NOVEMBER 2010

How Important are FICo SCoreS?GGar market overvIewHolIday deCoratIonS tHat Sell your Home

Let’s Be Thankful for Positive Housing News

Foreclosurehalt may be helping Housing

!"!"!"#$%#"&!"##'()**#&$++,-)$%),'&,.&"#$*%,"+" $/!/+%&0112

!"#$%&%'()'*$'*+*,%-+.$$.$/'3456& 478584& 9:;3<56=78>& ?65<@A4&01*$23'*$%'45&'6",7&,'809'"6'45&':,24';#(<.=<)-5&<%'=",;",*-8=:<&8:&B;8&3456&478584&6=78=<C7&:<& 8A4& )<843<48>& D:A<& !=5=E:>&&1*$207&%.*' .2' 45&' <&*%.$/';,"1.%&,' "6' ;,"-="$2#7&,3'=#24"7',&*<'&24*4&'$&+2'*$%'=<F:3E58=:<&@:<84<8G

>2?'01*$2' .2'*';,"<.:='="<#7-$.24'*$%'*#45",'"6',&*<'&24*4&'7*4&,.*<3'.$=<#%.$/'45&'@*4."$-56&$77:@=58=:<&:F&"#$*%,"+H&

A#.%&'4"'B"7&'C#).$/3'*$%'A#.%&'4"'B"7&'D&<<.$/?'D5&'.2'*';";#<*,'7&%.*';#$%.4'*$%'E&)$"4&'2;&*E&,3'*$%'+*2'$*7&%'*2'"$&'"6'45&'FGH'>"24'I$J#&$4.*<'K&";<&'I$'L&*<'024*4&M'()'

L0NOP9LQ'>*/*R.$&3'45&'"$<)'+"7*$'4"'%*4&'4"'7*E&'45&'F$"4*(<&2M'",'*("1&'45,&&'4.7&2?

&1*$207&%.*' .2' 6"#$%&%' "$' 45&' (&<.&62' 45*4' *' ;,"6&22."$*<'L0NOP9LQ'.2'*'(#)&,S2'",'2&<<&,S2'(&24'*22&43'*$%'45*4'"+$-.$/'*'5"7&'.2'45&'7"24',&+*,%.$/':$*$=.*<'*$%';&,2"$*<'.$-1&247&$43'+5&$'="$2#7&,2'=5""2&'+.2&<)'*$%'+.45.$' 45&.,'7&*$2?'!",'7",&'.$6",7*4."$3'1.2.4'&1*$2&7&%.*?="7?

T&<="7&'4"'45&'N#/#24'GUUV'&%.4."$'"6'>*,E&4!"#$%3')"#,'6:@56&3456&478584&4E5C5I=<4J

P5&'A,&*4&,'A,&&$1.<<&'N22"=.*4."$'"6'L0NOP9LDQ'*$%'.42'7&7(&,2'*,&'4*E.$/'45&'";;",4#$.4)'4"';,"1.%&'45&'#;24*4&'="77#$.4)'+.45'4.7&<)'.$6",7*4."$'*("#4'+5*4S2',&*<<)'5*;-B4<=<C&=<&8A4&6:@56&3456&478584&E53K48G&

T&'*,&';<&*2&%' 4"'(,.$/' )"#'#;%*4&2'"$' *'7"$45<)' (*2.2'+5.=5'+.<<'5&<;'%.2;&<'2"7&'"6'45&';&,1*2.1&'7.2="$=&;4."$2'

8A58&:;3&E53K48&=7&7;FF43=<C&8:&8A4&75E4&4L84<8&57&:8A43&E53-E&42'*,"#$%'45&'="#$4,)?'P5*4'.2'%&:$.4&<)'$"4'45&'=*2&?'P5&',&*<'&24*4&'(#2.$&22'.2'()'.42'1&,)'$*4#,&'<"=*<3'*$%'"#,'="7-7#$.4)'.2'6",4#$*4&'4"'5*1&'7*$)'&="$"7.='="$%.4."$2'.$'.42'6*1",'*2'+&<<'*2'*'(*<*$=&%'*$%'24&*%)',&*<'&24*4&'7*,E&4?

