Autumn Greetings!

   Pretty fall mums with pumpkins scattered about, v-shaped formations of geese making their happy sounds on their journey south, cooler breezes and sunny days, black and gold and many other sporting events, Live-at-Five Downtown, pumpkin parties, and up-coming Heavenly Art Exhibition on November 14th at Sarah Gillespie Art Museum at William Carey – these are reflections of this Hub City Autumn of 2013.

   These reminders of our blessings help us to “look up” rather than looking  around at the alarming events of recent weeks – both local and national. This week’s “ Make A Difference” campaign is a step in the right direction.

   Larry “Doc” Harrington, father of our dear friend Brigadier General Larry Harrington, led a most exemplarly life. Several generations of USM athletes and thousands of Army officers have been impacted by his model. His devotion to USM aided in bringing about an economic boost to the school equalling millions of dollars.  

  Our goal with each Star Chat edition is to provide some local and national information impacting the real estate industry – especially focusing on our homes and residential real estate investments.  This article focuses on the realities of ObamaCare, the recent government shut down, and other economic factors affecting the current real estate market.

 

Housing affordability is at 156 which means good market conditions for buyers.

Interest rates have been bouncing between 4.3% to 4.7% and are projected to be 5% by spring of 2014.

Local residential MLS supply is 8.84 months.

Average days on the market for the area MLS is 95.4 days; average for our team is currently 69 days.

Foreclosures Sales in our local MLS closed year-to-date are 299 of the total 1237 single family houses sold or 24.1%. Nationwide the foreclosure  accounted for only 14% of the September sales. This directly correlates with the fact that our area entered the recession period behind other parts of the US; and we are trailing coming out.

Locally and nationally we are experiencing delays in processing loans which is a direct result of the government shutdown.

USDA financing is frozen now and we do not know when it will be funded.  Our team currently has two sellers and buyers who cannot move toward closing. This delay costs everyone concerned; and of course this delay will cause some contracts to terminate.

Higher flood insurance rates went into effect October 1st.  Realtors nationwide have reported approximately 10% of transactions in September were located in flood zones, and that one out 10 of those transactions were delayed or canceled due to concerns over rising flood insurance rates. Another issue is the ever-expanding boundaries of FEMA’s flood zones.

The 3.8% and .09% new taxes designed to fund $240 billion over the next ten years into “ObamaCare” and Medicare became effective January 1, 2013. For the 95% of Americans who make less than $200,000 as individuals or $250,000 as a couple adjusted gross income, the tax does not apply.

Gains on a personal residence will seldom be affected because the tax is on gains exceeding the $250,000 individual exemption or $500,000 exemption for a couple.

The 3.8% or .09% will more often apply to the sale of second or third homes, investment property or inherited property. It applies on interest, dividends, rents and capital gains. Below is an example of a how this may apply to certain individuals.

 

Always, when considering any real estate transaction, whether it be buying or selling, get advice from your own tax professional.

 

 Thank you again for your many acts of kindness, loyalty, and encouraging remarks to us and to your friends and family.  We always want to hear from you anytime we can be resourceful or helpful.

 

Blessings to you and your family,

 

 

DeLois and Team