The year-end median price in Broward was $186,000, compared with $179,200 in 2010.

The number of homes for sale countywide declined sharply in 2011. Increased demand for fewer homes helped to stabilize prices, but real estate agents and analysts warn that the market may not hit bottom until 2013.

In Palm Beach County, the median price last year was $193,700, off 15% from 2010.

Meanwhile, sales soared in both counties as foreign investors and other cash buyers rushed to take advantage of prices last seen in 2002.

Broward had 12,817 existing home sales for the year, up 11% from 2010. Palm Beach County rose 24% to 11,900.

Home sales nationally last year increased slightly from 2010.

Lawrence Yun, chief economist for the National Association of Realtors, said in a statement that the nation’s housing market is slowly recovering from the downturn that began in 2006.

He concludes: “The pattern of home sales in recent months demonstrates a market in recovery. Record low mortgage interest rates, job growth and bargain home prices are giving more consumers the confidence they need to enter the market.”

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1. Buyers will be busy. Despite sluggish national numbers, South Florida sales were strong in 2011.  Furthermore,  economic conditions and consumer sentiment will continue to improve during this election year.
2. Foreclosures will increase. Analysts are concerned about the 1 million in “shadow inventory” — homes that ultimately will go on the market for sale because the owners are in default or foreclosure.
3. Prices will soften. More foreclosures will bring down prices across the board, but declines may be limited to 3 to 5%. Which means, values will stabilize.
4. Interest rates will remain low. Count on historically low mortgage rates for as long as it takes to get the economy back on track.
5. Short sales will increase. Banks appear more willing to let owners sell for less than they owe, helping to clear the glut of “underwater” mortgages.

*** And starting in 2013, homeowners will be taxed on the amount the lender forgives, meaning more homeowners will be motivated to do deals.

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It was the fifth consecutive week that the 30-year fixed loan was below 4.00%.

According to Freddie Mac, the average 30-year, fixed-rate mortgage declined from last week’s 3.95%. Average interest rates on 15-year, fixed rate home loans were also down slightly to 3.23%, after last week’s 3.24%  rate. A year ago, the interest rate on the 15-year loan was nearly a point higher at 4.13%.

Frank Nothaft, Freddie Mac vice president and chief economist, states: “Fixed mortgage rates started the year a little lower this week just as recent data reports indicate the housing market and manufacturing industry are showing signs of improvement.”

According to Freddie Mac, total upfront costs this week for both the 30-year and 15-year, fixed-rate loans averaged .8% of the price of the home being bought. The buyers may also pay closing costs, which are not included in the survey.

However, many buyers won’t get Freddie Mac’s low average rates, Money magazine reported in its December issue. One of the reasons is that Freddie Mac’s low rates require high credit scores and down payments of 20% or more. Freddie Mac spokesman Wandler goes on further to add that Freddie Mac’s average low rates also require more upfront fees than what some consumers are used to paying.

Good news for “underwater” homeowners! Starting tomorrow, they can start submitting applications under a revised government program meant to make refinancing easier.

The Obama Administration announced this fall it’s making changes to the Home Affordable Refinance Program so more struggling homeowners can take advantage of it.

The government is doing away with a cap that prevented borrowers whose mortgages exceed 125% of the value of their homes from being eligible for the program. Other changes include reduced risk for lenders and lower fees for borrowers.

Furthermore, Fannie Mae now says it will allow some homeowners to refinance even if they’ve had a foreclosure in the past seven years.

Paton wishes more people knew about the program, saying it’s the best opportunity yet for homeowners to get out of underwater mortgages and refinance into 15-year loans without a huge hit to their monthly budgets.

According to research by Corelogic, the revamped program potentially could help tens of thousands of homeowners in South Florida who owe far more than their homes are worth. More than four out of 10 residential properties with a mortgage in Broward and Palm Beach counties are underwater.

While tomorrow is the official launch date nationwide, some lenders may not be prepared to accept applications right away.

Among the criteria homeowners must meet:

• They need to be current on their mortgage payments.

• The loans must be backed by Fannie Mae or Freddie Mac, the government-run companies that guarantee about half of all home loans nationwide.

• The loans must have been bought by Fannie or Freddie no later than May 31, 2009.

To find out if your loan is owned by Fannie, click here. To see if it’s owned by Freddie, click here.

As of February, 2.7 million homeowners who received mortgages from 2004 to 2008 have lost their homes to foreclosure.  It estimates that 3.6 million households remain in serious jeopardy of losing their homes. The report states:  “It is notable that these serious delinquencies represent only a sub-set of likely foreclosures ahead, since they do not include foreclosures on loans originated (outside of 2004 to 2008) or those that are not yet at imminent risk.”

Two other bullet points from the study, based on an analysis of 27 million mortgages originated from 2004 to 2008:

• Florida leads the nation with 17.4 percent of first mortgages on owner-occupied homes that are seriously delinquent or in foreclosure.

• Foreclosure rates are worse for homeowners who took out risky loans touted before the housing bust.

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The agency concluded in a statement: “The bottom line: The foreclosure crisis isn’t going away. Families that could have benefited from homeownership are instead being kicked down the economic ladder, home prices keep falling and economic recovery remains stalled. Many home losses have been and will be unnecessary. With so many losses still ahead, lenders must end loan servicing abuses and get serious about sustainable loan modifications that keep families in their homes.”

To be eligible for the program homeowners must:

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• Submit a purchase agreement from a buyer to Bank of America by November 30, 2011 and close the transaction before August 31, 2012.
• The home must have a Bank of America first mortgage.
• There cannot be a previous or existing offer on the home.

For further information, homeowners are advised to contact Bank of America at 877-459-2852.