(CNNMoney.com) -- Rates on 30-year mortgages were pushed up this week above 6 percent amid growing concerns about inflation, mortgage backer Freddie Mac said Thursday.
Freddie Mac said 30-year fixed-rate mortgages averaged 6.08% with an average of 0.6 points, up from 5.98% last week. Last year at this time, the 30-year loan averaged 6.42%.
"Mortgage rates drifted up this week over market concerns that the Federal Reserve Board may raise short-term rates later this year," said Frank Nothaft, Freddie Mac vice president and chief economist, in a statement.
"Indeed," Nothaft added, "market inflation expectations increased over the last few weeks and the federal funds futures market now has a 25 basis point rate hike priced in by the end of the year."
From www.cnnmoney.com
Thursday, May 29, 2008
Tuesday, May 27, 2008
100% loans for your buyers
HELP IS OUT THERE.
This tough market has seen a huge drop in loans at 100% of the value. Most of these loans were sub prime and we all know those companies are out of business.
But thanks to FHA and VA these loans are still possible. VA allows up to 100% financing along with the seller contributing 6% to the closing costs. FHA allows 97.75% with 6% seller concessions. FHA does allow the remaining 2.25% to come from a non profit organization like the Nehemia program. Total combined loan comes out to that 100%.
There are a few parameters on these loans that you have to be aware of. The first is they are full documentation loans only, borrowers must prove their income, no "stated" (no Income verification) loans. The property must be their primary residence and the need to have 2 years on the job. An important key is credit score is not a factor, so even if the client has fair credit there is a good possibility they will be approved.
There is also the "my community" program which allows 95% in this area. The rates are very good but the client does have to qualify credit wise and they can not make more then $53,000. This program is great for first time home buyers.
We offer all of these programs, so call us for your immediate pre-approval.
This tough market has seen a huge drop in loans at 100% of the value. Most of these loans were sub prime and we all know those companies are out of business.
But thanks to FHA and VA these loans are still possible. VA allows up to 100% financing along with the seller contributing 6% to the closing costs. FHA allows 97.75% with 6% seller concessions. FHA does allow the remaining 2.25% to come from a non profit organization like the Nehemia program. Total combined loan comes out to that 100%.
There are a few parameters on these loans that you have to be aware of. The first is they are full documentation loans only, borrowers must prove their income, no "stated" (no Income verification) loans. The property must be their primary residence and the need to have 2 years on the job. An important key is credit score is not a factor, so even if the client has fair credit there is a good possibility they will be approved.
There is also the "my community" program which allows 95% in this area. The rates are very good but the client does have to qualify credit wise and they can not make more then $53,000. This program is great for first time home buyers.
We offer all of these programs, so call us for your immediate pre-approval.
Friday, May 23, 2008
Existing Home Sales
from The Wall Street Journal
May 23, 2008
Existing-home sales fell for a second month in a row during April, while inventories surged. Home resales fell to a 4.89 million annual rate, a 1.0% decrease from March's revised 4.94 million annual pace, the National Association of Realtors said. The median home price was $202,300 in April, up from $200,100 in March but down 8.0% from $219,900 in April 2007.
For more information, see:
http://online.wsj.com/article/SB121154951554417233.html?mod=djemalertNEW
May 23, 2008
Existing-home sales fell for a second month in a row during April, while inventories surged. Home resales fell to a 4.89 million annual rate, a 1.0% decrease from March's revised 4.94 million annual pace, the National Association of Realtors said. The median home price was $202,300 in April, up from $200,100 in March but down 8.0% from $219,900 in April 2007.
For more information, see:
http://online.wsj.com/article/SB121154951554417233.html?mod=djemalertNEW
Thursday, May 15, 2008
Fresh Ideas for Selling in a Tough Market
I have had many conversations with local Realtors about what they are doing to increase their sales and their exposure to new buyers and sellers. I have listed my favorites.
1) Hold a monthly wine and cheese party that the theme focuses on a different country each month which can be held at your listed homes.
2)Market your listings 24/7 on free sites such as craigslist.org. and Postlets.com. Many agents post their open houses on some of these sites as well.
3)Every service club and Chamber of Commerce on the planet needs speakers. In fact, most Lions, Rotary and Kiwanis clubs need 52 speakers a year. It's an audition for dozens of new customers and yet many clubs struggle to find a speaker each week.
4) Seminars
To reach the powerful baby-boomer segment of buyers and sellers — made up of people 44-62 years old — conduct seminars on topics such as self-directed IRAs, tax implications of real estate sales, and second homes. There are many local professionals that you can partner with that specialize in these topics who would love to have an audience to speak to.
Think outside the box and try every idea you come up with. You will never know what will help your business unless you attempt it. There are no bad ideas and at the very least you are marketing your name.
Quote of the Day,
Setting goals is the first step in turning the invisible into visible.
Tony Robbins
1) Hold a monthly wine and cheese party that the theme focuses on a different country each month which can be held at your listed homes.
2)Market your listings 24/7 on free sites such as craigslist.org. and Postlets.com. Many agents post their open houses on some of these sites as well.
3)Every service club and Chamber of Commerce on the planet needs speakers. In fact, most Lions, Rotary and Kiwanis clubs need 52 speakers a year. It's an audition for dozens of new customers and yet many clubs struggle to find a speaker each week.
4) Seminars
To reach the powerful baby-boomer segment of buyers and sellers — made up of people 44-62 years old — conduct seminars on topics such as self-directed IRAs, tax implications of real estate sales, and second homes. There are many local professionals that you can partner with that specialize in these topics who would love to have an audience to speak to.
Think outside the box and try every idea you come up with. You will never know what will help your business unless you attempt it. There are no bad ideas and at the very least you are marketing your name.
Quote of the Day,
Setting goals is the first step in turning the invisible into visible.
Tony Robbins
Wednesday, May 14, 2008
Why use a realtor?
This is a great article you can show your potential clients.
All real estate licensees are not the same. Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. They proudly display the REALTOR "®" logo on the business card or other marketing and sales literature. REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate. An independent survey reports that 84% of home buyers would use the same REALTOR® again.
Real estate transactions involve one of the biggest financial investments most people experience in their lifetime. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to deal with it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be foolish to consider a deal in real estate without the professional assistance of a REALTOR®.
