Wednesday, December 31, 2008

Top 5 Home-Buying Blunders for 2009

A Look At the Real Estate Market's Biggest Pitfalls of the New Year—and How You Can Avoid Them

By Luke Mullins
US News and World Report
Posted December 24, 2008

With cheaper home prices, lower mortgage rates, and big discounts on foreclosures, buyers will have plenty of incentives to get into the real estate market in 2009. But anyone considering purchasing a house next year should proceed with caution. After all, the gloomy outlook for home prices, ongoing financial crisis, and potentially historic recession have created a number of possible pitfalls. In an effort to help buyers navigate the uncertain market, U.S. News recently spoke with some top real estate professionals and compiled a list of 2009's top five home-buying mistakes.

1) Buying for the short term: With home prices at the national level expected to continue declining throughout most of next year at least, 2009 won't be a good time to try to turn a quick buck in the real estate market. Many homes that are purchased in 2009 will lose value in the short term. And although they are likely to recover that value when the market rebounds, it remains unclear just when home prices will bounce back. "If you're not planning on living in that house for more than three to five years, I wouldn't buy anything right now," says Richard Green, director of the Lusk Center for Real Estate at the University of Southern California. "Nobody knows what is going to happen to prices over the next few years." So if you're going to buy real estate in 2009, you're better off buying a home that you plan to live in for a long time, rather than as a short-term investment property.

2) Not understanding what's happening in your local market: Although it's easy to get caught up in the gloomy national housing trends, prospective home-buyers should be paying more attention to what's going on in the market where they are considering purchasing property. After all, home prices in your local market could be moving in the direction opposite to the rest of the country. "Individual markets are not the national market," says Keith Gumbinger of HSH Associates. "[The real estate market] is tremendously individualized." Prospective home-buyers can obtain a solid understanding of the conditions in their market by talking to a real estate professional, reading the local newspaper's real estate section, or finding a good housing blog that covers the area.

3) Not scouring for deals: With the fall in home prices expected to continue for some time, 2009 will be a buyer's market. As such, people considering purchasing a home should understand that they are in the driver's seat and be on the lookout for deals. "It's definitely a buyer's market—there is no doubt about that," says Mark Hanson, a managing director who handles real estate and finance research at the Field Check Group. "Look for deals; go in there and low ball; look at foreclosures." But while haggling is healthy, be careful not to go overboard. Buyers who make insultingly low offers are likely to be considered "bottom feeders" and dismissed by sellers, Gumbinger says.

4 ) Purchasing a foreclosure just because it ' s cheap: While foreclosures can offer home-buyers big discounts, such properties sometimes come with a great deal of baggage. For example, the previous owners could have left the home in poor condition, requiring thousands of dollars of repairs, says Joshua Dorkin, the founder and CEO of, a real estate networking and information site. "A pitfall for 2009 would be buying a foreclosure without knowing what you are getting into," Dorkin says. "Because that great deal may not be so good if you get inside and you find out that the floors are ripped up and the walls are destroyed." Before you decide to go foreclosed-home shopping, do your homework or contact a real estate professional with experience with such transactions.

5 ) Overly aggressive buying: Even if you've found the perfect property, make sure it is something you can reasonably afford. Many economists expect the current recession to be the nastiest in decades, with some projecting the unemployment rate to hit 9 percent. That means that 2009 won't be a good year to try to stretch your finances. "Just because a lender says you qualify for this much of a loan doesn't mean you should buy that much of a house, especially if that is 50 percent of your take-home pay," Hanson says. "What happens if you lose your job? We're going into a period of heavier unemployment, so buy conservatively."

The Top 5 Housing-Market Hopes for 2009

Here Are the Five Best Reasons to Be Hopeful About Housing in 2009:

Luke Mullins
US News and World Report
Thursday December 18, 2008, 11:02 am EST

1. Cheap mortgage rates: With inflationary pressures easing and economic concerns mounting, shell-shocked investors are seeking the protection of government securities, such as 10-year treasury notes, driving down yields. The lower yields, coupled with the Fed's recently announced plans to buy up debt and mortgage-backed securities from Fannie Mae and Freddie Mac have dragged mortgage rates to multi-year lows. Thirty-year, fixed mortgage rates hit an average of 5.47 percent last week, the lowest they've been since 2004, according to Freddie Mac.

To be sure, not everyone will be able to take advantage of these attractive rates: Tougher lending standards will prevent many would-be buyers from getting into the market, while homeowners whose houses are now worth less than what they owe on their mortgage won't be able to refinance. Still, the rates present a welcome incentive for qualified borrowers to step up to the plate. "Lower mortgage rates mean more people with those credentials will be able to qualify," says Patrick Newport, a U.S. economist at IHS Global Insight. While that might not make a dramatic impact on the market, it could be enough to keep home sales from declining as much as they otherwise would, Newport says.

2. Lower prices: Home prices at the national level have already fallen 21 percent from their 2006 peaks. And in certain bubble markets, the crash has been even steeper--prices have fallen more than 30 percent in Phoenix and Las Vegas over the past year alone. Although that's a big blow to homeowners--the housing bust is expected to wipe out more than $2 trillion in home values in 2008--lower prices do help stimulate buyer demand, which is badly needed to mop up the excess housing inventory. And while home prices are expected to drop further in 2009, values in certain markets are already at levels low enough to tempt bargain hunters. "Falling home prices aren't part of the problem, they are part of the solution," says Mike Larson, a real estate analyst at Weiss Research.

