It was long time coming, but season has finally arrived.    The July 4^th weekend was crazy in Highlands and Cashiers – it seemed as if there were more visitors here than ever before.   The Town of Highlands put on spectacular fireworks show lighting up the night sky while the local radio station played continuous patriotic music.     Everyone cheered when the finale ended a busy day of activities.

 We have all been on the go showing property and have had some offers from buyers and a few that went to contract.    It is still very difficult to get buyers off the fence – they are understandably nervous that the US economy will dip again.

 As the mercury rises, most of us on the Highlands Plateau would prefer to hear the word “dip” only in relation to swimming pools, lakes or streams.  Unfortunately, the doom-sayers have hijacked this word and incorporated it into their latest dark scenario: a double-dip recession.     There’s no question that chatter about a double-dip has intensified.   A search of Google News turned up nearly 6,000 stories about a double-dip recession in the first week of July.  That compares with 120 such stories for all of July 2009.  

 There is still plenty of evidence however, that the double-dippers don’t have all the cards.  In the past week, jobless claims dropped, retailers said June wasn’t as bad as feared and the Dow Jones Industrial Average managed to rebound decisively back above 10000.      In a double-dip recession, the economy falls back into negative territory not long after emerging from recession.  Growth in gross domestic product turned positive in the third quarter last year and has remained so ever since.   Later this month, second-quarter growth estimates should show that the string of positive quarters is continuing.

The Federal Reserve has some moves they can take to support the economy if threatened by a renewed downturn.    ”We still have tools. Obviously we have more room on the tightening side than we do on the easing side,” said Federal Reserve Board Governor Elizabeth Duke on Monday in an interview on Fox Business Channel.  “But we still have balance sheet tools and we could still bring interest rates down just a bit,” Duke said. At the moment, it doesn’t look like a double-dip recession is likely, Duke said. “It is a moderate recovery even though some of the recent data has come in pretty soft,” she said. Economists said the Fed could lower the interest rate paid on excess reserves to zero from 0.25%.    Overall, we’re more likely to see modestly slower growth than we’ve recently experienced. But the only double-dips in sight involve ice-cream cones, nachos or a return to the water.

Foreclosures and short sales are still a minor factor here.  There are 29 properties in foreclosure in the Highlands market – 14 homes, 9 condominiums and 6 home sites.   Eight of the 9 condominiums are the Town Place units by the ballfield in town.   In the Cashiers/Glenville/Sapphire market there are 79 properties in foreclosure/short sale including 34 homes, 9 condominiums and 36 homesites.    

There have been 28 sales so far in Highlands this year – this compares to 37  in the same first six months of 2009.     In the                  Cashiers/Glenville/Sapphire market there have been 41 sales so far compared to 27 in 2009.     There have been 12 land sales in Highlands so far this year with an average sales price of $189,587.   There have been 44 sales in Cashiers/Glenville/Sapphire with an average sales price of $119,855.  There are currently 259 home sites on the market in Highlands and 986on the market in Cashiers/Glenville/Sapphire.

There have only been 2 condo sales in Highlands so far this year and 6 in the Cashiers/ Glenville/Sapphire community.   There are currently 83 active condo listings in Highlands and 112 in Cashiers/Glenville/Sapphire.

The inventory of available properties has increased again.    There are currently 497 homes on the market in Highlands and 719 in the market in the  Cashiers/Glenville/Sapphire area.

There will never be a better time to buy a place in the mountains.   Inventories are up, so you have the best selection; many Sellers are anxious to move on or move up, so they are more likely to make you the best deal; interest rates are at historic lows, so you can afford more house.    Let the professionals at Meadows Mountain Realty help you find the best buy possible in the best place in the world to live – the place we call home.   Call today at 866-526-3558 or email us at info@meadowsmtnrealty.com.

In these uncertain economic times, many Americans are living from paycheck to paycheck, often extending themselves even further through credit card debt.     For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings.   One option is a real estate short sale.   

