Fannie Mae make home loans easier to quality

 

Fannie Mae has announced some major game changers that began in July 2015 for new home loans. There were a total of 13 policy changes implemented this month, but 3 of them will completely change the face of lending for many home buyers.

Homeowners in a position to make their current primary residence an investment or rental property and buy a new home can now do so without being required to have a six month reserve for both properties. Before now any homeowner that wanted to keep their current home as a rental rather than selling to purchase their new home had to provide proof of at least 6 month’s reserve to support BOTH homes, the new home and the rental. This is no longer a requirement.
Under the new Fannie Mae guidelines lenders are no longer required to provide the vast paper trail of the past when stocks, bonds, and mutual funds are being used as a down payment as long as the investment account holds the down-payment amount plus 20%. Additionally, 100% of the account balance can now be used as an asset on the loan application in comparison the the old 70% only being valid.
Applicants using bonus and commission income may not have to take a hit on their income qualifications anymore for un-reimbursed business expenses. If the bonus and commission pay being considered accounts for 25% or less of the applicant’s total income, you no longer have to reduce your income by the un-reimbursed expenses accrued.

Fannie Mae has made qualifying for a home loan easier, with less paperwork and documentation required in many aspects this month. If you have been thinking about upgrading your home, or downsizing and keeping your current home for rental income you may be in a better position that you thought possible with these new policy changes. Always contact a mortgage lender with your specific situation as each is truly a case-by-case basis regarding qualification.

Housing Market

Are there more or less homes available to purchase this year vs 2014?

Well ask anyone trying to buy a home today, and the vast majority will launch into a story about a bidding war. Demand for housing has returned, but housing supply has not, and the numbers are only getting worse.

The supply of homes for sale nationally in June fell 6.5 percent from a year ago, according to a new report from Zillow, a real estate listing and analytics company.

U.S. home resales rose in June to their highest level in nearly 8-1/2 years, a sign of pent-up demand that should buoy the housing market recovery and overall economy.

The reasons for tight supply are manifold: Homebuilders are putting up single family homes at a far slower pace than historical norms. They cite a shortage of labor for at least some of that weakness, but they also are not seeing strong demand, due to their higher prices.

“Finding a house is the last hurdle for many buyers who have saved a down payment and gotten pre-approved for a mortgage, but low inventory levels like those we’re seeing across the country can bring the home buying process to a screeching halt,” said Stan Humphries, chief economist at Zillow. “In many markets, there just isn’t a lot to choose from in terms of homes on the market.”

The bigger the city, the bigger the problem. Inventory fell in 19 of the nation’s largest metropolitan areas. Supplies are also falling the most in the lower price ranges, making it even more difficult for already cash-strapped first-time buyers to get into home ownership.

Supply is also directly connected to price. Supplies are lowest in markets where prices continue to rise, but supply is actually starting to ease in markets where home prices have flattened. Take Washington, D.C., for example. Home prices are flat from a year ago, and inventory is now up nearly 19 percent, according to Zillow. In Dallas, however, where prices are still rising, up 12.5 percent from a year ago, inventory is down nearly 20 percent.

“Sellers tend to want to hang in and get the last juice out of the orange,” said Humphries. “If you think you might see 10 percent appreciation over the next year, is it rational to move where you might squeeze more out of the market? No.”

2015 Parade of Homes

Stop by and check out our 2015 Parade of Homes for 2015

 

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The New Home In 2015

The current housing downturn has affected not only the number of new homes that are built each year, but also the characteristics, features, and size of the ones that do get built. Many in the industry are wondering about how the new home will evolve over the next few years and whether those changes will stick once the economy bounces back to a more solid footing. In 2010, NAHB conducted a survey that sheds light on the likely characteristics of the average, new single-family detached home in 2015. This article summarizes the findings of that survey, which were released in December 2010 in a report titled The New Home in 2015 [1]  .

Some of the most relevant findings include:

  • The average, new single-family home will be smaller and have more green features
  • The living room will either vanish or merge with other spaces in the home
  • The “Great Room” is the likeliest room to be included in the average new home
  • Low-e windows and engineered wood products are the likeliest green features
  • A double sink, recessed lighting, and table space for eating are very likely in kitchens

Survey Methodology

NAHB’s The New Home in 2015 survey was sent electronically to 3,019 builders, designers, architects, manufacturers, and marketing specialists. The sample was stratified by region of the country (to be proportional to housing starts in each of the four Census regions) and, among builders, by their number of units started.

