The Gardner Group Blog

One of Austin's favorite festivals is its most laid back: What says "life is good" better than a day spent flying a kite? The 81st Annual Zilker Park Kite Festival is Sunday, March 1. (Read the full story here, complete with activitiy details AND parking info.) As fun as flying a kite is, just as fun is making your own kite. Click here for easy, step-by-step instructions that moms and dads can follow to help their kids make their very own kite! Get your colored markers out, and have fun. 

From Austin.com

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Realtors' group sees ‘slow, sustainable growth' in sales activity

NEW YORK - Better news from the U.S. housing industry sent stocks higher Tuesday, including an increase in the number of people with contracts to buy homes.

The National Association of Realtors, a trade group, said its index of sale contracts rose 1 percent in December. It was the ninth improvement over the past 10 months as buyers scrambled to take advantage of a first-time homebuyer tax credit before it was set to expire last November.

"It's a slow, sustainable growth," said Daniel Penrod, senior industry analyst for the California Credit Union League. "Most people would prefer a quick rebound but that's not likely to happen."

The home sales report was the latest bit of encouraging news on the economy. Stocks rose on Monday after a surprisingly strong reading on the manufacturing sector, and on Friday the government reported that the U.S. economy grew at an annual rate of 5.7 percent in the final three months of 2009, a faster pace than expected.

Homebuilder stocks rose sharply after D.R. Horton Inc. posted its first profit since 2007 during its fiscal first quarter. Much of its $192 million profit during the October-December period came from a tax gain, but its revenue rose because of a 36 percent jump in home sales. Orders increased 45 percent.

The reports brought a positive tone to the market, which stumbled in late January as concerns arose that the recovery might be stalling and that the market's 10-month advance was running out of gas. The Standard & Poor's 500 index fell 3.7 percent in January, its worst month since hitting a 12-year low nearly a year ago.

According to preliminary calculations, the Dow rose 111.32, or 1.09 percent, to 10,296.85. The S&P 500 index rose 14.13, or 1.30 percent, to 1,103.32, while Nasdaq composite index advanced 18.86, or 0.87 percent, to 2,190.06.

Bond prices inched higher. The yield on the benchmark 10-year Treasury note, which moves opposite its price, dipped to 3.64 percent from 3.66 percent late Monday.

 Click here for the rest of the article.

Story by Associated Press

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Sales of existing home sales in Central Texas rose 5 percent in December from the previous December, bringing total sales for 2009 to 19,005, down 6 percent from 2008, the Austin Board of Realtors reported.

The median price was up 6 percent in December, to $194,000, but throughout 2009 it slipped 1 percent, to $188,480, the board said.

Sales climbed dramatically in October and November as buyers rushed to take advantage of the original Nov. 30 deadline for first-time homebuyer tax credit, which has since been extended and expanded to repeat buyers through April.

"However, increases in sales volume beyond November and figures that have improved steadily throughout the year indicate that, while some demand was driven by the tax credit deadline, a sustainable recovery is also underway in the real estate market," said John Horton, the board's chairman. "We're seeing encouraging news from many sources that 2010 will be an improvement over 2009, and I think this report is one more indicator the outlook is beginning to brighten."

Homes stayed on the market longer in December, an average of 88 days compared with 85 in December 2008. The number of homes on the market declined, with December's 8,079 listings down 5 percent from the previous December.

from Statesman.com

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When the weather here in Austin turns cold or cloudy, there are many indoor activities available throughout the town and the Bob Bullock Texas State History Museum downtown at MLK and Congress is right at the top of fun things to see. It's not just another boring old dusty museum, it's the newest museum in Austin and it offers three floors of interactive exhibits that appeal to all ages as well as Austin's only IMAX Theatre. Physical exhibits and media programs are augmented by recreated environments that bring home the sights, sounds and even the smells of Texas to you as you take the tour. The Museum offers a plethora of historical items almost too many to name. Among other things, you will find old uniforms and period costumes, oil paintings, musical memorabilia, Native American artifacts, pistols, cookware, Republic of Texas money, lots of rare political items, postcards and photographs of old Texas scenes. This is not a small museum and you need to set aside at least an hour or more to take in everything.

In addition to the historical exhibits, the IMAX Theatre is a big draw and they offer three IMAX films. "Texas: The Big Picture" is their signature film and offers a panoramic overview of our state that meshes nicely with the historical exhibits. "Magnificent Desolation: Walking On the Moon in 3D" chronicles the moonwalks of America's astronauts with astounding imagery. The latest arrival at the IMAX is "Roving Mars," which tells the story of the Mars rovers that are still exploring the Red Planet as you read this article.

