Greenspan: Recession Still Possible

By: Associated Press

HONG KONG -- Former U.S. Federal Reserve Chairman Alan Greenspan warned Monday that the American economy might slip into recession by year's end. He said that the U.S. economy has been expanding since 2001 and that there are signs the current economic cycle is coming to an end.

"When you get this far away from a recession, invariably forces build up for the next recession, and indeed we are beginning to see that sign," Greenspan said via satellite link to a business conference in Hong Kong. "For example, in the U.S., profit margins ... have begun to stabilize, which is an early sign we are in the later stages of a cycle.

"While, yes, it is possible we can get a recession in the latter months of 2007, most forecasters are not making that judgment and indeed are projecting forward into 2008 ... with some slowdown," he said.Greenspan said that while it would be "very precarious" to try to forecast that far into the future, he could not rule out the possibility of a recession late this year.The U.S. economy grew at a surprisingly strong 3.5 percent rate in the fourth quarter of 2006, up from a 2 percent rate in the third quarter.

A survey released Monday by the National Association for Business Economics showed that experts predict economic growth of 2.7 percent this year, the slowest rate since a 1.6 percent rise in 2002.Greenspan also warned that the U.S. budget deficit, which for 2006 fell to $247.7 billion, the lowest in four years, remains a concern."The American budget deficit is clearly a very significant concern for all of us that are trying to evaluate both the American economy's immediate future and that of the rest of the world," he said via satellite at the VeryGC Global Business Insights 2007 Conference.Greenspan also said he has seen no economic spillover effects from the slowdown in the U.S. housing market."We are now well into the contraction period, and so far, we have not had any major, significant spillover effects on the American economy from the contraction in housing," he said.

WHEN WILL THE CRUNCH BE OVER?

Most agree the housing crunch isn't over yet.

Housing is proving to be one of the biggest wild cards in the economy in 2007 as analysts are deeply divided about whether the worst in the downturn is over or there is much more pain to go. Only nine percent of economists say the housing decline ended in 2006, according to a USA TODAY survey of 55 economists taken Jan. 18-24. Another 42 percent said the downturn will end in the first half of the year, and 45 percent said housing will bottom out in the second half.

When housing bottoms out is key for the economy. Thus far, the fallout has been small. The economy grew at a faster pace in 2006 than in 2005 even though sales of previously owned homes fell 8.2 percent, the biggest drop in 17 years, the National Association of Realtors says. But the economy may not be able to shrug off further declines, A.G. Edwards & Sons Chief Economist Gary Thayer says. Lower energy prices and a strong job market have thus far helped consumers weather the housing downturn. But going forward, those two factors may not be big enough to offset further weakening, Thayer says.

Economist Tucker Hart Adams says the housing market won't stabilize in 2007. The combination of resetting adjustable-rate mortgages, homeowners unable to keep up with payments on so-called exotic mortgages such as interest-only loans, and other debt will lead to higher foreclosure rates and more homes on the market, she says. "It's really optimistic to think that it just took a little adjustment and everything is fine," she says. "It's one time I would like to be wrong." (USA TODAY)

Study Shows Market for Luxury Homes Remains Strong

The results of a study on luxury real estate trends conducted by Sotheby’s International Realty and Architectural Digest suggests that the market for luxury homes remains strong. The survey finds that a significant percentage of luxury homebuyers are seeking to purchase an additional home within the next two years.

Specifically:

* One in three Architectural Digest subscribers (36 percent) is planning to acquire a secondary/additional home within the next two years.

* Of those who already own three or more homes, 49 percent plan to acquire an additional home within two years.

* Of those who already own a second home, 35 percent plan to acquire a third home within two years.

* In an indication that young affluent consumers are in the market for second homes, 44 percent of those under age 45 stated that they may acquire a second home in the near future.

The study, “Seeking a Luxury Lifestyle,” found that waterfront property (75%) is the most sought after amenity when buying a secondary residence. Additional amenities studied by the survey indicated the following preferences: on/near golf courses (48%); near aquatic activities (45%); in-home fitness center (34%); media room/home theater (32%); on/near ski slopes (28%); wine cellar (18%); gourmet/large kitchen (10%); large backyard (5%); and pool (5%).

UP UP UP!

Gradual Rise Predicted

After bottoming in the fourth quarter of 2006, existing-home sales are forecast to gradually rise through 2007 and into 2008, while new-home sales should turn around by summer, according to the latest forecast by the National Association of Realtors. David Lereah, NAR’s chief economist, said annual totals for existing-home sales will be fairly comparable between 2006 and 2007. “We have to keep in mind that we were still in boom conditions during the first quarter of 2006 with a high sales volume and double-digit price, it’ll be pretty much of a wash in terms of annual totals. The good news is that the steady improvement in sales will support price appreciation moving forward.”

Existing-home sales for 2006 are expected to come in at 6.50 million, the third highest on record, with a total of 6.42 million seen in 2007. New-home sales in 2006 should tally 1.06 million, the fourth highest on record, with 957,000 projected this year. Total housing starts for 2006 are likely to be 1.81 million units, with 1.51 million forecast in 2007, which would be the lowest level in a decade. Builders are pulling back on new construction to support prices of remaining inventory.

The national median existing-home price for all of 2006 is expected to rise 1.1 percent to $222,100, and then gain 1.5 percent this year to $225,300. The median new-home price, after rising only 0.3 percent to $241,600 in 2006, is projected to grow 3.0 percent in 2007 to $248,900.

Real Estate is STILL the Best Investment.

