Posts Tagged 'bucks county'

Opportunities Abound for First-Time Homebuyers

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By Keith Reilly

If you have recently decided to move from renter to homeowner, you are not alone. First-time homebuyers made up 41 percent of the market, according the National Association of REALTORS®’ 2008 Profile of Home Buyers and Sellers. And price declines in many markets around the country have created unique opportunities for those considering home ownership for the first time.

As a homeowner, you have security and stability, the freedom to decorate and remodel, potential to build equity and tax benefits. And with interest rates still at historically low levels – 5.22% for the typical, 30-year fixed-rate mortgage (as of early August 2009), combined with ample inventory, now is a great time to buy.
Plus, there are several incentives and programs available specifically for first-time homebuyers.

First-Time Homebuyer Credit
One program that is a great financial opportunity is the highly publicized First-time Homebuyer Credit, which was part of the Housing and Economic Recovery Act of 2008. This federal initiative allows first-time homebuyers to take up to an $8,000 tax credit, which doesn’t have to be repaid, toward a new or resale property purchased prior to Dec. 1, 2009. For new construction, the purchase date is considered to be the date you first occupy the home.

Under this program, a first-time homebuyer is considered to be anyone who has not owned a principal home within the last three years. If you are married, both spouses must meet this criterion. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first-time buyer. In addition, ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer. You are also eligible to claim first-time buyer status if you owned a principal residence outside of the United States within the last three years.

The actual tax credit may vary depending on the purchase price and your income. The credit is generally equal to 10 percent of the home’s purchase price, not to exceed $8,000. In addition, the income limit to receive full credit is $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return.

For complete details, visit and As always, consult with your tax advisor on how this tax credit may affect you.

Mortgage Loans
As a first-time homebuyer, you don’t have the advantage of using the equity in a previous property to help bridge costs associated with down payment, closing and other fees. Many financial institutions have mortgage products with you in mind. In addition, the Federal Housing Administration (FHA) offers mortgage programs in which your down payment can be as low as 3.5% of the purchase price, and allows most of your closing costs and fees to be included in the loan. Although FHA does not directly loan to consumers, you can work with a FHA-approved lender. For more information, visit

The transition from renter to homebuyer is a large step and is arguably one of the largest investments you’ll make, so make sure you take advantage of all the assistance available to make the road to homeownership that much easier.


A Year in Review…


Since beginning my real estate career in May of this year, I have had the privilege of experiencing many different aspects of the business and I have to say…I love it!  I just wanted to share with you some of the things that I’ve been blessed with doing this year:

· I have attended countless training courses in subjects such as ethics, buyer/seller representation, real estate investing, commercial transactions, foreclosures and many other topics in order to get up to speed with my peers within the industry. 

· I have shown over 150 homes to clients throughout Bucks County, Montgomery County, Philadelphia County, Chester County and Delaware County resulting in successful sales and satisfied customers.

· I have connected out of state clients with trustworthy, local real estate professionals in South Carolina and Delaware that have resulted in closed transactions and satisfied customers.

I am hoping that with a can-do attitude and strong work ethic my business will continue to grow in 2009 in the face of a challenging market. 

I would like to personally thank those of you who have supported my transition from the US Marine Corps into real estate this year.  I continue to find this career an exciting challenge and am optimistically looking forward to serving you in 2009!

 Happy Holidays to you all and many blessings in the New Year!

Bucks County Real Estate Market for Third Quarter 2008

As you can see below, while the rest of the country is experiencing a decline in real estate pricing, Bucks County prices continue to increase.  This is due to the steady increase in employment and population that is mixed with very low mortgage rates.  For these reasons, TREND is forecasting continued growth in the fourth quarter for Bucks County housing prices.

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click to zoom


Flipping houses- The Down & Dirty

So you wanna try flipping houses?  I’ll give you some pure basics to get you started.

1.  Locate an undervalued home for sale that is structurally sound but requires some pretty extensive cosmetic work.  When I say cosmetics I mean rehabbing the siding, windows, kitchen, bathrooms, carpets, appliances and painting the walls.  To find an undervalued home, I would recommend using a Realtor.

2.  Once you’ve found your target home,  you are going to need financing.  One source of funding that rehabbers use are “hard money lenders”.  These types of loans are secured by the value of the house you are going to flip and are usually issued by private investors.  Talk to your Realtor about finding hard money lenders or check with your local real estate investing group.  For those of you from Bucks County, the local investing group would be DIG (

3.  Ok, you’ve found the home and got the financing.  Now is time for the number crunching.  First determine your After Rehab Value or ARV.  This is the value of the property once you’ve finished all the cosmetic work.  This can be determined by your Realtor.  Here is the basic format for determining your bottom line and what your offer should be for you to make a minimum of $10,000 cash on the flip (The Golden Rule).