But if you're still not convinced of the value of a REALTOR®, here are a dozen more reasons to use one:
1. Your REALTOR® can help you determine your buying power -- that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders -- banks and mortgage companies -- offer limited choices.
2. Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.
3. Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of informational resources. REALTORS® can provide local community information on utilities, zoning. schools, etc. There are two things you'll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?
4. Your REALTOR® can help you negotiate. There are myriad negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.
5. Your REALTOR® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your REALTOR®, title company or attorney can help you resolve issues that might cause problems at a later date.
6. Your REALTOR® can help you in understanding different financing options and in identifying qualified lenders.
7. Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.
8. When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.
9. Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property. Your REALTOR® markets your property to other real estate agents and the public. In many markets across the country, over 50% of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. Your REALTOR® acts as the marketing coordinator, disbursing information about your property to other real estate agents through a Multiple Listing Service or other cooperative marketing networks, open houses for agents, etc. The REALTOR® Code of Ethics requires REALTORS® to utilize these cooperative relationships when they benefit their clients.
10. Your REALTOR® will know when, where and how to advertise your property. There is a misconception that advertising sells real estate. The NATIONAL ASSOCIATION OF REALTORS® studies show that 82% of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts. When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.
11. Your REALTOR® can help you objectively evaluate every buyer's proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing -- a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
12. Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, unexpected repairs are required to obtain financing or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).
From www.Realtor.com
All real estate licensees are not the same. Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. They proudly display the REALTOR "®" logo on the business card or other marketing and sales literature. REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate. An independent survey reports that 84% of home buyers would use the same REALTOR® again.
Real estate transactions involve one of the biggest financial investments most people experience in their lifetime. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to deal with it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be foolish to consider a deal in real estate without the professional assistance of a REALTOR®.
But if you're still not convinced of the value of a REALTOR®, here are a dozen more reasons to use one:
1. Your REALTOR® can help you determine your buying power -- that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders -- banks and mortgage companies -- offer limited choices.
2. Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.
3. Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of informational resources. REALTORS® can provide local community information on utilities, zoning. schools, etc. There are two things you'll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?
4. Your REALTOR® can help you negotiate. There are myriad negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.
5. Your REALTOR® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your REALTOR®, title company or attorney can help you resolve issues that might cause problems at a later date.
6. Your REALTOR® can help you in understanding different financing options and in identifying qualified lenders.
7. Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.
8. When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.
9. Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property. Your REALTOR® markets your property to other real estate agents and the public. In many markets across the country, over 50% of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. Your REALTOR® acts as the marketing coordinator, disbursing information about your property to other real estate agents through a Multiple Listing Service or other cooperative marketing networks, open houses for agents, etc. The REALTOR® Code of Ethics requires REALTORS® to utilize these cooperative relationships when they benefit their clients.
10. Your REALTOR® will know when, where and how to advertise your property. There is a misconception that advertising sells real estate. The NATIONAL ASSOCIATION OF REALTORS® studies show that 82% of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts. When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.
11. Your REALTOR® can help you objectively evaluate every buyer's proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing -- a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
12. Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, unexpected repairs are required to obtain financing or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).
From www.Realtor.com
Monday, May 12, 2008
5 New Rules for Home Buyers
(Money Magazine) -- There's no telling how long the housing crisis will drag on. Here's what you need to know before you start shopping in a rocky market.
Rule 1: You can't time the bottom
Rule 1: You can't time the bottom
Face it: The house you buy today will more than likely be worth less next year. That could get you thinking about trying to time the bottom. Resist. It's harder to do than you think, and this is the best buyers have had it in two decades, with inventories up and mortgage rates low.
Pace yourself, find the perfect place and drive a hard bargain: Ignore the seller's asking price and bid 10% below what comparable homes are selling for. If the seller balks, move on. Remember that if you're trading up, your home could sit. So sell before you buy.
Rule 2: One reason to buy now - mortgage rates
Homes are plentiful and will remain so, but financing will be getting more expensive. True, the Federal Reserve has slashed interest rates, but fixed mortgages don't directly follow the Fed. They reflect the bond market's expectations about inflation, which remains a concern. The 30-year, now at 6.1%, will likely reach mid-6% by December and 7% in 2009, says Celia Chen of Moody's Economy.com.
That means there could be a penalty for waiting to buy even if prices fall more. Today a $250,000 loan would set you back $1,500 a month. At 7%, a $1,500 payment gets you only a $225,000 mortgage. As for variable-rate loans, the spread between conforming ARMs and fixed loans is too narrow to do you much good.
Rule 3: Another reason to buy - rates on big mortgages
Mortgages in amounts greater than $417,000 - the limit for buying by federally sponsored mortgage agencies - usually run a fifth of a percentage point above conventional products. But investors are shunning jumbos, which now average 7.2% and are unlikely to drop much this year, according to HSH Associates.
Certain jumbo borrowers could get relief, however. A new law allows Freddie Mac and Fannie Mae to buy loans as large as $729,750 in 71 high-priced areas. So far "jumbo conforming" loans average 6.6%. The program has gotten off to a slow start; you'll need to shop around. And unless Congress acts, this bargain will disappear at year-end.
Rule 4: Don't buy cheap; buy good schools
By now you've heard from somebody who knows somebody who got a great deal on a foreclosed property. But when you buy a house, you're also buying into a neighborhood. And foreclosures tend to be bunched in areas where residents and speculators alike took out exotic mortgages to get into homes they subsequently found they couldn't afford. That's not a recipe for stability. Prices and quality of life could both decline further.
Similarly, avoid developments that popped up in the past few years. They too likely have a lot of owners with risky loans and little equity, says Mike Larson of Weiss Research. Instead, go for areas with highly rated schools. They generally fare better during downturns, and that pattern is holding today, according to a recent study by real estate site Trulia.com.
Rule 5: Make sure your agent has your interest at heart
The real estate game has a built-in conflict of interest, since the listing agent and your agent both get paid by the seller. And these days more sellers are offering extra cash to buyer's agents.
So make sure you're not being steered to a house that's better for your agent than for you. Agree up front on his commission (typically 3%) and that any extra payments will go to you, says Jon Boyd, past president of a buyer's agent trade group.
