European Stars And Stripes (Newspaper) - April 6, 1986, Darmstadt, Hesse                                Housing Boom continued from Page 13 wondered is it a trick what s the catch but it s been no problem except the waiting in  like the dil Mandis Many of those taking advantage of the new rates want to Cut monthly payments on a Home they already own. According to experts it pays to refinance a Home mortgage when there is a two to three percentage Point difference Between the interest rate on the existing mortgage and the currently available rate. Such a spread is necessary before refinancing is profitable because of the closing costs on a new mortgage. A refinance should plan to stay in the House Long enough for the monthly savings to make up those costs. In Many cases the drop in mortgage rates has changed people s lives. For Carol and Jeff Haksluoto in Madison Heights mich., it Means More than a Chance to move out of their Mobile Home and into a House. Mrs. Haksluoto 24, May also be Able to stay Home with the couple s 4-month-old daughter Casey instead of working to make the House payment. We weren t sure we would be Able to do that last year she said. Up to one third of those taking out mortgages in some areas Are buying a House for the first time. What it s really Good for is the Man who has t Home mortgages average annual interest rate 1974 76 78 80 82 84 86 january Only Chicago Tribune graphic source National association of realtors been Able to buy a Home before now said Lynn Greer president of the Tennessee Board of realtors. Our real estate brokers and agents have been pretty resilient and have been Able to make a living when interest rates Are up and Down but it s the Man on the Street who s profiting  Jana Waring Greer spokeswoman for los Angeles based builder Kaufman & Broad which specializes in modestly priced Homes for first time buyers said sales Are up 40 percent since the beginning of the year. We have seen an increase in houses All across the Board but the biggest increase has been in the first time buyer Market she said. Still the mortgage tide lifts everyone. People Are going out to buy that vacation Home they be always wanted said Charles Ferraro of the Bank of new England in Boston. In other cases he said we re seeing a lot of people moving into their dream  Mick and Becky Proctor Are refinancing their Charlotte n.c., Home from 13 percent to 9.5 percent with their monthly payment dropping from $855 to less than $700. It s like getting a pay raise Proctor said. The couple plans to add the extra Money to savings maybe starting another account for vacations and unexpected expenses. Many people Are using the savings to convert from a 30-year mortgage to a 15-year loan. That Way while monthly payments May not fall a Homeowner can save tens of thousands of dollars in interest Over the years. Other refinances Are putting the monthly savings toward their children s education or into remodelling projects. That s How the wave of mortgage activity is washing through the american Economy. Jack Milarch executive vice president of the new Mexico Home builders association in Albuquerque summed it up this Way someone moves into a new House he needs landscaping so he Calls a landscaper. The landscaper Calls the Nursery and also a Sod farm. And the Sod farm May Call for a new tractor because there s so much  echoes Thad Vann executive director of the Mississippi association of realtors new housing starts will have a Ripple effect on the state s Economy from manufacturing on Down. We project that mississippians average after tax income will increase by 4 percent in 1986. Builders in Pennsylvania figure 1986 As the Best time they be seen since 1979," said David f. Sheppard executive vice president of the Pennsylvania builders association. The first two months of 1986 were the biggest Ever in terms of building permits in Salt Lake county Utah according to Ken Jones director of the county s tips on refinancing housing hot spots since 1983, Northeast Home prices jumped 22.9% double the rate of increase in any other Region of the country. Key Northeast q South West ��3 North Central increase in Home Cost median Home Price northeastern City comparisons All figures Are median amounts office of development services. In the Baltimore area 2,374 building permits were approved in january and february compared to 1,878 for the same period last year said Gail Owen of the regional planning Council. There is definitely going to be a correlation Between lower rates and building permits As the year goes on Owen said. Oregon s largest privately owned Timber company Roseburg Forest products co., recently filled 200 jobs mostly with Laid off employees said spokesman Bob Wilson. Economists say there s three to five new jobs created for each new Mill Job just because of the Ripple effect. I be seen a lot More optimism from the