Local real estate still moving

Headlines this past week show that housing sales stalled for the fourth straight month nationally, while sales in our market continue to outperform last year. As of this writing our Multiple Listing Service reports that sales in Kootenai County are still ahead of 2009 by 25 percent. This reflects a balancing of statistics that showed the number of sales up 43 percent from last year at the end of February. For the entire MLS our number of sales is 24 percent higher than last year.

What will come in the next few months is hard to predict. The Federal Reserve is scheduled to cease its purchase of mortgage backed securities, an activity which has kept mortgage interest rates down. Then, 30 days later the opportunity for home buyer tax credits will expire. To top it off, the United States Department of Agriculture is quickly running out of money. There is no guarantee they will get more funding before the end of their fiscal year Sept. 30. In 2009, the USDA spent a record $16.2 billion to guarantee 115,981 loans. This year the budget was $12 billion and that money is nearly gone due in large part to the popular, zero down Rural Development program.

Some good news though is that Bank of America took significant steps to help some of its customers by agreeing to reduce the amount owed on their homes by as much as 30 percent. BOA estimates this could help nearly 45,000 distressed home owners that would otherwise be in jeopardy of foreclosure. This is the first time a lender has announced a plan to reduce mortgages when the home's value drops below what is owed.

Since the passage of the health care bill this past week, the Obama administration has turned its focus to the lackluster performance of its loan modification program. As proposed the plan will allow those who owe more than the current value of their home to get new Federal Housing Administration loans. This would require mortgage companies to lower the amount owed by borrowers and would offer three to six months of aid for those who lose their jobs.

Those who can demonstrate financial hardship may be able to get loans as low as 2 percent for up to five years under the plan. So far, Citigroup, Wells Fargo and the aforementioned BOA are on board.

Under the plan incentives will be offered to participating lenders. Additional payments from the existing foreclosure prevention plan ($75 billion) would be offered to banks that reduce payments on second loans like home equity loans.

Now, the silver lining. The USDA is not out of money yet. Interest rates remained slightly under 5 percent last week. Housing is more affordable today than in recent history. There is still 33 days to claim the tax credit.

There is an army of Realtors waiting to help you through the process of buying or selling your home. If you have been waiting for the perfect time, that time could very well be now.

To find a qualified Realtor or to search open houses and information regarding area properties, visit www.cdarealtors.com.

Kim Cooper is a broker and the spokesman for the Coeur d'Alene Association of Realtors. You may contact them by writing to the Coeur d'Alene Association of Realtors, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling 667-0664 with your questions or commentary.