Latest Economic Indicators
The Existing Home Sales and Median Home Price are based on closings for single family homes, town homes, condominiums, and co-ops. The Pending Home Sales Index is a leading indicator for the housing market based on contracts signed for existing homes.
Existing Home Sales (in millions)
Mar08 4.93
Feb08 5.03
% change -2
Mar07 6.11
Pending Home Sales Index
Feb08 84.6
Jan08 86.2
%change -1.9
Feb07 107.6
Median Home Price
Mar08 $200,700
Mar07 $217,400
%change -7.7
Existing Home Sales (in millions)
Mar08 4.93
Feb08 5.03
% change -2
Mar07 6.11
Pending Home Sales Index
Feb08 84.6
Jan08 86.2
%change -1.9
Feb07 107.6
Median Home Price
Mar08 $200,700
Mar07 $217,400
%change -7.7
Friday, May 9, 2008
The Value of Successful Home Staging
Have you ever walked into a beautifully decorated model home and been captivated by it? Did you find yourself dreaming of bathing in that spa-like bathroom, cooking meals in the gourmet kitchen or curling up with a book in that luxurious reading nook? If so, then you have been the successful target of the secret weapon called staging.
As a real estate agent, you know that staging your real estate listings will result in a faster and more profitable sale, but who can you trust to manage this important process for you.
You want the best possible price for your home, but do not want to pay more than your return to achieve this. You need expert and objective home staging guidance that comes from experience and a highly trained eye in order to compete in a buyers market. What you seek is the experience of an Accredited Staging ProfessionalTM (ASPTM).
Staging can entail simple tasks like removing clutter. Clutter eats equity. Stagers aren't maids or house-cleaners; they don't do repairs or paint. Rather they create a neutral, harmonious, spacious, and beautiful environment. They often set tables for dinner so that a prospective buyer can envision themselves in the property having a family dinner.
Think of staging like detailing a car. A smart auto seller would detail a car before selling it to add value. That's precisely what staging can do for a house. As a REALTOR®, I think that staging helps; it makes the property stand out. In turn, good staging can determine which properties sell fast and which do not. It is no longer a market where staging helps the property sell for more. In today's market, it enables the property to have more potential of selling at all. It's a buyer's market, so make your home stand out by creating a sophisticated ambiance.
While some sellers may be hesitant to spend more money on staging in a down market, this is the winning way to get a property sold; and often for a higher asking price.
Professional stagers can see your house as buyers will, and they'll set the scene so that buyers can imagine living there. They're likely to simplify or streamline the furniture in a room for better traffic flow and to enhance its spaciousness. They may neutralize a too-personal color scheme or add touches of color or accessories where needed. In vacant homes that feel cold and lack visual landmarks, stagers often bring in rental furniture to create warmth. This helps Buyers mentally move in and feel that when it's time for them to move in, thy will be able to kick back and relax.
REALTORS® and sellers can hire stagers by the hour or the room. Homeowners typically pay from $200 to $3,000 depending on the level of service required. But the pay-off in time saved and higher sales price can be nice. If all your listings looked like model homes, do you think you'd have an easier time selling them? And do you think they might command a higher selling price? Statistics show this to be true.
Buying a house is largely an emotional decision because people are not just purchasing a home; they are buying a dream ... a lifestyle. If you can help them with their vision so they don't have to rely completely on their imagination, you positively impact how they feel in the home, which will be reflected in the sales price and number of offers you receive. All human beings want comfort, excitement, prestige and love, and all these are at work in the psychology of the home purchase. Effective staging maximizes those feelings, creating an atmosphere that makes people want to linger and imagine themselves living in the space. Ultimately, staging creates a home the prospective buyer will not be able to live without.
People today have busy lives, they want to walk in and look at a home and say, "This is mine. I can move into this home without doing anything."
by Debra Allen
Realty Times
As a real estate agent, you know that staging your real estate listings will result in a faster and more profitable sale, but who can you trust to manage this important process for you.
You want the best possible price for your home, but do not want to pay more than your return to achieve this. You need expert and objective home staging guidance that comes from experience and a highly trained eye in order to compete in a buyers market. What you seek is the experience of an Accredited Staging ProfessionalTM (ASPTM).
Staging can entail simple tasks like removing clutter. Clutter eats equity. Stagers aren't maids or house-cleaners; they don't do repairs or paint. Rather they create a neutral, harmonious, spacious, and beautiful environment. They often set tables for dinner so that a prospective buyer can envision themselves in the property having a family dinner.
Think of staging like detailing a car. A smart auto seller would detail a car before selling it to add value. That's precisely what staging can do for a house. As a REALTOR®, I think that staging helps; it makes the property stand out. In turn, good staging can determine which properties sell fast and which do not. It is no longer a market where staging helps the property sell for more. In today's market, it enables the property to have more potential of selling at all. It's a buyer's market, so make your home stand out by creating a sophisticated ambiance.
While some sellers may be hesitant to spend more money on staging in a down market, this is the winning way to get a property sold; and often for a higher asking price.
Professional stagers can see your house as buyers will, and they'll set the scene so that buyers can imagine living there. They're likely to simplify or streamline the furniture in a room for better traffic flow and to enhance its spaciousness. They may neutralize a too-personal color scheme or add touches of color or accessories where needed. In vacant homes that feel cold and lack visual landmarks, stagers often bring in rental furniture to create warmth. This helps Buyers mentally move in and feel that when it's time for them to move in, thy will be able to kick back and relax.
REALTORS® and sellers can hire stagers by the hour or the room. Homeowners typically pay from $200 to $3,000 depending on the level of service required. But the pay-off in time saved and higher sales price can be nice. If all your listings looked like model homes, do you think you'd have an easier time selling them? And do you think they might command a higher selling price? Statistics show this to be true.
Buying a house is largely an emotional decision because people are not just purchasing a home; they are buying a dream ... a lifestyle. If you can help them with their vision so they don't have to rely completely on their imagination, you positively impact how they feel in the home, which will be reflected in the sales price and number of offers you receive. All human beings want comfort, excitement, prestige and love, and all these are at work in the psychology of the home purchase. Effective staging maximizes those feelings, creating an atmosphere that makes people want to linger and imagine themselves living in the space. Ultimately, staging creates a home the prospective buyer will not be able to live without.
