I have put together 5 key points for home buyers to begin to do to start the year off right to ensure their ability to be a homeowner in 2012.

Like many homebuyers, you sat on the sidelines for the past few years — watching the real estate market go from boom to bust — and now you’re just about ready to jump in.

What renter wouldn’t be at least toying with the idea of homeownership, with interest rates well below 5 percent andhome prices having dropped more than 20 percent in many areas of the country?

But just because conditions have tipped in favor of homebuyers doesn’t mean you should run out and snatch up the first “great deal” you come across. Instead, if your goal is to become a homeowner in 2011, position yourself for long-term success by making these five New Year’s Resolutions for renters who are aspiring homeowners:
Resolution #1: I will come up with a meaningful down payment for the house I want to buy.

You already know that the days of no-money-down loans are largely gone. These days, lenders want to see that you have some skin in the game. That means you should be prepared to come to the table with some cash of your own.

You don’t necessarily have to come up with a 20 percent down payment. But a 5 percent or 10
percent down payment for a conventional mortgage would be nice. Even with a government-backed loan, such as an FHA loan, you’ll need to have at least a 3.5 percent down payment. The good news is that, with all your scrimping and saving, you’ll walk in the house with equity in the property.

Resolution #2: I will get my credit in the best possible shape before applying for a mortgage.

No matter where you go to get a loan, somebody’s going to check your credit rating. Ideally, you want your FICO credit score to be 700 or higher. That puts you in the running to get the best possible loan terms and interest rates. Some banks are even demanding FICO scores of 720 or 740 for the best rates. Whatever the case, you need to know where your credit stands.

Haven’t checked your credit reports recently? That’s not surprising. The National Foundation for Credit Counseling says that two-thirds of all adults in America haven’t taken a peek at their credit reports in the past year; even fewer have checked their credit scores. You can get your Equifax, Experian and TransUnion credit reports free of charge at AnnualCreditReport.com. Don’t know your FICO score either? Read this article on how to get your FICO credit score free.

Resolution #3: I will become a record-keeping guru – at least for as long as it takes to document my loan.

Documenting your application is the name of the game to get a mortgage in this credit environment, in which lenders are skittish about getting burned by borrowers who don’t repay their debts. So be prepared to fully document everything: your income, your assets, your liabilities, and even aberrations — like that mysterious (at least to your lender) $1,000 holiday gift from your rich uncle that was deposited into your checking account this month.

Resolution #4: I will consult reputable professionals for help.

Buying your first home isn’t a task best left to novices to navigate alone.  you will likely fare much better in the home-buying process if you let the pros help you in a variety of areas.

For instance, a trusted real estate broker can get you into properties in your desired area, show you market comps for homes available for sale, and draw up an offer to buy to present to a home seller. Likewise, a home inspector can point out hidden flaws and alert you to structural or environmental defects you might not see in that home, condo or townhouse you’ve fallen in love with.

Resolution #5: I will take a homeowner education course to better prepare myself for the rights and responsibilities that go along with homeownership.

Every state in the country, as well as most cities and counties, offer some kind of first-time homebuyer education program. Many of these courses take just a few hours, but you’ll be greatly enriched by them. They teach you the ins and outs of mortgages. They tell you how to spot and avoid predatory lending. And they counsel you on what to do if you run into financial trouble down the road, after you’ve bought a home.

Not only will you learn about what it takes to become – and remain – a successful homeowner over the long haul, but you may also qualify to get government-sponsored financial assistance just for taking the course. This aid is free money, often in the thousands of dollars, can be used for a down-payment or towards your closing costs.

So if you’re currently renting, any of these New Year’s resolutions will make your 2011 a great year, especially when you finally do move into the house of your dreams.

Please feel free to call Gary Giffin or reply with any questions or concerns.  I look forward to working with you in 2012.

Website contact for all your Real Estate Needs: WWW.SanDiegoHomeSold.com

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La Jolla Real Estate Sales

Jan – Aug 2011

Total Sales for August – 58

SFH Sales for August  -  24

Condo Sales for August – 29

Foreclosures for August – 6

Total Sales for the year  -  431

Total Sales over 1.5 Mil  -  87

Total Sales over 2 Mil     –  51

Total Sales over 3 Mil     –  19

Total Sales over 5 Mil      -  2

Median SFH 1990 – $640,000

Median SFH 1995 – $488,000

Median SFH 2000 – $855,000

Median SFH 2005 – $1,750,000

Median SFH 2009  -  $1,430,000

Median SFH 2010  -  $1,380,000

Median SFH 2011  -  $1,340,000

More information on buying vacation or bank owned REO’s in La Jolla visit: Gary Giffin, Middleton & Associates Real Estate.
website, www.SanDiegoHomeSold.com or San Diego Coastal Real Estate at www.SanDiegoMLSHomeSearch.com , email him, garygiff@san.rr.com

Now could be the best time in history to buy a home. Presuming, of course, you have the money and the credit to do so.

