The Top Considerations for Buying a Home in Marin in 2010Posted by Lisa Mallon on Saturday, December 26th, 2009 at 10:30am.
By all accounts, 2010 is the year to buy a house. Here in Marin, home values have diminished to 2003 levels, fixed mortgage rates are sitting near record lows, and the foreclosure epidemic has created some amazing opportunities for bargain hunters. Adding to this golden window of opportunity are the thousands of dollars in tax credits to nearly all first-time buyers and the bulk of existing home owners who close a purchase by June.
With that said, here are the top considerations (in my opinion) if you are looking to buy a home in Marin in 2010.
1. Home buyers need a stable income stream from employment.
2. Prices to bottom out: After more than three years of falling, real estate values have shown signs of stabilization in recent months and economists are in agreement that home prices will hit bottom by the third quarter of 2010. Although this is a national forecast, the pricing trend in Marin has followed this path albeit not quite as dramatic across most communities in our county.
3. Mortgage delinquencies up: Despite the highest delinquency rate in the 37-year history of the Mortgage Bankers Association's National Delinquency Survey, increased unemployment numbers are expected to drive delinquencies even higher in 2010.
4. Foreclosures move upstream: The number of foreclosure sales nationally will increase to about 1.9 million in 2010 and there is expected to be a dramatic increase of foreclosures from prime borrowers - many of those in more expensive neighborhoods at higher price points.
5. Mortgage rates to rise: The Federal Reserve program, first announced in November of 2008, that mortgage-backed securities from Fannie Mae and Freddie Mac are set to expire at the end of the first quarter of 2010, and if private investors don't step up, fixed mortgage rates could jump. The Federal Reserve could decide to extend the program but has not as of this date. The expiration of this program, the improving economy, and mounting concern over government deficits could push rates higher by the end of 2010.
6. Buyer's market remains: With prices still falling, mortgage rates remaining historically attractive, and additional homes hitting the market in the form of foreclosures, the dynamics of the real estate market will continue to favor buyers over sellers in 2010.
7. FHA lending standards may increase: While banks have increased lending standards in the face of mounting delinquencies, mortgages backed by the Federal Housing Administration--which come with a minimum down payment of just 3.5 percent--have remained accessible to a wide range of borrowers. In early December, the Department of Housing and Urban Development announced that it would make several changes to FHA mortgage requirements: raising up-front cash requirements, boosting minimum credit scores, and is contemplating charging more for insurance premiums. These developments could work to choke off the supply of mortgage credit to borrowers who can't get financing elsewhere.
8. Tax credit available through June: On top of lower prices and cheap mortgage rates, the governemnt is offering an additional incentive to get buyers into the market next year. In early November, President Obama signed a bill extending and expanding a popular tax perk for home buyers. The legislation gives qualified first-time home buyers a tax credit of up to $8,000 if they close the purchase of a primary residence by the end of June. Meanwhile, qualified current home owners are eligible for a credit of up to $6,500 when they buy their next principal residence.
9. The Marin market trends are far more important than national housing trends. Sales and pricing trends will vary a great deal from one area to the next in 2010. You will want to work with a highly experienced group of Marin sales professionals who possess in-depth knowledge about each community in our county. Browse our website frequently to get a feel for pricing and inventory trends and finally, make sure to head out to open houses in Marin to get a firsthand feel for the market.
I look forward to helping you reach your goal in 2010 of buying a home in Marin County.
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