people. The merchants seem to be smiling for a change. Optimism Breeds optimism Wilson said. Another measure of the Boom is the number of people seeking licenses As real estate agents. It s been ridiculous almost said Jim Marrion owner of the professional Institute of real estate in Phoenix Ariz. Normally he said fewer than 200 students would begin classes in february but last month 300 registered. It s picking up  he s right. From Hawaii to new Hampshire people Are paying License fees and taking exams to get a piece of the housing action As agents and brokers. As an example the new Hampshire realtors association had 2,700 members a year ago now it has 4,200, said its executive vice president Robert Authier. The prices of houses they re Selling Are on the Rise too. When mortgage Money is Low As it is right now invariably the Price of the Homes increases said William j. Cinque president of the Philadelphia Board of realtors. Home prices appreciated 38.2 percent in Boston and 29.8 percent around new York City in 1985, according to a National Board of realtors Survey but even some economically hard pressed areas have been helped. The average Price of Homes in the Buffalo n.y., Region Rose 6.3 percent in 1985, the Survey found. In most areas it s a seller s Market. Ron Berman a broker in the Detroit suburb of Southfield mich., noted serious buyers know they have to put in an offer when they see a House they like or it May be gone the next  Home sales remain sluggish in some areas including parts of Oklahoma despite a brisk re financing business but such areas Are few. Even in Texas where the slumping Oil Industry depressed the housing Market and brought foreclosures in Many places there Are signs of a rebound. The rates Are Good said Jim Fite president of the greater Dallas Board of realtors. The buyer apathy is  new York times photo if the consumer perceives that interest rates have bottomed out and Are on the Way up the Market will become even More  City new York. . Boston. Maw. It work no Danbury. Conn. Zuhua . Philadelphia. A. Trenton. . Pittsburgh. Be. Pilot of now $129.700 $126.000 $116.000 $05.950 $82.000 $69.450 $66.000 $64.152  $42.250 $30.000 $29.450 $19.750 $10.666 $17.500 $16.500 $11.500 monthly housing Bill $1.141 $1.116 $1.139 $954 $691 $733 $703 $673 Home buyer s annual Noom $49.692 $65.956 $54.660 $51.868 $43.200 $39.180 837,434 $40.680 housing Bill inc Udas mortgage payment. A i Astana Texas. Utill Las. And Hazard insurance. Sourova . Langua of savings institutions up graphic / c. Broadway by Bill Mccloskey associated press in general says the mortgage banker association you May not save Money by refinancing your Home unless your answer Isles to these two questions will you live in your Home three More years will your interest rate go Down at least two Points when you refinance you have to go through closing again so there will be expenses to offset the savings from a lower interest rate. You do not have to repay Transfer taxes but you will have to buy some of the same reports and pay lawyers fees again. In calculating to determine if the savings make it worthwhile lenders advise working out a rough Sheet of calculations. In 42 states you May have to pay a penalty for paying off the old loan Early. This does not apply to a or Cha Loans. Your loan contract will answer this question. For guidance on other costs the Best sources probably your settlement Sheet from the original closing. Look for the Price of title search title insurance a credit report attorneys fees and appraisal fees. Your Lender for the new loan will Tell you How Many Points you will have to pay. Each Point equals 1 percent of the loan amount. Consulting with the Lender can Lead to some savings. Title search this fee about $15, can be negotiated. Title insurance the mortgage Bankers recommend asking the original Lender if a substitution loan rate policy can be issued rather than a new owner s policy. The old policy May apply they say and the savings could be As much As 70 percent of the roughly $400 fee. Credit report this fee May be waived if you stick with the same Lender. Attorney s fee you can use your lawyer or the Lender s. Ask what the fee will be. Points Check with a number of lenders especially institutions where you have accounts. You la often do better where you already do business. Appraisal this charge covers the Cost of making sure your House is Worth enough to justify the amount you want to borrow. Document preparation notary services and recording taxes May also apply. Once you have roughly determined the expense of refinancing you need to consider the savings. Calculate Only the principal and interest payments since other fees such As insurance and taxes collected As part of your mortgage payment will Likely remain the same after refinancing. Most real estate brokers and lenders should be Able to determine