How to Save Money on Hot water This Summer

One simple way to reduce the cost you spend each month on hot water starts with washing your cloths.

Unlike dishwashers, clothes washers don't require a minimum temperature for optimum cleaning. Therefore, to reduce energy costs, you can use either cold or warm water for most laundry loads. Cold water is always sufficient for rinsing.

Inefficient clothes washers can cost three times as much to operate than energy-efficient ones. Select a new machine that allows you to adjust the water temperature and levels for different loads. Efficient clothes washers spin-dry your clothes more effectively too, saving energy when drying as well. Also, front-loading machines use less water and, consequently, less energy than top loaders.

Small-capacity clothes washers often have better EnergyGuide label ratings. However, a reduced capacity might increase the number of loads you need to run, which could increase your energy costs.

If you want to ensure that your new clothes washer is energy efficient, purchase one with an ENERGY STAR label.

Important Dates for Home Buyers

The Clock Is Ticking...
Important Dates Home Buyers Need to Know About

"There's no place like home," so the famous saying from The Wizard of Oz goes. And this year, that saying applies to many new home owners, as first-time home buyers (FTHBs) have accounted for 53% of total residential real estate purchases during parts of 2009. For those of you who have already bought a home, congratulations. For those of you still waiting, this is a call to action: It's time to get moving.

While it's true that the best environment home buyers have ever seen may have been from January to late May of this year, outstanding opportunities still exist for those who act soon. If you are planning to buy a home, there are important dates on the calendar that you need to take note of so you can act accordingly. These dates represent money-saving opportunities for consumers.

We May Never See Rates This Low Again
Beginning in late November last year, 30-year fixed rates plunged into the mid 4.0% range. So what prompted this precipitous decline? The Federal Reserve announced that they would start purchasing mortgage backed securities (MBS) issued by Fannie Mae, Freddie Mac and Ginnie Mae. The Fed made this decision because there was a lack of liquidity and buyers in the fixed income securities market. By becoming a buyer for the securities that determine interest rates, the Fed helped lower rates to stimulate the economy by absorbing supply not picked up by others in the markets.

Following the announcement by the Federal Reserve, home loan rates immediately responded, falling a full percentage point. When the buying started, home loan rates fell even more, sparking a frenzy in refinancing and buyers seeking financing.

However...and here's what you need to note...this program implemented by the Federal Reserve has a deadline! That deadline is December 31, 2009. And as the Federal Reserve has been the primary buyer for MBS, purchasing up to 85% of all MBS since March, the impact to rates when the program ends could be as dramatic as when the program was announced. This means that interest rates could conceivably rise to well above 6.00%.

In the month leading up to the announcement, interest rates had been exceptionally volatile, peaking on some days near 7.00% for a 30-year fixed rate loan with no points and fees. This kind of volatility often happens when investors are reluctant to purchase MBS and trading volumes in securities are light, causing rates to rise quickly if investors demand a higher return for their investment.

While the final impact to interest rates will have to play itself out, one thing is certain: without the Federal Reserve as a primary buyer of MBS, home loan rates could be primed for a spike if other investors do not pick up the slack that could result in 2010.

It is unlikely that interest rates will return to the sub-5.0% range again this year. Why? The purchase and refinance mortgages that have already occurred this year were packaged into Mortgage Backed Securities after they closed and were sold on the secondary markets. This added supply to the markets and the new Bonds simply outweighed what the Fed had allocated to buy. Still, the Fed's program is helping slow down the rate increases we are seeing...but remember; their program is due to end on December 31. That's why now could mark the lowest rates that will be seen for some time to come.

Would You Like $8,000? Buy a Home. Soon!
To stimulate the economy, Washington juiced up the stimulus plan passed last year in February. Two benefits for FTHBs were that the amount of the tax credit was increased from up to $7,500 to $8,000. And, more importantly, the amount of the credit does not have to be repaid!

To qualify for the credit the individuals buying a home cannot have owned a home in the last three years. So, while the credit is discussed as a credit for first-time buyers, anyone who has not owned a home in the last three years is eligible.

