Amazon Reveals the Most Romantic City in America

Cupid must be spending some time in Knoxville, Tenn. At least that is the finding of a new poll by Amazon.com that named Knoxville the most romantic city in the United States, based on sales of romance novels, relationship books, romantic comedy movies, Barry White albums and sexual wellness products since the start of 2012.

Following in the romantic footsteps of Knoxville was Alexandria, Va., which took home top honors over the past two years.  Rounding out the top five most romantic cities were Springfield, Mo.; Orlando, Fla.; and Cincinnati.

The rest of the top 20 included:

o  Vancouver, Wash.
o  Miami
o  Murfreesboro, Tenn.
o  Dayton, Ohio
o  Columbia, S.C.
o  Pittsburgh
o  Clearwater, Fla.
o  St. Louis
o  Erie, Pa.
o  Clarksville, Tenn.
o  Everett, Wash.
o  Gainesville, Fla.
o  Las Vegas
o  Rochester, N.Y.
o  Tallahassee, Fla.

The top mover in this year’s list was Dayton, Ohio, which moved up 10 spots in the past year and Springfield, Mo., which went from being unranked last year to the No. 3 spot on this year’s list. Florida may be the most romantic state, with four cities in the top 20, but Miami took home top honors as the sexiest city in 2012 for the third straight year, thanks to strong sales of sexual wellness products.

Comey & Shepherd Realtors | Cincinnati Real Estate Blog | Cincinnati Real Estate | Comey Blog

Welcome Home Grant

Recently announced, March 1^st 2012 begins this year’s Welcome Home Grant.  A buying program catered toward any purchase meeting 80% of MRD income limits. Thanks to Federal Home Loan Bank, they’ve established a set-aside of Affordable Housing Program funds to help create homeownership.  2012 complete set of rules posted at Federal Home Loan Bank www.fhlbcin.com

o  Grants funds to home buyers purchasing a primary residence
o  $5,000 grant for down payment, closing costs and/or pre-paids
o  Funds are available beginning March 1^st and will remain available until all funds have been reserved
o  Closing must occur before December 31^st
o  This is not just for first time buyers, it’s for any buyer meeting the income requirements
o  5 year deed restriction
o  Borrowers must contribute a minimum of $500 of their own funds, this includes earnest money
o  Conventional and FHA loans permissible in Ohio Kentucky and Indiana
o  Purchase contracts must be dated after January 1, 2012
o  Closing cannot occur until after FHLB approves funds

Income Requirements:  80% of the Mortgage Revenue Bond limits per county

Hamilton, Butler, Clermont, and Warren Counties

1-2 Family Household:  $56,320 annually

3-4 Family Household: $64,768 annually

www.eaglesavings.com

Equal Housing Lender | Member FDIC

Joseph V. Koester | Mortgage Loan Officer
Eagle Savings Bank |  6415 Bridgetown Rd. | Cincinnati, OH  45248
513-233-7182 (office) | 513-233-7183 (fax)
jkoester@eaglesavings.com
Est. 1882

This communication is supplied to you for informational purposes only and should not be relied upon by you. Comey & Shepherd Realtors is NOT a mortgage lender and so you should contact Eagle Savings Bank directly to learn more about its mortgage products and your eligibility for such products.

Comey & Shepherd Realtors | Cincinnati Real Estate Blog | Cincinnati Real Estate | Comey Blog

Friday is the last night for dinner at Mayberry, the tiny restaurant on Vine St., downtown, that Josh Campbell opened in October of 2009.

Campbell (no relation to me, btw) is moving to 1211 Main St., into the building that was the home of The Courtyard Cafe. He hopes to open there by Feb. 8, after doing mostly cosmetic work: painting, new lighting and a general freshening. He also said he’s adding ”super-comfortable” chairs.

“It’s going to be a more refined restaurant than my little hole-in-the-wall,” said Campbell. “This is the restaurant I’ve wanted. This is it for me.” For one thing, it’s bigger, seating 40-50 inside, 15 at the bar and 40 more in the courtyard when the weather is nice. He’ll have a full liquor license for wine, beer and cocktails until 2 a.m. and on Sundays.

The menu will be American classics, as indicated by the small-town homey name of the restaurant, but done with a bit of a spin. Fried chicken, cooked sous-vide, then fried with a corn flake crust, served with truffle honey and grits, for example. Or Kentucky-fried bacon with stout and caramel sauce. There will be house-made beef jerky as a bar snack.

