By Scott Sloan - ssloan@herald-leader.com
The Lexington-Bluegrass Association of Realtors said home sales in and around Lexington grew in the third quarter, with September particularly strong. Residential sales rose 13 percent in Lexington and 7 percent in the region as a whole.
The growth for the full quarter, although lower, was still growth, which has been tough to come by as the real estate market suffered during the recession.
The number of residential real estate sales that closed during the third quarter in Lexington increased 4.7 percent, the Lexington-Bluegrass Association of Realtors said Thursday. In the 14-county area served by LBAR's members, single-family sales were up 4 percent.
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During the quarter in Lexington, 1,194 sales closed, up from 1,140 in the same quarter of 2008. Sales were gaining momentum as the quarter ended, with a 13 percent rise in September with 347 sales, 40 more than a year ago.
During the quarter in the region, 2,110 sales closed, up from 2,028 in the same quarter of 2008. Sales also gained momentum as the quarter ended with a 6.7 percent rise in September. That month saw 651 sales, 41 more than a year ago.
September is the first month this year that home sales in the region exceeded their 2007 figures, according to the data provided by LBAR's members.
Sales declined 0.7 percent in the region in August but were up 6.2 percent in July.
In Lexington, sales were up just 1.7 percent throughout July and August. The months are not broken out separately in LBAR's statistical report.
Year-over-year price changes varied during the quarter. Lexington saw a substantial decline in the median sales price for residential sales in September: The price fell 7.5 percent to $149,838 from $162,000 a year ago.
The region saw varied results. In July, the median sales price for residential homes was $147,398, down 1.7 percent year-over-year. In August, it fell to $144,000 from $152,900 in August 2008, a drop of 5.8 percent. In September, the percentage drop-off narrowed to 1.8 percent with a median sales price of $140,000.
Central Kentucky's drop in sales prices has not been as pronounced during the recession as other areas of the country.
The average days on the market for a single-family home in the region was 78 at the end of the quarter, down from 93 a year earlier. Lexington was better with an average days on market of 66 compared to 69 a year ago.
The inventory of homes also was down in the region, with 6,238 for sale in September 2009, a drop of 5.4 percent.
"Interest rates are very low; there is a good selection of homes on the market and there is no reason not to be able find the home of your choice," LBAR president Gale Fulton said in a statement.
Thursday, October 15, 2009
Friday, October 02, 2009
Does this Sound Familiar?
Not that I am for taking the horse farms and turning them into subdivisions, I am not, but maybe we could learn something from here in Central KY?
Urban planning to blame for housing bubble? - REAL Trends
Between 2000 and the bubble's peak, inflation- adjusted housing prices in California and Florida more than doubled, and since the peak they have fallen by 20 to 30 percent. In contrast, housing prices in Georgia and Texas grew by only about 20 to 25 percent, and they haven't significantly declined. In other words, California and Florida housing bubbled, but Georgia and Texas housing did not. This is not because people don't want to live in Georgia and Texas: since 2000, Atlanta, Dallas-Ft. Worth, and Houston have been the nation's fastest-growing urban areas, each growing by more than 120,000 people per year. According to a new study by the CATO Institute and Randal O'Toole, this suggests that local factors, not national policies, were a necessary condition for the housing bubbles where they took place. The most important factor that distinguishes states like California and Florida from states like Georgia and Texas is the amount of regulation imposed on landowners and developers, and in particular a regulatory system known as growth management. In short, restrictive growth management was a necessary condition for the housing bubble, says the study. Read more click here.
Real Trends Comment: Thomas Sowell's book, "Housing Boom and Bust" is one great read to understand how it was government involvement at all levels, local, state and federal, that was mostly responsible for both the boom and the bust in housing. At local and state levels, governmental action to reduce the land available for development and the cost of development caused huge price bubbles that exacerbated the wild swings in prices in such markets as San Francisco and Los Angeles when compared to cities like Atlanta and Houston. At the federal level the stimulus to accelerate low income households entry into homeownership caused Fannie and Freddie to purchase too many low downpayment and low credit scoring families - ending with the high foreclosure rates even before the recession.
Urban planning to blame for housing bubble? - REAL Trends
Between 2000 and the bubble's peak, inflation- adjusted housing prices in California and Florida more than doubled, and since the peak they have fallen by 20 to 30 percent. In contrast, housing prices in Georgia and Texas grew by only about 20 to 25 percent, and they haven't significantly declined. In other words, California and Florida housing bubbled, but Georgia and Texas housing did not. This is not because people don't want to live in Georgia and Texas: since 2000, Atlanta, Dallas-Ft. Worth, and Houston have been the nation's fastest-growing urban areas, each growing by more than 120,000 people per year. According to a new study by the CATO Institute and Randal O'Toole, this suggests that local factors, not national policies, were a necessary condition for the housing bubbles where they took place. The most important factor that distinguishes states like California and Florida from states like Georgia and Texas is the amount of regulation imposed on landowners and developers, and in particular a regulatory system known as growth management. In short, restrictive growth management was a necessary condition for the housing bubble, says the study. Read more click here.
Real Trends Comment: Thomas Sowell's book, "Housing Boom and Bust" is one great read to understand how it was government involvement at all levels, local, state and federal, that was mostly responsible for both the boom and the bust in housing. At local and state levels, governmental action to reduce the land available for development and the cost of development caused huge price bubbles that exacerbated the wild swings in prices in such markets as San Francisco and Los Angeles when compared to cities like Atlanta and Houston. At the federal level the stimulus to accelerate low income households entry into homeownership caused Fannie and Freddie to purchase too many low downpayment and low credit scoring families - ending with the high foreclosure rates even before the recession.
Wednesday, September 23, 2009
Extend or Not to Extend
I will make this short and sweet, which is unusual for me, but anyone either in the market to buy or sell, or a real estate professional has an opinion on this current first time buyer tax credit. Now to debate the actual effects of the credit, good or bad, or how it is or is not market manipulation or control at some level is beyond the scope of this post, no matter how well founded or accurate they may or may not be. But like the cash for clunkers this is indeed creating a real shift in demand at least in the short term. Again the long term effect will be another matter all togeher for another time. So here are the top 3 pros and cons as I see it as a real estate professional and a property investor. And my idea to continue the plan so there is no cash for clunker type hangover period should it expire as set to do so in a matter of weeks.
Pro's:
1. Stimulates many on the fence buyers to go ahead an purchase property now rather than later
2. Helps to reduce the inventory available and in theory stabilize prices in the target price range.
3. Gives real a tangible monetary benefit to the average person, not an untangible corporation or group
Con's:
1. Limited to the typical first time home buyer target market and price range which may not address problems that created the current climate
2. Artificial inducement to act may create hangover effect in the future and creates minimum expectation standard for the future, and which may arguably be the root of the problem in the first place
3. By creating a hard deadline creates problems by rushing to act by too much of a sense of urgency to act.
My solution:
Now the numbers are arbitrary and can and should be adjusted as required for area and budget reasons. But here is a plan I think could be introduced to extend and most importantly expand the current credit.
The Ty Brown Real Estate Stimulus and Recovery Act of 2009
- $8,000 Federal Tax Credit in the first year for ANY owner occupied purchaser to be given to the buyer similar to the same current guidelines, except open to ALL buyers.
- and additional $1,000 interest credit towards federal taxes for each of the next 6 years the purchaser remains in the home.
