Home Sales Near Record; 'Flipping' Often Not Fraud; Homeowners Want Affordability, Flexibility, Livability; Reverse Mortgages Pay Health Care Costs
by Broderick Perkins
Existing home sales reached the second-highest pace on record in the fourth quarter last year. The National Association of Realtors said combined sales of single-family, condo, and co-ops yielded a seasonally adjusted annual rate of 7.76 million units in the fourth quarter, up from 7.3 percent a year earlier. The record pace of 7.8 million units was set in the second quarter of 2004. With 40 states and the District of Columbia revealing increases in sales activity, Arizona yielded the strongest pace with sales rising 28.8 percent. North Carolina's sales rose 25.4 percent and Georgia's sales were up 21.7 percent. Defiantly low mortgage rates continued to boost sales as regionally, the South reported the strongest sales gain, at 8.7 percent. In the West sales rose 8.0 percent, 5.0 percent in the Midwest and 4.3 percent in the Northeast, according to NAR. 'Flipping' Isn't A Bad Word Flipping, the speculative practice of buying property and quickly reselling it for a profit isn't inherently fraudulent, says Washington, D.C.-based National Association of Responsible Home Rebuilders and Investors. It says tens of thousands of satisfied home buyers purchase 'flips' every year and labeling it as fraud not only hurts the investment industry, but many potential first-time home buyers as well. "Everyone agrees that consumers must be protected against disreputable home sellers seeking to take advantage of them," says NARHRI Executive Director John Grant. "But to discourage short term home re-sales is not the right approach to ensure consumer protection. We urge lawmakers to address the underlying acts of fraud, such as collusion between the seller and appraiser, substandard repair work, and acts of mortgage lending fraud, rather than focus their efforts on reducing or eliminating all short term home re-sales", Grant added. What Do Home Owners Want? Affordability, flexibility, and livability. That's what home owners said they wanted in a massive Better Homes and Gardens survey of 60,000 Americans to help the publication build it's Living House prototype. Rising costs have spawned a wish for affordability in housing. The vast majority of home owners, 86 percent, express their wish for affordability in part by performing their own home improvements without hiring out. They want homes that incorporate flexible designs allowing them, to adapt the home to changing family lifestyles. The majority, 68 percent, said they are interested in shifting to a work-from-home lifestyle during the next five years. Home owners typically stay put only three to five years because of expanding families, demonstrating a need for homes that can grow with families. The majority, 69 percent, completed home improvement projects in the past five years and 42 percent plan to do so in the next five years, in both cases, indicating home owners are perpetually changing their homes. More and more often, the outdoors is an extension of indoor living space, with outdoor kitchens, patios, barbecue centers, decks, and other areas serving as "additional rooms." Building a major garden or landscaping project is the second most popular home improvement choice among respondents asked what they would do with $20,000. Mortgages Reverse In-home Care Costs The National Council on the Aging (NCOA), with the support of the National Reverse Mortgage Lenders Association, has published a report that says reverse mortgages can help an estimated 13.2 million elderly homeowners pay for long-term care and remain independent in their homes longer. Of the 13.2 million eligible households, an estimated 9.8 million currently have an impairment that can make it hard to live at home, according to the study, "Use Your Home to Stay at Home: Expanding the Use of Reverse Mortgages to Pay for Long Term Care.". The study said such households could access a total of $695 billion through reverse mortgages, using the extra cash to help with family care giving and other long-term care expenses. A borrower aged 75 years old with a home worth $100,000 could receive a reverse mortgage that could pay a family care giver $500 a month for almost 12 years; $1,120 a month in adult day care services for almost five years; or $2,160 a month in home care -- daily care for at least four hours -- for 2.5 years. "The study shows that reverse mortgages have significant potential to help seniors pay for home health care services or, to make home modifications that make independent living possible," said NRMLA president Peter Bell. | 
