Murfreesboro Tennessee Real Estate

View the original article HERE.

The recently passed Housing and Economic Recovery Act of 2008 (H.R. 3221), was presented to the public as legislation that would assist homeowners facing foreclosure and make home purchases more accessible to potential home buyers.  How successful the new law is in these areas is highly debatable.  Here are some things you need to know about this legislation:

• Down payment assistance programs, such as AmeriDream and Nehemiah Corporation of America, will go the way of the Dodo on October 1, 2008. What does this mean for the Rutherford County real estate market? 
• If you want to be a buyer and don't have a down payment of at least 3.5%, you really need to get a home purchase under contract before October 1st or start saving your money for a down payment.  There are still a few 100% financing programs still available, but relatively few borrowers qualify for them and purchasing with down payment assistance before October 1st is still your best chance to get into a home with little or nothing down.
• If you've been thinking about selling your home, especially if your listing price will be at $150,000 or below, you need to get your home on the market ASAP.  After October 1st, when the down payment assistance programs go away, we estimate 15-20 percent of potential buyers will be eliminated from the marketplace.  We expect a flurry of activity between now and October 1st as cash-poor buyers scramble to purchase something before the October 1 deadline.
• Only about 400,000 mortgage holders qualify to be helped by the foreclosure relief provisions of the act.  Click here to find out if you are eligible.  Just be aware that this assistance comes with strings attached.  If you qualify, make sure you fully understand what you're getting into before signing up for this program.
• First time home buyers (defined by the law as anyone who has not owned a home in the last three years) get up to $7,500 through what the legislation calls a "tax credit".  However, it is more like an interest-free loan as the money must be paid back to Uncle Sam over the next 15 years.

If you want to buy or sell your home, the Jones Team would love the opportunity to help you.  We sell more real estate than any agent or team in Rutherford County.  We have a proven track record of success and we can get the job done for you!

The Jones Team is always trying to improve our customer's and client's experience and stay ahead of our competitors in regards to outstanding technology, marketing, and cutting edge innovative techniques that allow us to pass on the benefits to you - the buyers and sellers, to whom we owe so much of our continued success.

This week a number of our team members including: Joe Hafner, Rob "Peanut" Janson, Tom Cribbs, and YES John Jones himself are attending the Annual Star Power Conference in Orlando, Florida. Star Power invites the top 1% of Realtors nationwide to attend this prestigious yearly event. This year we are learning alot and sharing with other top real estate agents ways to improve our business. This means not only improving our marketing efforts for our listings and finding ways to better assist our buyers, but also how to negotiate on their behalf better to produce the results our clients have come to expect.

In fact, we've just come back from a negotiating session in which John was on the Star panel. Joe will also be teaching a couple of sessions tommorrow, as he was recently honored as the first "Star" who isn't in a listing or selling position! He plays an important supporting role that the Star Power organization has deemed one of the best in the country. He is also known as the major contributor to this blog.

We'll be bringing back alot of new ideas. Take a look around www.JohnCJones.com next week to see some of the exciting new features we'll be adding to enhance your user experience! Also if you are considering buying or selling a home in the Murfreesboro TN or Rutherford County area give us a call today at 615-867-3020 or email John at John@JohnCJones.com for the absolute best in real estate service. We're FIRED UP about real estate and want you to see the difference the area's only STARS can make!

Gloom and doom.

That is the common perception of the real estate market across the country.  Their perspective colored by extremely bad markets in California, Michigan, Florida, Arizona, and Nevada, the national media has relentlessly led all of us to believe that pretty soon our homes will be worth nothing and everyone will be in foreclosure.

The truth of the matter is that Tennessee in general, and Middle Tennessee in particular, are currently experiencing solid real estate markets.  The problem is that we are comparing the good market of today with the record-setting, best-ever, always-rising market of the past few years. 

It is kind of like comparing Vince Young with Peyton Manning.  Vince is pretty good and probably going to get better.  He led the Titans to the playoffs.  But when you compare him to Peyton, there is no comparison.  Almost any football fan would rather have Peyton Manning leading their team over Vince Young--hands down.  But if you look at Vince without considering Peyton, he looks pretty good.

That's where we're at now in Rutherford County real estate.  Good but not outstanding.

Our county has been down in closed sales about 30% all year.  In our opinion, there are three big factors that have played a role in the decline.  First, when the sub-prime mortgage crisis began to unfold, sub prime loans were basically taken off the table.  That immediately eliminated about 20% of potential buyers from qualifying for a loan.  Before the housing boom began in the mid-2000s, this first 20% wasn't even a part of the market.  The other 10-15% is a combination of lenders over-tightening their mortgage qualifications and potential borrowers opting out of the market while waiting to see how everything shakes out.