- $2,000 incentive to purchaser to make home more energy efficient should home be in need, again similar to current guidelines -or-
-$8,000 principal reduction credit for a current seller that must sell their home that in turn purchases a new home that will lower their monthly mortgage payment by at least 20%. Then they would not be eligible for the $8,000 credit but would be eligible for the $1,000 interest credit and energy efficiency credit.
So this would be a great deal for someone that wanted to sell their home and couldnt because the value has decreased. They could lower their price by $8,000, the buyer could still use the $8,000 toward the purchase, and both could go to a new home and use the remaining credits.
The two biggest hurdles are 1. Who would fund the $8,000 principle reduction, and 2. Again is this TOO much artificial stimulus in a open market....
Pro's:
1. Stimulates many on the fence buyers to go ahead an purchase property now rather than later
2. Helps to reduce the inventory available and in theory stabilize prices in the target price range.
3. Gives real a tangible monetary benefit to the average person, not an untangible corporation or group
Con's:
1. Limited to the typical first time home buyer target market and price range which may not address problems that created the current climate
2. Artificial inducement to act may create hangover effect in the future and creates minimum expectation standard for the future, and which may arguably be the root of the problem in the first place
3. By creating a hard deadline creates problems by rushing to act by too much of a sense of urgency to act.
My solution:
Now the numbers are arbitrary and can and should be adjusted as required for area and budget reasons. But here is a plan I think could be introduced to extend and most importantly expand the current credit.
The Ty Brown Real Estate Stimulus and Recovery Act of 2009
- $8,000 Federal Tax Credit in the first year for ANY owner occupied purchaser to be given to the buyer similar to the same current guidelines, except open to ALL buyers.
- and additional $1,000 interest credit towards federal taxes for each of the next 6 years the purchaser remains in the home.
- $2,000 incentive to purchaser to make home more energy efficient should home be in need, again similar to current guidelines -or-
-$8,000 principal reduction credit for a current seller that must sell their home that in turn purchases a new home that will lower their monthly mortgage payment by at least 20%. Then they would not be eligible for the $8,000 credit but would be eligible for the $1,000 interest credit and energy efficiency credit.
So this would be a great deal for someone that wanted to sell their home and couldnt because the value has decreased. They could lower their price by $8,000, the buyer could still use the $8,000 toward the purchase, and both could go to a new home and use the remaining credits.
The two biggest hurdles are 1. Who would fund the $8,000 principle reduction, and 2. Again is this TOO much artificial stimulus in a open market....
Tuesday, July 21, 2009
For more people, scales tip toward buying a home
By ALEX VEIGA, AP Real Estate Writer Alex Veiga, Ap Real Estate Writer – Tue Jul 21, 5:52 pm ET
For Aaron Carter, a musician who was struggling to fit a drum set, a piano and three guitars into his 600-square-foot apartment in Phoenix, the math on owning a home finally began to work in his favor.Rent for the apartment he shared with his wife: $615. Mortgage payment for a home with twice the space: $760. And the interest on a mortgage is tax-deductible. So they jumped at the chance to buy some elbow room."We figured that everything together, getting more space, getting out of the apartment life and also just the prices right now, it just was the perfect time for us as a couple" to buy, said Carter, 20.For Americans debating whether to buy or rent their homes, the scales are tipping toward ownership. Because of the slide in home prices, low interest rates and tax incentives, renters are realizing they could handle a mortgage for a just little more money.An Associated Press analysis of 45 metro areas finds the gap between the monthly mortgage payment on a median-priced home and the median rent has shrunk from $777 a month to just $221 in the past three years.It could mean a quicker end to the housing-market doldrums, as renters buy up unsold homes languishing on the market.In some metro areas, including Cleveland, Atlanta, Indianapolis and St. Louis, the gap was less than $100 a month. And home prices are expected to fall faster than rents this year, which means the gap should get even smaller.In once-inflated markets like Phoenix, Las Vegas and inland swaths of California and Florida, where prices have tumbled more than 40 percent, sales are rising because first-time homebuyers are snapping up bargain-priced homes.They are getting help from a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers who earn up to $75,000 a year, or $150,000 for a couple. The credit expires at the end of November.Cheap foreclosures in some of those markets are now drawing multiple bids. As supply and demand even out, home prices will eventually begin to rise. But for now buyers are having little trouble finding bargains.Jere Ross, an Air Force vehicle operator, and his wife recently bought a four-bedroom, 1 1/2-bath house in Zephyrhills, Fla., a Tampa suburb, for $86,500 rather than jump into another yearlong apartment lease.Ross, 23, used a Veterans Administration loan, which doesn't require a down payment, and got a 30-year mortgage at a fixed rate of 5.5 percent. His monthly payment comes to $700 a month, including property taxes and insurance — $110 less than he paid to rent an apartment nearly half the size."It just came to a point where we were just throwing our money away on rent," Ross said. "When it came to find out that we could own this house for, less than what we're paying in rent, it was a 'no duh!' kind of moment."The study, conducted for the AP by Marcus & Millichap Real Estate Investment Services, used prices for the first three months of this year.It calculated mortgage payments by assuming a 10 percent down payment, a 30-year fixed loan at 5.15 percent, and taxes and insurance that added up to 1.5 percent of the purchase price. It assumed borrowers used private mortgage insurance.While the analysis found the gap between what it costs to own and rent is shrinking, it's still too wide for millions who live paycheck to paycheck.Renters with jobs in the education, retail and transportation industries don't earn enough to rent the average two-bedroom apartment in many of these major cities, let alone buy, according to a recent study of 200 metro areas by the Center for Housing Policy.Renters who want to become homeowners also face the obstacles of scraping together a down payment and qualifying for the loan. And renters with a record of paying bills late will have a hard time getting a low interest rate."There's still those buyers that are having trouble getting financed," says Brad Snyder, an agent with ZipRealty in Las Vegas. "A lot of them are still just looking for that easy way in, and it's just not there."Homeowners also have to shoulder many costs renters don't face — association fees, insurance, some utilities. And there are still cities, among them San Francisco and Los Angeles, where it's usually still more affordable to rent — even though home prices have fallen more than 30 percent.Mike Sigal, a longtime renter in San Francisco, has looked at buying a home for the past couple of years. But buying one comparable to the two-bedroom, two-bath apartment he has now would cost more than $600,000, meaning the mortgage would far exceed his $1,800 rent."The math doesn't come out," said Sigal, 42, who runs an information services company. "I've got extreme value for my rent."Nevertheless, homes in some parts of country are more affordable than they've been in decades. Even Dean Baker, an economist who sounded early warnings about the housing bubble and sold his own condo in 2004, has come around.Baker, co-director of the Center for Economic and Policy Research in Washington, bought a five-bedroom house last month for $650,000, which he figures is about 20 percent below what it would have gone for at the peak of the market."We feel we got a pretty good deal," Baker said.By buying, he accepted the risk that he might lose money if home values keep dropping. "We'll probably end up more or less even," he said. "Depending how much further down they go."
