Entries from December 2005 ↓

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We present our semi-regular Real Estate Bloggers Roundup today and are expanding it from the typical Bubble Bloggers that we cover regularly. We have found a couple of blogs that are very well written and have become part of my daily reading schedule.

Northern Virginia Real Estate Guide – written by an Oenophile no less – has a discussion on why this is turning into a great time to buy a new home as builders are nervous and providing up front discounts and freebies.

Housing Panic – This site is run by Keith,  an Arizonan who is passionate about the potential bubble arriving. I even saw a press release out there for his site. Now that is promotion! – Keith has an article on the overbuilding of the Condo market and the potential flood of units hitting the market in 2006.

The Boy in the Big Housing Bubble – an excellent site with a great layout – has a post warning about predatory lenders.

The Jersey Shore Real Estate Bubble – Another regional but well written blog – posts on the trickle down affect of how a condo market alone can hurt the whole housing market. A very astute observation.

It looks like we have two factors at  work in this report. We have a slowdown in home sales, and many people  trying to get their homes on the market before any bubble has the  chance to pop.

Sales of existing U.S. homes fell 1.7 percent in November to a 6.97 million unit rate as inventories hit their highest point in more than 19 years, according to trade group data on Thursday showing a cool-down in housing.
November’s sales rate compared with an unrevised 7.09 million unit pace in October and marked the first time the pace of sales has dipped below 7 million units since March, the National Association of Realtors said.
The existing homes figure includes both single-family homes and condominiums. ABC News.

National City Corp has conducted a survey of the most overpriced housing markets in the United States. It looks like parts of Texas have the best buys available, and California and Florida are the communities that are most likely to have a correction.

The 10 markets that are most undervalued include:

National City arrives at its estimates of what the typical house in these markets should cost by examining the town’s population densities, local interest rates, and income levels. It also factors in historical premiums and discounts for each area. via CNN

Celebrity Home Sales – What is more amazing is that they bought a new home with more square footage, albeit no ocean front property, for only 3 million and change.

Don Rickles, king of the insult comedians, and his wife, Barbara, have settled into their new Point Dume home and sold their longtime Malibu Colony residence for just under its $11.5-million asking price.

Their Colony home, with about 80 feet of beachfront, was first listed at $13.5 million in February 2004. The couple had lived in the home since the late ’70s.

Among its features are a 5,000-square-foot main house, a detached guesthouse, a north-south tennis court, a terrace and a pool looking out onto the ocean. The home, built in the early ’70s, has six bedrooms and 7 1/2 bathrooms, a sitting room, fireplace and coastline views. Los Angeles Times.

Rickles is still working in Las Vegas and Atlantic City at the age of 79. Can you imagine sitting at the closing table negotiating with Don Rickles? Yikes… No wonder he got full price. “Look fella, if you do not buy this house, your name will be forever in my act and you will have to go to bed knowing thousands of people will be laughing at you every night! So sign the papers and get this deal done…”

Connect NYC is a real estate technology conference that will take place on January 11 to 13, 2006. The conference will concentrate on how technology and real estate can work together to make the industry more effective.

Rich Barton is the speaker that has everyone buzzing. Rich is the founder of Zillow, a company that has the potential to change the Real Estate structure, much as he did with the travel industry when he founded Expedia.

Speaking of which, Zillow is looking for beta testers. This may be a way to see how the service works immediately.

The traditional real estate commission from a full service brokerage tends to be 6–7 percent.  The  newer  low cost firms have been offering flat fee brokerage services, or an ala carte menu to reduce the costs for the seller. If you do not mind marketing or showing your own home, this may be an alternative for you.

Homeowners can select from an a la carte menu that ranges from traditional full service to flat or greatly reduced fees if owners are willing to shoulder some of the selling load, such as personally showing their home to potential buyers.

Bill Urasky, a broker in the Aurora, Ill., office of Help-U-Sell real estate, says the reduced fee concept has come of age. “Some customers don’t feel they get their money’s worth in a traditional real estate company,” says Urasky. “Do they (real estate firms) do anything else different from us? The answer is no.”

His Help-U-Sell office charges sellers a flat $2,950 fee to sell a home. That includes placing the home on the local Multiple Listing Service, the typical “For Sale” sign in the yard, and negotiations with buyers. From there, owners can pay an added fee for the Help-U-Sell Realtor to handle all facets of the process, including showing the home during open houses or additional advertising.

