A recent survey and a rate increase could mean more competition for homes

Recent indication is that first time home buyers are getting tired of sitting on the sidelines. According to a recent online poll taken by the National Apartment Association, 17 percent of renters plan to make the jump to home ownership in the next year; 41 percent of the 2,041 respondents planned to be home owners within two years. Only 31 percent planned to still be paying rent five years from now.
Another factor that could very soon contribute to an increase in home buying could be rising mortgage costs. Fixed-rate mortgage rates rose to 6.32 percent, the highest it has been since October. After months of aggressively dropping interest rates, many lenders are worried that the Fed will be forced to raise rates back up. As interest rates rise, so do mortgage rates. According to a press release on freddiemac.com, Frank Nothaft, Freddie Mac vice president and chief economist said that, "Mortgage rates jumped this week after a number of Federal Reserve officials, most notably Chairman [Ben] Bernanke and Vice Chair [Donald] Kohn, expressed concern over a threat of inflation." We may very well be seeing the beginning of the end of the super-low mortgage and potential buyers may realize that with rising rates, now may be the time to jump in. Nothaft added, "Moreover, pending home sales for April unexpectedly rose by 6.3% and mortgage applications for home purchases ... were also up last week."

1031 EXCHANGE RULES YOU MUST KNOW

1. Exchanges can be used only for investment properties or properties owned for use in a business. They can't be used for residences or for second homes unless the property is used only for rent to third parties.
2. Exchanges must be made between "like-kind" properties. The like-kind properties must both be used for investment purposes, but they do not have to have the same use. The term "like-kind" means that all properties involved must be investment properties. So your rental condo can be exchanged for a strip shopping center, or a rental house can be exchanged for a parcel of vacant land.
3. To meet IRS guidelines, you must identify in writing the replacement property within 45 days of the relinquished property sale date.
Under the "3 property rule," you may identify up to three properties of any value and then buy one or more from that list. Alternatively, under the "200% rule," you may identify as many properties as you wish, provided their total value does not exceed 200% of the value of the relinquished property.

March was Amazing

I am delighted that March was almost like a few years ago for me. I had five transactions and sold over $2,200,00.00 worth of houses. The dip in interest rates helped some. First time home buyers are a big part of most transactions lately. Included in those sales were two of my Beach houses. Tybee Island is the tightest market locally. I got to experience first hand that the key to selling in this market is to price the houses right.
April is lining up to be another typical spring. I have found it necessary to pass on some listings as the Sellers do not either understand the importance of pricing their house properly or are not able to. The cost to carry these listings is greater than ever and without much chance to move them I prefer to pass on taking the listings. We are fortunate here in Savannah. We have not seen a great adjustment in pricing yet. I am thrilled that I am able to ride the storm.