At the end of April (when the tax credits expired) the interest rate was hovering around 6%.you would have spent much more than the $8000 Tax Credit for 1st-Time Homebuyers – many times over!

My friend Rob Levy, a top-producing agent from Portland, OR (and a fellow member of the CyberProfessionals) shared a great article he wrote on the impact of lower interest rates on the housing market.   I liked his approach and it prompted me to write this post.  I added and changed some information and details to reflect our housing market on Long Island.  The examples given do not include property taxes – only principal and interest.  You would need to add the monthly cost of property taxes for any particular home to the monthly principal and interest to know what your total monthly payment would be.

Is now a good time to buy a home?  Even if prices drop some more?  Consider this – If you buy a home for $400,000, and for this illustration obtained a $400,000 mortgage for the property – and that home drops 10% the next year – you lost $40,000.   Easy enough to figure.  But if the mortgage you obtain today cost 4.25% and the one available in a year cost 6 % – then the difference in the total cost of that home is a lot less if you purchase a home now.  $400,000 @ 4.25% = Monthly Payment of $1,967.76 vs. $400,000 @6% = monthly payment of  $2,398.20 – for a difference of $430.44 – Each and Every Month!  For a 30-year mortgage that difference in the finance charge adds up to $154,960.74.  And one thing is a “given” – when the economy improves, interest rates will rise.

And what about the “Housing Tax Credits” which expired April 30?  Did you mess up by not taking advantage of that opportunity?  Not really.  About that time in April interest rates were hovering around 6%.  The Cost of the Home – even with the tax credits – would have cost more in April than today with the historically low interest rates available. 

Despite what you’ve heard, homes are selling – and this is a great time to buy a home.  The bottom line is “How much is it going to COST to Pay for the home?”  It’s not just the purchase price that has to be considered – but the total cost of paying for it, and for most buyers that means the cost of financing a home.  Check out the financial calculators on my website to do your own estimates.

For more information – or any questions Contact Cheryl at cheryl@liagent.com or 631-493-0542.  Search the MLS for all homes available on Long Island at www.LIagent.com.

The July 2010 Housing Market Report from the Long Island Multiple Listing Service has some mixed news.

Between January and July of this year the total number of closed sales on Long Island has significantly exceeded closed transactions reported during the same time period in 2009.   That is a result of the tax credit which was very effective in stimulating the housing market. However, as expected, now that the tax credit has expired, Long Island contracted sales have posted a 17.3 percent decrease from July 2009.  There were 2,386 purchase agreements signed in July 2010 compared to 2,886 last July.  This could be explained by the many would-be summer time buyers accelerating their purchases to take advantage of the tax credit.

In July, contracted home prices on Long Island were up and down amongst the three counties.  Contracted home prices is a forward-looking indicator since it represents what deals have been recently written, not what deals have been closed.   The July 2010 contracted median home price in Nassau County was $410,000 which represented a 2.5% increase over last July.  In Suffolk County, the July 2010 contracted median home price slipped to $325,000, compared to $335,000 a year ago.  Queens reported a contracted median home price of $350,000 which is 2.8 percent less than a year ago.

Industry experts predict that home sales in the short term are expected to slow before picking up later in the year providing the job market improves.  Joseph E. Mottola, MLSLI CEO says, “To sum up the local housing market, would be to say that it is really trying to hold its ground until the job situation improves. Only after the employment picture begins to brighten will a stronger demand for housing be restored.”

For more information about the market in your area – or to request a Free Market Value Report for your home please Contact Cheryl Grossman.  To view all homes on the LI Multiple Listing Service go to Cheryl’s Web Site.

Long Island MLS now produces a monthly video that gives a quick overview of the housing market and current real estate conditions.

For more information or to request a Free Market Value Report prepared especially for your home, please call Cheryl Grossman at 631-493-0542 or by email at cheryl@liagent.com.

Only 6 months left to use the federal energy-efficiency tax credit!  There is still time for homeowners to obtain financial help for some upgrades.  The tax credit is worth 30% of the costs, up to a maximum $1,500 total, for improvements – including insulation upgrades, heating and air-conditioning equipment, windows and doors, roofs, ventilation, water heaters and biomass stoves.  Some installation expenses are not included.  More advanced energy improvements, including solar panels have no cap and don’t expire until the end of 2016.

Check out the Database of Incentives and Policies for Renewables and Efficiency for federal and New York State at http://bit.ly/fhifg.

There is a waiting list for the appliance swap-out program – but other stimulus funded programs may still be running.

The Federal Housing Administration (FHA) announced new guidelines to strengthen its assets and reduce risk.  These are some of the major changes that will affect borrowers:  

 1) There will be new loan-to-value and credit score requirements.  A  FICO score of less than 580 will require a minimum of 10% downpayment.  

 2)  A 3.5% downpayment continues to be acceptable for those with a FICO score of 580 or above.   The upfront insurance premium will be increased to 2.25% (currently 1.75%). 

 3)  Allowable Seller Concessions will be reduced from 6% to 3%.   

4)  Stronger enforcement of FHA standards & guidelines for lenders.  Lenders will be ranked by performance.

