Entries from November 2007 ↓

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According to Compete.com internet traffic for October, 2007 is up 24.3 percent over October, 2006.

So when the sellers tell you that they want their ego listing in the local paper, show them this stat and put that hundred dollars or so into a custom landing page for the home. That will really impress the seller and actually help sell the home!

If you have projects around the home that need lumber then the new construction slowdown is working in your favor. Lumber manufacturers are facing an inventory glut as the housing slowdown in the United States has significantly reduced the demand for construction lumber.

So it looks like a great time to replace the lumber in our 18 year old deck!

Most analysts do not expect what has been called the worst U.S. housing slump since World War II to bottom out until at least mid-2008. Once a bottom is reached in housing, lumber demand could still remain dull for months.
“You’ve got very weak demand and just a pile of inventory (of homes on the market) to get through before you can get demand for the underlying lumber to pick up down the road,” said Paul Quinn, a paper and forest products analyst at Vancouver-based Salman Partners. “That’s why 2008 is going to be very similar to 2007.”
Lumber prices have eroded this year in tandem with slowing demand from home builders and it is difficult to gauge how far prices will fall with no end in sight for the housing slump. via  Reuters.

As demand has slowed down and the Federal Reserve is lowering interest rates fueled by slower growth in the national economy, mortgage interest rates are dropping. This week they hit a 2 year low. This is great news for home sellers as the affordability of homes is increasing with the lower payments providing more incentive for potential buyers to take action.

U.S. 30-year mortgage rates dropped to an average of 6.10 percent this week, their lowest level since the week ended Oct. 13, 2005, when they averaged 6.03 percent.
Fifteen-year mortgage rates declined to their lowest level in more than a year, falling to 5.73 percent from 5.83 percent last week. It was the lowest rate since the week ended Jan. 26, 2006, when the 15-year averaged 5.70 percent.
One-year adjustable rate mortgages rose slightly to an average of 5.43 percent from 5.42 percent in the prior week. Reuters.

Unfortunately getting onto MTV’s Cribs show will not cost 50 cents, you have to be the rap star 50 Cent to get your home previewed before hitting the market on this popular television show.

The rapper 50 Cent is about to put the Farminton, Connecticut home he purchased from Mike Tyson on the market for 18.5 million give or take 50 cents (sorry, could not resist).

The 48,000 square foot home will be previewed on MTV before sale proving that video can help sell homes, if done right.

Now, 50’s stamp is imprinted all over the massive 19-bedroom property in Farmington, Conn. The mansion now includes a nightclub with a swing dangling from the ceiling for some of his wilder parties.
But those touches may not remain. 50 is selling the property for $18.5 million. And Thursday, he’s showing off the property on a special edition of MTV’s “Cribs” so fans can take a peek before he moves out.

“I like the look of an Architectural Digest,” 50 said of his designing style. “There’s a lot of good living going on, and it ain’t based (on) the actual money that’s being spent, it’s the choices that people make. You don’t have to buy a $50 million home to build a lifestyle that’s equivalent.” via  AccessAtlanta.

Hey Real Estate agents and brokers, are you still having trouble kicking the newspaper advertising habit. Well, don’t be the last one throwing money into dark, grainy pictures and smudged type. It looks from the new numbers released that many are fleeing the newsprint to online.

So if your boss thinks that putting ads in the local papers is still necessary or your customers are begging you to ego list their homes in the paper, here is more ammunition for you.

Total advertising expenditures at newspaper companies were $10.9 billion for the third quarter of 2007, a 7.4% decrease from the same period a year earlier. Spending for print ads in newspapers totaled $10.1 billion, down 9% compared with the third quarter of 2006.

Among the major print components in the third quarter, classified advertising fell 17% to $3.4 billion. Retail declined 4.9% to $5.1 billion, and national was down 2.5%, coming in at $1.7 billion. via Marketing Vox

Meanwhile online advertising in the newspaper industry is growing by double digits.

You make the call.

Well, it looks like the housing slowdown has taken another victim. The royal Prince Bandar of Saudi Arabia has pulled his 135 million dollar Aspen estate off of the market due to not receiving a good enough offer. The family decided that they liked the home too much to part with it after not getting a good enough offer.

Darn those low ballers!