The average rate on a 30-year fixed mortgage hit record lows last week, down to 4.01%, according to Freddie Mac. The Federal Reserve’s recent “Operation Twist,” which was designed to do just this, appears to be doing the trick.

There are a lot of reasons to consider buying a home right now. The big savings on interest is just one of them — the difference between a 4% rate and a 5.5% rate on a $200,000 home loan is just shy of $200 in monthly payments and can save a homeowner more than $60,000 in interest payments across the life of the loan.

Another motivating factor could be the fact that rents remain sky-high in the U.S. right now, and in many markets it’s actually cheaper to buy a home than rent a two-bedroom apartment.

While housing might not be at a “true” bottom just yet, there are many signs it is nearing one in many markets. Housing prices rose from June to July in 17 of 20 cities tracked by the Standard & Poor’s/Case Shiller home price index. It marked the fourth straight month of rises in most U.S. cities.

That’s to say nothing of the case-by-case bargains to be had. Here are two personal stories that show the opportunities to be had in this housing market:

I live in the Washington, D.C., area and purchased a short-sale home in 2009. Although three months of back-and-forth with the bank drove my wife and me crazy, we finally closed on the property just hours before a foreclosure auction — after which my Realtor asked if I wanted to immediately re-list my home with him for about 30% more than we had just paid. I had purchased the property for a growing family and good schools, so I politely declined. But the message was clear: If you suffer through a painful distressed property purchase, you get a hefty discount for your trouble.

On the other side of the coin, my brother purchased a newly constructed home in Roanoke, Va., as his wife attended medical school at Virginia Tech. Seemed like a good idea at the time — but now he’s 40% upside down on his house and renting it for barely enough to cover the mortgage. Unfortunately, he now lives six hours away, so it’s no picnic to manage his rental. My brother recently decided he has enough stress in his life so he will list the house at slightly below market rate just to get rid of it — even if it’s going to cost him big-time. Very bad for him, but some lucky southwest Virginia family is going to get a nearly brand-new home for a heck of a deal.

I’m sure many of you have your own story to tell about the housing market. Share it with me (see below) or better yet, post it in our comments section so everyone can read and weigh in.

There are plenty of other bank-owned homes or desperate sellers that folks can pursue, with deals akin to the two listed above. But the million-dollar question, of course, is whether prospective homeowners can get a loan — and if they can, whether they want one.

After the mortgage meltdown, banks have wisely tightened lending standards . That’s as it should be, but it understandably shuts many folks out of the market. Other people have good credit but don’t have the necessary savings for higher down payments some lenders now require. That’s to say nothing of folks who perhaps could sign up for a new home but are just too uncertain about their job or retirement.

Whatever the reasons, it all adds up to a decided lack of demand in the housing market. Many factors have created great deals right now, but those factors also might just be too daunting for many to overcome right now.

I remain convinced that I made the right choice in buying my home — not because it was an “investment,” but because it’s in one of the best public school systems in the country and I now have two beautiful daughters who wouldn’t fit very comfortably in an apartment. And by the way, that two-bedroom apartment rented for only about $100 less a month than my current mortgage. Buying a home was the right thing for my family, and for my finances.

And perhaps that’s the biggest lesson of all: The best reason to buy a house is because it will become your home — not a path to profits.

By Jeff Reeves

Search for over 25,000 homes and REO’s at www.SanDiegoHomeSold.com

Plans for La Jolla Children’s Pool Lifeguard Station Remodel Moves Forward

8000 first time home buyer credit

What does that mean?  How does it apply to me and my home sale?  Should I be scared? Can it be successful?
Here are some of the facts on how you or someone you know can possibly avoid foreclosure if you are in distress or behind in your mortgage payments due to job loss, reduction in income, medical bills, job relocation, etc.

1. Definition of a short sale (wikipedia): a sale of real estate in which the sale proceeds fall short of the balance owed on the property’s loan. It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower.

2. Why would a bank agree to take less for the home than owed?  The key reason is that a short sale simply costs the lender/bank much less than a home foreclosure would.

3. How many people in the US are even affected by this?  I was recently given some numbers by a major lender that said in 2010, out of 7 homes that went to foreclosure, only 1 attempted to short sale.  1 in 7.  That means that the other 6 homeowners may not have even attempted to short sale their home.  Often times, home owners are frustrated about their inability to receive a loan modification, stop making payments, and inevitably lose the home to foreclosure.

