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City of Bozeman and YMCA to Partner and Build Aquatics Center

by Sean McSpadden

In early June, the Bozeman City commission approved plans to partner with the YMCA to build a new aquatics center in Bozeman. The YMCA plans to build the land at Vaquero Parkway, a piece of land they already own. City commissioners approved the partnership, voting 3-2 in favor. The city also had the choice of either building the aquatics center at Rose Park with the YMCA, or without them, but instead chose to partner with them and build it near Regional Park. Regional park also provides locals with amazing opportunities such as the Dinosaur Park, two ponds, a beach and other facilities. The new aquatic center will only add to the fun and utility of this Bozeman park.

New Pedestrian Trail Added in Northeast Bozeman

by Sean McSpadden

The city of Bozeman, in conjunction with Gallatin County, began construction on a new trail from North Rouse to Seventh Avenue. The city expects the project to cost $264,596 dollars and should be finished in the next few weeks. Ideally, the trail will greatly increase the safety of bikers and pedestrians in Northern Bozeman. As most trails run north to south, the east-west running trail should markedly improve transportation ease in the city. In addition to the trail on Rouse, the city has recently added trails along Norris Rd. as well as from Cougar Dr. and Cottonwood Rd. south of town. Reliable, safe trails can be a lifesaver for young families while keeping bikers off of busy main roads. Bozemanites can now look forward to relaxing evening walks or morning runs with more comfort and confidence.

Schattauer, Erin. "New Oak Street Trail Creates County-City Connection." Bozeman Daily Chronicle (2014): n. pag. Web. 11 Jul. 2014.

Top Students Choose MSU

by Sean McSpadden

Top Montana high school students, who received a Montana University System Honor Scholarship, continue to choose Montana State University and Bozeman over any other college or university in the state.The MUS Honor Scholarship rewards students for exceptional academic excellence at the high school level, requiring applicants to maintain a 3.4 grade point average after 7 semesters of high school. MUS Honor Scholars can receive free tuition for up to four years based on this GPA coupled with their SAT and ACT scores. At MSU, this converts to around 5,300 dollars annually. Yet, even with high competition levels between Montana schools, sixty-eight percent of these students have applied to MSU, reflecting a higher percentage than all other Montana universities combined. MSU beat its own numbers this year, up five percent from the previous year. High quality programs continue to attract young ambitious thinkers, while its university culture and a positive relationship with the city of Bozeman continue to spur these numbers forward. Intelligent students in higher numbers can only be a positive sign for Bozeman’s future.

 

Reinhardt, Tanya. "MSU Remains School of Choice for High Achieving Students." Bozeman Daily Chronicle (2014): n. pag. Web. 7 July 2014.

 

Allowing MLS to Take the Lead

by Tim Hart

  

“The power balance in the real estate world is shifting faster than ever. Travel titans, search engines, investment oracles and government entities all want to change the way we do business. Most just want to control a larger piece of the pie.” (Source)

 

In the everyday functioning of a real estate office, attracting and retaining agents is a top priority. Real estate, although a volatilemarket, is a rather stable numbers game when it comes to the number of agents entering versus retiring. With that being said, the ability of a broker or agent to increase sales production and income often comes at the expense of competing agents and brokers.

The common element in this competitive personal marketplace is the multiple listing service [MLS]. “The multiple listing service could be called the referee for our regional activities.” (Source) MLS standardizes practices and creates/enforces a plethora of rules. Some agents appreciate the consistency. Some agents loathe the rules impeding into their business. That very tension is where the greatest value of MLS is hidden. An authoritative entity used for the creation of industry wide standards is crippled if it is not also give the ability to enforce. Because of this, MLS is a uniquely powered organization. Realtor organizations, a variety of brokerages, part-time and full time agents, and the MLS staff all work together to generate consistency within real estate listings—the driving force for all real estate movement.

As the real estate industry is becoming increasingly more technologically driven, the tech driven entrepreneurs within the agent community seem to be leaning more toward unified solutions grounded in the network already in place—MLS.

 

The future of MLS may very well be a more regulated national oversight service. Many pressures on the real estate community are encouraging MLS to get more teeth. The alternative would be that brokers could forge different agreements with the same portals like multiple buyers competing for a home. Everyone could begin undercutting everyone else. There would be no uniformity of goal. So keep your eye on the real estate Multiple Listing Service… I am interested to see where this goes. 

Investing Options: Tapping into Your Home’s Equity

by Tim Hart

When the housing market is in a full swing recovery like it is today with interest rates still historically low and inventory changing daily, it is a good time to see how you, the ‘happy in your current home and not looking to move,’ can tap into the market through investing.