The menu will change several times a year with the seasons and a special tasting menu will switch up monthly. He plans to include plenty of vegetarian and vegan dishes, including a vegan “charcuterie” plate, with mushroom pate and cashew cheese, pickled vegetables, etc.

The bar will offer classic cocktails and 6 taps for beer, including one beer made especially for them. There will be 10 bottles of wine at $20, and pint pours at $4. Lunch will range from $6.99-$12.99, which will include a few small entrees. He’ll keep his big 3/4-pound burgers on the menu, but now has cast-iron grills to cook them. Dinner entrees will stay under $15.

Campbell said he hopes Mayberry will be a regular place for neighborhood residents, a place to build community. “It will be real food that appeals to everybody,” he said. Mayberry will be open 10:30 a.m. Tuesday-Saturday, staying open until 2 a.m. on Friday and Saturday. “We’ll see how it goes during the week,” said Campbell. He’ll serve food on Friday and Saturday until 1 a.m. and 10:30 or 11 during the week. After that, they’ll have a late-night snack menu. Sunday brunch will be 10 a.m.-3 p.m.

Comey & Shepherd Realtors | Cincinnati Real Estate Blog | Cincinnati Real Estate | Comey Blog

1) THE PRICE IS THE SAME, BUT THE COST IS LESS

There is more and more research coming out showing that it makes great financial sense to purchase a home today. Whether it is Rent vs. Buy ratios, income-to-price ratios or income­to-mortgage payment ratios, purchasing a home right now is a bargain compared to historic norms. Now, you should to look at the COST of a home today compared to pre-peak prices.

According to the S&P Case Shiller price index, residential real estate values have returned to 2003 first quarter prices. That, in itself, says something. However, when you factor in mortgage rates, the case for buying a home today becomes even more compelling.

In 2003, 30 year mortgage rates stood at 5.88%. Today, they are 4%. How does that impact the actual COST of a home? On a home purchased for $250,000, here is the diference in monthly cost:

DATE                            LOAN AMOUNT                                 INTEREST RATE                        MONTHLY PAYMENT (P&I)

2003                                    $250,000                                             5.88%                                                $1,478.84

Today                                   $250,000                                            4.00%                                                 $1,193.54

Difference in Mortgage Payment: $285.30

That means you save $285.30 a month, $3,423.60 a year and $102,708 over the life of a 30 year mortgage! You buy the home for the same PRICE but the COST is over $100,000 less.

This is why so many financial advisors are saying that this may be one of the greatest times in history to purchase a home.

2) WILL THE 30 YEAR MORTGAGE DISAPPEAR?

The federal government is reconsidering their involvement in the home mortgage process. They plan to still ‘guarantee’ certain mortgages. However, they appear to be redefining what they consider a ‘qualified purchaser’. They are discussing stricter lending guidelines in four diferent areas:

1. The type of mortgage

2. The minimum down payment

3. The debt ratios of the buyer

4. The FICO score of the purchaser

It appears that there is at least conversation about eliminating the 30 year fixed rate mortgage which has been a staple in this country’s housing industry for some time. Some in government want to duplicate the mortgage process of other countries. In Canada, for example, they don’t even have 30 year fix rate mortgages available. The vast majority of Canadian home loans have a 25 year payout but the interest rate is renegotiated every five years. If rates go down, you will wind up with a lower rate. If rates go up, you end up paying a higher rate. If you want a fixed rate mortgage for 25 years you pay a rate approximately two percentage points higher than the going rate at the time of your closing.

Would the same happen in this country? Housing Wire quoted Janis Bowdler, senior policy analyst at the National Council of La Raza:

“Without some form of Fannie Mae and Freddie Mac, replacements to support these popular loans, many first time borrowers will be shut out.”

“Without that guarantee lenders would not ofer 30-year fixed-rate mortgages, at least not at rates the average person could aford. Yes, some would be available but not for the average family but for those with a large amount of inherited wealth they can put to a large down payment.”

WHY IS THIS IMPORTANT?

You probably want to set your housing expense at the lowest number possible for the longest time possible. This may be the appropriate time to lock-in your long term housing expense as three things seem possible, if not likely, in the future:

• Mortgage rates will increase from current historic lows

• The 30 year fixed rate mortgage may disappear

• Rents will return to historic norms of 3%annual increases

If you want to purchase a home of your own but are waiting to see where prices will go, consider what you could be giving up while you wait.

