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Scott Pettus' Blog

By Scott Pettus | Agent in Nashville, TN
  • Mortgage Rates Hit 2014 Low

    Posted Under: Home Buying in Nashville, Home Selling in Nashville, Financing in Nashville  |  May 13, 2014 6:55 AM  |  103 views  |  No comments

    Mortgage interest rates hit their lowest levels for 2014 this week.

    The average interest charged to borrowers for a 30-year, fixed rate loan fell to 4.21% from 4.29% last week, according to Freddie Mac's weekly mortgage rate report.Nashville Mortgage Rates

    Rates have not been this low since the week of November 7, when they were at 4.16%.

    The 15-year, fixed rate mortgage, a popular loan for homeowners refinancing existing mortgages, hit 3.32%, down from 3.38% last week.

    Global unrest and a weak U.S. economic recovery have kept rates low on U.S. Treasury bonds, which is used as the benchmark to set most consumer interest rates.

    "Mortgage rates continued moving down following the decline in 10-year Treasury yields after a dismal report on real GDP growth in the first quarter," according to Freddie's chief economist Frank Nothaft.

    World events was a key factor.

    "The effects of slower growth in China and the unstable situation in Ukraine are all contributing to the ongoing bid for Treasury debt, driving yields down and pulling mortgage rates down too," said Keith Gumbinger, vice president of HSH.com, a mortgage information firm.

    It is, of course, good news for homebuyers. Payments on a $200,000 30-year, fixed-rate mortgage would be only $979 a month at a rate of 4.21%. Borrowers with rates closer to the historical norm of 6% would pay about $1,200 a month.

    But continuing strict lending standards has limited the positive impact of low rates on the housing market recovery, according to Lawrence Yun, chief economist for the National Association of Realtors.

    "The low rates are very good for people with high credit scores," he said. "But credit is still very tight for borrowers with lower scores. Many people would like to buy, but can't obtain financing."

    These low rates are still significantly up off the record low set in May 2013, when the 30-year hit a rock-bottom 3.35%.

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 615-714-0905

    Source : CNN Real Estate

  • New Townhome Development Planned for Hillsboro Village

    Posted Under: General Area in Nashville, Market Conditions in Nashville, Home Buying in Nashville  |  April 24, 2014 7:23 AM  |  173 views  |  No comments

    A Nashville real estate partnership has bought roughly half an acre a block away from 21st Avenue South in Hillsboro Village with plans to redevelop the property into a community with 21 townhomes.Nashville Condo

    Rigid Development Inc. and Cornerstone Investments Inc. paid $2.1 million for the two parcels at 1911 Convent Place and 2001 Convent Place. Currently, both parcels have rental properties that will be torn down for the redevelopment.

    The townhomes will range in price from $399,000 to $550,000, said Rigid Development’s owner Brent Craig, who was a key player in revitalization of 12South. “We’re trying to produce products that are all energy-conscious, LEED-certified and as economically priced as possible,” he said.

    The property is zoned high-density residential, which allows for multi-family dwellings at 40 units per acre. “It’s a dynamic location, so it will be a good product for the community,” said Brandon Hoop, a local real estate broker who managed 1911 Convent Place for the Indiana investor that had owned it.

    Craig’s partner in the planned project is Lane Wallace of Cornerstone.

    Mary Skinner, who lives less a mile away from the redevelopment site, said she’s saddened that the two homes on the properties are slated to be demolished.

    “Most of the streets in the Hillsboro-West End neighborhood are now part of the historic conservation overlay that protects this from happening,” she said. “Unfortunately this street was not protected.”

    The townhomes site is not far from where homebuilder David McGowan of Regent Homes is building Acklen at 24th Avenue, a 16-unit residential building with five of the units already sold.

    “There’s over 20,000 employees that work in that area and a lot of them want to be close to their jobs,” McGowan said. “It has built-in amenities such as the retail and commercial centers in Hillsboro Village.”

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 615-714-0905

    Source : The Tennessean

  • Twelve Twelve Tower in Gulch Going Condo

    Posted Under: General Area in Nashville, Home Buying in Nashville, In My Neighborhood in Nashville  |  April 9, 2014 9:01 AM  |  244 views  |  No comments

    It’s official. The 286-unit Twelve Twelve residential tower in the Gulch is going condo.