3. Fewer housing starts: In the face of dwindling demand, home builders have been forced to sharply pull back on new construction. The government reported Tuesday that November housing starts dropped to their lowest level since 1959, when officials started keeping the statistics. While that's bad news for the economy--because it means fewer jobs for builders and others--it's an important step in bringing housing supply back in line with demand. The cutback will limit the supply of new homes coming into the market, which helps to reduce the glut of unsold homes that is putting such downward pressure on housing prices. "In order to get rid of the inventory, builders have to cut back even further and prices have to drop," Newport says. "It's very painful, but there is no way to get around the fact that that's what you need to do to equilibrate the market."

4. Obama stimulus: In an attempt to hoist the economy out of its rut, President-elect Barack Obama has announced plans for a massive federal spending program. The initiative is expected to put between $500 billion and $1 trillion into infrastructure repair and other projects in an effort to keep Americans working. Should this program succeed in preventing unemployment from skyrocketing and keeping the economic contraction from hitting the dourest projections, certain housing markets may firm up quicker than expected, says Susan Wachter, a professor of real estate at the University of Pennsylvania's Wharton School of Business. In the best-case scenario, "the housing market declines become contained to those markets where house price declines are significant," Wachter says.

5. Credit programs: It will be tough for the housing market to come back to life until the credit markets--which have been log-jammed by fear for more than a year--begin to unlock. Like the fight to limit unemployment, reviving the credit markets is a daunting challenge. But remember, the federal government has already taken a number of steps designed to do just that. The Federal Reserve has slashed its benchmark interest rate to between 0 and 0.25 percent and committed nearly $2 trillion to new lending programs, bailouts, and additional measures designed to bolster the financial markets. Meanwhile, Congress passed a $700 billion bailout and the Treasury has already injected a chunk of that money into banks of all sorts. While these efforts haven't been enough to restore the credit markets to health, they have produced results. Interbank lending, for example, has eased. And should this modest victory lead to a broader recovery in the credit markets, the economy--and the housing demand that comes with growth--could turn around quicker than expected. "Right now, panic is driving the credit markets," says Moody of Mission Residential. "If, for whatever reason, confidence were to resume and people's appetite for risk was starting to increase, then you could start all of a sudden seeing credit flowing much more freely, which obviously supports spending in both business and households."

Tuesday, December 30, 2008

Buyers Market

We Are in a Buyers Market!

Source: Trendgraphix Facts and Trends

While this may have been obvious to you for some time now, there are many indications of a "Buyers Market" that give Realtors clues as to pricing trends which help us to determine negotiating tactics. Quite often, Sellers need to Sell, but Buyers have the luxury of waiting for a "deal". On the other hand, some Sellers do not have a set time frame for making a move or downsizing, giving them the luxury of picking when they choose to put their home on the market. All of these variables are important in terms of evaluating your property's value and developing a marketing strategy to Sell your home.

Months of Inventory

In November, 2008 the months of inventory in Menlo Park were 6.7, while back in May, 2008 it was just 2.5. In Atherton the months of inventory in November, 2008 were 5.5 as opposed to 3.5 in May, 2008. The more inventory, the better, for the perspective Buyer. Conversely, if you need to make a quick Sale to facilitate a move, or your new home purchase is contingent upon the Sale of your previous residence, you may need to price your property more aggressively.

Days on Market

In November, 2008 the average home in Menlo Park was on the market for 52 days vs. just 27 days in May, 2008. In Atherton the average home was on the market for 36 days while in May, 2008 it was on the market just 19 days.

Average Price For Sale vs. Sold

Menlo Park homes in May, 2008 were selling at their asking price, while by November, 2008 they were selling significantly below the asking price. In Atherton the trend was for the homes to Sell below their asking price for the majority of the last 15 months.

Monday, December 29, 2008

Internet Overtakes Newspapers As News Source

Source:The Pew Research Center for the People and the Press

The internet, which emerged this year as a leading source for campaign news, has now surpassed all other media except television as a main source for national and international news.

Currently, 40% say they get most of their news about national and international issues from the internet, up from just 24% in September 2007. For the first time in a Pew survey, more people say they rely mostly on the internet for news than cite newspapers (35%). Television continues to be cited most frequently as a main source for national and international news, at 70%.

For young people, however, the internet now rivals television as a main source of national and international news. Nearly six-in-ten Americans younger than 30 (59%) say they get most of their national and international news online; an identical percentage cites television. In September 2007, twice as many young people said they relied mostly on television for news than mentioned the internet (68% vs. 34%).

The percentage of people younger than 30 citing television as a main news source has declined from 68% in September 2007 to 59% currently. This mirrors a trend seen earlier this year in campaign news consumption. (See "Internet Now Major Source of Campaign News," News Interest Index, Oct. 31, 2008.)

The survey by the Pew Research Center for the People and the Press, conducted Dec. 3-7 among 1,489 adults, finds there has been little change in the individual TV news outlets that people rely on for national and international news. Nearly a quarter of the public (23%) says they get most of their news from CNN, while 17% cite Fox News; smaller shares mention other cable and broadcast outlets.

Sunday, December 28, 2008

Warren Buffet's Predictions for 2009

From the Huffington Post

Warren Buffett became one of the wealthiest people in the world by making predictions and putting money behind those predictions. Every time he buys a stock or a business or some other investment, he's forecasting the future.

Judging by the incredible returns of his holding company Berkshire Hathaway, Buffett and his colleagues are very good at making those predictions.

Of course, it helps when you can give your predictions plenty of time to come true. That's one reason Buffett's favorite holding period for investments in "outstanding businesses with outstanding managements" is "forever." After all, "We don't get paid for activity, just for being right. As to how long we'll wait, we'll wait indefinitely."

