New research suggests that today’s first-time home buyers may be passing up great deals because they insist on flawless “move-in ready” houses requiring little or no changes. A survey by Coldwell Banker Real Estate of 300 first-time buyers found that a startling 87% said that “finding a move-in ready home is important” to them. Zillow, a giant Seattle-based online real estate research and data company, suggests that any shift by consumers toward greater attention to home details may be an inevitable byproduct of today’s higher downpayment minimums and more stringent loan qualification requirements. According to Zillow researchers, the median downpayment in 11 major metro areas has jumped to 20%, compared with “close to zero” in some of the same areas just five years ago. In other words, first-time buyers today have to put a huge effort into coming up with their downpayment, and they want to make sure that equity investment goes into the house that will need the fewest and least-costly upgrades. Some agents suggest that buyers today tend to be hipper and more sophisticated about home design, furnishings, floor materials, countertops and appliances because they are exposed to far more information on cable TV than earlier generations. (www.washingtonpost.com)
Washington Post, (3/4/11); Kenneth R. Harney

The 30-year fixed-rate mortgage loan, the steady favorite of American borrowers since the 1950s, could become a luxury product if the federal government shuts down the housing finance giants Fannie Mae and Freddie Mac, housing experts on both sides of the political aisle say. Interest rates would rise for most borrowers, but urban and rural residents could see sharper increases than the coveted customers in the suburbs. Lenders could charge fees for popular features now taken for granted, like the ability to “lock in” an interest rate weeks or months before taking out a loan. The question is whether the government should preserve the benefits that the companies provide to middle-class borrowers, including lower interest rates, lenient terms and the ability to get a mortgage even when banks are not making other kinds of loans, or whether it should pull back, letting the market dictate, price, terms and availability. (www.nytimes.com)
New York Times (3/3/11); Biny Amin Appelbaum

With about 80% of Americans age 45 and older preferring to “age in place,” according to an AARP study, manufacturers and contractors are responding with new universal design products and technologies. “Boomers are more likely to improve than move,” said Dan Bawden, a Houston contractor. Building or remodeling with wider doorways, improved lighting, stepless entries and kitchens with waist-level access and pull-out storage often saves money in the long run, he said, adding, “An assisted living facility costs $60,000 a year and up — or you can spend that amount once and stay in the house you love for years.” Until recently, universal design was a neglected approach in the design industry. “Even 10 years ago, products for bath and kitchen were very institutional-looking with a lot of stainless steel and the stigma of disability,” said Rosemary Bakker, an interior designer and the author of “The AARP Guide to Revitalizing Your Home.” “Now, U.D. is getting cutting edge, even trendy.” Manufacturers have introduced grab bars that glow in the dark, furniture with higher seats and firmer cushions and rising-wall bathtubs with cascading waterfalls (which sell for $9,000.) In the last year, Masco Cabinetry, which is based in Ann Arbor, Mich., and makes kitchen and bath cabinets, countertops and vanities, has added models that reduce bending or reaching and provide easier storage access. (www.nytimes.com)
New York Times (3/3/11); Elizabeth Pope

Police in Portland, Ore., arrested nearly half a dozen people who they say stole millions of dollars worth of merchandise in one of the biggest theft rings they said they’ve ever come across. The home belonging to the theft ring leader is jacked up about 12 feet in the air by wooden blocks, house jacks and steel I-beams stolen from construction sites and suppliers across the metro area over the past couple of years. Police said the ring leader would choose targets, his accomplices would steal the items and then he would sell them online. Investigators said he was putting some of the stolen items into his home to renovate it. “This particular suspect would surveil businesses for items that he wanted to convert to his own use or steal and then sell,” said detective Jeff Bender with the Portland Police Bureau. “And in this case, these windows were of particular interest to him because of his building project that he was trying to advance.” (www.katu.com)
KATU (2/17/11)

Sales of vacation homes have begun to rebound from their lowest point in 2008, according to the National Association of Realtors®. And as travel also starts to rebound, the idea of owning a time share, fractional or vacation home is creeping back into the minds of many consumers. Second homes can be a house, condo or apartment located in any part of the world. While it’s a bigger upfront investment than a time share or fractional ownership and the owner is responsible for ongoing maintenance, it can be rented out to other vacationers to generate income. According to HomeAway.com, the average second home owner rents out their property about 20 weeks a year, generating more than $35,000 in rental income annually. The company also reports that about 32% of second home owners generate enough rental income to cover 75% to 100% of their mortgage payments. (http://beaconnews.suntimes.com)
Beacon News (2/27/11); Sun-Times Media Group

In the Chicago area, there are plenty of condo buildings that lenders won’t touch. Among the deal killers: too many renters in a building, pending litigation, inadequate association reserves and delinquent assessments. Those are some of the criteria lenders must look at in order to sell the loan to Fannie Mae or Freddie Mac or have it insured by the Federal Housing Administration, the first choice for many first-time home buyers. FHA use to offer “spot” loan approvals on individual condo units, but now entire buildings need to be FHA-approved. With its attractive 3.5% downpayment requirement, new and existing developments have lined up to apply for that certification, for which they have to reapply every two years. In Illinois since August, 61 buildings — from three flats to high-rises — were denied FHA approval for reasons ranging from outstanding litigation to the use of more than 25% of the building for commercial purposes. The situation is slowing any recovery in the condo market, often the housing of choice for first-time buyers. Owners in troubled buildings aren’t able to refinance, and sellers who want or need to sell find thin ranks of buyers. Last year, 42.5% of all initial foreclosures in the six-county Chicago area were against condos. (www.chicagotribune.com)
Chicago Tribune (2/28/11) Mary Ellen Podmolik