The Museum is open Monday through Saturday 9am - 6pm and on Sunday from Noon to 6pm. Admission is $3 for children (5-18), $5.50 for adults and $4.50 for seniors (65 and up). IMAX tickets are extra.

There is also a Cafe located with the Museum that serves salads, soups and sandwiches from 10am - 3pm Monday through Saturday and Noon - 5pm on Sunday.
The parking garage is located on the south side of the Museum off of 18^{th Street.} For more information, you can go to www.thestoryoftexas.com

From Austin.com

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HUD is now allowing "monetization" of the tax credit. What does that mean?
It means that HUD allows buyers using FHA-insured mortgages to apply their anticipated tax credit toward their home purchase immediately rather than waiting until they file their 2009 or 2010 income taxes to receive a refund. These funds may be used for certain downpayment and closing cost expenses.

Under HUD's guidelines, non-profits and FHA-approved lenders are allowed to give home buyers short-term loans of up to $8,000. The guidelines also allow government agencies, such as state housing finance agencies, to facilitate home sales by providing longer term loans secured by second mortgages.

Housing finance agencies and other government entities may also issue tax credit loans, which home buyers may use to satisfy the FHA 3.5 percent downpayment requirement. In addition, approved FHA lenders can purchase a home buyer's anticipated tax credit to pay closing costs and downpayment costs above the 3.5 percent downpayment that is required for FHA-insured homes.

More information about the guidelines is available on the NAHB web site. Read the HUD mortgagee letter (pdf) and an explanation of the FHA Mortgagee Letter on Tax Credit Monetization (pdf). An FAQ about monetization (pdf) is available at the NAHB web site.

 You can find more information on the Federal Housing Tax Credit here.

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According to a January article from Realty Times, investors are once again gaining confidence in real estate as a solid investment. Low interest rates, low home prices, and a wealth of properties on the market are all contributors to this trend. To read the entire article, click here.

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Austin-area home resales jumped 58 percent last month from November 2008 as buyers scrambled to take advantage of low mortgage interest rates and a tax credit for first-time buyers.

But local experts don't expect those big percentage gains to continue. Sales could slow next year, they said, anticipating rising mortgage interest rates and the end of the tax credit, which Congress recently extended through April and expanded to additional buyers.

November's percentage increase was the biggest in more than a decade and followed a 38 percent jump in October, according to the Austin Board of Realtors. However, the 997 sales in November 2008 were unusually low, reflecting the worsening economic downturn at the time.

Last month, 1,576 homes were sold, the board said. The median price was $179,900, down 2 percent from a year ago.

"The numbers are certainly welcome news," said David Reed, a senior loan officer with Austin-based Land Mortgage. "Fifty-eight percent is huge, even if you factor in the extra selling days in November compared to last year."

With the median price holding relatively steady, "it's even better news still," Reed said.

But the market isn't in the clear yet.

More challenges are ahead because of "minimal prospects for short term improvement in the local economy and our job market," said Eldon Rude, local director for Metrostudy, a housing research firm.

He said he doesn't expect the market to show strong growth "until the employment picture brightens and consumer confidence strengthens."

Rude said the sharp increase in November resales "was definitely tied to the availability of the tax credit but was also related to the significant slowdown in sales activity late last year as the U.S. recession took hold."

With the extension, first-time buyers may still qualify for up to $8,000, but other buyers can get up to $6,500. Buyers must have a house under contract by the end of April and close on the sale by the end of June.

Year-over-year sales were up 31 percent in the Dallas area, also one of the biggest increases on record; 32.8 percent in Houston; and 52 percent in San Antonio.

Reed said he thinks the tax credit alone wasn't enough to spur the Austin area's November surge.

He said that interest rates of less than 5 percent also were a factor, as was the specter of rising rates. Reed predicted that interest rates will move into the mid- to high 5 percent range by the end of next year's first quarter.

Some real estate agents voiced optimism about 2010.

"It just seems like the numbers are going steadily up, along with the economy," said Nell Hurtado, an agent with JB Goodwin Realtors. "People have a different attitude. They're more upbeat about the economy."

Reed said he still foresees "a positive year for sales growth in 2010 - just nothing like a robust November we just had."