3)TIPS TO PRESENT A STRONGER MORTGAGE APPLICATION

As underwriting guidelines for lenders become more stringent, we need to re-examine what a good mortgage application looks like. As home buyers begin their search for a home, there are a few items they should be aware of that they can do to help get their loans approved (with the best possible terms), and, at the same time, lessen some of the stress that goes along with the mortgage process.

1. INCOME DOCUMENTS

Most lenders want to see a full month of paystubs and two years’ complete Federal Tax Returns. Assembling them ahead of time and holding on to every paystub you get is a good idea even before you find a home and/or submit your mortgage application because it will save you time later. Moreover, looking at those documents and being prepared to explain any deductions that show up is crucial. Child support, alimony, garnishments, and unreimbursed employee expenses are often crippling factors that, if explained and dealt with upfront, can make your loan approval smoother.

2. ASSET DOCUMENTS

Most lenders will scour your bank accounts for the two months prior to going to

contract. They are looking for large deposits because large deposits can signal a new loan that wouldn’t show up on your credit report yet. What’s a “large deposit”? Typically, any deposit that would represent more than your income can support. If you make $5000 a month, after taxes you likely net $3800 (or $1900 a bi-weekly pay period). Therefore, deposits in excess of that will need to be explained and documented. Sold a motorcycle? Have a paid receipt and motor vehicle documents in place. Received a gift? You will need a Gift Affidavit, proof of the donor’s ability and transfer of the funds. Any and all questions should be discussed with your loan officer.

3. CREDIT SCORE Optimization

Do your best to curtail your use of credit as it relates to your available credit lines. Target

a cap of 30% of usage of available lines to get the best scores. Do NOT cancel credit cards. That will lower your amount of available credit, thereby raising your percentage of usage. That will damage your score. Do NOT shop for a car, explore life insurance, apply for a new credit card or increase the limits on your current cards because the running of your credit by people in other industries will also lower your credit score. Most importantly, don’t do anything that will require having your credit run without first discussing it with a mortgage professional who knows the impact it could have.

4. APPRAISAL CONCERNS

It’s unlikely you will make an offer to purchase without checking out comparable home sales. It’s also likely you received that type of data from the real estate agent you are working with. Make sure your agent prepares the same information for the appraiser. Data about similar sales, similar homes currently on the market and maybe even cost estimates for any repairs or improvements anticipated can preempt future problems with appraised values and conditions. Overall, it is recommended that you hold onto copies of everything financial. Think before allowing your credit to be run and work with an agent and loan officer who can use their experience to put your loan application in its best possible light… as soon as you start thinking about buying a home.

4)REAL ESTATE: GOLDEN OPPORTUNITY OF THIS DECADE

Everyone wants to comment on the current real estate market. They want to talk about how now is not the time to buy a home. Some even argue owning a house has never been a great investment. Most say it will be a long time before real estate again begins to appreciate. It all sounds so familiar to me. It was just a decade ago that many made the same arguments about gold as an investment.

Gold had dropped from over $400 an ounce to $250 an ounce (a 40% decline) from February 1996 to August 1999. People ran from gold as though it was a plague.

Lord William Rees-Mogg, the current Chairman of The Zurich Club, in 1997 said:

“No investment has been so thoroughly exploded as gold; most people think that there will no more be another gold boom than there will be another boom in tulip futures in The Netherlands.”

Two years later in 1999, Don Wolanchuk author of the Wolanchuk Report explained:

“Everybody hates gold. You can’t have a bottom until everybody is out. And everybody is out of the gold sector.”

Everyone knows what happened next. The proclamation of gold’s death was rather premature. Gold rose from $250 an ounce to over $1,400 an ounce in the next twelve years. I see the same situation with real estate today. I am not predicting that real estate will see the same levels of appreciation. I do believe however that the market will rebound strongly.

Those who continued to believe in gold as an investment were rewarded. Those who continue to believe in real estate as a sound investment will also be rewarded.