Want the Bad News First? You Got it.

Housing markets ready for a FALL...

Fortune asked Mark Zandi, chief economist at Moody's Economy.com, and real estate valuation company Fiserv Lending Solutions to give their take on what lies ahead for housing in the country's 100 largest metropolitan areas. They predicted that 36 of the 100 biggest markets are expected to see price declines.

The area poised for the biggest fall in 2007 is Stockton (CA), where prices are expected to drop by 7.1 percent and another 5.3 percent in 2008. Next in line is Las Vegas, where the forecasters think prices will sink 6.6 percent in 2007 and another 8.1 percent in 2008.Rounding out the top ten markets expected to fall are Bakersfield, CA (-5.5% in 2007, -6.6% in 2008), Santa Ana/Anaheim, CA (-5.5% in 2007, -4.5% in 2008), Los Angeles/Long Beach, CA (-5.4% in 2007, -4.6% in 2008), Miami, FL (-4.9% in 2007, -7.5% in 2008), Sarasota/Bradenton, FL (-4.8% in 2007, -0.8% in 2008), Oakland, CA (-4.6% in 2007, -2.4% in 2008), Fresno, CA (-4.6% in 2007, -4.3% in 2008) and Fort Lauderdale, FL (-4.3% in 2007, -4.3% in 2008).



And Now for the GOOD NEWS!!



Housing markets predicted to RISE!


Fortune also asked Mark Zandi and Fiserv Lending Solutions to predict which markets would rise in 2007. McAllen, TX is predicted to rise 8.5 percent in 2007 and another 9.8 percent in 2008 and El Paso, TX is predicted to rise 7.1 percent in 2007 and 4.4 percent in 2008. In fact, four of the hottest U.S. home markets forecast for the next year are in Texas.

Rounding out the top ten markets expected to rise are Albuquerque, NM (5.9% in 2007, 0.6% in 2008), Salt Lake City, UT (5.4% in 2007, 1.9% in 2008), Syracuse, NY (4.8% in 2007, 3.6% in 2008), San Antonio, TX (4.8% in 2007, 3.5% in 2008), Rochester, NY (4.5% in 2007, 4.2% in 2008), Baton Rouge, LA (4.5% in 2007, 2.8% in 2008), Fort Worth/Arlington, TX (4.4% in 2007, 3.5% in 2008), and Birmingham, AL (4.4% in 2007, 3.5% in 2008).
requirements. (CNNMoney.com)

"Sexy! Fetching!! Fabulous!!!"
Washington Post (12/02/06) P. F1 ; Festa, Elizabeth


The housing slowdown poses a challenge for brokers who write property descriptions, with experts noting a change in the language used to attract prospective buyers. "It doesn't necessarily become more ornate," explains George Washington University anthropology professor Joel Kuipers. "It can become more direct and hard-hitting and move toward a harder sell." FranklyRealty.com founder Frank Borges LLosa says he scans advertisements for signs of motivated sellers who may be willing to accept lower offers. An analysis by Paul JJ Payack of San Diego-based Global Language Monitor finds that property descriptions increasingly are including the words "embassy-style," "turret," "flow," "livable," and "low maintenance;" while such words as "spacious," "dream," "granite," "architectural," and "sexy" have fallen out of favor this year. Meanwhile, research by University of Chicago economists Steven Levitt and Chad Syverson reveals that homes whose ads feature numerous exclamation points and the words "spacious," "charming," "fantastic," or "great neighborhood" tend to sell for less than the asking price. Regardless of the words used to describe a particular property, agents say buyers remain most influenced by location and price.

What to Do? Best for the Buyer?

===Discount real estate brokers face new hurdle for Web listings===

A revised policy approved by the National Association of REALTORS this week may make it harder for discount brokers to draw attention to homes they list for sale.The policy, approved by directors of the trade group at their convention in New Orleans, involves information about homes that real estate brokers get from their local multiple-listing services, databases that are typically operated by local REALTOR associations. Among other things, the policy reaffirms that brokerage firms that put listings from the MLS on their own Web sites can exclude certain homes.

The revised policy states that brokers must use "objective criteria" if they screen out some listings. The criteria could include location, type of property, compensation offered for agents who find a buyer or the level of service provided by the listing company. Thus, listings from brokers providing limited service for lower fees could be excluded from other brokers' sites.

By contrast, the policy now states that multiple-listing services must make all types of listings available to the Web sites of participating brokers. It would be up to brokers -- not the MLS -- to decide which listings are used on individual brokers' sites. (James Hagerty, The Wall Street Journal Online)

Chris's take: This trend is not good for business, in my opinion...Buyers should be exposed to all points of the market, to include FSBOs, Traditional and Discount Broker inventory.
The real story is this: Many Brokers who provide EXCLUSIVE BUYER REPRESENTATION services need to know how to truly be exclusive!

When a Buyer engages the services of a Broker who provides exclusive representation, there should be a wittten agreement to work together prior to the start of any business or activity on behalf of the Buyer-Client's acquisition. This can be accomplished with a simple agreement outlining the Broker's fee structure, and discussion of how business is transacted under that states's laws and regulations. That structure shall remain the same throughout the relationship(save and except any variations or changes to the agreement).

Example: A home is listed in the MLS by a Discount Broker. The Agent or the Buyer identifies the listing, which happens to be listed for sale by a Discount Broker. Fine...