Usual Methods of Real Estate Investment: These include: financing a new purchase with a mortgage or selling some stocks and bonds, taking money out of your IRA or from your 401(k). These are hit and miss and sometimes turn out to be not-so-smart moves but they seem to be the methods by which most investors fund their second (or third, or fourth…) purchases.

An Unusual Proposal: Some investors have begun to start using the equity they have built up in their own home as the launch point for an investment property! Home equity, the difference between what a person owes on their mortgage versus their home’s market value, rises with the strengthening real estate market. The increasing value of your home’s equity can be monetized through a home equity loan (a call-out refinance) allows home owners to use their current home’s value to pay for a second home. This, like the methods above, does has pros and cons to it.

  • Pros: Lenders are more willing to lend on more favorable terms because the home owner has more skin in the game. The costs on borrowing will be lower as well since this form of loan does not involve paying for title searches or the transactional cost of a new mortgage.
  • Cons: Your monthly payments will increase and if you cannot pay, you may lose your primary home to foreclosure. In addition, this is an eggs all in one basket approach—you will be investing in one type of asset.

http://money.cnn.com/2013/08/16/pf/expert/home-equity/index.html

New Chapter In Housing Market Recovery

by Tim Hart
 

The nation experienced a 5.24% decline in housing inventory this July. At the same time, the national median listing price increased by 5.27%.

“The recovery is entering a new phase where inventory shortfalls are no longer the driving force behind changes inhousing prices in many markets. Larger inventories, especially in the hotter markets that experienced rapid price increases in the spring, are expanding buyers’ choices and helping to moderate price increases,” said Steve Berkowitz, CEO of Move, Inc. “This month’s report also underscores the uneven nature of the housing recovery and its dependence on the strength of the local economy.”  

This new trend boasts the following highlights:

  • No More Year-Over-Year Inventory Declines

  • Local Markets Inventory Declines Decrease Leading to Slower Price Growth

  • Mortgage Rates Rise/Plateau

 

Source: http://www.realtor.com/news/housing-inventory-declines-are-easing/

Eminent Domain Plan and Real Estate

by Tim Hart

Freddie Mac is making a bold move by threatening legal action against the city of Richmond, CA because they are planning to use eminent domain to seize underwater mortgages.

  • Richmond’s Stance: In offering to buy troubled loans at below market value from mortgage companies, they are then able to write down the loan balances for the new home owners and refinance the loans into government-backed mortgages. IF the mortgage companies refuse to allow them to buy the loans, they city will play the eminent domain card and seize them. This whole plan is theorized to help residents curb the loan debt and avoid foreclosure. Circumventing the federal government in this process is the key point. Richmond officials hope this new method will speed up the currently stagnantly moving foreclosure aid assistance. “We’re not willing to back down on this,” says Richmond Mayor Gayle McLaughlin. “They can put forward as much pressure as they would like, but I’m very committed to this program, and I’m very committed to the well-being of our neighborhoods.”

Richmond is not the only city considering this option for their residents. About two dozen local and state governments — including Newark, N.J., Seattle, and several other cities in California — have been considering similar uses of eminent domain. 

  • Freddie Mac’s Stance: Voicing cautionary rhetoric, Freddie Mac feels the loan sales will be made only under pressure instead of being clean, tidy, and voluntary as assumed by Richmond. Freddie Mac and its backer, the Federal Housing Finance Agency, are considering taking legal action against such a plan.

This new method of circumvention may threaten real estate recovery. "We are concerned that the proposed use of eminent domain would slow the return of private capital to the housing finance system, and threaten our fragile housing recovery," writes California House Republicans John Campbell, Gary G. Miller and Ed Royce in a letter to Housing and Urban Development Secretary Shaun Donovan. "We do not believe this is appropriate public policy, even if this use of eminent domain were to survive the inevitable legal challenges that would follow any decision to seize mortgages.”  

Freddie Mac Considers Legal Action to Block Eminent Domain Plan

http://realtormag.realtor.org/daily-news/2013/06/13/congress-hud-eminent-domain-proposal-threatens-recovery

http://realtormag.realtor.org/daily-news/2012/06/13/can-eminent-domain-be-used-take-over-mortgages

Back to School and the Real Estate Market

by Tim Hart

After the thralls of summer begin to fade into the dry grasslands that signal in fall, parents start thinking about the school season. In fact, a recent realtor.com survey found that school districts impact 60% of home buyers. This carries so much clout with some buyers that are willing to spend more in order to buy within a the district they want their children to belong in. This oftentimes takes a higher priority than parks, trails, and other amenities.