D;78&57&8A434&=7&<:&<58=:<56&M458A43&F:34@578>&8A434&=7&<:&<5-4."$*<',&*<'&24*4&'7*,E&4?'9#,'/"*<'.2'4"'(,.$/')"#'$&+2'*$%'.$6",7*4."$' *("#4' <"=*<'7*,E&4' ="$%.4."$2' )"#' =*$'#2&' 4"'7*E&'+.2&'5"7&(#).$/'*$%'2&<<.$/'%&=.2."$2?'T&'5";&')"#'&$W")'45&'24)<.25'6",7*4'*2'7#=5'*2'45&'%*4*3'*$%'*2'7#=5'*2'+&'&$W")'(,.$/.$/'.4'4"')"#?

L&7&7(&,'&1&,)'7*,E&4'.2'<"=*<3'="$2#<4')"#,'L0NOP9LQ'4"%*)X

CON@8B0'0YN@D3'!9Z@[0L

#$%&'"N53K48!"#$%&N'K#(<.=*4."$'"6'45&'A,&*4&,'A,&&$1.<<&'N22"=.*4."$'"6'L0NOP9LDQ

#$%&'"()*+,-.(/0*1"2+34

2 | GREATER GREENVILLE ASSOCIATION OF REALTORS

Welcome to the NOVEMBER 2010 edition of MarketClick, your local real estate emagazine! 4

681012

NOVEMBER 2010

MarketClick | NOVEMBER 2010

GREATER GREENVILLE ASSOCIATION OF REALTORS | 3

contents4681012

How Important are FICo SCoreS?

ForeCloSure Halt may be HelpIng HouSIng market

let’S be tHankFul For poSItIve HouSIng newS

Holiday decorations tHat sell your Home

GGAR MARket OveRview

NOVEMBER 2010

NOVEMBER 2010 4 | GREATER GREENVILLE ASSOCIATION OF REALTORS

Holiday decorations can make a home look warm, festive and inviting, but they can also make it look overcrowded, or obscure your

home’s best selling features.

The holidays can be an ideal time to market a home. Families making a move during the holidays are typi-cally relocating from other areas, and they have to move fast. First impressions count with these moti-vated buyers.

But they’ll only choose your home if it looks move-in ready, so make sure that your home’s features are showcased to advantage.

While celebrating the holiday season with your fam-ily is important, this year, your priority is to sell your home.

Don’t put decorations out too soon, and don’t leave them up too long. If you decorate, wait until after Thanksgiving and commit to taking your decorations down by the first weekend in January.

During the holidays, your home may look its loveli-est, but it gets cluttered easily with wrapping paper, gifts, invitations, greeting cards, and more. Designate an extra bedroom or some other space out of main traffic areas for wrapping gifts and making decora-tions.

Think of activities you can do with your family outside the home, like going together to shop for a Salvation Army “Angel,” or volunteering at a soup kitchen. Keeping decorations to a minimum. If your home

sells quickly, it will be that much easier to repack them.

Use holiday decorating to showcase the home’s fea-tures, with items that can be thrown away. A small garland of holly can easily accent a fireplace, or a bou-quet of mistletoe can bring attention to a beautiful archway. Both can be discarded instead of packed af-ter the holidays, or on moving day.

If you have a Christmas tree, make sure it’s not an ob-stacle to traffic patterns. If your tree overpowers your room, it can make the space appear too small, which discourages some buyers.

Try not to use breakable decorations. You don’t want buyers distracted by stepping around packages, or fearful of knocking ornaments down. Also, live trees must be kept watered so they don’t shed needles, or turn dry and brittle.

If you must have a tree, consider moving some fur-niture into storage so the space around the tree isn’t cramped. Buyers are not always able to subtract fur-nishings and decorations when remembering room size. They can only remember that they were com-fortable or uncomfortable.

When you sell your home, you’ll be glad you saved yourself the extra work of too many decorations. Save your energy for packing and moving! t

Holiday Decorations that Sell Your Home

NOVEMBER 2010 GREATER GREENVILLE ASSOCIATION OF REALTORS | 5

[To Buy? continued on pg 14]

NOVEMBER 2010 6 | GREATER GREENVILLE ASSOCIATION OF REALTORS

If you want to take advan-tage of today’s low interest rates, you must have at-

tractive enough credit scores to qualify.

