Real Estate Information

Septic Betterment Program from Town of Ipswich website; 

INTRODUCTION

The Town of Ipswich invites those in need of septic system repairs or replacement to apply for a Loan under the Town’s Septic Management Betterment Program. The proceeds of a loan from the Massachusetts Water Pollution Abatement Trust and the Massachusetts Department of Environmental Protection are being utilized to help homeowners comply with Title 5, 310 CMR 15.000 of the State Environmental Code. This will be done by repairing or replacing failed on-site sanitary sewage disposal systems or providing connections to the municipal sewer system. The goal of the Betterment Program is to protect the public health, safety, welfare and the environment through the repair, replacement and/or upgrade of failed systems.

GENERAL PROGRAM DETAILS

The Betterment Program is offering a 2% interest loan with a maximum 18 year payment plan. This allows homeowners to repair their septic systems through the payment of a betterment. There is no credit check required, although all municipal accounts must be paid up to date. Only homeowners that are certified by the Tax Collector’s Office and Utilities Department as showing no outstanding balances due are eligible for the Betterment Program.

The loan application is processed under the direction of the Health Agent/Program Administrator. Loan payments must be made annually with the third quarter tax assessment to cover the amount of the loan plus 2% annual interest.

More information can be found in these documents: Betterment Program Information , Sample Betterment Agreement .

WHO IS ELIGIBLE?

All Ipswich households will be eligible to participate. Evidence of a failed system must be presented through an Official Title 5 Inspection Report completed by an Ipswich permitted System Inspector.

HOW DO I APPLY?  To obtain an application you may download it from the Town of Ipswich website or call the Health Agent during Town Hall operating hours at 978.356.6606.

Homeowners received two little-noticed gifts from the fiscal cliff deal signed by President Obama on Jan. 1. That congressional agreement, called the American Taxpayer Relief Act of 2012, restores a pair of treasured tax breaks previously lost to homeowners.

One is the federal tax deduction for mortgage insurance premiums. The other is a tax credit that lets homeowners take up to $500 off their federal income tax for making certain improvements that increase the energy efficiency of their homes.

Bloomberg makes the point that restoring these tax perks was a triumph for the extremely powerful housing and mortgage insurance lobbies. These two breaks, together with decisions to preserve tax exemptions for home sale profits and mortgage debt forgiven in foreclosures and short sales, could total $600 billion over the next five years.

Deduct MI premiums again

If you pay mortgage insurance, you know that deducting it is the next best thing after being able to cancel it (when the loan balance drops below 78% of the home's value and you've made at least 60 payments). Congress snatched away the deduction at the end of 2011 but gave it back with the stroke of a pen in the Jan. 1, 2013, deal.

You can use the deduction on your 2012 and 2013 federal taxes. It applies to private mortgage insurance premiums as well as Federal Housing Authority and Veterans Affairs premiums.

Restoring the deduction for those two years will cost taxpayers $1.3 billion, says The Associated Press. 

Bloomberg says about 3.6 million taxpayers used the deduction in 2009 (the latest data available). "They deducted almost $5.5 billion in premiums, for a total tax benefit of more than $700 million, according to the National Association of Homebuilders in Washington."

To enjoy this restored benefit, you'll have to itemize deductions on your federal income tax, said MSN Money tax expert Jeff Schnepper, reached by email. "That means, assuming you don't take the standard deduction, your maximum benefit is 25% of whatever you pay in mortgage insurance premiums."

The deduction is for taxpayers earning less than $110,000 a year, says Mortgage Insurance Companies of America, a trade group.

FHA rules about to change

Government's and lenders' rules require mortgage insurance for homes bought with a down payment of less than than 20%. MICA, the trade group, says that roughly 29% of home loans have mortgage insurance. Of that, 9% is private mortgage insurance, 13% is FHA mortgage insurance and 7% VA coverage.

Heads-up: Buying an FHA-insured home is about to become more costly, by the way. Not only are FHA premiums rising to replenish the insufficient FHA insurance pool but FHA is putting an end to homeowners' ability to cancel their insurance once they have a 78% stake in the home. 

