Real Estate Information

Once you’ve decided to buy a beautiful Prairieville home, the big question is  “How much house can I afford?”

You may already have a figure from the bank If you have gone to get pre-approval.  This may be more or less than what you had in mind. It’s only a starting point in your thought process.  The perception is that bank puts the upper limit on what you can spend, but the lender may not take into account everything you need to consider.

How Much Can You Afford?

Some lenders use different percentages to figure out how much should go for housing, but the most common guide to how much you can afford these days is based on the 28/36 rule.  The means your housing should be 28% or less of your gross income before taxes, while your debt (not including your mortgage) should be 36% or less of your income.  Based on an income of $60,000, you might be able to append about $1,400 a month on your mortgage, taxes, and insurance, but this would dip to $1,000 if you paid about $650 about for credit cards, car payment, and other loans.  (Click here for a handy 28/36 mortgage calculator to compute how the 28/36% rule would work out for you.)  Banks may use a magical formula based on your FICO score, but they are considering similar things: how your debt compares to your income.

With a household income of $120,000, your might be able to pay $2,800 for housing with no debt.  What if your spouse is laid off?  Do you have resources to help you make it for a while?  What if one spouse wants to stay home with the kids? What if your salary stays the same but your other expenses keep increasing?  Will you be able to handle increased energy costs if the home is bigger than your old residence?  A mortgage you can technically afford can become a noose around your neck.

Bottom line, you need to be honest with yourselves. If you are saving for your kids’ college or trying to keep them in private schools as well as number of expensive activities, a big house payment can cut off other life options unless your income increases.

Don’t Sacrifice It All For Your Down Payment

You can reduce the amount of the loan and the monthly payment by putting more money down.  It is a mistake to raid retirement funds ordeplete savings.  Experts say you should have three to six months savings on hand in case of job loss, plus about 5 % of the purchase price of your home as a cushion for emergencies and repairs.  In addition, you may need about 3-5% of the amount of the purchase price for closing costs and moving expenses. 

The last thing you want to do is buy a house that develops a leaky roof six months down the road that you can’t afford to fix.  You are better off putting down less down payment – even if that means you buy a less expensive home or consider FHA financing, as that requires a smaller down payment. At this time, it seems like that an extension of the first time homebuyers tax credit is likely in some form, so you can probably plan on some assistance for either your downpayment or other move-in expenses.

Since home price and interest rates low, this is great time to buy an affordable house – but not to overextend yourself.  Talk to Sandy Sandlin today about buying a Prairieville home  Sandy’s Team will give the most to date information about the status of the first time homebuyers credit, as well about the best properties in East Baton Rouge, Ascension, and Livingston Parishes.

This is a proud October for the 21 schools of Ascension Parish.  As a whole the district was named the fourth best school system out of 70 in the state, while 17 of the 21 schools improved their individual performance. 

The Ascension Parish district scored 105.09 in state performance scores.   This score was the district’s highest score ever and represents a 6.1% increase over last year.  Superintendent Donald Songy praised the “exceptional commitment and expertise of … teachers, administrators, and of staff” that resulted in this year’s success and laid the groundwork for “a pattern of steady growth from year to year.”  

Further, he noted the “the level of growth this year.provides us with reassurance that the strategic initiatives set in place are producing results and fostering an improved education for all our students.”  Assistant Superintendent Patrice Pujol added that Ascension had moved to the top due to high level assessments aligned with the Districts’ curriculum and teachers’ instructional practices.

Particularly noteworthy are the achievements of these schools:

12.6 point increase- Lowery Intermediate School.  For the second straight year, this school showed the larger improvement in the district and now has moved into the academically acceptable range.

