Our grand opening party was a huge success! While Keller Williams Realty has been in Wilmington for over four years, we just recently moved to a new office space located at 5911 Oleander Drive. The chamber kicked off the event at 4:30PM with a ribbon cutting, and the rest of the evening was a social whirlwind of friends, family, clients, vendor partners, and Realtors. We estimate several hundred guests came through our doors! From the Champagne fountain to the sushi, there was no shortage of great food and drinks. Currently, Keller Williams in Wilmington has just over 80 agents. Nationally, KW has over 73,000 agents and is the fourth-largest U.S. residential real estate firm. Our company believes in treating associates as partners and shares knowledge, policy control and profits on a system-wide basis. This is truly a phenomenal place to work! Thank you everyone who attended our grand opening party- your support is invaluable!

The Housing and Economic Recovery Act of 2008 was signed into law this week by Bush. This $300 Billion rescue plan is aimed at aid struggling homeowners in avoiding foreclosure, as well as boost consumer confidence in real estate. Below are a few of the major points that may impact you:

1. Tax credits: First-time homebuyers who purchase their primary residence on or after April 9, 2008 and before July 1, 2009 are eligible for up to $7,500 in tax credit, provided they haven’t owned a home in the last three years and fit certain income parameters. The credit is generous, but it is actually an interest free loan, paid back over 15 years at $500 per year when taxes are filed.

Special note: Some types of seller-paid down payment assistance programs are being eliminated as of October 1st as well - so purchasing a home before then may gain you a double benefit of tax credits AND seller-paid down payment assistance while it is still available.

2. Larger loans at lower rates: There have recently been provisions in place that have allowed loans larger than $417,000 to qualify for better financing rates than normally would be available for “jumbo” loan amounts of that size, thanks to Fannie Mae and Freddie Mac. Although these provisions were set to expire, they are being extended… however, the top end of the loan size that will be allowed under these programs will be dropping down from $729,750 to $625,500 as of January 1, 2009.

3. FHA Hope for Homeowners: This provision is designed to help homeowners who are “upside down” on their mortgages- that is, they owe more on their house than they can sell it for in today’s market. Essentially, this plan allows homeowners who meet the requirements and are upside down to refinance their mortgage to a new 30-year Fixed FHA mortgage. There are a number of qualifying details that must be met and requirements to be agreed to- including agreeing to split the equity in your home with the government in the future. Still, if you’re upside down on your mortgage and struggling in today’s economy, this is an option worth exploring in more detail.

These are just a few of the provisions that may benefit you, and there are a number of other items that impact the housing and mortgage industry as whole. But the bottom line is, home prices are extremely reasonable right now, home loan rates are low, and new incentives are in place that may help make the decision to buy even more appealing than before. If you’re in the market for a new home or need to make some changes with your current mortgage…there’s never been a better time to act.

Falling U.S. home prices are “nowhere near the bottom” according to Former Federal Reserve Chairman Alan Greenspan in a recent in interview with Maria Bartiromo of CNBC. The interview, in which Greenspan expressed negative comments about our economy and speculated that the U.S. would likely end up nationalizing Fannie Mae and Freddie Mac (the largest sources of money for U.S. home loans), can be seen here. In Q2 of this year, Fannie Mae dropped 5.8 percent in New York Stock Exchange composite trading and Freddie Mac dropped 6.4 percent, according to a Bloomberg update.

What does this mean to home sellers?

If you have a need to sell (as oppose to a want), it’s imperative to aggressively price your home in order to unload it NOW. In addition to a softening market, we are faced with a seasonal slowdown as the summer nears an end. Take a look at the graph below.

When the market was jamming and home prices rapidly increasing, a home seller could throw out a price that was too high and it was just a matter of time before the market caught up and the home sold. It wasn’t until the market turned in 2005 that overpricing a home became detrimental. In our current market, when home sellers overprice their home, they end up “chasing the market” with price reductions without ever reaching the optimum price that produces a sale. The result is a high number of days on market and low selling price. Now take a look at the next graph.

By pricing your home ahead of the market from the get-go, you are able to sell quicker and for higher dollar. Lesson learned: The market shift is here. The seasonal shift is coming. By hoping for a few extra bucks, you could be setting yourself up to lose many. If you’re in a “need to sell” situation, contact a professional real estate consultant to learn how to price your home to sell in this unique market. If you are in a “need to sell” situation and are afraid that the “right” price is less than what you owe, make sure to talk with your Realtor about the possibility of a short sale.