Most of the key economic indicators for real estate continue to be at least moderately positive — home sales are up, prices are stabilizing or up, unsold inventories are down, and even new unemployment filings are down slightly.

But there’s a storm cloud looming on the near horizon that everybody needs to keep an eye on: Mortgage rates have been moving up — fast. Bond market investors are spooked by the federal government’s massive borrowings to pay for the stimulus and the deficit.

They’re worried that serious inflation may be coming and they’re demanding higher rates on the ten year Treasury bonds that are the benchmark used to price mortgages.

But let’s focus first on the positive side of the ledger: A key housing price index released last week suggests that the long-awaited turnaround may be underway. The Integrated Asset Services Index - which is based on data from 15,000 local market segments around the U.S. — went flat on a national basis in May for the first time in a year.

Prices in the Northeast were up by six tenths of a percent for the month. In the Midwest they rose by one tenth of a percent, they were down slightly in the South, and flat in the Western region.

Now that might not impress you, but David McCarthy, CEO of the research and services firm, said flat means bottoming out - and in his words, “that’s encouraging (for housing) for the long term.”

In some California markets that had experienced severe hits during the darkest days of the bust, the price changes for the month were larger than the national numbers.

San Bernadino prices gained 1.1 percent between April and May. Monterey saw a 3.7 percent increase and Sacramento homes were up four tenths of a percent.

Meanwhile, ZIP Realty’s monthly national survey of unsold housing inventories found the number of MLS listings in 28 major markets down by 4 percent in May, and by 24 percent from year-earlier levels.

Now on to the sobering news on mortgage rates: No one can predict precisely how high rates are headed, but in the past two weeks they’ve jumped by more than a percentage point. The Mortgage Bankers Association reports that last week alone average 30-year fixed rate jumped to 5.6 percent from five and a quarter the week before.

Some analysts project rates to hit and surpass the 6 percent mark if current trends continue.

Bottom line: Given that house prices have turned around, and interest costs are soaring, value-conscious shoppers need to get their contracts and loan applications in — quick! Today’s Local Market Conditions Report

North Dallas, which is simply a generic term given to the northern suburbs of Dallas located north of 635, includes Addison, Carrollton, Farmers Branch, Plano, McKinney, Frisco and Richardson.

Addison

Addison, which is a great area for excellent dining, shopping and entertainment, boasts a diverse population of young professionals, families and empty nesters. The dynamic retail and commercial market of Addison makes it a popular spot for both residents and visitors alike.Most of the residents reside in the 1,500 single-family homes in Addison, with the rest reside in apartments and townhomes.

Carrollton

Carrollton is the place to be for Dallas families, as it has earned many accolades, including “Kid Friendly City,” and “Texas’ Safest City.”The cost of living, which falls below the national average by nearly three percent, is another benefit of residing in Carrollton. There is a wide selection of new and pre-owned homes in Carrollton to suit a wide variety of budgets, wants and needs.

Farmers Branch

Farmers Branch is an area of North Dallas best well known for its many businesses, including Coca-Cola and Haggar Clothing. Farmers Branch caters to a wide variety of homeowners, most of which are priced well below the national average. In fact, many of the single-family homes of Farmers Branch fall in the low $100,000s.

Richardson

Easy access to Plano, downtown Dallas and Addison, as well as its affordable home prices, make Richardson an ideal choice for Dallas professionals.

Plano

With many companies headquartered in Plano, residents find that life here is convenient and affordable. Plano offers a wide variety of real estate, from affordable to extraordinary. In fact, some of the homes in Willow Bend exceed $10 million.

McKinney

McKinney is an affluent, North Dallas community, which features homes from the low $200,000s to over $1 million. In addition, there is a great deal of new home construction in McKinney by many, major builders.

Frisco

As one of the fastest growing cities in North Texas, Frisco has seen its population nearly triple from 2000 to 2009.There are plenty of new home developments in Frisco, as well as more affordable, established neighborhoods.  Access to the city is easy via the Dallas North Tollway, and the Dallas-Forth Worth International Airport is just 30 minutes away.

A report released this week by Radar Logic finds signs of stabilization in home values, though cautions that some markets may see a continuing slide based on a buildup of foreclosure-related inventory and a typical seasonal slowdown in sales activity.