 To help understand how a short sale differs from a foreclosure, it may be helpful to point out that short sales can also be referred to as “pre-foreclosure sales” which, as the name implies, precedes the home being officially repossessed or foreclosed on by the lender.

When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due.    Banks grant short sales for two reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.    It might seem counterintuitive for a lender to go along with a short sale. After all, a lender is legally entitled to pursue the full balance of the loan.   Foreclosure is an expensive and time-consuming process for a lender.  By agreeing to a short sale, the lender wraps up this little mess quickly, and perhaps with less of a loss than it would have incurred with a foreclosure.

Remember, after foreclosing, the lender owns the home and has to maintain it, insure it and pay taxes on it.  So instead of receiving payments each month, the lender is now forking out money every month.   Plus, short sales help the lender look good on paper — the property never gets listed as an actual foreclosure, which helps the lender’s numbers look better to bank regulators.  They see it as the lesser of two evils — if the numbers make sense for them.

 It should be noted that there are still negative implications for sellers in a short sale, even if less damaging than those associated with foreclosures and/or bankruptcy.  For example, a short sale homeowner’s credit will still be adversely affected by settling with the lender.   However, short sales do carry less negative effects than foreclosures.   Short sale sellers are widely seen as less risky than foreclosed sellers.   Case in point, Fannie Mae recently adjusted their guidelines to dictate only a two year waiting period for a short sale seller to buy another primary residence, while they extended the waiting period for foreclosures to five years.

Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the IRS could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid.   I suggest that all borrowers obtain legal advice from a competent real estate attorney and call their accountant to discuss short sale tax ramifications.  

At its best, a short sale can be a win-win for both parties. For the seller, a short sale provides the opportunity to avoid foreclosure and the dreaded implications that a foreclosure brings, in addition to being able to return to home ownership sooner.  For the lender, a short sale attains most of the value of the loan sooner, and avoids incurring additional legal or carrying costs while the foreclosure process plays out, which can sometimes even take years.  

And, frankly, short sales are great options for savvy buyers.   The short sale process is still a mystery to many people, even after all these years.  Lots of buyer’s agents are confused; puzzled buyers are looking for direction, and not every short sale listing agent knows how to do a short sale.     Two of our agents at Meadows Mountain Realty are experts in short sales.  Tammy Mobley received the coveted Certified Distressed Property Expert (CDPE) Designation in 2009 and Tom Goldacker completed the Short Sale and Foreclosure Course earlier this year to receive his SFR Designation.   

If you are considering buying or selling a home in a short sale situation, call the experts at Meadows Mountain Realty at 828-526-1717 or stop by our office at 450 N. 4^th Street in Highlands.   We can also be reached by email at info@meadowsmtnrealty.com.

Many consumers comment that some realtors as well as some economists seem confused about the future of housing sales. They point out that sometimes we seem bullish and sometimes we seem bearish. Let’s set the record straight about this.

Whether the Highlands housing market is likely to be up or down in the future is based on how many people decide to buy homes. Their decisions are based on a myriad of personal factors such as health concerns, whether they are close to retirement, whether they need or want a second home, whether they can afford to buy and so on.

Their views are also affected by tax credits, home prices, mortgage rates and a host of other factors out of their control. In short there are more than a few variables.

What do we think? Going back over 30 years shows that one consistent barometer is the “5%” rule. That is over 30 years of data shows that roughly 5% of all households tend to buy a new or existing home each year. (Note: in 2005 the percentage had reached 7.2% or 44% ABOVE the sustainable long term rate.) On that basis, and given approximately 120 million households in the U.S. then “normal” housing sales should be around 6 million for this year. And given where we are at the start of June, that seems to be where we will finish.

 In short, we are bullish about a solid if not spectacular year for housing sales.

There’s also been some confusion about how the new health care bill may affect real estate. First, there is no 4% “sales tax” or “transfer tax” on the sale of a home included in the health care bill. Additionally, there is nothing in the bill that impacts the mortgage interest deduction. What was included in the health bill is a provision that imposes a new 3.8% Medicare tax for some high income households that have “net investment income”. Any revenue collected by the tax is dedicated to the Medicare hospital insurance program.