We think the Rutherford County real estate market has reached the bottom.  At least one financial analyst agrees with us.  Our available inventory peaked at 10.5 months in January and has been in slow, but steady, decline since, dropping to 8.23 months by the end of May.  Our market remains one of the most affordable in the nation, aided by new FHA guidelines that make mortgage money accessible to more potential buyers and still-historically low interest rates.

Being at the bottom does not mean that prices will start shooting up any time soon.  They may even dip some more as inventory is sold off.  But thankfully the worst is behind us. 

In our current market, the opportunities for buyers remain outstanding.  In the stock market, you make money buying low and selling high.  This market is the perfect storm of high inventory, low prices, motivated sellers, and great interest rates and mortgage terms.  If you need a house, now is the time to buy.  If you've been thinking of owning rental property, now is the time to buy.  If you've always wanted to get in on the ground floor of a great investment, residential property in Rutherford County is the place to put your money right now.  Currently, our team members and our clients are aggressively acquiring real estate in our own portfolios.  We can't say it any stronger than that.  When rates start going up again (The FED held them steady last meeting, but that won't last for long!), this window of opportunity will close quickly.  If you want to get started investing or buy a home to live in, please give us a call (615-867-3020).

If you need to sell and buy, try to look at the whole buy-sell picture instead of viewing it as two separate transactions.  If giving a buyer a good deal on your sale frees you up to get a great deal on your purchase, you are better off in the end. Not to mention living in the house you want instead of waiting out the market in an unsatisfactory home. If you'd like us to provide you some expert analysis of your current situation, please give us a call (615-867-3020).

How about a little more perspective on the great American foreclosure scare?

In the state of Tennessee for the first quarter of 2008, one out of every 216 homes (0.4%) experienced some sort of foreclosure filing and just one out of every 585 homes (0.17%) was actually repossessed by a bank.  Both numbers are below the national average. 

Memphis, which had the 20th highest foreclosure filing rate (one out of every 108 homes - almost one percent) among American cities, accounted for 40 percent of Tennessee's filings even though it only contains 20 percent of the state's homes.  Remove Memphis from the statistics and the rest of Tennessee's foreclosure filing rate drops to 0.35% or one in every 289 homes, which is well below the national average of one in every 194 homes (0.5%).

Similarly, on a national basis, five states--California, Florida, Texas, Ohio, and Michigan--account for 54.2 percent of all foreclosure filings even though they contain just 32 percent of America's homes.  California contained nine of the nation's top 20 metro foreclosure rates.  In those five states one out of every 115 homes (0.87%) was subject to a foreclosure filing while in the remaining 45 states just one of every 288 homes (0.3%) had a filing in the first quarter.

What's the point of all of these stats?  (By the way, here is where we got them.)

Foreclosures represent a true crisis in isolated parts of the country; i.e. the top five foreclosure states listed above.  Even in Tennessee, where foreclosures are low, the statewide numbers are skewed by the heavy activity occurring in Memphis.  And in those places that have been hardest hit, the numbers project to a foreclosure FILING rate (the rate of actual bank repossessions is much lower) of less than 5 percent for the year.  That means that more than 95 percent of homeowners will NOT have a filing against them.  In Tennessee, that rate is well above 98 percent.

Don't let the foreclosure statistics as presented by the national media scare you away from the real estate market.  A high filing rate in California should not keep you from buying or selling your home in Murfreesboro.  That would be as crazy as wearing a parka on a 90-degree Rutherford County day just because the news said the temperature was below freezing somewhere in northern Montana.

(We went to the US Census Bureau to research the total number of homes in the United States, and in the states of Tennessee, California, Florida, Texas, Ohio, and Michigan.)

If you've been watching the news with any regularity, undoubtedly you've heard some frightening news about an out-of-control foreclosure rate sweeping across the country.  The talking heads on TV and radio and the writers for your favorite news magazine or daily paper would have you believe that you are in danger of losing your home.  And even if your home is safe, certainly your neighbor is about to be thrown into the street because the creditors are coming after his.

Don't believe the hype!  There is no doubt that foreclosures are up over previous years and have become a real problem in some locations, but they are not going to destroy the economy or the real estate market (especially here in Middle Tennessee) unless we allow ourselves to be scared into not buying or selling real estate.

Just check out this article to see the kind of tactics the media is using to scare us all silly.  The opening sentence proclaims: "The number of U.S. homes heading toward foreclosure more than doubled in the first quarter from a year earlier."  While that statement may be true, as you'll see in a moment, it paints the situation in the worst possible light with uneccessary hyperbole.

Let's take a closer look at the numbers cited in the article.

In the first quarter of this year, one out of every 194 homes received a foreclosure filing, which was more than double the number of filings in the first quarter last year.  Let's say this another way.  In the first quarter 99.5% of homeowners did NOT receive a foreclosure filing, which was down from about 99.75% in the same period of 2007.

