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Why 2011 May Be the End of the Housing Crash

2011-03-03T10:09:00.001-08:00

Simon Constable explains to Kelsey Hubbard how rising affordability of housing will be a key to a turnaround. Plus how to invest in housing without buying a home.
.There might finally be some good news this year about the nation's dismal housing market. Or, at least, the bad news could stop.

Either way, it will be welcome relief for current homeowners as well as for potential real-estate investors. Reasons to be optimistic have been sadly lacking since the housing bubble burst in 2006.

For sure, last week we learned the widely watched S&P/Case-Shiller home-price index fell 1% in December, its fifth straight decline. The index tracks 20 major markets.

Andrew Roberts
.But that figure belies real reasons to be optimistic, according to some experts. If they are right, it might make sense to jump into real estate. The trick is avoiding getting burned again, and it doesn't necessarily mean owning a home.

First, let's recap the economic signs a bottom is close.

Houses Are a Good Deal
Housing is the most affordable it has been in decades, according to analysts at Moody's Analytics. They don't just look at house prices. They also look at incomes.

Nationally, the cost of a house is the equivalent of about 19 months of total pay for an average family, the lowest level in 35 years. Prices usually average close to two years' pay, although that varies nationally.

At the peak, midway through the last decade, a home in Los Angeles cost the equivalent of 4.5 years' pay. The average price has since fallen to just over two years' income now. That's well below its pre-bubble average of 2.6 years. This means average Los Angeles homes are cheaper in "real terms" than they were typically during the period 1989 through 2003.

The opposite is true around the Washington beltway, where it will take 26 months of pay to buy a home, versus the historical norm of 22 months.

In the end, it will be affordability that will drive people to buy homes.

"Pricing is down so much in some markets that when you analyze renting versus owning it makes much more sense to own," says Michael Larson, a real-estate analyst at Weiss Research in Jupiter, Fla.

It is definitely bullish. But what about timing?

"Housing prices will probably bottom in 2011," says Scott Simon, a managing director at money-management firm Pimco in Newport Beach, Calif. He foresaw the housing crash, helping his firm dodge losses that plagued Wall Street.

.Mr. Simon says prices might dip another 5%. Still, in the scheme of things, that's small. Consider this: In some markets, home prices have fallen by half or more since 2006.

For instance, in once-hot Miami you can snap up an average house for under $166,000, according to recent data from the National Association of Realtors. That's down from $371,000 in 2006. Another 5% drop would take it to $158,000.

Investors Stepping Up
Here's another sign the market is nearing a bottom: Investors have started to buy up houses and condos, in some instances paying entirely in cash. That's a far cry from the heady bubble days when borrowed money seemed the key to riches. The bubble-era speculators who got burned tended to buy at the peak and borrowed heavily to do so. When the crash came, they quickly saw their wealth erased.

Take Miami again. Last year, more than half of all transactions were made entirely in cash, according to a recent report in The Wall Street Journal. That compares with 13% of deals in the last quarter of 2006, the height of the bubble. Similarly, in Phoenix 42% of sales in 2010 went to all-cash buyers, up threefold since 2008.

It's a sign that these investors are betting on a rebound. Investors buying at current prices are looking for deals, or so-called bottom fishing. They typically like to pay entirely in cash (or with a relatively small loan) to speed up transactions. That can be vital for an investor wishing to lock in a deal fast.

If this is a turn in the market, then it might make sense to go out and buy a home. But, warns Pimco's Mr. Simon, "buy in areas you really know."

Plan to Stay Put
Buy and hold. While the good news is that the worst of the housing crash might be over, the bad news is that the fast gains of the glory days of 2005 and 2006 won't be back any time soon. So to cover the costs of buying and selling, and what could be a prolonged recovery, plan to own for more than 10 years, explains Jack Ablin, chief investment officer at Chicago-based Harris Bank.

Also remember that borrowing money to buy a house can still be risky. If you pay for a $100,000 property with $20,000 cash and borrow the rest, a dip in the value of $20,000 would leave you with zero equity. On top of that, you'd have to pay to maintain and repair the property, something not necessary when renting.

Home Buying Without a House
There are other ways to benefit from a real-estate rebound than directly buying a house. Such investments include stocks, mutual funds or exchange-traded funds. Unlike homes, which typically cost tens of thousands of dollars, these financial investments can be made in smaller amounts and typically are easy to sell.

Weiss Research's Mr. Larson says although new homes are oversupplied, home builders might benefit from a rebound as the situation rights itself.

Rather than pick individual stocks, he says, it probably makes sense for small investors to pick broader investments that hold many different stocks. In particular, he points to the SPDR S&P Homebuilders ETF (XHB), which tracks a basket of home-builder stocks.

Mr. Larson also highlights specialized mutual funds such as the Fidelity Select Construction & Housing fund (FSHOX), which tracks home builders as well as home-improvement retailers like Home Depot and Lowes that would also likely benefit from a housing recovery.

Stand-Alone Home Prices Move Above $500,000 Mark

2010-10-28T09:58:00.000-07:00

By Mark Mueller

Friday, October 22, 2010

The median price of an existing Orange County home moved back above the $500,000 mark in September, while the pace of sales here remained sluggish, the California Association of Realtors said Friday.

The median price for an existing stand-alone OC home sold in September was $510,530, a nearly $11,000 or 2.2% increase from August, and a 2.8% increase from the prices homes here were selling at a year earlier.

The area’s median sales price now is up about 21% from the recent bottom of the market, seen in January 2009, according to the association’s figures.

Prices here are still off more than 31% from the peak of the market, when the median sales price for an OC home topped $747,000 in April 2007.

The number of OC home sales in September was up 1.6% from a month earlier, the Realtor association said.

Sales were down 10.4% from a year earlier.

The median sales price of an existing home in California was $309,900 in September, a 2.7% decrease from August and a 4.5% increase from a year ago, according to the association.

Sales in California were up about 3.8% from August’s levels, but were off nearly 12% from a year earlier. The inventory of homes priced under $500,000 remains “lean,” according to the association.

The association excludes condominiums from its figures.

Including condos, the median price of an OC home sold in September was $445,000, a jump of more than $16,000 or 3.7% from a year earlier, according to a report earlier this week from San Diego-based MDA DataQuick, a unit of Canada’s MacDonald, Dettwiler and Associates.

A Little-Known Loan Program for Fixer-Uppers

2010-10-22T10:18:00.000-07:00

BUYERS of distressed homes or any other fixer-upper not only face the daunting task of turning a run-down property into a livable one, but often worry about paying for it all.

There’s a way to make essential repairs and add other accouterments without dipping into savings or taking out a home-equity loan. The Federal Housing Administration’s 203(k) rehabilitation program provides for loans covering renovation costs as well as the purchase price of a primary residence — investors excluded — and it allows for just a 3.5 percent down payment.

“It’s a fantastic program, one that hasn’t been fully utilized by the American public,” said Arthur Hood, the owner of the Vanguard Inspection Group in Teaneck, N.J., which is certified by the Department of Housing and Urban Development to help borrowers with the program.

Although the program has been around since 1978, it is not well publicized, and many borrowers mistakenly think they have to buy a wreck in order to qualify. They don’t.

The house “doesn’t have to be falling apart; it could just be outdated,” said Joseph Latini Sr., the president of Hartford Funding, a lender in Ronkonkoma, N.Y. “It just has to appraise below market value and then at market value with the repairs.”

While “run-down” typically means a foreclosure, the program also applies to many historic and older houses as well as short sales and bank-owned homes. HUD outlines the rules on its Web site.

Luxury improvements are ineligible, though the program has wide definitions of “repairs” and “modernization.” Covered repairs include a new roof or heating system (geothermal ones too). Decorative changes, like replacing vinyl with ceramic tile on the kitchen floor replacement, or painting the interior, are covered.

The loan rates typically run around a percentage point higher than conventional ones, and come in 15- to 30-year terms, either fixed or adjustable. Additional paperwork for inspection, appraisal, title updating and the like pushes closing costs $1,000 or more higher than average. Most borrowers, however, refinance to a conventional loan after a few years, Mr. Hood said.

Demand for 203(k) financing has been on the rise, although experts predict some contraction given the major banks’ current moratorium on foreclosures. For the first nine months, HUD insured $2.9 billion in 203(k) loans, compared with $3 billion for all of 2009 and $401 million in 2005.

Home buyers must put down at least 3.5 percent of the current value of the property and use a HUD-approved lender, appraiser and a contractor approved by the lender for the repairs. One list of approved businesses can be found at 203kcontractors.com.

Using a HUD-approved consultant like Mr. Hood, who charges a flat fee of $400 to $1,000, is not required, but the agency recommends it to expedite processing. A HUD-approved inspector will make around four trips to the home to ensure that renovations are being properly done; each trip costs the borrower around $150.

Most 203(k) lenders are smaller regional and community banks. Loan limits vary by geography, and range from $271,050 to $729,750, which covers the total mortgage. The first $5,000 must go toward the more substantial repairs like roof replacement. HUD insures the loan.

Once the borrower receives the mortgage, money owed the contractor for repairs is held in escrow by the lender until the work is completed; all work must be finished within six months.

A miniversion of the 203(k) — called a Streamline (k) — has a repair-cost limit of $35,000 and restricts upgrades to minor improvements like replacing gutters. In this case, the do-it-yourself approach is permitted.

“This is a loan for someone who’s willing to be a little involved,” said Jon Sigler, a banker in Madison, Conn., who works for at the Franklin American Mortgage Company.

California median price rebounds 30% | Inman News

2010-09-23T10:02:00.000-07:00

California median price rebounds 30% | Inman News

2010-09-10T10:55:00.001-07:00

Foreclosure Counselors: What They Can and Can't Do

Foreclosure counselors can make the difference between losing your home and keeping it. Here’s how they work and how to choose one. Read
Website Resources for Foreclosure Help

Here are some legitimate resources to help you fight the foreclosure crisis. Read
Foreclosure Help: 5 Pros You Need on Your Team

Know which experts provide foreclosure help—often at no cost to you—and how to find them. Read
Facing Foreclosure: What to Do Right Now

If you’re facing foreclosure, don’t panic: Take steps right now to save your home or at least lessen the blow of its loss. Read
Avoid Foreclosure Rescue Scams

With foreclosure rescue scams widespread as more homeowners fall behind on mortgage payments, be smart if you seek help. Read

Visit houselogic.com for more articles like this.

http://www.realtor.org/RMODaily.nsf/pages/News2010090702?OpenDocument

2010-09-10T10:51:00.000-07:00

http://www.realtor.org/RMODaily.nsf/pages/News2010090702?OpenDocument

California, FHA offer 4% loans | Inman News

2010-09-08T13:29:00.000-07:00

California, FHA offer 4% loans | Inman News

http://www.realtor.org/RMODaily.nsf/pages/News2010090302?OpenDocument

2010-09-03T12:00:00.000-07:00

http://www.realtor.org/RMODaily.nsf/pages/News2010090302?OpenDocument

High interest rates got you burning like a bratwurst at a Labor Day Barbeque?

2010-09-01T11:51:00.000-07:00

High interest rates got you burning like a bratwurst at a Labor Day Barbeque? Time to cool down and refresh yourself with the LOWEST interest rates in 60 YEARS!

Interest rates have dropped over the past few weeks. Call today to see how I can help you save on your monthly budget by lowering your monthly payments, take cash out for home improvements or other needs, or shorten the term of your loan. Even if you have refinanced or completed your purchase loan with me recently, I may be able to help so call to discuss your specific needs and scenario. Don't miss this once in a lifetime opportunity.

I will be in the office all day today and can secure interest rate locks until 3:00PM.

Thank you for your continued business, support and referrals!

http://www.realtor.org/rmodaily.nsf/pages/News2010082401?OpenDocument

2010-08-27T14:38:00.000-07:00

http://www.realtor.org/rmodaily.nsf/pages/News2010082401?OpenDocument

FHA premium changes pushed to Oct. 4 | Inman News

2010-08-27T14:37:00.000-07:00

FHA premium changes pushed to Oct. 4 | Inman News

Calif.’s first-time buyer tax credit almost gone | time, eight, almost - Business - The Orange County Register

2010-06-23T14:59:00.000-07:00

Calif.’s first-time buyer tax credit almost gone | time, eight, almost - Business - The Orange County Register

2010-06-18T14:19:00.000-07:00

Mortgage Rates Drop to Lowest Level of the Year

2010-05-28T12:15:00.000-07:00

Mortgage interest rates have fallen to their lowest level of the year. Economists say homebuyers have the financial turmoil in Europe to thank for that, as overseas investors have put their dollars instead towards what they see as safer U.S. securities.

The mortgage industry has been bracing for a rise in interest rates now that the Federal Reserve has ceased buying mortgage-backed securities. But with international money being poured into U.S. Treasury bonds, which are closely tied to rates for home loans, that rise has yet to come about – a definite plus for the residential real estate market here in the states as it confronts an expected drop in sales activity now that the homebuyer tax credit has expired.

According to Freddie Mac’s rate report released Thursday, interest rates on 30-year fixed-rate mortgages (FRM) averaged 4.78 percent (0.7 point) this week, down from last week when the average rate was 4.84 percent. According to the GSE’s study, the 30-year FRM has not been lower since the week ending December 3, 2009, when it averaged 4.71 percent.
The 15-year FRM this week averaged 4.21 percent (0.7 point), Freddie Mac reported. That’s a slight drop from last week when it was 4.24 percent. Freddie says the 15-year FRM has not been lower since it started tracking 15-year rates in August of 1991.

“These low rates will help to elevate homebuyer affordability and soften the effects of the sunset of the homebuyer tax credit,” said Frank Nothaft, Freddie Mac’s VP and chief economist. “The latest information from Freddie Mac’s repeat-transactions home-price indexes also show some encouraging signs, with national metrics either slowing their descent or showing a modest rise, suggesting that the sharp downturn in national indexes since 2006 may be nearing an end.”

A separate study from Bankrate Thursday also puts mortgage rates at 2010 lows. Bankrate’s survey is based on data provided by the top 10 banks and thrifts in the top 10 markets.

Thirty-year fixed mortgage rates dropped to 4.92 percent (0.42 point) – a record low in Bankrate’s weekly survey. Last week, the 30-year rate came in at 4.96 percent.

The average 15-year fixed mortgage was unchanged from last week in Bankrate’s study at 4.34 percent, as was the larger jumbo 30-year fixed rate at 5.75 percent.

“The angst of investors around the globe about European debt, slower growth in China, and saber-rattling on the Korean Peninsula all feed into what is known as the ‘fear trade,’” Bankrate said in its report. “That fear trade has helped bring yields on U.S. Treasury securities considerably lower and mortgage shoppers have been direct beneficiaries.”

The housing recovery is just around the corner

2010-05-24T10:47:00.001-07:00

The housing recovery is just around the corner – at least that’s the consensus among a panel of 92 well-known industry economists and analysts.

The Madison, New Jersey-based analytics firm MacroMarkets LLC, founded by Robert Shiller, real estate sage and father of the closely-watched Case-Shiller Home Price Index, polled the group of housing market experts and strategists from the likes of Alliance Bernstein, Columbia Business School, Deutsche Bank, Moody’s Analytics, and the GSEs.

Based on their responses, the onset of price recovery in U.S. single family real estate is widely expected by 2011.

Between 2010 and 2014, the panelists forecast a rise in home prices of more than 12 percent.

“The survey results are important because they represent a consensus view among experts with rich and diverse knowledge,” Shiller said. “In the May survey they see only the slightest hint of a downdraft in home prices this year, and after that a respectable uptrend in prices, well ahead of the likely inflation rate.”
But Shiller added, “However, there were a number of panelists more or less sanguine than average, some significantly so, and this reflects continuing volatility and risk in the U.S. housing market.”

The views of those questioned by MacroMarkets didn’t all align. Joe LaVorgna, the chief economist at Deutsche Bank, pegs home prices to rise 37 percent over the next four years.

At the low end of the scale, both Gary Shilling, president of A. Gary Shilling & Co., and Anthony Sanders, professor of real estate finance at George Mason University, expect prices to have fallen by 18 percent by the end of 2014.

“The expectations within this first survey were provided following the end of the homebuyer tax credit and of the Federal Reserve’s $1.25 trillion mortgage-backed securities purchase program,” Shiller said. “It will be interesting to see how panelist views evolve in future months.”

According to the Federal Reserve, the aggregate value of real estate owned by households at the end of 2009 was $16.6 trillion.

Terry Loebs, MacroMarkets managing director and co-developer of the survey, put that figure into perspective when he said, “This asset class is still larger than U.S.-listed stocks in aggregate market capitalization terms.”

Loebs said, “The scale of the U.S. housing market, coupled with the powerful wealth effects of prevailing home equity levels, warrant close attention to future home prices. For example, if the cumulative 12.4 percent improvement in aggregate national home value follows the path that this panel’s year-by-year averages are suggesting, consumer balance sheets will improve by $2.1 trillion in less than five years.”

Real estate bottom reached in some California markets? | Inman News

2010-05-11T13:55:00.001-07:00

Real estate bottom reached in some California markets? | Inman News

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How foreclosure impacts your credit score

2010-04-30T10:29:00.000-07:00

NEW YORK (CNNMoney.com) -- If you're delinquent on your mortgage, your credit score will suffer. Everyone knows that. The question is, by how much?

Until recently, those answers were hard to come by. Credit bureaus were uncommunicative about expressing, in points, just how much impact different foreclosure types of mortgage delinquencies have on scores.
Recently, Fair Isaac, which developed FICO scores, pulled back the curtain a bit, revealing some estimates of point-score declines following mortgage delinquency problems.

Here are the average hit your credit will take:

30 days late: 40 - 110 points

90 days late: 70 - 135 points

Foreclosure, short sale or deed-in-lieu: 85 - 160

Bankruptcy: 130 - 240

To come to these figures, Fair Isaac created two hypothetical consumers, one who starts out with a fair-to-middling score of 680 and the other with a very good one of 780. (FICO scores range from 300 to 850.)

The hypothetical person with the 780 FICO has 10 credit accounts versus six for the 580, plus a longer credit history, lower utilization of total credit limit and no missed payments on any account. The other consumer has two slightly damaged accounts. Neither have any accounts in collection or adverse public records.

See the chart above to see how each scenario affected each borrower.

Notice that for both borrowers a single one-time black mark results in steep drops, but it is when they fall further behind that things get really harsh, according to Craig Watts, a spokesman for Fair Isaac.

"The lending industry tends to regard an account differently when it has become 90 or more days late," he said, "The likelihood that consumers will resume paying their overdue obligations drops off significantly after the delinquencies have reached 90 days."

One reason credit companies were so closed-mouthed is that they often can't definitively state how much each delinquencies will affect scores because there are too many variables.

Some borrowers will fall much more steeply than others for the same payment problem, according to Maxine Sweet, vice president for public education at Experian, one of the nation's main credit bureaus.

"If you picture someone who has just one mortgage and one other credit account versus a mature credit user like me with 15 accounts, if they miss one payment that would impact their scores a lot more," she said. "For me, one missed payment would just be a blip."

The point loss also depends on the borrower's starting point: People with very high credit scores have more to lose than low-score borrowers; the impact of a single blemish on an 800 score is more than on a 500
Of course, it just gets worse when you face foreclosure.

Mortgage borrowers can lose their homes three basic ways: a foreclosure; a short sale, where the home is sold for less than than is owed and the bank (generally) forgives the difference; or a deed-in-lieu, in which the borrower gives back the property and the bank again forgives any unpaid balance.

Sweet said credit bureaus generally slash scores equally for those three resolutions to someone losing their home. The important factor, she said, is that "it's reported that you paid less on a settled account."

Some borrowers may think that because they never missed a payment, they can "walk away" from their homes with relatively little impact on scores. Not true. "When a deed-in-lieu or short sale is reported as a partial payment, it's treated as a serious delinquency," Watts said, "just like a foreclosure."

Even if borrowers made payments faithfully for years before short selling or doing a deed-in-lieu, their credit score will still take a hit. The total decline will run about 85 points for the 680 score borrower to as much as 160 for the 780 score.

Mortgage debt, combined with other financial problems, can send borrowers into bankruptcy, the worst thing that can happen to your credit score.

The effects are long-lasting, according to Sweet. In a Chapter 13 bankruptcy, which involves partial repayment over several years, the stain will take seven years to remove. A Chapter 7 bankruptcy, which involves liquidation, takes 10 years to get over.

It's gonna cost you
Absorbing a big credit-score hit can make many transactions more costly. It's not just paying more for credit card debt and auto loans, insurance can cost more as well.

