under “new home improvement restrictions."

 

This clarification states “despite newly-enacted restrictions on home mortgages, taxpayers can often still deduct interest on a home equity loan, home equity line of credit (HELOC) or second mortgage, regardless of how the loan is labelled."

 

The requirements of taking this deduction remain that the home being financed must be used as a primary or second home and the line of credit cannot surpass the cost of the home. This is great news for anyone looking to use a home equity loan or line of credit in order to make improvements on their main or secondary home.

 

 

The real estate industry as whole is pleased with the clarification made regarding this deduction and if you need additional information on how the Tax Cuts and Jobs Act of 2017 may impact your home purchasing or renovating, please don’t hesitate to contact Dawn or I. We’ll try to make as much sense of it as we can together. It is, afterall, tax code.

 

 

Our job is to help you get or keep you in the home of your dreams in the Scottsdale area.

 

Have a great day,


Chris and Dawn




Is Arizona Real Estate Sizzlin'?

(Published on - 5/3/2018 4:24:58 AM)

 

2017 was a good year fro the housing market for homebuilders. In fact, we saw higher home sales, prices and agents out in the market place making deals. 

 

The Valley saw an increase in both new home and resale homes over 2016, though there was a limited resale inventory. However, the trends say resales homes were up 7% in December of 2017.

 

Not only have we seen an increase in the market, but we have also seen an increase in buyer seeking to capitalize on the hot market. Let's face it, our area is somewhere people want to be. 

 

There was also an increas in agents in the area. A positive sales year, always encourages people to get their Real Estate license. 

 

Can there be too many agents in an area? 

 

HomeSmart International thinks not, mainly because the trend hasn’t been seen in other markets.

 

For instance, markets like California that entered the downturn earlier (in 2010 or 2011) than Arizona recovered first and are now ahead in market growth. They have yet to see any indication of agents requesting higher commissions.

 

According to Wendy Forsythe, COO of HomeSmart “This may be because, from a seller’s perspective, limited inventory means properties sell faster, requiring less time, effort and expense from an agent.”

 

2018 is on track to be a healthy year as far as the market is concerned.

Let's face it, it is still the American dream to purchase and own your own house. People will always strive to achieve this.

 

We'd love to be the agents to help them accomplish this.

 

Have a great day.

 

Chris and Dawn

 

 


How is Renting in Phoenix?

(Published on - 4/20/2018 5:46:52 PM)

Rent is high in the Phoenix, Arizona area!

 

According to a study from www.azcentral.com, Phoenix is the 9th more unaffordable city to live in for renters in the US.

 

Workers in the Valley are having a tough time stretching their wages to pay rent. According to this study the average person or family than rents, must use up a week and half to two weeks of their monthly paycheck to pay rent.

 

You might be wondering what kind of places are they renting? They might need to downsize. This statistic is generally based on them renting a typical one-bedroom apartment, according to SmartAsset.

 

So this means they are working the most hours they can in order to affording a living space.

 

This brings me to the discussion of owning vs. renting.

 

 

Owning and renting both have their advantages, but what’s best for you depends on your current circumstances. Owning a home is a financial commitment.

 

Here are some of the benefits of both. As a Realtor, we tend to have more people buy than rent but situations sometimes don’t fit for buying right then.

 

Renting

You pay less up front.

While many landlords ask for first and last month’s rent and security deposit, it is still less than a down payment.

 

Repairs are less.

You may not be able to decorate or personalize your living space as you’d do if you owned it. However, repairs are generally less expensive as your landlord will generally fix things for you.

 

Costs may increase.

Your rent may go up in the future depending on your landlord or market trends.

 

Relocating can be easier.

You don’t have to worry about selling a home if you need to move. Making your life more flexible to move in case of a new job, etc.

 

Owning

Better terms.

Most mortgages require a down payment and with more money down you generally get lower monthly payments.

You also need to pay closing costs.

 

Decorate!

You can update your home with renovations, decorations and personalize it to make it your own. The downside, repairs and maintenance cost you directly.

 

Home Values Fluctuate.

Depending on the market, home values can rise and fall over time.

 

Equity.

You may build equity in a home (market value minus what you owe), which can increase your assets.

 

If you live in the Phoenix area and would like to consider the possibility of owning, we’d love to walk you through the process.

 

Have a great day.



Chris and Dawn

 


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