Items of Interest - April 29, 2006

SALES OF PREVIOUSLY OWNED HOMES TICK UP: They edged up in March following a strong rebound in February, according to the National Association of Realtors (NAR). Total existing-home sales - including single-family, townhomes, condominiums, and co-ops - rose 0.3 percent to a seasonally adjusted annual rate of 6.92 million units in March, but they were 0.7 percent below the previous March. Commented David Lereah, NAR's chief economist: "It's a good sign to see home sales holding close to the level of a strong rebound in the month before. This is additional evidence that we're experiencing a soft landing. We may see some minor slowing in home sales as interest rates rise, but the market clearly is stabilizing." Lereah expects 2006 to be the third strongest year on record for home sales. He said that appreciation's cooling to single-digit rates of price growth was "another sign that the market is normalizing." The national median existing-home price for all housing types was $218,000 in March, up 7.4 percent from March 2005, when the median was $203,000. Total housing inventory levels rose 7.0 percent at the end of March to 3.19 million existing homes available for sale, representing a 5.5-month supply at the current sales pace. Single-family home sales rose 0.3 percent to a seasonally adjusted annual rate of 6.07 million in March from February and were 0.5 percent below the pace in March 2005. The median existing single-family home price was $217,300, up 7.8 percent from a year ago. Existing condominium and cooperative housing sales increased 0.2 percent to a seasonally adjusted annual rate of 854,000 units in March but were 2.0 percent below the pace a year ago. The median existing condo price was $225,500 in March, up 6.1 percent from last March.

NEW HOME SALES UP FROM FEBRUARY, DOWN FROM LAST YEAR: New single-family homes were up 13.8 percent in March, following an 11 percent decline the month before, reports the U.S. Commerce Department. However, sales for the first quarter 2006 were down 9.7 percent from the fourth quarter of 2005, and year-to-date sales were down 8.2 percent from the year before. "Month-to-month changes in the new-home sales series are notoriously volatile, but the quarterly pattern of sales is reasonably in keeping with other housing indicators, including NAHB's surveys of single-family builders," said Chief Economist David Seiders of the National Association of Home Builders (NAHB). "This longer-term pattern is consistent with the orderly cooling down process we've been anticipating, as affordability problems and reduced investor demand bring home sales down from the unsustainable levels of 2005." According to Commerce Department figures, new-home sales rose to a seasonally adjusted annual rate of 1.213 million units in March. However, the sales pace was 1.159 million units for the first quarter as a whole, down from 1.283 million units for the last quarter of 2005 and down from 1.249 million units for the first quarter of last year. The inventory of new homes for sale rose to 555,000 units at the end of March, a 5.5 months' supply at the current sales pace. Of that total, for-sale units that were not yet started showed the largest increase and represented 20.2 percent of the inventory. Units still under construction were almost 57 percent of the inventory, and completed homes for sale were 23 percent of the total - about the same as a year earlier.

CAVEAT EMPTOR: In a helpful article about shady contractors, the Washington Post provides these warning signs from the National Association of the Remodeling Industry and the Better Business Bureau that serves metropolitan Washington: You can't verify the contractor's name, address, telephone number or license/insurance information; the salesperson tries to pressure you into signing a contract or tells you a special price is available only if you sign the contract immediately; the contractor solicits door to door and says he has materials left over from a previous job; the company or salesperson says your home will be used for advertising purposes so you will be given a special low rate; the contractor balks at reasonable requests for references; information you receive from the contractor is out of date or no longer valid; the contractor asks you to get the required building permits; you are asked to pay for the entire job in advance, or to pay in cash to a salesperson instead of by check or money order to the company itself; the company cannot be found in the telephone book, or is not listed with the local Better Business Bureau or with a local trade association; and the contractor does not offer, inform or extend notice of your right to cancel the contract within three days. Notification in writing of your right of rescission is required by law.

LIGHT READING: Find out about home safety and comfort from AARP and Home Depot, which have published five brochures that also include how to prepare yourself, your family and your home for a disaster. The brochures are titled "Hallways," "Bathroom," "Kitchen," "Lighting" and "Are You Prepared." You can download them in English or Spanish at aarp.org/homedepot.

