Spring Cleaning “How to start”

4 Easy steps to reclaim your home from the clutter and disorganization.

By Sarah Aguirre, About.com Guide

Amid the endless piles of laundry, dishes, forgotten bills, and overdue library books, you have a house. A house you would desperately love to show off with pride. It makes you depressed even to think about how to get this mess organized. You feel your only hope now lies in the chance that one of your horrified relatives will recommend you for a cable show home makeover. While you’re waiting for that lightning bolt to strike, let’s try instead some simple steps and ideas to help you make your home into a place that allows cleaning and organization to be easily achievable. Who knows, you might even find the cordless phone you lost months ago!

Step 1: Analysis of Areas

Grab a spiral notebook and a pencil. Take a few minutes and mentally survey each room. In your notebook, jot down the problem areas in the room, putting one problem on a page. You’ll need the rest of the space on that same page for the following steps. The items on the paper should be parts of the room that really bug you, or that your family finds impossible to keep neat.

For example:

Shoes in piles next to your front door; the table in the entryway piled with mail; the magazine rack overflowing with books, magazines, and pamphlets; the coats, hats, and mittens etc piled in a heap next to the entryway closet. Carefully (but quickly) analyze each room in the house in this way, making a list of the areas that need improvement.

Here are rooms or parts of your home not to forget about:
Junk drawers
Medicine cabinets
Garages
Closets
Storage, including attic, basements, crawlspace
Outdoors

Tip: We don’t always see the disorder in these areas until we open them and try to find things.

2: Analysis of Reasons

For each of the problem areas in a room, figure out why the disorganization and mess is happening. I find this most easily done if you are actually in the room you are surveying. All answers are acceptable here, including the fact that you live with slobs. Usually there is more than one reason why an area of your home is continually unorganized.

For example:

Why are there shoes piled up next to your doorway? You like people to take off their shoes when they come in. No one in your family wants to take their shoes all the way to their rooms, andthere’s not enough room in the closet for all the shoes to fit, etc.

Why are the magazines overflowing? You may realize that you have issues of Good Housekeeping from the 70’s in there, or a magazine you bought only for the fudge praline cake recipe on the cover.

Continue this process for each of the problems in the room. Write down the reasons for each problem in your notebook, then move to the next room. When you’re done analyzing all your problem areas go on to Step 3.

Step 3: Solutions

Now comes the fun part. Let’s find ways we can fix the problems. Think about habits, behaviors, and tools that can make those messes disappear.
Do you need some sort of a tool for organization to help your problem?
Is the problem a habit that just needs to be enforced and practiced?
Is it a combination of containers or tools and habits that need to be changed?

Many of the problems you will encounter will require organizational tools and behavioral changes. Keep in mind that the best organizing system of shelves, hooks, and labels does no good if it isn’t utilized.

For Example:

The junk mail is piling up on your table. Do you need a sorter directly on the table? Maybe the person going through the mail initially needs to be responsible for sorting out the junk (which is 98% of the mail at my house). If you have a lot of different people in your home that receive mail, try giving each person in the house their own mail organizer in their rooms. Older children could then be responsible for their own mail, thinning out the amount you have to go through. What about switching your family to automated bill paying? Many utility companies today allow your utility bills to be deducted from your checking account automatically. You may still receive mail concerning receipt of payment, but at least these can be filed easily without worry that you’ll forget to pay.

Don’t forget about tools that may aid you in organizing problem areas. What if you put an over-the-door shoe organizer in the entryway closet? Do you need extra coat hooks? Would a bowl on the entry table specifically for keys eliminate the chances of having to dash around the house for 15 minutes in search of them every morning? Try to come up with brainstorm ideas for each problem.

Find solutions to the problems that annoy you most. Check the detailed room links on this website and the general links provided to find some solutions. Call your friends and ask them what they do to combat the problem. Enlist your family’s help to find out what would enable them to organize more effectively. If you hold a family meeting where everyone has a voice, you may find that those slovenly family members actually have good ideas. Make decisions about what you are going to try in your own home. Write down the solutions you’ve decided on.

Step 4:Implementation.

If when you went through your home you had only a few problem areas, then you’re lucky and you can probably implement all of your changes immediately. Begin by making a list of the tools needed from your lists of solutions (Step 3). Buy the tools that you need and set them up in their new home. Warning: organizational tools will not help if you don’t use them! You must also start to implement the behavior changes associated with keeping the mess clean.

Force yourself to remember to put your keys in the new bowl. Enlist your family’s help. If they see dad’s keys on the kitchen sink, have them take the keys and put them in the key bowl. You may find that initially some family members (I’m not naming names) find it annoying that their routine of keeping their things wherever they happen to throw them down is being interrupted. Be patient. The relief of always knowing where these items are will win them over in the end.

Keep yourself and your family honest by reviewing the room with your list in hand once a day. It may be best to do this at the same time each day. If it was done right before dinner, the family could then discuss problems or successes over the meal. Have you kept up with the changes needed? Have others? Evaluate yourself daily until the room suddenly seems to have removed itself as the source of your frustration.

If you have substantially more work to do, do not expect that you will be able to instantly do the changes that you desire, especially if your solutions involved hundreds of dollars of organizing equipment. It may be necessary for you to pick one room at a time to overhaul. Follow the same steps for the overachievers above who are already almost perfect. If you have a lot to do in one room you may have to set aside a Saturday to put together and install shelves, racks, etc. Try to involve your family as much as possible. Add other rooms and areas of your home as you see how you and your family maintain the ones that you’ve begun. If you are diligent there may actually be a day when someone says, “Have you seen my…” and you’ll be able to answer, Yes!”