The average savings for someone with a good versus mediocre credit score is about $115 a year for auto insurance and $60 for home, according to Loretta Sorters, of the Insurance Information Institute.

A low credit score can even make it harder to rent a home because landlords often use credit scores to weed out prospective renters.

Despite the problems a poor credit score can cause, Experian's Sweet recommends that people who are in financial dead ends, like totally unaffordable mortgages, it's better to recognize that and cut your losses quickly; don't prolong the problem.

"You need to do what you need to do to get your finances back in order," she said. "Don't worry about your credit score."

Home sales rise more than expected

2010-04-22T15:19:00.001-07:00

WASHINGTON (AP) -- Home sales rose more than expected in March, reversing three months of declines, as government incentives drew in buyers and kicked off what's expected to be a strong spring selling season.

Sales of previously occupied homes rose 6.8 percent to a seasonally adjusted annual rate of 5.35 million last month, the highest level since December, the National Association of Realtors said Thursday. February's sales figures were revised downward slightly to 5.01 million.

"The spring selling season will be a success and probably the most active we're seen in years," said Stuart Hoffman, chief economist at PNC Financial Services Group.

Sales are likely to keep growing through the first half of the year as tax credits for first-time buyers and low mortgage rates fuel purchases. The average interest rate this week was 5.07 percent for a traditional 30-year fixed-rate mortgage, Freddie Mac said Thursday.

But doubts remain about whether the momentum will be sustained in the second half of the year when federal support is gone.

"This is a temporary surge that won't be sustained" said Paul Dales, US economist with Capital Economics. "It won't be very pretty."

Sales are now up 18 percent from their low in early 2009, but are still down 26 percent from their peak in fall 2005. March's results had been expected to rise about 5 percent to 5.28 million, according to economists surveyed by Thomson Reuters.

The results show the housing market is stabilizing after a devastating bust. But the true test will be whether the market can stand on its own after federal tax credits expire at the end of this month.

Sales rose in every region, surging more than 7 percent in the Midwest and South, 6.6 percent in the West and 6 percent in the Northeast.

"It's a very broad-based recovery," said Lawrence Yun, the Realtors' chief economist.

The median sales price was $170,700, up almost 4 percent from $164,600 a month earlier and nearly unchanged from $170,000 in March 2009.

The inventory of unsold homes on the market was up 1.5 percent at 3.6 million. That's an eight month supply at the current sales pace.

Sales nationally had declined over the winter, eroding gains made last fall and summer. The downward direction troubled economists because the government has taken unprecedented steps to support the housing sector.

For several months, home shoppers didn't feel rushed after lawmakers extended the deadline to qualify for tax incentives. The government is offering a $8,000 credit for first-time buyers and $6,500 for current homeowners willing to buy and move into another property.

But now time is running out. Buyers must sign contract offers by April 30 to qualify, and real estate agents say that's spurring sales.

"Many people who otherwise wouldn't be on the market for a home want to take advantage of these tax credits," said Kathi McLeod, sales manager for Windermere Real Estate in Boise, Idaho. "You have buyers who have been looking and looking at properties and realizing that it's almost too late, so they're really scrambling and jumping into deals."

The Realtors group is not pushing for an another extension of the tax credit. Yun said he believes there will be enough demand in the second half of the year without a government subsidy.

Still, some housing market experts predict the market will take a dramatic "double-dip" once the government's supports are gone. But others argue that there is enough pent-up demand to keep the market chugging. And prices have fallen dramatically since the boom years -- as much as 50 percent in some places. So buyers can pick up bargain-priced foreclosures.

AP Business Writer Erin Conroy in New York contributed to this report.

Low Rates Likely Through 2010

2010-04-09T11:56:00.001-07:00

Interest rates are likely to remain low into 2011, Federal Reserve policymakers hinted this week in at least two presentations. These indications came one week after the Fed shut down its program to buy mortgage-backed securities, which had kept rates at or near record lows in recent months.

In a speech Thursday, Fed Governor Daniel Tarullo said, "The relatively modest pace of recovery, the continued high rate of unemployment, subdued inflation trends, and well-anchored inflation expectations together suggest that the need for highly accommodative monetary policies will not diminish soon.”

Likewise, Donald Kohn, Fed vice chairman in a speech in San Francisco, said the Fed would raise rates, “in due course,” but he also noted that low rates "help offset the lingering restraining effects on economic activity and prices."

So far, rates have risen modestly, but analysts speculate they will likely become much more volatile down the road.

“It’s an uncertain type of market,” says Keith Gumbinger of HSH.com.

Michael Fratantoni, vice president of research and economics for the Mortgage Bankers Association, predicts that the Fed will have created a situation where there are days or weeks of low-rate opportunities, and other days and weeks when rates rise significantly.

Pending Home Sales Show Healthy Gain

2010-04-09T11:54:00.001-07:00

Pending home sales rose in February, potentially signaling a second surge of home sales in response to the home buyer tax credit, according to the National Association of REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in February, rose 8.2 percent to 97.6 from a downwardly revised 90.2 in January, and remains 17.3 percent above February 2009 when it was 83.2. The data reflects contracts and not closings, which usually occur with a lag time of one or two months.

Lawrence Yun, NAR chief economist, says the improvement is another hopeful sign. “The rise in buyer contact activity may signal the early stages of a second surge of home sales this spring. The healthy gain hints home prices are continuing to flatten,” he says. “We need a second surge to meaningfully draw down inventory and definitively stabilize home values.”

Pending home sales by region:

Northeast: the index rose 9.0 percent to 77.7 in February and is 18.9 percent higher than February 2009.
Midwest: jumped 21.8 percent to 97.9 and is 18.7 percent above a year ago.
South: increased 9.2 percent to an index of 107.0, and the index is 17.5 percent higher than February 2009.
West: the index fell 4.8 percent to 98.0 but is 14.6 percent above a year ago.

Source: NAR

Is now a good time to buy a home?

2010-04-09T10:18:00.001-07:00

I get asked this all the time. And my answer is always the same, “Yes!” Here are just a few reasons why:

1. Buyers Market! Right now we are in a buyers market. The inventory of homes is high and prices have still not bottomed out. There is a lot to choose from which gives you more opportunity to find the house that best fits you and your family’s needs.

2. Low Interest Rates! Current interest rates are sitting right around 5%. This is a great time to jump on the lower interest rate as they are expected to start to climb again, soon. Lower interest rate means a lower payment or a bit more in a house!

3. Tax Credit! Whether you are a first time home buyer or a repeat buyer, there is a credit for you. This is not a tax decuction, it is FREE money!

4. Buyers agent is FREE! As your buyer agent, I will cost you NO money for my services! I am licened in Washington and Oregon and love to help clients find their next home! Consider me your personal home finder! Give me a call and put me to work for you.

Earthquake Safety Tips

2010-03-16T09:57:00.000-07:00

Have an earthquake readiness plan

A little knowledge and a few precautionary measures can enormously increase your chances of surviving an earthquake - or any other type of hazard. The keys are education and preparing in advance. The earthquake safety tips below will not make you an expert. However, they could make a life-saving difference if you find yourself in an earthquake situation. Invest in your personal safety by studying below.

Consult a professional to learn how to make your home sturdier, such as bolting bookcases to wall studs, installing strong latches on cupboards, and strapping the water heater to wall studs.
Locate a place in each room of the house that you can go to in case of an earthquake. It should be a spot where nothing is likely to fall on you.
Keep a supply of canned food, an up-to-date first aid kit, 3 gallons (11.4 liters) of water per person, dust masks and goggles, and a working battery-operated radio and flashlights.
Know how to turn off your gas and water mains.

Before the Earthquake:

Learn how to survive during the ground motion. This is described in the "During the Earthquake" section below. The earthquake safety tips there will prepare you for the fast action needed - most earthquakes are over in seconds so knowing what to do instinctively is very important.
Teach all members of your family about earthquake safety. This includes: 1) the actions you should take when an earthquake occurs, 2) the safe places in a room such as under a strong desk, along interior walls, and 3) places to avoid such as near windows, large mirrors, hanging objects, heavy furniture and fireplaces.
Stock up on emergency supplies. These include: battery operated radio (and extra batteries), flashlights (and extra batteries), first aid kit, bottled water, two weeks food and medical supplies, blankets, cooking fuel, tools needed to turn off your gas, water and electric utilities.
Arrange your home for safety: Store heavy objects on lower shelves and store breakable objects in cabnents with latched doors. Don't hang heavy mirrors or pictures above where people frequently sit or sleep.
Anchor heavy appliances and furniture such as water heaters, refrigerators and bookcases.
Store flamable liquids away from potential ignition sources such as water heaters, stoves and furnaces.
Get Educated. Learn what to do during an earthquake (see below). Then you will be ready for the fast action needed. Make sure that all members of your family have this important education.
Learn where the main turn-offs are for your water, gas and electricity. Know how to turn them off and the location of any needed tools.
During the Earthquake:

If you are indoors, stay there. Quickly move to a safe location in the room such as under a strong desk, a strong table, or along an interior wall. The goal is to protect yourself from falling objects and be located near the structural strong points of the room. Avoid taking cover near windows, large mirrors, hanging objects, heavy furniture, heavy appliances or fireplaces.
If you are cooking, turn off the stove and take cover.
If you are outdoors, move to an open area where falling objects are unlikely to strike you. Move away from buildings, powerlines and trees.
If you are driving, slow down smoothly and stop on the side of the road. Avoid stopping on or under bridges and overpasses, or under power lines, trees and large signs. Stay in your car.
If Shaking Begins
Drop down; take cover under a desk or table and hold on.
Stay indoors until the shaking stops and you're sure it's safe to exit.
Stay away from bookcases or furniture that can fall on you.
Stay away from windows. In a high-rise building, expect the fire alarms and sprinklers to go off during a quake.
If you are in bed, hold on and stay there, protecting your head with a pillow.
If you are outdoors, find a clear spot away from buildings, trees, and power lines. Drop to the ground.
If you are in a car, slow down and drive to a clear place. Stay in the car until the shaking stops.
If Shaking Begins

Drop down; take cover under a desk or table and hold on.
Stay indoors until the shaking stops and you're sure it's safe to exit.
Stay away from bookcases or furniture that can fall on you.
Stay away from windows. In a high-rise building, expect the fire alarms and sprinklers to go off during a quake.
If you are in bed, hold on and stay there, protecting your head with a pillow.
If you are outdoors, find a clear spot away from buildings, trees, and power lines. Drop to the ground.
If you are in a car, slow down and drive to a clear place. Stay in the car until the shaking stops.

This would be a great email for one of your 33 Step Action Plans to send out to your clients today. Remember, you only need 250 contacts in your database and reach them 33 times to equal 50 transactions! These are real stats! I mass email things like this so you don't have to do the research, but can still touch your clients. Hope this helps, and thank goodness today's earthquake was a minor one! Please enjoy your beautiful day!

State of the California Housing Market Report

2010-03-10T14:40:00.000-08:00

First-time buyers, distressed properties drove California’s housing market in 2009, C.A.R. reports

LOS ANGELES (March 10) – Affordable home prices, tax credits for home buyers, historically low interest rates, and a large number of distressed properties prompted many first-time home buyers to enter the market in 2009, according to the CALIFORNIA ASSOCIATION OF REALTORS®’ (C.A.R.) 2009-2010 “State of the California Housing Market” report released today.

The percent of first-time buyers increased dramatically in 2009, from 35.9 percent in 2008 to 47 percent in 2009, according to the report. The share of first-time buyers exceeded the long-run average of 38.6 percent and was the highest since 1995, when more than half of all buyers were first timers.

“It is clear that the federal tax credit for home buyers worked well in 2009 and is continuing to drive home sales,” said C.A.R. President Steve Goddard. “The home buyers’ tax credit is arguably the most successful strategy employed by the government’s efforts to stimulate the economy.”

According to a survey conducted by C.A.R. on the effectiveness of the federal tax credit for home buyers, nearly 40 percent said they would not have purchased a home if the federal tax credit was not offered. On the same note, nearly 70 percent of these buyers said the tax credit was either “very important” or “most important” in their decision to buy a home. The large number of distressed properties led to more than half of all first-time buyers purchasing an REO/foreclosure or short sale property.

Statewide, REO/foreclosures and short sales accounted for almost half of all annual sales in 2009, an increase from 35.6 percent in 2008. The median price of distressed properties declined nearly one quarter to $250,000 in 2009 compared with $330,000 in 2008. Meanwhile, the median price of non-distressed properties decreased only 10.4 percent to $485,000 compared with $541,000 in 2008.

Many sellers sold their homes with a loss in 2009, and those who experienced a net cash loss increased for the fifth consecutive year. With one-third of sellers experiencing a net cash loss in 2009, it was the highest level on record since C.A.R. started tracking net cash losses in 1989, and was more than triple the long-run average of 9.3 percent. Following two consecutive years of significant declines in prices, the median net cash from home sales declined 50 percent last year to $50,000 from $100,000 in 2008.

Although sellers experienced a steeper net cash loss, lower home prices across the state sent affordability for first-time buyers to record-high levels in 2009. C.A.R.’s First-Time Buyer Housing Affordability Index (FTB-HAI) rose to 64 percent in the third quarter of 2009. The FTB-HAI measures the percentage of households that can afford to purchase an entry-level home in California and also reports first-time buyer indexes for regions and select counties within the state.

Affordable home prices also enabled first-time buyers to purchase larger homes. The average size of a first-time buyer’s house increased to 1,560 square feet in 2009 compared with 1,300 square feet in 2005. Nearly 80 percent of first-time buyers purchased a single-family home, a slight increase from 78.5 in 2008, but a significant increase from 2005 when only 61 percent of first-time buyers purchased single-family homes.

Lower home prices not only encouraged first-time buyers to purchase entry-level homes, but also lured investors. More than 70 percent of properties purchased by investors were either short sales or REO/foreclosures. The typical investment property was 1,367 square feet and had a median price of $232,750.

California’s median home price hit bottom in February 2009 at $245,170. Since then, the median home price has increased steadily in month-to-month comparisons, but remained below 2008 levels throughout 2009. The annual median price is projected to increase to $280,000 in 2010 from $271,000 in 2009.

Homes priced $500,000 or less dominated the sales mix throughout 2008 and early 2009, but peaked at 85 percent in January 2009. Meanwhile, the market share of homes sold for more than $500,000 increased from 15 percent in January 2009 to 25 percent in July 2009, holding steady around that figure for the remainder of last year.

Sales of high-end homes started picking up in late 2009, with the number of closings for homes priced $500,000 or higher rising 3 percent, and sales of homes priced $1 million or more experiencing their first year-to-year increase since July 2007. Statewide, annual sales of existing homes are projected to reach 527,500 units in 2010, a 2.7 percent decline compared with 2009’s annual rate of 540,000 units.

As conventional loans became more difficult to obtain, the percentage of FHA-insured loans as a first mortgage increased significantly in 2009. The percentage of home buyers utilizing an FHA-insured loan increased to 32 percent in 2009, compared with 18.9 percent in 2008, partially a result of the agency increasing its loan limit from $362,790 to $729,750. FHA loans typically require lower down payments and have less rigid credit-qualifying guidelines than conventional loans. The median down payment for FHA-insured loans was $9,888 compared with $92,000 for conventional purchase loans.

“Although the huge increase in the use of FHA-insured loans is of concern, the housing market will continue to stabilize as home prices slowly recover and discretionary sellers return to the market in 2010,” said C.A.R. Chief Economist Leslie Appleton-Young.

C.A.R.’s “State of the California Housing Market 2009-2010” report is free to members of C.A.R. or available for purchase for $49.95 in electronic format at http://www.rebsonline.com/category/57/. The survey is no longer available in hard copy format. Journalists who would like a complimentary copy of the report should e-mail markg@car.org or call (213) 739-8363.

Leading the way…® in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS® (www.car.org) is one of the largest state trade organizations in the United States, with more than 155,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

Get off the Nails in Your Life.

2010-03-04T10:50:00.000-08:00

There was a man who went to visit his friend in the deep bayous of Louisiana. As he approached his friend’s house he noticed his trusty old hound out on the porch moaning and howling lowly. Puzzled, tried to console the aggravated dog to no avail. When his friend came to the door, he asked why the dog was lowly howling. His friend simply replied that the dog had laid on a nail. Now completely confused, he asked "why doesn’t he just get off it?" His friend replied with a slow southern drawl, "I guess it doesn’t hurt that bad…"

This little story illustrates perfectly the concept of a toleration. They are things that we can do something about, but lack the motivation because they just don’t hurt bad enough to overcome the pain that comes with the discipline to do something positive. Think the papers on your desk, those extra 10 pounds, the prospecting activities that seem to always get put off until tomorrow or next week.

You are tolerating more than you think. We put up with, accept, take on, and are dragged down by people’s behavior, situations, unmet needs, crossed boundaries, unfinished business, frustrations, problems, and even our own behavior.

So what are you tolerating? Take a couple of minutes to write down stuff you that you are putting up with. Not the stuff you can’t change or have no control over, but things like that 5 lbs that hangs around because it really doesn’t bug you enough to motivate you to go to the gym. Or that pile of papers that has sat on the corner of your desk for the last 3 weeks.

As you think of more items, add them to your list. Do you have to do anything about them? No, not really. Just becoming aware of and articulating them will bring them to the forefront of your mind and you’ll naturally start handling, eliminating, fixing, growing through, and resolving these them

Bright Spots in California

2010-03-02T10:48:00.000-08:00

Three of the top 10 markets for rising prices are in California, a state at the heart of the real estate boom and bust. But because markets in that state were inflated earlier, many were well positioned to make a comeback even before the larger economy recovered.

That's true in the cities of Sunnyvale (in Silicon Valley), Poway and affluent Arcadia, outside of Los Angeles, where prices increased an average of 28%. Inventory has dropped in these markets, suggesting demand is up, and prices in California rose overall from January 2009 to August 2009. That's a natural seasonal trend for healthy markets, but it hadn't been reflected in California since the bust

California median price rises in January

2010-02-25T11:49:00.001-08:00

The median price of existing, single-family homes rose 15 percent in January, while sales declined 10.6 percent compared with the prior year, according to C.A.R.’s latest sales and price report. The median price of an existing, single-family detached home in California during January was $287,440, a 15 percent increase from the revised $249,960 median for January 2009, according to the report. The January median price declined 6.3 percent compared with December’s $306,820 median price. Statewide home resale activity decreased 10.6 percent from the revised 602,660 unit sales pace recorded in January 2009. Sales in January 2010 decreased 3 percent compared with the previous month.

“Many sales that closed escrow in January were on homes with offers accepted during the holiday season--a time when many house hunters are first-time buyers,” said C.A.R. President Steve Goddard. “First-time buyers typically purchase homes priced below an area’s median home price. Reflecting this, the percentage of homes priced under $500,000 increased to 77 percent of all sales in January, compared with 75 percent in December.”

2010-02-05T12:22:00.000-08:00

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.

Please click on this link to view the FEBRUARY-2010 Newsletter Housing Trends eNewsletter:
http://miltgalbraith.housingtrendsenewsletter.com?Newsletter_ID=242&Period_ID=182

The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau, Realtor.org reports and other sources.

It also includes press releases with charts and videos, key market indicators and real estate sales and price statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

If you are interested in determining the value of your home, click the “Home Evaluator” link for a free evaluation report:

http://miltgalbraith.housingtrendsenewsletter.com/dispContent.cfm?loadid=2&loadtype=0

Sound decisions can only be made with accurate and reliable information, and I am happy to be a trusted resource for you. Thank you for the opportunity to provide you with this monthly eNewsletter, and I look forward to answering any questions you may have and to the opportunity to be your REALTOR® in the future.

Sincerely yours,

Milt Galbraith
Ricci Realty
616 E Chapman Ave Orange Ca 92866
714-633-3600 | 714-743-0888
mgalbraith@socal.rr.com

10 Home Features Buyers Want

2010-02-05T12:17:00.001-08:00

Home designers and builders speaking at the recent International Builders Show in Las Vegas say that buyers are seeking cost-effective features and rejecting things that don’t have lasting value.

“It's all about family togetherness – casual living, entertaining and flexible spaces," says Carol Lavender, president of the Lavender Design Group in San Antonio.