According to the company’s RPX Index, which measures trends in the price per square foot of homes in 25 U.S. metro areas, the freefall in house prices that was evident in 2008 has held roughly flat for the past several months — but the slowdown in the prices may represent just a step toward recovery.

The company reported a month-over-month price hike in nine U.S. metro areas in February, compared to monthly price increases in six MSAs in February 2008.

Radar Logic cited sales data from the National Association of Realtors trade group and from another monthly price index, the Standard and Poor’s/Case-Shiller price index for 20 U.S. metro areas, as evidence for market improvements — while noting that the operators of the Case-Shiller index do not believe a deceleration in downward price trends constitutes evidence for a recovery.

There will continue to be downward pressure on prices, Radar Logic states in the report.

The volume of motivated sales — defined as the sales of homes at foreclosure auctions and sales of foreclosed homes by financial institutions — has increased by 532 percent across the 25 MSAs tracked in the RPX Index since the beginning of 2006, while the other sales have declined by nearly 71 percent — for an overall sales decline of 58 percent.

The report states that motivated sales have jumped from 2 percent of all sales for the 25 tracked metro areas in 2006 to 38 percent in January 2009.

“Although prices in other sales have not corrected as much as prices in motivated sales, they have been moving downward, and in many (metro areas) other prices are starting to converge with motivated prices,” according to the report.

In some California metro areas, the price of “motivated” properties “appear to have become (or are in the process of becoming) the market price,” the report also states, though that “could actually be good news,” as it could suggest a return to normal value trends.

The report also warns that there have been reports of an “imminent surge in foreclosure filings” that could raise the inventory of foreclosed homes, and that — coupled with typical seasonal slowdowns in sales — could put more downward pressure on pricing.

And by spring 2010 the data should present “a clear picture of which way the market is moving,” Radar Logic reported.

Fraud Alert! - TREC has recently learned about a scam in which a person pretending to be an agency employee may call a licensee with a story about a problem with the licensee’s license status. The caller then offers to resolve the problem by asking for the licensee’s credit card number to make a payment by phone.

DO NOT RESPOND to requests from TREC asking you to provide personal information, including credit card numbers, social security numbers, or any other identifying information. TREC does not accept any payments by phone and will never make such a request. Please remember to always carefully guard your personal data. If you receive a suspicious call from someone purporting to be from TREC, we recommend that you ask the caller for his or her name, then hang up, call TREC at the number on the website, and ask to be transferred to that person.

If you have received a suspicious call involving TREC and gave out personal information or otherwise feel your security may have been compromised, please first file a report with your local police department and then notify TREC of the situation.

NEW YORK (CNNMoney.com) — The pace of U.S. job losses — while still fairly strong — may be abating, according to a couple of reports released Wednesday.

Automatic Data Processing, a payroll-processing firm, said private-sector employers cut 532,000 jobs in May, a 2.4% improvement from the revised 545,000 drop in April.

Economists surveyed by Briefing.com expected a more modest loss of 525,000 jobs last month. ADP originally reported a loss of 491,000 private-sector jobs in April.

ADP said that despite recent signs of a burgeoning recovery, employers will likely continue to cut jobs for the next couple of months, but not as quickly as in the past six months.

NEW YORK (CNNMoney.com) — The number of home sales contracts signed in April continued to bounce back from record lows hit last winter, according to a widely watched industry report. This is the third consecutive month of gains.

The Pending Home Sales Index from the National Association of Realtors rose 6.7% in April after jumping 3.2% in March. That was far above the forecasts of experts surveyed by Briefing.com, who predicted a 0.5% increase. The index was 3.3% higher than 12 months earlier.

Pending home sales are a forward-looking indicator since many of the contracts don’t result in completed deals for many weeks or months.

“Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” said Lawrence Yun, NAR’s chief economist in a prepared statement. “Since first-time buyers must finalize their purchase by Nov. 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers.”

The credit allows many homebuyers who have not owned a home in the past three years to claim up to an $8,000 refund on their taxes. The result has been a flood of first-time homebuyers even into lukewarm markets like Indianapolis, according to Glenn Bill, an agent there for Century 21 Sheetz.

“Our first-time homebuyer market is exploding,” he said. “That’s one good thing to come out of the stimulus package.”

Low prices

Also driving sales is falling home prices. The national median home price is down more than 30%, according to the S&P/Case-Shiller Home Price Index. That has drawn many bargain-hunting homebuyers back into the market.