With that in mind, here are Warren Buffett Watch's 'timeless' predictions.

1. Recessions can't be avoided forever. As 2007 was coming to a close, Buffett told our Becky Quick that if unemployment picks up significantly, the "dominoes" will fall and the U.S. economy will fall into recession in 2008. He was right, but not alarmed. "It is the nature of capitalism to periodically have recessions. People overshoot." (He told Becky she's young enough to expect to see 6 or 7 or them.)

2. We'll survive current and future recessions just as we've survived past problems. As Buffett told us in August, 2007, (and repeated throughout 2008): "We've got a wonderful economy... There's never been anything like that in the history of the world. We live seven times better than the people did a century ago on average... We've had problems all along. If you look at the last century, we had that Great Depression and World War Two, we had the Cold War, we had the atomic bomb, but the country does well."

3. Recessions will create opportunities. "I made by far the best buys I've ever made in my lifetime in 1974. And that was a time of great pessimism and the oil shock and stagflation and all those sort of things. But stocks were cheap." Fast-forward to October, 2008, and Buffett's Why I'm Buying U.S. Stocks Now.

4. All stocks won't be cheap. Like Ted Williams waiting for the right pitch, a successful investor waits for the right stock at the right price, and it doesn't happen every day. "What’s nice about investing is you don’t have to swing at pitches. You can watch pitches come in one inch above or one inch below your navel, and you don’t have to swing. No umpire is going to call you out." You get in trouble, Buffett says, when you listen to the crowd chanting "Swing, batter, swing!"

5. The crowd will make mistakes. Buffett cites this piece of advice from his mentor Benjamin Graham: "You’re neither right nor wrong because other people agree with you. You’re right because your facts are right and your reasoning is right—and that’s the only thing that makes you right. And if your facts and reasoning are right, you don’t have to worry about anybody else."

6. Investors will mistakenly think falling stock prices are bad. "If they reduce the price of hamburgers at McDonald's today I feel terrific. Now I don't go back and think, gee, I paid a little more yesterday. I think I'm going to be buying them cheaper today. Anything you're going to be buying in the future, you want to have get cheaper."

7. Good times will prompt bad decisions. In his 2000 Letter to Berkshire shareholders, Buffett compared the crowd that buys big when prices are high to Cinderella at the ball. "They know that overstaying the festivities - that is, continuing to speculate in companies that have gigantic valuations relative to the cash they are likely to generate in the future - will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands."

8. There will be more dancing at another wild party followed by another painful hangover. Looking back at the Internet bubble, Buffett is quoted as saying, "The world went mad. What we learn from history is that people don’t learn from history."

Saturday, December 27, 2008

What Do All of Those Real Estate Acronyms in the Ads Mean?

If you find yourself stumbling over weird acronyms in a real estate listing, don't be alarmed. There is method to the madness of this shorthand (which is mostly adopted by sellers to save money in advertising charges). Here are some abbreviations and the meaning of each, taken from a recent newspaper classified section:

* assum. fin. -- assumable financing
* dk -- deck
* gar -- garage (garden is usually abbreviated "gard")
* expansion pot'l -- may be extra space on the lot, or possibly vertical potential for a top floor or room addition. Verify actual potential by checking local zoning restrictions prior to purchase.
* fab pentrm -- fabulous pentroom, a room on top, underneath the roof, that sometimes has views
* FDR -- formal dining room (not the former president)
* frplc, fplc, FP -- fireplace
* grmet kit -- gourmet kitchen
* HDW, HWF, Hdwd -- hardwood floors
* hi ceils -- high ceilings
* In-law potential -- potential for a separate apartment. Sometimes, local zoning codes restrict rentals of such units so be sure the conversion is legal first.
* large E-2 plan -- this is one of several floor plans available in a specific building
* lsd pkg. -- leased parking area, may come with an additional cost
* lo dues -- find out just how low these homeowner's dues are, and in comparison to what?
* nr bst schls -- near the best schools
* pvt -- private
* pwdr rm -- powder room, or half-bath
* upr- upper floor
* vw, vu, vws, vus -- view(s)
* Wow! -- better check this one out.

Copyright © 2008 Inman News

Friday, December 26, 2008

Home-Mortgage Rate Hits Fresh Low, 5.14%

From the Wall Street Journal online By AMY HOAK

Fixed-rate home mortgage rates fell again this week, with the 30-year fixed-rate mortgage setting another record low, at least since Freddie Mac began doing its weekly survey in the early 1970s.

The 30-year averaged 5.14% for the week ended Dec. 24, down from last week's 5.19% average, according to the Freddie Mac survey released Wednesday. It was more than a full percentage point below its 6.17% average a year ago, and hasn't been lower since Freddie started doing its rate survey in 1971.

Fifteen-year fixed-rate mortgages averaged 4.91% this week, down from 4.92% last week and 5.79% a year ago. The mortgage hasn't been lower since April 1, 2004, when it averaged 4.84%.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.49% this week, down from 5.6% last week and 5.9% a year ago. One-year Treasury-indexed ARMs averaged 4.95%, up slightly from 4.94% last week yet still down from 5.53% a year ago.

"Interest rates on 30-year fixed-rate mortgages eased for the eighth straight week" and set a record low since Freddie Mac's survey began in 1971, said Frank Nothaft, Freddie Mac chief economist, in a statement.

