Mortgage interest rates rose for the the third time in just four weeks. The rise should set off alarm bells for prospective buyers still unsure about entering the market. While home values are not expected to gain much ground in the near future, mortgage rates are much more volatile and will probably continue this incremental climb. Economists have attributed the rise in rates to positive economic news. As the rebound continues, the historically low rates are also sure to rise.

Ki Gray gives his take on changing mortgage interest rates:

“What is interesting is that the current (small) upward movement in mortgage rates might be the beginning of the rise that many in the financial industry have predicted. If the economy continues to rebound this could be the beginning of mortgage rates steadily moving up to 10 percent or higher. This is of course dependent on the continued movement of the U.S. economy out of the current recession. While the government has made some statements about curbing inflation, it seems more concerned with making sure the U.S. exits the recession. Of the  four major indexes, three moved up this week. The 30-year note rose from 5.22 to 5.29, the 15-year mortgage rose from 4.63 to 4.68 and the 5-year ARM rose from 4.73 to 4.75. The 1-year ARM fell from 4.78 to 4.72.”

The potential for buyers to get a good deal in Real Estate will exist as long as values stay low. But to get unprecedented savings, buyers will have to act fast. Not only are interest rates set to rise, but the $8,000 tax credit from the Fed is set to expire this coming December.

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First-time buyers purchasing in desirable areas are choosing the low-maintenance lifestyle of condominiums. Condos let a buyer make a well-priced investment, while getting to take advantage of shared amenities like pools and gym rooms. In major cities where condo owners only use their condos for vacation or temporary business use, they can rent out the space to visitors. This arrangement is called a condotel– being one part condo, one part full service hotel. However, getting financing on a property like this can be tricky due to the uncommon usage.

Jeffrey Gilliam explains more about condotels:

“So what makes a condo-tel? Actually, any number of things. I have heard many times that a project is not a condo-tel because it doesn’t have an on-site rental desk. While an on-site rental desk would classify a project as a condo-tel the absence of one does not make it immune. (1) If they have a website that advertises rentals, it is a condo-tel. (2) If an owner is required to rent per the bylaws, it is a condo-tel. (3) If it has daily maid service, it is a condo-tel. So if a project doesn’t have any of these things, then it is okay with Fannie and Freddie and is fixed-rate financing available? Not necessarily. There is another classification we use for condominiums and this is the term ‘warrantable.’ Warrantable refers to whether it can be warranted as sellable to Fannie or Freddie meaning it meets their criteria for an acceptable condominium project. So what makes a condominium ‘non-warrantable’?”

A condotel is a perfect way for a condo owner to leverage the management of their property to bring in income when they are away. With all of the amenities luxury condos are being built with, they make the perfect location for a temporary stay. As Gilliam points out, the issues surrounding these properties make financing difficult. While there are banks willing to take the risk of financing a condotel, they are doing it with a slight premium to a 30-year fixed-rate mortgage.

Click through to read Jeffrey Gilliam’s full post.

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First-time buyers purchasing in desirable areas are choosing the low-maintenance lifestyle of condominiums. Condos let a buyer make a well-priced investment, while getting to take advantage of shared amenities like pools and gym rooms. In major cities where condo owners only use their condos for vacation or temporary business use, they can rent out the space to visitors. This arrangement is called a condotel– being one part condo, one part full service hotel. However, getting financing on a property like this can be tricky due to the uncommon usage.

Jeffrey Gilliam explains more about condotels:

“So what makes a condo-tel? Actually, any number of things. I have heard many times that a project is not a condo-tel because it doesn’t have an on-site rental desk. While an on-site rental desk would classify a project as a condo-tel the absence of one does not make it immune. (1) If they have a website that advertises rentals, it is a condo-tel. (2) If an owner is required to rent per the bylaws, it is a condo-tel. (3) If it has daily maid service, it is a condo-tel. So if a project doesn’t have any of these things, then it is okay with Fannie and Freddie and is fixed-rate financing available? Not necessarily. There is another classification we use for condominiums and this is the term ‘warrantable.’ Warrantable refers to whether it can be warranted as sellable to Fannie or Freddie meaning it meets their criteria for an acceptable condominium project. So what makes a condominium ‘non-warrantable’?”

A condotel is a perfect way for a condo owner to leverage the management of their property to bring in income when they are away. With all of the amenities luxury condos are being built with, they make the perfect location for a temporary stay. As Gilliam points out, the issues surrounding these properties make financing difficult. While there are banks willing to take the risk of financing a condotel, they are doing it with a slight premium to a 30-year fixed-rate mortgage.

Click through to read Jeffrey Gilliam’s full post.

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Despite signs of stabilization in the past months, the foreclosure numbers for July remind everyone that the housing market, and the economy as a whole, is still in recovery. The rise in foreclosures is not an anomaly. In fact, many analysat predicted July would see a rush of foreclosure listings as the government’s moratorium on foreclosures ended. While the moratorium undoubtedly helped some families who were in line for loan modifications, it only prolonged the inevitable for others. As in months past, the states with the highest foreclosures were California, Florida, and Nevada.

