Will the Home Buyer Tax Credit Be Back?

With July home sales down about 30 percent.  Many are asking if the government will intervene again to help the housing market.  United Press International reports Housing and Urban Development Secretary Shaun Donovan is not ruling out the possibility of bringing back the tax credit

Donovan said on CNN's State of the Union show yesterday that it is "too soon to say" whether the administration's $8,000 first-time homebuyer credit tax credit, which expired April 30, will be revived."All I can tell you is that we are watching very carefully," 

Donovan said. "We're going to be focused like a laser on where the housing market is moving going forward, and we are going to go everywhere we can to make sure this market stabilizes and recovers."

 The tax credit combined with the record low interest rates would make investing in the housing market more affordable than ever before.  It will be interesting to see what HUD decides to do.

Torpedo Found and Dragged to Port Richmond

Finders is not keepers for two men who found a 1,000 pound torpedo in the Delaware River.  The Inquirer reports an archaeological crew responded and found the two men sitting on the torpedo drinking beers.  The beers were much deserved after it took the men 6 hours to drag the torpedo ashore.  Established military regulation require the men to give their catch back, but they have their 15 minutes of fame.

                                                    Alejandro A. Alvarez / Philadelphia Inquirer Staff Photographer

Bad Bays

Photo: Brownstoner Philly

I have recently read stories on Plan Philly and Brownstoner Philly about new construction bays.  I myself have noticed the new bay windows that are completely devoid of the charm and character we come to expect from this architectural feature.  In an effort to create the most amount of livable square footage, developers have created huge box bays.  These windows are typically covered in stucco or other price conscious materials.  They also take up much of the facade of the building.  Graduate hospital and Washington Square West neighbors are calling the city in droves to complain.  Brownstoner featured the efforts of the South of South Neighborhood Association to get clarification on/changes to the zoning that has allowed these bays to be approved.  Recently the residents of Bradford Alley in Wash Sq. West have encountered the wrath of the bays.  Plan Philly reports on a colossal new construction duplex that received approval to build only 2 1/2 feet from the street then began to build protruding bays.  Neighbors feel it blocks sunlight to the street and hurts the historic charm of the street.  Below is a picture of the Bradford Alley new construction.  Hopefully the attention to this particular new construction aesthetic will help bring about some changes.

Photo: Plan Philly

Philadelphia Rowhouse Manual

The Philadelphia City Planning Commission published a comprehensive guide to owning a rowhouse.  For housing geeks like me it is riveting reading, but for others with a life, it is easy to browse.  Here is the table of contents for the manual:
History of the Philadelphia Rowhouse

• Colonial to early 19th Century
• Mid to late 19th Century
• 20th Century

Outside the Rowhouse

• Exterior Walls
• Insulation, Vapor Barriers and Air Quality
• Porches, Steps, and Stoops
• Windows
• Up on the Roof 
• Plantings and Gardens
• Parking

Inside the Rowhouse

• First Floor
• Kitchens and Laundry
• Stairs
• Bedrooms and Closets
• Bathrooms
• Flexible Spaces
• Basements
• Interior Materials
• Mechanical Systems
• Structural Considerations

Your Rowhouse

• The House is Too Small-A Case Study
• The House is Too Large-A Case Study
• Maintaining a Rowhouse
• Renovations and Additions
• Permits and Codes
• Resources

Giant Three-Way Plug is New Addition to Philadelphia Museum of Art's Sculpture Garden

The Inquirer reports Claes Oldenburg's Giant Three-Way Plug "was at last plugged in" to the art museum's sculpture garden this morning.  Other Oldenburg sculptures in the city include the Clothespin at 15th and Market and Split Button on the Penn Campus.

   
David Swanson / Staff Photographer Philadelphia Inquirer

Update: Historical Commission votes to allow demolition of 11th and Spring Garden Church

PlanPhilly reports "The Church of the Assumption, the historic 19th-century church at 11th and Spring Garden Streets, moved closer to demolition on Tuesday, when the architectural committee of the Philadelphia Historical Commission voted to grant the owner permission to raze the building based on financial hardship".

Buyer and Seller "Don'ts"

It is tough to get to closing these days.  I previously blogged about the lender obstacles, but Money magazine points out the difficulties caused by buyers and sellers having unrealistic expectations.  This chart dispels the myth that you will get the property for far below asking.  

Here are a few of the key "don'ts":

Don't say: "I'll pay 85% of your asking price and not a penny more."

Instead: Look for homes that are fairly priced and make a reasonable offer. "Coming in about 10% below list is a good starting place for negotiations now," says Denver real estate broker Jeff Fogler. Yes, you have the upper hand in most markets, but the average homebuyer is paying only 2.7% below list price (see the chart). Set your expectations accordingly. You can always ask if the seller is willing to bridge a price gap in other ways -- for example, by picking up your closing costs (which can run $7,500 on a $300,000 house).

