Real Estate Information and Homes For Sale

In December 2011, Congress reached a last-minute deal to fund the payroll tax cut extension. The payroll tax extension will provide a 2% tax reduction for individuals earning up to $106,800, so the tax extension will be very helpful for many Americans who are struggling during these tough economic times. But like so many things in our tangled economy, there's a flip side. In this case, the tax cut deal has a rippling effect that will impact the mortgage world.

Here's what's happening and what it means to home loan rates:

What is happening and why? To put it bluntly, the passage of the payroll tax cut extension is being funded via a mandate to Fannie Mae and Freddie Mac (the nation's largest providers of mortgage money) to increase their guarantee fees or "g-fee's" by at least 10 basis points on the rate. So rather than giving a par rate of 4.00%, for example, the par rate is now increased by at least 10 basis points, or approximately 4.10%. But as you probably know...home loan rates are priced and offered in .125% increments, so this will most likely impact the consumer by .125% in rate. Whether you agree or not on the politics behind this cost being passed along to folks who are taking out mortgages, the Congressional Budget Office recently estimated that the increase will ultimately pay for about $35.7 Billion of the cost of the payroll tax extension.

What exactly is this "g-fee"?

The guarantee fee or "g-fee" is an amount charged by mortgage-backed securities (MBS) providers, like Freddie Mac and Fannie Mae, to help protect against credit-related losses in the overall mortgage portfolio. In other words, it acts a lot like insurance and helps lower the overall risk...which means home loans can be offered at terrific interest rates to borrowers that have good – but not perfect – credit.

What exactly is the impact of the rate increase? 

For example, for a $200,000 home loan, the increased g-fee (assuming a .125% increase in rate) would equate to $250 more per year in interest, or $7,500 more over 30 years. Someone buying or refinancing a home can certainly choose to buy down the cost with cash up front – but most folks will not do this.

Who will this impact?

The change will impact all new borrowers of Fannie Mae and Freddie Mac loans. The bill will also impact Federal Housing Administration (FHA) loans by increasing the annual mortgage insurance premium that borrowers pay by one-tenth of a percent.

When will it start? 

Officially, the increase to guarantee fees will begin on April 1, 2012. However, the increase is already starting to be seen in rate sheets right now, since home loans being originated now will likely not be closed, pooled and securitized until April.. .and therefore will need the increased g-fee priced in earlier.

How long will this be in effect? The increase will be effective through October 1, 2021.

The bottom line is that the g-fees will be going up... and this will impact homebuyers looking to obtain a home loan through Fannie Mae, Freddie Mac and FHA.

The good news is that home loan rates are still at historic lows right now, and it's a great time to purchase a new home or refinance. If you or anyone you know has any questions, please call or email!

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

HomeGain.com, an online real estate marketing firm, recently released a study on homeowner satisfaction. HomeGain found that homeowners with the lowest cost basis were the happiest. Specifically, HomeGain found homeowners who acquired their properties for less than $75,000 were the most satisfied.

Now, HomeGain's survey might seem like an exercise in belaboring the obvious, but it's proof that price really does matter. Despite what has occurred in housing over the past four years, if you purchased a $75,000 home a few years ago, you're likely ahead on your purchase (which is why you're satisfied).Though it might be obvious, HomeGain's point is, nevertheless, worth driving home to our clients. Price matters, and it matters a lot. Buying at a sufficiently low price can offset many sins.

Low prices are found mostly in depressed markets, which is the housing market today. Depressed markets are ephemeral, so if we want to maximize our clients' happiness in 2020, it behooves us to impress upon them the importance of buying today.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

The data on housing were mixed this past week, but we would say that, for the most part, they listed more positively than negatively.

Last Friday, the NAR reported sales of existing homes rose 5 percent to an annual rate of 4.61 units in December. This marked the third-consecutive month of sales growth. This latest increase helped reduce inventory to 2.38 million units, the equivalent of a 6.2 month supply at December's sales pace.

Pricing was the one bugaboo in the NAR's data. The median price for an existing home was $166,100 for 2011, a 2.5 percent drop from 2010 and the lowest median price since 2002. This is a disappointment, but hardly a disaster. We’ve said many times that national numbers usually lack a meaningful connection to local markets.