For Aaron Carter, a musician who was struggling to fit a drum set, a piano and three guitars into his 600-square-foot apartment in Phoenix, the math on owning a home finally began to work in his favor.Rent for the apartment he shared with his wife: $615. Mortgage payment for a home with twice the space: $760. And the interest on a mortgage is tax-deductible. So they jumped at the chance to buy some elbow room."We figured that everything together, getting more space, getting out of the apartment life and also just the prices right now, it just was the perfect time for us as a couple" to buy, said Carter, 20.For Americans debating whether to buy or rent their homes, the scales are tipping toward ownership. Because of the slide in home prices, low interest rates and tax incentives, renters are realizing they could handle a mortgage for a just little more money.An Associated Press analysis of 45 metro areas finds the gap between the monthly mortgage payment on a median-priced home and the median rent has shrunk from $777 a month to just $221 in the past three years.It could mean a quicker end to the housing-market doldrums, as renters buy up unsold homes languishing on the market.In some metro areas, including Cleveland, Atlanta, Indianapolis and St. Louis, the gap was less than $100 a month. And home prices are expected to fall faster than rents this year, which means the gap should get even smaller.In once-inflated markets like Phoenix, Las Vegas and inland swaths of California and Florida, where prices have tumbled more than 40 percent, sales are rising because first-time homebuyers are snapping up bargain-priced homes.They are getting help from a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers who earn up to $75,000 a year, or $150,000 for a couple. The credit expires at the end of November.Cheap foreclosures in some of those markets are now drawing multiple bids. As supply and demand even out, home prices will eventually begin to rise. But for now buyers are having little trouble finding bargains.Jere Ross, an Air Force vehicle operator, and his wife recently bought a four-bedroom, 1 1/2-bath house in Zephyrhills, Fla., a Tampa suburb, for $86,500 rather than jump into another yearlong apartment lease.Ross, 23, used a Veterans Administration loan, which doesn't require a down payment, and got a 30-year mortgage at a fixed rate of 5.5 percent. His monthly payment comes to $700 a month, including property taxes and insurance — $110 less than he paid to rent an apartment nearly half the size."It just came to a point where we were just throwing our money away on rent," Ross said. "When it came to find out that we could own this house for, less than what we're paying in rent, it was a 'no duh!' kind of moment."The study, conducted for the AP by Marcus & Millichap Real Estate Investment Services, used prices for the first three months of this year.It calculated mortgage payments by assuming a 10 percent down payment, a 30-year fixed loan at 5.15 percent, and taxes and insurance that added up to 1.5 percent of the purchase price. It assumed borrowers used private mortgage insurance.While the analysis found the gap between what it costs to own and rent is shrinking, it's still too wide for millions who live paycheck to paycheck.Renters with jobs in the education, retail and transportation industries don't earn enough to rent the average two-bedroom apartment in many of these major cities, let alone buy, according to a recent study of 200 metro areas by the Center for Housing Policy.Renters who want to become homeowners also face the obstacles of scraping together a down payment and qualifying for the loan. And renters with a record of paying bills late will have a hard time getting a low interest rate."There's still those buyers that are having trouble getting financed," says Brad Snyder, an agent with ZipRealty in Las Vegas. "A lot of them are still just looking for that easy way in, and it's just not there."Homeowners also have to shoulder many costs renters don't face — association fees, insurance, some utilities. And there are still cities, among them San Francisco and Los Angeles, where it's usually still more affordable to rent — even though home prices have fallen more than 30 percent.Mike Sigal, a longtime renter in San Francisco, has looked at buying a home for the past couple of years. But buying one comparable to the two-bedroom, two-bath apartment he has now would cost more than $600,000, meaning the mortgage would far exceed his $1,800 rent."The math doesn't come out," said Sigal, 42, who runs an information services company. "I've got extreme value for my rent."Nevertheless, homes in some parts of country are more affordable than they've been in decades. Even Dean Baker, an economist who sounded early warnings about the housing bubble and sold his own condo in 2004, has come around.Baker, co-director of the Center for Economic and Policy Research in Washington, bought a five-bedroom house last month for $650,000, which he figures is about 20 percent below what it would have gone for at the peak of the market."We feel we got a pretty good deal," Baker said.By buying, he accepted the risk that he might lose money if home values keep dropping. "We'll probably end up more or less even," he said. "Depending how much further down they go."
Tuesday, June 30, 2009
Breaking News!
For the first time I have noticed in a long time, and yes its the last day of the month, and quarter, but pendings and solds, and even solds along have surpassed new listings. At least as of 4:21 pm. Note there are even 5 price increases...watch out!
LBAR
24-Hour Market Watch
New Listings 70
Back on Market 11
Price Increases 5
Price Reductions 53
Pendings 38
Solds 80
Expireds 19
Inactives 18
LBAR
24-Hour Market Watch
New Listings 70
Back on Market 11
Price Increases 5
Price Reductions 53
Pendings 38
Solds 80
Expireds 19
Inactives 18
Asbestos and Insulation Tips
Kentucky Home Safety Tips & Asbestos Prevention
Purchasing or moving into a new home is the investment of a
lifetime. It will insure you and your family will have a safe and
healthy home for a long foreseeable future. However, it is also time
where additional responsibilities will be brought into your life.
Having the assistance of a reliable and honest Kentucky real estate
agent will make all the difference in the world.
Asbestos Tips
Used throughout the 20th century to insulate pipes, boilers and in
roofing, asbestos gained recognition due to its resistance to heat and
electrical conductivity. Homes built before 1980 may still contain
asbestos. Its main uses were found as insulation, piping, brake lining,
flooring and roofing. Asbestos exposure incidents in Kentucky have
mainly occurred as a result of industrial sites.
If asbestos is located, it must be left un-touched until a
professional can provide a course of action. In many situations, the
best action is no action. Asbestos that is disturbed or damaged due to
age is known as "friable" asbestos. This is a concern because its toxic
fibers can easily circulate and become inhaled.
Frequent and long term exposure to asbestos has been known to cause asbestosis and sarcomatoid mesothelioma,
two forms of asbestos lung cancer. Asbestos-related illnesses may not
appear until 20 to 50 years after exposure and may have symptoms which
are commonly found with less serious illnesses. This makes mesothelioma diagnosis even more difficult for physicians.
Sometimes, the best action is no action. If asbestos removal is
necessary, it should be performed by licensed abatement contractors who
are trained in handling toxic materials. The Kentucky Division for Air Quality strives to protect the environment and civilian health by monitoring and assisting in the disposal and removal of asbestos.
Green = Healthier and Cost Efficient Homes
Recently, congress passed the American Recovery and Reinvestment
Act. Included in this act were extensions to the tax incentives placed
for energy efficiency in 2005, as well as new credits for homeowners
who remodel or build using eco-sustainable methods. This promotes
incentives for home or business owners who implement green building
methods into their property.
Many locations throughout the United States are swiftly changing
their construction practices to suit the environment and the health of
human beings. Promoting new ways of building construction and
insulation, there are new regulations being put on older methods which
are now known to be harmful.
Most people are unaware to the fact that eco-friendly products can
cut energy costs by 25 % per year. These include the use of cotton
fiber, lcynene foam and cellulose. These alternatives have the same
flame resistant, durable qualities of asbestos, except they are
eco-friendly and safe.
Conducting a study in 2003, the United States Green Building Council
also reported a savings of $50 to $65 for green constructed buildings.
Rather than expensive and mal-treated wood, interior walls can be made
from steel and concrete, avoiding many of the problems associated with
asbestos and other insulation methods.
Jesse Herman
National vs Local Stats
Local vs. National News
OK once again I am going to say it, All Real Estate is Local, meaning I don't really care what Las Vegas is doing, and I REALLY do not care about California. So why is it that that is all we hear about? Florida is a little closer to home, and well New York is understandable, but still not relavant to Lexington, or Kentucky for that matter. However we have to realize this is what our clients see everyday. Like the article on Yahoo today...Home prices post 18.1 percent annual drop in AprilWidely watched index shows home prices down by 18.1 pct. in April, but trend is stabilizing Case-Schiller? Again that is only 20 cities, and none of them are in Kentucky. Plus it says that 8 of the 20 posted gains. WHO CARES ABOUT VEGAS!? But this seems to contradict what NAR says...Take a look at the recent local KAR and LBAR numbers to see what is happening in Kentucky and Lexington. Which one of these makes more sense to you and your clients who may be selling or buying a home? So share it...