Paul Cardis, CEO of Avid Ratings, which conducts an annual survey of buyer preferences, identified these must-haves in new homes:

1. Large kitchens with islands
2. Energy efficiency, including energy-efficient appliances, super insulation, and high-efficiency windows.
3. Home offices
4. Main-floor master suite
5. Outdoor living space
6. Ceiling fans
7. Soaking tub in the master suite and/or an oversize shower with a seating area
8. Stone and brick exteriors rather than stucco or vinyl
9. Community walking paths and playgrounds
10. Two-car garages, but three-car garages are even more desirable

Source: MarketWatch, Steve Kerch (01/30/2010)

HUD moratorium on FHA 90-day anti-flipping rule

2010-01-21T12:34:00.001-08:00

The Dept. of Housing and Urban Development (HUD) announced Friday it is instituting a one-year moratorium on the Federal Housing Administration (FHA) 90-day anti-flipping rule.

With certain exceptions, such as HUD-owned and bank-owned properties, FHA currently prohibits insuring a mortgage on a home owned by the seller for less than 90 days. However, beginning Feb. 1, buyers may use FHA-insured financing to purchase properties resold through private developers and investors, providing access to a broader array of recently foreclosed properties.

Under the temporary waiver, all transactions must be arm's-length, and most properties will require additional documentation of improvements and justification of the price increase. Additional documentation may include a second appraisal and a property inspection ordered by the lender.

C.A.R. recently submitted a letter to FHA Commissioner David Stevens detailing the challenges facing many home buyers using FHA loans, such as the lack of housing inventory available to FHA buyers, and the need for this rule to be revised to reflect current market conditions. The reexamination of the 90-day anti-flipping rule was passed as an action item during C.A.R.'s board of directors meetings in October.

New rules for FHA borrowers

2010-01-21T12:31:00.000-08:00

The Federal Housing Administration (FHA) today outlined future changes to the FHA home loan program. The changes first were proposed last month by Secretary of Housing and Urban Development (HUD) Shaun Donovan.

Rising defaults on FHA loans have led to the FHA’s cash reserves falling below federally mandated levels. FHA officials hope that policy changes will ensure borrowers have a stronger equity position and are less likely to default.

Policy changes include:

. Raising the up-front mortgage insurance premium: The premium will rise to 2.25 percent from its
current 1.75 percent. HUD is expected to release a Mortgagee Letter on Jan. 21 making the
premium increase effective in the spring.

. Raising the minimum credit score requirements: New borrowers will be required to have a minimum
FICO score of 580 to qualify for the FHA’s 3.5 percent down payment program. New borrowers with
less than a 580 FICO score will be required to put down at least 10 percent. FHA expects this to take
effect in early summer after it goes through the normal regulatory process.

. Reduce allowable seller concessions: The agency is lowering the maximum permissible level to 3
percent from its current 6 percent limit. FHA expects this to take effect in early summer after it goes
through the normal regulatory process.

Having a “can do” attitude

2010-01-14T11:03:00.001-08:00

Having a “can do” attitude - very valuable.

Knowing when “can do” won’t do - priceless.

There are times when you’ve done your due diligence, you’ve been honest every step of the way with everyone connected to a venture or project, and suddenly, everything you’ve worked so hard for blows up in your face. You re-attack the problem and it’s like throwing a pebble at a freight train. The problem continues to vex, frustrate you, and is costly to you, your business, and your relationships. The problem is here to stay. The good news is so are you. The scenario I’m presenting to you is not being stuck in traffic. I’m talking about something which has significantly challenged your beliefs, your methods, even your confidence. In other words something significant.

Usually when “can do” fails, the first step is to seek comfort in the arms of others. But when significance strikes, we realize all too well while can be part of the solution they can’t make the problem go away. Being willing to trust others and seek external answers is good. What isn’t good is the usual answer we hear when we’re looking for more than just comfort, but answers. We approach our pastor to be told “You have to have more faith”. We call our parents and are told “Don’t worry dear, your father and I think the world of you.”. Too bad your ex-client or boss doesn’t. A coach or mentor may say “Fake it ‘til you make it” or tells us to invoke the “Power of Positive Thinking”. We approach our spouses or significant others and initially receive a compassionate response. But after awhile we begin to be a drain on the relationship because what’s happened is so big we can talk of nothing else. Defeat happens and you need to understand what it is, how to get out of it, and where to go from there. However, an unguided or unstructured means of restoration will result in more heartache and more problems. As for the original problem, it now becomes a pattern.

So when our relationships don’t cut it we turn to books and that’s good too. The problem is there are way too many books which offer quick, general, and ultimately childish answers. Because we’re in an emotionally altered state, we don’t feel like wading through even more complexity loaded with the unknown. If we feel self-pity then it’s “Don’t Sweat the Small Stuff (and it’s all small stuff)”. What about when your wife is diagnosed with cancer? I guess that’s small stuff. Or, we’re attracted to the mystical such “The Secret”. Essentially “The Secret” is that whatever happens to you is up to you and you alone via “The Law of Attraction” (basically a regurgitated form of “Positive Thinking”). But what about when a pedophile kidnaps and murders an 8 year old child? I guess they attracted it. Or how about the earthquake in Pakistan in 2005 which killed 70,000 people? Did all of those people attract it?

Society is under the delusion that if we just try hard enough, if we’re diligent enough, and have enough heart, victory is assured. The truth is that we can do all of that and more and still sometimes it’s just not our time. Anyone who chooses to make a living based on passion, knows that it’s a matter of time until we tumble and have to change. If you are doing something which you have been called to do, you know that although defeat is a probability over time, it does not make us who we are. We’ve found that the best method to rebound is contained by the “Six Rs”. Let’s look at the amazing comeback of George Foreman as an example.

1. Relax. When a good boxer takes a blow flush on the chin, he’ll relax and absorb the blow will allow the force to flow through him, vs. into him. There’s a reason why in most fatal DUI crashes, the drunk tends to survive. That’s because he has very little tension in his muscles at the point of impact. What this would look like in real life is quickly confessing what just happened. In other words, acceptance. We all hate to lose. However, we have to go into any venture knowing that although “failure is not an option” it’s still possible. If you know who you are and can already envision what might happen (and therefore put it in its proper perspective) you’ll come out on top and rebound quickly. If you’re attacked by someone wielding a knife, you have to know that you’ll be cut at least once, if not several times before you can disarm the attacker. If you defend yourself knowing this already, the chance of going into shock is greatly reduced and so is the chance of you becoming a statistic.

When George Forman fought in his earlier years, he had an amazing amount of power behind his punches. Before he was knocked out by Muhammad Ali in the “Rumble in the Jungle”, he had dispatched the second most powerful boxer of his day, Joe Frazier in a mere 2 rounds. Ken Norton (who broke Ali’s jaw) met a similar fate. But when Foreman squared off against Ali, Ali refused to go toe to toe with Foreman. He danced, backpedaled when he had to, and repeatedly got Foreman in a clinch. Foreman would have to expend energy to untangle himself, and by round 7, against all odds and the unanimous view of the pundits and the public, George Foreman went down. Years later when he reentered the ring, Foreman, although still possessing plenty of power, chose to absorb the blows by staying relaxed vs. bulling his way through the fight.

The endstate of being able to relax is not to cover up what happened. It’s also not repeating that lie we’ve been uttering since boyhood; “That didn’t hurt.”. But being able to talk about it, limit it for what it is, and make sound decisions after the fact. Ultimately, relaxed looks like not experiencing frustration to the point of paralysis when you think about it or deal with it.

2. Remove. If something has you against the ropes and you can’t absorb anymore punishment, remove yourself from the situation. That doesn’t mean you have to quit your job or reconsider what you’re doing for a living. If you remove yourself, you’ll avoid making emotional (as in hasty or reactive) decisions. A sound decision is one which when executed, results in peace in your heart. Try to get away for a bit. Take some time off, take a vacation, but get out of striking distance of the problem.

After George Forman was knocked out by Ali, he was never quite the same again. After a lackluster performance in subsequent bouts, he collapsed in his dressing room one night and basically had an emotional collapse which resulted in his becoming a born-again Christian. He decided to enter into the ministry and raise a family, both of which he did very well. Boxing was his passion and because of that he was very appreciative of what boxing gave him. He knew that he was meant to box and still, despite his intense training regimen, his heart being 100% in it, and his 44-2 record (31 by knockout), it just didn’t happen. He removed himself from the boxing world, seemingly never to come back.

He still boxed as a hobby, still trained, and therefore kept in touch with the boxing world. But he had removed himself from the effects of the media, the ability for anyone to criticize him, or mention that he just wasn’t the “George Foreman of old”. That’s what successful removal looks like. You’re still aware of the problem, but you’re far enough from it financially, socially, and personally, where you know that despite the fallout and feedback, you’re in a safe place.

3. Replenish. This is where most of us go wrong. When we’re drained of energy and hope, we have to go somewhere to fill our tank. “Blowing off steam” is a part of the process. But the pursuit of pleasure, if it’s the core of what you do and think about, is not. It’s very seductive to sink back into the couch and zone out (“chillax” a friend of mine calls it) watching television. That’s ok, but ensure that you have a plan to get back up. The best way to do this is by a) accountability from a peer or coach and b) setting a time limit both long term and daily for leisure activity. And c) Selectively choosing the activities you will use to fill up your tank. Playing endless video games is neither relaxing nor replenishing. Most men play video games which entail shooting, killing, or some sort of competition (myself included). But when you’re done with your Halo or “Street Fighter” marathon, you’re not fulfilled, you’re spent. Try to focus on hobbies which entail some sort of creativity, something which is growth oriented. If it’s a video game, try one of the SIM games or even strategy games, something which uses your mind but doesn’t tax it. If you want to take a vacation, go somewhere relaxing, not Vegas. If you’re taking a break from your career or the market, choose something where you can come home everyday feeling somewhat fulfilled.

George Foreman’s boxing days were over (from his perspective) for quite some time. Yet in the interim he raised a family, developed a great church, constructed a youth center, and was willing to share his experiences on shows such as “The 700 Club”. Most importantly, he got his sense of humor back. Not by “keeping the dream alive” but by seeing what else he could do well, aside from boxing. You can tell where someone is emotionally by watching how they handle their pleasures. And what separates good men from great men, is how they spend their free time, how they connect with others when they’re down, and the sincerity of their reflection.

4. Review. This is usually where most men stop. You don’t have to indulge in debauchery in order to avoid the truth. You also don’t have to whip yourself endlessly (although you can expect this too). But if you want to stick it out, something has to change, usually you. We can keep doing what we do and succeed wildly at it for awhile. But eventually, conditions will change, either in your market, your industry, client base. Whatever it is, no one can get by doing the same thing over and over again no matter how brilliant their past performances were. If you’re properly and adequately replenished, then you’ll have regained your energy. Energy enables hope. And now you’re ready to review what you’ve done, what happened, and how you want to do things from here on out. If all of the above require changing who you are (and usually it does), then you’re ok with that too. What a review looks like is threefold: 1) Asking for counsel from a coach or mentor. A good coach can help you not only conquer lost ground, but to conquer yourself. 2) Being willing to conduct a thorough “AAR” (After Action Report) on not only what went wrong, but also what went right. Avoid the temptation to dissect your reasons for failure alone. 3) Refrain from taking anything which is said or discovered personally. In his book “Integrity”, Dr. Henry Cloud calls this process an “autopsy”. But just remember that you’re conducting an autopsy on something which will remain dead, be it a part of your character or way of doing things.

5. Re-Arm. George Foreman knew that he could no longer throw powerful combinations (a quick series of punches). Throwing a rapid succession of powerful punches like he used to would wear him out too quickly. And, although he had strength, he lost the 2 other “Ss” of punching power: speed and “snap”. Diminishing speed as you age is a given. And “snap” is the quickness and timing applied in retracting a punch. Think of striking someone with a whip. The pain you deliver is not from the whip hitting the unfortunate victim, but pulling back on the whip at just the right time so that the tip of the whip leaves a lash. However, rather than chase his ability to “snap” for endless hours in the gym for minimal overall return, he continued to get stronger and changed his strategy to overwhelm his opponents by sheer size.

What we’re getting at here is that when you decide to increase the lethality of your arsenal, you have to make what made you great even greater, and figure out a way to cover the gaps in your methods. If you spend the bulk of your time and effort working on your weaknesses, you’ll wind up having strong weaknesses. But you also have to find a way to manage your weaknesses. One of George Foreman’s weaknesses in his younger days was his attitude. In public, Foreman appeared morose and sullen. He appeared to be motivated by a grim determination. When he lost, boxing fans didn’t feel like they lost as well. But when he returned to the ring, he answered the borderline insults from the pundits with humor. In an upcoming bout with Evander Holyfield, a commentator said that Holyfield looked like a Greek god and Foreman looked like a Greek restaurant. In the commercial for the fight, Holyfield said that he couldn’t wait to wear the championship belt around his 32 inch waist. When the camera flashed to Foreman, he said “I can’t wait to wrap that belt around my 32 inch…..bicep!”. Foreman simply wasn’t attached to the outcome because God had asked him to do this. In addition to doing something he was literally called to do, he also repeatedly said that he wished to inspire “older folks” and show them that they were capable of more. This time, the American public had not only accepted Foreman, but adopted him as well.

6. Re-engagement. Against all odds, and with several losses along the way, Foreman, at the age of 45, regained the heavyweight championship of the world (and not against weak opponents either). His championship fight was against Michael Moorer, who was not only stronger, but had beaten the “Greek god” Evander Holyfield. Moorer was not only stronger and quicker, he also had a first rate trainer, Teddy Atlas who trained Mike Tyson in his rise to greatness. Years later, Teddy Atlas appeared on ESPN as part of a round table of boxing experts who were debating the greatest heavyweights of all time. When he was asked about how his protégé Moorer was knocked out, Atlas replied; “I knew we were in trouble when I saw him walking towards the ring. He was wearing the same trunks he wore the night he was knocked out by Muhammad Ali. I knew we were in trouble because any man who is willing to confront his past is dangerous.”.

The “Six Rs” are proven. They’re reliable not just for how to get out of a rut, but how to do better next time. This is because the “Six Rs” focus on how to be better next time. Following this method won’t undo your past. But it will make it irrelevant. Not by denial, not by avoidance, but by making it a part of who you are.

Happy New Year?

2010-01-04T11:34:00.001-08:00

Being the beginning of a new year, you may have developed a list of New Years resolutions. Having goals is excellent. Goals reflect a desire to be better than who we currently are. As the final seconds of the previous year count down, our hope builds and we say to ourselves “This year will be different.”. The ugly truth is that although 52% of us feel confident that we will be able to turn our resolutions into reality, only 12% of us actually do. And of that 12%, the overwhelming majority wishes it achieved their aims in a more cost-effective and less demanding way. The most cited reasons were lack of planning, poor situational awareness, and a narrow vision of what they really wanted to accomplish. An excellent case study in the mismanagement of all three of these key elements to goal attainment is Napoleon’s invasion of Russia.

The year was 1812 and Napoleon was the master of Europe. Against his wishes, Russia and England (the only two major powers he hadn’t conquered yet) continued to trade with one another. Napoleon’s strategic goal was to isolate Britain economically and politically. The purpose was to set the stage for a future invasion of England which he saw as his only remaining rival. The method would be a punitive expedition into Russia so severe that the Czar Alexander I would be compelled to cease trade with England and succumb to the economic system of the French Empire.

Planning: What set Napoleon apart from all other generals was his extraordinary attention to detail not only on the battlefield but also on the drawing board. Napoleon meticulously arranged for the construction of supply depots to enable the French army to achieve his objective of punishing Russia into compliance. We all know what happened next. What many don’t know is the true cause of the demise of the French army. “General Winter” did not destroy the French Army as many assume. It merely finished the job which Napoleon’s lack of oversight began. Although the lack of winter clothing resulted in a rout instead of an orderly retreat, Napoleon’s lack of a plan for resupply once in enemy territory literally snatched defeat from the jaws of victory. As a result within 8 weeks, the “Grande Armee” had suffered 50% casualties to disease, starvation, and desertion all without engaging in any large scale (and therefore decisive) battles. By late June the French army had slaughtered virtually all of its horses for food which crippled supply efforts since its supply wagons were horse-drawn. By the time Napoleon had crossed the Russian border, his army was literally feeding on itself. By September of 1812, the Grande Armee went from 690,000 effectives to only 135,000 again, without even fighting one battle. The plan had failed. There was no effort to modify it and not even talk of making a new one. Meanwhile the Russian army was nowhere in sight.

Situational Awareness: Success leaves clues. Fortunately, so does failure. More often than not, we receive signals along the way which, if handled properly, can allow us to maintain our even increase momentum. When we’re emotionally involved in a big project which has already incurred high cost and commitment on our part, the temptation to “drop the shoulder” and continue to attack increases. There’s a satisfaction in doing what others told you could not be done. But when the thrill of victory dissipates, have you reached your true objective?

A month before entering Moscow, Napoleon finally found and fought the Russian army at the Battle of Borodino. The hope of inflicting a decisive defeat didn’t materialize. Borodino was a nasty, vicious, bloody battle which accomplished nothing. Although the Russians withdrew, the “Grand Armee” was now down to 95,000 men. Taking Moscow was questionable and holding it was impossible. The army would be lucky to make it back to France much less ask anything of Czar Alexander.

It was time to stop, reassess, and ensure actions aligned with goal achievement and resources could handle reality. Virtually all of Napoleon’s advisors urged him to at least stop and consider the situation. Napoleon would have none of it. He had succumbed to the “sunk cost fallacy” which is basically a reluctance or refusal to change a course of action due to overfocus on resources committed or already spent. What’s needed is not necessarily quitting or abandoning your aims. However, when setbacks accumulate to the point of not only compromising the goal but bringing you to the point of ruin, it is definitely time to stop, review, and seek counsel.

Vision: There is a Japanese proverb which states “Vision without action is a daydream, action without vision is a nightmare.”. The purpose of the campaign was to force Russia to cease trading with England. That’s it. When losses accumulated and it seemed that Napoleon could actually “lose” he changed his mind to achieve a goal which was “doable” but would not support his original intention. Napoleon’s army did reach Moscow by mid-September. However, the residents had fled (including Czar Alexander) and burned Moscow to the ground. Because Napoleon had compromised his vision, his judgment followed suit. Consequently the master of Europe forgot that winning a war was no longer about taking a capital city and being presented with the keys. After leaving France with 695,000 experienced and competent soldiers, the Grand Armee returned to France with only 5,000 stragglers. Napoleon, having abandoned his troops in the field, returned to France only to be handed over to his enemies. His original vision of a French Empire which could act with impunity had crumbled around him. His country paid for his lack of planning, his army paid for his lack of situational awareness, and a promising future for both himself and France paid for his lack of vision.

Napoleon is but one of many individuals who have failed to achieve enormous goals due to poor planning and unwillingness to see the truth. Many top-ranked executives, small business owners, generals, and others have gone this route. However the ones who manage to recover momentum and achieve something truly significant know the difference between a risk and a gamble. The difference is best summed up by Erwin Rommel, a great general in his own right; “A risk is a chance you take; if it fails you can recover. A gamble is a chance taken; if it fails, recovery is impossible.”

In order to assume risk with confidence, develop a plan which is solid and flexible. Understand what your blind spots are and employ people who can tactfully point them out. Seek the company and counsel of those who are experienced enough to remind you when you are straying from your integrity, values, and vision. Or, you can roll the dice. The choice is yours.

Small Projects, Big Bang

2009-12-31T11:59:00.000-08:00

Judicious home remodeling is still worth the investment, according to Remodeling magazine's annual "Cost vs. Value Report."
By G.M. Filisko
Uncertainty and restraint are the order of the day in this economy, and that sense of caution is reflected in home owners’ return on their investment in remodeling projects, according to REALTORS® in 80 metropolitan markets surveyed by Remodeling magazine for this year’s Cost vs. Value Report.

The majority of the 10 remodeling projects with the best return on investment nationally are a testament to pragmatism. Six of the 10 projects—siding and window replacement using a variety of materials—involve home maintenance that costs less than $14,000.

Two more—adding an attic bedroom or a wood deck—reinforce the notion that boosting the amount of livable space in and around your home will attract buyers who are increasingly looking for more room for their buck. In past years, converting an attic into a bedroom was a project that landed squarely in the middle of the rankings, but this year it leapfrogged over other categories into third place. It’s an admittedly pricey project, with an average national cost of nearly $50,000, but it generates an average national return of 83.1 percent and a better-than-100 percent return on investment, according to REALTORS® in 14 of the 80 cities surveyed. Adding a wood deck is much more economical, with an average national cost of slightly more than $10,000. Its average national return is 80.6 percent, but in six cities, its return is estimated at 100 percent or greater.

