An inside look at the residential real estate market in Southeast Texas including: the hottest neighborhoods, proven home selling strategies, home buying and negotiating tactics, median prices by neighborhood, average days homes are on the market, and professional advice on how to get the best deal when buying or selling a home.

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December 2007
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February 2008

January 2008

3 big questions before you refinance your mortgage

Coins_fallingEver heard the old rule of thumb if you can drop your interest rate by two points then you should refinance?  Well, that has got some truth to it.  But there are other things to consider before you rush down to the bank. 

How long are you going to stay in your current home?  How much are you going to save each month?  How much will it cost to refinance? Those are the 3 big questions.

First, staying put: 

If you are planning to move anytime in the next 12 months, you probably won't recover your refinance costs. It wouldn't make sense to refinance if a move is in your near future.

Second, monthly savings: 

To determine your monthly savings you'll need to do a little math.  To make it easy for you here's a link. Yahoo! Real Estate home mortgage refinance calculator will help you determine when you will break even on a refinance.  Here's an example.  Take a $200,000 mortgage at 7.5% interest with a 360 month term.  Your monthly payment would be $1,398.  The total interest you'd pay over the life of the loan would equal $303,434.  If you decided to refinance at an interest rate of 6%, your payment would drop to $1,199.  Saving you about $199 per month.  The total interest you pay over the life of the loan drops to $231,676.

Third: the cost:

Mortgage fees are going to vary.  View several lenders fees at Bankrate.com.  Our example above has a 1% origination fee and $2,500 in other fees and taxes.  For a total of $4,500 in refinance fees.  With a mortgage savings of just under $200 per month it would take you 23 months of payments on your new mortgage before you start saving money.  (Almost 2 full years.)  That was with a 1.5% rate drop. 

How much can you save?

Yahoo! Real Estate has a great article on refinancing basics.  Good charts for easy reading.  Times like now when rates have dropped to lows that haven't been seen for more than two years present opportunities for some homeowners to refinance and come out as big winners.  If you are paying more than 7% on your mortgage and plan to stay in your home for at least two more years you might want to talk with your lender.  Do it soon.  No one expects mortgage rates to stay this low for long.  Rates ended their five week drop according to CNNmoney.com.

So if you are thinking about whether you should refinance your mortgage just remember that old rule of thumb -the 2% rule- does have some truth to it.   

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2007 Beaumont home sales set new record

Hamster_trophy 2,491 homes sold in Beaumont, TX in 2007.

The Real Estate Center at Texas A&M keeps track of our Beaumont MLS housing activity. 

2,491 is a new record for Beaumont.  It beat out the second highest number of sales (2,345) which happened in 2006.  The years 2003-2005 had sales activity from 2,059-2,119.  2003 was the first year our housing sales topped 2000 on an annual basis.

Another good sign is the average and median price increases.  2007 set another record.  The average price of a home in Beaumont went up from $134,500 in 2006 to $146,500 in 2007.  The median price was up from $116,300 in 2006 to $126,200 in 2007. 

Beaumont homes have seen a 10% average price increase from 2006-2007.  Not bad when much of the country suffered while their home prices decreased. 8.4% decrease reported by MSNBC.

What is in store for 2008?  If only I had a crystal ball.  All indicators still look very positive for continued home appreciation in SE Texas.  With the most active months for home sales right ahead of us (March-August) now is the time put your home on the market if your planning to make a move this year. 

Will 2008 set a new record for the number of home sales?  Stay tuned.  I'll let you know this time next year.

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Do you really need Title Insurance?

Frustrated_ladyThe whole home buying process can get daunting at times.  For the non-professional there is so much to consider.  Do you need an inspection?  Do you need a home warranty?  And, today's topic:  Do you need title insurance? 

First:  What is title insurance?

Simply, it is a contract that protects the borrower/buyer against loss or damage due to title defects. It protects you if someone challenges the ownership (title) to the property.  In certain scenarios there can be title defects that are unknown when the property is purchased.  One nationwide survey found that in 25% of real estate transactions there are defects in the title that are usually unknown. That is where the title company plays an important role.  They check for defects in the title by examining public records.  The search done by a title company determines who owns the property, if there are any liens, and the condition of title. 