OK once again I am going to say it, All Real Estate is Local, meaning I don't really care what Las Vegas is doing, and I REALLY do not care about California. So why is it that that is all we hear about? Florida is a little closer to home, and well New York is understandable, but still not relavant to Lexington, or Kentucky for that matter. However we have to realize this is what our clients see everyday. Like the article on Yahoo today...Home prices post 18.1 percent annual drop in AprilWidely watched index shows home prices down by 18.1 pct. in April, but trend is stabilizing Case-Schiller? Again that is only 20 cities, and none of them are in Kentucky. Plus it says that 8 of the 20 posted gains. WHO CARES ABOUT VEGAS!? But this seems to contradict what NAR says...Take a look at the recent local KAR and LBAR numbers to see what is happening in Kentucky and Lexington. Which one of these makes more sense to you and your clients who may be selling or buying a home? So share it...
Friday, June 05, 2009
What to Look for On Your First Investment Property
Here is a repost of a past article that I find very helpful still....
What to Look for On Your First Investment Property
I have already given you my 5 tips to make an investment purchase profitable.
But until you have done several deals, you may not know how to decide how to make the first one. So here are the things I look for in the property itself, the actual physical real property. Here are the 11 things I consider when I buy a property and again there are others, and there can be limitless different scenarios, which is why I think you must consult a professional Realtor to help. But here is what I look for and what I tell me clients to look for. —Disclaimer this should not be considered in any fashion a replacement for a full property inspection by a licensed professional or inspector. Please have this done on ANY property you consider especially the first few. Any real estate professional can help you include that language in your contract, regardless of the seller. Auctions can be an exception so use caution.
1. Easy cheap fixes – Is a home not selling because it has a bad paint job? Old outdated wall paper, is dirty, or needs landscaping? These are easy inexpensive fixes that can be a good buying opportunity. Always plan to repaint any home you buy to re-sell, its and easy cheap way to make almost any home look better. Pay particular attention to curb appeal and the entrance and little things like door knobs, lighting, and light switch covers.
2. Kitchen – Old cabinets fixtures and appliances are a big expense, but often necessary. If the kitchen is a wreck it can be an opportunity to add value and possibly get a better deal. If the space is good however they are a great investment. If they are in good shape and in working order that is a big, big plus.
3. Flooring – I love to see old worn out carpet over hardwood! 8 out of 10 times if you can see hardwood you can refinish it and make it look nice. Pet stains are a big problem sometimes, but a lot of people like the used antiquy (sic) look of older hardwood. Beware that many homes seem to have one bedroom that has something other than hardwood under there, I am not sure why but they do VERY often, so always plan to re-carpet the bedrooms.
4. Windows – The worse the better. Nothing makes a home look and sell better than new clean high efficient windows. Unless they have been replaced in the last few years plan to rip them out and replace them.
5. Heat and Air Units – Look for newer units with good brand names! If they are old they are costly to replace. Remember the new 13 SEER regulation, the old ones soon may not be able to be fixed even if they are not real old.
6. Foundation – Look for cracks and undermining of the soil around the foundation particularly near the down spouts. These are generally bad, and expensive to fix. Small cracks are usually OK, as all concrete will crack, but displaced, shifting, diagonally cracked blocks are usually not good.
7. Layout – Not only the room dimensions but the layout and style. In my opinion ranches are the best bet to start, as they are pretty straight forward and less can go wrong. But often the bathrooms or kitchens are deficient. However this is often easily fixed, but again it costs money so keep that in mind.
8. Lot/parking – Consider the slope of the yard and how useable it is, fencing and privacy are good. Looking around to see what is behind and around the house is also important. Is there sufficient parking?
9. Electrical – Look for an updated service panel in an older home, and check to see if any panel is full, old school fuse boxes are usually not a good idea. This could mean that you have to spend good money to be able to add circuits or could be a dangerous situation. This is best left to a professional licensed professional but a quick look can go a long way initially.
10. Plumbing – This can be especially tricky in vacant homes that may or may not have been winterized. Frozen pipes are usually not discovered until too late. Also pay attention to the tub or shower, one that appears to be in good shape can save a lot of money as it can be saved.
11. Roof – If there is any doubt about the integrity of a roof plan to replace it. The key is to find a nice looking flat roof, with no missing, bent, or damaged shingles. Always look in the attic for signs of leaking and on the ceiling. Leaks are not always bad if you can find the source and repair them easily. Also since you are doing the roof it’s a good idea to have new gutters and downspouts put on too.
What to Look for On Your First Investment Property
I have already given you my 5 tips to make an investment purchase profitable.
But until you have done several deals, you may not know how to decide how to make the first one. So here are the things I look for in the property itself, the actual physical real property. Here are the 11 things I consider when I buy a property and again there are others, and there can be limitless different scenarios, which is why I think you must consult a professional Realtor to help. But here is what I look for and what I tell me clients to look for. —Disclaimer this should not be considered in any fashion a replacement for a full property inspection by a licensed professional or inspector. Please have this done on ANY property you consider especially the first few. Any real estate professional can help you include that language in your contract, regardless of the seller. Auctions can be an exception so use caution.
1. Easy cheap fixes – Is a home not selling because it has a bad paint job? Old outdated wall paper, is dirty, or needs landscaping? These are easy inexpensive fixes that can be a good buying opportunity. Always plan to repaint any home you buy to re-sell, its and easy cheap way to make almost any home look better. Pay particular attention to curb appeal and the entrance and little things like door knobs, lighting, and light switch covers.
2. Kitchen – Old cabinets fixtures and appliances are a big expense, but often necessary. If the kitchen is a wreck it can be an opportunity to add value and possibly get a better deal. If the space is good however they are a great investment. If they are in good shape and in working order that is a big, big plus.
3. Flooring – I love to see old worn out carpet over hardwood! 8 out of 10 times if you can see hardwood you can refinish it and make it look nice. Pet stains are a big problem sometimes, but a lot of people like the used antiquy (sic) look of older hardwood. Beware that many homes seem to have one bedroom that has something other than hardwood under there, I am not sure why but they do VERY often, so always plan to re-carpet the bedrooms.
4. Windows – The worse the better. Nothing makes a home look and sell better than new clean high efficient windows. Unless they have been replaced in the last few years plan to rip them out and replace them.
5. Heat and Air Units – Look for newer units with good brand names! If they are old they are costly to replace. Remember the new 13 SEER regulation, the old ones soon may not be able to be fixed even if they are not real old.
6. Foundation – Look for cracks and undermining of the soil around the foundation particularly near the down spouts. These are generally bad, and expensive to fix. Small cracks are usually OK, as all concrete will crack, but displaced, shifting, diagonally cracked blocks are usually not good.
7. Layout – Not only the room dimensions but the layout and style. In my opinion ranches are the best bet to start, as they are pretty straight forward and less can go wrong. But often the bathrooms or kitchens are deficient. However this is often easily fixed, but again it costs money so keep that in mind.
8. Lot/parking – Consider the slope of the yard and how useable it is, fencing and privacy are good. Looking around to see what is behind and around the house is also important. Is there sufficient parking?