4. Short sale vs Foreclosure on your credit. In a recent blog post I listed the time frames for qualifying for a loan after short sale, foreclosure, bankruptcy, etc.
My advice to all who are considering a short sale is to discuss it with a trusted tax professional, CPA,  etc 1st who can inform you of your state’s different laws and tax consequences.

5. Who do I call?  Call your favorite real estate agent.  It’s likely they have experience in helping sellers and buyers with the short sale process.  If they aren’t comfortable with answering your questions, ask them to refer you to one of their trusted short sale or distressed property agents in their office.  Many agents, like myself, have taken it upon ourselves to learn the ins and outs of short sales.  Our job is to help people sell and buy homes, and the reality today is, many people are underwater on their homes and no longer able to make their payments.  A short sale may be the  very best option, one that allows the seller to protect themselves from future recourse, preserve their credit score better than with a foreclosure or bankruptcy, and be able to move forward. We at Middleton & Associates Realty have hired a full time Short Sale Negotiator to help us get through the process faster and to make sure its done correctly according to the CAR laws.

Need more information to help you go to Gary’s website for Short Sale & Bank Foreclosures at :http://sandiegomlshomesearch.com/ShortSale/Foreclosur.ubr

Gary Giffin, Middleton & Associates Real Estate.
visit his website, www.SanDiegoHomeSold.com or San Diego Coastal Real Estate at www.SanDiegoMLSHomeSearch.com , email him, garygiff@san.rr.com

If conforming loan limits drop in October, more than 30,000 families in California will have to deal with higher down payments and mortgage rates and tougher loan qualification rules, the California Association of Realtors said today.

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Unless Congress steps in, the limit will drop to $625,500 from $729,950 for most places on Oct. 1. The limit establishes the maximum mortgage amount the Federal Housing Administration, Fannie Mae and Freddie Mac can buy or guarantee.

In Orange County, where the conforming loan maximum is $729,750, 13.3% of home sales would be ineligible under FHA-backed loans by C.A.R.’s calculations, and 6.2% of home sales with loans sponsored by Fannie Mae and Freddie Mac would be nixed

“Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan and require a higher down payment, increasing the monthly payment and negatively impacting housing affordability for California home buyers,” C.A.R. said in a news release.

From C.A.R. President Beth Peerce:

“By reducing the conforming loan limit, thousands of California homebuyers will be shut out of homeownership. The higher mortgage loan limits are critical to providing liquidity in today’s housing market and are essential to our housing recovery. We urge Congress to maintain the current limits and make them permanent to provide homeowners and homebuyers with affordable financing and help stabilize local housing markets.”

Last October, Congress voted to extend the higher conforming loan limits through September of this year. But the present move to wind down government support for home loans includes reducing the limits.

FYI- Bank of America is changing their loan limits to 546,000 as of July 1 ( 3 months ahead of the October 1 date)

Gary Giffin, Middleton & Associates Real Estate.
visit his website, www.SanDiegoHomeSold.com or San Diego Coastal Real Estate at www.SanDiegoMLSHomeSearch.com , email him, garygiff@san.rr.com

la jolla luxury home

Home buying can be a nerve-wracking experience. You sift through multiple properties, visit the ones that grab your interest, and then finally decide on your dream home — but there’s just one problem: it’s a fixer-upper desperately in need of some TLC.

That dilemma is not uncommon today. Perhaps the home was treated poorly by a long string of renters, the owner ignored a serious problem or key fixtures were even sold off. Whatever the case, don’t be shocked or overly disappointed. Increasingly, home buyers are faced with the prospect of buying a fixer-upper in today’s real estate market.

Often, attractively priced properties that are foreclosure sales can sometimes come with cosmetic problems that may seem huge. It is not uncommon for a homebuyer to walk through a foreclosed home and discover that the kitchen was gutted by the former owners who sold off not only the appliances, but the cabinetry to boot.

This can even turn into a real problem that could hamper obtaining financing because often missing fixtures such as toilets and sinks can render the house “unlivable” per code. Who wants to buy a home they legally cannot inhabit?

Fortunately, there’s a government loan program available that can help you with that fixer-upper you wish to purchase. The Federal Housing Administration created the 203(k) loan specifically to help homebuyers rehabilitate homes they wish to purchase to live in, but that are in disrepair. A 203(k) loan lets a qualified borrower not only finance the purchase price of the home, but also include the price of the necessary repairs to the home.

A Closer Look

Again, the goal is for the buyer to live in the home, so this is not for investors. So the types of properties that qualify for the loan are:

• Single-family dwellings up to units that house no more than four families
• The residential portion of a mixed-use property (i.e., a property that is both commercial and residential in nature)
• An existing construction that has been finished for at least one year
• A home that will be torn down, but where the foundation will still remain
• A home that will be moved to a new foundation
• FHA-approved condos

There are two types of 203(k) loans, and the one that is right for your intended property depends on how much work needs to be done.