This new tax would only apply to households with Adjusted Gross Income (AGI) of more than $200,000 for individuals or more than $250,000 for married couples. Since capital gains are included in the definition of net investment income, an additional tax obligation might result from the sale of real property.

The calculations of how much tax is owed are complex. However, even when the AGI limits are met, the new tax would not be applied to all capital gains that result from the sale of a home since the existing home sale capital gains exclusion rule still applies. So if the gain from the sale of the primary residence is below $250,000 (individual)/$500,000 (couple) then no Medicare tax will have to be paid on the gain.  The new Medicare tax would only apply to any home sale gain realized in excess of the $250K/$500K existing primary home exclusion that pushes the filer’s AGI over the $200K/$250K income limits. The new Medicare tax will take effect January 1, 2013. Of course, you need to check with your own tax professional to see how the new health care reform bill can affect your bottom line.

For more information on real estate in Highlands, contact Judy Michaud at Meadows Mountain Realty 828-526-1717 or toll free 866-526-3558. Please feel free to stop by our office across the street from “Sweet Treats” at 450 N. 4th Street in Highlands or at 94-1 Highway 64 West in Cashiers.  Or visit us online at www.meadowsmtnrealty.com   Judy can also be reached by email at info@meadowsmtnrealty.com

This question is central to both anxious home buyers and investors who are on the fence waiting for an economic recovery.   Even with historically low rates and with the first-time buyer tax credit  which the government hoped would inspire buyers to take the plunge — the number of new home purchase loans is expected to fall 4.6% this year, according to the Mortgage Bankers Association, a trade industry group.

Banks are still caught in the undertow of the mortgage crisis, and are under pressure from bank regulators to clean up the earlier mess and under pressure from stock holders to boost profits.    This pressure is increased by the government’s attempts to stem the growth of foreclosures and bring about recovery from the Great Recession.   For a list of foreclosures and short sales in Highlands and Cashiers NC click here.

You would think that healthier banks would be lending more.    However, consumers aren’t seeing increased mortgage lending because of tight underwriting standards associated with Fannie Mae, Freddie Mac and the Federal Housing Administration.   The banks are not really in direct control of the underwriting standards of residential mortgages.   These firmer lending standards seem to be a return to what it was like to get a mortgage before the housing bubble.  If you couldn’t get a mortgage in 2000, you probably won’t get one now.

For lending to increase, some experts say the government will have to play a role in softening the standards – at least slightly – of getting a mortgage through Fannie and Freddie, which typically require a minimum 20% down payment.   This requirement is one reason why FHA originations – which require a 3.5% down payment – have gone from 2% of the mortgage origination marketplace in 2006 to 35% in the present market.

There is a bright spot which helps the Highlands and Cashiers market.   That is a mild loosening of jumbo-mortgage lending relative to price.     The jumbo mortgages have a couple of advantages for lenders.   The banks are allowed to set the standards for the loans, and the loans can go on their books.    The most immediate link between a financially healthier bank and increased lending will likely be seen with these mortgages since banks have full underwriting control over them.

It is expected that moving forward, mortgage lending will remain a significant portion of the large banks’ business; the Mortgage Bankers Association expects new mortgage originations to climb 14% in 2011 up almost 10% from this year.

For questions about real estate in Highlands and Cashiers NC, ask the experts at Meadows Mountain Realty, your best source for up to the minute information about your best investment.

After the structural framing stage and the installation of the preliminary — or “rough” — plumbing, electrical, and heating and cooling components are complete, there is a no-name phase of construction we’ll call the “prefinishes.”

The reason this stage of the process has no common name is because several different activities — by several different trades — occur during this time. All of them combine to prepare the house for the finish products to come, from flooring to trim to lighting, and are vital in the overall performance of the house. Indeed, the sum of these prefinishes is called the “thermal envelope.” These critical steps include:

Housewrap. Also called an air or vapor barrier, this tough, woven sheet-like material is installed on the exterior walls around the entire house. Sections are fastened and taped together to keep water and air outside the structural frame. Housewrap protects the “thermal envelope,” improving the home’s energy efficiency and indoor comfort. The wrap covers the rough openings of the windows and doors. Once it is installed, we carefully cut out those openings and fold the material around the rough openings to ensure complete protection from the elements.