"Real GDP growth fell 0.5% in the third quarter of the year, pulled down by the largest drop in consumer spending since the second quarter of 1980. The market consensus calls for an even larger decline in the last three months of the year," he said.

And the housing market continues to contract, Mr. Nothaft added.

To obtain the rates in the weekly survey, the 30-year fixed-rate mortgage required payment of an average 0.8 point, the 15-year fixed-rate mortgage required an average 0.7 point and the ARMs required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.

In a separate survey Wednesday by the Mortgage Bankers Association, mortgage applications were up a seasonally adjusted 48% last week, compared with the week before.

Wednesday, December 24, 2008

Merry Christmas! Here's a yummy appetizer for your Christmas gathering...

Easy Elegant Baked Brie en Croute

One round of Brie 8 – 10”
Sliced Almonds
Marvelous Mango Chutney *
Pepperidge Farm Puff Pastry Sheets

Slice Brie in half horizontally
Spread with a generous amount of Chutney
Sprinkle with sliced almonds
Place other half of Brie on top
Roll out puff pastry until it is uniform
Place Brie face down on pastry dough
Gently pull pastry around and fold to seal (cut off any extra)
Turn it over so that all seams are underneath
Place on cookie sheet

Bake at 325 degrees for 25 minutes or until golden brown
IMPORTANT let it rest about 20 minutes before cutting

Serve with slices of baguette or sturdy crackers

* Marvelous Mango Chutney Recipe see below

Tuesday, December 23, 2008

Happy Holidays!

My Treasured Recipe for Marvelous Mango's a LOT of work, but it's worth it!!!

Barbara’s Marvelous Mango Chutney


1 Box (15 oz.) Raisins
1 Quart (32 oz.) Apple Cider Vinegar
1 Pound (16 oz.) Light Brown Sugar
Spices (Crush Lightly in a plastic bag and tie in a double layer of cheesecloth):
4 Cinnamon Sticks
1 teaspoon Anise Seeds
1 teaspoon Coriander Seeds
1 teaspoon Mustard Seeds
8 Whole Cardamom Pods

The following spices are not in the cheesecloth bag -
¼ teaspoon Mace
¼ teaspoon Cayenne Pepper (for fiery hot, add extra
¼ teaspoon)
2 tablespoons Salt

4 Cloves pressed or minced Garlic
½ pound (1 Cup) diced Crystallized Ginger
(Australian if possible)
½ pound (1 Cup) diced dried Apricots
½ pound sliced Hot Green Peppers

Mild Chutney = 4 oz. Seeded Jalapeno Peppers
Medium-Hot Chutney = 4 oz. Seeded Jalapeno Peppers
+ 4 oz. Serrano Peppers, 2 with seeds
Hot Chutney = 8 oz. Serrano Peppers with Seeds

3 pounds thinly sliced or diced Ripe Mangos (about 10)


Recommended method is to do all prep before starting cooking process -

Put Raisins, Vinegar and Sugar in a pot. Add spices tied in cheesecloth, Mace, Cayenne and Salt. Boil for 15 minutes.

Add Garlic, Ginger, Apricots and Peppers. Lower heat, simmer 30 minutes.

Add the thinly sliced or diced mangos. Simmer an additional 45 minutes, stirring occasionally to prevent scorching, but taking care not to disintegrate the mango slices too much.

Let stand until cool. Fill sterilized, hot jars. Seal and store. One recipe makes 10 jars (1/2 pint).

Coming Down...But Will They Go Lower?


Overnight Averages Today +/-
1 yr jumbo ARM 6.60%
3/1 jumbo ARM 6.07%
3/1 jumbo ARM (interest only) 5.95%
7/1 jumbo ARM 6.08%
7/1 jumbo ARM (interest only) 6.24%
2/28 ARM 6.45%
3/27 ARM 6.47%
40 yr fixed mtg 6.36%
30 yr fixed mtg 5.28%
15 yr fixed mtg 5.23%
1 yr ARM 5.67%
30 yr fixed jumbo mtg 6.97%
30 yr FHA mtg 5.74%
5/1 ARM 5.83%
5/1 jumbo ARM 5.95%
3/1 ARM 5.75%
7/1 ARM 5.99%
10/1 ARM 6.23%
15 yr fixed jumbo mtg 6.42%
10 yr fixed mtg 5.12%
20 yr fixed mtg 5.13%
3/1 ARM (interest only) 5.60%
5/1 ARM (interest only) 5.83%
5/1 jumbo ARM (interest only) 6.13%
7/1 ARM (interest only) 6.01%

Monday, December 22, 2008

Mortgage Activity Surges at US Banks

By Saskia Scholtes in New York

Published: December 22 2008 19:37 | Last updated: December 22 2008 19:37

US banks are having trouble handling a surge of mortgage applications spurred by dramatically lower interest rates, after record loan defaults and thousands of job cuts have stretched mortgage industry resources to the limit.

Applications for home loans more than doubled in the two weeks after the Federal Reserve said it would buy mortgage bonds to help stabilise the market, prompting mortgage rates to fall by more than three-quarters of a percentage point.

In depth: Global financial crisis - Nov-11In depth: US banks - Nov-22In depth: US downturn - Dec-05With average rates for a 30-year, fixed-rate mortgage now at about 5.2 per cent, growing numbers of borrowers have an incentive to refinance to bring down their mortgage costs.

However, tighter underwriting standards for prospective borrowers, combined with funding and staffing difficulties for mortgage originators, are likely to restrict the supply of new mortgages.

“The mortgage industry is collectively unprepared to deal with a cascade of business; staffs were pared to the bone as the market for mortgages shrank over the past year,” analysts at HSH Associates wrote in a note to clients.