From statesman.com 

snovak@statesman.com; 445-3856

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 A first time home buyer recently asked whether he should consider a duplex over a single family home and what was meant by saying location, location, location.  My answer follows:

In Austin I believe there are only a few scenarios where a duplex makes sense, and the following are a some examples:

 

• * The buyer needs a tenant to share in the payment to make a monthly payment comfortable when a condominium is not suitable for the buyer's lifestyle. 

 

• * The buyer has parents who need to be near for health reasons, and the family  cannot afford separate residences near one another. 

 

• *The buyer picks up a duplex in a predominantly single family area - usually in an older part of town and with single family on both sides of the duplex- and holds on to hold the land as an investment using the dual rents of the duplex to pay for it because the dirt in that area is appreciating at a minimum of 15% annually across period of time.  In this example, the owner  would eventually be looking for a buyer who wants to convert the duplex to single family at sale or possibly demolish the structure and build a single family home.

 

The downside to duplexes, at least in Austin, is the appreciation differential when compared with single family.  Duplex appreciation is for the most part tied to the rents it can bring, while single family areas will go up based on other considerations that are not constrained by income production potential.  I have seen duplexes appreciate at 1%-2% annually from a bust to boom cycle - say a 5 year period - where single family in the same area appreciated at an average of  8%-10%.  Even when you take into account the rental income and tax implications of both properties, were you to live in one side of the duplex, the single family comes out ahead as an investment, albeit in some cases only marginally, and was probably a more enjoyable place to live.  In that same cycle, keep in mind there would have been single family areas that went up as much as 16%-18%, in which case the single family would FAR outpace the duplex in appreciation.  The tough part is finding that area...which brings me to location.

The old location, location, location axiom simply means you can always change the house - from a cosmetic remodel to a demolition and re-build - but you can't change where the house is.  Location is always paramount in a purchase.  This is true when considering one neighborhood over another - you may only be able to  afford a fixer upper in what would be considered a great location in a given city, where in an average or poor location in town you can buy a home that has everything you want.  For example, a home  in a cul-de-sac, backing to greenbelt on a large lot that comes with laminate counter tops, cheap carpet and linoleum flooring but is the same price as a home in the neighborhood that backs to a busy road where noise is a significant issue but that comes remodeled with granite counters, plush carpet and tile flooring at the wet areas may be the more desirable purchase.

Brandon Gardner

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During the holiday season, Austin Children's Museum has even more to offer its visitors. From decorating yummy, sticky gingerbread houses to shopping for presents in our Museum Store, tax-free, there is something at Austin Children's Museum (201 Colorado) that every member of your family can enjoy.

Shopping in the Museum Store
Get all your holiday gifts for kids and the young at heart. You'll find educational toys, art supplies, stocking stuffers, gingerbread house kits and more. All Store profits benefit the work of Austin Children's Museum. We also offer free gift wrap while you wait.

 Holiday Savings on Memberships
Give the gift your friends and family can enjoy year-round - a Museum Membership. Of course, you could always just get one for yourself. Buy between November 27 and December 31 and get $10 off. With the purchase of a membership, guests will enjoy one year of unlimited admission as well as discounts on programs and other benefits. For more information on membership and to buy online visit austinkids.org.

ABOUT ACM
The mission of the Austin Children's Museum is to create innovative learning experiences for children and families that equip and inspire the next generation of creative problem solvers. Located at the Dell Discovery Center downtown at the corner of 2nd Street and Colorado, the Austin Children's Museum is one of the city's popular cultural attractions with 210,000 visitors annually. Founded in 1983 as a non-profit organization, the Austin Children's Museum delivers its mission through a variety of exhibits, programs and outreach activities. For more information, please visit www.austinkids.org.

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After falling to the lowest level in at least 38 years, long-term mortgages followed bond yields higher this week.

A 30-year fixed-rate mortgage averaged 4.81 percent in the week ending Dec. 10, up from 4.71 percent last week. Long-term rates are still well below year ago levels, when 30 year mortgages averaged 5.47 percent.

A 15-year fixed-rate mortgage averaged 4.32 percent this week, with one year adjustable-rate mortgages averaging 4.24. percent.

"Following an upbeat employment report, long-term bond yields rose slightly and fixed mortgage rates followed," says Freddie Mac (NYSE: FRE) chief economist Frank Nothaft.

Pending sales of existing homes rose for the ninth consecutive month in November, up 3.7 percent from the previous month. Pending sales of existing homes were up almost 32 percent from a year ago, the biggest annual increase on record.

The National Association of Realtors now predicts self-sustaining housing market conditions and firming home prices in most areas by the middle of next year, citing a continued decline in inventories.

From Washington Business Journal

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