Mortgage rates in April were also very favorable, averaging well under 5% for a 30-year, fixed-rate loan. However, rates have risen recently.

All those factors have raised NAR’s index of affordability to near record highs. It went up to 174.8 in April from an upwardly revised 171.9 in March, its second highest monthly reading ever. This index measures the relationship between home prices, mortgage interest rates and family income.

Regionally, the biggest improvement in home sales came in the Northeast, where they shot up 32.6%. Sales ramped up 9.8% in the Midwest, inched up 1.8% in the West and cooled 0.2% in the South.

Also boosting sales, according to NAR president Charles McMillan, a Coldwell Banker broker in Dallas, is that some states and non-profit agencies are helping first-time homebuyers come up with down payments.

“Some states are offering bridge loans that allow first-time buyers to use the tax credit for down payment and closing costs, but there are many other local government and nonprofit programs available to buyers, depending on location,” he said.

The Department of Housing and Urban Development announced last week an additional program that enables homebuyers to add the tax credit to their down payments on FHA mortgages at closing, which should also help to enhance affordability and give a push to home sales.

http://money.cnn.com/2009/05/04/real_estate/March_pending_home_sales/index.htm?postversion=2009050413

Buyers defy expectations with an increase in sales contracts signed during March.

NEW YORK (CNNMoney.com) — Is the housing meltdown ending?

Pending home sales rose in March for the second consecutive month and are up year over year. The Pending Home Sales Index from the National Association of Realtors showed a 3.2% gain to 84.6 from February, when it was 82. The index stands 1.6% higher than a year ago.

The consensus forecast of industry experts polled by Briefing.com had predicted no increase in the index.

It may still take a while before the market gains enough momentum to firmly state that the downturn has been reversed, according to Lawrence Yun, NAR’s chief economist. And, the upturn may have been boosted by the first-time homebuyers tax credit, a temporary measure that will lapse in December.

“We need several months of sustained growth to demonstrate a recovery in housing, which is necessary for the overall economy to turn around,” said Yun. “This increase could be the leading edge of first-time buyers responding to very favorable affordability conditions and an $8,000 tax credit, which increases buying power even more in areas where special programs allow buyers to use it as a down payment.”

The index is understood to be a forward indicator of home sales trends since it measures contracts signed, not completed sales. The up-tick may indicate that home prices have fallen low enough for buyers to get off the fence.

Feeling for the bottom

Yun is not calling a bottom yet, however, because the index is still at a relatively low level. Instead, he’s looking toward the summer selling season to determine what direction the market will take. Plus, he would like the number of homes on the market to drop to a more normal level of six to seven months of supply.

“If inventory goes down - it’s at just under 10 months now - to below eight months, that would mean we’re on the way to a sustainable recovery,” Yun said.

Anecdotal evidence indicates that trend may be happening. Realtors and other industry insiders are seeing rising open house attendance and multiple bids on some particularly desirable properties. Plus, pricing has become sharper, according to Sherry Chris, the CEO of Better Homes and Gardens Real Estate.

“Overpricing seems to be ending,” she said. “Properties are coming onto the market and selling quickly.”

And buyers are feeling a little more urgency, she added. In many markets, buyers have not felt any pressure to make an offer. “They said to themselves, ‘I don’t have to act immediately. It will still be on the market two weeks from now,’” she said.

Today, buyers are more likely to bid because they perceive the market as at or near its bottom. An April Gallup Poll reported that 71% of Americans thought it was a good time to buy a house.

They don’t, however, believe there will be price increases soon; three of four buyers think prices will stabilize or even decline in their areas over the next 12 months, according to Gallup.

Pat Newport, a real estate analyst for IHS Global Insight, is putting less emphasis on pending home sales than he once did for his housing market analyses. There has been a disconnect lately, he said, between the number of properties going into contract (pending home sales) and the number that actually close (existing home sales).

He speculates that this is because buyers are making offers and signing contracts but, because of financing problems, many deals are falling through. 

Regional differences

The South saw the largest gain of any region, with pending home sales jumping 8.5%. Pending sales are 7.7% higher there compared with a year ago.

The Midwest gained 3.9% from February and 1.7% year-over-year. Northeast sales fell 5.7% and are off 24.1% compared with March 2008. The West dropped 1% for the month but are up 8.2% year-over-year.