 Bob Phillips explains more about the concentration of foreclosures:

“Foreclosure tracker RealtyTrac reports that the number of foreclosures nationwide rose 7 percent on a month-to-month basis last month. However, three states dominated the foreclosure list, tallying more foreclosures between them than the rest of the country combined. California : 30.0 percent, Florida : 15.7 percent, and Arizona : 5.4 percent. On a per household basis, the states ranked 2, 3 and 4. Only Nevada’s foreclosure rate was higher. Now, we point out these statistics for two reasons. The first is to remind you that foreclosures can be highly local. For all of the foreclosure-related stories that run in the papers and on TV, defaults make a much larger impact on home values in some areas versus others. And, second — foreclosures can represent a terrific buying opportunity. Not every foreclosed home is in pristine condition, but there is a plethora of affordable housing out there, suitable for first-time buyer, move-up buyers and investors, too.”

Foreclosures continue to offer great opportunities in desirable areas that were once out of reach for first-time buyers. As long as lenders can keep up with loan applications and banks can process the REO sales, it is likely the increase in inventory will be only a temporary hurdle towards recovery.

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Despite signs of stabilization in the past months, the foreclosure numbers for July remind everyone that the housing market, and perhaps the economy as a whole, are still in recovering. The rise in foreclosures is not an anomaly. In fact, many analysat predicted July would see a rush of foreclosure listings as the government’s moratorium on foreclosures ended. While the moratorium undoubtedly helped some families who were in line for loan modifications, it only prolonged the inevitable for others. As in months past, the states with the highest foreclosures were California, Florida, and Nevada.

Bob Phillips explains more about the concentration of foreclosures:

“Foreclosure tracker RealtyTrac reports that the number of foreclosures nationwide rose 7 percent on a month-to-month basis last month. However, three states dominated the foreclosure list, tallying more foreclosures between them than the rest of the country combined. California : 30.0 percent, Florida : 15.7 percent, and Arizona : 5.4 percent. On a per household basis, the states ranked 2, 3 and 4. Only Nevada’s foreclosure rate was higher. Now, we point out these statistics for two reasons. The first is to remind you that foreclosures can be highly local. For all of the foreclosure-related stories that run in the papers and on TV, defaults make a much larger impact on home values in some areas versus others. And, second — foreclosures can represent a terrific buying opportunity. Not every foreclosed home is in pristine condition, but there is a plethora of affordable housing out there, suitable for first-time buyer, move-up buyers and investors, too.”

Foreclosures continue to offer great opportunities in desirable areas that were once out of reach for first-time buyers. As long as lenders can keep up with loan applications and banks can process the REO sales, it is likely the increase in inventory will be only a temporary hurdle towards recovery.

Click through to read Bob Philips full blog.

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REALTORS®  are seeing more and more bank-owned properties go into multiple offers. Unfortunately for them, and their clients, many of these properties are sold to investors and not first-time buyers hoping to find a great deal. Many times, banks choose to sell to investors over buyers becuase the investor can make a cash payment. This situation has led to some negative feelings toward investors, especially when they come into an area, buy up a large amount of properties in and don’t use Realtors to relist the properties once they are flipped.

Pat Palmer has another view, and shares why we need good investors in the market:

“We need to have more investors in the market and we need them flipping properties. There, I said it. I know it won’t be long until the riotous crowds start descending on me. But before they do, let me explain. Investors aren’t the scourge of the earth. Well, at least not most of them. They are looking to buy an under-valued asset. No different than a stock or a bond fund. And here’s why investors are helpful in this market: There are hundreds of thousands of REO and short sale properties on the market. Values will not be going up until demand at least equals supply. In the ever-tightening lending markets, investors fill a void by paying cash. It’s very true that they may take a potential buyer out of a transaction, but that buyer should be putting offers in on multiple homes, thereby taking two properties off the market. Investors buy up a lot of the very distressed (read: completely trashed) properties. These are units that, due to health and safety issues, cannot be financed anyway. Investors buy these up cheap, and fix the inherent problems. At this point,the unit has now gone from total disrepair to some form of turn key for a buyer.”

With the amount of toxic assets the banks are holding on to, it may not be a bad thing when an investor can afford to buy homes in bulk. Even though they may take good deals from buyers and commissions from Realtors, the long term goal for everyone is market stabilization. Having investors buy up properties, turn them, and sell them for more than the bank would have will only help that goal.

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The list of new and innovative green building materials keeps growing as homeowners increasely demand earth-friendly, sustainable products. Many of these ingenious products are made from recycled everyday items and others are old items that have been remade with greener standards. These amazing advances in technology are helping builders build better homes while keeping utility bills lower for those that buy them.