Mahesh Swaminathan, mortgage analyst at Credit Suisse, said that as a result, lower rates would not necessarily create a wave of mortgage refinancing on the scale that was seen in 2003, when credit markets were healthy.

“There is a lot of pipeline congestion. Originators don’t have the staffing or the credit lines to fund a lot of loans,” said Mr Swaminathan. “You have more due diligence which requires more staffing. It is not something that can be changed overnight.”

Part of the problem is that banks have directed the bulk of their manpower toward their servicing arms in an attempt to stem the tide of mortgage defaults and foreclosures.

While banks have pledged to use capital they have received from the US Treasury to boost consumer lending, they are also under intense political pressure to modify loan terms for struggling borrowers as a matter of urgency.

Loan modifications have continued to grow more quickly than other strategies such as subsidy programmes or refinancing into government loans, according to the Office of the Comptroller of the Currency.

The number of new loan modifications grew 16 per cent in the third quarter to more than 133,000, said the OCC. The rate of loan modification is likely to be even higher in fourth-quarter data, say analysts, as a result of recent initiatives by Fannie Mae and Freddie Mac, the two large mortgage financiers, as well as private sector loan modification schemes.

However, modified loans can still require substantial servicing resources, as more than 55 per cent of modified loans fall back into default in the first six months, according to the OCC.

Additional reporting by Nicole Bullock in New York
Copyright The Financial Times Limited 2008

Elementary and Middle Schools in Menlo Park & Atherton

Encinal Elementary School
Public · 3-5 · 395 students
195 Encinal Ave.
Atherton, CA 94027
(650) 326-5164
District: Menlo Park City Elementary School District

Hillview Middle School
Public · 6-8 · 659 students
1100 Elder Ave.
Menlo Park, CA 94025
(650) 326-4341
District: Menlo Park City Elementary School District

Laurel Elementary School
Public · K-2 · 487 students
95 Edge Rd.
Atherton, CA 94027
(650) 324-0186
District: Menlo Park City Elementary School District

Oak Knoll Elementary School
Public · K-5 · 715 students
1895 Oak Knoll Ln.
Menlo Park, CA 94025
(650) 854-4433
District: Menlo Park City Elementary School District

Friday, December 19, 2008

Staging Your Home to SELL -- Part 2

Some Specifics

"Curb appeal." They say you can only make one "first impression," and people usually form their first impression within 30 seconds. What potential buyers see when they drive up to your house will be their first impression. This is a good place to spend a little extra time and money. Plant flowers, trim bushes, weed, pick up leaves, repaint your front door, replace tarnished house numbers or a dented mailbox, get a brand-new neutral doormat, park your old car somewhere else.

The entrance. The first glimpse inside your home should give potential buyers positive, uplifting feelings. Make your entryway as light and bright as possible. Leave all the lights in the house on. (Have you noticed that model homes do this?) Get rid of all area rugs. (Even authentic, high-quality carpets should normally be removed since they break up the expanse of floor space, making rooms look smaller.) Limit your cooking to very plain foods so odors don't linger. (No cabbage, garlic, or onions!) On the other hand, freshly baked chocolate chip cookie smells are just fine! (They evoke a homey feeling for almost everyone.)

Kitchen. Kitchens sell homes, so the importance of making your kitchen appealing can't be underestimated. Clean and de-clutter! Anything taking up counter or floor space must go (the only exception would be the types of designer touches seen in model homes). Anything displayed on the refrigerator must go. If your cabinets are old, consider resurfacing them. If your counter knobs are old or out-of-date, replacing them can be a relatively inexpensive "facelift." Get a woodtone touchup stick from your home supply store and fill in any nicks and scratches. Shelves and pantries must appear orderly and very spacious. Put those extra items in your newly rented storage unit or give them away!

Bathrooms. Again, clean and de-clutter! You absolutely must get rid of any mildew/mold. If you have a glass shower door, squeegee it after every shower. A mold-and-mildew remover and a soap scum remover can work wonders. Glass cleaning products do a good job of cleaning windows and mirrors (but be careful if you have brass fixtures since ammonia will cause these to pit). Do not display any personal toiletry items! Remove all deodorant, mouthwash, electric toothbrushes, etc. and put them in your cabinet. (Model homes never, ever display such items!) Pick up all bath mats/rugs. Keep your soap dishes pristine. If you have bars of hand soap, they should look new. Get a new set of high-quality, neutral, fluffy towels and display them. (Model homes always do this!)

Rest of the House. Clean, repair, de-clutter, and de-personalize! You're going for that Executive but neutral look, since almost everyone can "see themselves" in a home like that.

Remove those knickknacks!
Remove enough items from your closet so you can hang a garment without touching the garment next to it - - this could be difficult. (Extra and out-of-season clothes go to your newly rented storage unit.)
Remove area rugs
Remove throw blankets
Remove throw pillows (or replace with "designer" pillows)
If your houseplants are anemic, remove them. Replace with high-quality silk plants or healthy houseplants in brass, wicker, or plain ceramic containers.
Take a hard look at your carpets. Are they stained or worn? Replacing carpets is often an excellent investment because it gives your home that "new" look that everyone wants. (Buyers have notoriously poor imaginations, so replacing existing carpet with neutral carpet is usually a much better idea than offering a "carpet allowance.")
Leave all the lights on (No burned-out lightbulbs!)
Keep wastebaskets empty
If possible, send your pets to stay with family or friends. As much as we love our pets, they can be a major negative distraction to potential buyers.
Leave your home before potential buyers arrive

Thursday, December 18, 2008

Staging Your Home to SELL

Want to sell your home quickly and for top dollar? "Staging" can help. "Staging" is presenting your home in its best and most appealing light to the majority of home-buyers.