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For a FREE Home Value or Buyers Analysis please visit my website “Welcome Home“.

The Cost of Waiting for Home Prices to Fall

Many purchasers have been sitting on the sidelines waiting for home prices to hit bottom. They want to guarantee that they are purchasing at the best possible price. Like them, we also believe that prices still have some room to fall in most markets. However, we disagree that waiting is a good financial decision. The buyer should not be concerned about housing prices. They should be concerned about cost.

The cost of a house is made up of the price AND THE INTEREST RATE they will be paying. Two different pieces of news released yesterday highlight this point.

PRICES

The National Association of Realtors (NAR) released their 4th quarter housing research report. In the release, they reported that home sales rose 15.4% in the 4th quarter over the 3rd quarter. They also showed that prices remained stable during the year:

The national median existing single-family price was $170,600 in the fourth quarter, up 0.2 percent from $170,300 in the fourth quarter of 2009.

A buyer who delayed a purchase might find solace in the fact that prices have not increased. However, the other news released yesterday paints a different picture.

INTEREST RATES

The Primary Mortgage Market Survey was released by Freddie Mac which showed that the 30 year fixed rate mortgage was at 5.05%. Frank Nothaft, vice president and chief economist of Freddie Mac said:

“Long-term bond yields jumped on positive economic data reports, which placed upward pressure on mortgage rates this week…As a result, interest rates on a 30-year fixed-rate mortgage rose to the highest level since the last week in April 2010.”

So prices have remained stable but interest rates have risen dramatically in the last 90 days. What does that mean to a buyer looking to purchase a home this year?
The price is the same. It just costs more.

Let’s show you what the news means:

 

 

 

 

 

By sitting on the sidelines for the last 90 days a purchaser lost:

• $89.44 a month
• $1,073.28 a year
• $32,198.40 over the thirty year life of the mortgage

If you buy a $340,000 home, double all these numbers.

Bottom Line

Even if prices fall another 10% this year, the cost of a home will increase if interest rates go up more than 1%. Buyers should not worry where prices are going. They should be concerned where costs will be later in the year.

Article courtesy of my friends at KCMblog

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If you’re looking to buy or sell please feel free to email me at (mike@daprilerealty.com) or visit my website “Welcome Home“!

2011 Will it be the END of the Housing Crash?

By SIMON CONSTABLE

There might finally be some good news this year about the nation’s dismal housing market. Or, at least, the bad news could stop.

Either way, it will be welcome relief for current homeowners as well as for potential real-estate investors. Reasons to be optimistic have been sadly lacking since the housing bubble burst in 2006.

For sure, last week we learned the widely watched S&P/Case-Shiller home-price index fell 1% in December, its fifth straight decline. The index tracks 20 major markets.  But that figure belies real reasons to be optimistic, according to some experts. If they are right, it might make sense to jump into real estate. The trick is avoiding getting burned again, and it doesn’t necessarily mean owning a home.

First, let’s recap the economic signs a bottom is close.

Houses Are a Good Deal

Housing is the most affordable it has been in decades, according to analysts at Moody’s Analytics. They don’t just look at house prices. They also look at incomes.

Nationally, the cost of a house is the equivalent of about 19 months of total pay for an average family, the lowest level in 35 years. Prices usually average close to two years’ pay, although that varies nationally.

At the peak, midway through the last decade, a home in Los Angeles cost the equivalent of 4.5 years’ pay. The average price has since fallen to just over two years’ income now. That’s well below its pre-bubble average of 2.6 years. This means average Los Angeles homes are cheaper in “real terms” than they were typically during the period 1989 through 2003.

The opposite is true around the Washington beltway, where it will take 26 months of pay to buy a home, versus the historical norm of 22 months.

In the end, it will be affordability that will drive people to buy homes.

“Pricing is down so much in some markets that when you analyze renting versus owning it makes much more sense to own,” says Michael Larson, a real-estate analyst at Weiss Research in Jupiter, Fla.

It is definitely bullish. But what about timing?

“Housing prices will probably bottom in 2011,” says Scott Simon, a managing director at money-management firm Pimco in Newport Beach, Calif. He foresaw the housing crash, helping his firm dodge losses that plagued Wall Street.

Mr. Simon says prices might dip another 5%. Still, in the scheme of things, that’s small. Consider this: In some markets, home prices have fallen by half or more since 2006.

For instance, in once-hot Miami you can snap up an average house for under $166,000, according to recent data from the National Association of Realtors. That’s down from $371,000 in 2006. Another 5% drop would take it to $158,000.

Investors Stepping Up

Here’s another sign the market is nearing a bottom: Investors have started to buy up houses and condos, in some instances paying entirely in cash. That’s a far cry from the heady bubble days when borrowed money seemed the key to riches. The bubble-era speculators who got burned tended to buy at the peak and borrowed heavily to do so. When the crash came, they quickly saw their wealth erased.

Take Miami again. Last year, more than half of all transactions were made entirely in cash, according to a recent report in The Wall Street Journal. That compares with 13% of deals in the last quarter of 2006, the height of the bubble. Similarly, in Phoenix 42% of sales in 2010 went to all-cash buyers, up threefold since 2008.

