Tom Crowe's Real Estate Blog | Allen Park, MI | Mortgage, Housing Market, Buy House, Home Buyers, Foreclosures

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Tom Crowe

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First Time Buyer Tax Credit

Posted by Tom Crowe | on Monday, October 19th, 2009 at 11:39 am
Category: Homes.

The first time buyer tax credit expires on 11/20/2009.   This means you have to be closed by this date in order to qualify.  There is legislation pending that will extend this tax credit, but to date has not passed.  If you live and work in Michigan this tax credit is essential to our economy.  Please go to to support this initiative.

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FICO Scores

Posted by Tom Crowe | on Thursday, September 17th, 2009 at 2:06 pm
Category: Homes.
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Was told today that minimum FICO (credit) scores were increased from 620 to 640. Does not make sense to me…banks are using TARP money to invest in other revenue streams and buying up smaller banks.   This will reduce the number of first time buyers that previously could have purchased a house.

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Checking The Progress of Home Sales

Posted by Tom Crowe | on Wednesday, September 16th, 2009 at 2:19 pm
Category: Homes.

One way to look for market improvement when you are or have been in a declining market is to look at the difference between list price and sales price.  I am looking at private owned sales for the months of July, August and the first 15 days of September.  Here is what I discovered.

July: List Price/Sales Price            August: List Price/Sales Price             September List Price/Sales Price

$100,197/$90,885 +/-  9%            $84,694/$79,688 +/- 6%                      $69,900/$69,600 +/- .5%

There is not any consistency, but let’s keep watching it as we work through the fall and winter.  I’ll redo this at the end of September.  Any questions please comment or call…Thanks!

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First Time Buyer Tax Credit

Posted by Tom Crowe | on Sunday, August 30th, 2009 at 8:20 am
Category: Homes.

If you are serious about taking advantage of the “First Time Buyer Tax Credit” you better start getting busy with finding your new home. The program is slated to end November 30, 2009. That means you have to have closed the transaction by this date. There is talk about an extension, but the bill is still pending.

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More On Seller Concessions & Discount Points

Posted by Tom Crowe | on Saturday, August 29th, 2009 at 12:08 pm
Category: Homes.
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Any time you enter into a negotiation on an offer to purchase on your home you always have to determine what is the breaking point. What this means is at what point do you say that enough is enough and you don’t care if you lose the buyer or not. Now, please realize that the housing market in the Allen Park or the downriver area as a whole presents a very difficult time for sellers. Sellers are being asked for an extraordinary amount of concessions in order to sell their houses. So, please keep this in mind when you are presented with an offer on your house. Most offers are coming in asking the seller to contribute 6% of the offer price to be used to fund the purchasers cost to close. On a $100,000 dollar house this amounts to $6,000. Now the buyer on most offers have to fund there own down payment. On an FHA mortgage the minimum down payment would be $3,500. Now, my question is “how much does it cost to originate a mortgage?”. Setting up escrow accounts for taxes is the major cost of funding a mortgage so let’s say this amounts to $3,000. Now there is a 1% origination fee, credit reports, home owners insurance, appraisal fees and surveys. The total of these fees (assuming the $3,000 for property tax escrows is correct) is $5,200. This leaves $800. This $800 could be used to (depending on the lender) buy down the interest rate for the buyer. The question I pose to you as the seller is: Is it worth losing the buyer over $800? If you have questions please ask through this medium or call me at the number provided.

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Home Purchase and Discount Points

Posted by Tom Crowe | on Saturday, August 22nd, 2009 at 10:41 am
Category: Homes.
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At one time there was a mortgage interest rate and that was it. 4,5 6…whatever. Home buyers did not have a choice. Add discount points to this and the answer was always the same…take it or leave it. Today, buyer’s have more choices in how they finance their new home. Often the question is should I pay point’s and buy my interest rate down or should I close at a rate with no points. The answer lies in how long are you going to stay in the house and also do you have the money to buy the rate down.

Let’s say that you are borrowing $100,000 at a rate of 5.5% and the principal and interest amounts to $567.79. If you were to pay 1 discount point ($1,000) and lower the rate to 5.25% the principal and interest payment would be $552.20. A savings of $15.59. The pay back period for this $1,000 investment is 5 years 4.14 months. So if you were planing on staying in the house more than 5 years and 4 months this would appear to be the better thing to do. More on discount points later. If you have any questions on home financing please feel free to respond.

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What It Takes To Get Jobs

Posted by Tom Crowe | on Tuesday, August 18th, 2009 at 3:36 pm
Category: Homes.

I have no data available to back up my perception of the unemployment rate of Downriver homeowners, but I have to think it is in excess of 25%. The figures the government gives us does not consider those who have dropped off the roles and have just stopped looking (extensions taken under consideration). I have heard, and have reported in this blog, that National Steel is calling people back to the steel mill in River Rouge. Something to the tune of 700 people. That makes me wonder; The Allen Park “Unity Studio” is talking about an initial job creation of about 87 with more to come. As reported in last Sunday’s New Herald: “The project has already been scaled back to half of what was originally projected”. At that time they were talking of 3,000 jobs. My question is who is better at creating jobs? government or the private sector? If the Renaissance Zone is approved, we will get absolutely no tax dollars from Unity Studio. Is 87 jobs worth giving up that much? Some say that the dollars spent in the local communities will make up for it and that it is not uncommon for a 2 week project to generate $200,000 to the local communities. My only hope is that there is a lot of 2 week projects.

On another note, the battery plant in Brownstown Twp. is suppose to hire 100 employees. Does anybody stop to think that we have lost well over 400,000 jobs in the last few years. Mostly to exporting our jobs overseas. How do they ever think that creating these small jobs of 100 or less is going to replace what we have given away to support the economies of other countries. I would also like to know what jobs are being created here to supply the demand for goods and services that these now developing countries are requiring.

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Bottoming Out?

Posted by Tom Crowe | on Wednesday, August 5th, 2009 at 4:54 pm
Category: Homes.
Tags: , , , , , , ,

I see hopeful signs about our downriver housing market. First of all, I have been told that about 700 employees have been recalled to National Steel (formerly Great Lakes Steel). Also pending sales are up over June 2009:
Single Family Condominium
June total pending sales: 150 – 143 7
Average list price: $60,701 and $53,343 respectively

Single Family Condominium
July total pending sales: 372 – 353 19

Average list price: $69,307 and $68,540 respectively

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Allen Park Crafts Fair

Posted by Tom Crowe | on Friday, July 31st, 2009 at 2:53 pm
Category: Homes.

Scheduled for August 10 thru 11.

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Allen Park and Downriver Home Appraisals

Posted by Tom Crowe | on Friday, July 24th, 2009 at 8:58 am
Category: Homes.
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Our real estate industry is struggling with many issues, list pricing and appraised value evaluation being my topic today. Never in my 25 years of selling residential real estate have I seen the number of low appraisals that have become the norm for our business. Home owners in Allen Park are seeing the value of their homes diminish more and more each day. One issue that I am currently beginning to research is how seller concessions are treated on an appraisal. Currently, most appraisers are deducting value when a seller concedes to seller concessions toward the purchasers cost to close. In my opinion, this concession does not affect value. It is simply a cost of the sale much like a real estate commission. If this adjustment was not made values increase up to 6%. I’ll let you know what I find out.

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Market Recap

  • Avg. Sales Price: $78,873

  • Avg. Days on Market: 81

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