Real Estate Investing

I have to admit that I didn’t watch the Fowler episode of Wife Swap, but now I’m intrigued.  I think I’m fairly glad to have missed it after reading the scoop from The Front Steps:

Two million nine hundred twenty five thousand dollars could certainly buy a lot of home elsewhere. Hollywood? Not so sure. Missouri with all the “uneducated, overweight, dumb rednecks”? …uhhhhh yeah.

From Bigger Pockets, we have a link to Where Housing Will be in 2012 by Business Week.

2012 my seem like a long way off, but 28 months isn’t that far away. This Business Week article is a couple months old and it predicts a couple more down years followed by a return to normalization.

Real estate outlook: The recession is over from Realty Times.

One reason for the pick-up in consumer spending: People feel more confident about the direction of the economy in the months ahead. They see the stock market up, so their retirement funds and 401 K plans are bouncing back.

They see home values stabilizing or growing in most areas, so their equity is beginning to increase again.

The one big negative — and it’s definitely a drag for housing — is the unemployment rate, which Mr. Bernanke said won’t be coming down fast, even with the end of the recession.

Real estate sales are up!  What Do August Home Sales Numbers Really Mean? by CNBC.

New construction makes up 6.7 percent of total homes for sale. Existing, therefore, makes up 93.3 percent.

Inventories continue to come down for both new and existing, and there’s your bright spot.

Have a great weekend!

If you want in on the $8000 tax credit for first time home buyers, time is running out for qualified buyers - you can’t have owned a home in the past three years, there’s a $75,000 income limit for singles, $150,000 for couples, and you still have to be able to buy (qualify for home loan with good income, good credit score).  The home must close on or before November 30, 2009.  Over 1.4 million people have taken advantage of the tax credit, according to CNN.com.   While the government has sweetened home buying for some, the deadline is part of what is helping build the success.

Paul Henderson, a Realtor from Lacey, Washington, is ready for the tax credit to end OR to extend it to more than just first time buyers.  He posts on his Active Rain blog site,

All this talk about extending the $8000 tax credit makes my skin crawl. Every time I see this on TV my phone quits ringing. Extending, does take the urgency out of the program which will make the true fence sitters extremely happy. Why make a decision today, when you can wait 6 months?

We’re finding in my own area that the inventory for affordable first time homes is getting low.  I have at least two buyers now looking for houses under $100,000 - there would’ve been about 30 to choose from two months ago, but now we have about ten … and these are the ones that are run down and just a hot mess.  The time urgency is definitely having an impact here.

Meanwhile the National Association of Realtors is lobbying to extend the $8000 credit and not just to FIRST TIME buyers.  They want to see a home credit go to ALL buyers.  However, the tax credit is not a magic bullet. Carla Muss-Jacobs, a broker in Beaverton, Oregon, says the credit can hurt her negotiation position,

How does the $8000 tax credit hurt my deals? First, sellers KNOW about the BUYER credit . . . it’s NOT a secret.  And since the sellers know this, they’re not very willing to: reduce their list price, or offer concessions.  WHY?  Because they know there’s $8,000 on the table from the government, so why cut a deal and give the buyers ANOTHER $5,000 for closing costs, for example?

All interesting, valid points.  What do you think?  Should the program end? Should it be extended?  Expanded?  We’ll know in the next couple of months!

Ordinarily I’d be doing a happy feet dance with all the good news about real estate right now.  But honestly I’m just feeling battered from this last year and don’t want to get my hopes up - only to be dashed after the summer surge and things slow again.  My one big hope is that it’s not just positive housing numbers, but other news about the stock market and talking heads talking about being at the bottom and the climb up beginning.  Let’s take a look:

Home Prices Show Signs of Stabilizing in May - from MSNBC.com

Analysis: Housing Begins Long, Slow Rebound - from MSNBC.com

A staggering $4 trillion in home equity was wiped out, and millions of Americans lost their homes through foreclosure.  Now take a deep breath and exhale. The worst is over.

Stocks Kick Off August with a Rally - from CNN.com

How to Get a Fair Home Appraisal - from CNN.com (I link to this because it’s nice to see something that contains information other than “home values are falling!”)

And then this from Yahoo News about why we shouldn’t be so bullish about the economy…

“Everyone is So Bullish”: Why Peter Boockvar is Still Bearish on America.