    The project’s lenders, U.S. Bank and J.P. Morgan, which financed the 23-story high-rise at 12th and Laurel as apartments, agreed to allow for the switch if developer Ray Hensler can convert at least $35 million worth of reservations to contracts.

    With $50 million worth of reservations in hand from 70 would-be buyers, Hensler doesn’t see a problem hitting that target by the end of this month. Reservations include seven penthouses and most corner two-bedroom units that were the first to be pitched as condos starting in mid-January.Twelve Twelve Condos

    “We’re pleased with the whole process thus far,” Hensler said about averaging one reservation a day since the effort launched to gauge demand for switching to condos.

    Reservation holders, who put down 10 percent of the price of the units, will be asked for another 10 percent when they sign contracts by end of this month.

    Hensler said Twelve Twelve reaching the $50 million reservations mark without advertising is a clear sign of a pent-up demand for high-rise condos around downtown Nashville.

    Twelve Twelve will be downtown’s first developer-built, high-rise condos since the market collapsed five years ago amid a glut of new units on the heels of the Great Recession. Most of that supply was eventually absorbed amid a rebound in the market with no developer-owned units available and scant supply of resale condos.

    Hensler expects the condo units to be ready in August and September.

    The average price of the reserved units, including the penthouses, is $714,285, while the average price of the remaining units is $471,984, said Zach Goodyear, managing broker at Parks in the Gulch.

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 615-714-0905

    Source : The Tennessean

  • 3 Major Things to Know About the Housing Market

    Posted Under: Home Buying in Nashville, Home Selling in Nashville, Investment Properties in Nashville  |  March 25, 2014 11:54 AM  |  240 views  |  No comments

    The following list was put together by a veteran housing economist, asked by HousingWire for his opinion on the near-term future of the markets we cover daily.

    Here's David Berson's take on the 3 things you need to know about housing in 2014.

    No. 1: 2014 should prove to be the strongest year for housing activity since before the Great Recession.

    Housing activity (home sales and housing starts) has increased modestly over the past several years, but is still at levels well-below sustainable trends. For both economic and demographic reasons, 2014 should be the year when activity reaches the highest level since 2006/2007.

    Propelling home sales are job growth and housing affordability. The latter reflects the interplay of household income, mortgage rates and house prices. In 2013, while housing activity picked up, it was a year when job growth remained low and virtually unchanged from the previous year.  Moreover, affordability, while still high, fell sharply in the second half.

    Most economists expect an improved job market in 2014, with employment growth accelerating and the unemployment rate continuing to decline. That jobless rate drop will reflect more of a pickup in employment than further declines in the labor force participation rate. This will be the key factor improving housing demand this year, even if mortgage rates rise and affordability declines. While the housing market tends to do especially well when the job market improves and mortgage rates decline simultaneously, that combination of events occurs only rarely.

    More often, either job gains accelerate while mortgage rates rise, or job gains decline while mortgage rates drop. Typically, housing activity expands in the former case and contracts in the latter. People buy homes when their job and income prospects improve – even if it’s more expensive to do so – rather than buy when it is inexpensive to do so but they’re worried about keeping their jobs.

    No. 2: Demographics should start to favor housing activity.

    The demographic factor most affecting the housing market is household formations. Newly formed households may buy or rent, but they reside somewhere as an independent unit. On average, roughly 1.2 million households form every year in the United States and they each demand a housing unit. Household formations are affected by the job market, as people “double-up” when worried about their job and income-earning prospects. The Great Recession and the modest job recovery in the years following induced many people who might have lived independently to move in together. That’s most noticeable in the rise in the share of young adults living with their parents, primarily because of the weak job recovery.

    Reflecting the slow pace of household formations, there is an increasing pent-up demand for households. After all, most of these young adults would prefer the freedom of being on their own (and their parents really don’t want them as full-time residents, either). We estimate the economy is short by more than three million households.

    If the economy expands at a faster pace this year, bringing a more rapid rate of job creation, that should translate into more households, raising housing demand. We won’t see all three million missing households return to the housing market at once. (That wouldn’t be a good thing for the housing market anyway, since that would be on top of the 1.2 million households that normally would develop this year; such a surge would swamp the existing housing supply). Beginning in 2014, the pace of household formations should accelerate to an above-trend pace for several years, pushing up housing demand.