Low home prices continued to help to drive sales, although NAR’s affordability index actually fell 2.3% from February, when it hit a historic high. This index is based on family income, home prices and mortgage rates.

“Compared to a year ago, the typical family can pay much less in mortgage costs for the same home, or buy a better home without necessarily increasing their monthly payment,” said NAR President Charles McMillan, in a prepared statement. “For buyers who’ve been on the sidelines and have good jobs, the market has never looked more favorable.  

Real Estate

Dallas real estate offers home buyers many affordable opportunities. According to the Texas A&M Real Estate Center, the median price of a new house as of January 2008 was $147,300. Real estate in Dallas has often been considered a value because of the many inexpensive new and resale opportunities. In addition, the city is home to many large corporations and small businesses that consistently provide the city with economic growth and opportunity.

New Homes

The recent correction in the real estate market has increased the amount of available Dallas new homes. As of January 2008, The Texas A&M Real Estate Center reported that the city had over 28,000 houses for sale. This large inventory of new homes to choose from gives families the ability to choose a house that fits their needs, wants and budget. Value pricing, low interest rates and choices make buying a new home a good opportunity for a long-term investment and family home.

 USPS: First Class Stamps Increase Two Cents On May 11,2009

The Governors of the U.S. Postal Service have approved new prices for mailing services, including a 2-cent increase in the price of a First-Class Mail stamp to 44 cents. Prices for mailing services are reviewed annually and adjusted each May. The new prices will go into effect Monday, May 11. The new prices are available at usps.com/prices. 

In addition to providing a $7,500 tax credit for qualified first-time home buyers, the Housing and Economic Recovery Act of 2008 includes a number of other provisions that will help prevent foreclosures, reinvigorate the housing market and strengthen the nation’s economy.

Federal Housing Administration Modernization
The maximum FHA-insured loan will be increased to 115 percent of an area’s median home price, up to a maximum of $625,500, with a minimum downpayment of 3.5 percent, up from 3.0 percent currently. The legislation will give the agency greater flexibility to respond to the needs of borrowers, enable more working families to become home owners, provide a viable alternative to the volatile subprime market and allow the FHA to play an important role in stabilizing the mortgage markets.

Foreclosure Relief
The legislation will allow the Federal Housing Administration to guarantee up to $300 billion in refinance mortgages where current mortgage holders agree to accept partial payment so the outstanding principal on the new loan is more affordable for borrowers. This could help as many as 400,000 struggling home owners to stay in their homes, according to Congressional Budget Office estimates.

Mortgage Revenue Bonds
States will be provided new authority to issue an additional $11 billion in bonds to be used to refinance subprime loans, mortgages for first-time home buyers and multifamily rental housing. Expanding this program will help strapped borrowers seeking to refinance their home loans.

Government Sponsored Enterprises
The legislation will reform the regulation of housing government sponsored enterprises (GSEs) Fannie Mae, Freddie Mac and the Federal Home Loan Banks by establishing a strong, independent regulator that will have enhanced authority to raise capital standards and take corrective actions if the GSEs are undercapitalized. It will also permanently increase the maximum loan limit to $625,500 for Fannie Mae and Freddie Mac. This will help buyers seeking homes in high-priced markets such as California and the Northeast.The bill also creates a new affordable housing fund to be financed by the GSEs. The fund will be used to finance the construction, maintenance and preservation of affordable rental housing projects nationwide.To boost investor confidence in Fannie Mae and Freddie Mac, the bill includes a Treasury proposal that will temporarily expand the government’s line of credit to Fannie and Freddie and permit the Treasury to purchase an equity stake in the companies through the end of 2009.

Low Income Housing Tax Credit (LIHTC)
The legislation makes significant enhancements to the LIHTC and tax-exempt housing bond programs, which would increase their effectiveness. The LIHTC plays a key role in the construction and rehabilitation of affordable residences. Enhancing this program will enable builders and developers to expand the supply of much-needed affordable rental housing.

Property Taxes
The legislation will provide temporary tax relief for home owners who do not itemize their deductions. For tax year 2008, taxpayers who do not itemize their deductions but pay property taxes will receive a $500 additional standard deduction ($1,000 for married couples). This provision will particularly benefit home owners who have paid off their mortgages.

Community Development Block Grants
The legislation provides $3.9 billion in grants to state and local governments for the purchase of foreclosed homes and the rehabilitation or redevelopment of residential property.