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Will light rail expansion help Mesa real estate market?

phx-light-railMesa Mayor Scott Smith has been driven to expand commerce and job opportunities in Mesa since he took over last year. Yesterday Smith discussed with reporters his desire to expand the METRO light rail into Mesa. It is hard to fathom how the city spent millions on bringing museums to and cleaning up downtown and then have the light rail stop just short of downtown. The light rail has far exceeded expectations for the amount of commuters they have received so far and expansion into Mesa would not only give riders a chance to get to the renovated downtown Mesa, it would also allow commuters a chance to move along the rail and commute to downtown Tempe or Phoenix.

The light rail is not the only thing the Mayor wants to expand into Mesa. Smith also wants to bring some Cactus League spring training to the city. Smith has been busy courting the Cincinnati Reds from Florida and the D-Backs and Rockies from Tucson.

Expansion of light rail, the addition of the Gaylord Resort and spring training ball can all help Mesa grow in the future. Any reason to make Mesa more of a destination attraction will help grow jobs and make the city much more desirable to live in.

Obama’s housing plan released: Making Homes Affordable

making-sausageLast month Barack Obama came to Mesa to outline his a plan to help the housing market. Today, the details of his “Making Homes Affordable” plan was released. Looking at all the reports online the only thing that is really clear is no one agrees what the bill will allow you to do and what the outcome will be. There seems to be as much confusion now as there was when Obama announced there would be a plan last month.

It appears that those who have fallen behind in their mortgage and can prove why that has happened with income and tax returns, the government will be giving incentives to both you and your lender to come to an agreement that gets you current on  your loan and keeps you there. We will try to get details from loan mod experts and let you know the details as the get clarified.

The plan aims to help nearly 4 million Fannie Mae and Freddie Mac customers who currently owe up to 105% of their home value to refinance the loan. The plan did not though specify how those homes could be refinanced, but instead left Fannie and Freddie to come up with refinancing guidelines. The Treasury Department did not say exactly who would qualify, but estimated it would be around 4 million. While details are yet to be developed the Treasury did say this program would be for those who are current on the mortgage payments. It appears by most reports this program appears to be more like a FHA Streamline Loan where no appraisal is required on the home.

So for now we recommend homeowners contact their mortgage servicer to get more details on how the refinancing or modifications may effect them.

More recreation opportunities in Gilbert soon

Soon Gilbert will have even more recreation opportunities as a two-mile biking and walking path will be completed along the powerlines between Cooper and Lindsay and running between Elliot Rd and Guadalupe Rd. Gilbert residents expect the new paths to bring even more foot traffic to downtown.

The project, which was approved in 2006, is expected to open in the next couple of months. The new stretch of the pathway will include landscaping and fountains and included photographs and agricultural history of Gilbert.  East Valley Tribune recently had a complete write-up on the project.

New conference center for Gilbert may be coming soon

santanfountainGilbert Arizona has exploded in population over the last decade and now has 215,000 people living within its borders. One thing the town does not have though is a large conference center. That could be changing soon if developer get his way.

An investor is looking to build a 121 room hotel an conference center near the San Tan Village shopping center. If permits are approved, which investors are hoping will be done by May, the location of the new conference center will be near Ray Rd and Williams Field across from the mall’s Macy’s department store. The plan is to break ground shortly after the permits are approved.

Is now a good time to buy a house in Arizona?

Homeownership
An Opportunity of a Lifetime?
Five Reasons You Should Consider Buying Now

The housing market tumble has created an enormous opportunity for first-time home buyers, those that have not owned a home in three years or those wishing to move up. Home prices have declined 14% in the last year. Mortgage rates are low.

1. According to the National Association of Realtors the “housing
affordability index” is higher now than at any point since the index was
started in 1970. The affordability index measures the relationship between
home prices, mortgage interest rates and family income. While home prices
may fall further, there is no guarantee that they will, or that mortgage
rates will stay at current low rates.