It’s a sign that these investors are betting on a rebound. Investors buying at current prices are looking for deals, or so-called bottom fishing. They typically like to pay entirely in cash (or with a relatively small loan) to speed up transactions. That can be vital for an investor wishing to lock in a deal fast.

If this is a turn in the market, then it might make sense to go out and buy a home. But, warns Pimco’s Mr. Simon, “buy in areas you really know.”

Plan to Stay Put

Buy and hold. While the good news is that the worst of the housing crash might be over, the bad news is that the fast gains of the glory days of 2005 and 2006 won’t be back any time soon. So to cover the costs of buying and selling, and what could be a prolonged recovery, plan to own for more than 10 years, explains Jack Ablin, chief investment officer at Chicago-based Harris Bank.

Also remember that borrowing money to buy a house can still be risky. If you pay for a $100,000 property with $20,000 cash and borrow the rest, a dip in the value of $20,000 would leave you with zero equity. On top of that, you’d have to pay to maintain and repair the property, something not necessary when renting.

Home Buying Without a House

There are other ways to benefit from a real-estate rebound than directly buying a house. Such investments include stocks, mutual funds or exchange-traded funds. Unlike homes, which typically cost tens of thousands of dollars, these financial investments can be made in smaller amounts and typically are easy to sell.

Weiss Research’s Mr. Larson says although new homes are oversupplied, home builders might benefit from a rebound as the situation rights itself.

Rather than pick individual stocks, he says, it probably makes sense for small investors to pick broader investments that hold many different stocks. In particular, he points to the SPDR S&P Homebuilders ETF (XHB), which tracks a basket of home-builder stocks.

Mr. Larson also highlights specialized mutual funds such as the Fidelity Select Construction & Housing fund (FSHOX), which tracks home builders as well as home-improvement retailers like Home Depot and Lowes that would also likely benefit from a housing recovery.

Simon Constable is author of the forthcoming book “The WSJ Guide to the Fifty Economic Indicators That Really Matter: From Big Macs to ‘Zombie Banks,’ the Indicators Smart Investors Watch to Beat the Market.” simon.constable@dowjones.com

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For a FREE home value analysis or buy side analysis visit my web site “Welcome Home“

Selling Your House? 5 Reasons To Do It NOW!

by The KCM Crew on February 15, 2011

The conventional wisdom when selling a home has always been to wait until the ‘Spring Buying Season’. Over the years, that has seemed to make sense and is now accepted as a good strategy for those who want to sell their house and receive the best possible price. This real estate market has shattered many previously held beliefs. The wisdom of waiting for a spring market is another belief that is about to fall. Here are five reasons why?

1.) Interest Rates Are On the Rise

Interest rates have spiked up rather dramatically over the last ninety days and are now over 5%. Initially, an increase in rates has a positive effect on the market as it forces buyers off the fence. However, it also eats into a buyer’s purchasing power. As rates increase, the mortgage amount a buyer qualifies for decreases. This will eventually have a negative impact on prices.

2.) Your Dream Home Will Never Be Cheaper

If your family goal is to sell your current house and take advantage of the fabulous selection of properties currently available to buy the home of your dreams, DO IT NOW! Prices will continue to soften in most markets. However, if you are buying, COST should be more important than PRICE. Cost can be dramatically impacted by rising mortgage interest rates. Do the math and decide if now is the time.

3.) Buyers Are Out Early

There is mounting evidence that buyers are coming out earlier this year. A belief that now is a good time to buy coupled with the increase in interest rates has started the buying season early.

Pete Flint, CEO of Trulia:

“We’re seeing a national resurgence of buyer and seller activity on Trulia.com. In January alone, we experienced an unprecedented level of site traffic including 11 million unique visitors – which is more than 70 percent year-over-year growth. We’ve are now experiencing 100,000 property views per minute.”

The National Association of Realtors just reported that the number of house sales increased 12.9% over last month.

4.) Inventory Increases Every Spring

Every year there is an increase of inventory which comes to market as we approach the spring. Here is the number of listings available for sale in 2010.

* February – 3,531,000
* March – 3,626,000
* April – 4,029,000

We believe there will be an increase in these numbers in 2011 as there is a pent-up selling demand created by the weak market of the last few years. You won’t have to worry about this increasing competition if you sell now.

5.) We Are in the Eye of the Foreclosure Storm

While banks are trying to rectify their foreclosure procedures, there is a large supply of discounted properties which has been delayed coming to market. This inventory will be released sometime in the next few months. Foreclosures sell on average at a 41% discount. When released they will be competing with your house for the buyers in the marketplace. If you are looking to sell in 2011, you want to sell before this inventory becomes your competition.

CNN Money quoted the leadership Of RealtyTrac on this issue:

“We’ve now seen three straight months with fewer than 300,000 properties receiving foreclosure filings, following 20 straight months where the total exceeded 300,000,” said James Saccacio, CEO of RealtyTrac.

“Unfortunately,” he added, “This is less a sign of a robust housing recovery and more a sign that lenders have become bogged down in reviewing procedures, resubmitting paperwork and formulating legal arguments related to accusations of improper foreclosure processing.”

“We expect a spike in the first quarter,” said Rick Sharga, a RealtyTrac spokesman.