Here is what Adam Hamilton wrote in October 2000 in an essay titled Is Gold Dead? :

“The road for gold investors has been long and parched in the last five years. They have wandered through a seemingly endless desert, occasionally tempted by what proves to be an illusory mirage. Many have fallen beside the sun-cracked path, their white bones picked clean by buzzards and gleaming in the sun. Nevertheless, a brave contrarian core continues to march forward. They have studied history, currency, gold, investments, economics, and finance. They understand the timeless value of gold, the cyclical nature of the markets, and the vagaries of human psychology. They realize it is darkest before the dawn, and the journey most dificult right before the homestretch is reached.

Gold is in an INCREDIBLE position, and it will have its day. Nothing goes up in price forever, and nothing goes down in price forever. Investments are cyclical. Gold is NOT dead, it is simply biding its time, waiting for its next earth-shattering mega-rally. The spoils that go to the few remaining gold investors when that day inevitably arrives will be fantastic. The stunning victory will quickly blot out the painful memories of the long struggle…”

You could replace the word ‘gold’ with the words ‘real estate’ throughout this essay and it would apply today.

5) IS IT REALLY TIME TO BUY A HOME?

A recent report by JP Morgan explains the reasons why now is a great time to buy a home. Right from the beginning, the paper identifies the greatest challenge in today’s housing market: consumer emotion. They attempt to overcome that emotion with logical explanations. They break it down to the following.

PRICE-TO-INCOME RATIO

One measure of housing values is the ratio of personal income to home prices. The report explains where we are today:

“Since 1966, the median price of an existing single family home in the U.S. has varied between 150% and 251% of personal income per household. However, roughly three¬quarters of the time it has been in a relatively narrow band between 185% and 230%.”

Today the ratio is just 153%, implying that to get back to an average price to income ratio, home prices would have to rise by about 27%.

CURRENT MORTGAGE INTEREST RATES

With current 30 year mortgage rates, housing payments are at historic lows as compared to personal income. With interest rates at about 4%, they explained:

“Assuming the use of a fixed rate mortgage with 20% down, this would make the median mortgage payment on a single family existing home just 6.9% of per household personal income, compared with an average of 14.4% since 1966.”

MONTHLY RENT VS. MONTHLY MORTGAGE PAYMENT

Is it less expensive to own a home or rent a home? The answer to this question helps families make the decision whether or not to buy a home. The report explains:

“…we estimate that the implied median mortgage payment has fallen to just 78% of the median asking rent…”

The paper comes to the conclusion that now is the time to buy.

“The numbers on housing have an important message for American families today, and particularly younger families setting out on life’s great adventure: Five years ago, at the peak of the home-buying euphoria, it was emphatically a time to rent. Today, when home ownership is depreciated more than ever before, the numbers tell us it is a time to buy.”

6) AMERICANS STILL BELIEVE IN THE VALUE OF HOMEOWNERSHIP

Fannie Mae ‘s National Housing Survey questions the American public on a multitude of questions concerning today’s housing market. We like to pull out some of the findings we deem most interesting.

Here are some of the most interesting findings from their most recent report:

MOST IMPORTANT REASONS TO BUY A HOME

The study shows that the four major reasons a person buys a home have nothing to do with money. The top four reasons, in order, are:

• It means having a good place to raise children and provide them with a good education

• You have a physical structure where you and your family feel safe

• It allows you to have more space for your family

• It gives you control of what you do with your living space (renovations and updates)

When we talk about homeownership today, it seems that the financial aspects always jump to the front of the discussion. There is no doubt that families must justify a home purchase from a financial point of view today. However, the reasons they actually buy are the same reasons our parents and grandparents purchased their home – to create a better lifestyle for their families.

THE HOME AS AN INVESTMENT

Though most people purchase a home for non-financial reasons, everyone realizes there is a money component to homeownership. Here is what they said on this issue:

• 64%of the general population (and 69%of homeowners)believe that home ownership is a ‘safe’ investment.

• 55%believe that home ownership has more potential as an investment than any other traditional asset class.

• 68%think that now is a good time to buy a home

RENT VS. BUY

• 63% of renters have aspirations to someday own their own home

• 70% of renters think that owning is superior to renting

• 96% of homeowners see home ownership as a positive experience(4%see it as a negative experience)while 83% of renters see renting as a positive experience (15% see it as a negative experience)

• 97% ofhomeownersliveinasinglefamilyresidencewhile53%of renters live in a multi-unit building

Even in these difficult times, Americans still realize the value of homeownership both from a financial and social standpoint.

