Real Estate Information Archive

FORECLOSURES
Mainstream Media Myth: Everybody is losing their house.

Facts:
1. The US average foreclosure rate is 2.47%.
2. All of our markets (VA, MD, DC) have a foreclosure rate of less than two percent.
3. Foreclosure rates are moderate. Virginia ranks about 24th in foreclosure rates nationwide.
4. Only 7% of home loans in Virginia are sub-prime. Over half of Virginia foreclosures are on sub-prime loans.

INVENTORY
Mainstream Media Myth: Everybody has a house to sell.

Facts:
5. New home inventory topped out during the second quarter of 2006 and is thirty percent less today than it was then.
6. The National Association of Realtors Pending Home Sales Index, based on contracts signed in June, rose 7.4 percent in August to 93.4 from an upwardly revised index of 87.0 in July. The August reading was 8.8 percent higher than a year earlier, and the highest level since 101.4 in June 2007. Economists polled by Reuters ahead of the report were expecting pending home sales to drop by 1.8 percent.
7. Nationally, home sales were up 3.1 percent in August over July. Single family prices were up 1.1 percent in June from May.
8. Virginia second quarter (08) sales were up 48% over the first quarter (08).
9. Virginia median home prices were up six percent in the second quarter (08).
10. Single family inventory fell in Washington DC about 7.5% from April 08 to August 08.
11. Single family inventory fell in Montgomery County, MD about 7.5% from April 08 to August 08.
12. Sales are up and prices are down in many of our markets:
2nd Qtr 08 vs 2nd Qtr 07
MLS Area Average Price Sales Pending Sales
Dulles -18% + 7% + 37%
NVAR -14% -7% + 10%
Prince William -34% + 72% + 129%
Richmond Metro -2% -23% -26%
Roanoke Valley 0 % -22% N/A
Hampton Roads -2% -21% -15%

ECONOMY
Mainstream Media Myth: The sky is falling with no end in sight.

Facts:
13. The DC metro area added 35,000+ jobs from July 2007 to July 2008. This ranked fourth out of the fifteen largest metro areas. Nine areas had job loss or little noticeable gain.
14. The DC metro area has the lowest unemployment rate out of the fifteen largest metro areas and about two percentage points less than the national average.
15. Virginia is expected to add 19,000 jobs in 2008.
16. The average price of a home in Maryland has grown 9.3% since 1999.
17. People who purchased homes six years ago have, on average, seen the value of their homes rise over 24 percent, despite recent price declines.

HOME OWNERSHIP
Mainstream Media Myth: Now is a terrible time to buy.

Facts:
18. On Tuesday, September 30, Virginia Governor Tim Kaine called it a good time to buy a home in Virginia.
19. The average price of a home in Maryland has grown 9.3% since 1999.
20. The average renter’s net worth: $4,800. The average homeowner’s net worth: $171,000
21. In a recent survey, 8 out of 10 economists stated they believed housing prices would be higher five years from now.
22. An overwhelming majority of economists surveyed - by a better than 5-to-1 ratio - agreed with the statement, “A person can increase their long-term wealth by purchasing a house rather than renting.”
23. Over the past 30 years, home values have risen more than 6 percent annually.
24. People who purchased homes six years ago have, on average, seen the value of their homes rise over 24 percent, despite recent price declines.
25. On average, the value of a home doubles nearly every ten years.
26. 60 percent of the average homeowner’s wealth comes from their home’s equity.
27. Homeowners benefit from the power of leverage. At an annual appreciation rate of 5 percent, a 10 percent down payment on a home will return 94 percent after three years. After five years, it increases to 225 percent. After ten, 623 percent.

RE/MAX ALLEGIANCE

Facts:
28. Unlike many US businesses, Allegiance is not dependent on lines of credit.
29. Make no mistake: Allegiance is here for the long term.Division President Brian Sivak said it well the other day: “We became RE/MAX Allegiance to weather storms like this. Continue to use the Allegiance umbrella to stay out of the elements and together we will make it to clearer skies!”

RANDOM FUN FACTS

Facts:
30. The median selling price of a single family FSBO in Virginia was $249,500 compared with $313,400 for REALTOR assisted home sales. Is 26% more for a seller’s home worth paying a commission for? I’d like to think so.
31. Virginia’s population is expected to grow by 500,000 by 2010.
32. RE/MAX Associates averaged 39 percent more transactions than our nearest national competitor.
33. Keller Williams Associates averaged $1.1 million in sales in 2007. Long and Foster averaged $2.1 million. Allegiance Associates averaged $3.5 million.

