Housing Analyst Says the Heartland's the Next Winner

Is Indianapolis gearing up for a housing boom like California, Florida, Washington, D.C., New York City, and Boston have experienced in recent years? That remains to be seen, but this article provides some rational as to why we may be due for above-average price increases in the coming years.

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(May 30, 2006) -- A new statistical analysis of housing price cycles in 100 major metropolitan areas suggests that real estate action is shifting to areas that didn’t enjoy the recent housing boom.

Christopher L. Cagan, director of research and analytics for First American Real Estate Solutions, examined historical housing price movements and concluded that middle America markets like Columbus, Ohio; Indianapolis; Houston; San Antonio; Memphis, Tenn.; Atlanta; Cincinnati; Des Moines, Iowa; and Louisville, Ky., are due for above-average price increases and home building because of expanding employment bases and moderate housing prices.

Cagan also doesn’t believe what he calls the shooting stars of housing booms like most of California, Florida, Washington, D.C., New York City, or Boston are going to incinerate. He simply believes appreciation rates will dwindle to the low single digits or go flat for a while as incomes catch up.

His bottom line: Figure out where your community is in the cycle and adapt.

Source: Washington Post Writers Group, Kenneth R. Harney (05/28/06)
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Indianapolis remains cheapest housing market in U.S.

Indianapolis is the nation's cheapest major housing market for a third consecutive quarter, according to a new report from the National Association of Home Builders. More than 90 percent of homes sold in Indianapolis in the first quarter of 2006 were affordable to families earning the area's median household income of $65,100. The median sales price was $113,000. Los Angeles-Long Beach-Glendale, Calif. maintained its standing at the very bottom of the affordability chart in the first quarter, with just 1.9 percent of new and existing homes being affordable. Another study from Moody's Economy.com found homeowners in Monterey County, Calif., had to tap nearly 60 percent of their gross incomes in 2005 to make the median monthly house payment. In Fort Wayne, the percentage was about 10 percent, Moody's said.

10 Things to Check Before You Buy a Builder House

I came across this great Top 10 list from hometips.com today.

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When buying a brand new builder house, potential buyers often think they can dispense with the need for a house inspector. If it’s new, it must be in good shape, right?

Not always true.

New homes can be just as problematic as old ones. In fact, because they haven’t been tested by years of use and abuse, they can be filled with problems, especially if the builder used any shoddy practices. Hiring a qualified house inspector before you buy is a major hedge against very expensive surprises.

Then again, a house inspector can be very costly—from several hundred to a thousand dollars or more. If you ultimately end up buying the house, this is money well spent. On the other hand, if the house has serious drawbacks, you’re better off saving the cost of the inspector and moving on to a better prospect.

Here are ten clues for determining a house's overall quality before you commit to the cost of hiring a house inspector:

1) The structure. From a reasonably distant vantage point, look at the house. Do the walls appear to be plumb and flat? From inside, are any walls bowed or not square at corners? When you jump in the middle of the living room floor, does it flex or feel solid?

2) Water control. Does the ground slope away from the base of the house? Will gutters, downspouts and drainage pipes carry excess water away from the house...or into the basement? Is there any evidence of water damage?

3) The roof. Is the roof new and in good shape? Does it look neat and properly applied?

4) Details. Do you see signs of quality workmanship in the finish details such as moldings, tile work, hardware and paint?

5) Kitchen & bath fixtures. Are sinks, toilets and tubs quality fixtures? Do they work properly? Is the water pressure good when you turn on the faucets and flush the toilet?

6) Electrical system. Are the number and locations of receptacles adequate to the needs of the house? Is the main circuit breaker marked at least "100 amps"?

7) Water heater, plumbing. Is the water heater gas or electric (gas is much more efficient)? Water supply pipes from the water heater to fixtures should be copper.

8) Heating. Where is the furnace or heater located and what type is it? Are any rooms not heated? Do registers look adequate for heating the spaces? Is the house air-conditioned?

9) Insulation. Look in the attic for insulation; R-19 (6 inches of fiberglass, for example) is a minimum in moderate climates; up to R-38 (12 inches of fiberglass) is required in cold climates. Remove a receptacle cover on perimeter wall to check for wall insulation.

10) Fireplaces. Do they have screens or glass doors (doors are more efficient). What about dampers and log lighters? Is there a combustion vent that draws air from outside and a spark arrestor at the top of the chimney?
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For more great tips about home buying, including how to find a qualified home inspector, visit HomeTips.com.

Indianapolis #14 on "50 Smart Places to Live" List

Indianapolis has popped up near the top of a couple of city ranking lists in the news recently. This time we came in at #14 on The Kiplinger’s Personal Finance List of “50 Smart Places to Live.” According to the article, to come up with the list of cities, Kiplinger began by surveying their readers, to see what factors they consider most important when choosing a place to live. The top two were cost of living and cost of housing. Quality health care and a low crime rate were also among other top requirements.

Continue reading the article here.