Don't say: "You're offering how much? Forget you!"

Instead: When bidders lob low-balls at you, thank them for their interest -- and ask that they come back with earnest offers. "If you become offended, enraged, or unreasonable, you've blown any chance at negotiation," says Warwick, R.I., real estate agent Ron Phipps. These days many buyers are just testing you to see how big a discount they can get. Point the bidder to comparable recent sales that support your list price. (Received several super-low offers? Check the comps to make sure your price isn't too high.)

Don't say: "I haven't put my own place on the market yet."

Instead: List your current home before you start shopping seriously for the next one. Because it takes almost three months to move a house these days, sellers are loath to write home-sales contingencies into purchase contracts. You'll have far more leverage if you've gotten rid of your house before you start negotiating: Sellers know there's less chance of the deal falling apart. (Prequalifying for a mortgage helps too.) What's more, you'll know exactly how much money you can put into your new digs.

The Church of the Assumption In Danger of Demolition

Plan Philly Photo.
I have often wondered what is happening with the beautiful church at 11th and Spring Garden.  Plan Philly featured The Church on it's website in an article about the possible plans to tear the building down.  Alan Jaffe describes the plans "Siloam, a social service agency for people living with HIV/AIDS, owns the church building and the adjacent rectory and convent.  It had sought a demolition permit for the church in order to rebuild on the site or create more parking space.  On Aug. 24, Siloam will go before Philadelphia Historical Commission to argue that it has not been able to find a buyer for the building and can't afford the cost of restoration"  Apparently it will costs upwards of $5 million to restore the building and interested buyers over the years have decided against the purchase because owners have dismantled many of the interior features.  Below are two more striking photos from the Plan Philly website.

Comprehensive List of Who to Call with your Philly Home Problems

The Bella Vista United Civic Association has a great list of phone numbers for neighborhood problems.

Problems (Who Can Help)

• General block cleanup
• Phila. More Beautiful 215-685-3969
• Overflowing dumpsters, illegal dumping, leaflets on doors & car windshields
• Environmental Response Unit of Police Dept. 215-686-3082
• Potholes or hazardous sidewalks
• Streets Dept. 215-686-5560
• Uncollected trash or recyclables
• Streets Dept. 215-686-5560
• Damaged mailbox
• U.S. Postal Service, Maintenance 215-895-8331
• Tree limbs in contact with electrical wires
• PECO emergency services 215-841-4141
• Gas leak
• PGW emergency line 215-235-1212
• Open fire hydrant, flooded intersection, trash in streams or abandoned car in river
• Water Dept. 215-685-6300
• Damaged bus shelter
• Outdoor Systems 215-568-5517
• Collapsed street due to water or sewer main break
• Water Dept. 215-685-6300
• Missing manhole covers (depending on whose manhole cover is missing)
• Water Dept. 215-686-3300
• Phone company 611 
• PGW 215-235-2050
• PECO 215-841-4141
• Public buildings that are firetraps or contain dead animals
• L&I 215-686-2463
• Dead animal in your house
• Streets Dept. 215-686-5560
• Rats
• Health Dept., Vector Control 215-685-9719
• Dog doo doo
• Environmental Response Unit 215-686-3082
• Broken traffic light or missing/broken street sign
• Streets Dept. 215-686-5560
• Broken street light
• Streets Dept. 215-686-5560;
• after hours call 215-697-8844
• Trash-strewn lot, abandoned/dangerous buildings, auto repair in public street
• L&I Services & Operations 215-686-2463
• Loud noise, oar and building alarms, foul odor
• Air Management Div. of the Health Dept. 215-823-7583
• Graffiti
• Phila Anti-Graffiti Network 215-685-9900
• Murals 
• Mural Arts Program 215-683-3689
• Abandoned car; call local police districts abandoned car officer
• For number in your neighborhood 215-686-3000
• Nuisance bar, underage drinking
• State Police Liquor Control Enforcement Squad 215-560-4111

Frozen Yogurt Shop Opening in Former Ritz Camera at 9th and South

It looks like a Berry Sweet Frozen Yogurt plans to open up in the shop formerly occupied by Ritz Camera.  I haven't been able to find any more details, but the shop should be a welcome addtion to the busy intersection.

Philly Has a Tool Library

The Greater Philadelphia Urban Affairs Coalition opened a shop in 2008 where homewoners can check out the tools they need to do basic home repairs and maintenance.  For just $20 annually members have access to over 2100 tools.  The Library is open evenings during the week and during the day on Saturday.  Check out their website and blog at http://www.westphillytools.org/.

CNN Model Does Remarkably Well in Housing Market Predictions

In 2006, CNN Money did a story ranking the top 299 housing markets according to how overvalued they were.  It could be inferred that those markets would see significant downward price adjustments these last few years.

