The housing market is experiencing a cooling-off period from the boom of several years ago, making today’s economic environment the perfect one in which to buy a home. Low rates and new housing choices meaning more opportunities for home buyers. The Home Builders Association has gathered a list of questions to help consumers discover why in today’s market, now is the time to buy.
There have been a lot of stories about home prices dropping. Should I wait until prices go lower to buy a home?
The stories you're seeing about home prices dropping on the national level are from markets in booming locations such as California and along the coasts where home prices have soared as much as 40 percent in recent years. In Kansas City, housing values have increased at a more moderate pace, and continue to go up now even as some parts of the country are seeing a decline. New-home values are up more than 5 percent in metro Kansas City this year and forecast to increase again next year. If you're waiting for prices to drop in metro Kansas City, it may cost your family more money to make the move to homeownership down the road.
Why would delaying a home purchase now cost me more money later?
With new-home prices continue to go up in metro Kansas City, waiting to buy a new home simply means the price will be higher down the road. Another major factor are mortgage rates. Mortgage rates have fallen in recent months to the point where they are actually lower than they were a year ago for fixed-rate mortgages. Economic forecasters expect mortgage rates to go up in 2007, which means your buying power will be decreased -- you will have to pay more for monthly mortgage payments and will qualify for a smaller loan amount. The combination of rising prices and rising mortgage rates are a double whammy for consumers. That makes taking advantage of low rates and current prices is crucial to saving money.
Is it better to wait until the economic picture is clearer so my house will appreciate?
No. The fact is, the economy is still solid. After expanding rapidly over the past few years, economic growth is moderating – and this is actually good for housing. Most economists predict that overall GDP growth will average about 2.5 percent for the rest of the year. That means that job growth will continue to move forward at a pace that should not trigger higher inflation or interest rates. This period of moderate economic growth, job creation and low inflation, coupled with a true buyer’s market where there are plenty of homes to choose from, makes this an ideal time to purchase a new home. Kansas City has added more than 30,000 in the last two years, including more than 10,000 in the last 12 months.
Isn’t it better to “play it safe” and keep renting until things are more certain?
No. The best way to “play it safe” is to actually buy a home. And here’s why. Studies show that owning a home is the best way to builder household wealth. The sooner a person owns a home, the faster they begin to build up equity and wealth. When you buy a home, you are also purchasing price stability, knowing that you will pay the same monthly payment for the life of your 30-year mortgage. With fewer apartment rentals on the market and rents on the rise, renting lacks economic security, tax benefits and price appreciation. All of the economic fundamentals show that this a good time to buy a home and that there is upward pressure on rental apartments. The real risk isn’t in buying a home, said NAHB, it’s continuing to rent.
Should I invest my money in the stock market or use it to buy a home?
Buy a home! Thanks to the concept of “leveraging,” purchasing a home is by far the best long-term investment. Leveraging means putting down a small amount of money to earn a big return. As a homeowner, your savings continue to grown in two ways. Every year, a greater portion of your monthly mortgage payment goes to principal, reducing the overall loan amount. Second, your home appreciates over time, making it one of the very best financial investments. Not only is homeownership a stepping stone to a future of financial security, it also helps build neighborhoods and strengthen communities. It is truly the cornerstone of the American way of life, and the fulfillment of the American dream.
Should I wait to buy a home until interest rates go down further?
No. Interest rates currently stand at about 6.4 percent and are extremely favorable for buyers. In fact, they are hovering near 30-year lows. But waiting to time the market is a dangerous – and losing – game. Because interest rates are near historic lows, it is much more likely that they will head higher in the future as opposed to moving even lower. And home prices don’t necessarily move in unison with interest rates. With interest rates low, home prices down, a strong and diverse supply of houses builders offering incentives, the smartest and safest time to buy is now. Any or all of these favorable variables could change for the worse.