12.5 points – Dutchttown High School

11.2 points - G.W. Carver Primary School

9.7 points – St. Amant Middle School

8.7 points – Galvez Primary

8.2 points – Donaldsonville High

7.6 points – St. Amant High

6.6 points – East Ascension High

6.3 points - Prairievile Middle

6.0 points – Dutchtown Middle

Seven other schools also shows great improvement, which qualified 17 schools to receive a Growth School Performance Score of 100 or more.  For more information on the progress of the Ascension School District over the years, see www.apsb.org/schoolscores.

As noted in our previous blog Top Schools Districts Attract Buyers to Greater Baton Rouge Area, 10 years ago, the State of Louisiana set out to improve school performance state-wide.  In 2009, nearly 80% of schools showed gains in their scores, while 43% met their growth targets this year vs. only 25% last year.  Twenty eight percent of schools exceeded an SPS of 100; the percentage of schools with scores under 100 decreased from previous years. Additionally, the number of Academically Unacceptable Schools (AUS) fell from 90 to 55, or 4.3 percent.

This good news on school performance is one more reason why buying a home in Ascension parish is a great investment for your family. When buying real estate in Louisiana., contact Sandy's Team  for the best properties in East Baton Rouge  and Ascension Parishes. 

If you are looking to start a business, particularly in high tech, Baton Rouge is a great place to come.  Ranked at #9 on CNN Money’s Best Place to Launch a Business in mid-sized metro areas, Baton Rouge offers a combination of young engineering talent, tax incentives, and quality of life that pulls in new entrepreneurs.

Between 2004-2007, the small business growth rate was 9.3%, as compared to 5.92% for other “Best Places.”  In 2007, this translated to 16,860 new small businesses with 1-49 employees.  Much of the growth was in the technology sector, as engineering and construction firms settled in the state capital to work on post-Katrina restoration projects, some with Federal Go Zone funds.  To further promote business, the State of Louisiana approved tax incentives of up to 40% for firms that do research and development in the state, as well as 35% of the state income tax for digital media companies.

Some of the new business were developed to provide services and housing to the increasing population.  After Hurricane Katrina in 2005, Baton Rouge experienced a large population increase when displaced hurricane victims moved in.  Some returned home but the region has retained an 11% population growth.

As the location of Louisiana State University, Southern University, and Baton Rouge Community College, Baton Rouge has a pool of educational talent. Some 28% of the population has bachelor’s degrees, which make for an educated workforce.  Average hourly wage for workers in the Baton Rouge area is $17.89, as compared to $18.35 in other “Best Places.

A key thing that attracts small business – and their customers – to Baton Rouge is the quality of life, marked by Louisiana cooking and a growing social nightlife scene.  In an inviting business client, such amenities, coupled with a comfortable pace of life, make workers happy to stay put in Baton Rouge.

Well before Katrina, the Baton Rouge Chamber of Commerce embarked on The Campaign for a Greater Baton Rouge to promote the nine parishes in the region (Ascension, East Baton Rouge, East Feliciana, Iberville, Livingston, Pointe Coupee, St. Helena, West Baton Rouge, and West Feliciana) as an economic unit.  The group hoped to broaden the economic appeal of the area to more than the petrochemical industry.  The recent accolades from CNN Money indicates that Baton Rouge is well on the way to becoming a more diversified

Looking for a place to call home in the Baton Rouge area?  Sandy’s Team at Re/Max Excellent Properties, headed by veteran Realtor® Sandy Ogburn Sandlin, are local experts in East Baton Rouge/ Ascension Parish real estate.  Our new website presents the homes you will want to call yours in Prairieville, Baton Rouge, and the other fine communities in the area. Contact Sandy today for the blend of friendliness and professional competence that have made us area leaders in real estate.

You can fall in love with a house anywhere the greater Baton Rouge area, but when you finally make the move, the house located where the schools are the best is where you put down your money.  That's why the latest report from the Louisiana Department of Education is great information for people looking to settle in the East Baton Rouge-Ascension Parish region.  You don't even necessary have to go the most expensive area to find a home either, as great valued are available whatever your price range..