In theory, "staging" isn't hard or costly, but in reality, many homeowners find it difficult because it's often hard to see something objectively when we love it.

An easy way to see effectively "staged" homes is to visit decorated models. Decorating a model is expensive, but builders are willing to invest the cost because they understand just how well a "staged" home sells. You too can profit from this knowledge.

Basic Staging Rules

#1 - Clean. Your home must sparkle! To achieve this level is usually only feasible by hiring a cleaning crew. In fact, having a cleaning service return weekly while your house is for sale is probably a pretty good investment. Get your windows professionally cleaned inside and out too.

#2 - Fix. Got a dripping faucet or a cracked tile? These will send the wrong message to potential buyers. Getting them fixed before you put your house on the market is a smart idea.

#3 - Eliminate Clutter. The "50% Rule" requires that you eliminate the clutter in your home by at least half. This may be the hardest rule of all! We love our clutter - - it reflects our memories, hobbies, and values. But it doesn't sell homes! Clutter makes homes seem smaller and disorganized. (Have you ever noticed that the really expensive stores seem to have an expansive, clutter-free layout, while "cheap" stores are often a jumble of merchandise?) Even the ancient practice of Feng Shui has as a central focus the elimination of clutter.

#4 - Executive Neutral. Neutral colors sell. It's a fact. Try to convey an image of quality and neutrality. Potential buyers walking through your home want to imagine themselves as the owners. If you use styles or colors they would never select, you've just turned them off. Staying high-quality, but neutral is safest.

#5 - De-personalize. Remove objects that your potential buyers won't be able to identify with. For example, political and religious items may turn off whole groups of buyers, because they cannot "imagine" your home as their home. Buying a home is an emotional decision, and you want potential buyers to make an emotional connection with your home by being able to "see" themselves in it.

Wednesday, December 17, 2008

Valuable Links for Researching Real Estate

Whether Buying, Selling or Investing, you are wise to explore the many valuable resources available before making any decisions regarding Real estate. Here are just a few of the websites you may want to familiarize yourself with --
Find homes, Stats & trends, Advice & opinions
Home Values, Finance & mortgage, Advice & guides
Real Estate Law resources, Articles & FAQ
Real Estate and Mortgage resources
Alain Pinel presents a myriad of services and resources for Buyers, Sellers, and Investors alike --

Tuesday, December 16, 2008

Instant Analysis of Today’s FOMC Decision

The Fed’s all in and throwing in the kitchen sink for good measure.

"The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability"

Stock and bond markets are celebrating in the wake of an FOMC statement that exceeded nearly all expectations for a substantial easing of policy today. At the time of this writing, the Dow is up about 340 points, and the 10-Yr Treasury yield has plunged to 2.36 percent from 2.50 percent yesterday. Throwing all caution to the wind, the Fed is betting that drastic rate cuts are needed immediately in order to support consumer and business borrowing in the face of a rapidly deteriorating economy and the specter of deflationary forces afoot. Such drastic measures only highlight the scale and scope of the current economic and financial crisis that still lies ahead. The Fed is now pulling nearly all its policy levers and only time will tell if it is pushing on a string, or if monetary policy still has a viable channel in which to operate.

For the first time in its history the Fed has decided to establish a target range for the Fed funds rate of between zero and 0.25 percent, effectively making 0.25 percent its interest rate ceiling. This is also an admission that the Fed has been having trouble maintaining its target as massive injections of about $1.0 trillion into various credit facilities, bank re-capitalization, and the payment of interest on bank reserves make an explicit target nearly impossible to achieve. The movement to a target range also rightly puts the focus of additional policy actions on the scope and scale of outright purchases of MBS, and agency debt. The committee is also exploring the potential benefits of purchasing longer-term Treasury securities as well.

Moreover, the FOMC signaled that they expect to maintain an exceptionally low fed funds rate target of some time. This signal is designed to push longer-term Treasury yields even lower, and from today’s action it seems to have worked.

The FOMC statement begins by describing an economy mired in a deepening recession, with little prospect for near-term relief, stating that labor market conditions have deteriorated, and consumer spending, business investment, and industrial production have declined. The Fed’s view of credit market conditions has not improved, and their outlook for the economy has weakened further.

Finally, the Fed doesn’t mention the prospect of deflation in the statement, but did highlight the prospect for inflation to moderate further in the coming quarters.

Expect further expansion and utilization of the Fed’s existing credit facilities, as well as the addition of new ones in 2009 as the Fed moves further down the path of quantitative easing.

Scott A. Anderson, Ph.D.
Senior Economist
Wells Fargo Economics

IRS to help homeowners refinance or sell homes

WASHINGTON – The Internal Revenue Service said Tuesday it will try to make it easier for homeowners in financial straits to refinance or sell their homes.

The plan announced by IRS Commissioner Doug Shulman would speed up a process where financially distressed homeowners may request that a federal tax lien be made secondary to liens by the lending institution that is refinancing or restructuring a loan.

Taxpayers will also be able to ask the IRS to discharge, or remove, its claim to a property in certain circumstances where the property is being sold for less than the amount of the mortgage lien.

"We need to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today," Shulman said, stressing that "we don't want the IRS to be a barrier to people saving or selling their homes."