A total of 238 responses were received, of which 30 percent came from single-family builders, 19 percent from architects, 26 percent from designers, 7 percent from manufacturers, and 18 percent from “other” building industry professionals.

In many of the questions, respondents were asked to rate the likelihood that certain characteristics would be included in the average, new single-family detached home in 2015 using a scale of 1 to 5, where 1=not at all likely and 5=very likely. Based on participants’ responses, average ratings were calculated and characteristics were designated as either “very likely” (average rating above 4.0), “somewhat likely” (average rating between 3.0 and 3.9), or “unlikely” (average rating of 2.9 or lower) to be part of the average new single-family detached home of 2015.

Broad Trends

In order to measure which of five broad trends would be more prevalent in the next five years, building professionals were asked to rank the following trends from least to most probable to occur by 2015: the average single-family home will get smaller, it will have more green features, it will have more technology features, it will have more universal features, and it will have more outdoor living features.

As Figure 1 shows, the majority of respondents agree that the single-family home will get smaller and that it will have more green features over the next five years. The former was rated as the first or second most probable trend by 74 percent of survey respondents, while the latter received similar ratings from 68 percent of them. Meanwhile, only 29 percent of respondents rated the trend for more technology features in the home as the first or second most probable trend, 20 percent rated the trend for more universal features likewise, and only 10 percent indicated more outdoor living features would be the dominant trend over the next five years. Regarding universal features, many respondents indicated that the average home of 2015 would be “adaptable,” and not necessarily “accessible,” implying that many accessibility features would be planned for, but not actually included in the average home.

Average Home Size

Respondents expect the average, new single-family detached home in 2015 to be about 2,152 square feet, 10 percent smaller than the average size of single-family homes started in the first three quarters of 2010  [2] . Overall, 63 percent of respondents expect the average size of new homes in 2015 to be somewhere between 2,000 square feet and 2,399 square feet, 22 percent expect it to be between 2,400 square feet and 2,999 square feet, while 13 percent expect it to only be 1,600 square feet to 1,999 square feet (Figure 2).

Data from the Census Bureau [3]  indicates that the average size of single-family homes completed peaked in 2007, at 2,521 square feet, was virtually unchanged in 2008, and then declined in 2009 to 2,438 square feet. Preliminary data for 2010 shows a further decline, down to 2,377 square feet. Although part of the recent drop in average home size may indeed be temporary due to hard economic times, a number of factors lead building professionals to expect home size declines in the long-run: consumers are focused on lowering the cost of heating and cooling their homes; they no longer have sizeable equity in their current homes to finance a much larger one; diminished expectations for house price appreciation has reduced demand for extra square footage in order to achieve appreciation on a larger base; demographics, 29 percent of the US population will be 55+ in the year 2020, demanding smaller homes; and strict mortgage underwriting for the foreseeable future. Combined, these factors will weigh on the consumer to purchase homes based on need more than want.

How Living Room Will Change

An overwhelming majority of respondents do not expect the living room to stay in its current form. Instead, more than half (52 percent) expect the living room to merge with other spaces in the home, while 30 percent expect it to vanish to save on square footage. Another 13 percent expect it will become a parlor/retreat/library or music room (Figure 3).

Rooms/Features

The great room (kitchen-family room-living room) is the most likely room to be included in the average, new single-family detached home of 2015. Using the scale from 1 to 5 (where 1=not at all likely and 5=very likely), the great room topped the list of “very likely” rooms/features, with an average rating of 4.6, followed by walk-in closet in master bedroom (4.5), laundry room (4.2), ceiling fan (4.1), master bedroom on 1st floor of 2-story home (4.1), and a 2-car garage (4.0) (Figure 4).

A home office, 9’+ ceilings in the first floor (both with average ratings of 3.9), an indoor fireplace (3.4) and bolder colors on interior walls (3.2) were designated only as “somewhat likely” to be included in the average new single-family home of 2015. Some of the “least likely” features to be present: two master bedroom suites, a sunroom, and a hobbies room (all with average ratings of 2.2), a media room (2.4) and the living room (2.5).

Green Features

Low-e windows are “very likely” to be present in the average new single-family home of 2015 (4.5 average rating), as well as engineered wood beams, joists, or trusses (4.4), water efficient features (dual flush toilets or low flow faucets) and Energy-Star rating for the whole home (both with an average rating of 4.1) (Figure 5).