There are income limitations to fully qualify but they are quite liberal. Single tax filers earning up to $75,000 and joint filers earning up to $150,000 based on modified adjusted gross income can earn the full credit. A partial credit is available for those earning up to $95,000 and $170,000 respectively.

The amount of the tax credit is based on a percentage of the price of the home, specifically 10% of the purchase price, up to $8,000. This means if someone purchases a home for $70,000 their credit would be $7,000 and if the amount of the home purchased is $100,000, the credit would max out at $8,000.

Note! The deadline to take advantage of this opportunity is November 30, 2009. Close in December, and you just lost $8,000.

Homes Have Never Been More Affordable
FTHBs are leading the way, taking advantage of one of the best home buying opportunities ever, providing support for the real estate market. As indicated earlier, FTHBs have accounted for as much as 53% of purchases for any month this year.

Who can blame them? In short, no one. Home prices have fallen to levels not seen in years and interest rates hit their lowest point ever. This combination led to the highest home affordability ever recorded.

The National Association of Realtors® tracks what is known as the Home Affordability Index. The Home Affordability Index is arrived at as a function of both median home prices, available interest rates, and median family income.

The index represents the amount of monthly income that is required to pay a mortgage payment. In 2005, approximately 23.3% of a family's monthly income was required to carry a mortgage payment. With falling home prices and interest rates, the percentage of monthly income required to pay a mortgage payment is now approximately 15%.

This means that for a family at the median income level purchasing a home priced at the median income level, the monthly mortgage payment has declined nearly 36%! This is great news for anyone shopping for a home today.

Get Busy, Time is Short!
In order to take advantage of both the available tax credit and low interest rates, anyone going into contract should strive to have their purchase agreement not later than mid-October. This will allow some time cushion in the event anything pops up in the purchase process and still allow for closing in time to take advantage of the available tax credit.

Home prices have fallen to levels not seen since the start of the decade in many parts of the country, interest rates are still near all time lows, and the availability of free money from the IRS all mean that the time to act is now. It is always easy to look back and identify times people should have acted, and this could well be one of those times people will look back and say, "Wow, I should have bought a home in 2009!"

The ABC's of Water Safety

A is for Adult: Adults need to have constant eye-to-eye contact with children around all forms of water (pools, bathtubs, buckets, toilets, canals, etc…) More than two thirds of children who drown in Arizona were not even expected to be near the pool. A toddler can drown in as little as 2 inches of water. Always, make sure you designated an adult to watch children when they swim in the pool.

B is for Barrier: Supervision is critical but can sometimes fail. To prevent a drowning, multiple barriers should be placed between kids and water. Barriers can include pool fences, alarms, door and window locks that are out of children's reach, and self-closing, self-latching hardware on doors. Barriers around other forms of water include lids on buckets, locks on bathroom doors and toilet locks.

C is for Classes: For adults, this means CPR classes taken regularly to keep your skills fresh; for children at the appropriate age, this means swimming and water safety classes. Every family should learn what to do in an emergency.

Be safe this summer and practice the ABC’s of water safety!

National REALTOR.com® Homeownership Survey Results

Maricopa County June 2009 Statistics

Need a Vacation? Want to Escape AZ Heat?

Escape to Rocky Point Mexico, a quick 3 1/2 hour drive from Phoenix. You deserve a weekend getaway and what a great way to beat the Arizona heat! Bask in the clear ocean waters of Sandy Beach, collect sea shells with your kids, lounge on the lazy river all day......Your vacation options are limitless in Mexico at the best resort in Rocky Point, Las Palomas! Visit www.HammanVacations.com for more details, pictures, and bookings.

Best U.S. cities to buy a home

While the overall housing market isn't on the upswing, these metros show long-term potential. According to a recent Forbes article, the top 10 cities in the U.S. to buy a home are:

1. Denver
2. Boston
3. Phoenix
4. San Diego
5. Los Angeles
6. St. Louis, Mo
7. Tampa
8. Philadelphia
9. San Francisco
10. Washington, D.C.