People today have busy lives, they want to walk in and look at a home and say, "This is mine. I can move into this home without doing anything."
by Debra Allen
Realty Times
Weekly Mortgage Rates Remain Virtually Unchanged
Average 30-year Fixed-Rate Mortgage over 52 weeks
Last Week
30 year fixed 6.16%
Last Year
30 Year Fixed 6.06%
"Despite a weak housing market, mortgage rates remained almost unchanged this week based on better-than-expected economic data releases that indicated the economy still has some staying power," said Frank Nothaft, Freddie Mac vice president and chief economist.
"Job losses lessened in April and conditions in both the manufacturing and service industry outperformed market forecasts. Worker productivity also rose in the first quarter as increases in labor costs diminished.
"The housing market is still struggling amid falling house prices and stricter lending standards. Coupled with higher delinquency and foreclosure rates, a smaller share of families own their homes this year.
“The national homeownership rate held at 67.8 percent in the first quarter of 2008, down from its recent peak of 69.0 percent in the third quarter of 2006 and was the lowest rate since 67.6 percent in the second quarter of 2002, according to the Census Bureau."
From the mortgage ledger
Last Week
30 year fixed 6.16%
Last Year
30 Year Fixed 6.06%
"Despite a weak housing market, mortgage rates remained almost unchanged this week based on better-than-expected economic data releases that indicated the economy still has some staying power," said Frank Nothaft, Freddie Mac vice president and chief economist.
"Job losses lessened in April and conditions in both the manufacturing and service industry outperformed market forecasts. Worker productivity also rose in the first quarter as increases in labor costs diminished.
"The housing market is still struggling amid falling house prices and stricter lending standards. Coupled with higher delinquency and foreclosure rates, a smaller share of families own their homes this year.
“The national homeownership rate held at 67.8 percent in the first quarter of 2008, down from its recent peak of 69.0 percent in the third quarter of 2006 and was the lowest rate since 67.6 percent in the second quarter of 2002, according to the Census Bureau."
From the mortgage ledger
Thursday, May 8, 2008
An End to the Economy's Nose Dive
Latest Market Update
May 08, 2008 -- 12:00 ET
[BRIEFING.COM] Stocks have traded in relatively choppy fashion for much of the morning as buying lacks conviction. Still, advancing names have a marginal advantage over decliners on the NYSE and in the S&P 500.
Sentiment in the... More
What if they gave a recession and nobody came?
That's the question that government, private economists and all of us at home are going to have to mull this summer, as an unprecedented flood of monetary and fiscal stimuli, and renewed global demand for our agricultural and industrial exports, appear to have yanked the U.S. economy out of a nose dive and landed it for a slow roll on the tarmac with just a few bumps and bruises.
This might not be everyone's idea of a perfect soft landing for an economy that was screaming along at 5% annual growth during the days of easy credit three years ago, but it's also not the crash that bears have been fearing.
One of the nation's top independent economists reported this week that his data show the United States is now on track for at least 1% annualized economic growth through the first half of 2009, with no three-month spans forecast in the red.
That economist, Ed Hyman, one of the few number crunchers to whom portfolio managers actually pay attention, acknowledges that his finding is surprising, considering he alerted clients at the start of the year to go on "high alert" for recession.
Yet the founder and leader of ISI Group in New York called off his alert Wednesday because he believes that improving credit markets, powerful federal policy action and a massive wave of investments from the global glut of commodity money will bolster U.S. corporate and consumer balance sheets enough to allow industry to muddle through at least the next 18 months without serious disruption.
Rebates and rebounds
If things do go better than expected, then you may wish to buy low-price energy stocks to take advantage, as they have the greatest built-in growth prospects. I know this idea flies in the face of the conventional wisdom that you'd want to avoid stocks at times like these, or buy beaten-down retailers and banks, but that just goes to show how topsy-turvy the link between stocks and economic growth is.
Consider that gross domestic product grew at a fast 4% annualized rate in 1994 while the broad market sank 2%. A year later, GDP growth plunged to 2%, but stocks advanced 34%. Weird, but true.
More from MSN Money
I'll give you a list of my top small-capitalization and midcap picks in a moment, but first let's explore what's happening under the surface of this crazy economy.
One big upside surprise could come from a source everyone has already discounted: tax rebates. Hyman thinks the effect may be astounding, lifting disposable income for consumers by 16% quarter over quarter. And there's a little-known nuance in the rebate code that allows for $50 billion in tax savings for corporations from accelerated depreciations, which will also likely go straight to U.S. industrial suppliers such as Emerson Electric (EMR, news, msgs) and Ametek (AME, news, msgs).
The jobs market may be in better shape than most suspect, as well. Hyman looks at household employment, rather than figures from the Bureau of Labor Statistics, every month because household employment better captures the swelling work forces of small business. By this measure, monthly employment increases over the past year have averaged 97,000 and are well up from their low of 3,000 in December.
Meanwhile, the four-week average of unemployment claims is down, while indexes kept by independent companies Automatic Data Processing and Monster both ticked up in April, in defiance of the weakness displayed by the government's data-gathering process.
Today's state of the U.S. economy may not seem apocalyptic, but a slow and steady economic beating could prove disastrous, MSN Money's Jim Jubak says.
Inflation trends may help, too. Despite what you sense from your own life about higher food and energy costs, the main input for inflation is wages, and they are flat at best. Inflation rarely rises at times of economic softness, and though we are hearing a lot about stagflation, a rare condition unlikely to occur while the costs of the biggest things on which we spend money -- homes and cars -- are falling.
Some aggressive companies such as Starbucks (SBUX, news, msgs) and McDonald's (MCD, news, msgs) are even cutting prices selectively in an effort to grow market share. China also remains a deflationary force; Hyman notes that it is stepping up low-cost production of high-tech medical devices such as MRI machines for export.
Meanwhile, the amount of money pouring into the economy from U.S. and overseas corporate investments is staggering. Hyman provided a list of capital investment plans announced just in the past week that includes $8.6 billion by Russian mining giant Uranium Holdings, $1.6 billion by Bristol Myers (BMY, news, msgs), $2 billion by British American Tobacco (BTAFF, news, msgs), $1.7 billion by Stone Energy (SGY, news, msgs) and $1.9 billion by giant German copper smelter Norddeutsche Affinerie (NDEAF, news, msgs).