The news on distressed properties was a little more encouraging. RealtyTrac reports that homes in some stage of foreclosure dropped 11 percent in the third quarter of 2011 compared to the previous quarter. Of course, part of the improvement is due to the ongoing matter of banks working through last year's auto-signing imbroglio. That said, our own anecdotal evidence suggests an improving distressed-property market.

The new-home market is also improving, just not so obviously. New home sales eased 2.2 percent to an annual rate of 307,000 units in December, which pushed inventory up to a 6.1 month supply. Like existing-home prices, new-home prices were also pressured for the month, with the national median price dropping to $210,300.

Recent new-home data suggest that December's numbers might just be a hiccup: Homebuilder sentiment has improved markedly in recent months, as has the longer-term sales trend.

Speaking of trends, the trend in mortgage rates is expected to hold for the long term. On Wednesday, the Federal Reserve stated that interest rates will remain low until at least through 2014, pushing back a previous date of mid-2013. According to Federal Reserve data, the economy simply isn't growing at the pace it had expected.

The impact of the Fed's revised policy was both immediate and palpable. Before the announcement, the 10-year Treasury note yield had been creeping higher and was yielding 2.06 percent just before Fed Chairman Ben Bernanke stepped up to the mike. After he had stepped down, the yield had dropped to 1.96 percent.

So it appears low base mortgage rates are with us for the long term, but that doesn't mean low-cost mortgages are. A recent increase in fees Fannie Mae and Freddie Mac charge lenders will push costs higher. Expect the fee increase to raise borrowing costs a quarter percentage point.

It's worth pointing out that we said “appears” in connection with low mortgage rates. Nothing is certain where the economy and investor behavior is concerned. To be sure, if we were forced to place a bet, we’d likely bet on January 2013 mortgage rates matching January 2012 rates. We suspect most everyone else would place that same bet. That fact, in and of itself, is a contrarian indicator that rates aren't necessarily destined to stay at today's levels. 

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

Last week we reasoned that it would be years before housing activity would return to levels seen in the mid-2000s. That's not such a bad thing; the mid-2000s proved to be an unsustainable bubble market.

We also said markets are on the mend, which is why we expect 2012 to be a more active and a more remunerative year for those of us in the real estate and mortgage businesses. Even CoreLogic, which has a history of focusing on negative data, recently reported that improved employment, more liquid households, and record home affordability levels could ignite a minor housing recovery in 2012.

Not to pat ourselves on the back, but we've been beating the drum for a sustained housing recovery (not a minor one) since the beginning of the fourth quarter of 2011. We didn't embrace this position because of any special prescience; it was just a matter of understanding basic economics. Markets drop only so far and then they rebound. The data last year suggested the bottom was near and markets were set to turn. That's proving to be the case, and we expect that to continue being the case for this year and years to come.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

If you meet a home builder, don't be surprised if his gait is imbued with a little more pep and his voice tinctured with a little more enthusiasm, for his mood has likely been lifted by optimism these days.

The latest home builder sentiment index shows that builders are expecting more construction, more sales, and better pricing for 2012. The index moved up an impressive four points to 25 in January. This is the best reading since mid-2007 and marks four-consecutive months of sentiment improvement.

A cynic might counter that home builders are getting ahead of themselves. After all, housing starts did fall 4.1 percent, to an annualized rate of 657,000 units, in December. That said, a few details are worth exploring. November was an unexpectedly strong month for starts, and the fact remains that December's starts still adhere to an established uptrend. If you look back to February 2010, you'll see month-over-month improvements revealed in higher lows and higher highs.

Permits suggest more of the same going forward. Permits in December inched up 0.1 percent to an annualized rate of 679,000 units, which is a 7.8 percent improvement over December 2010. The gains aren't spectacular, to be sure, but we're not looking for spectacular, we're looking for sustainable. We think the gains are sustainable.

The trend in mortgage purchase applications has been encouraging to both home builders and existing-home sellers. Purchase applications jumped 10.3 percent in the January 13 week, the best posting in a month. Removing the holiday hiatus, the trend in purchase applications has been mostly up over the past few months.

The trend in refinance applications has also been up, and to a much greater degree than purchase applications. Refinance soared 26.4 percent in the latest reported week, hitting an activity level unseen since August 2011.

Mortgage rates inching lower to another multi-decade low was one factor in the surge in mortgage activity. But the increase in fees for loans purchased by Fannie Mae and Freddie Mac starting April 1 is the more influential factor. This increase translates to a 0.125 percent to 0.25 percent increase in mortgage cost (though some pundits argue that longer-term these are low-end estimates). The fees are already being implemented, but they've been offset by the mortgage-rate drop that has occurred over the past month.