9. Electrical – Look for an updated service panel in an older home, and check to see if any panel is full, old school fuse boxes are usually not a good idea. This could mean that you have to spend good money to be able to add circuits or could be a dangerous situation. This is best left to a professional licensed professional but a quick look can go a long way initially.
10. Plumbing – This can be especially tricky in vacant homes that may or may not have been winterized. Frozen pipes are usually not discovered until too late. Also pay attention to the tub or shower, one that appears to be in good shape can save a lot of money as it can be saved.
11. Roof – If there is any doubt about the integrity of a roof plan to replace it. The key is to find a nice looking flat roof, with no missing, bent, or damaged shingles. Always look in the attic for signs of leaking and on the ceiling. Leaks are not always bad if you can find the source and repair them easily. Also since you are doing the roof it’s a good idea to have new gutters and downspouts put on too.
Thursday, June 04, 2009
Only in KY - More Good Press! - Louisville of Course
Gun-loving pastor to his flock: Piece be with you
AP – Ken Pagano, pastor of New Bethel Church in Louisville, Kentucky, talks, Wednesday, June 3, 2009, about …
By DYLAN T. LOVAN, Associated Press Writer Dylan T. Lovan, Associated Press Writer – Thu Jun 4, 5:50 pm ET
LOUISVILLE, Ky. – A Kentucky pastor is inviting his flock to bring guns to church to celebrate the Fourth of July and the Second Amendment.
New Bethel Church is welcoming "responsible handgun owners" to wear their firearms inside the church June 27, a Saturday. An ad says there will be a handgun raffle, patriotic music and information on gun safety.
"We're just going to celebrate the upcoming theme of the birth of our nation," said pastor Ken Pagano. "And we're not ashamed to say that there was a strong belief in God and firearms — without that this country wouldn't be here."
The guns must be unloaded and private security will check visitors at the door, Pagano said.
He said recent church shootings, including the killing Sunday of a late-term abortion provider in Kansas, which he condemned, highlight the need to promote safe gun ownership. The New Bethel Church event was planned months before Dr. George Tiller was shot to death in a Wichita church.
Kentucky allows residents to openly carry guns in public with some restrictions. Gun owners carrying concealed weapons must have state-issued permits and can't take them to schools, jails or bars, among other exceptions.
Pagano's Protestant church, which attracts up to 150 people to Sunday services, is a member of the Assemblies of God. The former Marine and handgun instructor said he expected some backlash, but has heard only a "little bit" of criticism of the gun event.
John Phillips, an Arkansas pastor who was shot twice while leading a service at his former church in 1986, said a house of worship is no place for firearms.
"A church is designated as a safe haven, it's a place of worship," said Phillips, who was shot by a church member's relative for an unknown reason and still has a bullet lodged in his spine. "It is unconscionable to me to think that a church would be a place that you would even want to bring a weapon."
Phillips spoke out against a bill before the Arkansas General Assembly that would have permitted the carrying of guns in that state's churches. The bill failed in February.
Pagano, 50, said some members of his church were concerned that President Obama's administration could restrict gun ownership, and they supported the plan for the event when Pagano asked their opinion.
Marian McClure Taylor, executive director of the Kentucky Council of Churches, an umbrella organization for 11 Christian denominations in Kentucky, said Christian churches are promoters of peace, but "most allow for arms to be taken up under certain conditions."
Taylor said Pagano assured her the event would focus on promoting responsible gun ownership and any proceeds would go to charity.
"Those two commitments are consistent with the high value the Assemblies of God churches place on human life," she said in an e-mail message.
Pagano is encouraging church members to bring a canned good and a friend to the event. He said guns must be unloaded for insurance purposes and safety reasons.
He said the point was not to mix worship with guns, though he may reference some passages from the Bible.
"Firearms can be evil and they can be useful," he said. "We're just trying to promote responsible gun ownership and gun safety."
AP – Ken Pagano, pastor of New Bethel Church in Louisville, Kentucky, talks, Wednesday, June 3, 2009, about …
By DYLAN T. LOVAN, Associated Press Writer Dylan T. Lovan, Associated Press Writer – Thu Jun 4, 5:50 pm ET
LOUISVILLE, Ky. – A Kentucky pastor is inviting his flock to bring guns to church to celebrate the Fourth of July and the Second Amendment.
New Bethel Church is welcoming "responsible handgun owners" to wear their firearms inside the church June 27, a Saturday. An ad says there will be a handgun raffle, patriotic music and information on gun safety.
"We're just going to celebrate the upcoming theme of the birth of our nation," said pastor Ken Pagano. "And we're not ashamed to say that there was a strong belief in God and firearms — without that this country wouldn't be here."
The guns must be unloaded and private security will check visitors at the door, Pagano said.
He said recent church shootings, including the killing Sunday of a late-term abortion provider in Kansas, which he condemned, highlight the need to promote safe gun ownership. The New Bethel Church event was planned months before Dr. George Tiller was shot to death in a Wichita church.
Kentucky allows residents to openly carry guns in public with some restrictions. Gun owners carrying concealed weapons must have state-issued permits and can't take them to schools, jails or bars, among other exceptions.
Pagano's Protestant church, which attracts up to 150 people to Sunday services, is a member of the Assemblies of God. The former Marine and handgun instructor said he expected some backlash, but has heard only a "little bit" of criticism of the gun event.
John Phillips, an Arkansas pastor who was shot twice while leading a service at his former church in 1986, said a house of worship is no place for firearms.
"A church is designated as a safe haven, it's a place of worship," said Phillips, who was shot by a church member's relative for an unknown reason and still has a bullet lodged in his spine. "It is unconscionable to me to think that a church would be a place that you would even want to bring a weapon."
Phillips spoke out against a bill before the Arkansas General Assembly that would have permitted the carrying of guns in that state's churches. The bill failed in February.
Pagano, 50, said some members of his church were concerned that President Obama's administration could restrict gun ownership, and they supported the plan for the event when Pagano asked their opinion.
Marian McClure Taylor, executive director of the Kentucky Council of Churches, an umbrella organization for 11 Christian denominations in Kentucky, said Christian churches are promoters of peace, but "most allow for arms to be taken up under certain conditions."
Taylor said Pagano assured her the event would focus on promoting responsible gun ownership and any proceeds would go to charity.
"Those two commitments are consistent with the high value the Assemblies of God churches place on human life," she said in an e-mail message.
Pagano is encouraging church members to bring a canned good and a friend to the event. He said guns must be unloaded for insurance purposes and safety reasons.
He said the point was not to mix worship with guns, though he may reference some passages from the Bible.
"Firearms can be evil and they can be useful," he said. "We're just trying to promote responsible gun ownership and gun safety."
More on CentrePoint Fiasco
If CentrePointe financing fails, Webb has plans B and C, he said
By Beverly Fortune - bfortune@herald-leader.com
Developer Dudley Webb told the Lexington Forum on Thursday he has a Plan B and Plan C for financing for the CentrePointe project and if those plans don't work, he will look for fill dirt to level the site and plant grass.
Also, Webb said he remains optimistic that funding from his unnamed, deceased, financial backer will still come through. He said assets of the international investor's estate are being held in numbered Swiss bank accounts.
Conversations with the man's family indicate they are aware of his commitment of $250 million to finance Webb's luxury hotel and condominium project on West Main Street in downtown Lexington, Webb said.
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Their concern is, on the advice of their attorney, that the funds are there, Webb said.
Recently, Webb and the family reached a compromise that Webb will not look to them to finance CentrePointe if the money isn't the estate.
