Yesterday at the Women’s Council of Realtors Luncheon I heard about a new loan program designed for professionals. This program applies to resident or practicing physicians, attorneys, oral surgeons, CPAs, CEOs, CFOs, CIOs, COOs or chairmen of publicly traded companies, or executives in direct report to the CEO. The program allows for zero down loans up to $1M, and no mortgage insurance. At a time when it is difficult for many people to qualify for a mortgage, and zero down is just about non-existant, this program is unusual. Certainly a new physician just starting out might not have the savings to buy a house, so this allows him/her to go ahead and do so. But for CEOs and the other categories, it would seem they would have savings for a down payment. But, perhaps this type of loan will help stimulate home sales. I hope that’s the case. Contact me for further details. Vikki Goodwin, REALTOR, Homes ATX, 512-426-9090.
Filed under: Real Estate | Tags: Austin real estate, lake area homes, Lake Travis, Lakeway, new construction
Yesterday I was out previewing Lake Travis area condos for a client. Here’s what I found. The Pinnacle at North Lakeway is a new complex under construction by Ryland. They are just getting started and need to motivate buyers, so they have some really great prices on their new construction. The models are beautiful and they have 2 units just about complete, another 2 that will be ready in about 6 weeks, and more that are getting started. There are 3 floor plans to choose from and some will have nice views, especially from upstairs windows. The condos are set within a large single-family residential neighborhood that should be a desirable place to live. Since they are just getting started, construction will continue for some time, which can be noisy and dirty. While the prices in the MLS are good, those are base prices and upgrades will bump the prices up. The sales representative told me 2 units sold last weekend, and he indicated sales are doing well, so they may raise the prices.
Another newer condo complex off 620 is the Enclave at Alta Vista built by Toll Brothers. This is a nice neighborhood that is nearing completion, so construction noise and dirt are not an issue. The condos have nice finish out, great views, and all the amenities (pool, club house, gym, tennis courts, etc.). Since the Toll Brothers name carries some prestige, the prices are much higher per square foot. There’s just a few condos still available in this section, but it looks like they are working on another section.
A third new construction condo complex is The Vistas at Lakeway – also by Toll Brothers. While this neighborhood is similar to the Enclave at Alta Vista, right now it has no amenities. The prices are slightly lower than the Enclave at Alta Vista, but they are still high compared to Pinnacle. I don’t like the entryway to the neighborhood – commercial that isn’t very attractive. This community doesn’t have as nice a view as the Enclave.
I also looked at some resale condos in the Lakeway area, a few in the Courtyard at the Preserve, a few in Lakeway and one in the Hills of Lakeway. One of the condos is a detached condo at 15405 Joseph that is more like a house than a condo. This one features lots of space for the money, and more yard space, too. However, there are no upgrades, and yard maintenance isn’t included in $110/mo. HOA fee.
The other 4 condos I previewed are:
1) 410 Hummingbird Ln #2 – beautiful finish out, beautiful entryway and courtyard in front, situated right next door to CenterPointe Sales Office which might not appeal to homeowners. I don’t know the reputation of this builder. The living room and dining room are spacious. Nice view from upstairs.
2) 1209 Delsie Dr – too much road noise here and view of commercial building across the street is a negative.
3) 211 The Hills Dr #9 – $151/sq ft is too high even if it is located in “The Hills”. Prestigious neighborhood and nice house, but seems small compared to others.
4) 427 Seawind – interesting, 1970s condo that has been completely updated. Across the street from Live Oak Golf Course. Eclectic neighborhood.
I recently attended a presentation on the topic of subprime mortgages by a professor at the University of Texas. He provided a very clear explanation of how subprime loans came about and how they ended up causing so many problems. In his opinion, one reason for the invention of the subprime loans was not only a demand from people wanting to buy homes, but also a demand for investment securities. Banks don’t hold onto mortgage loans – they sell them in order to have enough cash to make more loans. And instead of selling the loans individually, they bundle them and sell them as a package. Because of the demand, the bundles are then “sliced and diced” creating more securities that can then be sold to more investors. So, the subprime loans were introduced to feed the demand. Without going into the details, rating the amount of risk involved in the bundles becomes important, and the rating system could have some flaws. Because the demand for investments is so great, more slicing and dicing goes on creating “CDO”s or Collateralized Debt Obligations (if I’m recalling correctly). Basically, the factors involved here are a little bit of greed, a lot of ignoring the risks, and another little bit of desire for home ownership even when it’s not advisable. (Are you aware of the “Ninja” loans? These are made to people with “No Income, No Job and No Assets”. Does that seem advisable?!)
Mixed in with the above is the fact that as home prices increased in some markets, lenders were allowing buyers to use a higher percentage of their income on their mortgage (at least they could qualify for a higher price based on higher ratios). And at the same time, banks were being allowed to loan out a larger percentage of their funds – overleveraging. Now that we’ve seen the problems with CDOs and subprime loans, can investors be satisfied with lower returns on safer investments? Do we need to change the way risk is rated? Should a lower percentage of the population be homeowners? And will we run into this problem again?
We may have no choice. Subprime loans have all but disappeared, so you can’t slice and dice thin air… Prime loans are safer, so with that being what remains, investors will have to be satisfied with smaller returns, at least for some time. Yes, I think we need to re-evaluate the rating system. And yes, history has shown that a good balance equates to 62% of the population owning their homes. Right now, 68% own their own homes, and many just by a hair. Finally, I do think we’ll run into this problem or one that is similar. History just has a way of repeating itself…
Filed under: Real Estate | Tags: Austin, Austin homes, Austin real estate, Real Estate, South Austin real estate, SW Austin
I recently viewed this home with a young couple moving from Alabama to Austin. This was their second choice. They loved the backyard which looks out to the tree-filled greenbelt behind the house. The huge deck is also very attractive and inviting. When you go upstairs, you again have a beautiful view of the greenbelt from the open gameroom at the top of the stairs. The home is brighter and more welcoming than the photos indicate. Priced at $239,900, this home is a great deal in my opinion. It has 2310 sq ft and was built in 2002. Call for showings, Vikki Goodwin, Homes ATX, 512-426-9090.