We think the days of record-low mortgage financing are numbered. Fannie's and Freddie's fee increase will obviously raise costs. The revamped version of the Home Affordable Refinance Program, HARP 2.0, will also pressure mortgage rates higher due to a surge in mortgage demand: rising demand usually means rising costs.

Bottom line: we think it's advisable to act now on a refinance or a purchase to avoid the possibility of getting tangled in a refinance boom that many industry watchers are expecting to emerge in the next month or two.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

To say that the Harrisburg PA real estate market was a challenge may be an understatement. In the news there were the continuous reminders that the market was not what it was four or five years ago. And although we had to work our way through all the negatives, such as short sales, foreclosures and buyers not being able to obtain financing our market was pretty resilient.  For the month of December 2011, total sales were down 3% compared to December 2010 and the average sales price decreased 4% for the same period. For the full year of 2011 the number of sales decreased 6% and the average sales price declined by 4%. When compared to a majority of areas in the United States these numbers would have been hailed as a great year. But there are some head winds ahead before we see a reversing trend of the last few years. Most likely there will be a greater number of foreclosures and short sales in 2012 which could negatively impact values for a period of time but even though these two items have been impacting our market to a degree there were buyers and homes were being sold. So I am anticipating by the middle of the year we may reach a stable market and although I don’t see a substantial upturn in the average sales price we will begin to see some positive results in the second half of the year.

What does it take to sell a home with a almost record high number of homes on the market and the average time extending? Your home must be seen through the prospective buyers’ eyes and what do they perceive the value in your home. It doesn’t matter what the neighbors home sold for a year ago or what improvements you have made the buyer will determine the value or they are off to see some of your competition. That is the harsh reality of the Harrisburg PA real estate market today but as I say that I have heard of multiple offers on certain homes in all price ranges. So my recommendation is hang in there and if you are considering the sale of your home you are probably going to be able to purchase a home that two years ago you thought was out of your price range. So there is hope as a buyer and seller when you also take into consideration of the extremely low interest rates available today. Please look below the chart for some additional assistance.

West Shore

School District             2010                             2011                 Days on Market

Camp Hill                                 $215,883                       $203,863           63/109

Carlisle                                    $154,839                       $169,884           81/110

Cumberland Valley                  $276,633                       $268,674           109/143

East Pennsboro                       $130,418                       $202,236           86/82

Mechanicsburg                        $226,874                       $191,669           110/111

Northern                                   $175,276                       $212,333           65/105

West Shore                              $167,412                       $184,375           104/124 

East Shore

School District             2010                             2011                 Days on Market

Central Dauphin                       $172,623                       $179,880           89/86

Harrisburg                                $ 60,680                        $ 50,400            134/145

Lower Dauphin                        $219,950                       $295,000           53/162

Derry Township                        $189,216                       $264,355           103/72 

Middletown                              $154,048                       $111,686           114/66

Steel High                                $ 51,443                        $ 31,500            122/119

Susquehanna Twp                   $153,279                       $131,405           111/159

You can go to my web site, www.DonRoth.com and click on the search listings tab and you have the ability to preview ALL active listings in any region of the area. Or if you would like contact me and I can establish an Neighborhood Activity Report which will provide you with a periodic report near your home to monitor recent activity. I have said before that we would be exiting this down turn and now I really believe that we are near the beginning of a normal Harrisburg PA real estate market. 

We are always keen to accentuate the positive; we are also keen to accentuate reality. The reality is that a return to 2006-era home prices and transaction activity likely resides in the distant future.

We looked at other bubbles that have burst – the stock market in 1929, the gold market in 1980, the tech market in 2000 – and found that it can take years, if not decades, for the market to return to pre-bubble levels. As we all know, the housing bubble burst in full in late 2007/early 2008 and prices tumbled hard over the subsequent three years.

The good news is that the hard sell-off that marks a bursting bubble is an acute not a chronic event. That means once the sell-off is complete, the healing process begins and markets move forward, thought at a relatively slower pace compared to the pre-bubble pace.