1) House Prices: Where they will be in the Spring

Many sellers want to wait until the spring before putting their house on the market. They believe that they will see more potential buyers and as a result, will get a higher price. In the northern part of the country, they might not want people walking through the snow and then into their house.

In a normal real estate market, this may make sense. However, this market has been anything but normal. This spring will also see some abnormalities. The biggest difference will be the direction prices will take.

In years past, the spring market would favor the seller because increased demand would outpace any increase in supply: the number of houses coming onto the market would not be as great as the number of buyers newly entering the market. In most situations, when demand is greater than supply, prices increase.

The reason this spring will be different is that the supply of homes coming to the market will be dramatically impacted by foreclosure properties being released by the banks. Many believe this increase in inventory will far outweigh buyer demand. In situations where supply is greater than demand, prices decrease.

Will This Actually Happen?

RealtyTrac, a firm that monitors foreclosure activity, explained:

“U.S. foreclosure activity has been mired down since October of 2010, when the robo-signing controversy sparked a flurry of investigations into lender foreclosure procedures and paper work. While foreclosure activity has registered well below levels from a year ago, there is evidence that this temporary downward trend is about to change direction, with foreclosure activity slowly beginning to ramp back up.”

This will impact prices.

What do experts believe the impact will be?

Here are the pricing projections by several major entities:

• Zillow believes we will not see a bottom in prices until the end of the first quarter of 2012.

• Standard & Poors thinks prices will drop 5% in the next few months.

• JP Morgan Chase believes prices will depreciate 6 to 7% over the next six months.

• Barclay’s says prices will fall 7% by the end of the first quarter of 2012.

Waiting until the spring may not make sense this year.

2) Understanding the impact of shadow inventory

Standard & Poors is a company that studies shadow inventory and its impact on the housing market.

What is Shadow Inventory?

It is an inventory of houses that will come to market as distressed properties at a discounted price. Each of the data companies define shadow inventory in slightly diferent ways.

Standard & Poors defines it this way:

“We include in the shadow inventory all outstanding properties for which borrowers are 90 days or more delinquent on their mortgage payments, properties in foreclosure, and properties that are real estate owned (REO)”… Our calculation of the months to clear the shadow inventory is the ratio of the total volume of distressed loans to the six-month moving average of liquidations.”

Is this inventory increasing?

Their most recent report shows that shadow inventory is decreasing in many parts of the country as banks are starting to release distressed properties to the market.

From the report:

“We estimate that it will take 45 months to clear the national shadow inventory. This is seven months below our peak estimate but three months longer than our estimate a year ago. Twelve of the top 20 MSA’s recorded declines in months-to-clear during the quarter, while eight reported increases.”

What impact will shadow inventory have on real estate?

One of two things will happen:

1. The inventory will continue to mount and be a hindrance to a housing recovery.

2. The inventory will be placed on the market and impact prices.

As the report states:

“Despite the recent stability of our months-to-clear estimates and liquidation rates, these distressed loans continue to loom over the housing market and threaten to further depress home prices. Though fewer additional loans are currently defaulting, the overall volume of distressed loans remains huge. Low liquidation rates over the past two years allowed the shadow inventory to grow as distressed homes have remained tied up in foreclosure proceedings.

The shadow inventory will continue to jeopardize the housing market’s recovery until servicers are able to improve liquidation times. However, if and when that happens, an influx of homes will likely enter the market, increasing supply and driving prices down further.”

It is very likey this inventory will come to market, impacting prices now, but bringing about a housing recovery in a much shorter period of time.

3) Things to consider before renting a house you can’t sell

In this dificult housing market, more and more homeowners are considering renting their house instead of adjusting the price. We strongly believe that residential real estate is a great investment and therefore, can understand this thinking. However, if you have no desire to actually become an educated investor in this sector, you may be headed for more trouble than you were looking for.

Before renting your house, you should take the following steps to make sure this is the right course of action for you and your family.

Set up an appointment with an eviction attorney

People rent out their houses assuming that every tenant will pay the rent every month. You must realize, because of the current economy, there are millions of people not paying their mortgage. There is a chance you may rent to someone who at some point can’t (or simply won’t) pay you the rent. Understand what the legal challenges of eviction could potentially be before deciding to rent your house.