ARV minus:

  • Repair Costs
  • Holding Costs (monthly loan charges)
  • Sales commission (5%-6% of ARV)
  • Closing Costs ( transfer taxes on the buy and the sell, 1% for each in Bucks County)
  • Hard Money Costs (points-probably around 3%-5% of the loan)
  • PROFIT ($10,000 MINIMUM!)

Now, what’s left is what your offer is going to be.  Simple right?  Again, for more details please consult a real estate professional.


Your average home in Falls Twp is selling for around $230,000; so we’ll make that our ARV.

ARV $230,000 minus:

  • Repair costs $20,000
  • Holding costs $6,000 (takes three months to flip and sell)
  • Commission $11,500 (5% commission on the sale)
  • Closing Costs $4,000 (transfer taxes of 1% on the buy and then on the sell, estimated)
  • Hard Money Costs $5,000 ( 5 points estimated)
  • PROFIT $10,000 MINIMUM


Now, can you find houses selling for $173,000 in Falls Twp?  You bet.  I’d love to show them to you!

Bucks County Real Estate Market Graphs

Median Sold Price for every real estate transaction in Bucks County over the last 2 years.  This graph includes single families, unit/flats, row/townhomes and mobile homes with a price range from 0-100,000,000.

Median price for Bucks County over the last 2 years

Median price for Bucks County over the last 2 years

This next graph provides a visual representation of the distribution of prices in Bucks County.

Blue Line-The number of properties that were LISTED over the last 12 months

Green Line-The number of properties that were SOLD during the last 12 months

Red Line-The number of properties currently ACTIVE.

Bucks County price distribution

Bucks County price distribution

This last graph shows supply and demand over the last two years.

Bucks County 2 year supply and demand

Bucks County 2 year supply and demand

all the information contained in these graphs is supplied by

Month’s Supply of Inventory (MSI) and why its important

When selling a home, it is important for one to understand the factors affecting how long it will take for that particular property to sell.  One of the factors that can affect the sale is whats called the month’s supply of inventory or MSI for short.  The MSI is a calculation that expresses how long it will take for all the homes (inventory) in a particular market to be sold.  This calculation is based on the amount of homes currently on the market and how quickly  these homes are selling.  For those of you mathematically inclined, the calculation is as follows:

The number of properties For Sale (FS) during the month (that is, the property was Active at least one day during the month) minus the number of properties that went Under Contract (UC) during the month minus the number of properties that Expired (X) during the month, divided by the number or properties that went Under Contract (UC) during the month:

MSI = (FS – UC – X) / UC


At the end of September in Bucks County their were 2,791 homes currently on the market with 252 homes under contract.  2,791/252 = 11.08

What this says is that it will take 11 months for the inventory in Bucks County to be sold.

Pictured below is a graphical representation of the MSI for the last two years in Bucks County.

In practical terms, the higher the MSI the more of a Buyer’s Market there is.  There are many more homes to choose from and home sellers will compete with each other, thus driving down prices.  If the MSI is lower, then there is less inventory on the market which gives home sellers the advantage.  For instance,  when the market was a Seller’s Market in 2005, the National Association of Realtors quoted that the MSI was about 4.6.  Compare that to the current Buyer’s Market MSI in Bucks County at 11.  Understanding the MSI is important because it helps to give real estate consumers a clear picture of what the market is doing and what they can expect when buying or selling a home.  By looking at the graph above, you can clearly see that today’s market is in fact a Buyer’s Market and consumers need to set their expectations accordingly.

The statistical information provided in this post was obtained from

Bucks County Real Estate Appreciation

Average sales price for single family homes in Bucks County¹

Date             Price              Appreciation

Dec 2000     $209,000        start

Dec 2001     $225,000        7.66 %

Dec 2002     $260,000        15.56 %

Dec 2003     $286,000        10 %

Dec 2004     $323,000        12.94 %

Dec 2005     $361,000        11.76 %

Dec 2006     $376,000        4.16 %

Dec 2007     $378,000        .53 %

Aug 2008     $362,000        -4.23 %

Total Appreciation Dec 2000 to Aug 2008: 7.35 %


Keith Reilly




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