A majority of the home buyers surveyed said that school-district boundaries will have an impact on their buying decision:

  • 23.59 percent would pay 1-5 percent above budget
  • 20.70 percent would pay 6-10 percent above budget
  • 8.98 percent would pay 11-20 percent above budget
  • 40.33 percent would not go above budget

For home buyers who said that school-district boundaries will have an impact on their decision, the majority rated the boundaries as an “important” consideration:

  • 90.53 percent said school-district boundaries are  “important” or “somewhat important”
  • 2.04 percent were “neutral” about the importance of school-district boundaries
  • 7.43 percent said school-district boundaries are “unimportant” or “very unimportant”

 

Data Source: http://www.realtor.com/news/back-to-school-home-search-tips/

Selling Your Home in a Rising Rate Market

by Tim Hart

This past year has brought with it significant improvements to the wounded market we all lived through last year. With this healing process, the world of a seller became an ease as the constraints of limited inventory, low prices, and low mortgage rates all converged. Slowly listing prices began to rise and now, mortgage rates are following suit. “There’s no one in the business right now who doesn’t think the market hasn’t taken a step back. The evidence is all around us,” said Glenn Kelman, chief executive of real-estate brokerage Redfin. (SOURCE) A good rule to follow is that 1% increase in mortgage rates will equate to a 10% reduction in affordability or purchasing power a buyer has. The most recent leaps in rates have made homes just about 10% more expensive to buyers who need to finance their purchase.

So how do you sell your home in this market condition?

  • First, you must remember, even at 5%, rates are still low and homes are still affordable when you look at historical standards. With that being said, this is a stock to the buyer’s side of the market. Buyers oftentimes shop for a home based upon their monthly mortgage payment which does mean they will be looking at a slightly lower price range for their purchase—but at this point, the market feels they buyers are still actively looking so be sure if you are on the fence, you get your house on the market!
  • It is all about balance. The market that will take the biggest hit is most likely to be the high end of the market. Oh the other side of the spectrum, the market that will perhaps most benefit from this new market environment would be that of the real estate investors. Investors who have been taking advantage of the low rates and buying properties to rent will see the influx of renters come back to the market as they see their buying potential dwindle. Because of both these factors, home inventory will finally catch up to the demand and the market will stabilize so that both buyer and seller alike are entering a more stabilized marketplace.
  • The hit to home prices is still out there in the future and has not happened yet. It is more of a shockwave impact where the news hit, sellers and buyers have time adjust and react and then the market adjustments happen. Here in Montana we get an even bigger buffer zone because we are always a few months behind the national trends. If you are looking to buy or sell right now, the market is still in a very advantageous place for you. In fact, pending home sales are reaching new highs.

“The number of pending home sales seen through the end of May increased 6.7 percent from April and 12.1 percent on an annual basis, bringing the current level seen nationwide to its highest point since December 2006, just prior to the start of the housing meltdown beginning in earnest, according to the latest Pending Home Sales Index from the National Association of Realtors.” (SOURCE)

Healthy Real Estate: Bursting Bubble Fears on the Rise

by Tim Hart

“Prices are increasing quickly, though that may not always be the most healthy development for the economy. Also, banks may soon loosen overly strict requirements, but a choke point remains in new-home construction.(source)

“The median home price jumped 8% from the previous month to $208,000, according to NAR. While month-to-month price swings are not unusual, the year-over-year rise is now 15%, and prices are at levels last seen in the summer of 2008, just before the bursting of the housing bubble.” (source)

The housing recovery is in full swing. The surge in themarket caught many by surprise with how fast and how swiftly demand for new homes and the selling of homeshappened. There are still too many buyers seeking to buy in a market with too few homes for sale. For most, all this news is vibrant and wonderful.

There is always caution that must be mixed into the equation when it comes to the real estate market.

  • Although fast-rising home values are great for home owners, price increases that go beyond the growth of income create a weak point within the economy that will have to balance itself out eventually.
  • The potential loosening of underwriting restrictions will normalize the lending environment but this too will contribute to a faster price growth. Making it easier for buyers to buy will only put stress on the already limited inventory on the market.
  • New-home construction breached the 1 million mark for the first time in five years in March. Currently, 1.5 million new housing units are needed annually to keep pace with the price gains to keep the market stable and healthy.

All of these currently optimistic headlines the real estate world is seeing are all red flags in and of themselves as well. The market is amorphous unit and will adjust to re-balance itself in time. Too fast of a recover can potentially mean an equally fast decline when the market constricts. One eye on the present and one eye on the future. 

Displaying blog entries 1-10 of 106

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