No date has been set for the change, HUD spokesman Lemar Wooley said by email. He expects an announcement by March 31 or sooner. Once the change goes into effect, you'll pay mortgage insurance on an FHA loan for as long as you own the loan. The change does not affect FHA loans made before then, though.

Credit for green improvements

And now for that tax credit on energy-frugal improvements. A credit -- unlike a tax deduction, which lowers your taxable income -- is simply money taken off the amount you owe the IRS.

Residential energy tax credits have been available for several years for improvements and appliances that improve a home's energy efficiency. (The program has a tortured history. See it here at the Alliance to Save Energy.)

The tax credit is typically 10% -- up to a total of $500 -- for purchasing and installing certain products. But a few eligible products have specific credits, $300 for an electric heat pump water heater, for example.

What's eligible

The credit can be used when you purchase a qualified new water heater, furnace, boiler, heat pump, central air conditioner, insulation, windows or roofing for your home. Circulating fans are eligible when they're used in a qualifying furnace. Biomass stoves that use qualified fuel also are eligible.

As you may have noticed, "eligible" is the important word here. The Alliance to Save Energy explains how to find out which appliances are eligible. The Database for State Incentives for Renewables & Efficiency also offers a rundown of the credit.

You claim the credit for the tax year in which the appliance was installed (not purchased). You can use the tax credit only if you haven't claimed it before (in any year). File IRS Form 5695  along with your income tax to claim the credit. Here's how the IRS describes the credit.

Extending the credit for 2012 and 2013 will cost taxpayers $2.4 billion, according to the AP. 

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Mood of the Market

The fields of behavioral economics and behavioral finance are a couple of 21st-century mashups, academia-style, blending observations about the often-irrational financial decisions people make (which, writ large, become economic trends) with insights from the behavioral sciences, from anthropology to psychology, and beyond.

Though these disciplines originated in the ivory tower, they have, in turn, given birth to a number of findings, insights and even mandates for every homebuyer who wants to optimize the dozens, maybe even hundreds, of decisions they'll face at every point on the path to purchasing a home, from when to buy to how much to offer to what type of mortgage to take.

Here are the four most powerful behavioral economic and finance insights with real estate implications, and how you can apply them to level up your own home buying decision-making:

1. Observing willpower basics can help you avoid overspending.

In real estate, overspending can mean any of several things, but there is one definition that is particularly insidious, and it's the simplest: spending more than you can truly, sustainably afford to!

This happens because, over the years, buyers have grown to conflate their lender's decision on how much they can spend with their own decision to make about how much they can afford to spend.

It's like confusing your credit card limit with what is responsible to spend.

Willpower researchers have found that not only does the elusive ability to exercise self-control in the face of temptation actually exist, it can be fostered in some relatively simple ways. This is good news for homebuyers in today's hot market, where multiple offers and a fear of missing out on good deals can create that auction atmosphere that causes otherwise sane and sober spenders to throw every cent they can at their target home.

The theory of ego depletion says that willpower is finite, and can be depleted by putting too many demands on it at once. So, rather than trying to diet, stop biting your nails and start a new cardio regimen all at the same time, most people do better making one willpower-sapping change at a time.

And the same goes with homebuying: If you've had a day where you went to great lengths to bite your tongue to avoid snapping at your kids, and you also had to turn down Girl Scout cookies and birthday cake carbs at work all day, it might not be the right night to decide how much to offer on your home. Instead, ask your agent to connect with the listing agent and let them know to expect an offer in the morning.

Similarly, avoid letting yourself get too hungry or binging on sugary treats during the stress of your house hunt; willpower requires brain glucose, so super-hungry house hunters or those on a sugar rush/crash cycle are liable to make poor decisions at offer-price decision time.

2. Ditch the herd.

Everyone wants to buy low and sell high, especially when buying a home. The challenge is that we all have an innate fear of missing out on both bargains and profits. Our inclination to act on this fear is exacerbated when we hear stories of the steal that our cousin got on a foreclosed home at the bottom of the market, or the cash that is being thrown at our next-door neighbor at the top.

Think about it: When prices are cheapest, and on the decline, demand is low and is hard to drive upwards, because people are afraid to buy a home when they think the price might continue to decline. And the opposite is true: When home prices are rapidly ascending, demand is high, and tends to snowball even higher, as people afraid of missing out on value increases and others afraid of being priced out of the market frantically join the herd and buy, buy, buy!

