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Dream Big!

Census Says
Home to 300 Million and Growing

The U.S. population hit 300 million in October—and the Census Bureau expects a surge in the country’s population to 400 million in just 35 years, with immigrants accounting for most of those newcomers. With about 86 people per square mile nationwide, the United States would seem to have plenty of room for more, but where will these new Americans live?

As it grows, the population is increasingly concentrated in just a dozen states. And North Dakota, Ohio, Michigan, Kansas and Nebraska are either losing population or staying even.
The Center for Environment and Population, a nonpartisan research group, calculates that more than half the population live within 50 miles of the coasts, and half of these new residents will join them. But other areas with reasonable housing costs will become a draw, and there are signs that’s already happening. For example, the foreign-born population of Tennessee has grown 140 percent in the past five years, while in both Idaho and Utah that segment of the population grew by 10 percent—twice the rate of the nation as a whole.

Survey Says
Up in ARMS?

A recent Associated Press (AP)-AOL Real Estate Poll of homeowners with adjustable-rate mortgages (ARMs) found that more than one-third (36 percent) of those surveyed worried that they wouldn’t be able to afford their monthly mortgage payments if their interest rates increased. But, at the same time, 64 percent said they were not concerned about such a scenario.

The poll also found that those who believed that housing prices would go up were more likely to have ARMs than those who thought prices would go down or stay the same.

According to the Mortgage Bankers Association, of all U.S. home-owners with a mortgage, 24 percent have an adjustable rate while 76 percent have a fixed rate.

The AP-AOL poll also found that about a third (35 percent) of likely future buyers said they would seek an ARM to finance their home purchase.

People most likely to seek ARMs are first-time homebuyers, those with less education and lower incomes, unmarried adults and minorities, according to the poll.

The AP-AOL Real Estate poll of 2,001 adults, including 289 recent homebuyers and 401 likely future homebuyers, was conducted by telephone last September by Ipsos. The poll had a margin of error of plus or minus 2 percentage points for all adults, 6 percentage points for recent homebuyers and 5 percentage points for likely future homebuyers.

Eye on Crime
Homeowner Identity Thieves

An identity theft ring that has been targeting property owners, mortgage lenders and the title insurance industry in recent months appears to be an international scheme. Many of the suspects appear to be of Eastern European origin. The ruse involves absentee-owned property and includes both vacant land and improved residential and commercial properties.

In most of the reported cases, the true owners reside outside Florida. Here’s how it usually plays out:
The perpetrators assume the identity of the real property owner and obtain a physical mailing address (always a mail-drop location) in a community near the residence of the property owner. They then contact a mortgage broker or lender as well as a title agent to originate and close a new refinance mortgage loan using the identity of the owner.

After receiving loan approval from a mortgage lender, the perpetrators then contact the title agents and request that they either transmit the closing documents to one of their (free) e-mail addresses or the mail-drop address. After the executed closing documents have been returned to the title agents, the perpetrators provide written instructions for the agents to wire the loan proceeds to bank accounts held outside the United States, mostly in Eastern European countries.

For tips on spotting mortgage fraud, see Know the Law.

Baby Boomers, Real Estate and Retirement

Most of the nation’s 78 million baby boomers are far from retirement and have diverse plans and timelines for leaving the workforce. This results in different housing requirements and significant shifts from patterns established by earlier generations, says a comprehensive study by the National Association of Realtors® (NAR).

“The differences from past generations—and between baby boomers themselves—will have a significant impact on housing needs over the next 10 to 20 years that’s very different from the World War II generation, and many boomers simply don’t know how they’ll retire,” says David Lereah, NAR’s chief economist. He explains that baby boomers are living longer than (and in a different way from) previous generations because they have no set path for retirement and have more varied life circumstances.

The survey of nearly 2,000 baby boomers born between 1946 and 1964—the largest generation in U.S. history—was a study by Harris Interactive for NAR.

“A significant portion of baby boomers married later in life and had children at a later age, which means many will continue to work beyond the traditional retirement age,” adds Lereah. “Older boomers are thinking about retirement, but one-third expect to go back and forth between periods of work and periods of leisure, and another 35 percent want to work at least part time or start a business. All of this will have an impact on the kind of homes they buy as well as where they buy them.”

The median age at which baby boomers expect to stop working is 70, but 27 percent say they never intend to quit.

Lereah points out that most baby boomers are currently in the workforce, a good portion have children living at home and boomers remain a driving force in the housing market. “Because they’ll be in the workforce longer, boomers will postpone purchase of retirement property and won’t be making those moves as early as assumed,” Lereah continues.

Customer Tip
Mortgage Primer Pamphlet

Are your homebuyers confused about the array of affordable mortgage products that sound too good to be true? Then this may help: a pamphlet jointly released by five bank, thrift and credit union regulators. The 17-page document, available on the agencies’ Web sites and downloadable in PDF format, discusses nontraditional mortgage products, such as interest-only and adjustable-rate loans. The list of terms and worksheet should help consumers determine which type of loan best suits their needs. The regulators say consumers also can turn to lenders if they have questions about the risks of various lending options. To download the brochure, go to