Real Estate Information

In uncovering the “Best Places to Live,” CNNMoney recently also found which small towns -- having populations less than 50,000 -- boast the highest incomes. Here are the top 10 cities with the highest median family incomes, according to the survey. 

1. Great Falls, Va.

Population: 8,757

Median family income: $367,660

Median home price: $1,090,000 

2. Hillsborough, Calif.

Population: 10,540

Median family income: $319,240

Median home price: $2,277,500 

3. Scarsdale, N.Y.

Population: 17,745

Median family income: $250,124

Median home price: $1,200,000 

4. Weston, Mass.

Population: 11,787

Median family income: $248,871

Median home price: $1,004,000 

5. Los Altos Hills, Calif.

Population: 8,647

Median family income: $243,406

Median home price: $2,273,250 

6. Glencoe, Ill.

Population: 8,881

Median family income: $237,874

Median home price: $807,500 

7. Winnetka, Ill.

Population: 12,234

Median family income: $236,222

Median home price: $990,000 

8. New Canaan, Conn.

Population: 19,682

Median family income: $231,957

Median home price: $1,210,000 

9. Darien, Conn.

Population: 20,049

Median family income: $227,195

Median home price: $1,253,800 

10. Chappaqua, N.Y.

Population: 9,459

Median family income: $219,258

Median home price: $825,000

See the full list of wealthiest cities at CNNMoney. 

Source: “Top-Earning Towns,” CNNMoney (Aug. 8, 2011

Freddie Mac’s HomeSteps unit is offering cash to buyers willing to purchase one of its foreclosed condos that has been lingering on the market. HomeSteps is hoping to unload some of its high inventory of foreclosed condos through the incentive program, known as HomeSteps Condo Cash.

Through the “Condo Cash” program, condo buyers of HomeSteps properties can get up to $1,500 to help pay for standard home owner association dues.

The offer is only valid to owner-occupant buyers and on HomeStep condos that have been on the market for at least 120 days. To participate, buyers must submit offers between Aug. 15 and Nov. 15, and close escrow by Dec. 30. 

Some of the homes also come with a two-year Home Protect home warranty to cover electrical, plumbing, air conditioning, heating, and other major appliances and systems. Home Protect also is offering up to 30 percent discounts on the purchase of new appliances (see www.HomeSteps.com/smartbuy for more information).

Source: “HomeSteps Offers Condo Buyers Up to $1,500 for Future Association Dues for Limited Time,” Freddie Mac (Aug. 15, 2011)

After Standard & Poor’s recent first-ever downgrades of the U.S.’ credit rating, as well as Freddie Mac and Fannie Mae’s and other banks, everyone was watching mortgage rates closely this week to see if the downgrades would have an immediate impact and send rates higher. But all of the economic concerns actually had the opposite effect, pushing mortgage rates to new lows, according to Freddie Mac’s weekly mortgage market survey. 

The 30-year fixed-rate mortgage, a popular choice among home buyers, reached a new low for the year while the 15-year fixed-rate mortgage, 5-year adjustable-rate mortgage, and 1-year ARM all averaged new all-time record lows. Also possibly serving as a boost to home buyers and those looking to refinance, the Federal Reserve announced this week that the weak economy has prompted them to vow to keep the federal funds rate exceptionally low at least through mid-2013.

"Lower mortgage rates will help to maintain the high degree of home buyer affordability in the market,” says Frank Nothaft, chief economist at Freddie Mac. Home affordability has been at its highest level in the past three quarters since 1970, according to the National Association of REALTORS®’ affordability index. 

Here’s a closer look at how rates fared for the week: 

• 30-year fixed-rate mortgage: averaged 4.32 percent, down from last week’s 4.39 percent, and marking this week a new low for this year. A year ago at this time, the 30-year rate averaged 4.44 percent. 
• 15-year fixed-rate mortgage: averaged 3.50 percent, moving down from last week’s 3.54 percent, and reaching a new all-time low for 15-year rates. Last year at this time, the 15-year mortgage averaged 3.92 percent.  
• 5-year ARM: averaged 3.13 percent this week, inching down from last week’s 3.18 percent. Last year at this time, the 5-year ARM averaged 3.56 percent. 
• 1-year ARM: averaged 2.89 percent, dropping from last week’s 3.02 percent. A year ago at this time, the 1-year ARM averaged 3.53 percent. 

Source: REALTOR Magazine Daily News

Check reports to ensure accuracy. First, your customers want to make sure they aren’t getting penalized by a low score that is a mistake. They can get a free copy of their three major credit reports at annualcreditreport.com, a government-authorized Web site. Credit bureaus are required to investigate any mistakes you bring to their attention. “Typically, they ask the creditor that reported the past-due information to check its records. If the creditor can’t verify the info or doesn’t respond, the item should be deleted,” the article notes.