Source: Charlie Bengel, Jr., CEO of RE/MAX Allegiance

The Commonwealth of Virginia has created an informative website to help homeowners who are facing the possibility of foreclosure and to help them be more proactive in preventing foreclosure.   You can find out more about preventing foreclosure at this website:

www.virginiaforeclosureprevention.com

From my own past experience with homeowners in this situation is that they are embarrassed and most wait too long to do anything about it. One resource that should be helpful on this website is the list of major mortgage companies and the proper phone numbers to call for assistance.  In many cases, the problem when an owner calls is they never speak to the correct department. 

If you wish to discuss your options or a possible short sale to prevent a foreclosure, please feel free to contact me by e-mail at Jorge@House4U.com or at 757-287-3400.  Please note their is no reason to be embarrassed about your situation, it is becoming more common than ever before. 

The Federal Reserve announced they were establishing a target range for the federal funds rate to 0% to 1/4% and committed to driving down mortgage rates with the following statement that was released:

...over the next few quarters the Federal Reserve will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant.

This is significant to home buyers and home owners who wish to refinance in the coming months.  We we likely see mortgage rates to continue to fall as new money is pumped into the system.  The reality is with rates dropping further from today's levels, it will be more cost effective to own than to rent and home buyers will be able take advantage of the mortgage interest tax deduction.  First time home buyers get a triple benefit since they also get to take the $7,500 tax credit when they buy a home. 

The latest scam is being delivered to the Virginia Beach and Chesapeake areas and across the country via Craigs List and a couple of other rental websites.  The rental amounts are usually below the going rate and renters in our area and across the country are falling for this scam hook, line and sinker.  Our area is especially prone to this scam, since a lot of folks are coming in from out of town and many are willing to rent sight unseen from the pictures. 

The way the scam works is the thieves are downloading pictures of actual rental properties and creating new advertisements for the same house with more favorable terms.  Like a beautiful Virginia Beach rental home with 4 bedrooms for $1,750 a month , $1,750 security deposit and the owner will not accept pets.  The new scam ad for the same house will say something like the rent is $1,250, no security deposit required and pets are OK.  Sounds like a great deal aye!

Unsuspecting renters are basically duped into sending the money, but the person on the receiving end are not the actual owners.  Local area real estate companies have had renters show up and ask for the keys, just to find out they were victims of a scam and their money is gone forever and now they have no home either. 

Basic Rules for Renting:

1. Any reputable Property Manager will require an application to verify who you are before renting to you.

2. Verify the Property Manager and the house are really for rent before sending in your money.  If it offer is too good to be true, it probably is.  So beware of incredible offers to rent cheap. 

3. Many agents use a cell phone number, but ask for the office phone number to double check.  Call the office and asked to be transferred to the agent. 

4.  If you live out of town, ask a friend or co-worker to take a look at the house and meet with the agent to actually look inside the house.

With people buying LCD TVs, XBox, PS3, Blu-Ray players, etc, over the holidays, your favorite electronics retailer will be happy to sell you overpriced HDMI cables to connect your new gear.  The best prices I have found are on the www.Monoprice.com.  I have bought HDMI and other electronic and computer related cables from Monoprice several times in the past and have been very satisfied.  They are a great compnay with quick shipping. 

Jorge

The following is an article that appeared on CNET recently and is worth reading:

In the bustle of holiday shopping, it's easy to be persuaded by the salesperson at your local retailer that you need to buy a $50 HDMI cable to make your new gear work. They might say the expensive cable "supports faster speeds," "has better video quality," or that "cheap cables don't support 1080p"--pretty much anything to get you to throw that high-margin HDMI cable in your shopping cart. But the truth is that expensive HDMI cables aren't worth it and the cheap cables available online are just as good. In fact, our guide to HDMI cables says this in bold, at the top of the page:

CNET strongly recommends cheap HDMI cables widely available from online retailers instead of the expensive counterparts sold in your local electronics store.

The full guide explains all the reasons in detail, but the main takeaway is that you should never pay more than $10 for a standard 6-foot HDMI cable. Cheap HDMI cables can be found all over the Web--we've had good experiences with both Monoprice and Amazon. Then you can take the money you saved and get some gear that's actually worth it--check out CNET's Holiday Gift Guide for suggestions.

Read CNET's Quick Guide to HDMI cables.

