-by Peter Francese

There’s no lipstick big enough to put on this ugly bear market.  During the past two months we’ve had the most miserable weather, darkest economic news and an awful real estate market.  The stock market swoon, massive credit market problems, and falling consumer confidence have produced a truly extraordinary decline in real estate transactions throughout our state as well as the nation.
 
 
        
Sales volume during the first two months of this year for all New Hampshire properties was down 30 percent, residential was off 28 percent and condominium sales volume was 34 percent below the same period last year. It doesn’t get much worse than that.  Median residential home prices dropped just 7.5 percent despite a 24 percent drop in units sold while condominium median selling price edged down only 2.4 percent, even though units sold were off 24 percent. 
  (more…)

Great News! Higher FHA Loan Limits

There aren’t a lot of positives to talk about as far as residential sales here in the Lakes Region of NH for February of 2008. A lackluster total of 34 homes sold compared to 51 for February of 2007. Low end sales were strong with over 50% of the sales under the $200,000 mark. This is the first month that I can recall in a long time where there was only one sale over $1 million. That honor belongs to a nice 3,000 sq ft, 4 bedroom, lake front home on Dockham Shore in Gilford. This 2 year old home has a bright open concept floor plan, hardwood and tile floors, a home theater, mahogany decking, cobblestone driveway, 103 ft of shorefront, and a 40 ft dock. The great thing about this property is that it just looks like it is supposed to be on the lake and was not overbuilt for the area as many of the newer lake homes are today.

There is some truly great news on the financial front for buyers looking for a mortgage. As part of the Economic Stimulus Act of 2008, the Federal Housing Administration has just raised the purchase price limits on homes to allow more properties to qualify for FHA loans. For example, in Belknap County the limit on a single family home was $200,160 but is now increased to $281,250. These loans will now be more appealing to a much wider range of buyers. Under the old limit, buying a newly constructed home was almost impossible. By raising the limit many newly constructed homes will now be able to be purchased through this program. While historically FHA loans were considered to be more for first time and low income buyers, there are no income limits so expect these loans to be utilized more by a broader range of people in the coming year. FHA loans can be used as a way to refinance your present home or even do a reverse mortgage. Rates and guidelines are similar to the standard 30 yr fixed loan programs. The advantages of an FHA loan include a low down payment, it allows seller contributions toward closing costs, and the buyer can also receive gift money from friends or relatives to complete the transaction. It is a great program for some hard times and it should be a tremendous success this coming year!

RESIDENTIAL HOMES SOLD FEBRUARY 2008

Towns of Alton, Barnstead, Belmont, Center Harbor, Gilford, Gilmanton, Laconia, Meredith. Moultonborough, New Hampton, Sanbornton, and Tilton

No signs at this time…

Snow and more snow. The weather we have been experiencing has certainly slowed down buyers from looking at property here in the Lakes Region of NH. Everyone seems to be struggling with the effects of winter. Trying to stay up with keeping walkways, decks, and driveways cleared seems like a full time job. To me one good thing out of all this is that the snow seems to have obliterated the huge number of real estate directional signs poised on just about every street corner. Sellers see these signs as a beacon to help a stray buyer or two get to their property. But the sheer number of these signs, to me at least, doesn’t pass on a very encouraging marketing message to the public. If a serious buyer wants to find a certain property he will even without a directional sign—well maybe not right now, unless some snow melts in front of the house!

Rates were down and now they are back up a bit. They seem to change almost daily. Undoubtedly, there are buyers out there that have had preliminary talks with their lender, had gotten a rate quote, and then found that the rates were different when they found a property that they wanted to buy. Even rates quoted at the time of an application for a mortgage are not guaranteed at the time of closing unless the buyer “locks in” the rate.  Lenders offer programs where buyers can lock in their rate for a specific period of time. These programs protect the buyer from having his rates increase any further. There are also options that allow a one time rate ”float down” should interest rates drop so buyers can get that lower rate.  There may be deposits, fees, or slightly higher rates associated with these types of programs depending on how long a rate lock you need. Some lenders offer free rate locks for 30 or 60 day periods. You can even find programs that allow buyers to lock in a rate and then go shop for a property. So check with the different lenders in the Lakes Region to see who offers the best program and the best deals.

Residential Homes Available as of March 1, 2008

Towns of Alton, Barnstead, Belmont, Center Harbor, Gilford, Gilmanton, Laconia, Meredith, Moultonborough, New Hampton, Sanbornton, Tilton