Webb was notified in late September of the death of the major investor in this project, Webb said. The investor had signed an agreement to provide the funding for the project in June 2008.
Webb and his nephew Woodford Webb are developers for the proposed project. A major portion of the land is owned by businessman Joe Rosenberg and his family.
Webb said he had evidence one year ago that the investor had earmarked $550 million for three projects in the United States, one of which was CentrePointe.
When Webb revealed in April that the investor had died without a will, concern was raised about whether the building would be built. Lexington Vice Mayor Jim Gray said the community had been hoodwinked.
"Believe me, neither the Rosenberg family or we would have gone in and torn down buildings if we didn't think the funding was there for building this project," he said Thursday morning.
Webb also revealed that an original partner in the CentrePointe, John Anderson, backed out of the project a year ago. Anderson had lined up financing with a bank in Atlanta, Webb said. Anderson has developed other project including Marriott hotels, Webb said.
Webb's Plan B includes another unnamed investor, he said. Plan C, he said, involves an unnamed bank "in the states that is interested in getting involved in helping us do this deal."
Earlier in the week, Webb said he had an offer of 20,000 cubic yards of fill dirt that could be used to level the site. If The Webb Companies could get the dirt for free, it would spread it and plant grass, he said. But he said, he "would hate to spend $200,000 to $300,000" to fill the building site hole when in 90 days, construction might begin.
However, he's tempted to take that step, "to shut these people up," he said, referring to the critics of the site.
By Beverly Fortune - bfortune@herald-leader.com
Developer Dudley Webb told the Lexington Forum on Thursday he has a Plan B and Plan C for financing for the CentrePointe project and if those plans don't work, he will look for fill dirt to level the site and plant grass.
Also, Webb said he remains optimistic that funding from his unnamed, deceased, financial backer will still come through. He said assets of the international investor's estate are being held in numbered Swiss bank accounts.
Conversations with the man's family indicate they are aware of his commitment of $250 million to finance Webb's luxury hotel and condominium project on West Main Street in downtown Lexington, Webb said.
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document.write('');
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Their concern is, on the advice of their attorney, that the funds are there, Webb said.
Recently, Webb and the family reached a compromise that Webb will not look to them to finance CentrePointe if the money isn't the estate.
Webb was notified in late September of the death of the major investor in this project, Webb said. The investor had signed an agreement to provide the funding for the project in June 2008.
Webb and his nephew Woodford Webb are developers for the proposed project. A major portion of the land is owned by businessman Joe Rosenberg and his family.
Webb said he had evidence one year ago that the investor had earmarked $550 million for three projects in the United States, one of which was CentrePointe.
When Webb revealed in April that the investor had died without a will, concern was raised about whether the building would be built. Lexington Vice Mayor Jim Gray said the community had been hoodwinked.
"Believe me, neither the Rosenberg family or we would have gone in and torn down buildings if we didn't think the funding was there for building this project," he said Thursday morning.
Webb also revealed that an original partner in the CentrePointe, John Anderson, backed out of the project a year ago. Anderson had lined up financing with a bank in Atlanta, Webb said. Anderson has developed other project including Marriott hotels, Webb said.
Webb's Plan B includes another unnamed investor, he said. Plan C, he said, involves an unnamed bank "in the states that is interested in getting involved in helping us do this deal."
Earlier in the week, Webb said he had an offer of 20,000 cubic yards of fill dirt that could be used to level the site. If The Webb Companies could get the dirt for free, it would spread it and plant grass, he said. But he said, he "would hate to spend $200,000 to $300,000" to fill the building site hole when in 90 days, construction might begin.
However, he's tempted to take that step, "to shut these people up," he said, referring to the critics of the site.
Tuesday, June 02, 2009
Wednesday, May 20, 2009
Day 3: The Missing Link
The Investor in Today’s Market…
Sure it’s daunting out there today. Especially any theory that has a missing link, like this one, is tough to prove. What is the missing link in today's recovery? The real estate investor. The real estate investor is a vital part of any upcoming recovery in the housing and real estate market. Without them, us, I don’t think it will be possible to recover. It’s no shame to admit that you are waiting on the sidelines. It’s hard not to do so when everywhere you look there is someone who knows the market is going to fall another 10% because Jethrow from so-and-so’s office said so last weekend at the yard sale. But sit back and think about it. When is the best time to buy anything? When is the best time to try something new? When is the best time to get into the market? Right; when it’s down, on sale, not working, when there is the right opportunity in front of you it usually is not wearing a big “Hello my name is: The Right Opportunity” sticker. (In my experience anyone with a name tag on is trying to sell you something anyway-think about it.) But if you do see one it’s up to you if you think that is weird or not, but in my opinion it will be a little harder to spot than that, even if it is just as obvious. Most people wouldn’t take any opportunity seriously that rolled in with a name tag on, but sometimes it is just that close and visible to you. It just takes you a little bit of commitment to convince yourself to say Hi and get to know it. What is a real estate investor to do these days? What is the definition of a real estate investor anyway? Who are they? Where are they? What are they looking for? The answers are easy, every person that buys a property is an investor, whether it is for personal use or not. The traditional investors are not out there, at least not in force. Those who are are doing it behind the scenes quietly. But they all have one thing in common; they are looking for a “Deal”. The issue is what defines a deal? Is it a discount off of the listing price? If so who sets a fair listing price? What is the value? Is it a house that is below market value? Again what is Market Value these days? Is it a home that needs repairs? Is it a property with good rental cash flow? Cap Rate? Expense Coverage Ratios? Fully leased property? Wholesale? Refurbished? Good part of Town? Close to Campus? Close to Beach?... Yes to all of these, and no to all of these. The answer is it depends, no one really knows these days. All that can be for certain is that in 10 years anyone who does not take advantage of the possibilities and opportunities out there right now, will be the same ones who ten years ago said gold was too high at $350 an ounce, and that gas will never go over $2.00 a gallon, or below $4.00 a gallon last year, said you can’t go wrong investing in Enron, or had a friend buying JDS Uniphase at $83 a share and would double his money in a week, said Google would never catch on…you know the type. The type that says it is never the right time or that his brother-in-law’s boss who-knows Chuck Norris’ friend who works for Warren Buffett thinks it is a bad idea. That type. So what is the opportunity out there for today’s investor? The opportunity today is choice. Let’s face it good or bad the fact is there are thousands and thousands of properties out there that are empty, distressed, upside down, in foreclosure or soon to be in foreclosure. The banks and lenders are not sure what to d and what not to do. I think they are just waiting for more bailout money. (Apparently the big loan modification rescue plan is not working. The issue is just too big! Just yesterday there was an interview by Matt Lauer on the Today show of all places about how a financial newspaper columnist “quasi-genius” got wrapped up in it and is losing his house. The banks told him repeatedly they were too busy to work with him to fix the mess he was in with his loan I read that one large bank that had billions of dollars of tax bailout money, has modified 1 loan to date. That’s right 1! It wouldn’t matter if they did do it the time it would take to process it would negate half of them anyway. ) They are simply waiting, for what I am not sure, but at some point they will unload thousands of new properties on to the foreclosure market. Checking the local commissioner sale website an average of 40 homes a week are being auctioned off for all of the upcoming sales listed. That is great except 95% of those are being purchased by the plaintiff aka the bank that has the mortgage from them, which adds to their REO inventory, which is precisely the business they do not want to be in, the property management business. All the time these and the others they already have taken back are just sitting, usually empty, or not being cared for if they are occupied. No matter how nice the neighborhood and how well they are watched, an empty house is a deteriorating house, period. Now the banks own properties that if they were to be sold even at a discount cannot be financed by the typical homebuyer as repairs are needed, as they are not in good shape they will not pass the minimum FHA guidelines in most cases. If they do the buyers will usually pass them up for others that need less work and are probably priced the same because the distressed sales are bringing their value down. This does not include the abandoned properties that are not yet in foreclosure or are simply vacant or empty and not distressed. A new plan needs to be tried here, this is not working! Someone, The Investor, will have to step in and be a middle man and have the ability to get these properties at a wholesale type price, repair and refurbish them, then pass them to the end homeowner, or be able to use them as rental property to those that cannot or do not want to buy. The problem is they cannot get the money to do so! What about an incentive for these guys, to make feasible the purchase a responsible amount of investment property, by qualified educated buyers, and give them incentive and or subsidies to make it worth their risk and effort and allow them to have the opportunity to make a profit in the future. This does not mean the “Investor” needs to buy 5, 10 or 20 properties. I am simply stating if you own your own home already; why not look to buy a rental property in your neighborhood, or a duplex somewhere. Small time responsible investing is investing all the same. Do so responsibly, at your comfort level. This would quickly lower inventory, create affordable housing alternatives, and allow homes that otherwise could not be purchased by first time home owners, or low income home owners be available. Want specifics of my plan? Tune in tomorrow…….Day 4 for “The Plan”.