SURVEY FINDS THAT SETTLEMENT SHEETS ARE NORMALLY LATE: In a new nationwide survey of real estate agents, 50 percent said their biggest gripe was the absence of HUD-1 closing documents for review a day ahead of the settlement, according to Kenneth Harney in the Washington Post. The HUD-1 is the form that lists settlement charges. Real estate agents told pollsters that although "required by government regulations," settlement sheets rarely arrive in advance, thereby denying home buyers an opportunity to see an itemized list of all their charges and fees. The study was sponsored by a lending industry newsletter, Inside Mortgage Finance, and conducted by market researchers Campbell Communications and Geosegment Systems Inc. A statistically representative sample of 1,780 real estate agents participated in the polling. Although real estate agents and consumers may believe that federal rules guarantee them the right to see the final closing numbers a day ahead of settlement, that's not completely accurate. Washington lawyer Phillip L. Schulman of Kirkpatrick & Lockhart Nicholson Graham, said in an interview that the law requires a closing agent to provide a borrower the HUD-1 figures one business day in advance only "if the borrower requests" such a review. Equally important, said Schulman, the closing agent is only required to "provide whatever figures [the agent] actually has received up until that time" from other parties involved in the transaction. "The fact is that some of these numbers come in very late in the process," just hours or even minutes before the scheduled settlement, Schulman said. Another widely misunderstood point: The federal agency that regulates real estate settlement procedures has no enforcement powers when closing agents fail to provide advance copies of the HUD-1 to consumers who request them.

ON THE MARKET, KEROUAC'S FORMER HOME IS SOLD: The Cape Cod dwelling sold this week for $300,000 to buyers who said they weren't familiar with the Beat Generation author or his work, says the Associated Press in Realtor magazine. Kerouac, known best for his 1957 novel "On the Road," bought the Hyannis, Mass., home in 1966. Shortly afterward, he was married to his third wife, childhood friend Stella Sampas, in a ceremony in the living room. A year later, Kerouac moved back to his hometown of Lowell, Mass. He died two years later at age 47 in Florida of complications resulting from alcoholism. The 1,344-square-foot, single-story house on Bristol Avenue in Hyannis was originally on the market for $356,000.

STATUS HAS ITS PRICE: What's the difference between 11962 and 28741? When it comes to house prices, the answer is $2,125,000, answers Forbes magazine. Those ZIP codes bookend the publication's annual list of the priciest areas in the country - neighborhoods where home costs soar far above the norm. The top 500 most expensive zip codes in the U.S. include the most famous (perhaps the only famous) ZIP in the country, Beverly Hills, 90210; some towns that are well-known for harboring ritzy residents; and neighborhoods that few besides locals have ever heard of. The most expensive ZIP codes are, for the most part, at the ocean's edge, in lush valleys and on hillsides with magnificent views. They're well stocked with golf courses, country clubs and private docks. California zips took up just over half the space on the Forbes list. New York was also big, taking up about 20 percent of the rankings; the rest was taken up by places such as Massachusetts, Connecticut, Arizona and Maryland. They were mainly ZIP codes in upscale suburbs close to urban power centers or places where the wealthy vacation. Sagaponack (11962), located in the tony Hamptons, tops the list, with a median home price last year of nearly $2.8 million. Several other Hamptons zips also make the list, as do Southern California retreats and plenty of Lake Tahoe and Florida locales. In Fairfax County, the 22066 zip was in 84th place on the national list and, with a median of $1.09 million, the most expensive zip in the county. In D.C., 20015 was number 330 on the list with a median sales price of $750,000. Maryland's Montgomery County had zip 20816 in 79th place with a median of $1.105 million. For more info, copy and paste this URL into your browser: forbes.com/lists/2006/04/17/06zip_most-expensive-zip-codes_land.html.

PROPERTY TAX RATES CUT IN FAIRFAX AND ALEXANDRIA: But bills will rise. Supervisors in Fairfax voted to reduce the rate by 11 percent, to 89 cents per $100 of assessed value, reports the Washington Post. But the owner of a house assessed at $540,746, for example will owe $4,812 in property tax, which is $328 more than this year. In Alexandria, the rate cut passed by the City Council was 10 cents, down to 81.5 cents. A homeowner with a $526,852 assessment will see taxes increase by an average of $259 to $4,294.

THE DEPARTMENT OF INDESCRIBABLE EXCESS: Homeowners who have gone to great lengths to design a modern home with a minimalist look don't want their kids' toys to ruin the aesthetic, observes the Wall Street Journal. Enter the mod playhouse. Designers, manufacturers and retailers who've recently introduced sleek furniture for kids are now moving out to the yard. At Velocity Art and Design, a furniture retailer in Seattle, the new Modern Playshed for the Eames-in-training crowd went on sale last month. The 88" x 44" birch plywood unit has Dutch doors and can be customized with a deck, chalkboards, whiteboards and colorful plastic panels. But like all prefab structures, there's assembly required. This one takes at least two hours, according to the company, and requires the help of an illustrated assembly manual, plus a carpenter's bag worth of tools - including a caulk gun. And at $2,995, it costs more than many of the retailer's grown-up furnishings. Design Within Reach's kids' line, DWRjax, which launched last October, sells the austere Nume Cardboard Activity House ($110). Some experts are also enthusiastic about the minimalist approach. "A boring white box is a fabulous toy, since it encourages children to create their own space," says Roberta Golinkoff, a University of Delaware professor of psychology specializing in child development. Lilliput, a manufacturer of luxury playhouses based in Finleyville, Pa., sells 12 styles of playhouses, including Tudors and Victorians. But some 5 percent of customers request custom versions of their own full-size residences, some of them very modern, according to company spokeswoman Patty Toner. Whether the house in question is a Neutra or a Frank Gehry, "we'll build it," she says. Price? From $13,000 to $35,000. And how much would an old cardboard box cost anyway? Or even a new one?