With a goal of 100% accountability in important measures of student performance, several area school districts exceed that goal for 2009.  These include:

Zachary Community School District (116.8)

Zachary, LA in East Baton Rouge Parish has been the top performing district in Louisiana for the past five years.  Fourteen miles north of Baton Rouge and 80 miles northwest of New Orleans, Zachary is a small town with a high percentage of college graduates. 

West Feliciana Parish (110.9)

St. Francisville, LA in West Feliciana Parish has second highest top scores. The town of 1,600 people is located 30 miles northwest of Baton Rouge and about 100 miles northwest of New Orleans.

St. Tammany Parish (109.6)

Slidell, LA, roughly 30 miles north of New Orleans, is the main city in St. Tammany Parish.  The schools are top notch, offering Advanced Placement and Honors classes at all schools.

Ascension Parish (105.9)

One of the fastest growing parishes I Louisiana, Ascension Parish  reached its highest performance level ever and improved its scores by 6.1% district-wise for all schools

Overall scores for all districts is 91% this year.  This represents as 4.7% improvement since 2008 and a 22% increase since 1999, when performance levels stood at 86.3%.  At that time, the state fared poorly in comparison to other states to other states , so assessment measure were developed to be accomplished within 10 years.  The sate falls a little short of its goal, but the 16% increase in performance very encouraging.

According to State Superintendent of Education Paul Pastorek, "This progress is a tribute to the administrators, teachers and students in our classrooms and represents the good work of many individuals and organizations over many years,"

"We are very pleased by these gains - among the highest we've seen in the history of accountability. And in comparison to the last several years, where for the most part we saw marginal gains, a gain of nearly 5 points reinforces our efforts and tells us that many superintendents are focusing on the right things and are moving in the right direction."

The scores are actually reflect several measures, depending on the grade level. For grades K-8, School Performance Scores (SPS) are calculated for K-8th grade schools using student test scores (90%) and attendance (10%). Schools with a 7th and 8th grade configuration receive a SPS based on attendance (5%), dropouts (5%) and student test scores (90%). High schools (grade 9-12) receive an SPS based on test scores (70%) and their graduation index (30%).

District Scores include student permanence on standardized tests (LEAP, iLEAP and GEE), along with as attendance, dropout and graduation outcomes - calculated using the same formula as School Performance Scores - but using only one year of data.

Over the past school year, 65% of student scored Basic or above on statewide -administered assessments as compared to 45 in 1999.  There is still a considerable gap of 23.4 points between races on the assessments, but the gap has narrowed by 10.3% in English and 9.8% in

In 2009, nearly 80% of schools showed gains in their scores, while 43% net their growth targets this year vs. only 25% last year.  Twenty eight percent of schools exceeded an SPS of 100; the percentage of schools with scores under 100 decreased from previous years. Additionally, the number of Academically Unacceptable Schools (AUS) fell from 90 to 55, or 4.3 percent.

Despite achievements, which have resulted in higher scores on college admission tests , Louisiana is committed to bringing all children up to basic and closing performance gaps between races.  For more information about Louisiana's education efforts, view the LDOE press release.

Now that the public school system in many parishes are proving  to be an even better  choice for buyers, finding a place where  achievement is high is one of the priorities while buying real estate in Louisiana.  Contact Sandy's Team  for the best properties in East Baton Rouge  and Ascension Parishes. 

Three is the magic number for homeowners who want to claim the $8,000 tax credit for buying their new home.  That's the number of years it must have been since you owned your last home to qualify for the credit.  If you owned a home in the past, as long as three years have passed, start shopping!  The new credit will give you an $8,000 head start.