This is precisely why it's foolhardy as a homebuyer to try to time the market just right. Best practice is to buy when the time is right for you, your family and your finances, then to get educated about market dynamics and use them to inform your strategy on how you execute your purchase, like what price range and area to target, how much to offer and when to lock your interest rate.

3. Overconfidence and real estate are a deadly combination.

Behavioral finance researchers and theorists have devoted a lot of attention to overconfidence: the tendency of some investors and financial professionals to overestimate their ability to pick stocks, trade profitably or otherwise succeed at a given task. In the realm of traded assets, overconfidence cause all sorts of simple, yet potentially catastrophic, behaviors, like making excessive trades, which has been correlated to big time losses over time.

And overconfidence is just as deadly in real estate: Homebuyers who incorrectly gage their own bargaining power, future finances or fix-it prowess can and often do end up in what my mom would call "a world of hurt."

• Lowball offers or other negotiating strategey (no typo) can result in lost home after home, all while prices go up and your energy and enthusiasm go down.
• Making mortgage obligations with overly optimistic hopes for your future income or the home's appreciation is exactly what got the last generation of homeowners in trouble.
• And buying a major fixer when you have no money to hire a contractor and you've never even had any interest in owning, much less swinging, a hammer? It's a recipe for disaster. Didn't you ever see "The Money Pit"?

4. Don't let loss aversion make you forget what you can truly afford.

There is an interesting imbalance in most of our brains, when it comes to our financial decisions: We are more afraid of losing money (and financial opportunities) than we are attached to acquiring gains. That is, our fear of loss is much, much greater than our emotional attachment to potential profits.

In homebuying, this most often manifests when house hunters lose their minds and cut the purse strings entirely to secure a hot home in a hot market. This is the same mindset that has kept homeowners stuck in homes in depressed markets: Some unemployed and underemployed homeowners have even forgone great job offers in other areas, committed to spending what might be dozens of years in the very worst local economic markets, all to avoid short-selling the place and taking a loss.

I've seen people do very, very scary things out of loss aversion, from simply (but devastatingly) overextending themselves to buy homes they can't afford without endangering their financial well-being, to taking mortgages they knew would adjust problematically in 12 months. What's even more dysfunctional, though, is avoiding the "loss" of a target property by taking gifts and loans from relatives who you know upfront will be less than cheerful givers and who you know upfront will never let you hear the end of it.

Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.

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Copyright © 2012 RISMedia. All rights reserved.

Massachusetts Home Sales hits a ‘Baker’s Dozen’ in July with 13 Straight Months of Increases as median prices also tick up REALTORS® support new short sale guidelines for Fannie Mae and Freddie Mac

WALTHAM, Mass. – August 29, 2012 – The Massachusetts Association of REALTORS® (MAR) reported today that July marks the 13th straight month that single-family home sales have gone up compared to the same month the year before. Condominium sales were also up from July 2011. Both single-family and condominium median prices were up compared to last year.

“While we’ve hit a ‘baker’s dozen’ with months of sales increases now at 13, prices continue to stabilize,” said 2012 MAR President Trisha McCarthy, broker at Keller Williams Realty in Newburyport. “The probability that home prices will begin a more steady increase is good if the combination of higher buyer activity and lower inventory levels continue. What is needed are more sellers at all levels to insure that price increases happen at a more reasonable pace than during the bubble years.”

There were 4,709 detached single-family homes sold this July, a 22.7 percent increase from the 3,837 homes sold the same time last year. This is the 13th straight month of year-over-year increases. On a month-to-month basis, home sales were down 13.2 percent from 5,422 homes sold this past June.
The median selling price for single-family homes in July was $325,000, which was the up 1.9 percent from $319,000 in July 2011. On a month-to-month basis, the July median selling price was down 1.1 percent from $328,500 in June 2012.

The July condominium market was up 23.1 percent compared to the same time last year (from 1,468 units sold in 2011 to 1,807 units sold in 2012). This is the 12th month of the last 13 that condominium sales have been up. On a month-to-month basis, condominium sales were down 16.6 percent compared to the 2,167 units sold this past June.