Bottom Line

These are five strong reasons to sell now instead of waiting until later in the year. Sit down with a local real estate professional today and decide the best options for you and your family.

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For a FREE home price analysis or FREE home search visit my web site “Welcome Home“.

Congress Renews Mortgage Insurance Write-Offs

By: Kenneth Harney

Tucked away inside Congress’s massive $858 billion end-of-the-year tax bill is a little-publicized provision that could prove helpful for just about anybody planning to buy a house in 2011 with a down payment as small as 3 percent.

The bill extends for another 12 months the deduction of loan insurance premiums – whether they are for so-called private mortgage insurance (PMI) or federal FHA or VA loan premiums or guaranty payments. Those deductions were scheduled to disappear from the federal tax code Dec. 31. Now they’ll be available for tax-savvy buyers at least through December 31, 2011.

Here’s why the 11th-hour extension is important: Most mortgage lenders require borrowers to make 20 percent or larger down payments. However, most buyers – especially first-time purchasers – just don’t have that sort of money sitting around. To get a loan with a down payment of less than 20 percent, virtually all lenders require borrowers to pay for insurance policies that will cover the lender against losses resulting from delinquencies or foreclosures.

FHA, for example, allows home buyers with FICO credit scores above 580 to make down payments as small as 3.5 percent, but borrowers must pay upfront insurance premiums of 1 percent of the loan amount and additional annual premiums that are included in the monthly mortgage charges. Private insurers, some of whom allow down payments as low as 3 percent but more typically 5 percent, also require substantial premium payments that can amount to thousands of dollars over the course of the borrower’s ownership of the house.

Prior to 2007, all these premiums were considered non-deductible because they weren’t “mortgage interest,” which has been deductible since the inception of the Internal Revenue Code back in 1913. But three years ago, Congress changed that policy, allowing borrowers who pay mortgage insurance premiums to treat them as if they were the equivalent of interest payments on a home loan. But, as Congress so often does when it’s amending the tax code, it set a 2010 expiration date for the new deduction benefit. That way, lawmakers could evaluate whether allowing hundreds of thousands of taxpayers to write off their loan premiums helped foster home ownership.

Ultimately, in December negotiations on the 2010 tax bill, Congress decided it was a good idea worth continuing. As a result, low-down payment purchasers who itemize on their tax filings will continue to be able to take deductions that range anywhere from $300 to $500. Of course, as with all federal programs there are rules and restrictions you’ll need to follow to qualify.

First, there is an income limit. If you’re married and filing taxes jointly, you qualify for a full write-off if your annual “adjusted gross income” is $100,000 or less. If your income does not exceed $110,000, you’ll be able to claim a partial deduction. If you are single or married filing singly, your income must be no higher than $50,000 to qualify for the full write-off, and no higher $54,500 for a partial deduction.

To claim the deduction for 2010 or 2011 returns, your lender can provide you with an IRS Form 1098, indicating how much mortgage interest you paid during the year and how much in mortgage insurance premiums you paid.

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To learn more about today’s market visit my website “Welcome Home“.

15 Ways to Prepare Your Home for the Holidays

In a few days, a ravaging hoard will descend on your humble dwelling. Is it up for the job? Use our thorough, all-encompassing checklist to prepare for the onslaught of holiday guests.

By Roy Berendsohn

1. Clean the microwave. Appliances take a beating during this holiday, but there’s still time to make a few pre-holiday adjustments. Take out the microwave’s rotating tray and scrub it or pop it into the dishwasher. Wipe down the microwave’s interior with a soft cloth and a little soapy water. Make sure its air vents are clear of dust and grease. (If the microwave is an over-the-range model and provides general kitchen ventilation, be especially thorough cleaning its vent surfaces of greasy dust.) If you don’t have spray degreaser on hand, use a soft cloth moistened with a glass cleaner.

2. Don’t clean the oven. The self-clean cycle is so stressful on the appliance that it could cause it to fail, right before you need it most. Give a quick cleaning around the top burner elements and leave the rest be. Save the big cleanup until leftovers are safety nestled in the fridge.

3. Inspect the refrigerator. It’s liable to be opened and closed more times on this one day than it is in a couple of weeks of normal use. Check for the following problems:

* Tighten screws on any loose door handles.

* Fix loose or misaligned door gaskets. Take a nut driver or socket and wrench, loosen all hex head gasket screws, reposition the gasket using a putty knife to shove it into position and re-tighten. Consider installing a new gasket after the holidays.

* Clear blocked freezer vents. Reposition food in the freezer compartment to clear area around vents.

* Clear cold air vents. Reposition food in fresh food compartment to allow cold air from freezer to move more freely. Gain critically needed space by putting all drinks on ice in a cooler.

* Replace burned out lights with an appliance bulb, typically a clear 40-watt bulb sized for appliance use–a $3 item at hardware stores and home centers. If the fresh food compartment is still dark after its replacement, that usually indicates a failed door switch.

4. Prepare vacuum cleaners. Empty canisters or replace bags on these appliances and position them in a hall closet or other location for rapid deployment.

5. Clean drip coffeemakers. If you haven’t recently checked the drip opening (and the area around it), you may be unpleasantly surprised. Unplug the coffeemaker and turn it upside down. If the drip opening looks like it’s covered in asphalt, clean it with a soft cloth and a solution of warm water and dish detergent. It may take several tries to get the crud off.

