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You have spent weeks possibly months marketing your home in the Kenai Real Estate market and have finally found a willing buyer. After some back and forth you have agreed upon a price and repairs and are ready to close. The only item standing in the way of the seller’s freedom and the buyer’s new home is the appraisal. Surprise, after all that time, work, money and drama the appraisal came back lower then your sales contract price.
Appraisers in the Kenai – Soldotna real estate market are very conservative; they are not going to push any boundaries.
It helps to remember that the purpose of the appraisal is to protect the banks/investors. It is not meant to help a buyer and seller negotiate the sale of the property. This can be a shock for unprepared sellers and buyers. Just because you have a willing buyer and a willing seller at a given price does not mean the appraisal will support the price.
Here is the kicker, if the buyer has to finance a home purchase they need a partner or investor (Mortgage Lenders). The bank or investor gets to make the rules for the appraisal. Most Kenai home sellers and buyers fail to consider how the investor will influence the transaction. Lenders do not wish to be stuck with a home that is not valued correctly.
The most simplistic rule an investor has is that the property can be sold for as much as was loaned. The most important consideration in the appraisal is what similar properties are selling for in your area. The operative word is “selling”. What other homes are being marketed at does not influence an appraisal value. The Kenai and Soldotna Real Estate market is diverse with custom homes of all ages, styles and conditions. Appraisers often have difficulty finding similar homes that have sold recently within close proximity of your home. If they can’t find comparable home sales they will lower the value of the home, regardless of what the seller and buyer have negotiated.
Your local REALTOR Glenda and Jason Feeken are experts in the Kenai Real Estate market and the sales process. We can educate you on what homes are selling and appraising for so you can have a smooth transaction that closes. Contact us today to answer any questions you may have on buying or selling.
One-of-a-kind Soldotna log home on 120.71 acres w/ Soldotna Creek running through it. This Soldotna home offers a stunning rock fireplace and large windows to welcome in the VIEW. Watch wildlife, moose, bear, eagles, hawks and so much more. Land your plane on private runway with two hangers, barn, 4 cabins, caretaker’s cabin and detached garage. This would make a perfect corporate retreat or private residence. Call 907 283 5888 for more details.
The long standing policy that allows homeowners to deduct their mortgage interest payment from their income tax could become part of a “Fiscal Cliff” deal. The National Association of REALTORS (NAR) position is that the mortgage interest deduction is vital to the stability of the American housing market and economy. We all need to remain vigilant in opposing this or any future plan that would modify or do away with the deductibility of mortgage interest. Mortgage interest one of the last remaining deductions available to the taxpaying public.
Please take note and take action. Here is a link provide by NAR to let congress know this is not acceptable. Realtor Action Center: Please take action today. Pass the link on to friends and family to take action.
FHA has announced a major change to its loan program which allows Kenai home borrowers to cancel the mortgage insurance premium (MIP) when their unpaid balance reaches 78% of the original purchase price. While no specific date has been set for the change, sometime in 2013, new FHA loans will require the mortgage insurance for the life of the loan.
At existing rates, the monthly MIP on a $168,875 mortgage is $178.99 per month. Under the current rule with normal amortization, the MIP would no longer be required in 9 years and 9 months. However, under the new rule, it would last for the entire 30 year term.
They also announced that the annual MIP will also be increased from 1.25% to 1.35% at some point in the near future. HUD, the parent agency for FHA, is making the changes to restore the capital reserves of the program that are needed to fund failed loans.
People that can close a FHA loan before the change takes place will fall under the old rules for canceling MIP and the lower rates. Since no date was announced, it is not known exactly when the changes will take effect.
While this information will probably not make the evening news, it will have a big impact on borrowers planning to use an FHA loan. Please pass it on to anyone you know who might be considering purchasing or refinancing with a FHA loan.
