Robert Freedman is the former director of multimedia communications at NAR.
5 to Watch: September 2011
News and trends that we're keeping an eye on this month.
September 1, 2011
1. Closing Costs Up 8.8 Percent
Closing costs on mortgages have increased dramatically nationwide, spiking on average 8.8 percent from a year ago, according to a survey from Bankrate. Origination, title, and third-party fees on a $200,000 loan average $4,070, up from $3,741 from Bankrate’s survey at the same time last year. Analysts attribute the increase to lenders having to do extra work in approving mortgage applications due to increased scrutiny and tighter lending regulations. New York remains the most expensive state to close a loan, at an average of $6,183. Arkansas remains the lowest, at an average of $3,378.
1. New York: $6,183
2. Texas: $4,944
3. Utah: $4,906
4. California/San Francisco: $4,832
5. Idaho: $4,643
1. Arkansas: $3,378
2. North Carolina: $3,410
3. Indiana: $3,430
4. Iowa: $3,474
5. Alabama: $3,501
2. Zillow IPO Attracts $75 Million from Investors
Zillow, the Seattle-based real estate listing aggregator, went public on July 20 and investors pumped about $75 million into the company on its first day of trading. The company’s stock price settled at about $36 a share, which translates into a value of about $950 million. The company, founded in 2004, is probably best known for its “Zestimates,” which provide online home valuation estimates based on a formula that uses information from court records and other public sources. The company, in a July 6 Wall Street Journal article, says the margin of error for its valuations is plus or minus 8.5 percent. The AP write-up of the IPO says the company has never made a profit, although it generated about $30 million in revenue last year, mainly from advertising. The company says that at any one time it has about 100 million homes available for sale or rent.
3. High-Flying Listing Videos
Miramar Coastal Properties in Los Angeles is offering sellers a different kind of listing video: one that uses footage from mini-helicopter flights operated by an aerial video company, HeliMalibu. “We can put [that footage] in the MLS . . . [and on] REALTOR.com,” Miramar President and CEO Bill Kerbox says in a July 21 write-up in Pacific Palisades Patch, a local online news site. The cost to create the aerial video isn’t cheap—prices start at $500. To see a sample, go to http://vimeo.com/26515488.
4. $5,000 Grants for First-Time Military Buyers
Active duty personnel, veterans, retired members of the military, and employees of the U.S. Department of Defense and the Department of Homeland Security are eligible to apply for up to $5,000 in down payment and closing costs in the purchase of a first home. The national nonprofit Pentagon Federal Credit Union Foundation is offering the assistance through its Dream Makers program and says the grants can be applied to a mortgage from any financial institution. More info is at www.PentagonFoundation.org. Click on the “Dream Makers” link.
5. Six Cities That Boast the Best Value
Based on its unemployment rate, median household income, and cost of living, among other factors, Omaha, Neb., offers the best value to its residents among U.S. cities, Kiplinger’s Personal Finance says. Here’s the magazine’s top six:
1. Omaha, Neb.
Unemployment rate: 4.6%
Cost-of-living index: 90.3
Median household income: $53,457
2. Charlotte, N.C.
Unemployment rate: 10.4%
Cost of living index: 93
Median household income: $53,168
3. Nashville, Tenn.
Unemployment rate: 8.5%
Cost of living index: 90.7
Median household income: $51,352
4. Colorado Springs, Colo.
Unemployment rate: 9.3%
Cost-of-living index: 92.0
Median household income: $56,576
5. Knoxville, Tenn.
Unemployment rate: 7.7%
Cost-of-living index: 89.7
Median household income: $45,727
6. Lexington, Ky.
Unemployment rate: 7.8%
Cost-of-living index: 89.1
Median household income: $48,158
Updated: January 21, 2022