6. Inspect the dishwasher. Check the strainer/drain area in the bottom of the wash tub (it’s located under the spray arm). Remove food debris and wipe off detergent residue. Remove utensils and any bits of plastic or glass that you find in the bottom of the dishwasher tub. Wipe detergent residue, mold and slime off the door gasket and around the rim of the door, as well as the latch arm that locks the door.

7. Check the oven temperature. If you don’t have an oven thermometer to check the appliance’s temperature, this is the perfect excuse to treat yourself to a more versatile test instrument: a battery-powered infrared thermometer. The Heat Seeker from General Tools is a point and shoot diagnostic tool. Its laser points right to the surface you want to measure. After you’re done analyzing the range, you can use it for checking heating/cooling equipment, and for any number of repairs around the house, such as whether the dryer is getting sufficiently warm. It’s versatile and packs a diagnostic punch with -4 to 605 degrees F capability. That’s a lot of range for a $66 test tool.

If need be, adjust the range’s oven temperature using the instructions in the owner’s manual or using a repair manual for the appliance. Sometimes it’s nothing more complicated than adjusting the temperature dial so it points correctly.

8. Sharpen knives. Tuning up kitchen knives is easy, so don’t settle for hacking the bird when you can carve it like a pro.

The traditional method calls for laying the knife’s long axis at 90 degrees to the long axis of the sharpening stone and then moving down the stone’s length with a gently curving arc. Hold the knife so it’s about 22 degrees to the stone’s surface. To read more, click here.

While you’re at it, you can tighten loose wooden knife handles by tapping in the center of their rivet using a center punch struck with a ball-peen hammer. The method spreads the rivet slightly and tightens the handle. To read more, click here.

9. Tune up cabinets. A few minutes with a screwdriver is all it takes to whip loose parts into shape. Tighten loose cabinet hinges. Tighten the screws that mount to the door and to the cabinet wall. While you’re at it, tighten loose drawer and door pulls and drawer slides. If kitchen drawers are over-stuffed and liable to jam in the middle of the cooking frenzy, now’s the time to take out some of the clutter.

10. Take care of the toilet. Not to get too graphic here, but toilets see a tougher workout than any other fixture in the house, especially when guests pull up a seat. Now’s the time to take care of poor flushing action or a toilet that flushes by itself by replacing the flapper valve or the entire flush mechanism. If the toilet rocks slightly, try tightening its mounting bolts. If you lift the bolt caps and find severely corroded fasteners (don’t be surprised) leave well enough alone and let it go until after the holidays. For more on tuning up toilets, click here.

11. Replace burned out light bulbs. Pay close attention to lights that serve the front entrance and walkway that leads to the front door or other busy entrances.

12. Make your home slip- and fall-proof. Fix loose treads on exterior steps, loose deck boards or loose pavers on front walkways. Take care of all other tripping/falling hazards while you’re at it, like using double-sided tape to stick down slippery rugs. Tighten the mounting screws on loose handrails.Buy de-icer to clear walkways and the driveway.

13. Bring in firewood. Stack it and let it dry for a few days before lighting that cheerful holiday blaze. Test run gas fireplaces before the big day, especially if they haven’t been used since last winter. Split kindling for the holiday fire safely. Hold the kindling in place using a scrap of wood with a roofing nail driven through its end. Jab the nail into the kindling you’re splitting to hold it in place and to keep your hand safely away from the hatchet or axe.

14. Child-proof your home. Make all child-safety preparations in advance, such as covering electrical outlets, moving lamps and vases away from table edges and making provisions to block stairways to prevent hazardous falls.

15. Final Safety Checklist:

* Change smoke detector/CO detector batteries.

* Keep jumper cables on hand, especially if you’re expecting a big crowd. Always seems somebody’s got a bad battery, and it’s usually the car that will block everybody in the driveway.

* Double-check your first aid kit. At the least you should have burn cream, ice packs and bandages to deal with kitchen-related cuts.

* Keep a fire extinguisher handy in the kitchen.

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To search the MLS for a new home please visit my website “Welcome Home“.

“NEW” First time Buyer Program!

by Rebecca Boykin, Communications Manager, Illinois Housing Development Authority on November 15, 2010

As the state’s housing finance agency, the Illinois Housing Development Authority (IHDA) offers SmartMove—a suite of safe and reliable homebuyer loan products available statewide.

SmartMove mortgage products can make the difference in landing a home sale with incentives such as affordable interest rates and down payment assistance.

“Our SmartMove programs provide a secure and affordable way for first-time buyers and Veterans to purchase a home,” says Gloria L. Materre, IHDA executive director.

SmartMove features up to $6,000 for down payment and closing costs as a 10-year zero percent forgivable loan. IHDA’s programs are geared toward borrowers who need extra flexibility on sources of income or who have limited funds for down payment and closing costs.

SmartMove features:

* Maximum LTVs from 96.5 to 100 percent
* Conventional, FHA, USDA products available
* Fixed-rate loans with up to 30-year terms
* Mortgage insurance requirements at one-third less than other conventional products

Qualifications include:

* Minimum credit score = 620 (FHA and USDA loans) or 660 (conventional loans)
* Buyer must contribute 1 percent or $1,000 of purchase price, whichever is greater
* Household income and purchase price limits apply
* HUD-approved homeownership counseling required

For a list of lenders offering SmartMove, see www.ihda.org. Call 312-836-5200 to speak with the Homeownership Originations department.