May 08, 2008 -- 12:00 ET
[BRIEFING.COM] Stocks have traded in relatively choppy fashion for much of the morning as buying lacks conviction. Still, advancing names have a marginal advantage over decliners on the NYSE and in the S&P 500.
Sentiment in the... More
What if they gave a recession and nobody came?
That's the question that government, private economists and all of us at home are going to have to mull this summer, as an unprecedented flood of monetary and fiscal stimuli, and renewed global demand for our agricultural and industrial exports, appear to have yanked the U.S. economy out of a nose dive and landed it for a slow roll on the tarmac with just a few bumps and bruises.
This might not be everyone's idea of a perfect soft landing for an economy that was screaming along at 5% annual growth during the days of easy credit three years ago, but it's also not the crash that bears have been fearing.
One of the nation's top independent economists reported this week that his data show the United States is now on track for at least 1% annualized economic growth through the first half of 2009, with no three-month spans forecast in the red.
That economist, Ed Hyman, one of the few number crunchers to whom portfolio managers actually pay attention, acknowledges that his finding is surprising, considering he alerted clients at the start of the year to go on "high alert" for recession.
Yet the founder and leader of ISI Group in New York called off his alert Wednesday because he believes that improving credit markets, powerful federal policy action and a massive wave of investments from the global glut of commodity money will bolster U.S. corporate and consumer balance sheets enough to allow industry to muddle through at least the next 18 months without serious disruption.
Rebates and rebounds
If things do go better than expected, then you may wish to buy low-price energy stocks to take advantage, as they have the greatest built-in growth prospects. I know this idea flies in the face of the conventional wisdom that you'd want to avoid stocks at times like these, or buy beaten-down retailers and banks, but that just goes to show how topsy-turvy the link between stocks and economic growth is.
Consider that gross domestic product grew at a fast 4% annualized rate in 1994 while the broad market sank 2%. A year later, GDP growth plunged to 2%, but stocks advanced 34%. Weird, but true.
More from MSN Money
I'll give you a list of my top small-capitalization and midcap picks in a moment, but first let's explore what's happening under the surface of this crazy economy.
One big upside surprise could come from a source everyone has already discounted: tax rebates. Hyman thinks the effect may be astounding, lifting disposable income for consumers by 16% quarter over quarter. And there's a little-known nuance in the rebate code that allows for $50 billion in tax savings for corporations from accelerated depreciations, which will also likely go straight to U.S. industrial suppliers such as Emerson Electric (EMR, news, msgs) and Ametek (AME, news, msgs).
The jobs market may be in better shape than most suspect, as well. Hyman looks at household employment, rather than figures from the Bureau of Labor Statistics, every month because household employment better captures the swelling work forces of small business. By this measure, monthly employment increases over the past year have averaged 97,000 and are well up from their low of 3,000 in December.
Meanwhile, the four-week average of unemployment claims is down, while indexes kept by independent companies Automatic Data Processing and Monster both ticked up in April, in defiance of the weakness displayed by the government's data-gathering process.
Today's state of the U.S. economy may not seem apocalyptic, but a slow and steady economic beating could prove disastrous, MSN Money's Jim Jubak says.
Inflation trends may help, too. Despite what you sense from your own life about higher food and energy costs, the main input for inflation is wages, and they are flat at best. Inflation rarely rises at times of economic softness, and though we are hearing a lot about stagflation, a rare condition unlikely to occur while the costs of the biggest things on which we spend money -- homes and cars -- are falling.
Some aggressive companies such as Starbucks (SBUX, news, msgs) and McDonald's (MCD, news, msgs) are even cutting prices selectively in an effort to grow market share. China also remains a deflationary force; Hyman notes that it is stepping up low-cost production of high-tech medical devices such as MRI machines for export.
Meanwhile, the amount of money pouring into the economy from U.S. and overseas corporate investments is staggering. Hyman provided a list of capital investment plans announced just in the past week that includes $8.6 billion by Russian mining giant Uranium Holdings, $1.6 billion by Bristol Myers (BMY, news, msgs), $2 billion by British American Tobacco (BTAFF, news, msgs), $1.7 billion by Stone Energy (SGY, news, msgs) and $1.9 billion by giant German copper smelter Norddeutsche Affinerie (NDEAF, news, msgs).
Wednesday, May 7, 2008
19 Positive Outcomes from this Tough Market
This is a great article from the Realty Times
Twenty Positive Outcomes from This Tough Market
by Walter Sanford
1. If you would start setting up some pro-active seller lead generation systems, you would find that getting listings is easier. Sellers want professionals to sell their homes, and non-professionals seldom make it through a market like this. Sellers look less at discounted real estate services to solve their needs. You will find it takes less energy to capture a good listing. As you increase you personal inventory, you can increase showings, contracts from cooperative agents, buyer phone calls, and more double-end possibilities. I challenge you to start one new seller lead generation system today.
2. You have now found out that it is nice to have something set aside for a rainy day. If buyers who want to steal something and sellers who are no longer happy does not tip you off that the old adage of "Make hay while the sun shines" is not true, I give up!
I challenge you to open up a money market fund at someplace like ING or Fidelity. Have your broker take 10 percent of every commission check and wire it to your account. Even though it sounds scary, you will never miss it! Also, have one of the two companies (or another like them) take $10 to $1,000 out of your account every month. You will not miss it either!
3. I bet this market has proven to you that debt is a drag. Secured debt is alright if the security is making enough money to pay for the debt, but all other kinds of debt is a drag! I challenge you to have a plan of reduction. Implement a plan that entails paying cash for items. Get along longer with what you already have. Stop trying to keep up with the Joneses, because they’re in debt, too! Make pay downs on the balance on a regular basis. Get a board game for the family and figure out to have more fun while spending less. Start with the highest interest rate item first. Negotiate others down.
4. Who needs stuff? I just had dinner last night with 70 year old plus friends. They have lots of stuff. He said, “Every year you are alive, you like stuff less.” I challenge you to learn eBay, take stuff to a local auction, or the re-sale shops. On the items that do not sell, give it to the church or less advantaged. Take the money from the items you do sell, and apply that money to debt or savings account.
5. Discover how much faith can play in your life. If the Lord can give his only begotten Son for your sins, just think how easy it could be for Him to help you achieve your goals? I challenge you to time block some time for church on Sunday morning.