Second:  What does it protect you against?

For starters it protects against mistakes in recording of legal documents.  Forged deeds, releases or wills are covered.  Undisclosed or missing heirs including spouses are covered.  You will also be protected against deeds by persons of unsound mind, deeds by minors, and deeds executed under expired power of attorney. You will also have protection against liens for unpaid taxes and fraud. Want a more detailed explanation view Land America Commonwealth.

How long does title insurance last?  A policy will remain in effect as long as the owner owns the property.  It is a one time cost.  Its not a reoccurring fee like your home owner's insurance.

Third:  How much does it cost? 

Your policy cost is calculated on a formula tied to the total purchase price. Take the median priced home in our Beaumont housing market, a policy for $150,000 purchase price would cost approximately $1,110.  Title companies are governed by the Texas Department of Insurance and charge the same rates, which are set by TDI.

Yes is the answer.

You should spend the money on title insurance.  It is your assurance that the home you're buying is protected and covered from title problems.  A small price to pay to protect a big investment.

In Beaumont you have several choices of title companies. One choice Southeast Texas Title Company is associated with Chicago Title Insurance Company a company that has been in business more than 160 years. They are also members of the Texas Land Title Association.

Once you have a title insurance policy in place then you can focus on all the other important issues that go with buying a home. 

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Beaumont's Luxury Neighborhoods: Part 2

Luxury_interiorEven Martha Stewart would approve of this kitchen.

When you are looking at luxury homes at the upper-end of the Beaumont housing market, this is the type of quality kitchen you can expect to get for your hard earned money.

Today's neighborhood spotlight is Brownstone Place. 

This community is a prestigious enclave of homes off W. Lucas in the west-end.  The homes are located on three quiet residential streets, Brownstone Place, Christina Court, and Brownstone Drive. 

Brownstone Neighborhood Activity:

If you are looking to buy a luxury home in this exclusive neighborhood, you have three to choose from.  There's a 4 bedroom, 2.5 baths with a pool and game room on the market for $475,000.  Its not as expansive as some but it does offer over 3000 square feet of living space.  Need something a little bigger there is a 5 bedroom 4.5 bath with 3 car garage, pool and separate children's play areas. It offers over 5300 square feet of luxury living space. It will cost you about $799,000.

How about sales activity in Brownstone:

Brownstone had seven homes close during the past 12 months.  For a small enclave that's a healthy number of sales.  The highest sales price was $965,000.  That exclusive home spent only 58 days on the market.  The community averages 99 days on the market to sale.  That's a pretty quick turn around for a high-end neighborhood.  Seller's don't come off their asking price much either.  Seller's averaged 96% of their asking price over the past 12 months. 

Did you know Martha does have a line of homes she designed in partnership with KB Home?  The closest one to Beaumont is in Houston.  Its called Woodcreek Reserve. If Martha Stewart ever decides to move to Beaumont, Texas the community of Brownstone is one I bet she'd approve of.

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Looking for Luxury? Look in Montclaire.

Dscf0020 If you are in the market for a high-end home in Beaumont, you need to look in Montclaire.

This upscale community is located off Dowlen and Delaware in the center of the highly sought after west-end.

"Be warned, this community is not for the bargain hunter."

Home prices start in the high 600's and go up fast.  If you have more than two cars you are in luck.  Most of these homes boast 3 and 4 car garages.  Need some room to roam around in your home?  Will 4000+ square feet do it?  Everything on the market is currently 4000 square feet or larger. 

Seven homes are available for home buyers in the major league.  For $665,000 you can have a nice 4 bedroom 3.5 bath that is 4400 square feet.  The yard isn't huge.  Just about 1/3 of an acre comes with this home.  You will get some luxury interior features. Walnut flooring, a gourmet kitchen with double oven, brick arches, and Italian tile to name a few.  If your budget can stretch to $919,000 you can have a roomy mini mansion with 4 bedrooms, 4.5 baths, a 4 car garage with 5900+ square feet of living space.  This home boasts a fabulous swimming pool with rock wall, a butler's pantry, and a master bathroom suite with double shower.