Here's another misleading statement from the article.  "Nearly 157,000 properties were repossessed by lenders nationwide during the quarter..."  If about 650,000 is 0.5% of all homes (based on numbers from the article), that means that a mere 0.12% of homes were actually foreclosed in the first quarter of 2008 or 99.88% of homes were NOT foreclosed.

Here's our point: the media can grab a story and sensationalize it completely out of proportion.  Foreclosures ARE up more than 100%, BUT the rate of foreclosure filings is not as big as some would have you believe.  We are experiencing a record number of foreclosures, but most average Americans are not about to lose their homes.  Right now we are on pace in 2008 for a foreclosure filing rate of 2% with less than one percent of homes actually being repossessed.

Certainly one foreclosure is too many, but clearly there is no reason to buy into the panic the media is trying to sell you.

Their have been some cool new gadgets come up lately that we think will eventually affect how you search for real estate. I'd like to share some of these cool features with you today so you'll be up-to-date on the latest technology available to you (and I'd like to think ahead of the other Murfreesboro area agents). The Jones Team is certainly on the forefront of the Rutherford County Tennessee Real Estate Technology scene and we're always striving to keep it that way.

First up is the great new features available in Google Earth's 4.3 Release. There are numerous new functions in this version. Most notably 3D renderings of entire cityscapes that you can explore from your computer and great lighting tools. Ever wonder how a home will look in the morning opposed to the evening? I'm sure many of us have been concerned with how the sun will affect you sleep. See for yourself with this virtual imaging tool. This is a free service offered by Google at http://earth.google.com. Watch this video from MyTechOpinion (my favorite real estate technology blog) for more info.

Another great new tool by Google is the Street View function in Google Maps. Using this technology you can walk down a street and see a neighborhood right from the comfort of your own home. This is great for weeding out those "To good to be true" listings that look great on paper but not so good in person. This tool will be growing in popularity very quickly. It has only been available for about a month and the cities available are still limited to larger metropolitan areas (there are currently about 40) but we expect this will increase gradually over time to include our area (you can already explore Nashville, TN with this great tool). Here's a video on this new Google maps service.  

http://www.youtube.com/watch?v=91wuBqlny50

Or try it yourself at http://maps.google.com

A recent study by Bizjournals.com has ranked Nashville as one of the Top 20 metropolitan areas for housing affordablity. This, of course, is no surprise to us, but comes as yet another report on the Middle Tennessee area's continued momentum as a national contender in both affordablitity and livablilty. You can read the latest article here.

Purchasing a home can save you money very quickly. FIRST, you'll save on taxes because the interest on your home mortgage is tax deductible. If you rent, your landlord gets the break.

SECOND, you'll save on interest payments while keeping the great tax advantage.

For example if you are paying $900 per month in rent, you are paying a portion of this towards your landlord's property taxes and mortgage loan interest. Your landlord can write this amount off. You derive absolutely no tax break. When you own a home, you now reduce your taxes for the mortgage interest and for your property taxes. Your interest is always the highest during the early years of your loan, so your overall write-off is largest during these early years.

Paying rent is like throwing your money out the car window each month. You pay it out and never see it again. With home ownership you receive loan interest write-off, and gain money over the years from the increased value of your home. Over a ten year period, on an initial purchase price of $100,000, you could gain over $100,000 in tax advantages and appreciation based on an 8% mortgage interest rate and 5% per year increase in home values.

On both the 15 year and 30 year loans, your interest deduction is highest in the first few years of the loan, so your tax deduction is highest then, too. Remember, if you plan to move or refinance after 5 years, you will maximize your tax deductions. Keep in mind that as you pre-pay part of your loan to reduce the interest expense, you also reduce your tax deduction. How long you plan to keep your current mortgage loan can help determine which type of loan, and which payment strategy, is ideal for you.

Forbes has ranked the Nashville metro area the number three best place in the nation to buy foreclosed properties.  Check out the whole article here.

This is actually a good thing for all of Middle Tennessee, including Rutherford County for several reasons.

Forbes says distressed properties are a strong investment here because the real estate market is stable with the average home price rising 3.88% from 2006 to 2007.  Additionally, the foreclosure rate is below one percent (0.86%) meaning the marketplace is not being overrun with foreclosed properties like some other areas of the country.

Also, "only cities on Forbes' best places list, which measures criteria such as quality of life and the local economy (labor and energy costs, the regulatory environment, taxes) to find markets ... where foreclosures aren't symptomatic of local economic ruin, were measured."

This article confirms what we've been saying for a long time: residential real estate in Rutherford County is a strong investment.  If you would like to explore the possibilities of putting your money in real estate, give us a call at 615-867-3020 or visit our foreclosure website at www.MurfreesboroForeclosures.com.