6. It's hard to read the bad news in the press and then hang out with negative people! Start believing that you are a reflection of who you hang out with. REALTORS® will never buy or sell through you so if you hang out with them, they better be uplifting! Get out of the energy-draining relationships. My life never truly turned around until I put all bad and energy-sucking people nicely out of my life. I challenge you not to engage with negativity by filling your time with positives and not returning the calls of the negatives.
7. In tough times, time becomes more valuable. Some of your communication habits have to change. I challenge you urge cooperative agents to leave messages on your voice mail, if it is not your phone answering time. They need to leave a complete message so you can work on the challenge and propose a solution without having to talk to them in person. Many a deal gets put together with effective voice mail messages, never talking to the other person.
Second, when you and your client need information, try a three-way call. Hit the hold, dial the “answer man's” number, and connect all three. It will impress your client, answer further questions, and eliminate telephone tag.
I challenge you to handle the phone better by time-blocking a special two hours a day for return calls, incoming calls, incoming and outgoing E-mails and snail mail. Then I challenge you to start taming the cooperative calls and starting three-way phone calls to handle the challenge immediately.
8. On every bill you pay, I want you to ask, “How do I reduce it, eliminate it, get someone else to pay for it, or a combination?” I challenge you to stop the insanity. The internet took over print years ago. If you are going to do print, it better be creative and contrary to the competition. When everyone else advertises their sellers, why can't you advertise your buyers? If it is not bringing results, try to improve it. If it still has no return, eliminate it. I challenge you to look very carefully at your expenses. Dad said that the fastest way to make more money is to raise your prices and stop spending.
9. Many buyers and sellers have goals that are not being achieved by many REALTORS®. Charge them more if you know how to achieve their goals. This involves asking more questions to better determine their needs. The answers to these questions will determine if they are realistic and motivated enough to participate in a process that is in their own best interest. Next, prepare a listing presentation that meets their core needs.
I challenge you to ask for more commission than the competition is requesting. People are willing to pay for professionals who achieve their goals. If you are one these professionals who achieve goals, ask for more than the “average” agents in your area, but you had better be able to prove you are worth the difference! Now is the time to do it!
10. This market should force you to pay attention to the numbers. How many listings are there compared to 12 and 24 months ago? How long do they take to sell and at what list-to-sale ratio? How does that compare to your list-to-sale ratio? How does that compare to the numbers of the agent that you are about to go up against?
It is all about success. The numbers prove success. People pay for success. People hang out with success. I challenge you to know the numbers that express your market -- your competition’s numbers and your numbers. If they compare well, talk about them in this market and people will take notice.
11. I challenge you to pay more attention to the most profitable aspects of your brokerage business. If there are fewer transactions, it is time to capture the “prime” ones. A double-sided transaction allows a double commission with fewer delays. You know the needs of both parties, and there are less gambits. Maximize their occurrence!
Have a system that turns on the minute you get the listing “go ahead.” As you walk out, take a sign out of your trunk and put it up. Call your assistant or a third-party vendor to get the new listing cards out in twenty-four hours. Delay the publishing of the listing in the MLS for about a week, but please do that as legally and ethically as possible! Contact your database with a quick E-mail about the opportunity. You should also hold the one and only open house that Sunday. Do everything you can do to use the excitement of a new listing to get your own buyer. I challenge you to go back to your most profitable, past transactions and design systems to experience them more often.
12. You are dealing with your old friends. You remember them -- the top people, the survivors, the ones who were around during the last slowdown. The new faces have proven business plans. I challenge you to start leveraging their experience.
One of the best things that I did in my area during the last tough market was to put my “Power Players Group” together. I invited them to my home for a barbeque and proposed that they all send my assistant an E-mail with their number one best buyer and number one best seller, based on fantastic motivation. I wanted them to include with the one person and one property, all the information that I would need to find them the right buyer/seller.
The leads were sent to me on Thursday. I assembled them and sent them out to the members on Friday. If you did not send leads in, you did not get the list. Since it was my idea, my assistant, and my system -- I got a twenty-four hour head start. I put a transaction together every month from that information and so did most of the group. I challenge you to form some strange alliances!
13. A normal market means a normal life. Sellers are only selling if they need to sell. Buyers are only buying if they need to buy and are getting a perceived value. There is no more emotional buying, speculation, and using your home for estate-building by flipping every two years. This means you can work a plan as discussed above. You can time-block your schedule. You can be less responsive to “urgent” and more responsive to “important.”
There are fewer reasons to buy and sell when prices are not going up as fast, going sideways, or down. There are fewer reasons to jump up like a Pop-Tart to handle non-scheduled emergencies. Work the proven plans which produce more listings, make listing presentations, negotiate contracts, and show properties to qualified buyers -- all scheduled in the correct balance every day. 14. You need more marketing time. If a seller thinks that limiting your listing period will motivate you, please explain the opposite is true because of human nature. You, the agent, have to present the resources upfront. You want realistic expectations to pay back your overhead and make a profit. Please sell them on your time-blocked status reports, and go for a listing period that allows extra time for the buyers to go through the excess inventory. In most areas, a year listing is now the goal. I challenge you to get the time you need to make a profit.
15. Get out and see the inventory again. Yeah, I know -- what a waste of time. However, if you have an efficient office tour or a tour put on by the MLS, it is now time to start going on them again. You see, the new listings start leading the trend down, therefore allowing you to pay less attention to the comps and more attention to the listings that are setting the new low prices. When I went on tour in a tough market, the outstanding values were the price setters, not the sales from 6 months ago. If you have to talk to REALTORS®, then maybe say, “Hi” to them on tour. I challenge you to figure out how to efficiently see the new listings in your market area about once a week. Stay away from “Sam Slow’s” listings, because he never gets it right. See what the killers are listing, what they offer, and how they are pricing.
16. There are fewer agents out there. Start wearing a name tag again. Put up one of those stupid magnetic signs on your car. There are fewer agents, even fewer who are not hiding in a bunker. Start showing your bright disposition! When asked “How is real estate going?” you can say “My clients are making a fortune. What are your plans in the next twenty-four months?”