SINGLE? GO AWAY: The Denver-Boulder metro area is America's best city for singles, opines Forbes magazine. Topping its list for the second consecutive year, the Mile High City edged out larger metros, thanks to its booming job market, relatively low cost of living and large university population. D.C. which was in second place in 2004 slipped to fifth. The magazine's fifth annual listing of America's Best Cities for Singles ranks 40 of the largest metropolitan areas in six different categories: nightlife, culture, job growth, number of other singles, cost of living alone and coolness. Boston is now second, followed, in order, by San Francisco and Raleigh-Durham.

YOU CAN GET A FREE BMW FOR MANY THOUSANDS OF DOLLARS: Forget about free plasma TVs, gift cards or upgraded cabinets. What about that free BMW Z4 Roadster that just popped up in ads for a new Fairfax County condo? suggests the Washington Post. "Ask how to receive a FREE BMW Z4 Roadster or 325i," says the ad in newspapers and on the Web for Legato Corner, a six-building complex being built near Fair Oaks Mall by Texas developer Fairfield Residential. Builders are using more incentives in a softening market, but a car is a rarity. It's "definitely different, and much more eye-catching than just saying 'no condo fees for a year,'" said Tim Liu of condo guide DClofts.com. But hold your horsepower. Developers of the 202-unit complex aren't actually giving away the $38,000-and-up sports car or its $32,000-and-up four-door cousin. Buyers of two- or three-bedroom units get a free two-year car lease, according to a sales representative who said she was not authorized to comment publicly. Two-bedrooms start at $356,900 and three-bedrooms at $408,900, according to the complex's Web site. While leasing is not quite the same as owning a Beamer, it's nothing to be sniffed at: BMWs lease for around $400 a month for 30 or 36 months, with a $2,500 down payment plus taxes and tags, said Alberto Zamorano, a salesman at VOB BMW in Rockville.

MORTGAGE APPLICATIONS CONTINUE TO SLIDE: The Mortgage Bankers Association says volume decreased of 3.7 percent on a seasonally adjusted basis for the week ended April 21 from one week earlier. On an unadjusted basis, the drop was 3.2 percent compared with the previous week and 22.4 percent compared with the same week a year ago. Purchase applications fell by 4.4 percent from the previous week, and refinancings went down by 2.4 percent. Seasonally adjusted, purchase applications were at the lowest level since Nov. 7, 2003. The refinance share of mortgage activity increased to 36.7 percent of total applications from 36.4 percent the previous week, and the adjustable-rate mortgage (ARM) share declined to 28.2 percent.

DON'T COUNT THESE PLANTS OUT WHEN THEY'RE IN: It used to be that yellow leaves meant the plant was sick and likely to die. These days, notes the Wall Street Journal, it is more likely to mean the plant is trendy. Golden-leafed trees, shrubs and perennials are getting a push by horticultural companies, magazines, catalogs and garden designers. Their pitch: Yellow foliage can light up a shady area of a garden, bring variety to masses of green and guarantee color when flowering plants have dropped their blooms. Nevertheless, some of the biggest names in the garden business are going for the gold. This season Monrovia, a major commercial plant grower, is introducing a variety of the popular shrub spirea with yellow foliage, as well as the first yellow-leafed astilbe, a shade-loving perennial with plumes of fluffy flowers. Monrovia says it offers about 25 percent more gold-leafed plants than it did five years ago. White Flower Farm added seven plants this season that have yellow leaves instead of the usual green, including a redbud tree named Hearts of Gold and a smokebush dubbed Golden Spirit. Wayside Gardens now sells a hydrangea called Lemon Daddy with bright yellow leaves that contrast smartly with its big pink or blue blooms. And new to the Klehm's Song Sparrow catalog is a pagoda dogwood with yellow leaves called Gold Bullion. But some of the yellow flora don't stand up to cold as well as the same variety with green leaves and don't grow as fast. Moreover, yellow foliage may not retain its distinctive color all season.