Sure it’s daunting out there today. Especially any theory that has a missing link, like this one, is tough to prove. What is the missing link in today's recovery? The real estate investor. The real estate investor is a vital part of any upcoming recovery in the housing and real estate market. Without them, us, I don’t think it will be possible to recover. It’s no shame to admit that you are waiting on the sidelines. It’s hard not to do so when everywhere you look there is someone who knows the market is going to fall another 10% because Jethrow from so-and-so’s office said so last weekend at the yard sale. But sit back and think about it. When is the best time to buy anything? When is the best time to try something new? When is the best time to get into the market? Right; when it’s down, on sale, not working, when there is the right opportunity in front of you it usually is not wearing a big “Hello my name is: The Right Opportunity” sticker. (In my experience anyone with a name tag on is trying to sell you something anyway-think about it.) But if you do see one it’s up to you if you think that is weird or not, but in my opinion it will be a little harder to spot than that, even if it is just as obvious. Most people wouldn’t take any opportunity seriously that rolled in with a name tag on, but sometimes it is just that close and visible to you. It just takes you a little bit of commitment to convince yourself to say Hi and get to know it. What is a real estate investor to do these days? What is the definition of a real estate investor anyway? Who are they? Where are they? What are they looking for? The answers are easy, every person that buys a property is an investor, whether it is for personal use or not. The traditional investors are not out there, at least not in force. Those who are are doing it behind the scenes quietly. But they all have one thing in common; they are looking for a “Deal”. The issue is what defines a deal? Is it a discount off of the listing price? If so who sets a fair listing price? What is the value? Is it a house that is below market value? Again what is Market Value these days? Is it a home that needs repairs? Is it a property with good rental cash flow? Cap Rate? Expense Coverage Ratios? Fully leased property? Wholesale? Refurbished? Good part of Town? Close to Campus? Close to Beach?... Yes to all of these, and no to all of these. The answer is it depends, no one really knows these days. All that can be for certain is that in 10 years anyone who does not take advantage of the possibilities and opportunities out there right now, will be the same ones who ten years ago said gold was too high at $350 an ounce, and that gas will never go over $2.00 a gallon, or below $4.00 a gallon last year, said you can’t go wrong investing in Enron, or had a friend buying JDS Uniphase at $83 a share and would double his money in a week, said Google would never catch on…you know the type. The type that says it is never the right time or that his brother-in-law’s boss who-knows Chuck Norris’ friend who works for Warren Buffett thinks it is a bad idea. That type. So what is the opportunity out there for today’s investor? The opportunity today is choice. Let’s face it good or bad the fact is there are thousands and thousands of properties out there that are empty, distressed, upside down, in foreclosure or soon to be in foreclosure. The banks and lenders are not sure what to d and what not to do. I think they are just waiting for more bailout money. (Apparently the big loan modification rescue plan is not working. The issue is just too big! Just yesterday there was an interview by Matt Lauer on the Today show of all places about how a financial newspaper columnist “quasi-genius” got wrapped up in it and is losing his house. The banks told him repeatedly they were too busy to work with him to fix the mess he was in with his loan I read that one large bank that had billions of dollars of tax bailout money, has modified 1 loan to date. That’s right 1! It wouldn’t matter if they did do it the time it would take to process it would negate half of them anyway. ) They are simply waiting, for what I am not sure, but at some point they will unload thousands of new properties on to the foreclosure market. Checking the local commissioner sale website an average of 40 homes a week are being auctioned off for all of the upcoming sales listed. That is great except 95% of those are being purchased by the plaintiff aka the bank that has the mortgage from them, which adds to their REO inventory, which is precisely the business they do not want to be in, the property management business. All the time these and the others they already have taken back are just sitting, usually empty, or not being cared for if they are occupied. No matter how nice the neighborhood and how well they are watched, an empty house is a deteriorating house, period. Now the banks own properties that if they were to be sold even at a discount cannot be financed by the typical homebuyer as repairs are needed, as they are not in good shape they will not pass the minimum FHA guidelines in most cases. If they do the buyers will usually pass them up for others that need less work and are probably priced the same because the distressed sales are bringing their value down. This does not include the abandoned properties that are not yet in foreclosure or are simply vacant or empty and not distressed. A new plan needs to be tried here, this is not working! Someone, The Investor, will have to step in and be a middle man and have the ability to get these properties at a wholesale type price, repair and refurbish them, then pass them to the end homeowner, or be able to use them as rental property to those that cannot or do not want to buy. The problem is they cannot get the money to do so! What about an incentive for these guys, to make feasible the purchase a responsible amount of investment property, by qualified educated buyers, and give them incentive and or subsidies to make it worth their risk and effort and allow them to have the opportunity to make a profit in the future. This does not mean the “Investor” needs to buy 5, 10 or 20 properties. I am simply stating if you own your own home already; why not look to buy a rental property in your neighborhood, or a duplex somewhere. Small time responsible investing is investing all the same. Do so responsibly, at your comfort level. This would quickly lower inventory, create affordable housing alternatives, and allow homes that otherwise could not be purchased by first time home owners, or low income home owners be available. Want specifics of my plan? Tune in tomorrow…….Day 4 for “The Plan”.
Tuesday, May 19, 2009
Day Two - What is Driving Today's Market?
What is driving today’s market?
The short answer is nothing really. It’s like an empty car in neutral rolling down a hill. Yes it will roll, and it will go until it either runs off the road or hits something big enough to stop it. Why? How? Gravity. No not a tractor beam (Borrowed Stimulus Money) sent from the mother ship (Gov’t) pulling it downhill, its gravity it has always been here.
Compare that visual to today’s burgeoning recovery (the car) which is starting to roll in many areas of the country the movement can be attributed to a few things.
1. The natural cycle (The gravity) for this time of year, the spring and summer naturally bring more activity, a good amount of stored up demand. (Which is in my opinion mostly due to the unfavorable, inaccurate, over generalized media coverage of the last year.)
