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May, 2006 Newsletter

+++++++++++ May 1, 2006 +++++++++++++++++++

CONTENTS:
Introduction: Increases in Both New and Existing Sales
Mortgage Rate Update: Rates Rise Steadily
This Month's Tip: Guest Article by Don Berthiaume
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Introduction: Increases in Both New and Existing Sales

Welcome to the May edition of the Home Buyer's Newsletter,
brought to you by the
Home Buyer's Information Center.

Sales of existing homes edged up in March following a strong rebound
in February, according to the National Association of Realtors®.

Total existing-home sales – including single-family, townhomes,
condominiums and co-ops – rose 0.3 percent to a seasonally
adjusted annual rate1 of 6.92 million units in March from a pace
of 6.90 million in February, but were 0.7 percent below a 6.97
million-unit level in March 2005.

David Lereah, NAR’s chief economist, said sales are leveling out.
“It’s a good sign to see home sales holding close to the level of a
strong rebound in the month before,” he said. “This is additional
evidence that we’re experiencing a soft landing. We may see
some minor slowing in home sales as interest rates rise, but the
market clearly is stabilizing.” Lereah expects 2006 to be the third
strongest year on record for home sales.

“We now see appreciation cooling to single-digit rates of price growth –
another sign that the market is normalizing,” Lereah said. The national
median existing-home price2 for all housing types was $218,000 in
March, up 7.4 percent from March 2005 when the median was $203,000.
The median is a typical market price where half of the homes sold for
more and half sold for less. Historic price data has been revised back to
1989, including updates to reflect geographic changes over time, but
price patterns are consistent with previously reported data.

Total housing inventory levels rose 7.0 percent at the end of March to
3.19 million existing homes available for sale, which represents a
5.5-month supply at the current sales pace.

In new home sales, sales of new one-family houses in March 2006 were
at a seasonally adjusted annual rate of 1,213,000, according to estimates
released jointly April 26th by the U.S. Census Bureau and the Department
of Housing and Urban Development. This is 13.8 percent (±14.9%) above
the revised February rate of 1,066,000, but is 7.2 percent (±12.8%) below
the March 2005 estimate of 1,307,000.

The median sales price of new houses sold in March 2006 was $224,200;
the average sales price was $279,100. The seasonally adjusted estimate
of new houses for sale at the end of March was 555,000. This represents a
supply of 5.5 months at the current sales rate.

+++++++++++++++++++++++++++++++++++++++++++++

Mortgage Rate Update: Rates Rise Steadily

Mortgage rates showed a fairly consistent increase during the month
of April. According to mortgage company Freddie Mac, the average
for 30-year fixed-rate mortgages stood at 6.58% for the period ending
April 27th after starting the month at an average of 6.35%. There was
a similar trend in 15-year fixed-rate mortgages which began the month
with an average of 6.00% and ended the period with an average of
6.21%.

Clearly, rates have risen in fits and starts over the last year and rather
consistently over the last 60 days. The outlook for the future is a good bit
hazier, however. Whether or not the Federal Reserve pauses or continues
prime rate increases will not have a huge bearing on long-term rates (although
adjustable rate mortgages will definitely see effects). More important is how
the bond market perceives the trend of the future economy. Each economic
report seems to send a different message, meaning that the rate trend is
anything but clear cut.

For current average mortgage rates, see the
rates page.

For more information on mortgages, visit the
Mortgage Section
++++++++++++++++++++++++++++++++++++++++++++++

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++++++++++++++++++++++++++++++++++++++++++++++

This Month's Tip: Make Sure The Steps You Take When Buying A
Home Don't Lead You Down The Wrong Street

- by Don Berthiaume

© Don Berthiaume - All Rights reserved
The Home Buyer's Defense Guide
-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-

Did you know that there are certain steps to buying a home
that you could follow that would make the home buying
process easier for you?

Do you know what those certain steps are?

Before I continue, let me tell you a little story...

Did you ever feel the need to have to restrain yourself from
interrupting someone and interjecting, "You could have
easily avoided your problem had you only...." to someone who
was explaining something to you that had happened to them?

But you couldn't just do that because it would not only be
impolite, but inappropriate at the time?

At my most recent Zoning Board of Adjustment meeting here in
Nashua, one of the cases we heard involved a large 4.45 acre
parcel of land that had been PREVIOUSLY APPROVED (bold,
italics and underscore added for emphasis) 33 months earlier
as a 126 unit, elderly housing development. The development
was apparently never begun as the site still sits vacant
today.

The applicant in front of the Board was now proposing an 80-
unit multi-family development for the property.

To make a long story short, one of the abutters, a young
couple who were opposing the development, got their chance
to speak. They informed the Board how they had signed the
purchase and sales agreement for their home eight months ago
and finally moved in 4 months ago.

They relayed their concerns about the development because
they would be losing their view and it would result in more
neighborhood traffic; that the value of their recently
purchase home would be adversely affected.

The Chairman proceeded to ask this question, "Did you know
that the site right next door to you was approved 33 months
ago for a more intense use that what is being proposed now
for that very same parcel?"

They replied..."No, they were not informed about it."

When asked if their agent ever brought it up, they also said
no.

I had to grip the seat of my chair with both hands at this
point.

Because it really took all I could to remain in my chair and
not jump up and shout, "You should have done your
homework!"

Situations like this continue to happen every single day.

If only home buyers knew enough about what information they
should be looking at when buying a home, they wouldn't be
turning in unhappy homeowners - like this couple did.

And now, there was nothing they could do.

They were powerless.

The sad fact is, the parcel had already been approved and
they knew nothing about it when they bought their home.

They had made what was likely the largest, single investment
of their life - and now coming to grips that perhaps it was
not the right decision, based upon the information they now
had - that they could have had before they made the
purchase.

Yes, there are certain steps you need to take when buying a
home. One of these steps is to not only get as much
information on the property you want to buy, you also need
to get as much information on the abutting properties and
neighborhood in general. Once you know what questions to ask
and who to see, it really isn't hard to do.

Asking questions - and as many as you can - is what it takes
to not get taken to the cleaners during the home buying
process, or end up with little post-purchase surprises.

In the "Home Buyer Defense Guide" I list ten types, or
categories, of questions you should be asking as a home
buyer.

Here are 4 of them:

* Questions you may never have remembered to ask - but now
you will!

* Questions the seller will not want to answer - but ones
they'll have to if they want to sell to you!

* Questions you may be sorry you asked - ones that might
find you walking away from a potential purchase, but for
all the right reasons.

* Questions you'll be glad you asked - the ones that will
always get you what you want - and not get stuck with
something you don't want!

What ever you do during your home buying process, be sure
your steps include knowing which questions to ask and asking
the right people, so YOU don't get stuck with a home you
don't want.

--
Don Berthiaume has been involved with real estate for over
21 years. He is the author and publisher of the "
Home Buyer
Defense Guide
".

He can be reached by email at:
don@homebuyerdefenseguide.com

-=-=-==-=-=-=-==-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-
Buying a home soon and looking for some money-saving tips?

Asking the right questions when buying your next home could
save you thousands of dollars. Discover exactly what these
questions are and who you should be asking to get the
answers you need.


Next Month's Topic: Getting the Representation You Need

++++++++++++++++++++++++++++++++++++++++++++++

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
here
.

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
here.

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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