The Discount Broker's Seller-Client is willing to pay a 1% commission to a Broker working with the Buyer. NO PROBLEM!! The Buyer and their Broker already have an EXCLUSIVE BUYER REPRESENTATION agreement, which defined the relationship to include the Broker's fees. So the Buyer acknowledges before even seeing the property that the 1% will be a 'credit' toward the previously agreed-to fee in the EXCLUSIVE BUYER REPRESENTATION agreement. CAPICHE?

This is elementary...no different than engaging the services of a Listing Broker. There is no work done until there is a LISTING AGREEMENT. Same-Same.

Happy Thanksgiving!

Baby Boomers put their faith in real estate

Rename them the real estate boomer generation: A comprehensive new demographic study reveals that the 78 million Americans born between 1946 and 1964 have a passion for owning real estate unlike any in the nation's history.Ninety-six percent of all boomers believe that owning a home is a very smart financial investment, and nearly 4 out of 5 now own homes, while 1 in 4 boomers owns other forms of real estate besides a primary home. These include one or more vacation or seasonal retreats, acreage or income-earning property.

The value of boomers' primary homes varies sharply by geographic region. Overall, the median market value of their homes nationwide is $181,700. But in the Midwest, the median is $143,400, in the South it's $147,800, in the Northeast it's $215,000 and in the West it's $359,100. One of every 14 boomer households in the Western states owns a home worth $1 million or more.

Home equity plays a huge role in boomers' financial planning and well-being. Their median equity stake - the market value of their real property minus mortgage debt - is $100,000. The median household net worth of boomers - financial holdings plus real estate, minus all debt obligations - was $149,500 in early 2006. However, 23 percent of boomers age 50 to 60 control equity stakes of $250,000 to $1 million or more. Fifteen percent of boomers aged 42 to 49 already have accumulated home equities of $250,000 to $1 million.

Home equity represents a significant percentage of total household net worth for most boomers. Thirty-six percent of 50-year-old to 60-year old homeowners report that the equity in their primary residences is 51 percent to 100 percent of their household net worth. Thirty-eight percent of boomers between 42 and 49 report the same.

Chris: A major way to provide assets for the rising health costs for the boomer generation, but then when is the right time for the boomers to sell based upon the next generation's needs or desire to have similar holdings? Or not?

Existing Home Sales Fall for 5th Straight Month

Sales of existing homes fell 0.5 percent in August to a seasonally adjusted annual rate of 6.30 million, according to the National Association of Realtors. Sales have fallen five months in a row and in nine of the past 12 months. Sales are down 12.6 percent in the past year. It's the lowest sales pace since January 2004.

The median price of an existing home fell 1.7 percent year-over-year to $225,000. It's the first time since April 1995 that median prices have fallen on a year-over-year basis. It's the second largest decline in the 30-year history of the Realtors' survey, exceeded only by a 2.1 percent drop in November 1990. Inventories of unsold homes rose to 3.92 million, a 7.5-month supply at the August sales pace, the most since April 1993. At the August sales pace, it would take 7.5 months to sell the backlog of unsold homes, representing the longest period since April 1993.

Sales of single family homes were unchanged at a 5.51 million annual pace. But this sales pace was 12.3 percent lower than a year ago. Condo sales fell 3.5 percent to 793,000. By region of the country, sales of existing homes rose 1.9 percent in the Northeast to a seasonally adjusted annual rate of 1.07 million units in August.

The median price for a home sold in the Northeast was $271,000, down 3.9 percent from August 2005. Existing home sales in the Midwest rose 0.7 percent to an annual rate of 1.44 million units with the median price dropping to $176,000, 1.1 percent below a year ago.Sales in the South fell by 0.8 percent to an annual rate of 2.51 million units with the median price falling to $184,000, down 2.6 percent from a year ago. Sales in the West fell by 2.3 percent in August to an annual rate of 1.29 million units with the median price dropping to $345,000, up 0.3 percent from a year ago.

Don't Ask Me Why, But I STILL Think We Are Going to Have A Really Good 4th Quarter! Chris

Housing Trends In The Carolinas

Condo sales, building tepid
Inventory exceeds demand, analysts say
By Jenny Burns
The Sun News
Condominium developers are reacting to a softening market by slowing condo building in Horry County, N.C. - reversing a three-year trend. Single-family building continues to climb.
The number of condo building permits dropped 34 percent in the second quarter to 724 from 1,105 last year, while new condo sales fell 31 percent. Resale condo sales fell 26 percent, according to Market Opportunity Research Enterprises, a regional real estate market research firm in Rocky Mount, N.C.
The slowing sales mean better prices for buyers, and more incentives from builders to sell units.
The sales slowdown is showing up in Brunswick County, N.C., and Georgetown County as well.
"We don't see this as an extended downturn. Although it seems sharp right now, it is sharp only in the very short term as builders try to adjust from the excess of their starts late last year," said Bernard Helm, president of M.O.R.E, which tracks real estate markets in the Southeast.
Tom Maeser, market analyst and president of the Fortune Academy of Real Estate, said he has gotten many calls from developers concerned about the growing condo inventory on the market, which is triple what it was last year.
Maeser said condo developers are cutting back, often because they may have trouble getting the 80 to 100 percent presales that the bank requires for a construction loan.
The single family market is still going strong. Single family building increased 7 percent over last year to 1,535 from 1,433 even though new home sales stayed flat and resale homes fell six percent. Analysts say this could signal future softening in the single family market.
"Builders will have some excess inventory, and that will end up being good news for consumers. They have to work out that inventory and that means softening prices," Helm said.
The drop in resales and flat growth in new home sales - at 980 homes this year and last - signals new home sales may move into negative territory in the future, Helm said. An 11 percent drop in single family lot sales also signals a future drop in sales, he said.
Lawrence Langdale, vice president of Coldwell Banker Chicora Development, said he expects the single family market will remain strong while the condo market will take 18 to 24 months to adjust. He said the drop in single family lots is attributed to loss of investors in the market, since lots, like condos, are more often purchased by investment buyers.
Maeser said it's a good sign if home sales can stay on target with 2005's record sales - as it has done so far. He said the flat growth in new home sales indicates builders are being careful to stay even with last year and not build too many spec homes.
"They don't want to get stuck with a lot of inventory out there," Maeser said.