2. Attractive first time home buyer incentives i.e. $8,000 tax credit, record levels of inventory, lower prices and increased affordability. The big if is the supposed increasing availability of mortgage financing available. (The road with a big 90 degree turn coming up)
While these are all nice, and depending on which party’s media machine you listen to, there are signs of optimism in the economy and overall direction of the housing market. There are signs of a bottoming out of the housing fall, an increased level of activity and consumer confidence in housing all over the place.
But for a true long term recovery there are a few items missing and a few time bombs (The Wall) lurking in the near future that could derail any recovery unless they are addressed; one of the most immediate being the $8,000 first time buyer tax incentive sunset of December 2009, not that this can continue indefinitely however. At some point virtually every person with the ability to purchase a home as a first time buyer is going to do so. Sure there will always be new people entering the market, but the level to drive a recovery will, has, level off and the effect will be less noticeable, they cannot drive the market for ever. Also the job market and banks starting to lend again are big deals, but those are obvious and yesterday’s news.
So what do I think is needed next? (Who can jump in our empty rolling car and steer us around that corner and away from that wall?) I think a new incentive should be introduced to spur the missing link in the housing recovery, the real estate investor. Not the jacked-up-on-HGTV flipping-manic-fly-by-night-know-it-all-jack-of-all-trades-price-war-bidding over exuberant type of the early to mid 00’s. But the professionals, and the rational small time investor looking to take advantage of an opportunity, and to make sound quality purchases of an asset that can never be worthless.* (As I have stated many times before, if you find a piece of property that is truly worth $0, tell me and I will buy it! Chernobyl excluded).
Tomorrow Day 3…The Investor the Missing Link
The short answer is nothing really. It’s like an empty car in neutral rolling down a hill. Yes it will roll, and it will go until it either runs off the road or hits something big enough to stop it. Why? How? Gravity. No not a tractor beam (Borrowed Stimulus Money) sent from the mother ship (Gov’t) pulling it downhill, its gravity it has always been here.
Compare that visual to today’s burgeoning recovery (the car) which is starting to roll in many areas of the country the movement can be attributed to a few things.
1. The natural cycle (The gravity) for this time of year, the spring and summer naturally bring more activity, a good amount of stored up demand. (Which is in my opinion mostly due to the unfavorable, inaccurate, over generalized media coverage of the last year.)
2. Attractive first time home buyer incentives i.e. $8,000 tax credit, record levels of inventory, lower prices and increased affordability. The big if is the supposed increasing availability of mortgage financing available. (The road with a big 90 degree turn coming up)
While these are all nice, and depending on which party’s media machine you listen to, there are signs of optimism in the economy and overall direction of the housing market. There are signs of a bottoming out of the housing fall, an increased level of activity and consumer confidence in housing all over the place.
But for a true long term recovery there are a few items missing and a few time bombs (The Wall) lurking in the near future that could derail any recovery unless they are addressed; one of the most immediate being the $8,000 first time buyer tax incentive sunset of December 2009, not that this can continue indefinitely however. At some point virtually every person with the ability to purchase a home as a first time buyer is going to do so. Sure there will always be new people entering the market, but the level to drive a recovery will, has, level off and the effect will be less noticeable, they cannot drive the market for ever. Also the job market and banks starting to lend again are big deals, but those are obvious and yesterday’s news.
So what do I think is needed next? (Who can jump in our empty rolling car and steer us around that corner and away from that wall?) I think a new incentive should be introduced to spur the missing link in the housing recovery, the real estate investor. Not the jacked-up-on-HGTV flipping-manic-fly-by-night-know-it-all-jack-of-all-trades-price-war-bidding over exuberant type of the early to mid 00’s. But the professionals, and the rational small time investor looking to take advantage of an opportunity, and to make sound quality purchases of an asset that can never be worthless.* (As I have stated many times before, if you find a piece of property that is truly worth $0, tell me and I will buy it! Chernobyl excluded).
Tomorrow Day 3…The Investor the Missing Link
Monday, May 18, 2009
Todays Market - Tomorrows Market Part 1
I doubt there is anyone out there than can dispute that the home buying and selling process, whether new or existing, is a vital and important aspect of any economy. The velocity of money which accompanies each transaction is enormous. With so many different beneficiaries from builders, suppliers, real estate agents, insurance agents and companies, bankers, investors, lenders, inspectors, repairmen, roofers, local, state, federal tax coffers, attorneys,, ….the list can go on for a long time I think you get the point. Each property sale creates enormous income for many, people, who in turn take that money and spend it elsewhere, who take that and spend it, who take that….
I think it is time we take a step back and look at the reality of today’s market, to see what is really going on, and where it’s going tomorrow. What are the few key issues that are driving today’s market? Also what are the few missing pieces that are needed to bring the market back to a true recovery, or a true long term positive, sustainable healthy level?
That is what I am going to explore the next few days, and present my plan and my ideas. I would like your ideas too, so chime in as you please and I will use your input in the plan, good or bad. I will then present the final plan anyone that will listen, to see if anything happens....at worst we can look back and say we tried!
Tomorrow…What is driving today’s market?
I think it is time we take a step back and look at the reality of today’s market, to see what is really going on, and where it’s going tomorrow. What are the few key issues that are driving today’s market? Also what are the few missing pieces that are needed to bring the market back to a true recovery, or a true long term positive, sustainable healthy level?
That is what I am going to explore the next few days, and present my plan and my ideas. I would like your ideas too, so chime in as you please and I will use your input in the plan, good or bad. I will then present the final plan anyone that will listen, to see if anything happens....at worst we can look back and say we tried!
Tomorrow…What is driving today’s market?
Thursday, May 14, 2009
New Real Estate Degree
Thinking of creating a degree of Certified Real Life Real Estate Professional a combination of business, finance, engineering, marketing, law, B.S., psychlogy, early childhood education, enviromental services, insurance, mental health, and construction. I think I will approach the local colleges and universities to begin offering an advanced degree in Real Life Real Estate. Afterall it is expected that we know all of this stuff somehow anyway, why not be professional have a degree that covers it all. I envision a 3 year crash course to give a masters level degree in all of these in one blanket degree in real estate.
Wednesday, May 13, 2009
Advertising
I am going to make it official, NO MORE TRADITIONAL OR PAPER ADVERTISING. Ran some numbers recently, and the return on investment for all of the paper advertising I could track was .08%. Pretty Good huh? Yes I know there are untrackable possibilities, branding, name recognition and such issues. But if the numbers were even close to average say 8-12% that would be one thing, but less than 1%! I went back to every property I had ever sold, or listed and not sold for some reason. Every buyer client I had, and traced back as many as possible as to where and what made them contact me about buying or selling their home. I could do that for 145 transactions out of all the transactions I have done, not including personal. Guess how many came from Print, TV, or Mailers....2. Out of the rest an overwhelming majority came from Sphere of Influence and referrals 97. Online was 39, and open houses, random or other person to person were the other 8. Yes I know that is 1 too many, but one was in two categories. They came drive by my house and I was there, they saw the add in a real estate book, but did not call me....right place right time. I am going to try to figure out what the remaining transactions came from but it would take a lot to make any difference in my new plan. NO MORE PRINT OR TRADITIONAL ADVERTISING! Online all the way.....except for my postcards and newsletters of course. We will see how it goes!
Thursday, April 02, 2009
First Time Buyers Information
Here is the National Association of Realtor's webpage with information on the first time buyers credit. Good site, and a video for those of you like me who can't concentrate.
Link to First Time Buyers Information
Link to First Time Buyers Information
Wednesday, April 01, 2009
I am back
I found this BLOG I started a long time ago, so I am back. From here on it will be updated daily...
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