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To search the MLS for a new home please visit my website “Welcome Home“.

9 Smart Ways to Come Up with Down-Payment Cash

By Luke Mullins

Although cheaper prices and record-low mortgage rates have made home buying increasingly attractive, tight lending standards continue to keep consumers on the sidelines. And while a beefed-up FICO score and documentation requirements may have slowed the process, it’s the pile of cash needed to secure financing that prevents many would-be buyers from becoming homeowners, says Susan Dewey, executive director of the Virginia Housing Development Authority. “For first-time home buyers, generally the biggest obstacle to buying a home is the ability to have a down payment,” she says. Consumers struggling to come up with a sufficient down payment, however, may have more options than they realize, as government programs, existing assets, and personal finance techniques can be used to obtain the capital. Here are nine ways that consumers can get their hands on the down payment cash they need to purchase a home.
Click here to find out more!

[Slideshow: 9 Smart Ways to Come Up with Down-Payment Cash.]

1. VA, USDA: Veterans, active duty personnel, as well as some members of the National Guard and military reserves can qualify for zero-down-payment mortgages through the U.S. Department of Veterans Affairs. Such home loans are made by private lenders but backed by the agency. Although participants in this program must pay a so-called funding fee, its costs can be rolled into the loan. Closing costs, meanwhile, can be paid by the seller. “Essentially, the veteran can get into a home with no money out-of-pocket and the interest rates are typically very good,” says Paula Miller, the Region 3 vice president for the National Association of Realtors. To qualify for the program, borrowers must meet the agency’s income and credit standards. For more information, contact a VA-approved lender, one of the agency’s regional loan centers, or a Realtor. Similar zero-down-payment mortgages are also available through the United States Department of Agriculture Rural Development program. To determine eligibility, contact your local rural development office.

[Slideshow: 10 Places to Reinvent Your Life in Retirement]

2. State programs: Consumers can also get down-payment assistance through their local state housing finance agency. Although offerings vary by state, such agencies can help first-time buyers by providing grants, subsidized home loans, and other programs, says Dewey, who also serves as the president of the National Council of State Housing Agencies. The Virginia Housing Development Authority, for example, can provide eligible first-time buyers with federally-insured home loans that include second mortgages to cover the down payment and closing costs. “We can finance slightly above 100 percent [of the purchase],” Dewey says. Such buyers must meet requirements on credit, income, and home sales price. To find out if you qualify for similar assistance, contact your local state housing finance agency. (A directory can be found here.)

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3. FHA: Borrowers who aren’t eligible for such zero-down-payment mortgage programs can still obtain low-down-payment home loans through the Federal Housing Administration. The FHA is a federal agency that insures private lenders against default. Qualified borrowers can access FHA-backed mortgages for as little as 3.5 percent down. These liberal requirements have helped turn the once-sleepy agency into an essential component in the effort to revive the housing market. Although FHA-insured loans represented just 3 percent of the home-purchase mortgage market in 2006, the agency backs about 30 percent of home-purchase loans today. FHA-backed loans are subject to credit and mortgage-size requirements. To see if you qualify, contact an FHA-approved lender near you. (A directory can be found here.)

4. Gifting cash: If you don’t have enough down payment cash on hand, a good first step is to see if anyone close to you does, says Keith Gumbinger of HSH.com. “Do you have anybody who can give you money—your parents, a rich uncle, or your grandparents?” Gumbinger says. Gifts from parents or other family members have long been a source of down payment cash for young couples or first-time buyers. “Those gifts have to actually be documented as gifts,” Gumbinger says. “You must get something [in writing] from each of those donors that says there is no obligation to pay back the money.” Be aware, however, that cash gifts from a single source that exceed $13,000 per individual—or $26,000 per couple—are subject to federal taxes. (Go here for additional details on gift taxes.)

5. Tap your IRA: Certain home buyers can use funds from their IRA to cover down-payment costs without incurring the 10 percent early withdrawal penalty
. Individuals who are under age 59½ and have not owned a home within the preceding two years can withdraw up to $10,000—penalty-free—from their IRA to put toward a real estate purchase. The cash can be used for acquisition, financing, or closing costs associated with the purchase. Retirement savings, however, should not be the first place you look for cash. Only take money from your IRA after exploring all alternatives. (Go here for additional details.)

6. Use your 401(k): Although would-be home buyers may be able to access cash from their 401(k) for a down payment on a principal residence, they must first demonstrate a severe financial hardship. Many financial advisers advise against withdrawing funds from your 401(k) unless you have exhausted all other options. (That’s your retirement nest egg, after all.) In addition, some 401(k) plans allow participants to borrow a portion of the funds they’ve saved up to cover a down payment or other expenses. Plans that permit such loans typically provide access to as much as half of the vested account balance, not to exceed $50,000. But once again, home buyers should consider tapping their 401(k) for down payment cash only as a last resort. (Go here for additional details.)

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7. Savings plan: Although it might take a little time and discipline, an old-fashioned savings plan can be a great way for consumers to put together enough cash for a down payment. For assistance in creating a savings plan, consider reaching out to a certified credit counselor, says Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling. “To have an objective third party look at your finances and find hidden money within your budget is a super idea,” Cunningham says. “They can find things which you may not have thought of.” (Go here to find a certified credit counselor near you.)