Brunswick County did not see the sales downturn that Horry County had in the first quarter, but sales in the nation's 28th fastest-growing county did drop in the second quarter.
"It means that the Brunswick market is not quite as volatile," Helm said.
New single family home sales in Brunswick dropped 7 percent to 471 from 506 and resales dropped 24 percent to 820 from 1,078. Single family lot sales also dropped 36 percent to 2,084 from 3,257.
Helm attributes the drop to rising interest rates on adjustable rate mortgages, making it difficult for buyers to purchase a second home. Helm said the Brunswick market is less volatile because it has fewer national builders than Horry County. Brunswick is also seeing a downturn in building condos and single family homes, but townhome building has picked up.
"It's doing a leveling off. We're also seeing county permitting leveling off," said David Sandifer, owner of Holden Beach Properties and Brunswick commissioners chairman. "I think we will see another spurt but this is just a lull."
Sandifer said the high end market in Brunswick is selling well, but there's a lack of moderate income housing. Townhome building is also up in Horry County. Langdale says builders are choosing townhomes and single family for future projects because they are more often purchased by primary homeowners.
Helm said the townhome market has strong demand on the Strand, but it can be easily overbuilt because it's a smaller market than the condo and single family markets.
In Georgetown County, resale homes have declined slightly but new home sales are up 60 percent to 104 from 65. New condo sales are also up from 45 to 151. "Georgetown County is getting ready to do what Horry County has already done. It's good on new but has problems in resales. The decline will happen in new home sales," Helm said. Single family building and lot sales have also dropped off in Georgetown County.
Prices in all three counties continue to show year-over-year increases.
The median price for homes and condos in Horry County increased 16 percent to $189,900 from $162,900.

Home Sales Index

Pending Home Sales Index Points To Easing Market WASHINGTON (September 1, 2006) – Home sales should be leveling out in the months ahead at a lower pace, according to an index based on pending home sales, a leading indicator for the housing market published by the National Association of Realtors®.The Pending Home Sales Index,* based on contracts signed in July, is down 7.0 percent to a level of 105.6 from a downwardly revised reading of 113.5 in June, and is 16.0 percent lower than July 2005.The index is derived from pending sales of existing homes. A sale is listed as pending when the contract has been signed and the transaction has not closed; pending sales typically are finalized within a month or two of signing.An index of 100 is equal to the average level of contract activity during 2001, the first year to be examined, and was the first of five consecutive record years for existing-home sales.David Lereah, NAR’s chief economist, said there’s a closer relationship between annual changes in the index and actual market performance than there is with month-to-month comparisons. “In looking at year-to-year comparisons, the pending home sales index has been very close in predicting the actual pace of home sales,” he said. “Based on recent changes from a year ago, the index shows existing-home sales should continue to ease after a stronger-than-expected decline in July, but are likely to flatten in the months ahead.”Lereah said psychological factors account for much of the decline in July home sales. “We’ve never seen a general decline in the housing market against a healthy economic backdrop where jobs are being created, the economy in growing and interest rates are favorable,” he said. “Psychological factors are causing some buyers to remain on the sidelines, waiting for prices to stabilize or for more favorable news about the market and the economy. Contributing to this hesitancy is a lot of negative news stories, but in the end we believe that underlying market fundamentals will prevail.”Regionally, the PHSI in the West declined 5.5 percent in July to 103.1 and was 20.3 percent below July 2005. The index in the South dropped 6.4 percent to 122.3 in July and was 11.3 percent below a year ago. In the Northeast, the index fell 7.7 percent in July to 92.1 and was 15.5 percent below July 2005. The index in the Midwest dropped 9.0 percent to 93.3 in July and was 20.1 percent lower than a year ago.The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.
# # #* The Pending Home Sales Index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity from 2001 through 2004 parallels the level of closed existing-home sales in the following two months. There is a closer parallel between annual index changes (from the same month a year earlier) and year-ago changes in sales performance than there is with month-to-month comparisons.The forecast will be revised September 7, and existing-home sales for August will be released September 25. The next Pending Home Sales Index will be on October 2.

Downsize, But Make it Special!

Homeowners say "Downsize Me!"

NEW YORK (Reuters) - Americans are carrying a lot of excess weight and desperately want to slim down. No, not their waistlines -- in the size of their homes.

"Steeply deteriorating." "Hard landing." "Kaput." These are some of the terms used by analysts to describe the slowing of the U.S. housing market. And with the glory days of home-price appreciation now over, some homeowners are declaring, "Downsize Me!"

A huge gap between the supply of homes for sale and demand for housing means prices are leveling off -- and could tumble. David Horwitz and his wife, Diane, are the type of homeowners looking to streamline their expenses and unload their roomy homes for more humbler abodes.
The Horwitzes, both semi-retired, just moved into a 1,200 square-foot apartment on the Upper East Side of Manhattan after living in a 2,200 square-foot home in Scarsdale, New York.
"Our property taxes went down by 1,000 percent, the ConEd (bill) was cut by two-thirds and the cost of home maintenance was reduced by at least 50 percent," said David Horwitz. "No gardener, no roofer cleaning gutters, no tree spraying, no snow removal, no exterior painting every six or seven years."