The frustrating aspect of the recovery is that little can be done to accelerate it. To be sure, the housing market is recovering, but it's going to be awhile before it reaches the level of activity we were accustomed to a few years ago. Keeping that fact in mind not only helps mitigate frustration but also helps us stick to our guns as we focus on the long-term trend, which, fortunately, will be up.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

It's really all about the economy at this point. Fortunately, the economy is moving forward, albeit at what too-often seems a plodding pace.

But moving forward we are. The Federal Reserve noted as much in its latest rendering of its Beige Book, a report of anecdotal evidence of economic progress in the dozen Fed districts. The Beige Book states, "Compared with prior summaries, the reports on balance suggest ongoing improvement in economic conditions in recent months, with most districts highlighting more favorable conditions than identified in reports from the late spring through early fall.

”Now, that attempt to say something without saying too much doesn't really enlighten, but it does affirm what we've known all along – the economic recovery is progressing.

Home prices might also be progressing better than the national numbers suggest. Zillow Inc. reports home prices were flat in November, with the average national home price at $147,800. But the housing market is a local market, and local markets appear to be improving better than the national numbers report (which can be skewed by outliers, e.g. Las Vegas ).Of the 165 housing markets tracked by Zillow, 60 percent reported stable or appreciating home values in November. Notable winning locales include Los Angeles, Washington D.C, Miami , San Francisco , and Detroit.

The flow of private money into housing is also encouraging. We've noted over the past month that hedge funds, investing platforms for the wealthy, are directing more funds into housing stocks. In addition, Robert Shiller, co-inventor of the S&P/Case-Shiller Real Estate Index, noted at a recent American Economic Association function that the futures market for real estate (basically bets on the direction of home prices) is pointing to rising prices.

We expect interest in residential real estate to further bloom in 2012. Homes are enticingly affordable these days. U.S. Department of Housing and U.S. Treasury Department data show that home affordability is at a level unseen since 1971. In fact, median-income families today have double the funds needed to cover the cost of owning a home than they did 40 years ago.

Historically low mortgage rates also contribute to the affordability quotient, and rates continue to skim along the bottom, as they have done for the past two months.

But rates aren't the only consideration in the cost of a loan. Fees come into play. Unfortunately, borrowers face higher fees in the near future. The guarantee fee on loans sold to Freddie Mac and Fannie Mae is set to increase a minimum of 10 basis points effective April 1. Many industry watchers, though, expect the actual cost to fall within the 20-to-80 basis-point range.

Today, affordability is at a multi-decade high, and mortgage rates are at a multi-decade low. We see few economic reasons for anyone in the market for a mortgage and house not to take the plunge.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

Sales recorded for the Central Penn Multi List decreased by 4% for all homes recorded including Perry County, portions of Lancaster, Lebanon and York Counties.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.

Housing is still dealing with some difficult issues – namely shadow inventory and negative equity. The former has shown much improvement based on data released during the last quarter of 2011; the latter will be helped by HARP 2.0, which is expected to be fully engaged by March.

The good news is economic and job growth will continue to remove rot from the system; that is, if buyers and borrowers are sufficiently motivated to act. Unfortunately, we see too few buyers and borrowers sufficiently motivated. The one question we field most often these days is, “Are mortgage rates going lower?” Embedded in the question is the belief that rates are going lower, which keeps too many people on the sidelines.

Our wish list for this year includes a stronger economy, more jobs, and more confident consumers. We'd also like to see a ratcheting up of interest rates. That way, borrowers prone to procrastination will be less prone to procrastinate when they realize that any uptick in rates won't be followed by two downticks.

What's more, rising rates will be indicative of the sustained economic growth we all want.

Courtesy of Jessica Regan.

Search all Harrisburg PA homes for sale.

When you are buying or selling property in today's Harrisburg PA real estate market, it's important to have confidence in your real estate professional. Don’s commitment as your Harrisburg PA REALTOR® is to provide you with the specialized real estate service you deserve.

When you are an informed buyer or seller, you'll make the best decisions for the most important purchase or sale in your lifetime. That's why Don’s goal is to keep you informed on trends in Harrisburg PA real estate. With property values continuing to rise, real estate is a sound investment for now and for the future.

As a local area expert with knowledge of Harrisburg PA area communities, Don’s objective is to work diligently to assist you in meeting your real estate goals.

If you are considering buying or selling a home or would just like to have additional information about real estate in your area, please don't hesitate to call me at (717) 657-8700, complete my online form, or e-mail me at don@donroth.com.