From “Realtor.org”

You’ll likely be responsible for a variety of fees and expenses that you and the seller will have to pay at the time of closing. Your lender must provide a good-faith estimate of all settlement costs. The title company or other entity conducting the closing will tell you the required amount for:

• Down payment
• Loan origination
• Points, or loan discount fees, which you pay to receive a lower interest rate
• Home inspection
• Appraisal
• Credit report
• Private mortgage insurance premium
• Insurance escrow for homeowner’s insurance, if being paid as part of the mortgage
• Property tax escrow, if being paid as part of the mortgage. Lenders keep funds for taxes and insurance in escrow accounts as they are paid with the mortgage, then pay the insurance or taxes for you.
• Deed recording
• Title insurance policy premiums
• Land survey
• Notary fees
• Prorations for your share of costs, such as utility bills and property taxes

A Note About Prorations: Because such costs are usually paid on either a monthly or yearly basis, you might have to pay a bill for services used by the sellers before they moved. Proration is a way for the sellers to pay you back or for you to pay them for bills they may have paid in advance. For example, the gas company usually sends a bill each month for the gas used during the previous month. But assume you buy the home on the 6^th of the month. You would owe the gas company for only the days from the 6^th to the end for the month. The seller would owe for the first five days. The bill would be prorated for the number of days in the month, and then each person would be responsible for the days of his or her ownership.

What’s In, What’s Out

Each year, Mark Nash of Coldwell Banker Residential Real Estate in Chicago asks subscribers to his e-zine what buyers want most. His most recent poll shows:

IN

• A reduced carbon footprint: How your home and you impact the earth matters to more buyers who want a home that lets them save energy and lessen their contribution to global warming.

• Outdoor living: Massive fireplaces, outdoor kitchens, and under-patio heating to extend the season are not just for the Sun Belt anymore.

• Fully concealed appliances: That wood-printed cover for the fridge is not enough any longer; now appliances are hidden behind hinged doors.

• Floating homes: Not your father’s houseboat, these nonmobile homes are basically ranch houses sitting on stationary barges in a lake or river.

• Home elevators: Even builders of mid-priced homes are adding this essential for boomers wanting to age in place.

• Pet showers: Clean pets mean clean homes, and who wants to mess up the bathtub when this feature can be a part of the garage or mudroom?

• Freestanding bathtubs: These oversized soaker tubs, or “bath thrones,” have supplanted whirlpool baths as the must-have bathroom centerpiece.

• Bathroom suites: Whether it’s multiple flat-screen TVs or a mini fridge and cappuccino maker, you’ll soon have a whole home inside this one room.

(This information was re-printed from realtor.org)

Here is a brief article that appeared in the Friday, 3/21 issue of the Birmingham Business Journal:

Friday, March 21, 2008

Birmingham area near top of pack in affordable homes

Birmingham Business Journal - by Lauren B. Cooper and G. Scott Thomas ACBJ

Birmingham now ranks third in the nation for affordable housing, outpacing at least seven other Southeastern cities.

According to a study of the nation’s largest 50 metro areas conducted by American City Business Journals, parent company of the Birmingham Business Journal, the metro area’s median monthly housing payment was $753, taking a little over 20 percent of local homeowners’ median monthly household income of $3,711.

That’s $86 more than No. 1 ranked Oklahoma City, $391 less than the national average and $2,738 less than Los Angeles, ranked the least affordable city in the nation.

The Magic City ranked highest in the Southeast as well, listed above other top affordable cities such as Memphis (No. 9), Louisville (No. 11), Charlotte (No. 12), Nashville (No. 16), Atlanta (No. 17), New Orleans (No. 1 and Jacksonville, Fla. (No. 25).

There is good news and bad news in the current real estate market.  February numbers are in for the Birmingham market, and the average sales price, compared to a year ago, has dropped from $186,311 to $178,600, although “DOM” (days on market) has also dropped from 113 to 90, indicating brisker sales, according to Dave Mace, at the Birmingham Association of Realtors.  He also said that total sales in the Birmingham MLS in February were 979, compared to 1,250 in February, 2007.  The median home price has stayed the same.  Homes in lower price brackets tend to turn over faster than the $300+ price points, in my experience.

NOW IS A GREAT TIME TO BUY.  The selection is amazing, in both new homes and re-sales.  Interest rates remain low.  The limit on FHA loans has increased to just over  $178,000, and, while subprime loans and other risky mortgage products have all but disappeared, more buyers will have access to these safer FHA loans and other lower-interest rate loans in high-cost areas, according to Mace.  On the other hand, by the end of March, 100% financing will virtually disappear.  We have heard the new max will be 97%.

Yet many buyers seem to be holding out.  For what?  Are they expecting further dramatic decreases in home prices?…more desperate sellers trying to dump their homes at any cost  hoping to avoid foreclosure?  (well, yes, there’s always some of that going on…)  Wayne’s personal experience has been that buyers have so much to choose from right now that they are looking…looking…looking…for exactly what they want (or for a fire sale on something close) but remain very slow to make offers.  Frequently the offers they do make are so low that sellers, realistically, can’t even consider them, so they are, essentially, a waste of everybody’s time, and never result in a binding contract.  Other Realtors® have said to me that they think buyers’ expectations may be somewhat unrealistic, in terms of what they can get for the money.  Sellers who are anywhere short of facing impending foreclosure may be willing to reduce their profit, but are not going to suffer a loss on their property.  While it may be that sellers don’t really expect full price offers in this market, it is so competitive that many have cut their asking price to very near their bare bones minimum.  To take much less could mean a loss, and if they DO have to take a loss, it won’t be a very big one. 

Bottom line?  There will probably not be, in the foreseeable future, a better time to buy than now.  Inflation, rising costs of construction, and the state of the economy (are we in a recession?) are all still pushing up the cost of housing over time.  Who knows where interest rates will go, but they probably won’t go a whole lot lower.  Good, safe loans are out there for those who qualify.  The selection is way more than adequate.  So IF you are serious buyer, now is the time.  But be realistic when you make an offer, whether to a re-seller or a builder.  The myth that you’re going to get something for half of what it’s worth is…at least 98% of the time…just a myth.  The standard for sellers a few years ago was to seriously consider an offer down to 97% of asking price.  It may be lower than that now, maybe 94-95%.  But sellers have already come way off the price they want, and have less room to dicker.  Birmingham is NOT Detroit, South Florida, Las Vegas or Silicone Valley.  We never really had a real estate bubble, and the bubble has not burst.  Our home  price appreciation over the years has remained realistic, at an average 3-5% per year, not 3-040%; so housing here is not dramatically overpriced, even for today’s market.  So buyers AND sellers have to use reason in cutting deals that can actually work. 

Come “off the sidelines” and Buy something.  You’ll be glad you did.  So will I.!  And, by the way, one way to get an even BETTER deal on the home your buying is to take advantage of the unique Buyer’s incentive program that we offer our buyers.  Check it out on our website.  We can, literally, put THOUSANDS of dollars back in your pocket when you close on your next home.