Things are starting to change...

Thanks to CNN Money for this one. (Sorry for the bold)

Home prices up for 1st time in 3 years

Index of 20 major cities rises on a monthly basis for the first time since July 2006, hinting that the worst of the declines may be over.

NEW YORK (CNNMoney.com) -- The value of U.S. homes grew on a monthly basis in May for the first time in nearly three years, according to 20-city index released Tuesday.

The month-over-month increase was 0.5%, according to the report from financial data company Standard & Poor's and economists Case-Shiller. It was the first increase in the monthly index since July 2006.

On an annual basis, home prices in the 20 cities fell 17.1%, but it was the second straight month that the year-over-year decline lessened.

"This could be an indication that home price declines are finally stabilizing," said David Blitzer, chairman of the index committee S&P, in a prepared statement.

While acknowledging that the report was good news, Mark Zandi, chief economist for Moody's Economy.com, downplayed the importance of a single month's statistics.

"I think it's a temporary respite," he said. "It reflects the recent decline in foreclosure sales, and prices will continue to fall over the next several months."

Robert Shiller, the Yale economist who co-founded the index and who's famous for warning that the housing boom was, in fact, a bubble, said the decrease in foreclosure sales does show up in the index statistics as a plus for home prices. That's one reason he did not want to sound too optimistic; foreclosures could take off again.

"And we could get more economic bad news, but it does look encouraging," he said.

He added that he thought that Washington's efforts have boosted the nation's spirits, an important factor for the housing market.

"The government has done a lot to support the housing market," he said. "Confidence has improved. People are talking about 'green shoots.' People are thinking it's time the recession came to an end. The stock market is up."

Cleveland gains: The improvement in the index was as broad as it was deep, with 13 metro areas showing gains, compared with eight in April. Two, New York and Tampa, Fla., showed no change.

The biggest winner was long-suffering Cleveland, where prices rose 4.1%. The city still falling the most was Las Vegas, where prices declined 2.6%.

The report added to the list of positive housing market indicators. These include rising new home sales, increased home building and increased pending sales.

Paul Bishop, the managing director of research for the National Association of Realtors, was glad to see the upturn but did not want to overemphasize the results of a single month, saying the economy is not out of the woods yet.

"Job losses could continue after the recession ends," he said. "That's where the economy intersects with consumers in the most tangible way. Until consumers have some level of confidence that the economy is improving, many will be reluctant to buy."

Washington's goal: Stabilizing the housing market has been a primary goal of Washington policy makers. Congress has tried to stimulate homebuying by creating a temporary tax credit of $8,000 for people who have not owned a home for at least three years.

The administration has also tried to tackle the foreclosure problem, creating a program to help mortgage borrowers avoid defaulting on their loan payments and losing their homes.

Zandi added that lenders are still figuring out the administration's foreclosure prevention plan, and have suspended the foreclosure process for many borrowers in default. That means fewer distressed properties, which tend to bring in lower prices, than usual.

One of the most positive things the government has done, according to Shiller, was to take control of the failing mortgage companies Fannie Mae and Freddie Mac.

These were government sponsored enterprises that guaranteed a flow of mortgage lending by buying or backing mortgages in the secondary market. Without government backing up these companies, mortgage lending would have dried up, which would have devastated home sales.

Lower prices: Prices have also fallen so far in so many places that it's drawing people back into the market.

In Las Vegas, prices are off about 53% from their peak, set in August 2006. Phoenix prices are down 54%.

Overall, the 20-city index is down more than 32% from its high.

Interest rates were very low in May, which also could have helped the housing market. The rate for a 30-year mortgage was well below 5% during the month, which encouraged buyers and drove up demand.

Zandi is hopeful that the market is stabilizing. "It feels like the cycle is winding down," he said. "I think it depends on how well the mortgage modification plan will work and I'm guessing it will work reasonably well."

One possible scenario, according to Shiller, is that home price declines end and then nothing happens for several years, the "L-shaped" recovery.

"Then, we can stop talking about home prices and get onto more interesting topics," he said.

Look, up in the sky: green roofs - baltimoresun.com

Thanks to today's Baltimore Sun for this article. It really goes to show you what you can do to make your home more energy efficient. I hope that more people consider doing this for their homes!

Look, up in the sky: green roofs - baltimoresun.com

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Barclay redevelopment project could start next year

Here's an article courtesy of The Baltimore Sun. It's great to hear that something is finally going to happen with that area between Charles Village and the Station North Arts District.

Work could start early next year on the $18 million first phase of redevelopment of 268 city-owned properties in a blighted North Baltimore neighborhood south of Charles Village.

Developer Telesis Baltimore Corp., selected by city housing officials more than three years ago, has secured public financing to move forward with 72 affordable rental apartments and townhouses and hopes to start construction next year as well on for-sale housing, Catherine Simmons, a Telesis project manager, said Thursday.

The developer on Thursday presented a city design panel with one piece of the multi-phase plan - construction of 19 new, affordable rental townhouses in the 2100 and 2200 blocks of Barclay St.

The overall plan calls for $85 million in redevelopment of vacant lots and vacant and rundown rowhouses, including some public housing, in the Barclay/Midway/Old Goucher neighborhoods. It would be built in four phases over a decade and include rentals and homes for sale among an estimated 322 units. The area is bounded by North Avenue, 25th Street, North Calvert Street and Greenmount Avenue.

The goal is to stabilize the neighborhood, allowing current residents to stay while attracting new homeowners.

"The larger context is a real balance of affordable and market rate," Simmons said.