This Year: 1/1/2012 to 10/10/2012
Last Year 1/1/2011 to 10/10/2011
|Number Sold - Last Year||Number Sold - This Year||PCT %||Average Sale Price - Last year||Average Sale Price - This Year||PCT%|
|300 - North Kenai||26||37||42||138,013||202,392|
|305 - Kenai||48||59||22||197,374||208,871|
|310 - Kalifornsky Beach||51||66||29||222,788||211,273|
|315 - S of Soldotna||12||8||-33||203,042||203,625|
|320 - Kasilof||19||15||-21||146,774||100,327|
|330 - Soldotna||41||35||-14||217,010||241,950|
|335 - Ridgeway||29||24||-17||244,271||292,496|
|340 - Sterling||39||38||-2||237,759||235,995|
|345 - Funny River||8||14||75||184,188||243,357|
The first ten months of 2012 have been more active than the same period in 2011 with an 8% increase in the number of properties sold and a 6% increase in the average sales price. The bulk of the increase in properties sold have been centered in North Kenai, Kenai and K-Beach, while other areas experienced a drop in the number of sales from the prior year. Most local markets have benefited from an increase in average sales price. North Kenai was the big winner for sellers with a 46% increase in average sales price.
Oil and gas exploration and production continues to be a positive economic force with a positive outlook for the next year. We are seeing increased interest in exploration in the inlet and other areas by independents producers. Several new gas wells are being drilled in Kenai. The gas storage facility has been completed and is ready to address peak winter demand. Interestingly we are seeing a surge in new commercial construction from North Kenai to Soldotna. We are very lucky to have oil and gas, along with tourism and commercial fishing to support our local economy.
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WHAT IS MIP?
What is this mysterious PMI and why does it effect your payment with MIP? Yes I know it.
Is private mortgage insurance and it adds to your monthly payment with mortgage insurance premium, but what is it for? Most first time home buyers in the Kenai, Soldotna, K-Beach and surrounding areas may think it covers them if they default on the mortgage, right. Sorry that is really not how it works. Private mortgage insurance is to cover a possible loss to the investor if the defaults and the property foreclosed upon. It does not relieve you the borrower of the debt owed our your obligation to repay.
Some mortgage insurance premiums are paid in lump sums other as a monthly payments. The premium is substantial and can last for years. So why would anyone pay for it? Private mortgage insurance allows many homeowners the opportunity to own when they otherwise would have been declined for a loan. It also allows for a lower down payment on most loans.
When considering a loan be aware that PMI varies substantial between loan programs and can vary within the same loan program dependent upon your cash down payment and credit score. When considering a loan ask your lender these four questions:
• Do I need private mortgage insurance?
• How much will it cost?
• Does the premium change if I place more money down?
• When will I stop paying the mortgage insurance premium?
We will keep you updated about real estate in the heart of the beautiful Kenai Peninsula. When I travel outside of Alaska, people ask “Where is Kenai?” Well that would be 150 miles south of Anchorage and 75 miles before the end of the road at spectacular Homer, AK. We invite you to come live and play on the Kenai! The Kenai River is home to world class King Salmon fishing, but don’t overlook the Reds, Silvers or trout. Hunting is a favorite hobby for many, although most say it is time spent with nature and friends that is the lure. Don’t be far from your camera. You never know when moose, bear, caribou, wolves, fox, eagles, swans or just stunning scenery will present itself. Hiking, biking, kayaking and boating are all at your doorstep. So come on over!
VIEW VIEW & MORE VIEW!! Of mountains, inlet & sunsets. Lots of windows, see-through fireplace, great kitchen, media room, family room, private master retreat. Come enjoy everything this home has to offer! Buyer to verify where lot ends before bluff. Buyer to verify all information. Square footage per KPB.
Looking for that beach front home that allows easy access to beach walks and stunning views of mountains, glaciers, beautiful sunsets, dancing northern lights and passing boats? All are easily viewed from this 3,568 sq. ft. home with four bedrooms, three baths, office & family room. The kitchen is a cook’s dream with large five burner WOLF stove, custom cabinets with pantry, dish drawers, dry storage, etc… Delight in the real wood floors in kitchen, living and dining room, cozy soapstone stove, very private master retreat with MILLION DOLLAR VIEW! The lower level bedrooms and family room also enjoy an INLET VIEW. Storage is no problem with a detached 700 sq. ft. garage set up for projects and adjacent shed. Don’t overlook the raised garden beds, small greenhouse, and fenced dog area with dog house that matches home. Breathtaking views are complimented by a nicely landscaped yard surrounding the home on 1.77 acres a short distance from Kenai or Soldotna.
This property was so great it recently SOLD.