The Horwitzes, who have no mortgage, plan to reside in the apartment for a while, so even if prices fall it is of little significance to them.

Mike Wright and Lin Drury are also enjoying the city life.

Halstead Property, a Manhattan real-estate firm, recently sold the couple a 900 square-foot co-op in the Inwood Hills area of Manhattan. Their new place is smaller than the 1,100 square-foot townhouse they called home in Ossining, New York. A writer by profession, he said his motivation for moving to Manhattan was not just to downsize, but to be closer to his wife's job as an associate professor of nursing at Pace University, New York City and Westchester.

TIMING THE MARKET
Sometimes, though, buyers need to pay up to scale down.

The Wrights' downsizing was their second in two years. Prior to their Ossining home, they enjoyed a 2,200 square-foot condo four blocks from legendary Wrigley Field in Chicago.

"We realized prices would be higher in New York than in Chicago," Mike Wright said. "We didn't expect to get a smaller home while spending about one third more. If we'd bought, say, five years earlier, the price might have been less."

Diane Ramirez, president of Halstead Property, has seen downsizing pick up steam in recent months, especially among suburbanites in New York, New Jersey and Connecticut. "Homeowners are probably sensing now may be the right time to get the best price before the market cools further," Ramirez said. "Some of these homebuyers are empty-nesters now finding their homes are larger than what they need and more than they can handle."

In Florida, which saw double-digit home-price gains in the past few years, homebuyers appear more interested in perks. In fact, in the Sunshine State -- long-known as a downsize destination for retirees -- homebuyers are losing interest in size altogether. "People are at the point where they would rather have a luxurious interior than expand," said Budge Huskey, president and chief operating officer at Coldwell Banker Residential Real Estate in Sarasota, Florida. Potential buyers want kitchens designed for entertaining, state-of-the-art appliances, media rooms and home theaters, he said.

"Many of these people have downsized already, and now they want a more luxurious home," he said. "They are more interested in a Jacuzzi than another bedroom."

Gopal Ahluwalia, vice president of research at the National Association of Home Builders, a trade group in Washington D.C., said feedback from consumers and builders indicates the average size of a U.S. home is flattening out.

The average home size went from 1,500 square feet in 1970 to more than 2,400 square feet in 2005. During the same period, the average household size declined, from 3.11 to 2.59, he said.
"Ten years back, most people wanted more space -- now they want more features," Ahluwalia said. "If you look at 35 years of history, from 1970 to 2005, and even early 2006, home size has been continuously rising, except during periods of housing recession."

TAKE MY HOME, PLEASE!

In any event, packing up a house full of belongings -- which could be decades worth of stuff -- and transferring them to another home is a daunting and dreaded task.

A wealthy couple in one of New York City's toniest Fifth Avenue cooperative apartments came up with an unusual solution: They sold two rooms, or about 650 square feet, of their 3,400 square-foot apartment.

Edward F. Johnston III, vice president and director at Brown Harris Stevens, a Manhattan-based real estate firm that specializes in high-end property, advised the couple.

"It was a large space for just the two of them -- they never used the dining room," he said.

"Most high-end luxury buyers are not influenced by a cooling market, but if you own an apartment you always want to sell at the right time."

"They already had one of the biggest apartments on a high floor in one of the top buildings on Fifth Avenue," he said. "Did they really need 9.5 rooms as well?"

Copyright 2006 Reuters

Lighting Trends: Vocab and Tips

Light Done Right !

Lighting can do wonders for the look and feel of a home, both inside and out. Get tips on setting an inviting mood and showing off your home's best features.
BY BARBARA BALLINGER

Artificial lighting does more than brighten a dark room. It sets a mood, draws the eye to special architectural details, and makes a home’s entrance inviting long after the sun has set. Then there’s the decorative angle. With bulbs housed in big colorful paper lanterns, dangly crystal chandeliers, or crisp modern glass pendants, lighting also can be a focal point on its own.
Lighting offers yet another plus: When done right, it helps you showcase your home’s best features and speeds a sale. In this column, you’ll learn about the various styles of lighting fixtures for indoors and outdoors, and get tips on how to use lighting to your greatest advantage when selling a property. Illuminating VocabularyFirst, know how to speak the lighting language. These are the basic lighting terms to know when talking lighting:

Lamp. The light source, sometimes called a light bulb, which can be incandescent, fluorescent, or halogen. Lamps come in a range of colors and wattages.

Incandescent lamp. The most widely used source of illumination for the home, invented by Thomas Edison. It’s inexpensive and can be dimmed, but is inefficient. Light is produced by means of an element heated to the point of incandescence.

Fluorescent lamp. More energy efficient than an incandescent, it comes in many wattages, colors, shapes, and can be dimmed, if it has a dimmable ballast in the unit and a fluorescent dimmer control.

Halogen lamp. An incandescent lamp that contains halogen gases, it offers a crisp white beam, but is more expensive than an incandescent.

LED. A new light source, the light-emitting diode comes as a tiny bulb, gives off little heat, is more energy efficient than a fluorescent, lasts 50,000 to 100,000 hours, and comes in various colors. Downsides: These lights can be expensive, though the price is dropping, and they can be harder to find than regular bulbs.