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HOME BUILDERS ASSOCIATION OF GREATER KANSAS CITY600 E. 103rd Street · Kansas City, Missouri 64131-4300OFFICE (816) 942-8800 · FAX (816) 942-8367
©
2007 Home Builders Association of Greater Kansas City
Sunday, December 9, 2007
Friday, December 7, 2007
County Property Taxes
County Property TaxesAs taxes become due, there are many frequently asked questions. We wanted to take the time to review some of the details of paying property taxes. The county appraiser values your property every year and then gives that information to the county clerk. Your county will notify you of the newly assessed value; however, Countrywide may not be notified of the new tax information until the end of the year. Thus, your escrow account may not reflect the change in taxes until we are notified by your county. In Kansas, taxes are split in half and are due by Dec. 20th and May 10th, paid in arrears. In Missouri, taxes are paid in full at the end of the year.
Monday, December 3, 2007
The Monticello
Here is the progress of Dakota Villas - Monticello! It is moving right along and should be finished in about 60 days. It really is moving right along. I can't tell you how excited Thesa and I are about seeing the homes really take shape here at Ashford Villas.
Party for the Villas of St. Andrew's Residents
We had so much fun on Thursday, Nov. 29th with our luncheon for our neighbors at the Villas of St. Andrews. We served Smokehouse BBQ and desserts from 3 Women & an Oven. The real fun began when we started doing our drawings every 1/2 hour for some fun prizes. We had a huge turn out - thanks Villas of St. Andrews for making our party a memorable one!
Tuesday, November 13, 2007
Signs of Progress at Ashford Villas
We are so excited here at Ashford Villas watching all the progress. As of today we now have 4 foundations in, one more will be ready to dig in the next few days. Most exciting of all is we have signs of a real home with the framing crew working on a Dakota Villas/Monticello on Lot 4.
Thursday, November 8, 2007
PMI-Private Mortgage Insurance
PMI (Private Mortgage Insurance) is insurance written by a private company protecting the mortgage lender against loss occasioned by a mortgage default. A lender requires PMI if the borrower’s first loan amount is over 80% LTV (loan to value.) For example if someone purchases a home for $100,000 and borrows over $80,000 on the first loan, he or she will pay PMI. With traditional PMI, the monthly mortgage insurance payment is added to the payment every month.
A Borrower may request the PMI to be cancelled when:
1. The balance of the loan is first scheduled to reach 80% of the original value of the property.
2. The date the principal balance of the loan actually reaches 80% of the original value of the property. This is shown with an appraisal from the lender’s certified appraisal companies.
PMI will automatically terminate when:
1. The principal balance of the loan is first scheduled to reach 78% of the original value of the property. On 30 year FHA loans, the borrower must pay the annual mortgage insurance premiums for at least 5 years even if they obtain 20% equity within the 5 years.
In order to cancel PMI, the borrower must not have made any payments 60 or more days late within the most recent 2 years and no payments 30 or more days late within the most recent 1 year. No tax liens are allowed on the property.
PMI Tax Deductible? Congress passed the Tax Relief and Healthcare Act in 2006 which recommends that PMI be tax deductible. It states that PMI will be treated as fully tax deductible for taxpayers that have adjusted gross incomes of less than $100,000 ($50,000 in the case of a married individual filing a separate return.) The taxable amount is reduced by 10% for every $1000 over $100,000 of adjusted gross income. So, if the adjusted gross income is $110,000 or more, PMI is not tax deductible.
This bill states that the tax deductibility is only applicable to mortgage insurance contracts written after January 1, 2007 and does not apply to PMI accrued or paid after December 31, 2007.
The IRS will interpret this bill and put together a tax code defining and stating the regulations of how the tax deductions may be applied. You may view IRS regulations at www.irs.gov As of today, there are no regulations pertaining to PMI tax deductions described in the website.
It is important to note that until the IRS interprets this bill and forms its regulations; no one will know exactly how the rules and guidelines will work. It is also very important to understand that even if 2007 PMI is tax deductible, it may not be deductible in 2008 or beyond. The borrower must choose his or her loan program based on their overall needs, not just on tax deductibility! And it is always advisable to instruct the borrower to consult his/her tax accountant.