He said the program will focus on those people who ordinarily pay their taxes in full but "because of these extraordinary times are getting behind in their tax payments."

A tax lien occurs when the government makes a legal claim to property as security or payment for a tax debt. The government thus notifies other creditors that it has a claim on the property.

The IRS can rule that its lien will be secondary to another lien, such as that of a lending institution, if it determines that taking a subordinate position will ultimately help with the collection of the tax debt. Taxpayers or their representatives may apply for a "subordination" of a tax lien if they are refinancing or restructuring their mortgage.

Lending institutions generally want their lien to have priority on the home being used as collateral.

Taxpayers may also request a certificate of discharge if they are giving up ownership of the property at an amount less than the mortgage lien if the mortgage lien is senior to the tax lien. A discharge does not relieve a person of the tax that is owed, but it does remove the lien on a particular property such as a home. The IRS would still maintain its lien on other possessions of the taxpayer.

Normally it takes about 30 days to rule on a request for a discharge or subordination of a tax lien, but Shulman said the IRS will work to speed up that process so there would be no delays for people trying to obtain new mortgage loans. The IRS urged people to contact the agency's Collection Advisory Group early in the home sale or refinancing process.

The agency said it issues more than 600,000 federal tax lien notices annually and that currently there are more than 1 million outstanding tax liens tied to both real and personal property.

Green Living Tips

Green Living Tips
From NDA – National Disclosure Authority

1.) Drive a Hybrid. There are many choices available and the hybrid industry is rapidly expanding.

2.) Buy a terrapass for your home or car. It’s simple, just visit the website at

3.) Switch out your old lightbulbs with the latest energy saving bulbs.

4.) Try motion sensor lights so you don’t have to remember to turn them off.

5.) Work from home if your job permits.

6.) Use glass or ceramic glasses, mugs and dishes instead of plastic disposable ones.

7.) Go paperless! Conduct your business online.

Federal Reserve Has Cut Rates

WASHINGTON (AP) -- The Federal Reserve has cut its target for a key interest rate to the lowest level on record and pledged to use "all available tools" to combat a severe financial crisis and prolonged recession.

The central bank on Tuesday said it had reduced the federal funds rate, the interest that banks charge each other, to a range of zero to 0.25 percent. That is down from the 1 percent target rate in effect since the last meeting in October. Many analysts had expected the Fed to make a smaller cut to 0.5 percent.

The Fed's aggressive move was greeted enthusiastically by Wall Street. The Dow Jones industrial average rose about 210 points in late-afternoon trading.
The Fed's action and statement made clear that economic conditions have worsened since its last meeting in October.

Federal Reserve Chairman Ben Bernanke and his colleagues said they will use unconventional methods to try to contain a financial crisis that is the worst since the 1930s and a recession that is already the longest in a quarter-century. For example, the Fed last month said it planned to purchase up to $600 billion in direct debt and mortgage-backed securities issued by big financial players including Fannie Mae and Freddie Mac in an effort to boost the availability of mortgage loans.

That move was one of a series the central bank has taken to increase its loans by hundreds of billions of dollars as a way to deal with the worst financial crisis to hit the country in more than 70 years. The Fed on Tuesday also made clear that it intends to keep the funds rate at extremely low levels. "The committee anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time," the central bank's panel that sets interest rates said in a statement.

Even before the announcement of a lower target, the funds rate has been trading well below the old target of 1 percent. For November, the funds rate had averaged 0.39 percent. Analysts said it was likely to fall further with the Fed setting the new target as low as zero. The Fed's decision is expected to be quickly matched by a reduction in banks' prime lending rate, the benchmark rate for millions of business and consumer loans. Before the Fed announcement, the prime rate stood at 4 percent.

The Fed has never pushed its target for the federal funds rate as low as zero to 0.25 percent. The lowest target rate before had been 1 percent, a level seen only once before in the past half-century. Given how low interest rates are, the central bank said it planned to use a variety of unconventional methods to flood the banking system with credit and drive interest rates lower. "The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability," the Fed said.

The announcement on the deployment of unconventional methods had been expected given that Bernanke and other Fed officials have sought in recent comments to let financial markets know that the central bank will not be out of ammunition to battle the economic downturn even with the funds rate at such low levels.

In its statement Tuesday, the Fed said that since its last meeting in late October, "labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment and industrial production have declined. Financial markets remain quite strained and credit conditions tight."

The central bank acknowledged that it had room to battle the economic weakness because inflation pressures have "diminished appreciably" as the price of energy and other commodities has fallen sharply. The Fed action came only hours after the government announced that consumer prices dropped by a record amount of 1.7 percent in November, reflecting a record decline in the price of gasoline and other energy products.

Current Historically Low Interest Rates Create Opportunities

On Tuesday, policy makers at The Federal Reserve are expected to lower their target for the overnight federal funds rate to 0.5 percent, a record low.

Recent headlines of the nations’ financial woes have brought even more attention to the changes in the Real Estate market. Most of these stories have failed to focus on the potential opportunities possible to the consumer with such low interest rates.

You may be able to take advantage of low interest rates by refinancing your current loan or seizing the moment to buy a new home! You may be able to lock in rates that may be advantageous over the entire life of your new mortgage.

For more information about current rates and the mortgages that are currently available please contact me at:

Monday, December 15, 2008

Fed Ready to Slash Rates


Fed ready to slash rates as deepening recession leaves more unemployed, nest eggs in shambles

WASHINGTON (AP) -- As unemployment rises painfully higher and nest eggs are shattered, the Federal Reserve is prepared slash a key interest rate -- perhaps to an all-time low -- in a desperate bid to stem the country's economic slide.