Compact fluorescent (CFL). Although expensive, these fluorescent lamps conserve energy, last up to 10,000 hours, and have a high-quality color rendering capability, but are still pricey, though less than LEDs.
Light fixture. A complete lighting unit that includes a lamp, a sometimes decorative housing for the lamp, and a connection to the source of electrical power.

Rather than choosing lighting fixtures after a house is built or remodeled, design experts advise home owners plan their lighting look from the get-go so that lighting fixtures will fit in seamlessly with the rest of the home. Built-in lighting may be costly, but it’s worth it, experts say.

Retail lighting showrooms offer an advantage. Many of them have lighting labs, which are room-like vignettes showing how lighting will really look, and are staffed by consultants who will help home owners develop a master lighting plan, sometimes for no fee if purchases are made. Creating a Finished, Sparkling LookThe best lighting plans include three layers: general or ambient lighting that illuminates the entire space; mood lighting to create a special glow in designated areas; and task or accent lighting to play up architectural details, furnishing, or art.

“Lighting makes rooms breathe, adds drama, magic, and romance — and makes home owners feel comfortable,” says New York lighting and furniture designer Sergio Orozco. To decide how much light to use and where to use it, home owners should decide what tasks they’ll perform and what features they want to accent, Orozco says. You also should keep that advice in mind when prepping a home for sale; highlight areas of the home in which you’d like buyers to envision themselves going about daily life. Task lighting can turn attention to a granite countertop or an undermount sink, while accent lighting can make the Colonial-style fireplace stand out.

Here are some more indoor lighting tips from Orozco:

Use a consistent style. Factor in the style of décor and home’s architectural detailing. An elaborately decorated dining room may look better with a period crystal chandelier than a trio of funky colorful pendants.
Be task-specific: Lighting should be selected for tasks at hand. To see a computer screen well, for instance, place lighting behind the monitor so it’s not reflected on the monitor.
View rooms at night. Before making a lighting purchase, know what the room looks like at night, without any natural light.
Try sconces. Consider wall sconces when trying to create an elegant, romantic effect.
Don’t forget the cover-up. Be sure all fixtures have some type of cover so a bulb isn’t visible.
Use individual switches. Install several switches to control lights individually. Don’t forget dimmers.
Light Up the Outdoors. One easy way to expand a home: Make the backyard and deck visible from the house, even at night. Outdoor lighting can accent pools, gardens, trees, walkways, and entryways. Safety is an added bonus.

He also offers these tips for making a big impact outdoors:

Be selective. Rather than light up the entire yard, select a few features to highlight. Shy away from floodlights. Instead, use soft lighting that mimics the moon on a clear night.
Conceal the source. Whenever possible, choose and install outdoor lighting before landscaping is completed so transformers and wires can be concealed. Even if you don’t plan ahead, you should try to safely hide the lighting behind shrubs or bushes so the fixture isn’t apparent — unless it’s a decorative fixture, of course.
Protect against the weather. Select weather-resistant aluminum products.
For flexibility, go portable. Portable lights can be moved throughout the yard whenever you want. One day you can light up a pathway to the gazebo, the next day you can focus on the garden.
Experiment. Think about aesthetics and how different types of plants look in artificial light. It can be difficult to judge, so experiment by placing fixtures in different spots.

Among the hottest new trends:

Tiny lights. Miniature recessed lighting uses MR11 or MR16 low-voltage halogen lamps to illuminate ceilings, shelving, and more. The diameter of these fixtures is less than 3 inches.
Deep finishes. Oil-rubbed bronze, brown, and silver are popular finishes.
Ultra-modern chandeliers. Metal fixtures in modern shapes are hot sellers.
Familiar shapes. Simple geometric lamp shades with beading, embroidery, or fringe.
Pretty stains. Tea-stained glass for pendants and chandeliers is replacing alabaster-colored glass.

I know this was a long article, but think the information is really important for home selling and market preparation...Have a Great Day! Chris

New TV Show about Condotels!!

RISMEDIA, July 10, 2006—The new TV show, Condo Hotels Connection, showcases unique hotel properties that convert a portion of their rooms into condominiums available for public purchase. The show airs on the Dish Network, Direct TV and various web outlets. The show airs Wednesday evenings on DirectTV's Channel 341 at 9:30 pm EDT and Thursday evenings on Dish Network's Channel 223 at 9:00 p.m. EDT.
“The Condo Hotels Connection is designed to give investors more detailed information about our showcase properties,” says Steven Roszell, Owner of CondoHotels.com and HotelsForSale.com. “They will be able to get an inside look at the hotel, check out the floor plan, tour the property, view the amenities and visit the local area, all from the comfort of their own living rooms.” Condo hotels or ‘Condotels,’ convert a portion of rooms into condominiums and make them available for purchase. Once a property is bought, owners can enjoy their new luxury condo and/or choose to rent it. Owners receive a percentage of any rental proceeds and hotel management takes care of maintenance and cleaning.

Condo hotels attract many different types of investors. Clients overseas like being able to secure their money in the U.S. and have their property managed by the hotel. Retiring baby boomers enjoy owning a luxury vacation home with first class amenities. Corporations, too, are considering condo hotels as an alternative to corporate housing due to their prime downtown locations in popular cities and for facilities to accommodate meetings and conventions. “Condo hotel owners enjoy the privileges a first class hotel has to offer, from 24 hour concierge services, five star gourmet dining, recreation rooms and club houses,” says Roszell. “Potential investors can now view these properties in detail on TV and on CondoHotels.com. Tune into Condo Hotels Connection.”