Carol Chiafalo provides us with a list of great new green products for your home:

“I am a REALTOR® and I am a builder in the ‘green’ city of Decatur, Georgia.  I have no problem spending a few extra bucks today on a furnace system that will heat and cool a home for years to come without using nearly as much fuel as the older, inefficient systems. I love the new insulation products that keep conditioned air on the inside and raw elements on the outside. One insulation product is made from shredded newspaper and another uses blue jeans lint. What could be better re-purposing than that? (There is even clothing fabric made from bamboo! Wow, what next? But that is another topic.) Windows have seen a new light, too. Self-cleaning double- and triple-glass panes filled with Krypton and treated with reflective coatings are the greatest things since sliced bread.”

The movement to make greener homes and greener lives has led to an abundance of creative and technologically-advanced alternatives to the old standards. Remember, buying green products are an investment. While these products generally cost more initially, their durability and efficiency will pay for themselves over time.

Click through to read Carol Chiofalo’s full post.

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Home values are expected to rise in the next few years, returning equity to homes that are currently underwater. However, most economists agree that the days of big returns from inflated prices are long gone. With the stock and bond markets also providing irregular returns, homeowners look for new ways to invest their money. Experienced Real Estate investors may see this decline as simply the ebb in an ongoing cycle of home values that rise and fall. But the recent housing collapse has left many distrustful of the once rock-solid investment.

Ravpreet Singh explains why storage facilities are a smart investment:

“A lot of people have recently asked me about a self storage business. While I am not an expert in this subject, I will try to outline a few reasons people get into this business model. Self storage investing can offer you a stable, first step in generating a higher net worth. By being a business that is typically more profitable, a self storage unit can be a great way to consistently generate income. This is possible because a self storage facility has relatively low monthly maintenance costs. Typically, there is no inventory to tie up capital, there is a minimum commitment to labor costs, and depending on the location of the property, taxes associated with the property can be next to nothing. All the money, therefore, that is created by the actual service being rendered (in this case storing goods) is then translated directly into profit.”

The right commercial Real Estate or small business investment can be a great, low-risk way to make more money. Although they can require a substantial time commitment, depending on the type of business, many times the overhead is small and the returns are worth it. Businesses like storage facilities are great because they will be in demand regardless of the economic climate.

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The short sale process has become the new staple for many REALTORS® working in states like California, Florida, and Arizona, to name a few. The ever-changing regulations that affect this process further emphasize the need for Realtors to continue their education if they want to be seen as an expert in this arena. Knowing what is involved and the delays that can occur will help you give your clients an accurate timeframe to work with.

Erin Attardi posts about the new delays caused by mortgage insurance companies:

“With the bulk load of short sales that I am negotiating, there is an interesting phenomena I am running into more and more these days. Lenders are placing their own mortgage insurance policies on loans. This is not your typical private mortgage insurance (PMI) that a borrower pays on a loan in instances they put less than 20 percent down. Instead, the lender places it on the loan after it is originated at their own expense and without the borrower’s knowledge. As a short sale listing agent, oftentimes I will not even discover this information until I get to an advanced stage of negotiation. Low-level lender customer service, collections, and loss mitigation departments will not necessarily have this information. Why is this a big deal? The mortgage insurance company gets involved in analyzing the short sale, and has the final say in whether or not the short sale is approved! So what does this really mean?”

If a Realtor lacks a full understanding of the short sale process and is caught off guard by delays and new regulations, it will frustrate their clients and keep them from referring them to their friends. One easy way to stay educated and up to date with the latest Real Estate information is by picking a few blogs to read daily. Since blogs are updated daily, they can be a great resource for a Realtor looking to become a local expert.

Click through to read Erin Attardi’s full post.

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The short sale process has become the new staple for many REALTORS® working in states like California, Florida, and Arizona, to name a few. The ever-changing regulations that affect this process further emphasize the need for Realtors to continue their education if they want to be seen as an expert in this arena. Knowing what is involved and the delays that can occur will help you give your clients an accurate timeframe to work with.

Erin Attardi posts about the new delays caused by mortgage insurance companies:

“With the bulk load of short sales that I am negotiating, there is an interesting phenomena I am running into more and more these days. Lenders are placing their own mortgage insurance policies on loans. This is not your typical private mortgage insurance (PMI) that a borrower pays on a loan in instances they put less than 20 percent down. Instead, the lender places it on the loan after it is originated at their own expense and without the borrower’s knowledge. As a short sale listing agent, oftentimes I will not even discover this information until I get to an advanced stage of negotiation. Low-level lender customer service, collections, and loss mitigation departments will not necessarily have this information. Why is this a big deal? The mortgage insurance company gets involved in analyzing the short sale, and has the final say in whether or not the short sale is approved! So what does this really mean?”

If a Realtor lacks a full understanding of the short sale process and is caught off guard by delays and new regulations, it will frustrate their clients and keep them from referring them to their friends. One easy way to stay educated and up to date with the latest Real Estate information is by picking a few blogs to read daily. Since blogs are updated daily, they can be a great resource for a Realtor looking to become a local expert.

Click through to read Erin Attardi’s full post.

Sign up for a free Featured Blog on Realtor.com today.