17. You will never be poor again. You see the people having trouble now have never have seen a tough market. They sold for the last ten years. They thought that buyers bugged you to buy and sellers asked you to sell. They thought you did not need down payments or credit ratings. They thought that real estate always goes up. They scoffed when you said, “Be careful.” They actually believed that it was easy to make a six figure income in real estate. They bought their own home with no money down and got an interest only loan. They used the money. They saved on their loan and down payment to buy a great car(s) and beat the Joneses.
The ones who are making it have been through tough times before. Whatever does not kill you, will make you stronger. If you listen to me carefully and do the stuff you should be doing, you will make it! If you make it through this market, you will be set for life, because it does not get much harder than this. I challenge you to prosper now as you set yourself up for life.
18. You will be convinced that buyers are the least profitable segment of market, no matter what market. I challenge you to stop listening to non-agents selling technology that solicits buyers as your main income lead generator.
19. You will get to the point faster. “Either you want to buy or sell, or please call someone else.” You will be able to say that nicely with no one thinking you are full of yourself. I challenge you to start that exercise today.
Twenty Positive Outcomes from This Tough Market
by Walter Sanford
1. If you would start setting up some pro-active seller lead generation systems, you would find that getting listings is easier. Sellers want professionals to sell their homes, and non-professionals seldom make it through a market like this. Sellers look less at discounted real estate services to solve their needs. You will find it takes less energy to capture a good listing. As you increase you personal inventory, you can increase showings, contracts from cooperative agents, buyer phone calls, and more double-end possibilities. I challenge you to start one new seller lead generation system today.
2. You have now found out that it is nice to have something set aside for a rainy day. If buyers who want to steal something and sellers who are no longer happy does not tip you off that the old adage of "Make hay while the sun shines" is not true, I give up!
I challenge you to open up a money market fund at someplace like ING or Fidelity. Have your broker take 10 percent of every commission check and wire it to your account. Even though it sounds scary, you will never miss it! Also, have one of the two companies (or another like them) take $10 to $1,000 out of your account every month. You will not miss it either!
3. I bet this market has proven to you that debt is a drag. Secured debt is alright if the security is making enough money to pay for the debt, but all other kinds of debt is a drag! I challenge you to have a plan of reduction. Implement a plan that entails paying cash for items. Get along longer with what you already have. Stop trying to keep up with the Joneses, because they’re in debt, too! Make pay downs on the balance on a regular basis. Get a board game for the family and figure out to have more fun while spending less. Start with the highest interest rate item first. Negotiate others down.
4. Who needs stuff? I just had dinner last night with 70 year old plus friends. They have lots of stuff. He said, “Every year you are alive, you like stuff less.” I challenge you to learn eBay, take stuff to a local auction, or the re-sale shops. On the items that do not sell, give it to the church or less advantaged. Take the money from the items you do sell, and apply that money to debt or savings account.
5. Discover how much faith can play in your life. If the Lord can give his only begotten Son for your sins, just think how easy it could be for Him to help you achieve your goals? I challenge you to time block some time for church on Sunday morning.
6. It's hard to read the bad news in the press and then hang out with negative people! Start believing that you are a reflection of who you hang out with. REALTORS® will never buy or sell through you so if you hang out with them, they better be uplifting! Get out of the energy-draining relationships. My life never truly turned around until I put all bad and energy-sucking people nicely out of my life. I challenge you not to engage with negativity by filling your time with positives and not returning the calls of the negatives.
7. In tough times, time becomes more valuable. Some of your communication habits have to change. I challenge you urge cooperative agents to leave messages on your voice mail, if it is not your phone answering time. They need to leave a complete message so you can work on the challenge and propose a solution without having to talk to them in person. Many a deal gets put together with effective voice mail messages, never talking to the other person.
Second, when you and your client need information, try a three-way call. Hit the hold, dial the “answer man's” number, and connect all three. It will impress your client, answer further questions, and eliminate telephone tag.
I challenge you to handle the phone better by time-blocking a special two hours a day for return calls, incoming calls, incoming and outgoing E-mails and snail mail. Then I challenge you to start taming the cooperative calls and starting three-way phone calls to handle the challenge immediately.
8. On every bill you pay, I want you to ask, “How do I reduce it, eliminate it, get someone else to pay for it, or a combination?” I challenge you to stop the insanity. The internet took over print years ago. If you are going to do print, it better be creative and contrary to the competition. When everyone else advertises their sellers, why can't you advertise your buyers? If it is not bringing results, try to improve it. If it still has no return, eliminate it. I challenge you to look very carefully at your expenses. Dad said that the fastest way to make more money is to raise your prices and stop spending.
9. Many buyers and sellers have goals that are not being achieved by many REALTORS®. Charge them more if you know how to achieve their goals. This involves asking more questions to better determine their needs. The answers to these questions will determine if they are realistic and motivated enough to participate in a process that is in their own best interest. Next, prepare a listing presentation that meets their core needs.
I challenge you to ask for more commission than the competition is requesting. People are willing to pay for professionals who achieve their goals. If you are one these professionals who achieve goals, ask for more than the “average” agents in your area, but you had better be able to prove you are worth the difference! Now is the time to do it!
10. This market should force you to pay attention to the numbers. How many listings are there compared to 12 and 24 months ago? How long do they take to sell and at what list-to-sale ratio? How does that compare to your list-to-sale ratio? How does that compare to the numbers of the agent that you are about to go up against?
It is all about success. The numbers prove success. People pay for success. People hang out with success. I challenge you to know the numbers that express your market -- your competition’s numbers and your numbers. If they compare well, talk about them in this market and people will take notice.
11. I challenge you to pay more attention to the most profitable aspects of your brokerage business. If there are fewer transactions, it is time to capture the “prime” ones. A double-sided transaction allows a double commission with fewer delays. You know the needs of both parties, and there are less gambits. Maximize their occurrence!
Have a system that turns on the minute you get the listing “go ahead.” As you walk out, take a sign out of your trunk and put it up. Call your assistant or a third-party vendor to get the new listing cards out in twenty-four hours. Delay the publishing of the listing in the MLS for about a week, but please do that as legally and ethically as possible! Contact your database with a quick E-mail about the opportunity. You should also hold the one and only open house that Sunday. Do everything you can do to use the excitement of a new listing to get your own buyer. I challenge you to go back to your most profitable, past transactions and design systems to experience them more often.
12. You are dealing with your old friends. You remember them -- the top people, the survivors, the ones who were around during the last slowdown. The new faces have proven business plans. I challenge you to start leveraging their experience.
