My New Blog

     It's been a year since my last post primarilly because of the time demands working with banks and financial institutions in marketing their properties, but I still make time for calls and emails.

     2009 was a good year fueled by the 1st time home buyer tax credit and investors jumping back in. As someone who looks at values and trends on a daily basis I can say that housing under $100K have found their bottom and in some areas seen an increase in value. With historic low interest rates and government incentives along with depressed values makes this an ideal time to buy.

     The staff and myself are looking forward to an even better 2010 as the economy makes it's rebound.

     Greetings on the other side. Whew! I'll bet all of you out there are glad 2008 is behind us. I know I hope 2009 is the start of an upswing for more than the chosen few in the business. On the plus side for buyers it's still a good market to purchase a nice house for a good price and a better interest rate than last year. Also the USRDA 102% loan program is still availiable in select areas. Call me for details.

     For my handful of faithful readers I hope you all have a great year.

     These days, cash is king. Those that have get the great deals. Future Donald Trumps are snapping up the best out there while at the lower levels hardworking families are squeezed by stricter standards and large down payments. Once upon a time everyone needed 20% down (or a parental "gift"), a steady income backed up by tax returns. Credit scores were mostly unheard of and credit sources were car loans and utilities. This isn't a wistful nostalgia trip to the 50's but 1979 when I bought my first house. Back then I paid $23K for a 2 bed 1 bath near Cape Cod. Todays young couples need up to $20K just to buy a starter home unless using a government program like FHA, VA, USRDA, or SHIP.

     With the new government rescue plan look to more use of these programs for years to come.

     It's been a while since the last post but that's what happens when you're busy. As I predicted over a year ago the market for the most part has hit the bottom. Sellers and banks are willing to deal to get property sold, and sales are up for the first time in 3 years. There are many willing and able buyers out there looking for deals. Yes, credit is tighter but no more so than it was 10 years ago.

     The biggest activity is in the under $150K market for 1st time buyers using FHA lending. Unfortunately the programs that allowed sellers to gift money through outfits like Ameridream will no longer be allowed as part of the FHA reform bill that passed congress and signed by the President. They don't want a repeat of 100% financing with no equity to lose that made it easy for people to walk away from their houses.

     Enjoy Labor Day!

     It's an interesting time in the real estate market right now. In the last 12 weeks prices have come down to 2004 levels in a lot of areas either because sellers have finally realized that they aren't going to get top dollar, or foreclosures are driving the market price, or now that the government will forgive the debt on owner occupied housing the short sale isn't a bad idea after all...

     Actually it's all of the above. Good news for those with the credit and cash to buy now because the smart money is predicting long term interest rates to rise to make up for a) the sagging economy, and b) to make up for the heavy losses already incurred. It would be penny wise and pound foolish to try to "time" the bottom when the money will ony cost more.

     Ben Bernacke and co. startled the financial world by dropping 3/4 of a percent for both key rates. It's not that it was unexpected, but shouts volumes as to how bad the perception of the monetary situation really is to do it a week ahead of the monthly meeting. AND you can expect another 1/4 point then too.

     Unilke Vegas, what happens here roils through the world economy since many foreign investors (largely governments) bought the bundled securities.

     What's that mean to you? WELLLLLL, if you have an ARM about to adjust it just won't go as high (and hopefully keep you in the home) and your credit card debt gets a little cheaper. On the flip side, historically 30 year fixed rates generally rise. For those with the cash and credit NOW really is the time to buy.

     Barring a catastrophe, house prices have come down to near bottom, with maybe a few percent left (land and replacement cost can only go so low). For a long term investment the tradeoff of cheaper money outweighs the mental victory of getting a property a few grand less. Of course that's just my opinion.

     This is late in coming but it's been a busy first 2 weeks of the year. I don't know if's in anticipation of the upcoming vote for property tax reform but inquiries and showings from out of area buyers has shot up i the last month. December and January are traditionally slow months for sales but this has been anything but a traditional selling season.

     Interest rates continue to fall based on job growth for December, good news for those who have made a decision on a property. With prices lower for a lot of properties in great areas now is the time to buy. With the Fed probably lowering the overnight rate at their next meeting it will ease the adjustments for those stuck with ARM's (and high credit debt) but can have the opposite effect on long term mortgages. What good is waiting for a rock bottom price if it costs you more to borrow? Where is the victory?

     On a final note, the amendment to save our homes with the portability attachment will, if passed, be the nail to end the subsidy. I for one would like to see real tax reform, scrap the homestead exemption, and shift to broader based taxes and the elimination of rediculous sales tax exemptions. We will no longer be the retirement destination of choice if no one can afford tolive here. The same goes for business that won't invest in manufacturing or any other property intensive industry because of the punitive tax burden. Low wages and no income tax is not an incentive for them. The state and local governments need to realize this. Retirees on fixed incomes won't contribute enough to the system to support high wage jobs. It's time to rethink policy here.

     Well it's that time of year again, Have we been naughty or nice? Thanks to recent sales at least the kids have something under the tree.

     I have noticed an increase in sales activity as sellers (mostly bank owned) have lowered prices to an acceptable level. Buyers on the fence are taking advantage while interest rates are low. Speaking of which, for the astute out there the bond yields are dropping which translates into higher long term interest rates. It also can signal the onset of a recession, something the Fed is trying to avoid. It's a tough ballancing act, and to borrow from Clinton's first run at the White House "It's the economy, stupid". True then and true now.

     What I want in my stocking - wish list: real tax and insurance reform. Stop pandering to multi billion dollar a year profit centers! Abolish the Florida only subsidiaries and require Geico and the like to provide all types of insurance. The other is to eliminate the bogus sales tax exemptions and either eliminate, or at least restore fairness to property taxes. Freezing in time a homes property values is insane. When first enacted into law values were stagnant for many years so it wasn't a big deal, but now... (and yes my taxable value would go up). This state will not attract real businesses to locate here if the cost is too high, period.

     On that note, happy holidays and see you next year.

     Another year without storm activity. Of course the insurance companies consider this to be unusual and want to raise rates " to have enough reserves to cover when the big one comes". Never mind the fact that the state underwrites the reinsurance pool to mitigate losses, or that carriers are retreating from all coastal counties. I want to see either a national catastrophy pool, or the elimination of the Florida only loophole that was created back in the 90's.

     In other words, I'd like to see our duly elected officials grow a pair and do something for the people for a change instead of bowing down to the bigger campaign donators. And while they're at it, reform the sales tax, get rid of the unneccessary exemptions and lower or eliminate the property tax on homesteads. I know I'm far from alone on this issue.

     Enough diatribe, for the people who follow my ramblings, have a merry holiday season!

     Here it is 2 days before thanksgiving and there is much to be thankful about. The family is well and another storm season is almost over without any trouble. Sellers seem to be coming to terms with the reality of the market and buyers who have been waiting on the sidelines are finally making a move.

     Personally I have been recruiting low and moderate income families interested in home ownership to the Volusia County SHIP down payment assistance program. For those that aren't familiar, it is a grant program that gives singles who make up to $40k a grant of $30k toward down payment and closing costs. On a $150k property that would be 20%! As long as you own the home it does not have to be paid back. It's a great deal for the working families who lack the resources to buy without coming up with a huge amount of money.

     For all my peeps out there, have an enjoyable and safe holiday. For the classic and hot rod enthusiasts - see ya at Turkey Run!