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August 2011 Real Estate Update

08/19/2011

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"...Highest quality of service."

We greatly appreciate Eric's prompt action and loyal dedication to providing the highest quality of service.

~ Jim & Amy Lee

Contest Your Property Taxes

This year I have seen several of my client's properties taxed at a higher value than what they actually sold for in this market. So, this month I wanted to make you aware of what you can do if you feel that your home is taxed higher than what it should be. Here are some qualifications that the county will use to potentially reassess your taxes:

1) If homes in your neighborhood have been selling lower than your assessed value.

2) If the assessed value is greater than 1/3 of your recent purchase or current appraisal.

3) If your property is currently listed for sale for less than the assessed value.

You only have until September 9, 2011 to make your appeal. Forms for residential, commercial, and farm land are available at:

http://www.co.champaign.il.us/BOR/borforms.htm

LOW INVESTOR RATES!

Wow, I have had to re-write this section several times as interest rates drop several times this week. I don't know if we have ever seen rates this low for investors. Today investor rates for single family homes are at 3.75% with 25% down on a 15 year fixed. Duplex rates are at 4.0%.

Opportunities:

There is a 3 bedroom home in Mahomet that will be coming for sale this week priced at $124,900.

Also, a duplex in South Urbana near vine with rents of $1,424mo is for sale. Asking price $144,000.

Eric's Notes

M any industry experts are weighing in on how the downgrade of the U.S.'s credit rating from Standard & Poor will effect interest rates for consumers. Across the board, they are expecting rates to rise. However, in a news report Tuesday, the Fed announced that they expect to keep interest rates low through mid-2013. This should allow more people to qualify for loans, and take advantage of these ultra-low interest rates. This should be attractive for investors looking to pick up properties that could cash flow well. Refinancing has also picked up. One lender, with whom I speak, with said that he can hardly keep up with the refinance orders.

Source: "Fed says it Will Hold Rates Fast Until mid-2013," MSNBC (Aug. 9, 2011)

Here are rates from yesterday:

FHA: 4.25%

Total payment on $100,000 loan: $812 mo

(includes P&I, T&I, and PMI).

Rural Development 100% loan: 4.125%

Total payment on $100k loan: $709 mo

(P&I, T&I).

Conventional 30 yr: 4.375%

Total payment on $200k loan: $1,339 mo

(P&I, T&I).

Conventional 15 yr: 3.5%

Total payment on $200k loan: $1,770 mo

(P&I, T&I)

Investment property (25% down) 15 yr: 4.0%

Total payment on $100k loan: $972 mo

(P&I, T&I)

As I was finishing the details of this newsletter today, new interest rates were posted. Here are the changes: FHA & RD are both now at 4.0%; Conventional 30 yr is 4.0% and 15 yr dropped to 3.25%. Investor Rates: 15 year fixed 25% down dropped to 3.75%!

* P&I: Principal & Interest, T&I: Taxes & Insurance, PMI: Mortgage Insurance

Rural Development does NOT have mortgage insurance.

UPDATE FROM LAST MONTH:

Last month I highlighted several top properties. The 2 bedroom condo at Capstone Quarters sold and closed for $10,000 less than similar 2 bedroom condo that sold the same day in this complex. Also, the foreclosure in Trails Edge (by Trails of Brittany) sold along with the historic 1960's home on Litchfield.