The six siding and window home maintenance projects in the top 10, combined with the project with the biggest return on investment—a mid-range entry door replacement—prove something that every sales associate tells sellers throughout the country: First impressions count. A mid-range entry door replacement, a project new to the survey this year, is the only home remodeling project that REALTORS® expect to generate a full return for the money nationally. It’s the least expensive of the 33 projects included in the analysis, yet it brings a whopping average national return on investment of 128.9 percent. It generates a better-than-100 percent return in 48 of the 80 cities, according to REALTORS® surveyed, and in several cities, its return is estimated at more than double its cost.

Additional data prove the value of restraint. Upgrading kitchens and baths is still a smart bet. However, home owners will recoup the greatest share of their costs by foregoing super-deluxe projects in favor of mid-range kitchen and bath remodels. A mid-range kitchen remodel brings an average 72.1 percent return on investment, while an upscale kitchen re-do returns only an average of 63.2 percent of the money invested. A mid-range bathroom project has an average 71 percent cost recovery, but the average recovery on an upscale bathroom project is nearly 10 points lower, at 61.6 percent.

The only upscale projects that cracked the top 10 were the home maintenance projects of fiber-cement siding replacement and vinyl window replacement. The average cost of fiber-cement siding is more than $13,000, but its return on investment reached 83.6 percent, placing it squarely in second place in the survey. The average cost of vinyl window replacement is nearly $14,000, and it generates an average return of 76.5 percent, or tenth place in the survey. Of the 12 upscale projects, nine landed in the bottom half.

Overall, home owners recouped an average of 63.8 percent of their investment in 33 different home improvement projects, according to REALTORS® who responded to the survey. The expected cost recoup was generally down from previous years in line with the drop in home prices nationally (see page 23). The return on home owners’ investment in remodeling projects has declined an average of 3.5 percentage points between 2008 and 2009. That’s down from the 2.7 point drop between 2007 and 2008 and much less than the 5.5 point drop between 2006 and 2007 and the 10.5 point drop from 2005 to 2006.

Zooming in from the national to the city level, Honolulu sits atop the rankings for having the most projects—18—that generate at least a full return on investment. In Honolulu, adding a wood deck, completing a minor kitchen remodel, adding fiber-cement siding, and replacing an entry door bring the highest returns, ranging from 121.1 to 195.3 percent return on investment. San Francisco is closest behind with 10 projects generating at least a full return on investment. Adding a master suite, doing a minor kitchen remodel, and replacing an entry door have the biggest returns, producing between 112.2 and 119.1 percent return on investment.

One surprise: Despite the common perception that contractors are hungry for work and therefore willing to wheel and deal, the average national cost of every project surveyed has gone up, though at a slower rate than in the previous year.

Useful Work Phrases

2009-12-15T10:01:00.001-08:00

I was reading through some very old archived items on my hard drive searching for inspiration and came across this and it made me laugh (It’s been one of those mornings). Hope you enjoy!

Useful Work Phrases

1. Thank you. We’re all refreshed and challenged by your unique point of view.

2. The fact that no one understands you doesn’t mean you’re an artist.

3. I don’t know what your problem is, but I’ll bet it’s hard to pronounce.

4. Any connection between your reality and mine is purely coincidental.

5. I have plenty of talent and vision. I just don’t care.

6. I like you. You remind me of when I was young and stupid.

7. What am I? Flypaper for freaks!?

8. I’m not being rude. You’re just insignificant.

9. I’m already visualizing the duct tape over your mouth.

10. I will always cherish the initial misconceptions I had about you.

11. It’s a thankless job, but I’ve got a lot of Karma to burn off.

12. Yes, I am an agent of Satan, but my duties are largely ceremonial.

13. No, my powers can only be used for good.

14. How about never? Is never good for you?

15. I’m really easy to get along with once you people learn to worship me.

16. You sound reasonable. Time to up my medication.

17. I’ll try being nicer if you’ll try being smarter.

18. I’m out of my mind, but feel free to leave a message.

19. I don’t work here. I’m a consultant.

20. Who me? I just wander from room to room.

21. My toys! My toys! I can’t do this job without my toys!

22. It might look like I’m doing nothing, but at the cellular level I’m really quite busy.

23. At least I have a positive attitude about my destructive habits.

24. You are validating my inherent mistrust of strangers.

25. I see you’ve set aside this special time to humiliate yourself in public.

26. Someday, we’ll look back on this, laugh nervously, and change the subject.

Buying a Home in Time to Get Credit

2009-12-15T09:57:00.000-08:00

House hunting usually slows down this time of year, as people put their searches on hold during the holidays.

This winter could be different, however, thanks to the extension -- and expansion -- of the first-time home-buyer tax credit.

"We're going to see far more interest in the fourth quarter than we generally do because of the tax credit," says Heather Fernandez, vice president of Trulia.com, a real-estate search engine. Traffic surged on the site on Nov. 5, the day Congress approved the credit extension, she says.

The new law extends the tax credit for first-time home buyers and opens it up to some existing homeowners as well: The credit is now up to $8,000 for first-time buyers and up to $6,500 for repeat buyers.

All buyers must have a binding contract on a house in place on or before April 30. The purchase must be for a principal residence and must close on or before June 30.
To be considered a first-time home buyer, an individual must not have owned a home in the past three years. And to be eligible, existing homeowners need to have lived in the same principal residence for five consecutive years during the eight-year period that ends when the new home is purchased.

Income limits have risen as well. According to the Internal Revenue Service's Web site, the home-buyer tax credit phases out for individuals with modified adjusted gross incomes between $125,000 and $145,000, and between $225,000 and $245,000 for people filing joint returns.

The inclusion of move-up buyers might inspire homeowners to take action and list their house if they've been putting it off, says Carolyn Warren, a Seattle mortgage broker.
"If people love their home, it's not going to entice them to sell," Ms. Warren says. "If they've had it in the back of their minds and really would like to move up, it might push them into doing it sooner than later."

If you're thinking of purchasing a home, here are five tips:
Don't procrastinate
Start your house search now. Getting an early start will give you a better chance of finding the right house before the credit deadline.

When first-time buyers thought that the credit would expire Nov. 30, people scrambled to find properties in September and October, says Pat Lashinsky, chief executive of ZipRealty, a residential real-estate brokerage firm. In some cases, "there wasn't inventory that fit people's needs," he says. In some markets, including Phoenix, Chicago and parts of California, for example, properties had multiple bidders, Mr. Lashinsky adds.
Before you start house hunting, get preapproved for a mortgage, says Eddie Fadel, a Miami-based mortgage banker. And do a realistic assessment of what you can afford.
Buyers who have to sell an existing home should price it aggressively from the beginning to drum up interest and get a buyer as soon as possible, Ms. Fernandez says.
Don't count on another extension

The credit won't be available forever, Mr. Fadel says.
"This is a medication for the housing crisis," he says, "Once the patient -- which is the housing market -- is cured, there will be no medication needed."

Be mindful of interest rates
Interest rates are low right now, but will likely rise next year, Ms. Warren says. Higher rates will affect your monthly mortgage payments, thus the affordability of the house you are buying.

"It's pretty universally accepted that rates will be higher next year," she says. "What is unknown is how fast and by how much."
Average rates on 30-year fixed-rate mortgages have been hovering around 5%. But when the Federal Reserve stops buying large amounts of mortgage-backed securities next year, interest rates could rise, Ms. Warren points out. The Fed plans to end its purchase program in March.

Communicate with your lender
Make sure you're speaking with your lender regularly to avoid any delays. If the lender asks for any additional documentation, turn it in as soon as possible, says Doug Heddings, a New York-based real-estate agent with Charles Rutenberg Realty.

And think twice before pursuing a short sale. That's where someone sells a home for less than what he or she owes on a mortgage, with permission of the lender. The process can be lengthy and unpredictable because the homeowner's lender has to approve any deal, Ms. Warren says, and it can get complicated when there is a second mortgage associated with the property.
Don't take shortcuts

Don't forgo any of the steps you would normally take just to make the tax-credit deadline. That means making sure the house is a good fit and is in the right location and getting a home inspection, Mr. Lashinsky says. Skipping steps could cost you in the long run.

"Don't let the tax credit get you to make a decision to buy a house that you wouldn't otherwise want to buy," he says. "Don't shortcut the process to get the tax credit."

"USA Today" Survey shows spike in first-time home buyers

2009-12-15T09:56:00.000-08:00

SAN DIEGO — The U.S. housing market welcomed a bigger share of first-time buyers and single women this past year, while a majority of sellers resorted to dialing down prices to get their homes sold, a new home buyer survey shows.
First-time buyers accounted for a record 47% of U.S. home sales between July 2008 and June this year, up from 41% in the prior-year period, according to the survey conducted by the National Association of Realtors.
The annual survey gleans details on everything from how buyers came up with down payments to how long it took sellers to unload their homes. The latest results were derived from more than 9,000 responses, the trade association said.
Home sales and prices have shown some signs of stabilizing this year, and the survey results affirm the market continued to favor buyers, particularly first-timers.
HOUSING FORECAST:Home prices to rise 4% in 2010
"Tax incentives, record high affordability conditions and a pent-up demand brought a record share of first-time home buyers into the market," said Paul Bishop, the trade association's vice president of research.
First-time homebuyers this year have been able to take advantage of a tax credit of up to $8,000 meant to entice new home buyers to enter the market.
Congress extended the tax incentive through next June, as long as the buyer signs a binding contract by the end of April. The program also was expanded to include a $6,500 credit for existing homeowners who buy a new place after living in their current residence for at least five years.
First-time buyers had a median age of 30 and reported a median income of $61,600, the survey shows. The typical first-time buyer paid $156,000 for their home, about $9,000 less than in the Realtors' 2008 survey.
Repeat buyers were typically a few years older, 48, and earned a bit more than first-timers: $88,100. They also said they planned to stay in the home for 12 years.
Sellers had to go the extra mile to sell their homes, with 52% offering incentives like paying for closing costs. They also lowered prices.
The typical home sold for 95% of the original listing price, the survey shows.
Still, many sellers came out ahead. The median amount over the price sellers originally paid for their home was $36,000.

Predictions on Future Mortgage Rates

2009-12-07T10:14:00.000-08:00

What will happen to mortgage rates if the Federal Reserve stops buying mortgage-backed securities next March?

If and when that program ends, mortgage rates will rise, but most financial observers say it is very likely they won’t skyrocket.

Keith Gumbinger, a vice president at financial publishers HSH Associates, predicts that the end of Fed intervention will push rates up about three-quarters of a point for a 30-year conforming loan–somewhere in the mid-5 percent range. By late 2010, Gumbinger says the rate will be closer to 6 percent.

Michael Larson, a real estate analyst at Weiss Research, is dubious that the Fed will actually end the program. He contends that the Fed will continue buying mortgage backed-securities as long as the housing recovery is tenuous. And as long as the Fed continues to dominate that market, “we’re not really going to move the needle on rates,” Larson says.

Tax Credit Quandaries Answered

2009-11-30T15:55:00.000-08:00

The complexity of new home buyer tax credits leaves potential buyers with many questions. Here are answers to some of the most confusing: How does a current home owner qualify for the $6,500 credit?Buyers must have lived in their homes for at least five out of the last eight years. The home they buy must become their primary residence, but buyers don’t have to sell their previous home. They can use the previous home as a rental or a second home and still claim the credit.Does the new home have to be more expensive than the one the buyer currently owns?No. It is fine to use it to downsize. If the property sells for more than $800,000, the buyers don’t qualify.Can buyers who are building a new home claim the credit? Yes, although the contract must be in place by April 30 and the buyer must move in by July 1.Can buyers claim the credit if they purchase a home from a relative? No. The legislation prohibits taxpayers from claiming the credit if the sale is between “related parties,” including parent, grandparent, child, or grandchild.

Rates on 30-year mortgages remain below 5 percent

2009-11-24T10:33:00.001-08:00

McLEAN, Va. -- Rates on 30-year mortgages stayed below 5 percent this week but remained above the record set earlier this year, Freddie Mac said Thursday.
The average rate for a 30-year fixed mortgage fell to 4.83 percent, down from 4.91 percent last week, the mortgage company said. Last year at this time, 30-year mortgages averaged 6.04 percent.
Rates hit a record low of 4.78 percent in the spring, and remain attractive for people looking to buy a home or refinance their existing mortgage. Still, credit standards remain tough, so the best rates usually are available only to borrowers with solid credit and a 20 percent down payment.
The Federal Reserve has pumped $1.25 trillion into mortgage-backed securities to try to lower rates on mortgages and loosen credit. Rates on 30-year mortgages traditionally track yields on long-term government debt.
Low fixed rates in the third quarter led to about $1.1 trillion in refinancing activity, saving borrowers about $10 billion in monthly payments over the first 12 months of their new loan, said Frank Nothaft, Freddie Mac's chief economist.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, frequently in line with long-term Treasury bonds.
The average rate on a 15-year fixed-rate mortgage fell to 4.32 percent from 4.36 percent last week, according to Freddie Mac.
Rates on five-year, adjustable-rate mortgages averaged 4.25 percent, down from last week's 4.29 percent. Rates on one-year, adjustable-rate mortgages declined to 4.35 percent from 4.46 percent.
The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac's survey averaged 0.7 point for 30-year loans. The fee averaged 0.6 point for 15-year, five-year and one-year loans.

Extension and expansion of federal tax credit

2009-11-06T11:59:00.000-08:00

Homeowners win big with extension and expansion of federal tax credit

The U.S. House of Representatives today voted 403 to 12 to extend and expand the home buyer tax credit. The bill passed the U.S. Senate late yesterday and now will go to President Obama for his signature, where it is expected to be signed this week.

The tax credit will be extended through April 30, 2010, with a 60-day extension if a binding contract is in place prior to the deadline. First-time home buyers will continue to receive a tax credit of up to $8,000, while existing homeowners will receive a credit of up to $6,500. Existing homeowners will be eligible for the $6,500 if they have lived in their current residences for at least five years. The bill also will increase the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to $125,000 and $225,000, respectively. The purchase price of the home is capped at $800,000.

Under additional provisions in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns. The bill maintains the provision that home buyers do not have to repay the credit, provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.

For weeks, the CALIFORNIA ASSOCIATION OF REALTORS (C.A.R and its members have urged Congress and the U.S. Senate to extend and expand this crucial piece of legislation.

Nationwide, more than 1.4 million first-time home buyers were given the opportunity to become homeowners as a result of the Federal Tax Credit for First-time Home Buyers. According to C.A.R. research, nearly 40 percent of first-time home buyers surveyed said they would not have purchased a home without the federal tax credit, and approximately 70 percent said the tax credit was "the most important" or a "very important" factor in their decision to buy a home

Your Personal Mission Statement

2009-10-20T14:32:00.000-07:00

One of the most powerful things in your life is your vision (or lack thereof) and your perceived mission.
To help crystallize direction for your life and business develop a personal mission statement. Ask yourself what you alone you can do. Not what can you do, but what is it that won’t get done if you alone don’t or won’t do it.

Here’s a simple guide to developing your personal mission statement -

Definition of Mission - The special duty or function for which someone is sent as a messenger or representative; and the special task or purpose for which a person is apparently destined in life; a calling.

What is your personal mission statement? - Your personal mission statement focuses on the special purpose you want to achieve in your life and the special approach you will take to achieve it. It is the consequence of your mission being achieved. It is a description of how the world will be after you’ve traveled through it.

A clarifying question - “If we were meeting back here on ______________________, and you were looking back over the preceding ______________, what would have to have happened during those years for you to feel really good about yourself, your life, and the fulfillment of your personal vision?”

Answer this question to state your Personal Mission Statement- “My unique mission is…”

Once we have vision and mission clearly identified, it becomes very easy to make life changing decisions. Whenever I am faced with a fork in the road of life, The answers will simply fall into place when I simply weigh my options against my vision and mission and ask - “Is this in line with who I am?” and “Does this bring me closer to where I know I need to go?”

The First Step is Always the Same

2009-10-20T10:56:00.000-07:00

When it comes to achieving your financial goals the first step is always same. No matter where you are on the financial spectrum everyone starts with the same first step. Whether you want to retire, start a business, go on a dream vacation, buy a second home, start a college fund for the kids, or whatever your financial goal it all starts with one simple step. Save money! It may be simple but that doesn’t necessarily translate into being easy. In order to have the tool you need to actively pursue your dreams you have to spend less than you make.

“We are all self-made. But only the successful will admit it.” Unknown

In the 1940 essay, The Common Denominator of Success Albert E.N. Gray tells of his journey to discover the secret to success. After pouring through numerous biographies, autobiographies, dissertations, and the lives of successful men, Mr. Gray discovered this powerful and vitally important common denominator. “The common denominator of success - the secret of success of every man who has ever been successful - lies in the fact that he formed the habit of doing things that failures don’t like to do.” (Albert E.N. Gray, 1940).

If you want to be financially successful you must separate yourself from the masses. You must be able to do the things that most others do not like to do. For us the first step is clear, you must live within your means, you must save money. The following chart from the Bureau of Economic Analysis, U.S. Department of Commerce shows us that the vast majority of Americans do not save money and/or those who do save very little.

Thus applying the common denominator of success you can see that the first step is critical because you will be doing something that most people fail to do. Think of it this way: Being Financially Independent => In the Minority <= People Who Save Money.

So why haven’t I been able to save money? Once we understand the importance of saving money and how it puts us on the track to wealth we change our attitude and become motivated. The problem is that motivation and attitude are not enough. In order to be successful you must transform your words, thoughts, and efforts. These three transformations are true for financial success and are definitely applicable for implementing the first step. In order to achieve your financial goals you must transform the words you use, you must transform how you think, and you must transform where you place your efforts. For some this may be a reminder and serve to refresh and refocus what you are already doing. For others this may be new and will require a little introspection to grasp how this works. Because it is so important to our future success we will explore these three transformations further. Remember it’s simple but not necessarily easy.

The first transformation required for success seems inconsequential but is possibly the most important of all transformations. Transforming your words. One of the most powerful things you can do is to change your vocabulary. Vocabulary is a big part of learning any new specialty. If you want to achieve success in a particular field you must learn the vocabulary. Doctors, Lawyers, and Wall Street Brokers all use their own language. Words affect our thoughts, thoughts affect our actions, and actions affect our success. We all know the subtle difference between “I need” and “I want” or “I can” or “I can’t”. The words you use set the stage, they program your life.

If you want to save money you have to change the words you use. For example, some of us like to justify our spending by saying “I deserve it” but what we should be asking is “Can I afford it?” meaning what will it cost me in terms of achieving my financial goals and dreams. You can treat yourself but only to the extent that you can afford it and it doesn’t detract from your financial goals. If you’re always saying that “I never have enough money” and “I can’t save a dime” then what is the most likely outcome. It truly is the little decisions that compound over time to add up to wealth or indebtedness. When you consciously understand the impact of the little decisions you begin to change the words you use and that changes the way you think.

Transforming your words is not enough you must also transform your thoughts. Thoughts shape your life. If you want to change something in your life you must change the way you think. Often times the reason we don’t save money is because we think it is about denying yourself. If you operate out of this paradigm you will find saving money to be an unrewarding activity. You’ll feel that you are constantly giving up things, denying yourself, and missing out. Through that paradigm it’s no wonder you don’t save money (i.e. spend less than you make.)

You must shift your paradigm and see saving money for what it really is. It’s about opening up opportunity, about giving yourself the one tool you need to actively pursue your dreams. Saving money isn’t about denying yourself it is about taking control and becoming actively engaged in building wealth and creating possibilities. You can’t retire, start a business, go on a dream vacation, buy a second home, start a college fund for the kids, or achieve any financial goal without saving. Still some people plan on a windfall or the winning the lottery to achieve these goals. They never realize the power to change and to achieve their financial goals is as simple as spending less than you make. Once you make the paradigm shift you begin to transform your thoughts you’ll look at saving money in a whole new way. No longer is it about denial. Instead it is about unlocking the life you’ve dreamed and reaching your financial goals. Shifting your paradigm to this new way of thinking revolutionizes the decisions you make about money and directly impacts your desire and ability to save money. With this knowledge in hand you’ll begin to transform your efforts.

”If you want something you’ve never had you have to do something you’ve never done.”
Transforming your efforts requires a change in the way you have approached things in the past. We must make decisions and choices that we have not been making (usually the ones we know we should make but don’t). Some have this part locked on but others know they could be putting forth more effort. But effort for effort’s sake is not the point. Misguided effort just compounds the problem. The key is to focus on what you can control. You could be putting forth tremendous effort but if your efforts are focused on things you can’t control you will get frustrated and withdraw.

