Some cities, mostly in places where the market has slowed significantly in the last year, are offering incentives in the form of tax abatements to help developers unload slow-selling condominiums.

The neighborhoods tend to be pre-gentrification, but the savings can be significant. For instance, the buyer of a two-bedroom condo in a 180-unit development in a former school in Grand Rapids, Mich., will save about $5,300 a year in taxes until 2018. The savings is transferable to a buyer.

Kansas City, Des Moines, Brooklyn, Harrisburg, Columbus, Tacoma, Wash. and Richmond, Va. have dangled similar tax holidays in front of buyers.

Anyone who is buying a condo for investment should read the fine print. In many new projects, developers limit the number of investors to as little as 10 percent of total available units. And that’s despite more lenient standards set by Fannie Mae, which buys many condo mortgages from lenders. Fannie Mae permits an investor-owned level as high as 30 percent.

Source: Forbes, Matthew Swibel (06/04/07)

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Once more there was little movement in the mortgage markets during the week ended May 10, especially for fixed rate mortgages (FRM).

The 30-year FRM averaged 6.15 percent with 0.5 point compared to 6.16 percent and 0.5 point the previous week while the 15-year FRM was unchanged at 5.87 percent and 0.5 points. 

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs averaged 5.89 percent, an increase of two basis points. Fees and points were unchanged at 0.6.

One-year Treasury indexed ARM’s averaged 5.48 percent with 0.7 points. During the week ended May 13 the average was 5.42 percent with 0.7 point.

“Low employment growth in April - the slowest pace since November 2004 - and downward revisions to both February and March job growth tempered market concerns of future increases in the rate of inflation,” said Frank Nothaft, Freddie Mac vice president and chief economist. “As a result, mortgage rates were little changed this week.” Read more

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This is the second installment in a several part series about Second Life, a fantasy web site that is attracting much attention from role players and in the media. Click here to read part one of this series on virtual real estate.

Second Life is an interesting concept if viewed solely as entertainment. Losing one’s Avatar’s ears and clothing is amusing; flying headlong into a Gothic column is painless and pretty funny, and reading the blogs and coming to grips with some Second Life residents’ total commitment to their secondary reality is, well it is massively creepy. But Second Life is also a living, breathing economic system and, for that reason, it is fascinating.

Some of the figures coming out of that economy are startling and the numbers are increasing quickly. In November, 2006 13,788 Second Life business owners earned one dollar or more. These were U.S. dollars (USD) not the Second Life Linden Dollar (L$). Last month that number had grown to 34,474. Granted most had a Positive Monthly Linden Dollar Flow (PMLF) of less than $10 USD but 810 business owners had a PMLF of over $1,000 and 129 made more than $5,000. Read more

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Massachusetts’ property insurers are asking customers to absorb more risk or storm proof their homes.

Ten companies and the state’s insurer of last resort, the Massachusetts Fair Plan, have won or are seeking regulatory approval for higher deductibles that customers along the coast would pay if their homes are damaged by high winds or a hurricane.

These deductibles would be generally 2 percent to 5 percent of a home’s insured value, so that someone with a $400,000 home and a 5 percent deductible would be obligated to pay $20,000 before the insurance kicks in. Read more

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Sales in southern California neighborhoods that offer affordable housing and cater to first-time buyers are in freefall because of tougher mortgage loan standards, which is shrinking the pool of buyers.

Meanwhile, sales of houses in neighborhoods where prices are higher than $600,000 continue to be relatively brisk, according to an analysis of sales data by DataQuick Information Systems.
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NEW YORK · Like the legions of aspiring poets, tap dancers and musicians who came before her, Nina Rubin, 29, a graduate of Wesleyan University, has struggled to find decent housing in New York. Earlier this year, she ended up in her most unusual home yet: an office.

After taking a job as an instructor at Outward Bound, Rubin, along with some of her co-workers, settled into the top floor of the organization’s Long Island City headquarters. She camped out in a bunk bed; others converted nearby office cubicles into sleeping spaces or pitched tents on the roof of the building. To create some privacy, they hung towels and sheets around their bunks.

Rubin, who has since moved to Vermont for a short while, was grateful for a free place, though Outward Bound officials emphasized they view these cubicles and tents as temporary housing solutions. Read more

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A survey of the wealthiest 10 percent of Americans shows that they are less inclined to buy a second home now than they were when the stock market was cooler and real estate was hotter.

In the spring of 2005, when the real estate market was at its most torrid, 6.3 percent of people with an average net worth of $3.1 million said they intended to buy a second home, according to a report from the American Affluence Research Center.
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Bank of America on Tuesday will begin offering nationally a no-fee mortgage, which will eliminate most of the charges that add a few thousand dollars to every closing.

Bank of America, which is the nation’s second largest lender by assets, has been offering this mortgage in Washington state since September. In February, it expanded the program to eight additional states. Tomorrow, it will begin advertising the “No Fee Mortgage Plus” nationally.

The loan also eliminates private mortgage insurance and the bank is guaranteeing its customers the best deal on interest rates and an on-time closing. Borrowers must put down at least 5 percent. The loans aren’t available to sub-prime customers. Read more

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Washington, D.C. ranks as the top city for African Americans, according to a list compiled by editors of Black Enterprise magazine.

Cities were ranked based on more than 2,000 responses to an interactive survey completed on the publication’s Web site and based on editorial staff evaluations. Criteria in each city includes: median household income of African Americans, percentage of households earning more than $100,000, percentage of businesses owned by African Americans, percentage of college graduates, unemployment rates, home loan rejections, and homeownership rates.

Washington, D.C., attributes are a robust job market and top-notch cultural activities, according to respondents. Also cited was a median home value of $404,900, the highest of all the cities on the top 10 list. Although survey respondents voiced dissatisfaction with local public schools, the survey noted that “the D.C. metro area has the best-educated black population of the cities on the list, boasting the highest percentage of high school and college graduates.”

No. 2-ranked Atlanta was perceived as “offering extensive entrepreneurial opportunities.” A newcomer to the ranking, Raleigh-Durham, N.C., showed a 3.4 percent hike in job growth, which, according to the report, was “the highest employment statistic among the cities ranked.” The report was also conducted in 2001 and 2004. Read more

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Major home mortgage lenders have agreed to adopt a set of principles for dealing with home owners in trouble with high-priced loans, says Sen. Christopher Dodd (D-Conn.), chairman of the Senate Banking Committee.
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