COMPETITION IN TITLE INSURANCE INDUSTRY IS SCRUTINIZED: In a 24-page report, the U.S. Government Accountability Office (GAO) finds that home buyers seldom shop for title insurance, according to Inman News. Like, duh. The report was released prior to U.S. House Financial Services subcommittee hearing on competition, pricing and recent probes of illegal activity in the title insurance marketplace. The GAO report found that underlying costs are not always reflected by quoted premium rates. "For example, most states do not consider title search and examination costs - insurers' largest expenses - to be part of the premium, and do not review them," the report said. It pointed out that few states regularly collect information on title agents and the extent to which they are regulated is "unclear." Another "unclear" area is the amount of competition in the industry. Consumers generally don't comparison shop for title insurance, relying on industry professionals' advice, and "the benefit to consumers is not always clear," the report said. In addition, the GAO found that "real estate brokers and lenders are increasingly becoming full or part owners of title agencies, which may benefit consumers by allowing one-stop shopping, but may also create conflicts of interest." Finally, "multiple regulators oversee the different entities involved in the title insurance industry, but the extent of involvement and coordination among these entities is not clear," the report continued.

D.C. HAS A DUBIOUS DISTINCTION REGARDING INSURANCE: Among the 10 most expensive states, include one that is not usually subject to tornadoes, hurricanes or earthquakes. According to the National Association of Insurance Commissioner, the District of Columbia was fifth with an average annual premium of $806, reports Forbes magazine. Why? It is said that Washington has a dense population with plenty of unstable structures and is considered by insurers to be at a higher risk for terrorism.

MORTGAGE RATES CONTINUES TO RISE: The 30-year fixed-rate mortgage (FRM) averaged 6.58 percent for the week, up from last week's 6.53 percent and last year's 5.78 percent, says Freddie Mac. The 30-year FRM has not been higher since the week ending June 20, 2002, when it was 6.63 percent. The 15-year FRM this week was 6.21 percent compared with the prior week's 6.17 percent 5.33 percent a year ago. The 15-year FRM has not been higher since the week ending May 31, 2002, when it was 6.22 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) were 6.21 percent, up from last week's 6.16 percent last year's 5.20 percent. One-year Treasury-indexed ARMs were 5.68 percent versus 5.63 percent the previous week. At this time last year, the one-year ARM averaged 4.21 percent. "Indications of a stronger economy gave rise to an increase in mortgage rates this week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Consumer confidence and existing home sales unexpectedly rose. Much of this strength is attributed to a healthy labor market, which translates into greater consumer spending. This should support an active housing market over the next few months. We expect mortgage rates to gradually rise throughout the year. A stronger labor market, coupled with moderation in house price growth, means our outlook for overall housing conditions remains upbeat."

MAKE A BEELINE FOR THE ARBORETUM: There, the Garden Fair and Plant Sale will enable you to shop for shrubs, perennials, vines, ground covers and trees that have been chosen for their superior ornament and suitability to the area's climate. Horticulturalists have gathered more than 1,000 varieties of plants for the sale, which will be under tents. The event is open 9 a.m. to 4 p.m. this Saturday, April 29. For lists of plants and other details, visit fona.org, the Web site of Friends of the National Arboretum.

WHEN WILL IT EVER STOP: Probably never. After two days of wandering the acres of stainless steel and tempered glass at the Kitchen and Bath Industry Show, Deborah Baldwin of the New York Times reports that she rushed home to assure her stocky white refrigerator that it had nothing to worry about. One day that willowy counter-depth refrigerator with climate controls, air and water filtration systems and superchill option will be old news, too - one day soon, at the rate things are going, says she. With Americans pouring $111 billion into kitchen and bath renovations this year, the demand for new products is seemingly insatiable. Some 900 exhibitors turned the trade show into a vast mall packed with Euro appliances, glistening fixtures and oddball options, addressing some longings people don't even know they have. "They are looking for anything that will differentiate them," said Alex Cheimets, the editor of the industry insider Web site applianceadvisor.com. In a sea of Sub-Zero lookalikes, one $2,900 refrigerator, for release by Sears in September, offered unexpected neo-retro lines. Gaggenau weighed in with a $6,500 refrigerator-freezer with motorized shelves (to levitate the ketchup?). Don't laugh. When was the last time you heard about a refrigerator dying a natural death? Millions of people pull the plug every year to make room for a new one, just because they can. Wall ovens, which used to last longer than most marriages, are losing shelf life as they gain French doors and easy-glide "ladder racks." If you sprang for the 2005 Speed model by Miele, welcome to buyer's remorse. TurboChef just rolled out a wall oven that cooks so much faster. It's cuter, too. Faster, cuter, bigger, better - the race is on to dazzle with new options and aesthetics.