In terms of amount, a streamlined 203(k) provides up to $35,000 that can be added to the loan to cover the improvements, in addition to the purchase price of the home. For a standard 203(k), the homeowner can borrow the purchase price of the home, plus the price of the improvements, up to 110 percent of the home’s expected value after the improvements. (And again, this is assuming you can qualify for the total loan amount.) The money for the improvements is actually put into an escrow account that is used to pay for materials and the parties being contracted to do the work to the home.

Time is an important element of 203(k) loans. You must start construction within 30 days of the close of the loan and your work must be completed within six months. This might leave you wondering: what do you do if the house isn’t habitable? With a standard 203(k), you may be able to finance up to six months’ mortgage payments so that you can afford to live somewhere else while the construction is in progress.

Another critical time element is the paperwork. FHA rehab loans can take longer to close with a lender that doesn’t have experience with them, because there is more paperwork. So to avoid those sorts of delays, make sure you work with a lending professional that is experienced with 203(k) loans.

What kind of improvements are covered? 203(k) loans support a broad range of rehab work, including painting; room additions and second story additions; decks and patios; grading and drainage; bathroom and kitchen remodels; finished attics and basements; structural changes and repairs; environmental rehab such as removing lead paint or making energy conservation improvements; roofing; flooring; and accessibility upgrades for disabled residents. But what’s not covered are major luxury upgrades, such as a swimming pool or hot tub. That said, when upgrading your bathroom, for instance, you might be able to install a whirlpool bath tub. Again, the key is to speak with an experienced 203(k) lender that is well-versed in the details of the program.

Ultimately, what does a 203(k) loan mean for you? Freedom. The freedom to choose the home that is perfect for you and that you love, even if it needs some work that you would otherwise not be able to finance. If you or anyone you know is currently home shopping, but some of the properties you’re finding need some attention, I would love to help you review your financing options. Please contact me at the information provided on this message — and happy hunting!
Contact me today to learn more.

Gary Giffin, Middleton & Associates Real Estate. If you’d like to learn more about Gary or you need help buying or selling a San Diego Property, visit his website, www.SanDiegoHomeSold.com or San Diego Coastal Real Estate at www.SanDiegoMLSHomeSearch.com , email him, garygiff@san.rr.com, or call him for an appointment at 858-401-0204

According to a recent survey from the National Association of REALTORS® (NAR), the market share of vacation- and investment-home sales held steady in 2010. Although sales volume declined with the overall market, vacation-home sales accounted for 10% of transactions last year while the portion of investment sales was 17%, both unchanged from 2009.

I am committed to keeping my community informed on market statistics that will affect their real estate investment decisions. NAR’s “2011 Investment and Vacation Home Buyers Survey” — covering existing- and new-home transactions in 2010 — revealed that foreclosure or trustee sales accounted for 17% of investment purchases and 11% of vacation-home sales in 2010, compared with 5% of primary purchases. In other words, second-home buyers purchased more distressed homes at discount than did buyers of primary residences.

Also worth noting, all-cash purchases have become prevalent in the second-home market in recent years; 59% of investment buyers paid cash in 2010, as did 36% of vacation-home buyers.

These statistics clearly indicate that there are buyers out there taking advantage of today’s market opportunities to buy second homes, either as once-in-a-lifetime investment opportunities or to make a long-desired lifestyle change. According to the survey, the median vacation-home price was $150,000 in 2010, down 11.2% from $169,000 in 2009, while the median investment-home price was $94,000, which is 10.5% below the $105,000 median in 2009.

As NAR Chief Economist Lawrence Yun explains, “The fall in home prices has opened opportunities for more families to enter the second-home market. Even if purchases are delayed due to economic circumstances, the underlying long-term demand — the desire for purchasing second homes — remains because people in their 30s and 40s will reach the prime age for buying and will drive the second-home market in coming decades as conditions permit.”

The NAR survey reveals that lifestyle factors continue to be the primary motivation for vacation-home buyers while the desire for rental income drives investment purchases. Vacation homes were more likely to be located in a rural area while investment homes were more likely to be in a suburban location.

Whether looking to buy or sell a vacation home or investment property, today’s market may be the optimal time to do so. If you’d like a closer look at second-home opportunities in our San Diego area.

Gary Giffin, Middleton & Associates Real Estate. If you’d like to learn more about Gary or you need help buying or selling a San Diego Property, visit his website, www.SanDiegoHomeSold.com or San Diego Coastal Real Estate at www.SanDiegoMLSHomeSearch.com , email him, garygiff@san.rr.com, or call him for an appointment at 858-401-0204