Some of the green features respondents rated only as “somewhat likely” to be present in the average new single-family detached home of 2015 include insulation higher than required by code (3.8), tankless water heater (3.8), and argon gas windows (3.7). Two green features were considered to be “unlikely” candidates for the average new home in 2015: green certification from LEED program (2.7) and other renewable energy sources i.e. geothermal, wind (2.8).

Kitchen Features

As previously stated, the kitchen, along with the family room and the living room, will increasingly be combined to form the Great Room. But what exactly is the kitchen of the average new home of 2015 likely to have? According to survey respondents, a double sink (4.3 average rating), recessed lighting (4.2), table space for eating (4.1), a breakfast bar (4.0), and pull-out drawers (4.0) are “very likely” features in kitchens five years from now (Figure 6).

A central island (3.8) is “somewhat likely” to be included in kitchens of average new homes in 2015, along with a walk-in pantry (3.6), a recycling center (3.6), desk/computer area (3.4 ), granite countertop (3.4), and to a lesser degree laminate countertops (3.0).

What the average new kitchen of 2015 is “unlikely” to have is a trash compactor, fireplace, wine cooler, and butler’s pantry (all with an average rating of 2.3), hot water dispenser (2.6), and a small appliance storage area (2.8).

More survey results are available in a PowerPoint presentation (PDF format) that can be downloaded from the “additional resources” box at the top of this page. All the findings are available in the report, “The New Home in 2015,” including data on the likelihood of various universal, technology, outdoor, bathroom, and neighborhood features.

Water Feature

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Platinum Builders first ever water feature installed in a customers house out in Migration Path…WOW

Madison Capitals Hockey

 

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USHL hockey is back in Madison and Platinum Builders is a Sponsor for the up coming 2014-2015 season. Come join us @ the PLATINUM ROW !!! It’s a GREAT day for hockey

Best of Houzz 2014

Best of Houzz 2014 – Client Satisfaction

You were rated at the highest level for client satisfaction by the Houzz community.

Walker Proclaims ” New Homes Month”

 

(Madison, WI) – For the second year in a row, Governor Scott Walker issued an official Proclamation announcing the month of April as “New Homes Month” within the state of Wisconsin. A new web domainwww.HomeSweetNewHome.com hosted by the Wisconsin Builders Association (WBA) reviews the benefits of building a new home including a list of the “Top Ten Reasons to Build a New Home.”

Because statistics show that 91% of all new home purchase decisions are made by women, the WBA developed a New Homes Month consumer education campaign with them in mind.

Throughout the month of April, the Wisconsin Builders Association in conjunction with 23 local associations across the state will conduct a consumer education campaign through their Facebook page highlighting five main themes: Healthy Living, Peace of Mind, Social Entertaining, Wise Investment, and Personal Achievement.

“It is encouraging that Governor Walker has placed new home building as a top priority for the state once again,” said Kirsten Lee Villegas, WBA State Executive Officer.  “Besides the positive economic value the home building industry brings to a community, new homes also provide tremendous personal value to a homeowner.”  

The first week’s theme focuses on Healthy Living and the advantages that a newly built home provides to personal health and well-being. Topics such as natural sunlight, indoor air quality, potential “used” homes issues with mold and radon will be discussed with helpful links to find even more information on the topics.

To follow the weekly consumer education updates, simply “LIKE” the WBA Facebook page at http://tinyurl.com/phelptp

Awesome Texas Chili

 
    2 lbs. chuck stew beef, cut into small chunks
2 tbs vegetable oil
1 can (15 oz) pinto beans, drained
12 oz. Tomato paste
1 cup chopped onion
3 garlic cloves, minced
1 green pepper, seeded and cut into two pieces
5-10 slices of pickled jalpeno pepper slices (depends on your heat preference)
1 bottle of beer and enough water to equal 2 1/2 cups
1 1/2 tbs. chili powder
1/2 tsp cumin
1/2 tsp red pepper
1/2 tsp oregano
1/2 tsp salt

In large pot, brown meat in oil, in two batches, draining off fat after each batch.
Return drained meat to pot. Add rest of ingredients and bring to a boil, reduce
heat to low and simmer for 2 hours.

Kilkenny Farms

 

Don Tierney newest subdivision located in Waunakee.  Kilkenny Farms is conveniently close to Highway 19 and downtown Waunakee. The layout of the neighborhood was thoughtfully designed to maximize walkout exposure, country views, trails, and parks…

 

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