8. Selling assets: Some of your down payment cash could be sitting right in front of you, Gumbinger says. “You may consider looking through all of the stuff that you have accumulated and see if there are things that you might be able to sell that you don’t need,” Gumbinger says. “If you have got three flat screen TVs in your apartment because they were cheap and you just started accumulating them, see if you can’t get rid of some of those assets and see if they can be turned into something that’s going to be more productive for you.” Once you’ve assembled an inventory of items you would be willing to sell, consider holding a garage sale or putting them on eBay.

9. Second job: Additional income, of course, can also help would-be home buyers save enough cash for a down payment. But with the national unemployment rate at 9.5 percent, such work may be difficult to find. Still, it’s worth seeing if there is any freelance work you might be able to take on, or checking with your friends who work in retail to see about any part-time openings.

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Real Estate 2010: House Prices in Chicago and the Suburbs

DÉJÀ VU: Declining prices have sent home values back to where they were eight years ago. So what’s your house worth now? Chicago magazine’s annual real-estate charts track home prices in nearly 300 neighborhoods and towns

By Dennis Rodkin

President George W. Bush launches the Department of Homeland Security, Denzel Washington and Halle Berry take home best acting Oscars, and 12 European countries adopt a new currency called the euro. Welcome to 2002.

At least that’s how it must feel to many local residents as home values here hover at about the same point they were in the second year of the new millennium. For much of 2010, the Case-Shiller index, a reliable gauge of home values, has been reporting sales figures for the Chicago area that are the same as it showed in 2002.

Of course, that is a regionwide measure. Chicago’s annual real-estate charts (which begin on page 84) don’t send every local community back to 2002, but the charts’ statistics do echo Case-Shiller in some places. In the O’Hare neighborhood, on the Far Northwest Side, for instance, Chicago’s October 2002 chart showed an average home-sale price of $319,800; this year, it’s $318,042. Eight years ago, condos in Rogers Park were averaging $160,145; they climbed to a peak price of $231,801 in 2007, but this year they are back down to $164,131, only 2 percent above their 2002 level. In the suburbs, the average 2010 prices in about a dozen towns (including Gurnee, Homewood, Kenilworth, Niles, and Riverwoods) are within a few percentage points above or, more commonly, below their 2002 counterparts.

Declines in home values are evident throughout this year’s charts, which track local home sales from July 1, 2009, to June 30, 2010, in 288 neighborhoods and suburbs. In 148 of those communities, the average sale price of single-family homes dropped by more than 10 percent when compared with last year—and in 26 of those suburbs and nine neighborhoods, the drop was larger than 20 percent. Of course, that followed big price decreases over the past two or three years.

A few locations did see their average sale prices go up, but those increases were essentially compensatory. Only 13 suburbs and 11 city neighborhoods enjoyed increases of more than 1 percent (below that, it’s more accurate to say that prices were flat), and virtually every one of those communities had endured some of the bigger drops in our 2008 and 2009 charts. For instance, Avalon Park, on Chicago’s South Side, saw prices go up by 14.01 percent this year—but the neighborhood experienced a 35.6 percent drop last year and a 16.86 percent drop the year before that. In the northern suburbs, Lincolnshire is up by nearly 7 percent this year but dropped 26.23 percent last year. The story is the same in about 20 other locations, where prices have gone up, yes, but from way, way down.

Chicago’s data, which extend back to 1994, reveal several places where homes are selling not only below their 2002 prices but also below their 1994 prices. They are largely moderate- and low-income communities—among them, Burnham, Calumet City, and Maywood in the suburbs, and Englewood and Roseland in the city. Job losses and the foreclosure crisis hit these areas especially hard, and residents there with few other resources can hardly afford another setback. (During the next few weeks, I will more closely examine data from the charts in the Wednesday “Housing Bulletin” at my thrice-weekly blog at chicagomag.com/dealestate.)

While prices are down, the number of home sales is up in the majority of the towns and neighborhoods on the charts. That’s a point not to be overlooked: Houses are still selling, and in fact this year they sold in larger numbers than last year. In the six-county metropolitan area, 77,792 homes were sold from July 1, 2009, to June 30, 2010, according to Midwest Real Estate Data (MRED), which provided the information for our charts. That’s a 29 percent increase from last year. Each one of those sales potentially provides a small boost to the sputtering economic recovery, with attendant purchases such as new rugs, lamps, and other furnishings.

And who could blame a home-buyer for splurging a bit on décor when the house itself came at such an attractive price? Low prices and cheap mortgages have made this a fantastic year for buyers—that is, if they could get a loan. Next year, conditions may be even better for buyers if there are further drops in the market.

Bargain-basement deals have attracted buyers at all price points—and in all neighborhoods. In the spring, Ron Huberman, the CEO of the Chicago Public Schools, paid $898,000 for a house in Chicago’s Lincoln Square that had previously been mortgaged for about twice that amount. Tom Waddle, the Fox Chicago sports analyst and former Chicago Bear, bought a new house in Lake Forest for $3.25 million—only 48 percent of the $6.7 million that the home’s builder had originally wanted for the place.

In communities where there have been numerous foreclosures and distressed sales, the charts may paint a bleaker picture than actually exists for the financially stable homeowner who’s not looking to sell. In August, the Chicago Tribune’s Mary Ellen Podmolik reported that 35.2 percent of home sales in Cook County during the first quarter of 2010 were foreclosure related. She noted that research from the Cook County assessor revealed that, while the countywide median sale price had dropped by 21 percent, prices in the “pure,” or nondistressed, market were down by only 6.7 percent.

