Image by DougFrancis via Flickr

Well, not really in Northern Virginia!

In the grand scheme of things, we should see home buyers having the best of times with this real estate market. The available home buyer tax credits, home prices are the lowest in years, mortgage interest rates are still around 5%, spring is in the air… okay, that’s a stretch.

As I went over NVAR’s end of year statistics there was one glaring fact that directly impacts a buyer’s market.

Lack of Inventory

All the information available on web sites isn’t going to give you the strategies necessary to successfully buy a home in this market. Yep, it’s another reason to have a buyer agent working to make you the strongest, most competitive home buyer possible.

Let’s talk…

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If you are or have a friend who is thinking about buying a home and taking advantage of the $8,000 first-time home buyer tax credit, then there are some facts you need to know, and we need to talk today. Especially since everyone and their little brother/sister knows about the current affordability index… more on that below. And this isn’t just information for my real estate clients in Northern Virginia, but for any home buyer out there across the USA!

Home Buyer Tax Credit info you should know:

• There is a deadline: Have a contract by May 1, 2010 and settle before July 1, 2010
• The income caps for the full $8,000:

Individual Filers with a modified AGI of $125,000
Joint Filers with a modified AGI up to $225,000

• First-timers are defined as someone who has not owned a home in the last 3 years
• Primary residence only (main home)
• A fast transaction from contract to closing is 30 days
• Most lenders suggest giving FHA loans a 45 day window
• The Fairfax County Courthouse is closed for Memorial Day.
• If rates change, your lender may have to give you a new estimate with a new review period.

So your strategy needs to start right now because I am seeing multiple offers on many places as buyers are rushing to beat the Home Buyer Tax Credit deadline. Work the time frame backwards for a minute because the big “crush” on mortgage companies will probably come at the end of June (code for delays). I am going to feel a bit uncomfortable if settlement is after the 19th and will advise you of the risk. With many loans today being of the FHA variety, lets move back another 45 days meaning you need a ratified contract by early April!

So what is this affordability index?

Prices are down about 15% since last year, and 30-year fixed rates that were at 6.5% last year are now lower than you may think. For example Curt Gilbert at Bank of America sent me a rate sheet on 10/30/2009 showing an FHA rate at 5.00% with 0.50 points. Conventional financing to $729,000 has rates close to 5.00% too.

For IRS details, (I will update this)

Time is passing quickly and we should be discussing a game plan right now or you may just miss the Home Buyer Tax Credit for 2010. My contact information is on the Contact Me page.

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So after you have surfed through umpteen home-search web sites late one night, contacting a reputable lender and completing a basic loan application will get the ball rolling! I know some.

Have you been paying you bills on time?

It’s a hard-and-fast rule…

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• Your FICO Score will take a hit from Damage Points (dougfrancis.com)

When I meet with buyer clients, I like to discuss how our home search is going to involve a multi-pronged effort in order to be successful. The client will use the resources of the Internet with sites like Homesdatabase.com,  Realtor.com, Trulia or Zillow, and a few other super secret strategies. Yes, I will have the MRIS/MLS along with a network of successful agents that I have cultivated over the years and a few clever old school ideas.

But a few weeks ago when some clients were being extra specific, I drilled down through the Fairfax County tax records to look for old-timers who may be getting ready to move. You know, the old “come on lady, move out now while you can still walk” strong-arm strategy, similar to the training tape we just watched last week featuring Alec Baldwin.

But seriously, I found some folks who had been in their home 20+ years and sent them a compelling letter with followed up phone calls. As fate would have it, one guy who was just starting the pre-listing process and received a letter called his agent asking if my letter “was for real”.

“Who is it from?” she asked.

“Some guy named Doug Francis with Remax real estate” he responded.

“Well, I have known Doug for 17 years, so I feel it’s legit” she said.

So we saw the house, made an offer that was accepted, and now just have to wait for the appraisal to get finished. A successful home search, even in Vienna, Virginia, needs more than one strategy to get the job done.

Old school!

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I understand that finding the house is the easy part… it’s putting together the contract offer where my client’s really benefit. Yeah, more in the blog…

So why not compare… this site to this site and give me some feedback!

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