The first time homebuyer's credit sounds like it only applies to you if you are 25 and looking for your starter home.  In reality, it can apply in any of these scenarios:

• When you retired a few years ago, you moved to an apartment.  You want to be homeowner again.  Go for it!
• You moved to Prairieville a few years ago from up North.  You weren't sure where in the Baton Rouge area you wanted on locate, so you've been renting a place ever since.  You know more about the area now and are prepared to buy.  Go for it!
• After you'd owned a home for a while, you found that your income at the time wasn't enough to cover the extra maintenance costs sometimes involved in home ownership, so you went back to renting. Now, three years later, you are in a better position to face unexpected challenges, so you want to buy again.  Go for it!
• Back in 2005 or 6, you mother was ill, so you sold your home and moved in with her.  Now, she's passed on and you want a place that reflects your taste.  You love those new condos over at the Quarters at Dutchtown and really want to buy.  Go for it!
• When you were married, you owned a home.  When you got divorced four years ago, you sold the home and moved back home.  Now, you are ready to own again.  Go for it!

It doesn't matter what got you out of homeownership three years ago.  As long as you or your spouse have not owned a home for three years, you are considered eligible to get a 10% credit on your home up to a maximum of $8,000..  Of course, you must be creditworthy and not exceed income limits of $75,000 to $95,000 for singles and $150,000 to $170,000 for couples.  The credit is a true credit that does not have to be repaid so long as you keep the home for three years.

Sandy Ogburn Sandlin and her team would like to help you realize your dreams of home ownership - or "re-realize" them if you are reentry homebuyer with that magic three years since you last owned a home.  Contact Sandy's Team today for the best in East Baton Rouge, Ascension or Livingston parishes.

There was a time when a prospective homebuyer could be pre-qualified to purchase a home and everyone involved - the buyer, the seller, and the real estate agent - was confident that the deal would sail through the bank.  The buyer and seller planned for a closing date.  Since the passage of HERA, the Housing and Economic Recovery Act of 2008, obtaining a mortgage involves full pre-approval. 

What's the difference between pre-qualification and pre-approval?  With pre-qualification, the homebuyer would state their income and assets and advised if they were likely to qualify for a loan and for how much.  Pre-approval requires the applicant to submit documents such as a photo ID, most recent W-2's, current pay stub (possibly for the last 6 months),statements from savings or investment accounts, and maybe even information on any other outstanding loans and credit card balances.  The lender will pull a credit report and submit the information through an automated pre-approval process to obtain a maximum amount you can borrow.

Once the would-be buyer finds the home of his dreams - or the one he can afford according to the bank - he has to then wait for the lender to process a final approval.  At that point the application comes before a human underwriter who can approve or even deny the loan based on the information, the appraisal on the home, or any changes that have occurred.

This tougher approach is a reaction to the sub-prime mortgage crisis and the lending practices that precipitated it.  Much of the HERA regulation was an attempt to help homeowners whose payments had increased beyond their ability to pay, perhaps due to deceptive lending practices.  For new borrowers, the act added more steps

What does all of this mean to you as a buyer?  The intended effect is that you will get a loan you can afford on a home you can afford. However, getting the loan will be harder as the requirements to qualify have escalated, while the process will take longer.  In theory, a greater awareness of your loan terms and home value is a positive thing.  However, the new standards for being approved might throw you off track in a couple ways. If you have a good but not great credit score per the new guidelines, you are likely to get a mortgage but will have to pay more for it.  You might even be denied your loan at the last minute, especially if your appraisal comes in too low or something has changed since you were pre-approved.  

If you are thinking about buying a home, now is the time to confer with your agent and set into motion your plans to be homeowner.  Sandy Ogburn-Sandlin and her team of agents can walk through the loan process and help you find your new home in Baton Rouge and other communities in East Baton Rouge, Ascension, and Livingston counties.

I'm often asked if this is a good time to buy a home. Some clients are concerned that home prices may fall further than they have already. They are assuming that the best course of action is to wait for the bottom in the market and then buy. The problem with this approach is that you don't know where the bottom is until you see it in the rear view mirror, meaning until you've missed it!

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates go up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.