Condominium median selling prices in July were up 4.2 percent from the July 2011 median price (from $288,000 to $300,000). On a month-to-month basis, the median selling price of a condominium was down 3.8 percent from a June 2012 median of $312,000.

New Short Sale Guidelines for Fannie Mae and Freddie Mac:
REALTORS® in Massachusetts and across the country support the recent announcement made by the Federal Housing Finance Agency that Fannie Mae and Freddie Mac are issuing new and clear guidelines to their mortgage servicers that will align and consolidate existing short sales programs into one standard short sale program. These changes are scheduled to go into effect on November 1, 2012.
“There is nothing ‘short’ about a short sale and anything that can streamline the process and make it faster will help prevent foreclosures and preserve home values in communities across the state is a good thing,” said McCarthy. “We support efforts like these at the federal, state and local level that work to stabilize the market and help homeowners that are having financial difficulties through no fault of their own.”

One of the most important features of these new guidelines is that Fannie Mae and Freddie Mac will permit a homeowner to sell their home in a short sale even if they are current on their mortgage if they have an eligible hardship. This is a significant change as in most instances; a homeowner has to be at least 90 days late on their mortgage payment to begin the short sale process. As a result, because of the length of time it takes for short sales to be approved, the home often goes into foreclosure.
Inventory and Days on Market:

The inventory of single-family homes as of July 2012 decreased 16.6 percent from July 2011 (34,337 listings in 2011 to 27,622 listings in 2012) which translates into 7.7 months of supply in July 2012. This is down from 11.3 months of supply last year and also down slightly from 8.3 months in June 2012. Inventory has gone down eight of the last 10 months. This was also the largest single month year-over-year decrease since 2007.

The inventory of condominiums on the market in July was down 29 percent compared to the year before (11,974 listings in 2011 to 8,497 listings in 2012), which translates into 6.3 months of supply, which is down from 10.1 months in July 2011 and down from 6.9 months in June.

Detached single-family homes stayed on the market an average of 98 days in July 2012, which was down one day from 99 days in July 2011. Condos stayed on the market an average of 93 days, down from an average of 100 days in July 2011. On a month-to-month basis, days on market for single-family homes were down from 104 days in June while condos were down from 96 days.

About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000 members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.

With heating and cooling costs continuing to rise, it makes sense to look at one of the leading causes of energy inefficiency in the home: the windows. Installing energy-efficient windows can mean increased comfort as well as savings on utility bills in any climate.

The transmission of air and light is generally the most important function of windows. However, this can mean heat loss in the winter, overheating in the summer, and higher energy bills. A typical home may lose up to 30% of its heat or cooling through windows. Properly installed energy-efficient windows can go a long way toward improving this situation.

There are many factors that affect a window's energy efficiency. Whether they are single or multiple-paned, gas-filled, Low-Emittance (Low-E) coated, and even the material of the window frame all contribute to a window's performance. One excellent resource is www.efficientwindows.org, which provides detailed information on these specifications and how to select windows appropriate for various climates. An experienced window contractor can also be a good source of information and recommendations.

Homeowners should check with their local utility to find out about possible rebates and other incentives for the purchase of new, energy-efficient windows.

Of course, replacing windows is not always a viable option. However, there are steps homeowners can take to improve their energy savings without replacing windows such as making sure windows are properly caulked, keeping weather stripping in good repair, and using storm windows will help. Putting window coverings is another good way to reduce heat loss in winter and avoid overheating during summer.

Improving energy efficiency throughout the home means cost savings to the homeowner. Energy-efficient windows are a significant step toward that goal.

Pillar to Post

Did you know that:

1.  that all plastics number 1 to 7 can be recycled?

2.  that you can recycle glass, cans, cardboard and paper  as well as

3.  newspapers, magazines

4.  junk mail and envelopes and

5.  OJ or milk cartons

6.  you can put latex paint dried out into your regular trash?

Check with your town as to when leaf collection is:  usually mid-November.

Other approaches for recycling include:

1.  construction waste:  Mellow Disposal of Georgetown, MA (978.352.9948)/pay be weight.

2.  household hazardous waste:  call your town's health department

3.  for appliances and metal items that you are not able to get to a Transfer Station, call JRM to pay with credit card and schedule pickup at 978.536.2500.