This is especially true when it comes to the little things. For example, if you have made a commitment to saving and someone asks if you want to spend money on a new Rolex you’ll probably say no and stay committed to our goals. However if you’re hungry and you’re asked if you want to go out to eat you might easily say yes. Then while out to eat you figure what’s a few extra dollars for desert and/or drinks. Next thing you know your spending money on things you really don’t want. We must be consciously aware of the little things that sneak up and cause us to lose focus on what is truly important in our financial picture.

It’s important that you focus on the things you can control not on the things you can’t. Most of us spend time focusing our efforts on things we can’t control at the expense of things we can. For example, we hear about people concerned about the price of gas but for most of us, despite the hype, there is very little we can do to affect the price of gas. Despite complaining about gas it doesn’t stop some from driving to the mall and spending money on clothes they don’t really need. Often we think we don’t have enough money because we don’t make enough money. So we don’t coupon shop or recycle cans (things within our control) because that stuff seems insignificant. Instead, we focus on how much money we make (out of our control) which causes us to lose focus on the everyday little things we can do.

The key to transforming your efforts is to walk your talk or at least, in the beginning, stumble your mumble. Focus your efforts on things you can control and make decisions and choices about what you will do with your money based on what is truly important to you. There are lots of little decisions that add up over time and mean the difference between success and failure. You should endeavor to align your efforts with reality, to focus on the little things you can control and stop using the big things as a distraction or excuse.
The first step is the same for everyone no matter how much money you have. You have to save money, you have to spend less than you make. If you make a million dollars and spend $1.2 million then you are broke. Remember, the rich have the same problems as everyone else just with more zeros. In order to accomplish this simple yet sometimes difficult task we must transform our words, thoughts, and efforts. Our words, thoughts and efforts have immense power. Choose them carefully and begin to create a successful life and achieve your financial goals.

Double-digit mortgage rates on horizon?

2009-10-16T13:21:00.000-07:00

At a recent real estate conference, I found myself standing next to Richard Williams, a Century 21 Realtor from the Atlanta area, who had founded something called Clickit Inc., which provides flat-fee pricing for sales and listings. I would say we chatted, but Williams is a born raconteur and I mostly just listened.

After a while, a young man from New York joined us and in the course of the shifting conversation, the Big Apple dude wistfully noted he was renting an apartment but considering buying a condo. Williams turned his attention to the young fellow. "Now is the time to buy," he exclaimed.

The reason for Williams' emphasis on buying now? Was it because housing prices had gotten so low that good deals were everywhere? Actually, no. Williams strongly suggested to the New Yorker he should make his investment sometime this year as expectations are that interest rates were bound to rise and wouldn't stop climbing until they hit double digits. That would make any future purchase considerably more expensive than it would today.
I, too, expect interest rates to start heading north again, but double digits seemed far out there -- not in terms of a time line, but psychologically.

Williams rationalized that at some point in the near future, the economy was going to elevate very dramatically, which would raise the specter of inflation. If that happened, the Federal Reserve would push up interest rates to keep inflation under control.
I didn't disagree with that scenario. However, I don't believe the economy, when it does turn around, will take off like a rocket, so the government's need to contain a budding inflationary climate would be moderate at best.

There are other factors to consider as well.
Interest rates have been kept low since the short recession at the turn of this century, and this was one of the causes of the housing bubble that lasted until 2007. Once the economy stabilizes, I figure the Fed might want to raise interest rates, thus slowly bringing them back to more sustainable levels, something like 3-4 percent.

Then there is the massive pumping of stimulus dollars into the economy.
Globally, the first major nation to experience economic recovery has been Australia, and there is already speculation interest rates will start to rise there. Now, tell me if this doesn't sound familiar: as the Wall Street Journal reported, Australia's recovery comes at a time "when huge amounts of government stimulus are still coursing through the Australian economy, raising fears of higher inflation in the years ahead if the central bank doesn't start raising rates fairly soon."
All those stimulus dollars have to come from somewhere. Sure, we could just print more money, but that would be hyperinflationary, so the federal government, instead, borrows it, which is less inflationary.

There are concerns about the budget deficit, which "looks like it is going to be huge," notes Celia Chen, a senior director at Moody's Economy.com. "If the budget deficit is too large, then the government is borrowing a lot and having to issue more Treasury bonds. That will cause the price of Treasuries to fall and if that happens, yields have to increase and interest rates will rise."
No matter, how one slices and dices the economic prestidigitations, pressure continues to build on the government to raise interest rates, probably next year.

"There is no doubt that interest rates are going to have to go up," says William Conerly, an economic consultant and author of "Businomics From the Headlines To Your Bottom Line: How To Profit in Any Economic Cycle."

At some point the Federal Reserve is going to have to worry about inflation, Conerly adds. "Certainly not in 2009, but in 2010 the Fed will probably start pushing up short-term interest rates. If the economy gains some steam in the second half of this year, the long-term markets will push rates up even before the Fed tightens, so we'll see Treasury yields rise even further between now and spring 2010."

As of the third quarter, the spread between mortgages and the 10-year Treasury was wider than normal, which will narrow, but that won't be enough to prevent the cost of borrowing from getting more expensive. Does that mean Richard Williams was on target in soothsaying interest rates and subsequently mortgage rates will be heading into the double-digit range, thus making home purchases considerably more expensive?

In summer 2009, mortgage rates had risen from below 5 percent earlier in the year to about 5.2 percent, and Conerly's predictions are that the 30-year fixed mortgage rate will climb to 7.7 percent at the end of 2010.

Chen's crystal ball shows a more conservative picture. "We have the fixed-rate climbing to 6.6 percent in 2010," she says. "We expect mortgage rates to rise to 6.9 percent in mid-2011 and we don't have those numbers going above 7 percent until the year 2012."

Chen expects a reasonable economic rebound but inflation remaining at bay. Still, she recognizes there are some risks ahead. "Those predicting a higher mortgage rate are worried about too much credit on the market and the Fed having to keep inflation from creeping back," she adds.
I bought my first home back in the 1970s. Apparently, sometime around then so did Conerly, because we both remember having to acquire homes at double-digit interest rates. Indeed, it wasn't until 1985 that interest rates fell below double digits. The concern about interest rates rising past what to some is the seemingly astronomical 6 percent mark brings considerable levity to Conerly's demeanor.

"I hear real estate brokers whining that interest rates, which have been at record lows, may go up to 6.5 percent," he says. What these brokers don't realize, he adds, "is that they are really living in the golden age of mortgage rates."

Steve Bergsman is a freelance writer in Arizona and author of several books, including "After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade."

The new REO reality: above-asking offers

2009-10-16T13:18:00.000-07:00

Q: I am in the market for a new home, and I am worried. My friend recently put an offer in on a house of $109,000, which was the list price. The bank came back with a counteroffer of $150,000! Is that even ethical? Can the bank really do that? Is that something I should be looking out for?

A: Your question reflects the essence of why I write this column. I know that's a little heavy, but let me explain. Hindsight for hindsight's sake sounds a little too much like fodder for guilt or blame or regret for my tastes. Those are probably three of the most counterproductive of all the human emotions, and definitely cause more harm than good.

But looking back at what happened in your own -- or a friend's -- past transaction to glean the lessons for how you can avoid the same mistakes, protect yourself or optimize your experience the next time around? Now that's what I'm talking about! (Translation: Learning from the past is definitely a worthwhile pursuit.)

So here's the skinny on your friend's REO offer. Her dismaying surprise at the bank's counteroffer, which was far and above the list price, might just save you from losing one or two of your "dream" homes. These days, there is an intense amount of competition among buyers, as first-time homebuyers try to close their deals before the Nov. 30 deadline and as cash-waving investors take advantage of what they see as bargain-basement property pricing.

As the tax credit deadline looms nearer, the competition and number of multiple offers grows more and more intense. The result? Many bank-owned homes are selling over the asking price.
That's probably what happened in your friend's situation. Her competing offerors viewed the list price like I used to view the speed limit: as a suggested minimum, or starting point. The offer prices went way over asking and, frankly, the bank and listing agent did your friend the favor of giving her another shot at it by issuing a counteroffer -- giving her the opportunity to get into the game if she wanted to.

More often, a bank will counter only the top offer or so, or will generically counter all offers asking them to come back with their "highest and best," requiring everyone to take a total shot in the dark about whether it would take an increase of $5,000 or $50,000 (or no increase at all) to get into or retain the top spot.

Know this -- when you are in a multiple-offer situation, you are in a competition. A "good" offer is not enough, because the second- and third-place offers don't get the house. Every house might not be worth going to your extreme top price for, but you need to be aware of the rules of the game.

To fully answer your question, though, it's unfortunate, but not at all unethical for the bank to do what it did in your friend's situation. In fact, as I said, I feel like your friend got better than she would have in the average case, where she'd likely have received nothing more than a rejection.
Why do I think your friend's loss might be your gain? Well, time and time again I've seen buyers ignore their agent's advice to offer more than the asking price for a listed home because they think the fact that it's a buyer's market or that the property is a foreclosure renders an over-asking offer absurd.

Many such buyers lose a couple of homes in this fashion before they get aggressive about offering more than the asking price, while they experience what I call "the market educating them."

In fact, multiple offers and above-asking sales prices are the rule of the day in many areas. Your friend's experience has very likely opened both her and your eyes to these market realities. When it comes time for you to start your own house hunt, ask your agent to brief you on local list-price-to-sale-price ratios, so you can focus your search on homes listed appropriately lower than the maximum price you can spend, empowering you to compete and offer more than the asking price, as necessary.

Aides: Home Buyer Tax Credit Extension Likely

2009-10-09T13:39:00.000-07:00

Extending the First-Time Home Buyer Tax Credit, due to expire at the end of November, is high on the Democratic Congressional to-do list, legislative aides said.

After Wednesday’s meeting with President Obama and House Speaker Nancy Pelosi (D-Calif.), Senate Majority Leader Harry Reid (D-Nev.) released a statement that the government should “continue efforts to strengthen the housing market by extending the home buyer tax credit.”

Mark Zandi, chief economist at Moody’s Economy.com, who is a consultant to Democrats in the administration and Congress, is advocating extending the credit through August and making it available to all home buyers. He said failure to extend the credit just as more foreclosures enter the market will push housing prices down.

Also, on Thursday, the House is expected pass legislation to extend the credit through 2010 for people who have been out of the country in the military, intelligence, or foreign services.

California's rollercoaster ride to end?

2009-10-07T15:41:00.000-07:00

The up-and-down rollercoaster ride that California home sales and prices have been on for the last several years could finally even out in 2010, although the state will continue to have a bifurcated housing market, the California Association of Realtors said today.

The "new normal" for California housing markets -- brisk sales and lean inventory on the low end, coupled with continued roadblocks to closing deals on the high end -- could produce a slight increase in the state's median home price, even as sales cool down a bit, CAR said.

In its 2010 forecast, CAR projects the state's median home price will rise 3.3 percent next year to $280,000, even though sales of existing homes are expected to decrease by 2.3 percent, to 527,500 units.

After double-digit declines in sales in 2006 and 2007 -- followed by double-digit increases in 2008 and 2009 -- CAR sees sales moderating to "a more sustainable pace" in 2010.
During the boom, sales of existing homes peaked at 625,000 in 2004 and 2005, and bottomed out at 346,900 in 2007. The median home price has also been on a rollercoaster ride, peaking at $560,300 in 2007 and falling to a projected $271,000 this year.

"Housing in California has become a tale of two markets," CAR President James Liptak said in a press release. "The low end continues to attract first-time buyers and investors, with a resulting shortage in the number of homes for sale. Sellers at the high end, however, continue to be challenged by the ability of homebuyers to secure financing as well as their concerns about where prices are headed."

CAR expects demand for low-end properties from first-time buyers will continue throughout next year, but it remains to be seen whether discretionary sellers return to the market by the second half of 2010, the group said CAR chief economist Leslie Appleton-Young expects distressed properties will account for nearly one-third of sales next year and that inventory will be "relatively lean" -- under six months of supply in the off-season, and about four months during the peak season.

"Although it appears at this time that lenders are closely monitoring the flow of distressed properties onto the market, there could be an exertion of downward pressure on home prices should a heavier-than-expected wave of foreclosures come to market next year," she said.
"The wild cards for 2010 include foreclosures, loan resets, the labor market, the California budget crisis, and the actions of the federal government," Appleton-Young said.

Like other real estate industry groups, CAR is calling on Congress to not only extend but expand the $8,000 first-time homebuyer tax credit that's scheduled to expire Nov. 30.
Liptak said 2009 presented a unique opportunity for first-time homebuyers, who were helped not only by the tax credit but more affordable home prices and interest rates at near historic lows.

CAR is forecasting that the 30-year fixed-rate mortgage will average 5.6 percent next year, up from 5.2 percent this year, and that rates on one-year adjustable-rate mortgage (ARM) loans will increase to 5.2 percent, up from an average of 4.8 percent this year

Relating Skills to Master

2009-10-02T11:39:00.000-07:00

I am asked from time to time why some do so well in this business and some, well, don’t. There are more than a handful of “secrets” but there are very few that are more important that mastering your relatioanl skills. In fact, there is nothing in this world that pays better, in every realm of life, than relational skill mastery. Here’s a few things to keep in mind as you go through your day.

Don’t just listen to or understand people: Really hear them.
Love and support everyone, but require their best.

Speak in messages, not clichés, opinions, or possibilities.
Communicate fully in the moment.

See faults in people, but accept them.

Be unconditionally constructive.

Fully handle tasks.

Don’t seek credit.

Want the best for people, but don’t be tied to it.

Show people you care.

Be others focused.

Be interested in the conversation at hand.

Appreciate others.

Watch your association.

Be interdevelopmental with people: Not codependent, dependent, or merely interdependent.

Be grateful to and for others, and they feel it.

Cause things to happen, don’t wait for them to happen.

Always add value.

Give the gifts that the other person really wants.

The First Step to Success

2009-10-02T11:21:00.000-07:00

“The first step to success is to stop lying to yourself”
I would dare say that the vast majority of people would consider themselves honest, ethical people. In fact, I was in a room of 500 top producing agents when the speaker asked who in the room felt they had integrity. 98% of the room raised their hands. When asked to lower their hand if they had ever lied to themselves or made a promise, resolution or goal and not kept it all the hands went down.
Our quest for success starts within and to truly address the issues that are getting in the way of our achieving our wildest and most audacious dreams we need to have an honest look at ourselves. Our justification, excuses and reasons are all hindering us. The first step to our success is to face the truth about our situation.
I am not talking about condemnation, guilt or shame - none of those have a place in helping us. But honesty and truth, yes, honesty and truth will allow us to see things for what they are. Once problems and issues are identified our mind has a way of seeking answers that were previously hidden from us. I’m not talking in a meta-physical way, but in a very practical way. Our mind blocks millions of things a day from our 5 senses that it doesn’t feel are relevant. When we face our issues, the possible solutions become relevant and our mind will allow us to see and hear them.
If we want to achieve success, whether it is an increase in income, growth in business or overall life balance, we must first face the truth of where we are and the very real disparity of where we want to go and seek the solutions that will allow us to bridge the gap.
Remember, The first step to success is to stop lying to yourself.

What have you done to change the world today?

2009-09-17T12:06:00.000-07:00

I have a saying that is permanently written on one of the white boards in my office. As the projects come and go, the one saying stays as an overarching reminder.
“What have you done to change the world today?”

I remember I had a professor in college that would ask that simple question of the students as he roamed the campus. I’m not sure how many students over the years were impacted by it. But the first day I ran into him and he launched his signature question, He changed me - forever. That question lives with me, no, it haunts me.

So every day, I attempt to answer the question that stares at me. How have I changed the world today? Most days it in small ways, some days I hit a home run. But every day I attempt to leave my mark on the world around me by sowing into the lives God has chosen to place in my life.

In real estate, we have an incredible honor to deeply touch those we work with. We see people in the depths of despair, stress and worry. We see them in the heights of elation as long held dreams are realized. The one common thing in both circumstances is that we have an opportunity to leave our mark, good or bad, forever. Be purposed in what you do and why you do it - you leave a legacy whether you realize it or not.

2009-09-17T12:05:00.002-07:00

Good Morning,

We like what’s familiar and today is practice for tomorrow.
If you practice worry, fear and anxiety, you’ll get better at them.
Sadly, practicing these rob the present moment of peace and happiness; instead, practice being happy, prosperous and free.
What you focus on increases, so become aware of what you’re thinking. If you should happen to think frightening thoughts, change them for something positive.
An excellent thing to change is gratitude.
When you focus on what you are grateful for, your sense of the fullness and abundance of life will increase. If you catch yourself indulging in worry, fear or anxiety… STOP! And practice gratitude instead.

On Your Team,

Milt

Happy

2009-09-17T12:05:00.001-07:00

Good Morning.

Did I figure it out?

I don't have to be unhappy to change. I can be happy and still change. The only reason I am ever unhappy is because I think I should be.

Today I encourage you to notice that whatever you do when you are unhappy you will do better when you are happy.

I have heard it said that, "Success is not the key to happiness but happiness is the key to success."

What happens when you imagine feeling happy today for no reason at all?

Milt

Thoughts Worth Pondering

2009-09-10T15:30:00.000-07:00

Know how you measure success-
Start living your life by design.

Abandon perfectionism-
Replace perfectionism with pride.

Accept, then perfect, what isn’t perfect-
Acceptance is the first step toward perfection.

Enjoy an absence of personal problems-
Life’s too short for problems of any kind-become a problem-free zone.

Automate the business of your life-
Don’t you have better things to do?

Upgrade your personal and professional network-
People bring you the best opportunities in life.

Seriously invest in a special skill set-
The more you can deliver, the more you can earn.

Have whims worth following-
Perfection occurs as you respond to what tugs at you.

Perfect your self-care-
A perfect life isn’t sustainable without advanced self-care.

Lighten your footprint-
Need less-be more.

Evolve your sources of energy-
Design advanced sources of motivation.

Raise your standards-reduce your expectations-
This raises you above the muck of life into the realm of the perfect.

2009-09-03T09:34:00.001-07:00

8145 Hillsdale Drive, Orange CA

The original owner is selling this two story, four bedroom, three bath home, located on the "view side" of hillsdale, with endless views of Irvine Park and the mountains, miles from the house. The courtyard entry leads to a formal living room with wood floors and fireplace, a formal dinning room, and gentle winding staircase. The open kitchen features a center island, an eating area which overlooks the backyard, and opens to the family room with a wetbar adn fireplace. One of the bedrooms is located downstairs with a full bath. The laundry room leads to a roomy 3 car garage.
Upper level features a dramatic master suite with soaring ceilings, view balcony, private bath with soaking tub/shower, and dual vanities. Two additional bedrooms lead to a bonus/game/upstairs family room, which is perfect for informal enterainment area. Energy saving dual zoned central air and tile roof. The rear yard has bbq island and open fence to natural rollings hills below. Close to toll roads, parks, trails and shopping.

