2008 will be remembered as the year that…. OK, lets hope that 2008 is not remembered at all. Well at least not the last 3-4 months. The year actually started off with some steam still in the Houston housing market. Although the number of sales declined each month from the same time in the previous year, the average home price continued to rise for 7 ½ months, with only a slight decline in August and September. The decline in the number of sales was more prevalent in August thru November running 20% to 32% off from the same month in 2007. The average sales price dropped from a high of $226,072 to $187,866 in November. December numbers are not complete yet, but appear to have recovered a little.
Several things have caused the decline. The slide in the national economy has gradually worked its effects into the Texas market. Many buyers have set on the sidelines waiting and watching to see when the market will improve. Waiting the results of the national elections also put a stall in the motion of the economy. Locally, the Houston area took a hit when a little thing call Hurricane Ike blew through.
While the press likes to report on negative stories, I am keeping a positive attitude. The current inventory of home listings in the Houston area is at an all time low. I believe there is pent-up demand from buyers. Interest rates are low. I think things will turn around soon and therefore, I am expecting 2009 to be a good year.
I’m sure you have seen one of the TV commercials where the couple says we have paid for our home and now it’s time for our home to pay us. Well a “reverse mortgage” does just that. It’s similar to the regular home equity loan where you borrow against your equity, but you don’t make any monthly payments. In fact you don’t make any payments at all. You actually receive payments. You can set it up to receive a monthly payment or set up a line of credit to tap into whenever you want.
As usual, there are requirements. To begin with, reverse mortgages are only for people 62 years of age and older. It’s designed to help seniors in their retirement years. It’s really a good possibility for those who are strapped for cash and would otherwise have to sell their home to raise money. With the reverse mortgage, you can borrow the money and still live in your house without making any payments on the loan. The loan does have to be repaid at the time or your death or if you sold the home. So instead of leaving your house to your kids, leave them the mortgage to pay back.
I don’t have the time to go into the pros and cons of getting a reverse mortgage, but there are several sources online to get good information. The largest source of reverse mortgages are from the Dept of HUD (www.hud.gov) or you can go to the website for the AARP (www.aarp.org) and search reverse mortgages. Or just Google reverse mortgages.
I’m sure you all are aware that Mr. Ed McMahon has recently suffered some financial trouble and was about to lose his 6 bedroom home to foreclosure. Well Ed has apparently escaped foreclosure and has found a buyer for the property.
It was reported that Donald Trump would help out the McMahons by either buying the home or assuming the mortgage balance, but it appears that the buyer is not Mr. Trump. The full details of the sale are unknown at this time.
I’m sure Ed was feeling some relief, but it was only short lived. He has just been sued by a company previously owned by the late Merv Griffin for a sum of $100,000 for defaulting on another loan.
Source: usmagazine.com