Interview property managers

If you are not a full-time investor, hire a professional to handle the property. You need someone to find a qualified tenant, collect the rent and manage the problems. You don’t want to have to make collection calls. What would you say if a tenant told you that they had enough money to either buy food for their children or pay you your rent, but not both? You need a person experienced with these situations to help.

You also don’t want to receive calls at all hours of the day and night regarding maintenance issues or challenges a neighbor may be creating for your tenant.

Create an honest budget

Sure, you will receive revenue in the form of rent. However, don’t forget you will also have expenses. Some of the expenses you should consider:

• Mortgage Payment (unless there is no mortgage on the house you will rent out)

• Property Taxes

• Maintenance Expenses such as repairing or replacing: roof, heating/air conditioning unit, appliances, etc.

• Insurance – Check with your insurance company who may suggest or demand that you increase your liability coverage.

Again, renting residential real estate historically is a great investment. However, it is not without its challenges. Make sure you have decided that you want to rent the house because you want to be an investor, not because it looks like an easier way out than selling the house.

4) Short Sales: A dignified solution for many families

We are truly excited that the banks are beginning to see that a short sale in many cases is a good alternative to foreclosing on a property. It makes more sense to sell the property at a higher price. At the same time, the banks are creating less vacant Real Estate Owned (foreclosures owned by banks) which have blighted neighborhoods and negatively impacted surrounding house values for the last several years.

It is also satisfying that so many of our fellow real estate professionals are taking the time to get properly trained to facilitate these transactions to a successful closing. We don’t want to speak to the financial aspects of the surge in short sales. Instead, we want to address the impact it has on the families living in these homes. They have found themselves in over their heads. In many cases, they can’t afford the mortgage and are trapped – unable to sell because the mortgage exceeds the home’s value. They may believe that they are left with only one alternative – allow the home to proceed to foreclosure.

Let’s realize the consequences of this decision for the family. The day will come that someone in an official capacity knocks on the door and notifies the family it is being evicted immediately. No matter how well they have prepared, at that moment, spouses look to each other in embarrassment. There is a big difference between imagining how this moment might feel and actually experiencing it.

And, in so many cases, there are children involved. The official stands there as a mother or father gets on a knee and explains to their son or daughter that they must go pack up some of their toys and belongings in a hurry because the family must leave – now!

The short sale process avoids these situations. The family plans around a set closing date. The children are made aware of the move months in advance and the parents have time to lessen the pain of that move.

Short sales make good financial sense for all involved. They also allow families to exit an extremely difficult situation – WITH DIGNITY.

5) Great Reasons to sell your house today

You may be asking yourself, “Is it time to sell my house?” The answer to that question is based on what your families’ goals are. If you don’t need or want to move for a few years it might make sense to wait for the housing industry to recover and prices to appreciate. However, if you wish to move within the next six to eighteen months, it is probably better to sell sooner rather than later. Here are some reasons why:

Distressed properties will impact prices

Distressed properties (foreclosures and short sales) on the market will increase this winter and spring. This will put tremendous downward pressure on prices for at least the next 12-18 months. Get your house sold before they become your competition.

Mortgages will become more difficult to attain

Lending standards are continuing to tighten. There is legislation currently being considered that will make it even harder for buyers to qualify. Less demand will equate to lower prices.

It is the perfect time to move-up

With prices where they are and interest rates at all time lows, there may have never been a better time to move-up into your dream home. If you move into a more desirable home now, you will be in position to gain larger equity as prices eventually appreciate.

You get to move on with your life

Probably the most important reason to sell is so you can get on with your life. Do not allow a less-than-stellar housing market to prevent you from reaching your goals as an individual or as a family. Think about the reasons you are thinking about moving. Are these reasons really important to you? If you have to take less than you were originally hoping to get for your house, your family has a question to ask each other: Is the dollar difference in sales price worth putting off our plans? Only you and your family know the answer to that question.

Comey & Shepherd Realtors | Cincinnati Real Estate Blog | Cincinnati Real Estate | Comey Blog

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FHA Loans are assumable…good now and good later!!

One of the rarely touted advantages of people taking FHA mortgages today is the fact that they are assumable. What that means is, when the FHA homebuyer of today is looking to sell his home, a qualified purchaser can “take over” their loan.