“The ranch is off the market and is no longer for sale,” said William Jordan III, an Aspen attorney who represents Bandar’s local interests. “Prince Bandar and his family realized that they enjoyed the ranch, and Aspen, too much to want to part with it.”

Aspen real estate broker Joshua Saslove, who listed the house known as Hala Ranch for sale in July 2006, said there was “enormous interest” in Prince Bandar’s home, which sits on 90 acres in the gated Starwood neighborhood just outside of Aspen.

“However,” Saslove said, “none of the interested parties wrote a contract that was acceptable to the seller.”  Aspen Daily News

This has been a target of mine so I will continue to beat the drums. There must be an easy way for borrowers to reach their lenders when facing foreclosure issues.

How can the mortgage holders be so out of touch with their borrowers when the costs are so high. With the recovery rate at only 68 cents on the dollar it is mindboggling that borrowers can not get in touch with their lenders when facing a problem with their payments!

The costs are so incredibly high on either end of the transaction that no one can possibly win.

The unexpected consequences of the subprime meltdown and current credit crisis is that the removal of the human element in lending saves significant costs at the origination of the loan with a huge downside when things turn sour.

The Daily Herald has more on this story today:

When a homeowner faces loan default, their problems are exacerbated when they can’t get through on the phone to talk with someone or are shuffled among departments.
“When a homeowner gets a foreclosure notice and calls up, they often get layer after layer of what button to press and then music when they’re on hold,” said Steven Bashaw, a Lisle attorney specializing in foreclosure and real estate matters. “Ask anyone who’s done that. They’ll be placed on hold and wait, and they’ll wait and they’ll wait. Then it’s five minutes to five o’clock, and they’ll say they can’t get anyone today, call again tomorrow. I hear that constantly.”
Mortgage companies and banks have been under pressure to please shareholders while curbing the defaults. Still the numbers of foreclosures continue to rise. via the Daily Herald

If you are having difficulty selling your home it may be that you are not offering enough perks. That is the thoughts of this novel campaign by To Go Chefs that they are rolling out to the real estate industry. To generate buzz for your homes they have a plan to offer the services of a personal chef for a year with the purchase of a home.

While this seems crazy on my first impression it could be a deal maker for the high end home that a dual income family would be interested in buying. Many people have thought that they could use a personal chef in todays hectic world but think that it is too ostentatious to have, but if it came with the house, who can say no.

Home sellers and real estate professionals are now partnering with To Go Chefs International to offer potential home buyers a personal chef for one year to be included in the asking price of the home.
“By supplying our chef service to potential home buyers, you will achieve the goal of making your home more appealing to buyers,” said Brent Butler, account manager for To Go Chefs International. “I am fairly certain that no other home on the market will come with a personal chef.” via PR Web

If you have a new and unique way to market a home we would love to hear it. Just leave a comment and we will be in touch.

Tags: personal+chef

Top Private Mortgage Insurers are starting to feel the pinch from the recent spate of defaults in the mortgage industry. Companies such as MGIC are losing money as payouts surge and do not expect to see profitability until 2009.

While it will be a tougher road for the PMI companies, this is the role that they play in the industry. They allow banks to make loans at a higher level than their regulators would normally approve with the understanding that private mortgage insurance will shoulder the load when loans go bad.

And homeowners have the knowledge that this insurance in place if problems occur in their world. Now is just the time the piper gets paid.

If the insurers do run into trouble, the risks for the industry are huge. About 10 percent of the total loan market has private mortgage insurance, according to the Mortgage Insurance Companies of America. There was $776 billion in private mortgage insurance in force as of September, the trade group reported.
MGIC, which has $196.6 billion in policies written, is confident it can pay even though it figures it won’t return to profitability until at least 2009. So far this year, MGIC has paid out $586 million in claims and expects to pay out $875 million for the full year.
Next year, claim payouts are expected to rise to between $1.2 billion and $1.5 billion, roughly doubling the $611 million paid in losses in 2006.
”These are big numbers,” said Michael Zimmerman, vice president of investor relations. ”Obviously we’ll pay out large numbers, but we’re receiving money at the same time. We don’t anticipate losing a billion dollars.” via SearchChicago

Tags: PMI

This is why we are all feeling a pinch.

Click image to view full size.

via USA Today