2009-09-01T14:44:00.000-07:00

by Unknown Author

No one can make you serve customers well. That’s because great service is a choice.
Harvey MacKay, tells a wonderful story about a cab driver that proved this point.
He was standing in line for a ride at the airport. When a cab pulled up, the first thing Harvey noticed was that the taxi was polished to a bright shine. Smartly dressed in a white shirt, black tie, and freshly pressed black slacks, the cab driver jumped out and rounded the car to open the back passenger door for Harvey.
He handed me a laminated card and said:
“I’m Wally, your driver. While I’m loading your bags in the trunk I’d like you to read my mission statement.”
Taken aback, Harvey read the card. It said:
“Wally’s Mission Statement: ‘To get my customers to their destination in the quickest, safest and cheapest way possible in a friendly environment.’” This blew Harvey away. Especially when he noticed that the inside of the cab matched the outside. Spotlessly clean!
As he slid behind the wheel, Wally said, “Would you like a cup of coffee? I have a thermos of regular and one of decaf.”
I said jokingly, “No, I’d prefer a soft drink.”
Wally smiled and said, “No problem. I have a cooler up front with regular and diet Coke, water, and orange juice.”
Almost stuttering, Harvey said, “I’ll take a Coke.”
Handing him his drink, Wally said, “If you’d like something to read, I have The Wall Street Journal, Time, Sports Illustrated and USA Today.”
As they were pulling away, Wally handed me another laminated card. “These are the stations I get and the music they play, if you’d like to listen to the radio.”
And as if that weren’t enough, Wally told Harvey that he had the air conditioning on and asked if the temperature was comfortable for him. Then he advised Harvey of the best route to his destination for that time of day. He also let him know that he’d be happy to chat and tell him about some of the sights or, if Harvey preferred, to leave him alone with his own thoughts.
“Tell me, Wally,” Harvey asked the driver, “have you always served customers like this?”
Wally smiled into the rear view mirror. “No, not always. In fact, it’s only been in the last two years. My first five years driving, I spent most of my time complaining like all the rest of the cabbies do. Then I heard the personal growth guru, Wayne Dyer, on the radio one day.
“He had just written a book called ‘You’ll See It When You Believe It.’ Dyer said that ‘if you get up in the morning expecting to have a bad day, you’ll rarely disappoint yourself.’ He said, ‘Stop complaining! Differentiate yourself from your competition. Don’t be a duck. Be an eagle. Ducks quack and complain. Eagles soar above the crowd.’”
“That hit me right between the eyes,” said Wally. “Dyer was really talking about me. I was always quacking and complaining, so I decided to change my attitude and become an eagle. I looked around at the other cabs and their drivers. The cabs were dirty, the drivers were unfriendly, and the customers were unhappy. So I decided to make some changes. I put in a few at a time. When my customers responded well, I did more.”
“I take it that has paid off for you,” Harvey said.
“It sure has,” Wally replied. “My first year as an eagle, I doubled my income from the previous year. This year I’ll probably quadruple it. You were lucky to get me today. I don’t sit at cabstands anymore. My customers call me for appointments on my cell phone or leave a message on my answering machine. If I can’t pick them up myself, I get a reliable cabbie friend to do it and I take a piece of the action.”
Wally was phenomenal. He was running a limo service out of a Yellow Cab. I’ve probably told that story to more than fifty cab drivers over the years, and only two took the idea and ran with it. Whenever I go to their cities, I give them a call. The rest of the drivers quacked like ducks and told me all the reasons they couldn’t do any of what I was suggesting.
Wally the cab driver made a different choice. He decided to stop quacking like ducks and start soaring like eagles.
How about us?
Smile, and the whole world smiles with you … The ball is in our hands!

I have posted this article written by an unknown author because I feel it is important for all of you to understand how I conduct my business.
By Referral Only means that I dedicate 100% of my time delivering world class service to you, my clients. I want you to be so satisfied with my services you feel compelled to refer your friends and family to me not by obligation, but because you truly believe they will benefit. You see, your referrals are the heart of my business.

Milt

July pending home sales rise to 2-year high

2009-09-01T14:41:00.000-07:00

The National Association of Realtors said pending U.S. home sales rose for the sixth straight month and is now 12 percent above the same month last year.

WASHINGTON - A gauge of future U.S. home sales rose more than expected in July to the highest level in over two years as first-time buyers rushed to take advantage of a tax credit that expires this fall.

The report showed the housing market is rebounding faster than expected from its historic bust. Low prices and the looming expiration on Nov. 30 of a first-time homebuyers’ tax credit of up to $8,000 have spurred sales. Prices in much of the country have begun to rise from the depths of the slump.

“The overall trend toward stabilization is undeniable at this point,” wrote Mike Larson, real estate analyst at Weiss Research.

The National Association of Realtors said Tuesday its seasonally adjusted index of sales contracts signed in July for previously occupied homes rose 3.2 percent to 97.6. It was the sixth straight increase, and 12 percent higher the same month last year.

Economists surveyed by Thomson Reuters had expected the index to edge up to only 96.5.
The index of pending home sales indicates how sales completed this month and next will turn out. Typically, there is a one- to two-month lag between a contract and a final deal. But delays in getting mortgages approved and appraisals completed have recently lengthened the time it takes to close a deal in many cases.

Analysts predict sales will drop off when the tax credit expires, or if mortgage rates rise from near-record lows. Foreclosures also continue to rise, and banks are forced to sell those properties at deep discounts, pushing prices down.

A 12 percent jump in sales contracts in the West and a 3 percent increase in the South drove July’s overall increase. Sales fell in the Northeast and Midwest.
The Realtors group projects that around 2 million first-time buyers will take advantage of the credit this year, and says it is spurring 350,000 additional sales that wouldn’t have happened otherwise.

Nationally, home prices in the second quarter posted their first quarterly increase in three years, according to the Standard & Poor’s/Case-Shiller national index released last week. Prices are growing in some parts of the country, but “beware a rise in supply as frustrated would-be sellers see their chance,” wrote Ian Shepherdson, chief U.S. economist at High Frequency Economics.

While home prices are still 30 percent below the mid-2006 peak, their new direction should bring relief to lenders, homeowners and buyers alike.
Falling property values have wiped out $4 trillion in homeowners’ equity, and thousands have walked away from homes that are worth far less than their mortgage balance. But now, with prices stabilizing, many buyers who had been staying out of the market are coming off the sidelines.

Fed Chair Says the Worst Is Over

2009-08-28T14:44:00.000-07:00

Federal Reserve Chair Ben Bernanke said on Friday that he was optimistic the economy is about to take off.

Bernanke acknowledged that credit is still tight, especially for businesses, but he told an audience of bankers, academics, and economists that the worst is over.

"Although we have avoided the worst, difficult challenges still lie ahead," Bernanke said. "We must work together to build on the gains already made to secure a sustained economic recovery."

Bernanke called for stronger regulation of financial rules "to ensure that the enormous costs of the past two years will not be borne again."

Source: The Associated Press, Jeannine Aversa (08/21/2009)

IRS Scrutinizes Mortgage Deductions

2009-08-28T14:43:00.000-07:00

According to published reports, the Internal Revenue Service is more closely examining how taxpayers are reporting mortgage interest deductions.

The IRS is reportedly examining some returns with high deductions for mortgage interest and enforcing obscure rules that most home owners and many accountants could be unfamiliar with.

The calculations are very complex and rely on precise records that some home owners may have trouble producing

Experts advise home buyers who have borrowed more than $1 million in mortgages and home equity loans since 1987, the year deductibility limits were enacted, to consult a tax expert because the newest loan may not be tax deductible.

Source: Investment News Daily, Art Auerbach (08/25/2009)

First-Time Buyer Tax Credit Extension Possible

2009-08-28T14:40:00.000-07:00

Bills to extend the maximum $8,000 tax credit for first-time home buyers, which expires Nov. 30, are pending in both the U.S. House and the Senate.

Sen. Christopher J. Dodd, a Connecticut Democrat and chairman of the Senate Banking, Housing, and Urban Affairs Committee, is co-sponsor of a bill with Georgia Republican Sen. Johnny Isakson that would raise the credit amount to a maximum of $15,000.

Senate Majority Leader Harry M. Reid of Nevada favors an extension of the current credit. He was quoted by the Las Vegas Sun saying, "It's something we can get done."

Odds are that the credit will be extended and broadened to cover all buyers next year, but the chances of the amount increasing aren’t as good, observers say.

Source: Washington Post Writers Group, Kenneth R. Harney (08/22/2009)

10 Cities Leading the Market Recovery

2009-08-07T13:35:00.002-07:00

10 Cities Leading the Market Recovery

Here’s more evidence that housing is turning around. Forbes magazine identified 161 of the country’s largest metro areas where sales activity has increased compared to 2008, and where foreclosure sales as a percentage of total sales, are low.

The magazine considers these markets as on the road to recovery.
1. Miami-Ft. Lauderdale, Fla.
2. Lincoln, Neb.
3. Colorado Springs, Colo.
4. Salem, Ore.
5. San Luis Obispo, Calif.
6. Bremerton, Wash.
7. Denver, Colo.
8. Redding, Calif.
9. Santa Barbara, Calif.
10. San Jose, Calif
.

Fed: Recession Ending, Rates Left Alone

2009-08-07T13:35:00.001-07:00

Fed: Recession Ending, Rates Left Alone

The Federal Reserve ended its policy-making meeting Wednesday with the declaration that the recession is ending and it would move toward more normal policies.

The Fed said, “Economic activity is leveling out.” It added that it expected inflation would remain “subdued for some time.”

The Fed said it will keep the short-term key interest rate near zero, but it will end its program to buy $300 billion worth of Treasury bonds by the end of October. Buying bonds was one of the Fed’s efforts to drive down the cost of home mortgages.

“In a way, it’s more of a thumbs-up than if they had said they were continuing the Treasury-buying,” said Edward McKelvey, an economist at Goldman Sachs. “They’re saying that things are going according to plan, and that the policy is O.K.”

Second Quarter Existing-Home Sales Rise

2009-08-07T13:35:00.000-07:00

Second Quarter Existing-Home Sales Rise Existing-home sales in the second quarter showed healthy gains from the first quarter in the vast majority of states, and price declines have increased affordability in most metro areas, according to the latest survey by the NATIONAL ASSOCIATION OF REALTORS®.
Total state existing-home sales, including single-family and condo properties, rose 3.8 percent to a seasonally adjusted annual rate of 4.76 million units in the second quarter from 4.58 million units in the first quarter. However, they remain 2.9 percent below the 4.90 million-unit pace in the second quarter of 2008.
Thirty-nine states experienced sales increases from the first quarter, and nine states were higher than a year ago; the District of Columbia showed both quarterly and annual rises.

NAR: Gain Appears to Be Sustainable“

With low interest rates, lower home prices, and a first-time buyer tax credit, we’ve been seeing healthy increases in home sales, which are a hopeful sign for the economy,” says Lawrence Yun, NAR chief economist. “There have been sustained sales gains in Arizona, Nevada, and Florida, as well as diverse areas such as Maryland, the District of Columbia, and Nebraska. More recently, we’ve seen strong double-digit gains in Idaho, Utah, New Mexico, Washington, Hawaii, New York, New Jersey, Maine, Vermont, Wisconsin, Indiana, South Dakota, and Montana.”

Yun also explained housing’s impact on the overall economy.

“Given the need for related goods and services, each home sale pumps an additional $63,000 into the economy – that’s how the housing engine traditionally pulls us out of recession. In addition, sales are drawing down inventory and that will help stabilize home values, which in turn will lessen foreclosure pressure and boost credit availability for other sectors of the economy.”

Distressed SalesDuring the second quarter, 129 out of 155 metropolitan statistical areas reported lower median existing single-family home prices in comparison with the second quarter of 2008, while 26 areas had price gains.Distressed sales – foreclosures and short sales – accounted for 36 percent of transactions in the second quarter, which continued to weigh down median home prices because they typically are sold at a 15 to 20 percent discount; first-time buyers accounted for one-third of transactions.

The national median existing single-family price was $174,100, which is 15.6 percent below the second quarter of 2008.

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage declined to a record low 5.03 percent in the second quarter from 5.06 percent in the first quarter; the rate was 6.09 percent in the second quarter of 2008.

NAR President Charles McMillan said there are unique opportunities in the current market.

“Housing affordability is hovering near record highs and there’s a wide selection of homes, but first-time buyers need to move quickly to take advantage of the $8,000 tax credit because they have to finalize the transaction by November 30,” he says. “Various state, local, and nonprofit programs target first-time buyers, and a REALTOR® can help you identify the programs and financing options that are currently available in your area.”States With Largest GainsThe largest sales gain between the first and second quarters were in:

Idaho, up 67.5 percent
Hawaii, up 24.2 percent
New York, up 22.3 percent
Wisconsin, up 21.7 percent
Nebraska, up 20.3 percent

Twelve other states experienced double-digit sales increases from the first quarter. Year over year, California, Minnesota, and Michigan are showing double-digit gains from the second quarter of 2008 but are off from the first quarter of this year.

The largest single-family home price increase in the second quarter was in the Davenport-Moline-Rock Island area of Iowa and Illinois, where the median price of $113,200 rose 30.6 percent from a year ago. Next was the Cumberland area of Maryland and West Virginia at $123,500, up 21.7 percent from the second quarter of 2008, followed by Elmira, N.Y., where the median price increased 11.3 percent to $85,000.

Price Gains and Declines

“The sharpest price declines continue to be concentrated in metros with high levels of foreclosures, including areas in California, Florida, Arizona, and Nevada, where distressed homes comprise many of the transactions,” Yun said.

Median second-quarter metro area single-family home prices ranged from a very affordable $55,700 in the Saginaw-Saginaw Township North area of Michigan to $569,500 in Honolulu.

The second most expensive area in the second quarter was the San Jose-Sunnyvale-Santa Clara area of California, at $500,000, followed by San Francisco-Oakland-Fremont at $472,900.

Other affordable markets include the Youngstown-Warren-Boardman area of Ohio and Pennsylvania at $71,500, and Lansing-East Lansing, Mich., at $81,200.

“Recently sold homes are concentrated in lower price ranges. The median price may not be representative of overall values in a given area because many middle-priced homes are not on the market,” Yun says.

Condo Market

In the condo sector, metro-area condominium and cooperative prices – covering changes in 57 metro areas – showed the national median existing-condo price was $176,900 in the second quarter, down 19.8 percent from the second quarter of 2008. Four metros showed annual increases in the median condo price and 53 areas had declines.The metros with condo price increases were:

Virginia Beach, Va.
Wichita, Kan.
Dallas
Colorado Springs, Colo.

Metro-area median existing-condo prices in the second quarter ranged from $66,400 in Las Vegas-Paradise, Nev., to $405,700 in San Francisco-Oakland-Fremont. The second most expensive reported condo market was Honolulu at $318,400, followed by Boston-Cambridge-Quincy at $277,400.

Other affordable condo markets include the Sacramento-Arden-Arcade-Roseville area of California at $101,200 in the second quarter, and Tucson, Ariz., at $102,500.

Snapshot Across the Country

Regionally, NAR reports the following with existing-home sales:

Northeast: jumped 15 percent in the second quarter to a pace of 797,000 units but are 8.4 percent below a year ago. The median existing single-family home price in the Northeast declined 9.7 percent to $246,000 in the second quarter from the same quarter in 2008.

After Elmira, N.Y., the best gain in the region was in Buffalo-Niagara Falls, N.Y., where the median price of $115,400 rose 6.7 percent from the second quarter of 2008, followed by Syracuse, N.Y., at $124,600, up 0.8 percent.

Midwest: rose 3.2 percent in the second quarter to a pace of 1.06 million but are 5.3 percent below a year ago. The median existing single-family home price in the Midwest was down 8.6 percent to $146,800 in the second quarter from the same period in 2008.

After Davenport-Moline-Rock Island, the next strongest metro price increase in the region was in Bismarck, N.D., where the median price of $157,800 was 3.5 percent higher than a year ago, followed by Springfield, Ill., at $116,200, also up 3.5 percent, and Topeka, Kan., at $113,300, up 2.7 percent.

South: increased 3.9 percent in the second quarter to an annual rate of 1.76 million but are 7.2 percent lower than the second quarter of 2008. The median existing single-family home price in the South was $158,600 in the second quarter, down 10.3 percent from a year earlier.

After the Cumberland region of Maryland and West Virginia, the strongest price increase in the region was in Beaumont-Port Arthur, Texas, with an 11.0 percent gain to $138,600, followed by, Jackson, Miss., at $140,100, up 8.2 percent, and Shreveport-Bossier City, La., at $146,800, up 3.0 percent.

West: declined 2.3 percent in the second quarter to an annual rate of 1.13 million but are 11.8 percent above a year ago. The median existing single-family home price in the West was $212,600 in the second quarter, which is 26.6 percent below the second quarter of 2008.

The best metro price performances in the West were in Kennewick-Richland-Pasco area of Washington, where the median price of $163,900 rose 0.3 percent from a year earlier, and Yakima, Wash., at $162,800, also up 0.3 percent. No other areas covered in the region reported increases.

6 Reasons Why Some Homes Sell and Others Dont!

2009-08-07T13:23:00.000-07:00

6 Reasons Why Some Homes Sell !

Why do some houses sell and others don’t?

There’s no ultimate answer to this question, but Tribune Media Services columnist Ilyce Glink has a theory. Here are her six top reasons properties linger on the market:

Lousy pictures on the Web.

Priced too high for the neighborhood.

Blah interior; ho-hum landscaping.

Little online marketing and hard-to-find MLS listings.

Low commissions. Practitioners make sure their customers see properties that offer a payoff.

Miserable maintenance, including ceiling stains, leaky faucets, and ancient furnaces.

A Winning Attitude

2009-08-06T10:55:00.000-07:00

A WINNING ATTITUDE Winners choose attitudes that produce positive behavior knowing that behavior determines results. They achieve their goals with the confidence that they can and will solve any problem that may arise by turning it into a positive advantage.

Following are some of the attitudes that winners incorporate into their lives:

* Positive Thinking Winners do not worry about what cannot be done. They instead focus on what can be done and have detailed plans for overcoming obstacles.

* Committed Winners commit to success from the start. They make a definite choice and commit themselves to following it. They do not try a course of action for a few weeks with the intention of abandoning it if it turns out to be difficult. They make it work.

* Responsible Winners accept personal responsibility for their actions, acknowledging their mistakes and learning from them.

* Creative Winners develop their creativity, exercise it and trust it.

* Take action Winners put forth the effort, time, creativity and money required to achieve their goals. * Persistent Winners never quit. They choose their goal and pursue it persistently until they succeed.
==>Everybody Knows...
You can't be all things to all people.
You can't do all things at once.
You can't do all things equally well.
You can't do all things better than everyone else.
Your humanity is showing just like everyone else's.

So...
You have to find out who you are and be that.
You have to decide what comes first and do that.
You have to discover your strengths and use them.
You have to learn not to compete with others.
Because no one else is in the contest of "being you."

Then...
You will have learned to accept your own uniqueness.
You will have learned to set priorities and make decisions.
You will have learned to live within your limitations.
You will have learned to give yourself the respect that is due, and you'll be a most vital mortal.

Dare to Believe...
That you are a wonderful person.
That you are a once-in-all history event.
That it's more than a right, it's your duty to be who you are.
That life is not a problem to solve, but a gift to cherish. And you'll be able to stay one up on what used to get you down. ~ Author Unknown

June Sales Show an increase overall

2009-07-31T14:25:00.000-07:00

In this journal entry we have some very exciting statistics that are good for both buyers and sellers. As I work with my clients it is wonderful to be able to say that the rebound has began and Real Estate values and pricing are seeing a definite increase. This is a great time for both buyers and sellers so read the following article from the California Association of Realtors and I hope it is informative for you.

C.A.R. reports June home sales increased 20.1 percent, median home price declined 26.4

Existing, single-family home sales increased 20.1 percent in June to a seasonally adjusted rate of 514,110 on an annualized basis.· The statewide median price of an existing single-family home increased 4.2 percent in June to $274,740, compared with May 2009.· C.A.R.’s Unsold Inventory Index fell to 4.1 months in June, compared with 7.6 months in June 2008.

LOS ANGELES (July 27) – Home sales increased 20.1 percent in June in California compared with the same period a year ago, while the median price of an existing home declined 26.4 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

“Many first-time buyers, especially those who were previously priced out of certain areas, are realizing that tax credits from both the state and federal governments, increased affordability, and low interest rates are creating a prime time to purchase a home,” said C.A.R. President James Liptak. “June marked the 10th consecutive month of positive sales gains, and the fourth month of rising median home prices.“

The statewide median price for existing condos increased for the third consecutive month in June, while sales climbed 27 percent compared with last year," Liptak said. "Both of these trends are indicative of increased interest in condos on the part of first-time and other buyers.”

Closed escrow sales of existing, single-family detached homes in California totaled 514,110 in June at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 20.1 percent from the revised 427,910 sales pace recorded in June 2008. Sales in June 2009 decreased 6 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2009 would be if sales maintained the June pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during June 2009 was $274,740, a 26.4 percent decrease from the revised $373,100 median for June 2008, C.A.R. reported. The June 2009 median price rose 4.2 percent compared with May’s $263,600 median price.

“Shrinking inventory in the lower end of the market is impacting prices, as many distressed properties are receiving multiple bids,” said C.A.R. Chief Economist Leslie Appleton-Young. “The year-to-year price declines are diminishing, and are at the lowest level since March 2008.

“Although another surge of foreclosures is expected later this year, demand remains strong, so the market may be able to absorb more distressed properties without significantly impacting the median price,” said Appleton-Young.

Highlights of C.A.R.’s resale housing figures for June 2009:.

C.A.R.’s Unsold Inventory Index for existing, single-family detached homes in June 2009 was 4.1 months, compared with 7.6 months (revised) for the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate..