 The timing for these new guidelines to kick-in is the spring and early summer.  Long Island  homebuyers will be required to pay more money to obtain an FHA mortgage.  The best time to buy is Before these new guidelines go into effect.   To read the full statement click on FHA Report.

DON’T FORGET! You MUST be in contract by April 30 and Close by June 30 to take advantage of the  The First Time HomeBuyer and Repeat Buyer Tax Credit.  See Video with details on my Blog Post.

Contact Cheryl Grossman at cheryl@liagent.com for more information or to discuss your housing needs.

 The NYS Department of Environmental Conservation has some great ideas for homeowners on Long Island!  Going green can save money for you and your family.  These small actions can make a big difference for the environment as well.   Check out their Website for tips & resources for greener living.   The are some short videos with Green Tips for Windows and Doors, the Kitchen, the Bathroom, the Water Heater , and the Washing Machine.

One great tip is to wait until February to buy new appliances.  The Great Appliance Swap Out Program is scheduled to begin President’s week, 2010.  Rebates from $50 to $550 will be available – plus bonuses for recycling your old appliances.  There’s a Refrigerator Retirement Savings Calculator as well as some other tools and more information to help you save money-  and help the environment at the same time!  Go Green!

Today at the LI Board of Directors Meeting, the President for the LI MLS, Frank Dell’Accio discussed the latest MLS stats.  I’m relaying some of the more interesting ones for buyers and sellers. 

Houses Entering Under Contract:  An increase of 21% in December, 2009 from December, 2008.

The Number of Houses Closed (Sold):  2708 in December, 2009   –    1964 in December, 2008.

Inventory (the number of homes on the market) is down 7% from last year.  The length of time to sell all the inventory on the market is down from 17.8% to 13.7%.

HUD is issuing new regulations for FHA mortgages this spring.  They will be more restrictive and the upfront fee will increase.  I’ll write more about this in a future blog post.

An October update of the Long Island MLS Stats was reported today at the LIBOR/MLS Directors Meeting.   Sales numbers continue to reflect an improving housing market for our area.  In October the number of Closed (Sold) homes was 26,010 compared to 22,053 in October, 2008 – an increase of 14% from last year.  The number of homes Under Contract in October, 2009 was 3061 - compared to 2089 in October, 2008.  Inventory numbers are down for October also.  In October, 2009 there were 31,240 Available homes compared to 35,220 in October, 2008.    We currently have 10.2 months of inventory compared to 16.9 months last year.   The median selling price of homes on Long Island has declined 7 % from a year ago. 

Nationally, the numbers are better also.  The National Association of Realtors (NAR)  reports that home prices have increased 3-5% over last year.  The $8000 First-Time Home Buyer Tax Credits accounted for 350,000 – 400,000 more sales this year.  They project that the extended and expanded Tax Credit (See Article for Details) will boost the 2010 sales numbers by 15%.

The National Housing Market Report  published by Altos Research is a composite of housing data from 10 cities.  The November 10 Report details 2009 market trends.

 President Obama signed into law today an extension and expansion of the homebuyer tax credit.  The $8,000 First-Time Homebuyer Tax Credit is extended until April 30, 2010.  Buyers must be in contract by that date – but have until June 30 to close.  Current homeowners who have lived in their home for 5 years can receive a $6,500 tax credit when they purchase another home.  Income levels have been raised to $125,000 for single buyers and $225,000 for couples.  The purchase price of the home cannot exceed $800,000.  There are requirements and limitations.  The National Association of Realtors (NAR) published a chart which list the stipulations -  NAR Tax Credit Brief.

These new guidelines will help many buyers on Long Island.  All combined - the tax credits, reduced home prices, and historically low interest rates make the total cost of buying a home now the lowest it’s been in years - creating an incredible opportunity for you and your family.

Start your search now at www.LIagent.com or use the Quick MLS Search on the upper right sidebar.  Call us at 631-493-0542 or CGTeam@CherylGrossman.com.

Thanks to Alissa Taff for providing this important information about the proposed changes at Republic Airport on Long Island to existing commerical airspace. 

The Federal Aviation Administration (FAA) and the New York Terminal Radar Approach Control (NY TRACON) have proposed changes to existing commercial airspace for the New York metropolitan area due to violations that have been occurring in spacing requirements of the high volume of inbound traffic at LaGuardia, JFK and Newark airports.  One of the proposed changes is to lower the current ceiling height of class B (commercial) airspace from 3000 feet to 2500 feet, with some areas being allowed to go as low as 2000 feet.   This would then result in the lowering of ceiling heights at Republic airport to below 2500 feet, since they currently operate in the 3000 foot ceiling range.  This will also impact helicopters and the flight schools at Republic Airport that fly or train in the lower range of airspace that Republic’s planes will now be using.  

Lowering the ceiling heights of aircraft will result in greater noise, air po llution and increasing safety concerns over our homes and schools. We must register our complaints if we want this situation improved.  We are already impacted by noise, air quality and safety issues without the addition of lowering the ceiling height of aircraft over our neighborhoods.  Without documentation, little can be done.  WE URGE YOU TO CALL REPUBLIC AIRPORT TO LOG IN FLIGHTS OF EXCESSIVE NOISE AND LATE NIGHT HOURS – 631-752-7707 – PRESS 4.