If I can be of service by recommending a Broker for Condo-Hotels in a particular area, please let me know!

Chris
chris.mcnelis@comcast.net

Homeowners Insurance and Market Trends

Affordable Disaster Insurance Essential To Protect American Dream of HomeownershipWASHINGTON (June 28, 2006 )– Recent natural disasters have raised concerns that the cost of homeownership can easily spiral out of reach for the average consumer during times of catastrophe if homeowner insurance isn’t made affordable, the National Association of Realtors® said today in written testimony to the House Subcommittee on Housing and Community Opportunity.

“Options for obtaining and maintaining coverage for natural disasters are dwindling,” said Thomas M. Stevens of Vienna, Va., president of NAR.

“America’s hard-working families deserve a comprehensive federal natural disaster policy that makes natural disaster insurance available and affordable and reduces the circumstances under which insurance companies cancel these insurance policies.”

Recent research conducted by NAR in the state of Florida concluded that the lack of affordable or available homeowners’ insurance contributed to a slowdown in Florida real estate markets, which can contribute to a slowdown in overall economic activity in the region. “When buyers and sellers in high-risk states cannot obtain or retain homeowners insurance, which is necessary for a mortgage, it can slow home sales in those areas,” said Stevens. “A strong housing market is the foundation of a healthy economy, and as a nation, we must safeguard the vitality of the residential and commercial real estate markets.”

As Congress addresses the need for a comprehensive natural disaster insurance policy, NAR stands ready to assist in formulating solutions to this problem. “If the ‘big one’ hits, and people are not insured, then the American taxpayer will pay the price,” said Stevens.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.###

Foreclosure Trends

===Foreclosures rise nationally in May===

I've been contacting my Investor clients who may wish to take a leap at this point based upon trending of interest rates and foreclosures, which will lead to more need for rentals and the up-cycle for income property/passive investing. Getting the houses at the right price in an adjusting market is the tough part for the investor, as Sellers try to maintain a strong average sales price.

A one-month increase of 3,859 residential foreclosures nationwide tracked by Foreclosure.com confirms the existence of a buyer's market in the residential real estate sector, the company recently announced. Foreclosure.com data also indicates that investors are moving quickly to purchase foreclosed properties, with more than 25,000 foreclosed homes being sold in April 2006. Nationwide, there were 27,064 new foreclosures during May 2006 -- an increase of 16.6 percent compared to April 2006.

The total number of foreclosed homes available for sale in the United States climbed 1.9 percent from the previous month, totaling 89,327 during May. Increasing foreclosure rates during May in California and Florida contributed to an overall national upward trend in foreclosed homes, according to new Foreclosure.com data. Additionally, foreclosure rates rose significantly in Alabama, Louisiana and Mississippi, each of which had been experiencing a lower than normal foreclosure rate following Hurricane Katrina.


Chris

Affordable Housing Trends

Hi everyone, here's the latest and greatest trend we need to be aware of...especially public officials who have the ability to modify growth restrictions, create higher density zoning and demand more affordable housing through incentivizing developers. It is definitely a problem in our area, as the children of current residents cannot afford to return home and live here based upon the average home prices.


"===Affordability problems escalating even as housing market cools===
With interest rates rising and speculative demand cooling, the housing boom is coming under pressure, finds this year’s "State of the Nation’s Housing" report, released by Harvard's Joint Center for Housing Studies. As long as the economy continues to create jobs and builders trim production to match slowing demand, house prices will keep climbing and the housing sector will likely achieve a soft landing. Although house price growth will likely moderate in many areas, sharp drops in house prices are unlikely anytime soon. Even with higher interest rates and home prices crimping affordability, the lure of house price appreciation continues to draw homebuyers to the market. While the national homeownership rate edged down a tenth of a percent in 2005, it increased in the West and Northeast where house price growth was the strongest. In fact, about one million homeowners were added nationally last year. But, the report cautions, five years of unprecedented house price appreciation and decades of land use restrictions that make building affordable housing difficult are adding to widespread housing affordability problems.

From 2001 to 2004 alone, the number of households spending more than half their incomes on housing increased by 14 percent to 15.8 million. The paradox of today’s housing market is that while more people are building home equity than ever before, slow growth in wages for households in the bottom three-quarters of the income distribution is not keeping pace with escalating housing costs. Amidst a housing boom, it is now impossible to build housing at prices anywhere near what low-income households can afford without subsidies. "


Thanks for Reading!
Chris

===Real estate action shifting to middle America===
A new statistical analysis of housing price cycles in 100 major metropolitan areas suggests that real estate action is shifting to areas that didn’t enjoy the recent housing boom. Christopher L. Cagan, director of research and analytics for First American Real Estate Solutions, examined historical housing price movements and concluded that middle America markets like Columbus (OH), Indianapolis (IN), Houston (TX), San Antonio (TX), Memphis (TN), Atlanta (GA), Cincinnati (OH), Des Moines (IA) and Louisville (KY) are due for above-average price increases and home building because of expanding employment bases and moderate housing prices. Cagan also doesn’t believe what he calls the shooting stars of housing booms like most of California, Florida, Washington, D.C., New York City, or Boston are going to incinerate. He simply believes appreciation rates will dwindle to the low single digits or go flat for awhile as incomes catch up.

This is precisely what we heard at a Broker's forum a the Mid Year Conferences hosted by The National Association of REALTORS a couple of weeks ago. Time to buy in Middle America!