    No. 3: Mortgage availability shouldn’t worsen and may improve.

    Mortgage credit isn’t nearly as easy to get as it was during the housing boom, and it shouldn’t be.  Still, compared with recent years, mortgage availability has increased slightly. And reasons exist for mortgage availability to be no worse in 2014 than in the past few years. Actually, it may be somewhat easier to get a mortgage loan.

    With the dislocations in mortgage lending since the housing bubble popped,Fannie Mae and Freddie Mac have increased their share of the mortgage market significantly. When combined with lending from the Federal Housing Administration and the Veteran’s Administration, the government or government-sponsored share of mortgage lending has climbed to more than 90 percent in recent years. That is an untenable situation in the long run, but is unlikely to change much this year.

    The good news is that new Qualified Mortgage lending rules from theConsumer Financial Protection Bureau exempt home mortgages that qualify for purchase or securitization from Fannie and Freddie. As a result, mortgage lenders won’t have to tighten their mortgage-underwriting requirements in response to QM as long as they sell their loans to the GSEs.

    Additionally, the rise in mortgage rates already has reduced mortgage origination volumes as refinance activity declines. If mortgage rates rise further this year, as expected, then refinance activity will fall still more. In response, mortgage lenders probably will ease lending standards to the extent possible under the QM rules to boost lending activity by increasing purchase originations. As a result, the increase in new households expected to be created this year, spurred by a stronger job market, should find that qualifying for a mortgage loan will be somewhat easier in 2014 than in prior years.

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 6157140905

    Source: Housing Wire

  • Google targets Nashville for high-speed fiber network

    Posted Under: General Area in Nashville, Quality of Life in Nashville, In My Neighborhood in Nashville  |  February 21, 2014 9:59 AM  |  274 views  |  No comments

    Nashville is on the short list of cities under consideration for the next round of Google Fiber, the tech giant announced today.Google

    The California-based company is looking at nine metro areas to deploy its high-speed Internet and TV service, which delivers Internet speeds at one gigabit per second, up to 100 times faster than basic broadband.

    "Nashville is a fast-growing, vibrant city, and this announcement speaks to our momentum as a city of the future," Nashville Mayor Karl Dean said in a statement. "Google is still in the early stages of looking at our city's infrastructure, and we look forward to working with the company as they explore the possibility of bringing Google Fiber to Nashville."

    Other cities on the list include: Portland, San Jose, Phoenix, Atlanta and Charlotte, among others.

    This is the latest interest Google has shown in Nashville, following successful Google for Creators and Google for Entrepreneurs events, as well as opening a Google hub in the Nashville Entrepreneur Center last fall.

    "I think we can all agree that Nashville is the intersection of technology and music, and we think that's a super exciting place to be," said Matt Dunne, head of community affairs at Google, who is in town today for the announcement. "We are excited to see what a community like Nashville can do with a gig."


    For more: What is Google Fiber?


    As the city strives to raise its tech profile and attract and retain new talent, Nashville business leaders have been advocating for better citywide infrastructure supporting high-speed Internet, pointing to nearby Chattanooga as an example.

    The company hopes to announce which cities will move ahead with Google Fiber by the end of the year. If all goes smoothly, the consensus is Google could be delivering Fiber to households by the end of 2015, Dunne said.

    But in today's announcement, Google warned that inking a fiber deal in each city is a long way from done.

    "It takes a lot of collaboration with cities to build a new network," the company wrote in a fact sheet. "Today we're starting a joint-planning process -- basically a series of conversations and information-gathering exercises. Later this year we'll have updates on which cities will get Google Fiber."

    Part of the uncertainty is that fiber-optic cable -- which, in Google's case, first aims to reach residential users -- is a big lift to install, including citywide construction and installing thousands of miles of new cable. In Provo, Utah, Google bought the city's fiber-optic network, paving the way for it to become the country's third Google Fiber city, behind the Kansas City area and Austin.

    According to its website, Nashville Electric Service owns a 170-mile fiber-optic network, but it's not clear yet whether Google would be eligible to lease or use any of the existing network. Not including the fiber that the utility uses for internal communications, NES leases out fiber to 16 customers serving 86 locations.

    "Building Google Fiber is a big job," the company wrote. "It's construction work -- literally digging up streets and climbing up poles. This could be enormously disruptive to a community that's not ready for it -- residents and city leaders alike. So we want to get ready together, up front and make things as smooth and predictable for everyone as we can."

