Finally – ‘SOLD’ signs appear
Brokers across the Hudson Valley agree: Mortgage rates are lower than they can ever remember, but financing is more difficult to obtain than in prerecession days, especially for those with less-than-stellar credit scores.
For those who squirreled away money for a rainy day, or second-time home buyers who didn”™t max out their property”™s value during the housing boom, coming up with a 20 percent down payment is not going to be difficult, said Greg Rand, managing partner of Better Homes and Gardens Rand Realty, based in White Plains.
“Residential property is actually pretty hot right now throughout the Hudson Valley,” said Rand. “We had a record-breaking four months for the beginning of 2010 and sold 797 homes in April, double our typical number of sales –Â even during the ho
Rand said it isn”™t a question for many of “wanting to buy ”“ the question is, Were they willing? Buyers wanted to see the housing market stabilize, and I think it has. I do believe we”™ve seen the worst and house prices are going to remain at the level we see now.”
“The tax credit definitely inspired purchasers to take the plunge and take advantage of either an $8,000 or $6,500 incentive, but “it was a matter of timing, not a matter of wanting to purchase a home. Why wait till June or July when you can get an extra incentive for buying? It just made it that much more sensible for those who were ready to buy a home, anyway. It just speeded up their decision making,” said Rand.
Laurie DiFrancesco is working with ugar Loaf builder Angelo Menna at Woodbury Fields, a high-end development in Central Valley. “I think we”™ve hit bottom and the market has stabilized,” said DiFrancesco. “Mortgage rates are unbelievably low, so affordability is high….but without good credit and an established employment history, financing is going to be that much more difficult. If your credit score is 640 or above and you have the income to afford it, banks are not concerned about home prices going much lower. From their perspective, the price you pay today will remain at that level or go higher in the next 10 years. Still, it requires a lot more paperwork for the purchaser, and there is more due diligence on the part of banks because of the mortgage meltdown.”
Menna is building a house in Rockland County”™s village of Palisades, where he is using geothermal technology for heating and cooling. “Yes, it does add to the cost of the home, but we have the technology to do it. It makes more sense for builders to go this route because it is cost effective in the long run for the home purchaser and reduces our reliance on fossil fuels. It really does pay for itself when the purchaser sees the utility bill is half what it would have been if the house was built conventionally.”
Robert Morini, manager of Houlihan Lawrence”™s Millbrook office, said the market has “picked up considerably since this time period last year ”“ last year was disastrous for everyone. But we are optimistic that even without the federal tax incentive, our sales base will remain the same. There”™s a lot of traffic, and the tax credit ended a month ago. People who were waiting for the market to stop falling are now out looking.”
He added a word of caution:Â “Be prepared to have a minimum 20 percent down payment for a conventional mortgage. With an FHA mortgage, you can put down ten percent or a bit less, but there is a longer wait time because of the backlog.”
And for those who are tired of renting and ready to put down permanent roots? Start saving, say brokers. The days are gone when you could buy a home with nothing down except a credit score. “Credit scores need to be at least 640 ”“ the higher the better,” said DiFrancesco. A solid job history is going to go a lot further when looking to put down roots, added Morini. “Right now, prices in Westchester and Rockland have bounced back more so than the rest of the Hudson Valley.
“If people are willing to travel further north and make a longer commute if they work in New York City, they are going to get a more affordable home.” Morini said, although longer rides to and from work can be draining. “For some, it”™s a quality of life issue. They want a nice neighborhood and good schools and activities. They are willing to sacrifice and put in the travel time to provide that.”
Rand had some advice for home buyers who took advantage of the tax incentive, but who may not be able to close by June 30 because of various delays: “Negotiate with the builder or homeowner. If they weren”™t able to get you the property on time and you lose out because of it, there is definitely room for discussion.”