Many Florida markets topped the 2006 list.  Las Vegas also ranked high on the list with a prediction of being overvalued about 50 Percent.  Florida and Vegas are now notorious for the steep housing declines that happened over the past four years.  In the 2006 report Philly was predicted to be overvalued about 15%.

This year CNN released new rankings showing the adjustments to the 300 or so markets and new average home values.  Many of the Florida markets did adjust down roughly the amounts they were predicted to be overpriced.  The same happened with Las Vegas.  Many Florida markets and Las Vegas are actually now undervalued.  Philly is also now on the undervalued list with a prediction of the market being undervalued about 3 percent.  The new rankings are great news, for many markets, if they are as good a predictor as they were in 2006.  While five years ago people would have been disappointed to be told their home values would only increase a few percent over the next few years, I think many Philly homeowners would now be happy with a slight increase in their home value.

 The new 2010 report did have bad news for homeowners in some markets.  As I blogged last week, attention is on Atlantic City.  This report predicted a 30% overvalue in its home values.  Ocean City, NJ was also on the list and predicted to be around 25 percent overvalued.

Philly Condo Market Booming

There was a large increase in condo sales during the last quarter.  The inquirer did a recent story on the Philly condo market in which they said "Condo sales in Philadelphia nearly doubled from the first quarter of this year to the second, and the numbers were better than at any time since the housing downturn began here in August 2007."

Most people think of first time home buyers as the one's buying condos in the big city, but in Philly, many of the new condo owners are retirees choosing Philly as the destination for their carefree years.

Philly Home Buying Hurdles

One of the biggest hurdles in the home buying process is the mortgage commitment.  Both established homeowners and first time buyers are having difficulty getting the mortgage in order before closing on the home.  MSN outlines 6 new hurdles for home financing.
1.  Higher credit score requirements

2.  Greater scrutiny of income and assets

3.  Ever-changing borrower requirements

4.  Home appraisals are coming in low

5.  Fewer opportunities for small business owners and independent contractors

6.  Condo purchases face additional tests

These problems seem to be confounded when a buyer is trying to use an internet lending company or out of state company.  Sellers are actually rejecting offers with buyers pre approved through an internet lender because of concern the deal will not close. There is a lot of value of knowing the loan officer and being able to get in touch with him/her easily. 

A.C. Trouble

The awful real estate woes of Las Vegas are drifting eastward to the other gambling hot spot.  Forbes named Atlantic City 1st in thier ranking of "tomorrow's real estate trouble spots.

The Full List of Trouble Spots:

10. Salisbury, Md.,
      Equilibrium Home Price: $131,902.00, 12-month Price Forecast: -8%

9. Eugene-Springfield, Ore.

    Equilibrium Home Price: $180,210.00, 12-month Price Forecast: -8%

8. Charleston-North Charleston-Summerville, S.C.,
    Equilibrium Home Price: $215,054.00, 12-month  Price Forecast: -9%

7. Salt Lake City, Utah
    Equilibrium Home Price: $190,599.00, 12-month Price Forecast: -10%

6. Flagstaff, Ariz.

    Equilibrium Home Price: $219,260.00, 12-month Price Forecast: -13%

5. Bellingham, Wash.

    Equilibrium Home Price: $230,024.00, 12-month Price Forecast: -9%

4. Glens Falls, N.Y.

    Equilibrium Home Price: $177,003.00, 12-month Price Forecast: -11%

3. Portland-Vancouver-Beaverton, Ore.-Wash.

    Equilibrium Home Price: $189,818.00, 12-month Price Forecast: -9%

2. Provo-Orem, Utah

    Equilibrium Home Price: $136,247.00, 12-month Price Forecast:-12%

1. Atlantic City-Hammonton, N.J.

    Equilibrium Home Price: $159,117.00, 12-month Price Forecast: -9%

Walking in Philly

One of the biggest benefits of living in Philly is the convenience.  I am a Philly transplant from a Midwestern city with a driving culture.  I find myself constantly trying to explain how fantastic a walkable neighborhood is to people from home.  Apparently more and more people are coveting walkable neighborhoods and The Wall Street Journal published A Walker's Guide To Home buying.

Here are some walk scores for Philly neighborhoods:

19130's walk score: 91 "Walker's Paradise"
19123's walk score: 94 "Walker's Paradise"
19106's walk score: 100, "Walker's Paradise"
19107's walk score: 97, "Walker's Paradise"
19102's walk score: 98, "Walker's Paradise
19103's walk score: 98, "Walker's Paradise
19147's walk score: 94, "Walker's Paradise"
19146's walk score: 63, "Somewhat Walkable"
19148's Walk score: 78 "Very Walkable"
19145's Walk score: 80 "Very Walkable"