Sellers can opt to show the home themselves, although Help-U-Sell follows up with all interested would-be purchasers.

Commission savings can be substantial. In a typical 6 percent commission real estate transaction on a $200,000 home, the Realtor fee would be $12,000. The $2,950 flat-fee scenario shaves that percentage to 1.47 percent. via Jacksonville.com

That is what the heir to the Southern California Mercedes Dealership decided to do. Take an old 747 and convert it into her house overlooking the Pacific Ocean.

Francie Rehwald wanted her mountainside house to be environmentally friendly and to be “feminine,” to have curves. “I’m a gal,” says the 60-year-old retiree.

Her architect had an idea: Buy a junked 747 and cut it apart. Turn the wings into a roof, the nose into a meditation temple. Use the remaining scrap to build six more buildings, including a barn for rare animals. He made a sketch.

“When I showed it to her in the office, she just started screaming,” recalls the architect, David Hertz of Santa Monica. Ms. Rehwald, whose passions include yoga, organic gardening, meditation, folk art and the Cuban cocktails called mojitos, loved the adventurousness of the design, the feminine shapes and especially the environmental aspect.

“It’s 100% post-consumer waste,” she says. “Isn’t that the coolest?”

As  they are going to be using the whole plane for out buildings, the FAA had a special request.

He says the eight buildings will be scattered across the terraced hillside as if it were a “crash site.” As it happens, the site lies under a jet flight path into Los Angeles International Airport. That concerns the Federal Aviation Administration, which has asked Mr. Hertz to paint special numbers on the wing pieces to alert pilots that Ms. Rehwald’s retreat is not a crashed jumbo jet.

via The  RealEstateJournal.com

It is easy to be  a genius in a strong real estate market. As we watch the market slow down, there are some tricks to remember learned from past slowdowns, as to told by the Boston Herald.

For Buyers:

• For househunters, a down cycle might produce your best buying opportunity in a decade.
• However, many sellers you’ll meet will be in denial about pricing.
• They’ll refuse to believe that they can’t get what their neighbor received last spring for a less-attractive house across the street.
• Walk away from everything but the most soberly priced deals.

After all, you can’t know for sure when the current housing cycle will hit bottom.

For Sellers:

• If you plan to sell a home next year, you’ll need to figure out precisely where your property sits in its own little sub-segment of the market.
• Don’t automatically assume the worst.
• Even in a broad down cycle, counter-currents will help some properties.
• For instance, a relatively modest house might attract more potential buyers than you’d expect.
• That’s because house hunters who’d normally prefer a bigger, better-located place might find themselves priced out of those properties by higher mortgage rates.
• On the other hand, many markets might face a glut of moderately priced condos beginning next year.
• If you absolutely have to sell such a unit in 2006, you might have to take a bath on it.
• You might do better to keep the condo off the market for a few years, renting it out instead.  via The Boston Herald

The famed Plaza Hotel is now offering private residences for sale. The property is offering 1, 2, and 3 bedroom units and Duplex and Triplex Penthouses for sale. Pricing is not set, but if you go into the registration section of the Plaza Residence  website, you can see the approximate pricing for the property.

• 1 Bedroom Residences – approximately 2 million
• 1 Bedroom Residences Park View– approximately 4.5 million
• 1 Bedroom Residences – approximately 3.75 million
• 1 Bedroom Residences Park View– approximately 7.5 million
• 1 Bedroom Residences – approximately 8.5 million
• 1 Bedroom Residences Park View– approximately 9.5 million
• Duplex and Triplex Penthouses: Starting at 15  million,  with rumors of the pricing topping out at 35 million plus.

So if you want a great place to live, and have some significant money to burn, these units will be going on sale in the near future. And send me an invite, it looks amazing.

It looks like new home sales are slowing down.

Sales of new homes plunged in November by the largest amount in nearly 12 years, the most dramatic evidence yet that the booming housing market is starting to cool off.

The Commerce Department reported yesterday that sales of new single-family homes fell by 11.3 percent last month to a seasonally adjusted annual rate of 1.245 million units.

Analysts had been expecting a drop of around 8.7 percent given that sales in October had jumped unexpectedly to a record high. But many said the size of the decline was a clear indication that the five-year boom in housing has peaked.

In addition to the big plunge in sales, the median price of a new home dropped by 4.1 percent from the October level to $225,200. That was up only 0.3 percent from November 2004, representing a marked slowdown from what had been double-digit price gains. AP