With the Fed's key rate dropping ever closer to zero, the central bank is moving into uncharted territory. Nonetheless, Fed Chairman Ben Bernanke has made it clear the Fed isn't running out of ammunition to fight the worst financial crisis since the 1930s. It is exploring using tools -- other than rate cuts -- to revive the economy. New insights on that front could be revealed when Bernanke and his colleagues wrap up a two-day meeting Tuesday.

"The message is simply the Fed stands ready to do everything in its power to stop the economy's free fall," said Richard Yamarone, economist at Argus Research.

In its battle against a recession that started last December, the Fed already has cut the target for the federal funds rate, its main tool for influencing economic activity, to 1 percent, a level seen only once before in the last half-century.

Many economists predict the Fed will cut the funds rate in half -- to just 0.50 percent. A few think the Fed could opt for an even more forceful action -- lowering rates by a whopping three-quarters percentage point or more. If that larger cut occurs, it would be the lowest on records that track the monthly average of the funds rate going back to 1954. The funds rate is the interest banks charge each other on overnight loans.

The benefit of another Fed rate reduction, though, may be mostly psychological, rather than economic. "It's a feel-good thing," said economist Ken Mayland, president of ClearView Economics. "Hopefully this a bridge to better confidence."
Slammed by the financial crisis, worried banks have hoarded their cash and been extremely reluctant to lend money to customers. Fearful consumers, watching jobs vanish and their investments tank, have sharply cut back their spending, including on big-ticket purchases like homes and cars that typically involve financing.

In response to the Fed's expected action, the prime rate -- now at 4 percent -- for many consumer and small-business loans would drop by a corresponding amount. The prime lending rate is used to peg rates on home equity loans, certain credit cards and other consumer loans. Cheaper rates could give pinched borrowers a dose of relief.

The goal of lower borrowing costs is to entice people and businesses to spend more, which would revive the economy. So far, though, the Fed's aggressive rate reductions have failed to stabilize the economy.
Bernanke says the Fed is weighing other ways to aid the economy given that it can lower the funds rate only so far -- to zero.

For example, the Fed could buy longer-term Treasury or agency securities on the open market in substantial quantities. This might lower rates on these securities and help spur buying appetites.

A Fed program announced late last month to buy $600 billion in debt and mortgage-backed securities from mortgage giants Fannie Mae and Freddie Mac already has helped pushed mortgage rates down.

By boosting the quantity of money in the financial system, the Fed has engaged in so-called "quantitative easing" to provide economic relief. The Fed's balance sheet has ballooned to $2.2 trillion, from close to $900 billion in September, reflecting efforts to mend the financial system.

"Never in the postwar history has the Fed acted as lender of last resort to this degree," Mayland said. In fact, with all the lending by the Fed, the actual funds rate has fallen at times well below its current 1 percent target.

As housing, credit and financial problems persist, the economic rubble mounts higher. Shell-shocked employers axed 533,000 jobs in November alone. That drove the unemployment rate up to 6.7 percent, a 15-year high. Since the start of the recession, the economy has shed nearly 2 million jobs. Analysts predict another 3 million more will be lost between now and the spring of 2010. Last week alone, Bank of America Corp., tool maker Stanley Works and Sara Lee Corp., known for food brands such as Jimmy Dean and Hillshire Farm, announced job cuts. General Motors Corp. and Chrysler LLC, are in danger of running out of money within weeks and are seeking government aid. The White House is exploring ways to throw a lifeline to Detroit after rescue efforts collapsed in Congress.

With the employment market eroding and consumers retrenching, the economy could stagger backward at a shocking 6 percent rate in the current October-December quarter, analysts predict. It shrank at a 0.5 percent pace in the third quarter.

President-elect Barack Obama is advocating an economic recovery plan that includes spending on big public works projects to bolster jobs. His plan also includes tax cuts to spur consumers to spend more and businesses to step up investment and hiring.

Thought for the Day

Thought for the day...

People forget what you said
People forget what you did
but people will never forget
how you made them feel.

Maya Angelou

Will You Be Considering Senior Housing Options?

While many of us would prefer to remain in our homes, for others the wide variety of Senior Housing alternatives seems like the wisest and most prudent thing to consider as they look towards growing older…

Just a few of the many alternatives available to us are Independent Living Facilities, Assisted Living Facilities, Skilled Nursing Facilities and Continuing Care Retirement Communities (CCRC).

Simply put, the Independent Living Facilities are designed for healthy seniors to enjoy a lifestyle filled with recreational, social and educational activities amongst other Seniors.

Assisted Living provides a combination of residential housing and personalized support services and care.

Skilled Nursing Facilities are designed for Seniors in need of 24 Hour Nursing Care.

Continuing Care Retirement Communities are residential campuses that provide the entire continuum of care – Independent Living, Assisted Living, and Skilled Nursing Care all in one location.

While there are many factors to consider when evaluating these alternatives, some of the most important are cost to the resident, appeal of the physical environment, proximity to one’s loved ones, and excellence of care. Secondary considerations might include activities offered, social and educational opportunities and amenities provided.

Friday, December 12, 2008

What's Next for Interest rates

What's Next for Interest Rates?

Lower rates seem likely in December as all recent indicators point to more troubled economic times. The Federal Reserve has already slashed its target rate down to 1 percent, without having done much to bolster lender confidence. Many analysts are estimating that the unemployment rate will continue to rise and this holiday season will likely produce lackluster spending results. The forecast for December interest rates is looking rather frosty!