Curious about the mortgage payments on one of these beauties.  How about $3,500+ per month not including taxes or insurance.  Want to calculate a payment?  Try this mortgage calculator from Realtor.com.

Not quite in your budget yet.  Well, no need to worry.  The high-end home is a small part of Beaumont's housing market.  There are many more homes priced near the median price of $150,000 in our housing market than there are in the luxury category. 

Even if you can't live in one of these homes yet, its still fun to look at luxury.

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Borrowing money just got cheaper.

Man_throwing_paperThe Fed acted today to try to stabilize a weakening economy and calm the worried equity markets.

3/4's of a percentage point slashed off two key interest rates. 

The full story is covered by CNN money

How low will mortgage rates go?  There are some ads for below 5% already on the Internet.  If you've been thinking about buying a house, it just got a whole lot more affordable.  Call your mortgage company today to see how low they will go.  Don't have one.  Call Lamar Mortgage for a quote.

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Town homes part 2: How fast are they selling?

Fast_dogs

Interested in a quick look at town home sales?

Beaumont's housing market is active.  Town homes move but not quite as fast as the single family homes it seems when analyzing the data.

Since Oct. 2007 23 town homes have sold and closed.  Six are pending.  Here's the lowdown:  In Beaumont's west-end town homes averaged about 100 days on the market.  The fastest sale took only six days.  Whew.  Average price of those that sold is about $93,000. 

The two new town homes communities mentioned yesterday both Cathedral Square and Metropolitan Park are in the luxury town home category.  Prices from about 170's at Cathedral Square and from the 200's at Metropolitan Park.

The average price of all town homes on the market at present is $169,000.  You can still find more affordable town homes in Beaumont's housing market if you look near Glen Meadow.  In fact 6 of the 23 sales were on Glen Meadow and Green Meadow. The most affordable sale was $53,000.  The most expensive on Green Meadow was $95,000.  Town homes there move quickly too 4 of the 6 sales took less than 45 days (about a month and a half).  So there you have it.  A quick look at Beaumont's town home sales activity for the last quarter.

Stay tuned for more Beaumont housing market updates.  Curious about your neighborhood?  Let me know and I'll take a quick look.

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Townhome developments on the rise in SE Texas.

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There are signs of a growing housing market all over Beaumont.

Residential construction is up.  In fact it made the front page of The Beaumont Enterprise newspaper today. New developments are planned.  Lots are being sold to builders who are just waiting to start construction on new homes.  Richard Guseman, president of the Home builders association of SE Texas was quoted in the Enterprise saying about our area -referring to Beaumont- "We've finally been discovered...and everyone is experiencing a lot of growth." His company for one plans to increase the number of homes they are building this year. 

One sign of our hot housing market is the increase in condos and town homes being built in the area.  Beaumont's housing market has two new town home projects. 

The first of the town home communities to arrive was Cathedral Square.  Located in the downtown historic district, these town homes and lofts are available from prices starting in the $140's for a one bedroom and 170's for a two bedroom.  Next to arrive is Metropolitan Park.  Metropolitan Park is located off Dowlen Road in the desirable Beaumont West-end.  It is the first master planned community in Beaumont that combines luxury residential living with shopping and office/retail space.  Beaumont's housing market took a big step toward major housing market status when Metropolitan Park broke ground.  A local Beaumont couple is making Metropolitan Park a reality.  The first town homes in Metropolitan Park have gone on the market.  You can buy a 2 bedroom 2 bath with prices starting around $202,000 and going up into the high 200's. The architectural renderings of the community are visually stunning.

Drawing_metro_park_condoIf you can't wait to see the new town homes in person, you'll have to practice some patience.  They are in the preliminary stages of development.  No exact dates yet when there will be finished product to see.  Right now the architectural drawings and your imagination will have to do.  If you want to be one of the first to own in Metropolitan Park you'll need to act now.  The first nine townhomes have come on the market and are now available for purchase.

More questions about either of these town home projects?  Send them to me and I'll answer them here.   

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