Additional parts of the first phase of rental redevelopment will include renovation of what is now a partially occupied public housing complex, Homewood House, in the 2200 block of Homewood Ave., and renovation of 14 rowhouses in scattered sites mostly on North Calvert, Barclay and 22nd streets to create 23 apartments. Homewood House would continue to include some public housing. The first residents of the rental townhouses would be able to move in about mid-2010, Simmons said.

Simmons said the project, which began seeking design approval Thursday before the city's Urban Design and Architecture Review Panel, is moving forward because the developers were able to secure low-income housing tax credits and rental housing funds through the state Department of Housing and Community Development.

Additional financing for the $18.2 million project is coming from the Housing Authority of Baltimore, to replace public housing, and through the Federal Home Loan Bank of Pittsburgh's affordable-housing program. Some of the rentals would be reserved for low- to moderate-income residents who meet income guidelines. Developers expect to close on their construction financing by the first quarter of next year, when they would start work.

City housing officials had selected Telesis in 2006 over two other finalists. The city hopes to improve the blighted area between Mount Vernon and Station North neighborhoods to the south and the Johns Hopkins University area of Charles Village to the north.

"It's a neighborhood with potential, but it has suffered quite a bit in [the last] 30 years," said Alistair Smith, project manager for Baltimore Housing. Recent development in the Charles North arts district and proximity to Penn Station and Hopkins' Homewood campus should help attract residents, he said.

Simmons said that Telesis invests in the communities it redevelops, owning the rental units and bringing in an affiliate company to manage them:

"By bringing in this real mix of homeownership and rentals and all different income levels and by Telesis coming in as a property owner, we can have a tremendous stabilizing influence ... and work in partnership with the community to bring people back into the neighborhood, he said."


What's also nice to see about this article is that a developer has actually managed to get some financing. Speaking to people in the commercial side of the real estate industry, they all say that things are pretty slow. Hopefully this is sign of things starting to turn around on the development front.

Potential homebuyers still wary

This is a good article to start off the blog. Thank you to the Baltimore Sun/Associated Press for this article from this past Sunday's Real Estate Section.

baltimoresun.com

Potential homebuyers still wary

Buyers see great deals, but fear of losing jobs and worries about selling current homes keeps them out of the market

Associated Press

July 12, 2009

WASHINGTON —

More than half of potential homebuyers say they're still not prepared to jump into the market, and fear of losing their jobs is the No. 1 reason, a new poll shows.

With unemployment at a 26-year-high and rising, nearly 53 percent of consumers who said they were planning to buy a home in the future cautioned they're not ready to take such a large financial step right now, according to the survey released Thursday by Realtor.com.

Nearly a third of potential homebuyers surveyed cited concern about their jobs as the main reason they would shy away from the housing market. Worries about selling their current home are stopping 16 percent of the prospective buyers surveyed, while just under 8 percent said they fear home prices will keep falling.

Americans recognize there are great deals to be had in the housing market, but many are in too much of a financial pinch at the moment to even think about buying.

"If I was able to buy, I'd definitely buy because this is the time to do it," said Mark Wells, 42, of West Chester, Ohio, who lost his job at FedEx Corp.'s freight division in February and has been looking for a job ever since. His wife makes $8 an hour working at a day care.

Wells has been renting since he skirted foreclosure two years ago by negotiating a short sale, in which his lender agreed to accept less than the total balance due on the mortgage.

Among those consumers who are interested in buying, the survey found, some believe that prices aren't going to fall further and others are looking to take advantage of government incentives designed to kick-start sales.

Nearly one in five potential buyers said they were interested in a deeply discounted foreclosed home, while nearly 15 percent said they want to receive a new $8,000 tax credit for first-time buyers or other state incentives. More than 15 percent said they don't expect prices will fall further, but many are still taking their time.

In Auburn, Mass., Chris Chaffee is looking for a lakeside vacation home for his family. Though there are many great deals on the market - some properties that once sold for more than $500,000 now listing for around $300,000 - he and his wife are in no hurry - because they don't expect prices to rise drastically.

"It's a great time to look around," said Chaffee, 39, who feels reasonably secure in his job selling medical equipment. Seeking a bargain, he said, "We're trying to keep our eyes open to any foreclosures."

While foreclosures dominate the housing market in parts of the country, two thirds of those surveyed said they'd be unlikely to buy a foreclosed property, primarily due to concerns about the often-slow process of closing the deal and the potentially high cost of repairs.

To many buyers, purchasing a foreclosure "feels a lot more complex" than other transactions, said Errol Samuelson, president of Realtor.com, an online real estate listing service.

The poll also found that Americans generally are skeptical about President Barack Obama's plan to alleviate the foreclosure crisis by giving the lending industry $50 billion in incentives to lower borrowers' monthly payments. Only 28 percent of those surveyed said the plan is working, compared with 41 percent who said it isn't and 27 percent who didn't know.

The survey was conducted June 19-21 by research firm GfK and involved phone interviews with 1,004 randomly chosen.

I think that there are a few things to take away from this article. The first is that this is a rather small survey, only 1,004 people. And the second point is that this was a nationwide survey, which makes it difficult to judge what is going in area markets (all real estate is a local.)

Nick

Welcome to the blogosphere!

Hello, hello, hello! I would love to welcome all readers and blogo-philes to my new and first blog. As the title indicates, this is Nick Hollick's Real Estate Blog. I'm Nick, a Realtor in Baltimore, MD and I am hoping to make this a great source of real estate information for anyone looking to find out more about Baltimore's real estate market. Feel free to comment on and discuss any topics that I post.