2. Now, the Federal Government, through the stimulus package, has
sweetened the deal. First-time homebuyers, and those who have not owned a
home in the last three years, may be entitled to a tax credit for purchasing
a home. This credit is up to 10% of the home’s value, not to exceed $8,000.
This is a real tax credit that can be used for tax year 2008 or 2009. For
example, if you purchased your first home for $150,000 in March of 2009, you
would be entitled to the maximum tax credit of $8,000. Let’s say you owed
$1,000 in additional income tax for 2008. Now, because of this tax credit
($8,000)… instead of paying $1,000 to the IRS, they would send you a
refund for $7,000. To qualify, your adjusted gross income must be below
$75,000 for individuals or $150,000 for couples.

3. There is a large inventory to choose from. Currently, there is about
a 12-month supply of homes on the market. This gives you, the buyer, extra
bargaining power. But, as the inventory of homes decreases, so does your
bargaining power.

4. Builders are offering extraordinary deals. Home builders may be even
more aggressive with their negotiations than foreclosed property or
individual homeowners. Another advantage of purchasing from a builder is
you get a warranty on the home and its appliances. Why would builders be
more aggressive? They want to save their credit, their brand name, and
reputation.

5. Mortgage rates are low. These rates affect your monthly payments.
The lower the interest charged on your mortgage, the lower your payments.
Right now the Federal Government is taking extraordinary steps to keep
mortgage rates low. The Federal Reserve is buying up to $500 billion in
loans, and the Treasury Department has just announced a $200 billion
purchase of Fannie Mae and Freddie Mac preferred shares. These low rates
will not be with us for long.

Before deciding on a home purchase, meet with your financial advisor and go
over your finances. He or she will be able to tell you how much house you
can afford. Making sure that you do not get over your head is more
important now than ever. Also, it is a good idea to get pre-approved for
your mortgage before you go shopping. With a pre-approved mortgage, you
will be in “the catbird seat” when it comes to negotiations.

What questions potential homebuyers should know:

  • What percent of income should my mortgage payment be?
  • Can I afford to take the jump into homeownership?

This blog was a guest column from Dennis R. Ederer, CPA who works for Money COncepts Financial Planning Center in Tempe AZ. You can reach Dennis at 480-968-4939

Another hidden gem in stimulus package for homeowners, $1500 tax credit for green improvements

going-green-at-home-small1It has been brought to my attention that there is another little nugget in the stimulus package signed by President Barack Obama earlier this month. If you own a home and are interested in making some “green improvements” you could find yourself getting another $1500 tax credit for going green.

If you make an improvement on your home in 2009 or 2010, you may qualify for the tax credit. Some projects that will qualify for the $1500 tax credit include installing energy-efficient windows, doors, furnaces and air conditioners. Also you can qualify if you are to add energy-saving insulation to your home too. Home owners will qualify to receive up to 30% of the cost of the improvements back up to $1,500.

This is a great opportunity for someone who has been looking to make green improvements to their home, but maybe holding off because of costs. Now you can spend $5,000 on improvements and receive $1500 of that back in a tax credit. Also to be considered into the cost is the amount of money the improvement could save you.

Can I get out of my contract because of the home inspection results?

cancel-contractIn my last blog post I explored the question Do I need a home inspection? Now that we know a home inspection is a must, what do we do with that information?

The Arizona real estate purchase contract gives the buyer ten days after contract acceptance to to have an inspection performed on the property. After the inspection i completed the buyer needs to notify the seller through a Buyer Inspection Notice and Seller’s Response (BINSR) either they accept the property as is, want to ask for certain repairs to be made or are backing out of the deal all together. After the BINSR is delivered to the seller, the seller has five days to respond in writing if they will make the requested repairs or not. A failure to respond is deemed as a refusal to make the repairs.

If you are going to ask for repairs, make sure you ask for everything you want repaired at this time. You cannot decide you want the garbage disposal fixed now, then come back in another week and say you changed your mind and want the garage door repaired too. If you may want the repairs made, ask for it all at once.

The ten day inspection period gives you other opportunities to cancel the deal. Even if the home inspection came back perfect, that does not mean you do not have option. Maybe you did a little research on the Internet and found out there was a sex-offender a couple houses down and that was a concern to you. Maybe you found out from the neighbors there was a barking dog right next to you and he barks from 7am-5pm every day. You even could decided after looking into the school district a little more that was not where you wanted to send your kids.

The inspection period protects the buyer by providing them a chance to do their due diligence on everything that could concern them. It is there for you, so use it.