One of the best things that I did in my area during the last tough market was to put my “Power Players Group” together. I invited them to my home for a barbeque and proposed that they all send my assistant an E-mail with their number one best buyer and number one best seller, based on fantastic motivation. I wanted them to include with the one person and one property, all the information that I would need to find them the right buyer/seller.
The leads were sent to me on Thursday. I assembled them and sent them out to the members on Friday. If you did not send leads in, you did not get the list. Since it was my idea, my assistant, and my system -- I got a twenty-four hour head start. I put a transaction together every month from that information and so did most of the group. I challenge you to form some strange alliances!
13. A normal market means a normal life. Sellers are only selling if they need to sell. Buyers are only buying if they need to buy and are getting a perceived value. There is no more emotional buying, speculation, and using your home for estate-building by flipping every two years. This means you can work a plan as discussed above. You can time-block your schedule. You can be less responsive to “urgent” and more responsive to “important.”
There are fewer reasons to buy and sell when prices are not going up as fast, going sideways, or down. There are fewer reasons to jump up like a Pop-Tart to handle non-scheduled emergencies. Work the proven plans which produce more listings, make listing presentations, negotiate contracts, and show properties to qualified buyers -- all scheduled in the correct balance every day. 14. You need more marketing time. If a seller thinks that limiting your listing period will motivate you, please explain the opposite is true because of human nature. You, the agent, have to present the resources upfront. You want realistic expectations to pay back your overhead and make a profit. Please sell them on your time-blocked status reports, and go for a listing period that allows extra time for the buyers to go through the excess inventory. In most areas, a year listing is now the goal. I challenge you to get the time you need to make a profit.
15. Get out and see the inventory again. Yeah, I know -- what a waste of time. However, if you have an efficient office tour or a tour put on by the MLS, it is now time to start going on them again. You see, the new listings start leading the trend down, therefore allowing you to pay less attention to the comps and more attention to the listings that are setting the new low prices. When I went on tour in a tough market, the outstanding values were the price setters, not the sales from 6 months ago. If you have to talk to REALTORS®, then maybe say, “Hi” to them on tour. I challenge you to figure out how to efficiently see the new listings in your market area about once a week. Stay away from “Sam Slow’s” listings, because he never gets it right. See what the killers are listing, what they offer, and how they are pricing.
16. There are fewer agents out there. Start wearing a name tag again. Put up one of those stupid magnetic signs on your car. There are fewer agents, even fewer who are not hiding in a bunker. Start showing your bright disposition! When asked “How is real estate going?” you can say “My clients are making a fortune. What are your plans in the next twenty-four months?”
17. You will never be poor again. You see the people having trouble now have never have seen a tough market. They sold for the last ten years. They thought that buyers bugged you to buy and sellers asked you to sell. They thought you did not need down payments or credit ratings. They thought that real estate always goes up. They scoffed when you said, “Be careful.” They actually believed that it was easy to make a six figure income in real estate. They bought their own home with no money down and got an interest only loan. They used the money. They saved on their loan and down payment to buy a great car(s) and beat the Joneses.
The ones who are making it have been through tough times before. Whatever does not kill you, will make you stronger. If you listen to me carefully and do the stuff you should be doing, you will make it! If you make it through this market, you will be set for life, because it does not get much harder than this. I challenge you to prosper now as you set yourself up for life.
18. You will be convinced that buyers are the least profitable segment of market, no matter what market. I challenge you to stop listening to non-agents selling technology that solicits buyers as your main income lead generator.
19. You will get to the point faster. “Either you want to buy or sell, or please call someone else.” You will be able to say that nicely with no one thinking you are full of yourself. I challenge you to start that exercise today.
Tuesday, May 6, 2008
Longer closing times
We have seen much longer closing times from lenders. We all think that since business is down the closing times should be faster, that the lenders should be knocking loans out left and right. The things we all forget are that since the down turn many lenders have greatly reduced their staff and of course guidelines have tightened up significantly.
A big key to delays is the increase in FHA loans. Since "subprime" is gone the number of FHA loans being submitted to lenders has skyrocketed. They can't handle the huge increase with the reduction in staff that has occurred. Also, many brokers who are new to doing FHA loans do not know the guidelines and all of the additional documentation needed to submit these loans properly. This lack of knowledge just increases the delays because underwriters have to sort through these bad files, basically wasting time on loans that should never have been submitted.
The average "approval" time for a submitted FHA loan is approximately 8 days. That means that the loan package sits at the lender for up to 8 days before anyone looks at it. Once the approval has been sent, they are taking upwards of 4 days to clear any outstanding conditions. As you can clearly see that's 12 days of down time. These days are added onto the "normal" closing times.
The way to expedite closing times is to make sure the broker/lender has FHA experience, make sure you know the lenders time frame on approvals, make sure all expectations are communicated up front with the broker/lender and all parties involved.
These delays are based on FHA loans, many conforming non FHA loans are taking much less time to close. If you have a borrower who is putting down 20% on a purchase that loan should close in 2 weeks, as long as no unforseen problems arise. Which we all know never happens.
A big key to delays is the increase in FHA loans. Since "subprime" is gone the number of FHA loans being submitted to lenders has skyrocketed. They can't handle the huge increase with the reduction in staff that has occurred. Also, many brokers who are new to doing FHA loans do not know the guidelines and all of the additional documentation needed to submit these loans properly. This lack of knowledge just increases the delays because underwriters have to sort through these bad files, basically wasting time on loans that should never have been submitted.
The average "approval" time for a submitted FHA loan is approximately 8 days. That means that the loan package sits at the lender for up to 8 days before anyone looks at it. Once the approval has been sent, they are taking upwards of 4 days to clear any outstanding conditions. As you can clearly see that's 12 days of down time. These days are added onto the "normal" closing times.
The way to expedite closing times is to make sure the broker/lender has FHA experience, make sure you know the lenders time frame on approvals, make sure all expectations are communicated up front with the broker/lender and all parties involved.
These delays are based on FHA loans, many conforming non FHA loans are taking much less time to close. If you have a borrower who is putting down 20% on a purchase that loan should close in 2 weeks, as long as no unforseen problems arise. Which we all know never happens.
Subscribe to:
Posts (Atom)