When you see news stories that say mortgage interest rates are down to 4.28%, as they were the day this editorial was writ-ten, that attractive rate is for a benchmark 30-year, fixed-rate mortgage.

What that means is that the rate is only available to those whose credit scores are high. High scores indicate high levels of responsibility, making the borrower a better candidate for a loan.

Credit scores are basically a way for banks to manage risk in lending. Back in the 1980s, The Fair Isaac Company devel-oped software that issues credit scores, a number that indicates your level of creditworthiness. The number is based on the evaluation of your credit report criteria, including but not limited to: How much credit you useHow wisely you use credit (payment history) Your debt-to-income ratioCredit inquiries

Defaults, bankruptcies, liens, judgments, etc.

All three credit-reporting bureaus, Experian, Tran-sUnion and Equifax use the software to determine your credit “FICO” score. It’s possible to have three different credit scores because the credit bureaus have inconsistent data about you.

How Important are Scores?

NOVEMBER 2010 GREATER GREENVILLE ASSOCIATION OF REALTORS | 7

How Important are Scores?

You don’t automatically get a FICO score when you request copies of your credit reports, but your bank does. Credit scores are shorthand – instead of taking the time to read your credit report, they use the credit score. To them it tells your story.

According to MyFICO.com, FICO scores range from 300 to 850, the higher the better.

Payment History – 35% Total Amounts Owed – 30% Length of Credit History – 15% New Credit – 10% Type of Credit in Use – 10%

When you apply for a mort-gage, the bank uses your social security number to look up your credit reports and scores. They base their decision to lend to you, plus how much in-terest they charge you, on your scores.

The best loan rates go to the borrowers with the best credit histories. As you can see from the FICO break-down, most banks will be interested in how much you owe and whether you pay on time.

You can get a loan with lower scores, but expect banks to re-quire more money down, and to lower the amount they’ll loan you on a home so you

can keep your debt-to-income ratio lower. And, they’ll charge you higher interest rates.

So if you want that 4.28% interest rate, take good care of your credit.t

8 | GREATER GREENVILLE ASSOCIATION OF REALTORS NOVEMBER 2010

GREATER GREENVILLE ASSOCIATION OF REALTORS | 9NOVEMBER 2010

[Be Thankful continued on pg 14]

Let’s be Thankful for Positive Housing News

As the nation counts its blessings this Thanksgiv-ing, homeowners, buyers and sellers have much to be thankful for. The economy is still shaky,

but recent news is positive for the housing market – from record low mortgage interest rates to rising sales.

With employment numbers stubbornly fixed at 9.5% nationwide, the Federal Reserve held overnight bank interest rates steady in October. Lower U.S. Treasury yields followed, hitting lows not seen since January 2009.

Mortgage interest rates, which mimic bond yields, fell to all-time lows in mid-October, according to the week-ly Freddie Mac survey. Benchmark 30-year fixed rate mortgages for borrowers with good credit have stayed under 5% for 23 consecutive weeks. The last time these rates reached 4.19% was in April 1951.

Such low interest rates have stimulated the housing mar-ket. Following a dramatic dip in sales volume after the

expiration of the federal home buying tax credits, both the National Association of REALTORS® (NAR) and the Commerce Department reported improvements in August and September.

Existing home sales rose 7.6% in August, and home prices were up 0.8% year-over-year, but the gain was even better for September – up 10.0%. That’s 19.1% be-low a year ago, when first-time buyers were “ramping up in advance of the initial deadline for the tax credit last November,” explained the trade organization. To put that news in perspective, affordability is terrific. Accord-ing to the NAR, home prices are about 22% less than where they were five years ago at the peak of the housing market, and 10 years ago, mortgage interest rates were nearly double where they are today.

Housing supplies are coming back down again. In Sep-tember, supplies fell 1.9% to a 10.7-month supply from a 12-month supply in August. That’s 4.04 million homes t

10 | GREATER GREENVILLE ASSOCIATION OF REALTORS NOVEMBER 2010

foreclosure halt may be HELPING the housing market

In Q-3 2010, the zeal for foreclosure sei-

zures reached record levels – one in every 139 homes, accord-ing to RealtyTrac, and foreclosures topped 100,000 in the month of September for the

first time ever.