Most people believe that interest rates will return to a “normal” range (between 6.5% and 7%) in a couple of years. When you assume a mortgage, the terms remain the same. This means that a buyer five years from now can enjoy a 4–4.5% mortgage by assumption rather than the 6.5–7% mortgage they would get without it. Since most people buy homes based on how the monthly payment fits into their personal monthly budget, this is extremely impactful.

As an example, a $300,000 loan at 4% today carries with it a $1,432.24 principal and interest payment on a 30 year fixed mortgage. If offered for sale in five years, the purchaser could assume the $271,858.56 balance with the same $1,432.25 payment and remaining term of 25 years. The total payments over the 25 years would be $429,675.

Compare that to a new $272,000 loan at 6.5% for 25 years, which would carry a monthly payment of $1,836.56 (over $400 more per month than the assumption and more than $120,000 more over the 25 year term).

At 6.5% for 25 years, to wind up with the same payment as the assumed mortgage, our borrowers would only be getting $212,000 — $60,000 LESS!

The point here is that, when rates go up, homes with assumable mortgages will have more value and will sell at higher prices because they are more affordable. As an additional bonus, the closing costs on assumable mortgages are significantly less.

The borrowers must be credit-worthy, of course (have good credit, qualifying income, and necessary assets to close), but they would have to be credit-worthy to get a new mortgage too!

Besides the multiple other reasons to obtain an FHA mortgage (low down payment requirements, extended income ratios, lower credit scores, and easier sourcing of funds), there is another perk. In the future, there is a good chance that you may be able to sell your home for more money because of the FHA loan’s assumability.

Comey & Shepherd Realtors | Cincinnati Real Estate Blog | Cincinnati Real Estate | Comey Blog

Who would have figured, 10 or 20 years ago, that downtown Cincinnati would ever be described as “interesting” or “appealing”? A more oft-repeated characterization was that “they roll up the sidewalks at 6,” once the workday crowd headed off. 

But local hotel and tourism officials are much more cheerful these days, according to our Insight focus on travel and hospitality this week. Senior Reporter Dan Monk writes that hotel occupancy in the central business district has jumped more than 20 percent since its low point in 2001, and convention business is booming.

And that’s because downtown Cincinnati isn’t what it used to be, in a good sort of way.

“There’s just more going on here,” says Wayne Bodington, general manager of the Westin Hotel, in Monk’s column.

But while tourists seem to think that downtown Cincinnati is pretty lively, quite a few residents of Greater Cincinnati still cling to the notion that downtown is a dark and forbidding place, with empty streets, boarded-up buildings and flying bullets.

While the “empty streets” part once was true, at least in the evenings, downtown never was the desolate place some suburbanites envision; the number of Fortune 500 headquarters has always kept things humming, at least during the day.

And the business about high crime is illusionary – downtown has had exactly zero homicides in the past year, according to Cincinnati Police statistics. More likely people confuse downtown with the more crime-ridden neighborhoods of Over-the-Rhine and the West End, but even there, crime is decreasing.

In fact, according to the police department’s District One statistics, which include all three neighborhoods, violent crime is down 15 percent over the past two years, and property crimes have fallen 9 percent.

Cincinnati’s government is an ongoing magnet for insults, but the city deserves credit for what it’s done for downtown in the past 20 years. It kicked off the downtown living trend in the early 1990s, when it subsidized Towne Properties ’ apartment projects on Garfield Place. And the formation of the public/private Cincinnati Center City Development Corp. (3CDC) speeded up the downtown living process, turned Fountain Square into an entertainment and restaurant venue, and began gentrifying large chunks of Over-the-Rhine.

Now, in the evenings, you can see people walking their dogs, crowding into bars and dancing to music on Fountain Square. That is, if you dare to come downtown.

It is the fate of Greater Cincinnati, and every sprawling American urban area, that some people live so far out in the suburbs that the city is nothing more to them than a mailing address.

And grumbling is part of Cincinnati’s culture, but why trash the city you call home, especially if you haven’t seen the center of it since the fountain was in the middle of Fifth Street and your mother took you Christmas shopping at Mabley & Carew and Pogue’s department stores?

Cincinnati will be hosting the World Choir Games this summer, bringing thousands of people into downtown and its environs. That would be a perfect time for entrenched suburbanites to make the day trip and see what Mr. Bodington is talking about, as well as participating in the festivities.

Or come down now, while you can ice skate on Fountain Square, and see what a difference a couple of decades can make.

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