How to avoid PMI
1. TAMI (Tax Advantage Mortgage Insurance) Second Mortgage
2. 2nd Mortgage
Jon Platz
Countrywide Home Loans
A Borrower may request the PMI to be cancelled when:
1. The balance of the loan is first scheduled to reach 80% of the original value of the property.
2. The date the principal balance of the loan actually reaches 80% of the original value of the property. This is shown with an appraisal from the lender’s certified appraisal companies.
PMI will automatically terminate when:
1. The principal balance of the loan is first scheduled to reach 78% of the original value of the property. On 30 year FHA loans, the borrower must pay the annual mortgage insurance premiums for at least 5 years even if they obtain 20% equity within the 5 years.
In order to cancel PMI, the borrower must not have made any payments 60 or more days late within the most recent 2 years and no payments 30 or more days late within the most recent 1 year. No tax liens are allowed on the property.
PMI Tax Deductible? Congress passed the Tax Relief and Healthcare Act in 2006 which recommends that PMI be tax deductible. It states that PMI will be treated as fully tax deductible for taxpayers that have adjusted gross incomes of less than $100,000 ($50,000 in the case of a married individual filing a separate return.) The taxable amount is reduced by 10% for every $1000 over $100,000 of adjusted gross income. So, if the adjusted gross income is $110,000 or more, PMI is not tax deductible.
This bill states that the tax deductibility is only applicable to mortgage insurance contracts written after January 1, 2007 and does not apply to PMI accrued or paid after December 31, 2007.
The IRS will interpret this bill and put together a tax code defining and stating the regulations of how the tax deductions may be applied. You may view IRS regulations at www.irs.gov As of today, there are no regulations pertaining to PMI tax deductions described in the website.
It is important to note that until the IRS interprets this bill and forms its regulations; no one will know exactly how the rules and guidelines will work. It is also very important to understand that even if 2007 PMI is tax deductible, it may not be deductible in 2008 or beyond. The borrower must choose his or her loan program based on their overall needs, not just on tax deductibility! And it is always advisable to instruct the borrower to consult his/her tax accountant.
How to avoid PMI
1. TAMI (Tax Advantage Mortgage Insurance) Second Mortgage
2. 2nd Mortgage
Jon Platz
Countrywide Home Loans
Lambie-Geer Homes
Quality craftsmanship, functional creativity, and personal satisfaction are what you feel as you step into a Lambie-Geer home. Respected as one of the top builders in the Kansas City area, Lambie-Geer won numerous awards locally and nationally for building some of the most exclusive subdivisions and has carved out a niche for itself in the highly competitive upper bracket homes market.
Choosing a builder is one of the most important decisions you will make. Building a home should be a wonderful and exciting experience, but too often the process becomes confusing and frustrating. You can rest assured, Lambie-Geer guarantee's total satisfaction.
Choosing a builder is one of the most important decisions you will make. Building a home should be a wonderful and exciting experience, but too often the process becomes confusing and frustrating. You can rest assured, Lambie-Geer guarantee's total satisfaction.
Pinecrest Development
Pinecrest Development Company has built a Solid Reputation by providing Exceptional Homes at an Outstanding Value! Our truly personalized Homes are constructed with Top-of-the-line building materials that will endure for Generations!
Our unique Homes are designed to provide both comfort and safety. Our team puts their Heart into every Home we build and our success is a result of our long-standing commitment to Total Customer Satisfaction! WE understand your Home is a Reflection of who You are and an investment in your Families future. WE are dedicated to putting forth maximum effort to earn your trust and respect and pledge to provide you with a professional team of individuals to assist you in building the home of your dreams. WE believe in Teamwork and Fair play in our conduct and attitude toward our customers and business partners. OUR success depends upon your Home Building Experience!