To handle the load, banks employed “robo-signers” to push paperwork through, but irregularities were found to be so widespread that attorneys general in 49 states, except Alabama, have launched a joint investigation and called for new processing methods that better pro-tects consumers.

Major banks issued a temporary moratorium on fore-closures. While it’s unknown how many mortgages are affected, the moratorium produced at least two short term effects.

Fewer depressed homes are on the market. Competing against fewer homes for sale is always posi-

tive for sellers, but it’s even better that there are fewer homes on the market with depressed prices.

Foreclosed homes can sell for as much as 27% off list price, according to a recent study of Massachusetts foreclosed homes by MIT and Harvard researchers. Neighboring home prices are lowered by one percent just for being in proximity. See: http://web.mit.edu/press/2010/housing-prices.html

With approximately 2.5 million homes in some stage of foreclosure in 2010, neighboring home prices will suffer about $7,217 in value, according to estimates from the Center of Responsible Lending in 2009. See: http://www.responsiblelending.org/mortgage-lend-ing/research-analysis/soaring-spillover-3-09.pdf

Homebuyers have reason to shun foreclosures. Home-buyers may be reluctant to pursue foreclosed proper-ties due to potential problems with paperwork and obtaining clear title.

Buyers who are either under contract or hoping to buy a foreclosure bargain are in limbo. While it’s unlikely that delinquent borrowers will be allowed to keep their homes, it’s clear that the stock of foreclosed homes will remain unoccupied for the short term, possibly bring-

NOVEMBER 2010 GREATER GREENVILLE ASSOCIATION OF REALTORS | 11

[Better continued on pg 14]

[To Sell? continued on pg 14]

ing neighborhood values down even further.

Currently, more than 14 million homes, out of about 130 million are standing vacant, says Karl Case, co-founder of the Case-Shiller Housing Price Index.

A quick solution is imperativeAny situation that inhibits or blocks buyers is un-healthy for the housing market and the nation’s eco-nomic recovery, says the National Association of REALTORS®. Some transactions are already being de-layed, and some foreclosure listings are being removed from the market, creating new anxiety for homebuyers and sellers.

If you’re a buyer who has purchased a foreclosed home, you have little to worry about, as foreclosures are un-likely to be reversed.

If you’re trying to buy a foreclosure, you have no choice but to be patient for a few weeks while the banks sort things out, or move on to another property.

Keep in mind that your chances of getting a loan

are much higher if you can qualify for a conventional or conforming loan.

If you’re a seller, now’s the time to price your home to sell while inventories are reduced from the temporary absence of foreclosures.

Homeowners can protect their home values by being proactive.

Urge your local housing authority to make sure the foreclosed homes lawns in your area are maintained, with lawns mowed, broken windows repaired, and other maintenance and security performed.

Offer help to older neighbors or neighbors who have lost their jobs.

Your home is part of a neighborhood, and neighbors are all impacted by each others’ property. Remember, a buyer can’t tell from looking if a home is foreclosed, but they can certainly tell if it’s poorly maintained.t

12 | GREATER GREENVILLE ASSOCIATION OF REALTORS NOVEMBER 2010

GGAR MarketOVER VIEW

Greater Greenville Association of Realtors

South Carolina was one of 23 states to report lower unem-

ployment rates in Septem-ber, according to the Labor Department. Even better news comes from Upstate, where job gains are among the best in the state.

Greenville County's jobless rate fell to 9%, from 9.8% in August. Anderson County unemployment dropped a whole percentage point, to 10.7%. And Spartanburg County’s rate dropped from 12% to 10.9%.

According to the latest business news, Greater Green-ville unemployment should continue to improve.

Southwest Airlines is adding more routes in Greenville-Spartanburg, starting March 13, to Atlanta as it com-pletes its buyout of AirTran Airways. New flights will also begin to Baltimore/Washington, Chicago Midway, Nashville, Houston Hobby and Orlando.