Windows and doors. Once the housewrap has been cut to expose the rough frame openings, we carefully install each window and door. Attention to detail is critical at this stage to make sure that the windows and doors not only operate smoothly and properly, but also deliver maximum thermal benefits. Good quality windows and glass patio doors are now designed for improved control of thermal transfer, solar heat gain, and harmful ultraviolet rays.

A home’s main entry door is often a signature feature of the house. Depending on the home’s design, the entry door might include windows on one or both sides (sidelights) or over the top of the door (transom), or perhaps even a glass insert in the door itself. These design elements add character to a home’s design and heighten curb appeal.

After the drywall is hung, we install the garage door(s). Like windows and passage doors, garage doors have come a long way in their design options and insulating value.

Insulation. Insulation is typically installed in the exposed framing cavities of the exterior walls. Good quality insulation retards the transfer of warm and cold air through the home’s structure. Insulation makes the home more energy efficient and comfortable inside.

Different insulation products are sometimes used for different sections of the house. In the walls, for instance, formed batts of fiberglass insulation are designed to fit snugly between the studs. In the attic, a loose-fill (or “blown”) insulation is often more appropriate to pack the spaces between the roof framing. An expanding, spray-applied foam might be most appropriate in the slight gaps between the window and door frames and their rough openings to seal the house more completely against air infiltration and thermal transfer.

Drywall. The last of the “prefinishes” is drywall, or gypsum wallboard panels. These familiar panels are cut to fit and fastened to the framed walls and ceiling, creating a smooth surface and substrate for paint, paneling, wallpaper, and other finishes. (The floors have a wood substrate called “subflooring,” which is installed during the framing stage of construction.)

Because whole and cut sections of drywall panels are pieced together, the seams between the sections must be filled and smoothed before the wall or ceiling finishes are applied. Taping the drywall joints is a process that requires several days, as multiple layers of “mud” are applied and sanded to deliver a smooth and uninterrupted substrate with no visible joints between the panels.

The completion of the “prefinish” stage creates the home’s thermal envelope, fully protecting it and its occupants from the elements and from thermal transfer through the exterior walls and openings.

One of the best builders in the area is Zac Koenig of Koenig Homebuilders.   Zac contributed this article to our blog and can be reached at 828-526-4953.   We have a complete list of preferred builders on our website.

Please give us a call if you would like assistance in finding the perfect spot on The Highlands Plateau for building your second home, weekend retreat or a place to live year round.  There is a great selection of homesites available now at good prices.  Call Meadows Mountain Realty at 866-526-3558.

Closing costs are simply the fees associated with          

1) purchasing a home,

2) borrowing money, and

3) preparing paperwork to finalize the sale.

Your total closing costs will vary depending on where your new home is located, what type of property you are buying, the price of your home and the complexity of the transaction.

It is extremely important that you work closely with your buyer’s representative in the early stages of your home search to estimate what these costs could be, since closing costs can easily represent thousands of dollars.  The main categories are:

Discount points to buy down the mortgage
If you want to reduce the ongoing cost of your mortgage over the life of the loan, you’ll want to consider this optional fee. Amounts can vary significantly, from 0.5 to 3 points on the total mortgage amount. This is a one-time charge that is fully deductible as mortgage interest.

Costs for originating the mortgage
This generally includes a variety of fees such as the loan origination fee, the appraisal fee and the cost of credit reports. Other related closing fees may include hazard and mortgage insurance, and interest accrued on the mortgage between closing date and the end of the month.

Taxes and other local fees
Charges will vary according to local government requirements.  Generally, property taxes will be pro-rated according to the closing date.   Tax bills for the current year do not come out until late July or early August, are due when assessed, but not past due until January 1st of the following year.    If your closing takes place before tax bills and the tax assessment for the current year has not been determined, then the attorneys will prorate the taxes based on the previous year amount.   You may also be required to pay personal property taxes, homeowner’s association dues, and other assessments that are specific to the area where you are buying.