Chicago’s charts do not separate distressed properties from other sales. MRED does not make that distinction. More important, if you are planning to sell these days, there are foreclosures and short sales occurring in almost every community, and those distressed sales—usually at lower prices—will be in competition against your sale.

What’s to come? Nobody is certain, but by late summer, suggestions of further declines were gathering. In late August, the Illinois Association of Realtors released data showing that the number of home sales in the Chicago area had declined by 25.1 percent in July (a drop not reflected in the time span of our charts). The association attributed the decline, in part, to the end of the government’s home-buyer tax credit. With that in mind, the best plan for homeowners might be to hunker down, bide their time, and convince themselves that 2002 wasn’t such a bad year after all.

This article appears in the October 2010 issue of Chicago Magazine.

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Things to do in Chicago this weekend …

10 Things to do this weekend
By: Margaret Littman August 26, 2010

LISTEN. The Queen of Rockabilly (and rumored one-time Elvis sweetheart) WANDA JACKSON shakes things up at FitzGerald’s on Friday. Catch this Rock and Roll Hall of Famer live and in concert. Aug. 27, 9:30 p.m. Tickets are $15. 6615 Roosevelt Road, Berwyn, (708) 788-2118, www.fitzgeraldsnightclub.com.

LAUGH. “WEIRD AL” YANKOVIC brings his brand of parody and humor to the McAninch Arts Center at College of DuPage. This is not just Dr. Demento stuff. Mr. YANKOVIC has continued to skewer new pop icons and will publish a children’s book in the spring. Aug. 29, 7 p.m. Tickets are $50 – $85. 425 Fawell Blvd., Glen Ellyn, (630) 942-4000, www.atthemac.org.

SAIL. Live music from Tecora Rogers and the Chicago Spirituals combine with great views and good food during an AFTERNOON GOSPEL LUNCH CRUISE on Lake Michigan. Cruises leave from Navy Pier. Aug. 28, 3 p.m., board, 3:30 p.m., set sail. Tickets are $44.90, $22.45 kids ages 3 – 12-years-old, reservations required. 401 E. Illinois St., (866) 273-2469, www.spiritofchicago.com.

ROMP. The city’s dog-friendliness will be celebrated this weekend with the second annual DOG DAY ON THE GREEN at Montrose Harbor. Activities include dog yoga (a.k.a. doga), a dog fashion show, pet tricks plus other contests and giveaways. Bring four-legged friends on leashes. Aug. 29, 9 a.m. – 4 p.m. Free. 4400 N. Lake Shore Drive, dogdayonthegreen.com.

WATCH. Many of the performances during the Chicago Dancing Festival sold out of their free tickets in record time. But Saturday’s CELEBRATION OF DANCE show at the Jay Pritzker Pavilion is open for eyeballs wanting to see Alvin Ailey II, Ballet West and others. Arrive early: Because tickets are not required for this show and other performances have sold out. Aug. 28, 7:30 p.m. Free. Michigan Avenue and Randolph Street, www.chicagodancingfestival.com.

PREVIEW. Local fashion designers, outdoor shopping and an outdoor fashion show come together with live music and food and drink during the day-long MO’ ROCKIN FASHION FEST. Red carpet photo shoots and local celebrities will give the day that added Hollywood-style flare. Aug. 28, 11 a.m. – 10 p.m. Free. 1824 W. Division St., (773) 862-8686, www.morockinfashionfest.com.

BROWSE. Beeline A-Line skirts, made from vintage fabric finds, will be one of the artisan goods on display at this weekend’s BUCKTOWN ARTS FEST. Check out the arts and crafts (and music and poetry) for a back-to-school binge. Aug. 28 – Aug. 29, 11 a.m. – 7 p.m. Free. 2300 N. Oakley Ave., www.bucktownartsfest.com. Above: Joachim Knill’s “Opera Building.”

REMEMBER. Light Opera Works brings RODGERS AND HAMERSTEIN’S CAROUSEL to the Cahn Auditorium. Catch the classic romantic musical, performed with the help of a 30-piece orchestra. You already know lots of the lyrics, such as “June is Bustin’ Out All Over.” Aug. 28, 8 p.m., Aug. 29, 2 p.m. Tickets range from $32 – $92, discounts for those under 21. 600 Emerson St., Evanston, (847) 869-6300, www.LightOperaWorks.com.

SHAKE. (or STIR…) Francesca’s Tavola mixologist Todd Poore will teach you HOW TO MAKE FIVE TYPES OF MARTINIS, including the Cactus Kick, the Concord Grape and others. Just in time for hosting an end-of-summer fete. Aug. 28, 2 p.m. – 4 p.m. Cost is $30. 208 S. Arlington Heights Road, Arlington Heights, (847) 394-3950, www.miafrancesca.com.

SCREEN. The SILENT FILM FESTIVAL comes to a close at the Portage Theatre with a showing of Mary Pickford’s “Pollyanna.” The West End Jazz Band provides pre-show live music and live organ music accompanies the screening. Aug. 27, 8 p.m. Tickets are $10. 4050 N. Milwaukee Ave., (773) 205-7372, www.silentfilmchicago.com.

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