Our unique Homes are designed to provide both comfort and safety. Our team puts their Heart into every Home we build and our success is a result of our long-standing commitment to Total Customer Satisfaction! WE understand your Home is a Reflection of who You are and an investment in your Families future. WE are dedicated to putting forth maximum effort to earn your trust and respect and pledge to provide you with a professional team of individuals to assist you in building the home of your dreams. WE believe in Teamwork and Fair play in our conduct and attitude toward our customers and business partners. OUR success depends upon your Home Building Experience!
Dakota Villas
Brief Bio: Tony Plunkett founded Dakota, Inc. and has raised the standards for custom home building. Johnson County had not yet been treated to such outstanding home building and today Dakota, Inc is considered a premiere builder. Building beautiful homes in a variety of subdivisions, the company founded in 1992 is sure to have something to suit every home buyer. While the company is relatively young, Tony has personally been involved in the real estate and construction industry for almost 30 years. That breadth of experience will make all the difference in your new home.
Supported by an empowered staff and team of talented individuals, Tony Plunkett is dedicated to nurturing a rewarding home building experience for every client. Building a home is unlike any other experience, and in the right hands it can truly be incredible.
Dakota, Inc. has centered its process around creating homes of superior craftsmanship. The Dakota Team uncovers each buyer’s deepest wishes for a new home and transforms those dreams into unique, personalized reality.
Customized to individual tastes and preferences, each home is completed to meet the company’s high standards for quality. From the material used in construction to the people hired to construct a home, Dakota, Inc. makes sure to uphold its reputation for quality by using only the best. It is not enough to simply meet the expectations of new home buyers; Dakota, Inc. is constantly exceeding them.
In a business where you are only as good as your last project, Tony Plunkett and the entire Dakota, Inc. Team work tirelessly to keep the reputation they have built. Each home is built to please its buyer and home owners are more than happy to refer friends, family and casual admirers to the builder who delivered more than what he promised. Word of mouth has always served as the best advertising for Dakota, Inc. and is the single best indication of the company’s commitment to quality and customer satisfaction.
No matter your lifestyle or needs, Dakota, Inc. is sure to have the perfect home for you. The company motto is "When you choose Dakota, you´ve found a home." With every home built Tony and Gayle are doing their best to make that statement true. Your dream home will not be exactly the same as a previous client. Your needs will not be precisely the same. You need a builder committed to delivering to you a home just for you. Choose your new custom home builder wisely. Choose experience, reputation and quality. Choose Dakota, Inc.
Supported by an empowered staff and team of talented individuals, Tony Plunkett is dedicated to nurturing a rewarding home building experience for every client. Building a home is unlike any other experience, and in the right hands it can truly be incredible.
Dakota, Inc. has centered its process around creating homes of superior craftsmanship. The Dakota Team uncovers each buyer’s deepest wishes for a new home and transforms those dreams into unique, personalized reality.
Customized to individual tastes and preferences, each home is completed to meet the company’s high standards for quality. From the material used in construction to the people hired to construct a home, Dakota, Inc. makes sure to uphold its reputation for quality by using only the best. It is not enough to simply meet the expectations of new home buyers; Dakota, Inc. is constantly exceeding them.
In a business where you are only as good as your last project, Tony Plunkett and the entire Dakota, Inc. Team work tirelessly to keep the reputation they have built. Each home is built to please its buyer and home owners are more than happy to refer friends, family and casual admirers to the builder who delivered more than what he promised. Word of mouth has always served as the best advertising for Dakota, Inc. and is the single best indication of the company’s commitment to quality and customer satisfaction.
No matter your lifestyle or needs, Dakota, Inc. is sure to have the perfect home for you. The company motto is "When you choose Dakota, you´ve found a home." With every home built Tony and Gayle are doing their best to make that statement true. Your dream home will not be exactly the same as a previous client. Your needs will not be precisely the same. You need a builder committed to delivering to you a home just for you. Choose your new custom home builder wisely. Choose experience, reputation and quality. Choose Dakota, Inc.
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