Relocating to Upstate from Illinois is a vacuum tech-nologies manufacturer called Vac-U-Lok, a vise-sub-stitute supplier that serves the aerospace, automotive, medical, defense and consumer industries. The com-pany is currently relocating its executives and other

employees, upfitting over 4,000 square feet of space, and plans to start recruit-ing machinists, engineers, sales staff, and administra-tors in Q-4 2010.

Brown Mackie College just announced that it is doubling its space in downtown Greenville. The campus opened only a year

ago, but its popular location is proving a big draw to students seeking associate and bachelor’s degrees in business, criminal justice, applied sciences and other majors. Enrollment is jumping by as many as 50 to 100 new students per month.

And Trader Joe’s is the talk of the town. The Califor-nia-based chain boasts 345 grocery stores, and chose Greenville for its first South Carolina location. Bring-ing exotic and rare foods to Upstate and staffed by employees wearing Hawaiian shirts, Trader Joe’s is not your ordinary neighborhood grocer. Join the fun and visit “the traders of the culinary seas” soon.

Upstate homes  And where housing is concerned, homebuyers across the state are still waiting for the green light, including the outcome of foreclosure moratoriums and the No-

GREATER GREENVILLE ASSOCIATION OF REALTORS | 13NOVEMBER 2010

vember elections. Sales volume is weakening, but still ahead of last year by 6.8%.

Yet, the market is still not comparing apples to apples, due to the home buying stimulus in 2009. Sales volume was down 21.9% as of Sep-tember 2010 compared to a year ago. Average and median prices were nearly flat year-over-year, but the homes that sold spent less time on the market than last year.

From January through September 2010, sales volume was up 1.7% from the same period a year ago. The median price was also up 2.1%, from $140,000 to $143,000, and the average price of homes sold was up 3.0% from $168,298 to $173,330.

The market may take another few months to rebalance, but this could also be the calm before the storm, as real

estate sales improve along with the economy.

Buyers should take advantage of near-record low in-terest rates. As the economy shows any improvement, rates rise quickly. Sellers should price homes to sell quickly, giving buyers no excuse to wait for lower in-terest rates or lower prices. t

Greenville SC MLS SOLD 13 Month Trends by Units

0

100

200

300

400

500

600

700

800

900

SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP

SEPTEMBER 2009 - SEPTEMBER 2010

UN

ITS

as of October 10, 2010

14| GREATER GREENVILLE ASSOCIATION OF REALTORS NOVEMBER 2010

for sale.

Again perspective is important. Inventory was high-est in July 2008 at 4.58 million units, so inventory levels are 11.7% below the peak.

Pending sales, or contracts signed for purchase of ex-isting homes, also rose in August, by 4.3%, following a 4.5% rise in July.

In other words, the bottom appears to have passed, but significant improvement in housing is likely to be very slow, largely due to continuing pressure from distressed homes.

Economists see greater demand ahead

According to a survey of leading economists by CNNMoney, the jobs outlook is improving. U.S. businesses are reporting growing demand and in-creased profitability. The October survey by the Na-tional Association of Business Economics stated that employment conditions improved in the third quarter since the start of the recession in 2008.

The National Association of Home Builders (NAHB) expects both the economy and employment picture to improve in 2011 and 2012. Says NAHB Chief Econ-omist David Crowe, “Consumer uncertainty about

the economy, the poor job market and the large num-ber of foreclosed properties for sale continue to be a drag on housing. However, favorable home buying conditions should help spur additional demand as the job market gradually improves later this year. ”

Lawrence Yun, NAR chief economist, says the hous-ing market is in the early stages of recovery. “A hous-ing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclo-sure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers re-sponding to historically low mortgage interest rates and very favorable affordability conditions,” he says.

That positive forecast is echoed by Dr. Mark Dotzour, chief economist for the Real Estate Center at Texas A & M.

“The real economy - economic activity that is not stimulated by tax credits - appears to be turning the corner toward recovery, said Dr. Dotzour. “Corporate profits and new orders for manufacturing have clearly rebounded.”

He cautions, “Job growth is the essential engine of growth in this country. Until we start producing jobs, it’s premature to say we are out of the recession.”t

[Be Thankful continued from pg 9]