Documentation costs
In North Carolina, closings are handled by an attorney, not a title company.  As a buyer, you will have to pay for any research involving public records and title history for your new property.  This insures that the title is unencumbered by other ownership claims or liens and can be delivered to you at closing. It is the responsibility of the buyer to pay for the title examine, opinion of title and the title insurance plus the preparation of their own HUD Settlement Statement.   The attorney fees and other costs include recording and transfer fees, which cover legally recording the deed to your name.    The seller pays for the preparation of the deed, the revenue stamps on the deed, and their own HUD Settlement Statement. 

For questions on closings and closing costs, please contact Nadine Paradise at Meadows Mountain Realty.  Nadine can be reached at 866-526-3558 or via email at nadineparadise@nctv.com.   Nadine has years of experience in working with clients who are buying real estate in Highlands, Cashiers, Glenville and Sapphire North Carolina.   She can help you find your perfect home in the mountains of western NC.

The great thing about a new house is that everything is, well, new. Nothing is scratched, stained, or worn out. It’s wonderful: Everything works! That’s one of the main attractions of buying a new home.

But, as any homeowner knows, the rigors of day-to-day living can cause that blissful new-home feeling to fade. It’s an inevitable process, but one that can be stemmed or slowed with proper maintenance of key systems and finishes.

Once an owner takes the keys to their new home, they become responsible for maintenance of the entire structure and all its systems. Typically, professional builders will ease that transition with a warranty, but ultimately the baton is passed to the homeowners to protect their investment, enjoy the comforts, and maintain (or increase) the value of their new home.

The thought of staying on top of everything in a home can seem daunting, but really, it comes down to common sense, some diligence, and a short list of critical products and systems, including:

Heating and cooling. It’s a simple thing everyone has heard before. Changing the furnace filter every three months goes a long way toward maintaining the proper operation of a home’s entire air distribution system. A clean filter keeps dust, moisture, and other allergens out of the ductwork to help ensure fresh and healthy indoor air. Clean filters and ducts also put an easier load on the furnace, prolonging its life, and allow it to use less energy. Beyond that, homeowners may choose to have the ducts professionally cleaned every few years.

The effort and consistency you put into maintaining your home will pay dividends for you and your family in the future. Following these basic maintenance tasks are key components in retaining your homes new look and feel, while protecting the value of your investment.

These days it’s easier to make a low-ball offer than it used to be, but with short sale properties, foreclosures and overall prices at historic lows it’s important to be offer smart.  Here are some things that a potential buyer should consider when making such an offer:

1. Use foreclosures as comps carefully. Look realistically at the prices of foreclosures if any, in the neighborhood brought. Foreclosures aren’t good comps if the lien holder removed some valuable components of the home like appliances. Don’t forget to look at other closed sales in that neighborhood that are not foreclosures.

2. Examine details of short sales critically. How many liens were there against low-selling short sales? If there were no secondary liens, the lender had considerable flexibility. Your agent should be researching all Deeds of Trust and discussing with you the amount financed on the property.

3. Establish realistic time frames. Even in the best of circumstances, foreclosure takes a long time. Will the seller/bank play the waiting game? How long have houses whose owners have equity stayed on the market? Is the buyer in a hurry? Again, your agent has access to the days on market for listed properties and can usually get some information about the seller to indicate what their situation may be.

If you make a low-ball offer, the bank probably won’t be in any rush to take it. They’ll likely just keep soliciting offers without coming back with a counter.  Ultimately, the property is likely to sell for a higher price and, chances are, you and your agent won’t know it until the deal is done.

We have been fortunate to have a very low number of foreclosures and short sales in the Highlands and Cashiers area.    Prices have held up fairly well, even though the number of transactions are down.  For complete information on Market Conditions in Highlands or Cashiers NC, please contact Michelle Muraco anytime at 866-526-3558 or by email at michaud@hcgexpress.net.