Thirty-year fixed-mortgage interest rates averaged 5.42 percent during June 2009, compared with 6.32 percent in June 2008, according to Freddie Mac. Adjustable-mortgage interest rates averaged 4.93 percent in June 2009, compared with 5.15 percent in June 2008..

The median number of days it took to sell a single-family home was 44.3 days in June 2009, compared with 49 days (revised) for the same period a year ago.

Regional MLS sales and price information are contained in the tables that accompany this press release. Regional sales data are not adjusted to account for seasonal factors that can influence home sales. The MLS median price and sales data for detached homes are generated from a survey of more than 90 associations of REALTORS® throughout the state. MLS median price and sales data for condominiums are based on a survey of more than 60 associations. The median price for both detached homes and condominiums represents closed escrow sales.

In a separate report covering more localized statistics generated by C.A.R. and DataQuick Information Systems, 20 of the 376 cities and communities reporting showed an increase in their respective median home prices from a year ago. DataQuick statistics are based on county records data rather than MLS information. DataQuick Information Systems is a subsidiary of Vancouver-based MacDonald Dettwiler and Associates. (The lists are generated for incorporated cities with a minimum of 30 recorded sales in the month.)

Note: Large changes in local median home prices typically indicate both local home price appreciation, and often, large shifts in the composition of housing market activity. Some of the variations in median home prices for June may be exaggerated due to compositional changes in housing demand. The DataQuick tables listing median home prices in California cities and counties are accessible through C.A.R. Online athttp://car.org/economics/historicalprices/2009medianprices/jun09medianprices.

Statewide, the 10 cities with the highest median home prices in California during June 2009 were: Beverly Hills, $1,775,000; Manhattan Beach, $1,475,000; Burlingame, $1,475,000; Los Altos, $1,398,000; Saratoga, $1,375,000; Laguna Beach, $1,265,000; Palo Alto, $1,192,000; Santa Monica, $1,022,000; Cupertino, $1,020,000; Mill Valley, $1,009,000; and Los Gatos, $857,500..

Statewide, the cities with the greatest median home price increases in June 2009 compared with the same period a year ago were: Laguna Hills, 20.6 percent; Diamond Bar, 6.2 percent; Santa Monica, 5.9 percent; Upland, 5.7 percent; Thousand Oaks, 4.7 percent; Placentia, 2.9 percent; Big Bear Lake, 2.5 percent; Lake Forest, 2.4 percent; Walnut, 2.1 percent; and Dana Point, 1.4 percent.

Note: Statewide median home prices and sales data have been revised for April 2008 to May 2009 to reflect updates to San Diego Region data.

Tax credit can be used as additional down payment

2009-07-31T14:22:00.000-07:00

WASHINGTON - Speaking to the National Association of Home Builders Spring Board of Directors Meeting, U.S. Housing and Urban Development Secretary Shaun Donovan today announced that the Federal Housing Administration (FHA) will allow homebuyers to apply the Obama Administration's new $8,000 first-time homebuyer tax credit toward the purchase costs of a FHA-insured home. Donovan said that today's action will help stabilize the nation's housing market by stimulating home sales across the country.
The American Recovery and Reinvestment Act of 2009 offers homebuyers a tax credit of up to $8,000 for purchasing their first home. Families can only access this credit after filing their tax returns with the IRS. Today's announcement details FHA's rules allowing state Housing Finance Agencies and certain non-profits to "monetize" up to the full amount of the tax credit (depending on the amount of the mortgage) so that borrowers can immediately apply the funds toward their down payments. Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5 percent of appraised value or their closing costs, which can help achieve a lower interest rate. To read the FHA's new mortgagee letter, visit HUD's website.
"We believe this is a real win for everyone," said Donovan. "Today, the Obama Administration is taking another important step toward accelerating the recovery of the nation's housing market. Families will now be able to apply their anticipated tax credit toward their home purchase right away. At the same time we are putting safeguards in place to ensure that consumers will be protected from unscrupulous lenders. What we're doing today will not only help these families to purchase their first home but will present an enormous benefit for communities struggling to deal with an oversupply of housing."
Currently, borrowers applying for an FHA-insured mortgage are required to make a minimum 3.5 percent downpayment on the purchase of their home. Current law does not permit approved lenders to monetize the tax credit to meet the required 3.5 percent minimum down payment, but, under the terms of today's announcement, lenders can now monetize the tax credit for use as additional down payment, or for other closing costs, which can help achieve a lower interest rate. Buyers financing through state Housing Finance Agencies and certain non-profits will be able to use the tax credit for their downpayments via secondary financing provided by the HFA or non-profit. In addition to the borrower's own cash investment, FHA allows parents, employers and other governmental entities to contribute towards the downpayment. Today's action permits the first-time homebuyer's anticipated tax credit under the Recovery Act to be applied toward the family's home purchase right away. Unlike seller-funded down-payment assistance, which was a vehicle for abuse, this program will allow homebuyers to shop for the best home price and services using their anticipated tax credit.
According to estimates by the National Association of Home Builders, the Administration's homebuyer tax credit will stimulate 160,000 home sales across the nation - 101,000 of which will be first-time buyers who will receive the credit. Another 59,000 existing homeowners will be able to buy another home because a first-time buyer purchased their home. Given FHA's current market share, it's estimated that thousands of families will be able to purchase a home by allowing the anticipated tax credit to be applied toward their purchase together with an FHA-insured mortgage.
Homebuyers should beware of mortgage scams and carefully compare benefits and costs when seeking out tax credit monetization services. Programs will vary from organization to organization and borrowers should consider whether the services make sense for them, as well as what company offers the most suitable and affordable option.
For every FHA borrower who is assisted through the tax credit program, FHA will collect the name and employer identification number of the organization providing the service as well as associated fees and charges. FHA will use this information to track the business closely and will refer any questionable practices to the appropriate regulatory agencies, as necessary.

CONSUMER ALERT*

2009-07-23T14:48:00.000-07:00

California Department of Real Estate ** CONSUMER ALERT ** (Issued 3/2009) 1 FRAUD WARNINGS FOR CALIFORNIA HOMEOWNERS IN FINANCIAL DISTRESS
I. HOME LOAN MODIFICATIONS.
Because of the current economic situation, you may not be able to afford your mortgage payment. If you are also not able to refinance your home loan, an option that may be available to you is a Loan Modification.
What is a Loan Modification? That is where you and your lender agree to modify one or more of the terms of your home loan. The terms could be a lower interest rate, an extension of the length of the loan (like making a 30 year loan into a 40 year loan), a conversion of an adjustable rate loan (called an ARM) to a fixed rate, the deferring of some of your payments, or any other modification of loan terms.
The goal of a Loan Modification is to help you keep your home and to give you a real, meaningful, sustainable, and long-term adjustment to your current home loan that works for your financial situation.
II. BEWARE OF LOAN MODIFICATION SCAMS AND CON ARTISTS, WHO USUALLY DEMAND THE PAYMENT OF UPFRONT FEES.
Just like after a hurricane hits, where unscrupulous contractors and repair people may collect money for repairs and then not do anything, there are numerous rogue and dishonest operators and companies (many of whom are unlicensed) that have appeared in the wake of the current economic downturn -- and more are popping up every day. They make false promises about their abilities to help get you a loan modification, collect money up front, and then do nothing or next to nothing. They are predators who take advantage of those who are or may be vulnerable.
III. THINGS TO DO TO PROTECT YOURSELF FROM BECOMING A LOAN MODIFICATION OR FORECLOSURE RESCUE SCAM VICTIM.
A. Do It Yourself (and Do It As Soon As Possible) -- You can contact your mortgage servicer and/or lender directly and request a Loan Modification that works for you and your lender. Don’t wait to call if you cannot make or believe you will not be able to make your mortgage payments. Be persistent! - call back many times. Make detailed notes about your attempts to call, when you have left messages, who you speak with, what was said, and what offers are discussed and/or made.
B. Other Free and Safe Options -- If you don’t believe you can negotiate a Loan Modification yourself, or if you do not want to, there are free and safe options available to you. (Issued 3/2009) 2
1. The U.S. Department of Housing and Urban Development ("HUD") offers Foreclosure Avoidance Counseling through non-profit agencies in California. Go to HUD’s web site at www.hud.gov, or call 800-569-4287, to find counselors. HUD also offers information to homeowners facing the loss of their home.
2. HOPE NOW Alliance - this is a cooperative effort of home loan counselors and lenders, and it consists of HUD intermediaries. Go to the HOPE NOW web site at www.hopenow.com or call 888-995-HOPE.
C. Locate and Work with a Legitimate, Licensed, and Qualified person or company ("Log on, Look em up, and Check em out") -
1. California licensed real estate brokers can perform loan modification work, and licensed real estate salespersons can do such work under the supervision of their employing broker.
While it is legal for a real estate broker to charge you in advance of performing the loan modification services before a Notice of Default is recorded, you do not have to pay anything in advance of a successful loan modification, and all broker fees are negotiable. If a real estate broker wishes to charge an advance fee, he or she must submit an Advance Fee Agreement and all supporting materials to the Department of Real Estate ("DRE"). If the agreement and materials meet the requirements under the law, DRE issues a no-objection letter. All fees collected in advance must be properly handled as trust funds, which require special handling and must be deposited into the broker’s trust account. A licensee must refund to you any unearned portion of the advance fee(s) collected if any of the promised services are not completed.
But please understand that a no-objection letter does not mean that DRE recommends, approves or endorses the agreement or the services of the real estate licensee. You should go to DRE’s web site at www.dre.ca.gov, review and check the information on advance fees and loan modification services, carefully review the public license information on the real estate broker (that information will include any disciplinary history), and look for any Desist and Refrain Orders (D&Rs) that have been issued against companies and individuals. If a D&R has been issued, that means that DRE has determined the individual and/or company is unlicensed and/or has operated unlawfully.
2. California licensed lawyers can also perform loan modification work, but only when such lawyers render those loan modification services in the course and scope of their practice as an attorney at law.
Lawyers can also charge fees in advance (typically called a retainer), and even after a Notice of Default has been recorded. But lawyers must have a written fee agreement with you. And as is the case with real estate licensees, you do not have to pay anything in advance of a successful loan modification, and all legal fees are negotiable. Any fees that you pay to the lawyer(s) in advance do not have to be placed in their trust accounts. (Issued 3/2009) 3
Just as you should do with real estate licensees, check out lawyers by going to the website of the California State Bar, www.calbar.ca.gov. Check the lawyer‘s bar membership records and look for any discipline.
Unfortunately, some loan modification business models have claimed lawyer involvement but they are just unlawful schemes to avoid the prohibition against the collection of advance fees by a real estate licensee after a Notice of Default is recorded. In others, lawyers are just a "front" or non-participating "magnet" for business from desperate homeowners.
****Be on Guard and Check Them Out -- Do Your Own Homework**** In addition to looking at the license records, contact the Better Business Bureau to see if they have received any complaints about the person or company. But please understand that this is just another resource for you to check, and the loan modification provider might be so new that the Better Business Bureau may have little or nothing on them (or something positive because of insufficient public input).
Also, and very importantly, ask the loan modification "specialists" (whether they are real estate licensees or lawyers) about their financial, mortgage and real estate experience, the options and methods they use to renegotiate home loans, when they were first licensed, whether their license is still active, whether they have ever been disciplined, where they got their experience, and also ask them to define a loan modification and the process that they will undertake and the time that they will spend to negotiate a long-term, affordable and sustainable modification for you.
D. Signals of Fraud/Red Flags to Watch Out For --
1. Demand for payment up front (advance fee payment). While not unlawful if paid to licensed persons in the certain limited situations discussed above, the demand or request for advance payment should alert you to the possibility of fraud.
2. Promises or guarantees of success, such as "We Can Save Your Home. We Have Saved Thousands. Free Consultation. Money Back Guarantee". No such guarantees are possible, and there are no assurances of a successful loan modification.
3. Too good to be true testimonials, such as "We Modified Terri G’s Adjustable Rate Loan, Which Had Spiked to 8 Percent, to a 3.5 Percent Fixed Rate Loan".
4. Claims that a loan modification company is attorney-backed, attorney-affiliated, or attorney-based -- especially where no lawyer or law firm is identified or mentioned. Many of these entities are simply using the name of an attorney (the name might be for show only, and/or there might not even be a lawyer involved) and scams skirting the law. (Issued 3/2009) 4
5. Claims that a loan modifier is operating under a California Finance Lender‘s (CFL) license issued by the California Department of Corporations. This is not lawful according to the Commissioner of the Department of Corporations.
6. A request that you grant a "power of attorney" to the loan modifier. The scammer may use the power of attorney to sell the home right out from under you.
7. A request that you transfer title to your home to the loan modifier or some third party. This is likely evidence of a scam where these scam artists will strip all of the remaining equity in your home.
8. Promises that you can repair your credit history by the payment of rent to the loan modifier or some third party.
9. Lease/rent-back scams, where you are told to transfer title to a third party, rent the home from that party, and then buy it back later. Transferring your deed gives the con artists the ability to evict you and sell the home.
10. Instructions to pay someone or some company other than your home loan lender or servicer.
11. Claims that a loan modification company will file a bankruptcy or other frivolous case for you to "force" a lender to negotiate a loan modification. So-called "forensic loan reviews" may fall into this category.
12. Assertions by the so-called loan modifier that you should just sign documents that they have filled out, without reviewing them first. You must carefully read and understand all of the documents you sign. Be especially wary of promises by salespeople that they will "take care of everything" and you just need to sign "a bunch of forms with boring legalese".
13. Lawyers or real estate licensees who tell you that they have no time to meet with you face-to-face.
14. Unlicensed people or companies.
15. Instructions from a loan modification provider that you should not contact your home loan lender or servicer, a lawyer, an accountant, or a non-profit housing counselor.
16. Being advised to miss payments in order to improve your chances of getting a loan modification.
17. High-pressure sales tactics or warnings that "you must act today" or "tomorrow may be too late". (Issued 3/2009) 5
It is impossible to list all of the Red Flags that might suggest fraud, since the scammers and con artists continue to modify and refine their stories, pitches and cons. They are ruthless and clever. Please be alert, be skeptical, and do your own homework.
And remember, Don’t Rush! You are always able to "slow down" or "pause", and you should tell the provider of loan modification services that you want to check out their license status with the DRE or the California State Bar. Any service provider who objects to that request may have something to hide, like no credentials or license (or bogus credentials) – so be wary!!! Log on, Look em up, and Check em out!!! www.dre.ca.gov..
IV. WHAT YOU CAN DO IF YOU HAVE BEEN SCAMMED (OR BECOME AWARE OF A LOAN MODIFICATION SCAM)? REPORT FRAUD AND FILE COMPLAINTS WITH --
1. The DRE if a real estate licensee is involved, or if the person or company is unlicensed. If the person or company is unlicensed, the DRE will file a Desist and Refrain Order. If the person or company is licensed, the DRE will commence disciplinary action, http://www.dre.ca.gov/cons_complaint.html.
2. The District Attorney, Sheriff, local police and local prosecutor in your community.
3. The California Attorney General, at www.ag.ca.gov/consumers/general.php.
4. The California State Bar if a lawyer is involved, or if an unlicensed person claims to be a lawyer at www.calbar.ca.gov.
5. The California Department of Corporations, at www.corp.ca.gov, if a loan modification claims to be operating under a California Finance Lender License.
6. The Federal Trade Commission, at www.ftc.gov. They have an excellent fact sheet on Foreclosure Rescue Scams.
7. Federal Bureau of Investigation (FBI), at www.fbi.gov.
8. HUD, at www.hud.gov.
9. The Federal Deposit Insurance Corporation (FDIC), at www.fdic.gov.
10. The Better Business Bureau in your community.
11. The Chamber of Commerce in your community.
12. File a Small Claims Court action. These are informal courts where disputes are resolved quickly and inexpensively by a judge. Since 2008, you can recover up to $7,500 in Small Claims Court. You represent yourself, and can request a judgment for money damages. If (Issued 3/2009) 6
your judgment is based on fraud, misrepresentation, or deceit, or conversion of trust funds, and the judgment is against a real estate licensee, DRE has a Recovery Fund that may be able to pay your claim. Go to the DRE web site at www.dre.ca.gov, and look under the tab for "Consumers". Also, the California Secretary of State has a "Victims of Corporate Fraud Compensation Fund" that provides restitution to victims of corporate fraud. Go to the Secretary of State’s web site at www.sos.ca.gov/vcfcf for more information.

Orange County Housing Report

2009-07-20T09:50:00.000-07:00

July 9, 2009
Orange County Housing Report: A Seasonal Summer Drop in Demand
While celebrating the 4th of July and enjoying the warm weather and California surf, demand for Orange County homes dropped by 7%, a typical drop for this time of year. The average drop in demand over the past five years has been 8%. This year is no exception. Demand, the number of new pending sales over the past month, dropped from 3,629 pending sales two weeks ago to 3,359 today, a drop of 270 homes. Last year the drop was 324 homes and demand totaled 2,682 pending sales, 677 fewer than today. Two years ago there were 1,578 fewer pending sales compared to today, totaling only 1,781 for all of Orange County. Over the past five years, demand cyclically increases over the next two weeks, averaging an increase of 4%. The active listing inventory dropped to below the 9,000 mark for the first time since February 2006. The inventory dropped by 242 homes in the past two weeks from 9,188 to 8,946, a 3% drop. From the first of the year, when the active inventory totaled 11,842, the inventory has shed a total of 2,896 homes. Last year the active inventory totaled 14,701 homes, 5,755 additional homes on the market compared to today. Two years ago the active inventory reached 17,334 homes, 8,388 additional homes compared to today. Even though demand dropped, the expected market time did not increase that much because of the drop in inventory. The expected market time increased from 2.53 two weeks ago to 2.66 months today. Most buyers have the expectation of a deep buyer’s market where they can take their time and write an offer to purchase a home well below the asking price. With so much negative news swirling around the economy, the recession, employment and the housing market, it is ironic to find that homes priced below $1 million are experiencing tremendous competition and often sell for at or above the asking price. The lower ranges are incredibly hot too. From $250,000 to $500,000, the hottest price range, the expected market time is 1.44 months. That range represents 24% of the current active inventory and 45% of demand. 55% of the active inventory within that range is either a foreclosure or short sale. Buyers are looking for a deal and are looking for foreclosures. 72% of all distressed sales are found below $500,000. It is reasonable to conclude that distressed sales are fueling the market, especially in the lower ranges. Total pending count, different than demand in that demand tracks new pending sales over the past month only, dropped for the first time this year by 54 homes, now totaling 6,403. Last year at this time the total pending count was at 4,192, 2,211 fewer than today. Two years ago there were 3,797 fewer than today.
The active distressed inventory, both foreclosures and short sales, continued its decent, dropping from 2,919 homes to 2,766, a 153 home drop. Foreclosures make up 13.5% of the distressed inventory. There are only 374 in all of Orange County. The other 86.5% are short sales, totaling 2,392. Foreclosures make up only 4.2% of the TOTAL active inventory and 26.7% are short sales. Foreclosures make up 17.7% of demand and short sales make up 35.4%. With so many buyers looking for a deal, many are turning to foreclosures only to find that there is just way too much demand and competition. They fly off the market as quickly as they come on. The expected market time for foreclosures is only .63 months, between two and three weeks. The expected market time would probably be even less, but it takes a bit of time to sort through multiple offers and communicate with the out of area banks. The number of short sales on the active market has dropped to 2,392, 115 fewer than two weeks ago and 50% off of the peak of 4,810 established in May of 2008. With so few foreclosures on the market, many buyers have turned to short sales where the competition has grown substantially and the expected market time has dropped to 2.01 months. Short sales have become an acceptable alternative to both buyers and lenders alike. Not only have buyers jumped on the short sale bandwagon, but lenders have approved more and more short sales in lieu of the lengthy foreclosure process. One year ago 94% of all distressed listings were at or below $750,000. Today, 88% is found below $750,000, dropping from 89% two weeks ago. The trend is more and more distressed homes are found above the $750,000 mark as the market moves from the subprime fallout
to prime loans. The upper ranges are just beginning to catch up to the lower ranges. We have all read or heard about the foreclosure wave to come. It will not manifest itself in an increase in short sales. When more foreclosures do hit the market, there is so much pent up demand for the foreclosure “deal” that many will become pending sales just as fast as they are placed on the market. The reports from agents on the streets are that they are all working with buyers and they all would love to jump on the next foreclosure to hit the market.