Chris

Second Home Trends from NAR

Hi everyone,

I attended the National Association or REALTORS (NAR) Mid Year Meetings and Expo in Washington DC last week. In addition to taking classes toward a Certified International Property Specialist(CIPS), I sat in on the annual meeting of the newest specialty offered by our association: Resort and Second Home Property Specialist (RSPS). In that meeting, I learned about the trends we need to recognize and support with the investment style of Baby Boomers. Anyway, the following article from Realty Times is a great synopsis of these trends from the NAR, and I find it all very important...

New NAR Survey Reveals Motivations Of Second-home Owners
By Blanche Evans
May 15, 2006

It's important for the real estate industry to understand what motivates homebuyers and sellers which is why the National Association of Realtors has worked hard in recent years to understand the differences between types of homeowners, including those who buy more than one property. To help its members obtain more insight into clients and their needs, and thereby improve their services to those clients, NAR has heavily researched the phenomenon of second-home owners.

According to the preface of the 2006 National Association of Realtors Profile of Second-Home Owners, second-home owners are defined as those who "own one or more residential properties, in addition to a primary residence, and who use these properties either for vacation or investment purposes. Although both types of properties share several attributes, vacation homes are properties owned primarily for recreational use by the owner or their family, while investment properties are owned primarily to rent to others."

Ownership of more than one home is increasingly common, notes NAR, due to peak earnings of the baby boomer segment of the population, less-than-stellar returns in other financial assets other than real estate, and popular tax incentives (including capital gains exclusions) and loan programs that favor buying property over other investment instruments. For example, between 2000 and 2005, the value of homes nationwide rose over 50 percent, while the Standard & Poor's 500 Index returned just over 2 percent for the same period, says NAR.Older baby boomers dominate the second-home market as vacation-home owners (age 59) and investors (age 55) and most own multiple properties. About six in ten survey respondents own two or more homes in addition to their primary residence.

Observes David Lereah, NAR's chief economist, "Boomers believe in diversifying their assets, and most second-home owners see their purchase as being a better investment than stocks. A surprising majority of survey respondents hold multiple properties, and they are interested in purchasing additional homes."While the U.S. Census Bureau data shows there are 6.8 million vacation homes in the United States and 37.4 million investment units in addition to 74.6 million owner-occupied units, the line appears to be blurring between how owners define themselves:Twenty-one percent of vacation-home owners own two or more vacation homes. In addition, 34 percent of vacation-home owners report they own two or more investment properties.

Lifestyle figures prominently in their choices with half of vacation homes located in resort areas near water or sports features. Distance is about 220 miles; most owners say they drive to their vacation homes. Most homes were in the $300,000 range, less than the value of their primary residence.More than half of investment property owners, 53 percent, own two or more investment homes and 12 percent own two or more vacation homes.Financial gain is the motivator, with most rental properties chosen to generate income and within easy access -- 10 miles. Most homes were in the $200,000 range, lower than the investor's primary residence."We've always known that a certain segment has invested heavily in the rental market, and some people earn their living simply by holding and managing investment property. What we see now is a crossover between largely vacation- and investment-home owners, with people recognizing the value of those investments and pouring more assets into real estate," says Tom Stevens, president of NAR.

Since 2003, two-thirds of second homes have been purchased through a real estate agent, while over four out of five primary homes are purchased using an agent. Thirty-two percent of all vacation-home owners and 24 percent of investment owners paid cash for their property. Combined with mortgages that have been paid-off, 82 percent of vacation homes and 75 percent of investment properties are owned free and clear. Of owners who purchased with a mortgage, the median downpayment on a vacation home was 27 percent and the median downpayment for an investment home was 23 percent.

When asked about the source of downpayment funds for more recent vacation-home owners with loans, who purchased since 2003, half said savings, 23 percent from the sale of other real estate, and 19 percent identified equity or sales proceeds from their primary residence.For more recent investment owners who purchased with mortgages, half said downpayment funds came from savings, 28 percent from equity or sales proceeds of their primary residence, and 18 percent from the sale of other real estate. Surprisingly, considering that one in three buyers in 2004 and many more were second-home buyers in 2005, that the most recent property was purchased a median of six years ago. Most second-home buyers have held additional properties for longer periods.Some believe investors are fleeing the marketplace, that may apply to speculators, but not for buy-and-hold investors. Thirty-five percent of all investment-home owners said they were planning to buy another home within two years. For those who currently own four or more investment units, 64 percent said they planned to buy another property within two years, and 17 percent said they planned to purchase five or more additional properties. Under a third said they planned to sell a property within the next two years.
Copyright © 2006 Realty Times. All Rights Reserved.

Adjusting Market Trends

Just saw this on RealTrends report..."Across the U.S., home prices are falling, with many metropolitan areas expected to see large reductions, according to a report on CNNMoney.com. The city that may see the biggest drop is Las Vegas, where prices are predicted to decrease by 8.2 percent this year, the Web site says. What's in the cards for your local market?

Check out www.CNNMoney.com's forecast for 379 cities across the U.S. While the outlook is grim for many of the housing boom's best performers -- places like New York, Los Angeles and Washington, D.C. -- the future looks bright for several cities that missed out on the action, the Web site says. Among the markets the article reports are on the way up: Houston, Memphis and Rochester (NY). "

We are experiencing a definite adjustment in Southern Maryland, but still hope to stay ahead of the curve on the 'Washington DC market'. There are still people buying and selling, and there will be continued attraction to our market based upon the lifestyle. I'm off to an appointment to show waterfront in 10 minutes...wish me luck!

That's all Folks! Chris