Real estate brokerage Realogy sought to skirt defaults on some of its bonds by launching a debt exchange but Carl Icahn’s venture-capital firm, High River, threw a wrench in its plans by slapping Realogy with a lawsuit and accusing it of delaying the inevitable.

High River, which owns some of Realogy’s senior bonds, alleges the repayment of its securities would be unfairly delayed under the debt deal announced last month since it may give new debtholders certain benefits such as moving them up on the repayment list if Realogy goes bankrupt.

Realogy, which owns brokerages Century 21, ERA and Coldwell Banker, planned to exchange $1.1 billion worth of bonds for new securities of roughly half of their value under the offering. The company is owned by Leon Black’s private-equity firm, Apollo Management, which acquired the sucessor company to Cendant for $9.0 billion two years ago.

In a filing with the Securities and Exchange Commission dated Tewsday, the real estate company said as of the close of business on Nov. 26, it had received $237.1 million total aggregate principal amount of commitments for the second-lien incremental term loans, which will be due in 2014 and 2015. If no other commitments are received, the company’s outstanding debt would be reduced to $286.0 million, upon fulfilling the invitations, the filing said.

The filing also mentions the litigation brought by High River, which alleged the new loans breach terms of Realogy’s senior toggle notes contract.

“The company believes that the allegations contained in the complaint are without merit and intends to vigorously defend this action,” Realogy said in the filing, adding that it believes the incurrence of the new loans are allowed under the senior toggle note contract and credit agreements.

Interestingly, the filing says that Bank of New York Mellon, the trustee charged with monitoring the notes, last month told Realogy that it did not think the offer complies with the terms of the securities. It wasn’t clear if the objection was the same one that Icahn made, and the filing did not say if Realogy replied or if it disagreed.

Icahn, who considers his fellow billionaire Black a friend, downplayed personal aspects of the lawsuit during a television interview. The activist investor said that given current market conditions, bankruptcies are unavoidable and that companies aren’t helping anyone by prolonging the inevitable.

Source: Forbes

Most people are familiar professional designations like CPA and MD after names of Accountants and Doctors, but real estate professionals have many opportunities to earn designations too. Most depend on whether they are in Brokerage Management, Property Management, Appraisals, and Real Estate Sales.

The letters ABR, CRS, GRI after my name are professional desiginations I have earned over the course of my career. 

ABR - Accredited Buyer’s Representative Designation is provides specific training and education for providing buyer-client representation and is the benchmark of excellence in buyer representation.  Buyers should always look to see if their agent has a ABR designation before entering into a buyer broker agreement.  I was one of the first real estate professionals to earn this designation and their are a little more than 50,000 active ABR Designees today.

CRS - Certified Residential Specialist Designation is the highest Designation awarded to sales associates in the residential sales field. The CRS Designation recognizes professional accomplishments in both experience and education.  Since 1977 the Council of Residential Specialists has been conferring the CRS Designation on agents who meet its stringent requirements. Currently, there are more than 39,000 active CRS Designees.  Buyers and Sellers should always ensure their agent has earned this designation. 

GRI - Graduate REALTOR® Institute Designation is the mark of a real estate professional who has made the commitment to provide a high level of professional services by securing a strong educational foundation. REALTORS® with the GRI designation are highly trained in many areas of real estate to better serve and protect their clients.

Professional real estate agents who are willing to dedicate themselves to their profession should be willing to further their education after being licensed.  A Virginia real estate license itself just provides basic knowlege to enter the business.  These Designations take years to earn and are based on experience and education. 

Why hire the least experienced agent with no training when for most peole real estate is the one of the largest investments of their life, when it does not cost anything extra to hire the higest qualifed person you can find.  

Who said it is not a good time to buy a home? George and Laura Bush are going to be relocating soon and just purchased a new home in Dallas. 

Read more about the details here ....

http://dallasdirt.dmagazine.com/2008/12/03/dallas-dirt-exclusive-the-bushs-dallas-homes/

Applications to refinance home-mortgages jumped by a record amount, as borrowers flocked to take advantage of falling mortgage rates -- which were driven down by the government's announcement that it would step in to stabilize the mortgage market.

On Wednesday, the Mortgage Bankers Association reported that its index of refinance applications had tripled, the largest increase since the group began tracking this data in 1990.

Applications to purchase homes, which tend to be less sensitive to interest-rate movements, also increased, though by a smaller amount.  The surge in application volume comes as mortgage rates fell by more than 0.50 percentage in the past week.

Source: WSJ Online