quickly what monthly principal and interest payments would be at today s rates on the amount you still owe. Subtract the potential new payment from the current principal and interest payment to determine the monthly savings. Why people refinance $100,000 mortgages Sample monthly payments Home mortgages 12%, 30 years $1,029 10%,30 years $878 10%, 15 years $1,201 average annual interest rate 18% 9.5%, 30 years $840 9.5%, 15 years $1,044 refinancing costs loan application fee $250 15 12 9 6 i title insurance $400 Survey $100 closing Points total $2,000 $2,750 1974 76 78 january Only 80 82 84 86 fixed rate mortgage principal and interest Only Chicago Tribune graphic sources Baron financial group National association of realtors Page 14 the stars and stripes Divide the Cost of refinancing by the monthly savings to determine the number of months it will take refinancing to pay off. If you plan to be in your Home for considerably longer than that it May pay to get rid of that costly old mortgage. Sunday april 6, 1986 surging sales in Northeast associated press Boston is red hot. So is metropolitan new York. Houston is warming. Many other cities too Are now claiming resurgence in real estate helped along by dropping mortgage rates. At the same time a few cities remain left out of the Boom and in a City like Boston with very expensive housing some individuals Are still left out of the Market. A Survey released recently by the National association of realtors pointed to the Northeast As the Region where Home sales and prices surged most in the last three months of 1985. The median Cost of an existing Home in Boston Rose to $144,800 in that period up 38.2 percent Over the same period in 1984 and the biggest jump among 42 metropolitan areas surveyed. After Boston came new York and its suburbs where housing costs Rose 29.8 percent Syracuse n.y., 21.4, and Providence r.i., 18.4. Houston was in fifth place with the Cost up by 15.1 percent. The realtors said the Northeast s Strong financial services and High technology industries helped Send prices up while nationally Home prices Rose a modest 3.8 percent in the period. Across the nation $74,700 was the median Price for an existing House. Home sales declined in eight states the weakness concentrated in farm areas and those depressed by the Oil Industry slump. Home sales dropped 26 percent in Louisiana for the period while South Dakota Iowa Kansas Nebraska. Idaho Montana and Oklahoma also saw declines. Real estate and development officials around the United states report an upturn in housing Market activity including refinancing and Home building As mortgage rates have gradually dropped and especially since rates fell below 10 percent in recent weeks. But some places remain left out. Tulsa okla., Home sales Are Flat lenders report and Terrence Bagley senior vice president at Continental Federal savings in Oklahoma City said our sales activity has been  refinancing have been brisk in both cities. We re being cautious said Bob Muzzy who operates a construction company in Wichita kan., where single family Home building permits dropped to 15 in january of this year compared to 33 last january and 88 in january 1984. We re not going to be sticking our necks  around Albuquerque n.m., subdivisions Are developing rapidly from Mesa and jackrabbits to paved roads just blink your eyes and that s it As one builder put it. But then there Are places like Hobbs n.m., near the Texas line where the scant loan activity is blamed partly on sliding Oil prices. Cities touting themselves As winners in the current housing Boom include greater Nashville where Low interest rates Are compounding the Success of Industry recruiters who have attracted among other prizes general motors Saturn corp. Plant to nearby Spring Hill Tenn. Indianapolis boasts of being a boo town and the National association of realtors Survey agrees giving the City and its suburbs much of the credit for Indiana s 81.4 percent increase in seasonally adjusted Home sales for the last three months of 1985, tops in the nation. Said David Wilcox vice president of the Indianapolis based real estate firm . Tucker co last year we were saying How it can t get much better than it is now. But it has gotten  unfortunately As prices have risen in places like Boston where a one bedroom Back Bay apartment with a View of an Alley can go for $140,000, some would be buyers Are left out. There s no question conceded Jim Oates president of new orld Bank in Boston. I m sure that there Are cases where people still can t buy because of the extremely expensive housing  for Many the Only solution is to Settle in suburbs an hour from the City then Cope with an hour Long commute. Others said Charles Ferraro of the Bank of new England try to Bridge the affordability Gap by getting extra jobs or buying a House with rental property. The stars and stripes Page 15