    But Google’s Dunne sounded optimistic about Nashville.

    "We didn't choose Nashville to be a part of this joint planning process by accident," he said. “It's a city that has a reputation for thinking outside the box and moving at what we like to think of as Google speed."

    Local tech entrepreneur Mark Montgomery, who has been instrumental in bringing Google to Nashville over the years, said he, and others, are committed to making sure this happens.

    "To me, what's in the way is so small compared to the benefit," he said. "I think it would be suicide to stand up and go, 'This is a bad thing.' … I don't think you can find any real, logical reasons why this isn't a good thing."

    Montgomery sees Googles interest as another market validator for Nashville, another reason to put Nashville in the national spotlight as a city to watch. But he also thinks it will spur more competition, which in turn will benefit consumers and drive innovation. Montgomery pointed to Austin, where AT&T brought its own fiber-network after Google announced it was entering the market.

    Finally, he sees tremendous public service benefits, especially in low-income areas of Nashville that are traditionally underserved by Internet access. Google Fiber runs a Community Connections program in other cities, which gives select public and nonprofit organizations Google Fiber connections for free.

    Dunne said it's too early to know whether or not Nashville, if selected, would benefit from a similar program, but said Google is always looking at similar programs.

    "We are certainly committed to making sure we can include as many people as possible in the digital age," he said. "This is something that we have tried in our initial cities -- we are too early a stage to know if we would do that in Nashville, but we will be exploring creative ways to engage the community."

    Michelle Lacewell, spokeswoman for the Nashville Area Chamber of Commerce, said the announcement was exciting for future economic growth and prosperity.

    "We see investment in infrastructure … as important to the region for growth, and every community wants to be able to increase their capacity for telecomm to serve business and residents," she said. "It opens the conversation."

    Montgomery and his team at FLO{thinkery} are hitting the streets and taking to the Web to spread the word about Google Fiber and rally support, directing people to this Web page created by Google.

    Discussions are still in the early stages, but here's what getting Nashville ready for Google-Fiber will look like:

    • Sharing of detailed, accurate maps of existing infrastructure (sewers, telephone lines, utility poles) between the city and Google
    • Ensuring Google can access and put its fiber on existing poles or conduits
    • Reviewing the city's permitting process to make sure the construction phase can move quickly without any hold-ups related to volume.

    If Nashville progresses beyond the planning stage, a team of engineers and surveyors will design the network (and a backup network) street by street before any construction begins.

    When construction of the network does begin, it's worth noting that Google Fiber follows a "build-by-demand" model. The fiber network passes into each neighborhood via a box called the telecom cabinet, which can deliver fiber to hundreds of neighbors in the surrounding area, creating "fiberhoods." Each fiberhood will only be lit up when a certain number of residents indicate they want the service.

    "We focus our energy on a handful of fiberhoods at once, doing an all-out installation and construction blitz," explains the company. "We do this so we can provide you with better, faster service; we won't make you wait around for a crew that's stuck across town. After we're done in one fiberhood, we'll move on to the next."

    Although Google Fiber is exploring a small business network, Dunne emphasized that the main priority is residential and consumers.

    "We believe that the next generation of applications will be built for gigabit-speed technology," he said. "Apps are only good when consumers can use them and we believe that consumers want faster speed."

    He also added that it could be attractive to entrepreneurs and IT workers, two growing and vital sectors of Nashville's economy.

    "[It's] attractive to entrepreneurs who don't necessarily do their best work between 9 and 5," he said. "They do it in their garage and spare bedroom at all hours of the day. … We are excited to see what an innovative city like Nashville can do with that capacity when they have it at their access."

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 6157140905

    Source: Nashville Business Journal

  • Banks Offering Mortgages With Only 5% Down Payments

    Posted Under: Home Buying in Nashville, Home Selling in Nashville, Financing in Nashville  |  November 7, 2013 6:36 PM  |  298 views  |  No comments

    Good news for homebuyers who don't have a lot of cash on hand: Banks are offering loans with down payments of just 5%.

    After the housing bubble burst, buyers needed to come to the table with as much as 20% down or they had to turn to the Federal Housing Administration for a low down-payment loan.Nashville Condo Mortgage Rates

    But now banks like TD Bank, Bank of America (BAC,Fortune 500), and Wells Fargo (WFC, Fortune 500)are loosening the purse strings, offering loans with down payments that are as low as 5%.