Always pay bills on time. Paying bills on time is critical for a good credit score. Your payment history comprises more than one-third of the typical credit-score determination, says Liz Weston, author of “Your Credit Score.” 

Keep accounts open. Don’t close old credit card accounts, even ones you’re not using. It’ll reduce the amount of available credit and can actually lower your credit score. 

Get more tips and a handout to download to give to your customers: What You Can Do to Improve Your Credit Score.

In an unusual step, the Federal Reserve vowed Tuesday to keep interest rates low for at least the next two years. 

The Fed said it’ll keep its key benchmark interest rate near zero through mid-2013. The Fed’s commitment was welcome news to many in the real estate industry who see it as a positive move for the housing industry, allowing buyers more time to take advantage of ultra low mortgage rates. 

The Fed said in a statement following its regular policy-setting meeting Tuesday that the overall economy has grown "considerably slower" than it expected and that consumer spending "has flattened out." Some economists in recent days have expressed concerns that the U.S. is heading for a double-dip recession.

Fed officials "are very nervous about the economy," says Mark Zandi, chief economist at Moody's Analytics. "This is unprecedented for the Fed to indicate they are ready to keep rates low for two more years."

Still, the Fed continues to forecast a moderate pick-up in growth for the economy in the second half of the year. 

Source: “Fed says it Will Hold Rates Fast Until mid-2013,” MSNBC.com (Aug. 9, 2011)

Standard & Poor’s downgraded the credit rating of lenders backed by the federal government on the heels of the first-ever lowering of the U.S.’s credit rating. 

Fannie Mae, Freddie Mac, and other government-backed lenders were lowered one step from AAA to AA+, S&P reported in a statement issued Monday. Some analysts say the downgrade may force home buyers to pay higher mortgage rates. 

"The downgrades of Fannie Mae and Freddie Mac reflect their direct reliance on the U.S. government,” S&P said in a statement. “Fannie Mae and Freddie Mac were placed into conservatorship in September 2008 and their ability to fund operations relies heavily on the U.S. government.”

The GSEs own or guarantee more than half of U.S. mortgage debt.

Freddie Mac said that the lower debt rating will cause “major disruptions” in its home-lending by possibly reducing the supply of mortgages it can purchase. It said in a Securities and Exchange Commission filing that the lower rating could hamper home prices and even lead to more home-loan defaults on mortgages it guarantees. 

Meanwhile, the Federal Housing Finance Agency on Monday assured investors that securities issued by GSEs are sound. "The government commitment to ensure Fannie Mae and Freddie Mac have sufficient capital to meet their obligations, as provided for in the Treasury's senior preferred stock purchase agreement with each enterprise, remains unaffected by the Standard & Poor's action," said Edward DeMarco, FHFA acting director.

Some analysts and lenders have said they don’t see the fallout from the S&P downgrade on the U.S. and other banks as having such a widespread affect. "It's likely that once the storm passes, you'll get an increase in mortgage rates because of this, but it won't be significant,” says Anika Khan, a housing economist at Wells Fargo.

S&P also announced on Monday that it had lowered its credit ratings for 10 of 12 federal home loan banks and federal farm credit banks from AAA to AA+.

Source: “S&P Lowers Fannie, Freddie Citing Reliance on Government,” Bloomberg (Aug. 8, 2011); “S&P Downgrades Fannie and Freddie, Farm Lenders and Bank Debt Backed by U.S. Government,” Associated Press (Aug. 8, 2011); “Freddie Mac Reports $4.7B Loss, Says S&P Downgrade Will Disrupt Mortgage Market,” Associated Press (Aug. 8, 2011); and “FHFA Assures Investors After Fannie, Freddie Downgrade,” HousingWire (Aug. 8. 2011)

Bank of America, the country’s largest bank, has reportedly reached a settlement with the Department of Housing and Urban Development over failing to provide alternatives to foreclosure on about 57,000 government-insured mortgages.

In reporting on the agreement, which is still in draft form, American Banker says HUD has agreed to release Bank of America from any liability if the bank waives “a minimum of $10 million in unpaid mortgage payments and vet each of the 57,000 delinquent borrowers for a possible loan modification, short sale, or other foreclosure alternative.”

Bank of America spokesman Dan Frahm told American Banker that this will help “ensure these customers have every opportunity to stay in their homes.” The 57,000 borrowers affected are one to two years delinquent on their mortgages.

The settlement serves as HUD’s first in settling claims against a servicer for failing to offer loss mitigation to borrowers. 

Source: “BofA Signs HUD Pact Over Mortgage Abuse,” American Banker (Aug. 5, 2011)