Most Common Seller Mistakes

2009-07-13T12:38:00.000-07:00

With the credit crunch and huge amount of competition from distressed properties, "normal sellers" have had a tough time getting their properties sold. If you must sell in this market, it's absolutely critical that you price your property right.
Pinpointing the best possible price for your home can be a challenge. If you overprice your property in today's market, it can stay on the market for months. If values in your area are declining, the longer you take to sell, the less money you will net. If you want to net the most from your real estate sale, avoid these common seller pitfalls:
1. Basing the list price for your home on the list price of other propertiesThis is probably the most common mistake that sellers make. They look at what other properties are listed for in their neighborhood and base their price on those numbers. This is a huge mistake. To correctly price your property, the only accurate "comparable sales" are those properties that have closed either for all cash or where a lender has funded a loan. While properties may be selling, many are not closing due to the credit crunch. Appraisals are a huge issue. The reason is that a property worth $200,000 today may be worth $196,000 when it closes 60 days later. Appraisers are aware of the issue and often set values more conservatively as a result.
You can obtain comparable sales information online from real estate brokerage sites, Realtor.com and multiple listing service (MLS) Web sites. These online resources are a great starting place. The challenge is that they often lack up-to-date sale and/or price-reduction data. The best source for comparable sales information is a competent local broker who has access to the most up-to-date MLS data.
2. Basing your list price on what you paid for the propertyMany sellers believe that what they paid for the property influences their current sales price. "We paid $200,000 for the property three years ago. We have to sell it for at least $218,000 to break even." This reasoning is based upon a very common fallacy. Many people believe that the agents and the sellers determine the price at which a property will sell.
The truth of the matter is that the real estate market is like the stock market. The buyers -- not the sellers or agents -- determine whether a property is saleable in any given market. For example, if you paid $80 a share for IBM stock and today it's selling for $50 a share, if you wanted to sell for $80 per share, you wouldn't be a seller in today's market. The same is true for your real estate. The price you paid for the property has no bearing on what the buyer will pay. (It does make a difference in terms of your tax liability and a host of other issues.)

3. Overestimating the value of your improvements or upgradesMany sellers have a challenge understanding how the improvements or upgrades that they have made to the property impact value. Some improvements do increase value. Generally these include adding square footage or bringing your property up to the same standards as most other properties in the area. Most improvements, however, make your property more saleable, but they don't necessarily add to the value.
For example, assume that you have white travertine marble countertops throughout your home and distressed walnut floors. These features make your home more attractive to potential buyers, but normally don't add much to your sales price. The reason is that those improvements have no value to a buyer who prefers dark granite and plush carpets. Also, if you overimprove your property by making your home substantially larger than that of your neighbors, you probably won't recoup that money either.
4. Testing the marketSellers often want to "test" the market. "Let's list it at a higher price for a few weeks and see what happens." This is a huge mistake. Real estate professionals know that all listings have a "honeymoon period" where the listing will have the most showings. This normally takes place during the first 30 days the property is on the market. The reason is that buyers who have not yet found a property attempt to see new listings as soon as they come on the market. This initial rush normally drops off after the first 30 days. After that, showings are normally limited to new buyers coming into the market. If you don't sell during the honeymoon period, there's a high probability that your property will be on the market for an extended period of time. You can generate additional interest with a price reduction, but it never creates the attention you receive when you first list the property.
To get the most from your real estate sale, avoid these costly mistakes. If you need more help on how to price your listing correctly, Please contact me anytime 714-743-0888

Multiple offers making a comeback

2009-07-01T14:54:00.000-07:00

In the current home sale market, it might seem ludicrous to make an offer on a listing if it means competing with another buyer. However, multiple offers are on the rise in some markets. But, it doesn't always mean that you need to pay a lot more than the asking price.Sellers are ever hopeful of receiving multiple offers. These days, this is usually an unrealistic expectation. That is, unless the listing is a prime property in a high-demand neighborhood where few homes are being offered for sale.

Price is a critical part of the equation. Some sellers price their homes low because they need a quick sale. If the price is below market, multiple buyers could step forward with offers. Sometimes an overpriced listing is reduced to market price or below and results in offers from more than one buyer.

Most multiple offers today are on low-end foreclosure properties. Investors make up a large part of the buyers in this segment of the market. In some areas of California and Florida, prices have fallen 40 percent since the market peaked in 2006.

HOUSE HUNTING TIP: Don't shy away from making an offer just because there is more than one offer. In some cases, a dozen or more buyers make offers on foreclosure properties that are listed at bargain prices. But, the highest bidder is not always the winner.

Even in non-distressed-sale situations, multiple offers in today's market don't always result in an overinflated sale price. For instance, a charming older home on a sought-after street in the Crocker Highlands neighborhood of Oakland, Calif., sold after only two weeks on the market with multiple offers. The property was listed for $1.3 million, and sold for $5,000 above that price.

There are far fewer financially qualified buyers in the home-buying market today than there were two years ago due to credit tightening, more rigorous financial qualification requirements and recent stock market losses. In some areas, as many as one-third of home sale transactions fail to close, often due to the inability of buyers to obtain the financing they need.

Sellers who receive more than one offer should carefully consider all aspects of the offers, not merely the offer price. An offer from an all-cash buyer who doesn't need a mortgage to finance the purchase, and who can close quickly, should be taken seriously even if the price is lower than the other offer(s). However, some all-cash buyers -- who are fully aware of their strong position in this market -- feel they are entitled to a major price discount.

Whether or not you'll have success countering for a higher price will depend a lot on the profile of the buyer. Buyers who intend to occupy the property for the long term are more likely to pay more than will investors who base their purchase decisions on the numbers, not their emotions.

THE CLOSING: Sellers should try to keep greed out of their decision when faced with multiple offers. Today's buyers are willing to walk away from a negotiation rather than pay over market value, or it they think the sellers are unreasonable.

Dian Hymer is a nationally syndicated real estate columnist and author.

I Don't Know

2009-06-25T13:19:00.000-07:00

Yesterday I found myself in a conversation with Curt, saying to myself as he was talking, "I know, I know."

After the conversation I felt uneasy and somewhat empty.

I got quiet, cleared my mind, and asked the wiser part of me what this uneasy feeling was all about.

The immediate insight I got was that when I say to myself or others the words "I know," I cut off the possibilities for something new and wonderful to occur.

Then the insight came to me that a powerful mindset I can have in any situation is "I don't know," because it actually opens me up to new insight and awareness.

In my experience, my life changes when I change my thinking and my thinking changes when I have new insight, and I get new insight when I approach life with the mindset "I don’t know" versus "I know."

Today I choose to imagine getting more curious about what I don’t know.

On Your Team

Milt

Be Specific When You Ask

2009-06-24T15:33:00.000-07:00

The Top 10 Reasons People Move and Refinance

1. Who do you know who is living in an apartment and would love to own a home of their own?

2. Who do you know whose children are moving out and are finding that their home is too big?

3. Who do you know who has a family that is expanding and is ready to move to a bigger home?

4. Who do you know who lives in a neighborhood that is no longer convenient to where they work and would like to sell their home and move to a more convenient location?

5. Who do you know who might also be selling their business – as you have just done – and as a result may be moving?

6. Who do you know who is about to retire and as a result may be moving?

7. Who do you know who may be going through a divorce or has just gone through one and as a result may be selling their home or looking for a new one?

8. Who else do you know who might be changing jobs in your company and need help relocating?

9. Who do you know who might need to consolidate their debt and could use some help deciding if refinancing their home is a good decision?

10. Who do you know who might need equity from their home to remodel/finance college/buy a second home and could benefit from talking to a loan consultant?

So, as you can see, I really enjoy operating a referral based business and I look forward to providing the same world class service that you have come to expect from me.

Please Don't Keep Me a Secret!!!

Qualities of My Clients

2009-06-24T15:19:00.001-07:00

Over the years I have tried to serve my clients with world class service beyond their greatest expectations.

I have made a list of the qualities or behaviors, that make up my ideal client:

1. They are referred to me
2. They allow me and want me to be the expert
3. They trust me
4. They listen openly to my guidance and direction
5. They have complete faith in me
6. They inspire me to do my best work for them
7. They value my time and never question my intentions
8. They love paying me
9. They believe that I always do my homework
10. They want to introduce me to the people they love

Stimulus Bill 2009 - Will it Work for Real Estate?

2009-06-24T15:16:00.000-07:00

In February, President Obama and Congress passed the massive $787 Billion Stimulus Plan, which contained some rather interesting provisions that impact the real estate space.
The principal provision designed to stimulate new sales was the First Time Homebuyer Tax Credit. If a first time home buyer (or someone who has not owned a home in 3 years) purchases between 01/01/09 and 11/30/09 they will be eligible for a tax credit of up to $8,000 when they file their taxes, and depending on the timing of the purchase the credit can be applied to either 2008 or 2009 taxes. Also, unlike an earlier, weaker $7500 provision passed in 2008, this credit doesn’t need to be paid back.
Other important factors included in the Housing Market section of the Stimulus Bill were:• The FHA, Fannie Mae, and Freddie Mac 2008 loan limits were put back into place for 2009. At the end of 2008, they lowered the loan limits which hurt the higher end market.• It also includes a 30% tax credit on Energy Efficient upgrades to your home (up from 10%) such as furnaces, windows, and insulation. This credit will be available through 2010 and does include income restrictions.
So, the big question in everyone’s mind is “will this help, and does it go far enough?”
Speaking for myself, I just bought my first home a few days ago. I was already planning to buy, so the stimulus bill didn’t really get me off the fence or anything, but it did factor in slightly in terms of my overall price ceiling and/or how willing I was to take on a house that required some immediate improvements (and cash) sunk into it.
We’re running a poll with our Z57 clients asking them to gauge the impact of the bill – right now it’s running about 40% for “No Impact”, 44% say “Some Impact”, and the remaining 16% saying it will have a “Major Impact”.

I tend to slide into the “some impact” group myself – WHAT DO YOU THINK?

27 Books I Have Read or Listened To In The Last 90 Days

2009-06-24T12:23:00.000-07:00

1. Rules of thumb (Alan M. Webber)
2. Excuses Begone! (Wayne W. Dyer)
3. Buying In: Dialogue Between What We Buy and Who We Are (Rob Walker)
4. The Five Most Important Questions (Peter F. Drucker)
5. Crash Proof: How to Profit from the Coming Collapse (Peter D. Schiff)
6. Megatrends 2010 (Patricia Aburdene)
7. The Think Big Manifesto (Michael Port, Mina Samuels)
8. The Science of being Great (Wallace D. Wattles)
9. The Three Laws of Performance (Steve Zaffron, Dave Logan)
10. 17 Lies that Are Holding You Back (Steve Chandler)
11. A Simple Formula for Extraordinary Relationships (Robin Sharma)
12. Handling Fear (Marianne Williamson)
13. How the Mighty Fall (Jim Collins)
14. The Three Marriages (David Whyte)
15. A Whole New Mind (Daniel Pink)
16. Predictably Irrational (Dan Ariely)
17. Scientific Advertising (Claude C. Hopkins)
18. Theatre of the Imagination (Clarissa Pinkola Estes, Ph.D.)
19. Born to Run (Christopher McDougall)
20. The Five Laws That Determine All of Life's Outcomes (Brett Harward)
21. Jung: A Very Short Introduction (Anthony Stevens)
22. The Answer (John Assraff)
23. The Road Less Traveled: A New Psychology of Love (Scott Peck M.D.)
24. Tao Te Ching: A New English Version (Lao Tzu, Stephen Mitchell)
25. Who's Got Your Back (Keith Ferrazzi)
26. The Power of an Hour (Dave Lakhani)
27. Change Your Thoughts, Change Your Life (Dr. Wayne W. Dyer)

Total Experience Scoreboard

2009-06-19T14:05:00.000-07:00

Magic Words
There are two parts to every transaction – the product and the process.
Do you have a favorite restaurant?…Do they have good food?…How’s the service?…
Well, the food is the product and the service is the process. You like (their restaurant) because they have good food and good service.
Let me ask, do they advertise much?…
They probably don’t have to because good food and good service are usually advertised by word of mouth.
Well, that’s how I like to advertise my business – by word of mouth through your referrals. In order to ask you for referrals, I have to be able to help you buy/sell/borrow and I have to make it an enjoyable experience.
This is a graph I use to check to see how well I am doing; I call it ...
The Total Experience Scoreboard
If we can’t help you find your dream home/get the best offer for your home/deliver the best loan, and we don’t troubleshoot the turbulence we encounter, you will be dissatisfied with both the product and the process. You will never do business with us again and you certainly won’t refer others. In fact, you may tell others to avoid working with us.
Have you ever had a problem with service you’ve received?…How many others did you tell about that bad experience?…
At the next level, I may do an “OK” job for you. Maybe we find a home/get an offer/choose a loan, but it’s not your ideal. Maybe we solve problems along the way but don’t deliver beyond your expectations. You’ll be satisfied with the product and the process but not thrilled. You may even do business with us again but you probably won’t introduce me to others.
Our goal is to score at the highest level. When we exceed your expectations with the process and you are delighted with the product, you will be an advocate for us. That is how our company works – we want to be more than just a salesperson doing this deal, we want to be your consultants for life.
When we deliver at that level, we find that clients are eager to refer us because world-class service can be hard to find these days. Are you comfortable with that?

High-end sales boost home prices

2009-06-19T13:22:00.000-07:00

A pickup in sales of homes financed by jumbo loans in May helped boost median home prices in the San Francisco Bay Area and the "Southland" region surrounding San Diego and Los Angeles, MDA DataQuick reported.
In the nine-county San Francisco Bay Area, the median home price was up 12.3 percent from April to May, to $341,500, DataQuick said -- an 18 percent increase from the low of $290,000 seen in March.
The jump was attributed to an increase in sales of homes financed by "jumbo" mortgages above $417,000. Sales of homes requiring jumbo mortgages accounted for 25.5 percent of the Bay Area's home sales in May, the highest since October.
Two years ago, sales of homes financed by jumbo mortgages accounted for more than 60 percent of sales in the region, and the median home price was $665,000, DataQuick said.
Sales of $800,000-plus existing single-family houses accounted for 13.2 percent of all resales in May, up from 9.8 percent in April and also a high not seen since OctoberThe number of existing homes sold in the San Francisco Bay Area increased for the ninth month in a row, to 7,447, a 19.8 percent increase from the record low seen a year ago.In Southern California, the median home price in the six-county Southland area increased by 0.8 percent from April to May, to $249,000 -- the frist increase since July 2007, DataQuick said.
A total of 20,775 new and resale houses and condos closed escrow in San Diego, Orange, Los Angeles, Ventura, Riverside and San Bernardino counties in May, up 1.3 percent from April and the 11th consecutive month of sales growth. Homes priced $500,000 and higher made up 17 percent of sales, up from 15.2 percent in April and the largest share since last October, when those homes represented 19.9 percent of sales.About 12 percent of home sales in the Southland region during May were financed with jumbo loans, compared with 40 percent before the credit crunch hit. Jumbo loans became more expensive and harder to obtain in August 2007, when the secondary market for mortgage-backed securities not guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae dried up.

This is why Median Home Prices are not the way to judge the Residential real estate Market.
When the Market is (in happier days) in a cyclical upswing - it sounds good to watch the Median Home Price rise. Most of the various price levels are all rising and the more high end sales, the better the lower priced buyers feel about their purchases, as the Median Home Prices rise sharply. It's phoney but is a "feel good" scale.
When the Cycle is in a downturn - the Median Home Price is NOT reflective of the actual Market, by any means. This can be the really bad time for such an indicator scale.
Example: Maybe there are a lot of post foreclosure sales and the high end sales are stagnant. There's a low Median Home Price for the area. Now, a little later, say the post foreclosure sales prices are still dropping, but there's a flurry of high end sales, with buyers not necessarily affected by the downturn. Suddenly the Median Home Price reflects the few high end sales, and rises sharply - falsely signalling an upswing in the Market as a whole.
This can bring on a flurry of buyers that had been waiting in the wings, into the lower valued property range - only to find in a few months, those new purchases were not at "the bottom" of the price scale, and there are some "sorry" new home owners out there, watching their new purchase home values drop.

If you would like to discuss this with us please call 714-743-0888 or email mgalbraith@socal.rr.com

The Law of Attraction

2009-06-19T11:29:00.001-07:00

We don't attract what we want, we attract who we are.... today who you?
Today I choose kind, wise, prosperous, generous, open and willing.
Who are you today?

The Galbraith Team
Ricci Realty

Can "School Days" Be "Good Investment" Days?

2009-06-17T11:47:00.000-07:00

Dear Friend,

Here’s a quick note to let you know how I can help you or anyone you feel comfortable introducing me to.

As fall approaches, kids are getting ready to head off to college — and many parents are wondering how they’re going to pay for it. To save the expenses of dorm living, some parents purchase a property near the college campus as a residence for their child. Two or three roommates’ rent covers the monthly payment, and the property becomes a valuable investment for the parents.

The next time you’re in a conversation with a friend, family member or neighbor and they mention their child is going off to college, if they’re interested in saving money and investing for their future, would you stop, take out your cell phone, look up my number 714-743-0888 and call me immediately? I’ll send you my free report to give them: How to Buy a House with Little (or No) Money Down.

Milt Galbraith
714-743-0888
mgalbraith@socal.rr.com
http://www.orangelovelyhomes.com

P.S. People with young children should be thinking “college costs,” too — this report will benefit them as well.

OC Homes by Milt

Why 2011 May Be the End of the Housing Crash

Stand-Alone Home Prices Move Above $500,000 Mark

A Little-Known Loan Program for Fixer-Uppers

California median price rebounds 30% | Inman News

Foreclosure Counselors: What They Can and Can't Do

Website Resources for Foreclosure Help

Foreclosure Help: 5 Pros You Need on Your Team

Facing Foreclosure: What to Do Right Now

Avoid Foreclosure Rescue Scams

http://www.realtor.org/RMODaily.nsf/pages/News2010090702?OpenDocument

California, FHA offer 4% loans | Inman News

http://www.realtor.org/RMODaily.nsf/pages/News2010090302?OpenDocument

High interest rates got you burning like a bratwurst at a Labor Day Barbeque?

http://www.realtor.org/rmodaily.nsf/pages/News2010082401?OpenDocument

FHA premium changes pushed to Oct. 4 | Inman News

Calif.’s first-time buyer tax credit almost gone | time, eight, almost - Business - The Orange County Register

Mortgage Rates Drop to Lowest Level of the Year

The housing recovery is just around the corner

Real estate bottom reached in some California markets? | Inman News

How foreclosure impacts your credit score

Home sales rise more than expected

Low Rates Likely Through 2010

Pending Home Sales Show Healthy Gain

Is now a good time to buy a home?

Earthquake Safety Tips

State of the California Housing Market Report

Get off the Nails in Your Life.

Bright Spots in California

California median price rises in January

10 Home Features Buyers Want

HUD moratorium on FHA 90-day anti-flipping rule

New rules for FHA borrowers

Having a “can do” attitude

Happy New Year?

Small Projects, Big Bang

Useful Work Phrases

Buying a Home in Time to Get Credit

"USA Today" Survey shows spike in first-time home buyers

Predictions on Future Mortgage Rates

Tax Credit Quandaries Answered

Rates on 30-year mortgages remain below 5 percent

Extension and expansion of federal tax credit

Your Personal Mission Statement

The First Step is Always the Same

Double-digit mortgage rates on horizon?

The new REO reality: above-asking offers

Aides: Home Buyer Tax Credit Extension Likely

California's rollercoaster ride to end?

Relating Skills to Master

The First Step to Success

What have you done to change the world today?

Happy

Thoughts Worth Pondering

July pending home sales rise to 2-year high

Fed Chair Says the Worst Is Over

IRS Scrutinizes Mortgage Deductions

First-Time Buyer Tax Credit Extension Possible

10 Cities Leading the Market Recovery

Fed: Recession Ending, Rates Left Alone

Second Quarter Existing-Home Sales Rise

6 Reasons Why Some Homes Sell and Others Dont!

A Winning Attitude

June Sales Show an increase overall

Tax credit can be used as additional down payment

****CONSUMER ALERT*****

Orange County Housing Report

Most Common Seller Mistakes

Multiple offers making a comeback

I Don't Know

Be Specific When You Ask

Qualities of My Clients

Stimulus Bill 2009 - Will it Work for Real Estate?

27 Books I Have Read or Listened To In The Last 90 Days

Total Experience Scoreboard

High-end sales boost home prices

The Law of Attraction

Can "School Days" Be "Good Investment" Days?

CONSUMER ALERT*