    TD Bank's "Right Step" mortgage, for example, allows borrowers to secure a loan with a 5% down payment. It also allows them to receive as much as 2% of the sale price as a gift from a relative or other third party, so they would really only need 3% down.

    Why the change of heart? Market opportunity for one thing.

    FHA dominated the market for low down payment loans during the housing bust. Taking on all those risky loans, however, depleted the agency's reserves and has forced it to increase costs.

    Over the past couple of years, the FHA has been raising premiums. And this year, it started requiring borrowers to buy private mortgage insurance for the life of the loan -- an expensive proposition that has sent many prospective borrowers looking elsewhere.

    While the loans were far too risky for private lenders to take on before, rising home prices have made them less of a gamble. Plus, the banks think they can offer a better deal than FHA.

    "As the FHA selectively reduced market share by increasing premiums, we introduced a substitute for FHA loans," said Malcom Hollensteiner, the director of retail lending sales for TD Bank.

    While the private lenders that are offering the 5%-down loans are also requiring borrowers to buy private mortgage insurance, they are only requiring them to do so until they build up 20% equity in the home.

    The difference can really add up. Paying an insurance premium over the life of a $200,000, 30-year fixed-rate loan from FHA that carries an effective mortgage rate of 4.4% (5.75% when you tack on the insurance premium), can add up to nearly $60,000 over the life of the loan.

    Of course, homeowners can always refinance to end their FHA insurance, but rates are so low that by the time an FHA borrower is able to refinance to a lower rate, it may not be worth it.

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 6157140905

    Source: CNN Real Estate

  • Centennial Park to Get Major Upgrades Soon

    Posted Under: General Area in Nashville, Parks & Recreation in Nashville, In My Neighborhood in Nashville  |  October 24, 2013 12:02 PM  |  350 views  |  No comments

    The revitalization of Centennial Park’s water features — including Lake Watauga and an underground spring that’s been hidden for a century — will begin next month.Nashville Parks

    The work is part of $6 million in upgrades planned at the historic Nashville park and makes up the first of six phases in a master plan that has been in the works since 2011.

    In addition to the water projects, a new amphitheater will be built near the park’s West End Avenue entrance.

    Altogether, park supporters and officials say the revamps will usher in a new era for a park created in 1897 and home to the tourist-drawing replica of the Parthenon.

    “We felt this park has never been more relevant, and we wanted to make sure ourfocus included revitalization,” said Sylvia Rapoport, president of the Conservancy for the Parthenon and Centennial Park. “One thing about Centennial Park: Every generation has framed it in their own way.”

    Metro crews will soon begin work on two water projects.

    They’ll be dredging and cleaning Lake Watauga, which has had chronic algae problems, by installing new aeration and circulation pumps, as well as restoring floating vegetation to absorb pollutants.

    “We have a big issue with algae each year, and all of these issues that we’ve been having should be alleviated,” said Metro Parks Director Tommy Lynch.

    The lake also will begin receiving coldwater pumped from Cockrill Spring, which has long been buried underground, with its water directed into a pipe. That spring will be unearthed — known as “daylighting” — to create pools and a shallow stream for park-goers, as well as a new pedestrian entrance.

    Restoration of the spring is part of a focus on the area of the park closest to West End Avenue, which has been host to the outdoor Musicians Corner event in recent years, but little else.

    In addition to the stream and a garden, that portion of the park will get a new amphitheater with permanent seating.

    “There will be a lot of area in the front where people can gather and walk, and it really engages that front portion of the park,” Lynch said.

    Park visitors may see orange fencing blocking off work areas in the coming weeks, but the park will remain open while crews work. The water projects are due for completion in the spring, officials said. The work is being paid for with $5 million from the city and $1 million in fundraising from the conservancy.

    To read more of my blog, please visit my website at www.nashvillecondogroup.com.

    If you have any questions about this blog, or need help with any part of the real estate process, please feel free to call me. To search for all Nashville condos, homes, and even rentals currently on the market, please go to my search page at www.nashvillecondogroup.com/search.

    Scott Pettus

    Pilkerton Realtors - 6157140905

    Source: The Tennessean

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