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April, 2008 Newsletter

+++++++++++ April 1, 2008 +++++++++++++++++++

Introduction: Existing Sales Up, New Sales Down
Mortgage Rate Update: Volatile Month for Rates
This Month's Tip: Understanding Representation

Introduction: Welcome to the April edition of the
Home Buyer's Newsletter.

Sales of existing homes increased in February and remain
within a fairly stable range, according to the National
Association of Realtors®.

Existing-home sales – including single-family, townhomes,
condominiums and co-ops – rose 2.9 percent to a seasonally
adjusted annual rate of 5.03 million units in February
from a pace of 4.89 million in January, but remain 23.8
percent below the 6.60 million-unit level in February 2007.
The sales pace has been in a fairly narrow range since last September.

Lawrence Yun, NAR chief economist, said the gain is encouraging.
“We’re not expecting a notable gain in existing-home sales until
the second half of this year, but the improvement is another sign
that the market is stabilizing,” he said. “Buyers taking advantage
of higher loan limits for both FHA and conventional mortgages will
unleash some pent-up demand. As inventories are drawn down,
prices in many markets should go positive later this year.”

The national median existing-home price for all housing
types was $195,900 in February, down 8.2 percent from a year
earlier when the median was $213,500. Because the slowdown
in sales from a year ago is greater in high-cost areas, there
is a downward pull to the national median with relatively fewer
sales in higher priced markets.

This downward pull on the national median is most likely attributed
to the greater slowdown in sales from a year ago in high cost areas.

In new home sales, Sales of new one-family houses in February 2008
were at a seasonally adjusted annual rate of 590,000, according to
estimates released jointly on March 26th by the U.S. Census Bureau
and the Department of Housing and Urban Development. This is 1.8 percent
below the revised January rate of 601,000 and is 29.8 percent below
the February 2007 estimate of 840,000.

The median sales price of new houses sold in February 2008 was $244,100;
the average sales price was $296,400. The seasonally adjusted estimate of
new houses for sale at the end of February was 471,000. This represents a
supply of 9.8 months at the current sales rate.


Mortgage Rate Update: Volatile Month for Rates

In one of the most volatile months in recent memory, mortgage rates
jumped all over the map during the month of March. According to mortgage
company Freddie Mac, 30-year fixed-rate mortgages averaged between
5.85% in the period that ended on March 27 and 6.24%
at the end of February, a large swing for a 30-day
period with rates both rising and falling during the month.
15-year fixed rate mortgage rate activity was also fairly active,
ranging between an average of 5.72% and 5.34%.

This volatility is due to a number of factors, the largest of which
is the fact that there is no real agreement on where the economy is
headed in the near term. It seems that virtually every day an
economic report is issued which, to some degree, conflicts with
a report that was released only a few days or weeks earlier. Going
forward, many analysts forecast the volatility to continue, with
no clear trend apparent.

For more information on mortgages, visit the
Mortgage Section

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This Month's Tip: Understanding Representation

For most home buyers, the process is not a solitary one. There
will be a number of professionals who will assist in the purchase
of a home. It is important to understand, then, what each of
these "assistants" will be responsible for and, most importantly,
how they represent the buyer. To misunderstand the role that
each plays may leave a buyer open to disapointment at the
least, and subject to major snags at the worst.

Probably the most important representative of your interests
will be your Real Estate Agent. Although the scope of
representation will vary a bit from area to area, at a
minimum, an Agent will need to designate who they will
represent: buyer, seller or both. Do not assume that,
as a buyer,an Agent will automatically represent your
interests exclusively. In general, the opposite is
true, meaning that an Agent, by default, will represent
the seller, even if they have been working directly
with the buyer. In the majority of areas, however,
the existence of "Buyer Agency" allows an Agent
to represent your interests as a purchaser.

If you have a Buyer Agency agreement with an Agent, it means
that your interests will be paramount. This means, for
example, that this Agent would not be able to reveal any
information about you to the seller unless you authorize
it (the most common instance of this would be the amount
that you would be willing to pay for a property in the
negotiating process).

You will likely have dealings with mortgage professionals
if a portion of the home cost involves a loan. Unlike the
agency relationship involved with Real Estate Agents, the
relationships with mortgage professionals are not regulated
by law. Although a mortgage officer or broker may well look
out for your interests, there is not a fiduciary relationship
involved, meaning they are not legally bound to represent you.
It is important, therefore, to be very aware of the specifics
of any and all loan applications, documents and requirements.

In regards to settlements and closing, if you are represented
by an Attorney, there will be a legal relationship of
representation involved. Your interests should be of primary
importance, meaning that you will have a level of protection
regarding contracts, deeds and the like. In most cases, there
will be title searches (and insurance) that will protect your
rights in the property you are purchasing. If you are using a
source other than an Attorney for your settlement, it is
important to determine exactly what level of representation
is involved with your closing agent.

Summing Up

Do not simply assume that because a professional is working
WITH you that they are automatically a representative FOR
you. Clear up any misconceptions in advance so as to not
have a nasty surprise at the eleventh hour.

Next Month's Tip: Buying With Common Sense

The Home Buying Checklist

Many of our visitors have said that one of the most valuable
aspects of the Home Buyer's Information Center is the
Buying Checklist, where they can make sure that all
the bases have been touched.
You can find the checklist

As always, if you have suggestions for improving the
site, or topics you would like to see addressed in
this newsletter (or, if you have used the Home Buyer's
Information Center to successfully purchase a home),
drop us a quick line

A special thanks to all those who have written to let us know
that they have found the Home Buyer's Information Center a
helpful resource in their buying process.

Have a great month and good luck in all your endeavors!

The Team at the Home Buyer's Information Center

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