Bank of America has cut interest rates on jumbo mortgage loans in the hopes of expanding its share of what the bank sees as an underserved market for loans too big for purchase or guarantee by Fannie Mae and Freddie Mac.

Not everybody will qualify for the 30-year, fixed-rate loans of up to $3 million that Bank of America has been offering at reduced rates since January, with interest rates currently in the high 5 percent range.

In order to qualify, borrowers will need strong credit (a 720 FICO score or above), down payments of 20 percent or more, documented income, full appraisals, and assets sufficient to cover six months of payments.    But Bank of America thinks its fixed-rate jumbo loans will prove to be attractive to qualifying borrowers, because many competitors will be hard-pressed to match its rates.

Jumbo loans have become more expensive and harder to come by since September 2007, when rising delinquencies gave investors who fund most home loans through the purchases of mortgage-backed securities cold feet about “private label” securities that don’t carry the backing of Fannie and Freddie.

Bank of America and Countrywide Financial Corp., which it acquired last year, funded $16.12 billion in jumbo loans in 2008. Although jumbo loan funding dropped to just $2.4 billion in the fourth quarter, Bank of America is already seeing “very nice volume” since introducing its more aggressive pricing.

Bank of America will only offer the loans directly to consumers — and not through independent mortgage brokers — through retail bank branches and Countrywide Home Loans (which will be re-branded Bank of America Home Loans on April 22).  

The loans are aimed not only at homebuyers, but homeowners with adjustable rate mortgage (ARM) jumbo loans who are looking to refinance at better rates. For both purchases and refinancing, the loan-to-value ratio can’t exceed 80 percent on loans up to $1.5 million, or 70 percent on loans up to $3 million.

After the secondary market for jumbo loans seized up in 2007, lawmakers raised the loan limits for Fannie, Freddie and FHA loan guarantee programs. For most of 2008, the $417,000 conforming loan limit was allowed to stretch to 125 percent of the median home price in high-cost markets, with a ceiling of $729,750.

Assuming that the jumbo loan market would be on its way to a recovery by now, Congress mandated the limits would step back down to 115 percent of median home price on Jan. 1, with a ceiling of $625,500.

The $787 billion economic stimulus bill passed by Congress in February, the American Recovery and Reinvestment Act, restored the limits in place during most of 2008 for the remainder of this year.

This good news from Bank of America will be especially helpful to buyers who are looking at real estate in Highlands or Cashiers North Carolina where the average sales price for a single family home in 2008 was over $600,000.    

At Meadows Mountain Realty we can answer your questions about buying or selling real estate and help you get on the right path to owning your perfect place on the Highlands Plateau.   Give us a call at 866-526-3558 or e-mail any of our brokers at info@meadowsmtnrealty.com.   We look forward to hearing from you soon.

Many people think of “Green” as “earth friendly” but in simple terms, “Green” refers to lessening the environmental impact from society. Today in the United States we need to be conscience regarding our Ecological Footprint. You are probably thinking, what is our Ecological Footprint?  It is “How much land and water area a human population requires to produce the resources it consumes and to absorb its wastes under prevailing technology.

The two primary Principles of Green are:

1) practicing resource efficiency and conservation and

2) practicing social responsibility.

The Green Concept for all of us on the Highlands-Cashiers Plateau is to be more conservative with our natural resources  and to focus on recycling of our waste materials. Some examples of this are 1) consumers to recycle products such as newspapers, metal cans, plastics, etc., 2) new construction building and remodeling to use every piece of lumber on the job and only discard scraps of lumber instead of four to six feet lengths of lumber, and 3) conserve our electric power, natural gases, and water to ensure that the needs of future generations are met.

Bill Bowen, one of the professional brokers at Meadows Mountain Realty is in the process of obtaining the National Association of Realtors “Green Designation”.     Bill can answer your questions on ways to assist in the conservation of our resources and ways you can help to protect our environment.   You can reach Bill by toll free at 866-526-3558 or by email at billbowen1@verizon.net.