http://www.articletrader.com/ Articles at ArticleTrader en-us http://www.articletrader.com/finance/real-estate/subprime-woes-are-we-out-of-the-woods-yet.html http://www.articletrader.com/finance/real-estate/subprime-woes-are-we-out-of-the-woods-yet.html Sat, 26 Jan 2008 00:00:00 -0600
First, the Bush tax break: $300 per household, allowing up to $1,200 if you have four children. Due to Democratic pressuring, the rebates even go to poor people who can't pay taxes (re: sub-prime mortgage holders). And because Republicans need something for their constituency as well, the rebates are good for couples with income up to $150,000 a year (so that their spending will trickle down into the greater economy, thus providing enormous benefit to all related industries). This represents a meager sum when compared to the average mortgage payment, which on sub-prime loans tends to roughly double once the adjustable rate kicks in. Moreover, the deficit is sure to be off the charts next year as a result of what amounts to pulling money out of thin air.

Now for the Federal Reserve cut. While it took most everyone by surprise, it didn't keep the Dow from ending down %1 the day it was announced (Jan. 22nd). While the stock market made substantial gains over the next couple of days, volatility is the name of the game these days, and cutting the interest rate cut so suddenly on the heels of MLK Day's depressing Asian market performance looked to many like a panic move. The Fed have the unenviable task of attempting to appear composed when they may not always be, and minimizing the impression that they aren't responsive to falling consumer confidence. As no other central bank saw fit to act in concert with the Fed, (save Canada, whose meeting was scheduled and whose cut was a mere quarter-point) many analysts speculate that their motives are driven by short-term need for stability in financial markets, and less by the still-ominous sub-prime threat.

Finally, the bond insurance bailout. If it weren't for this action, few would doubt that the US is headed for imminent recession of a particularly painful variety. But if the mechanics of the financial system, much of which depends on companies being able to confidently lend money (insured with solid capital) to one another, is allowed to grind to a halt? The sub-prime crisis would pale in comparison to the amount of profits that would instantly be lost, which some speculate would be in the hundreds of billions. This is clearly unacceptable, but an inherent danger still exists: Without the course correction on housing prices (and the debt which was transferred to major banks, and then to their, we may be doomed to something similar to the Japanese housing bubble of the 1990's wherein bank managers actively colluded with policy makers to obscure their collateralized debts in a similar fashion to the structured investment vehicles of today's credit crunch.

Taken together, these factors would probably lessen a recession if it were impending. But unless people are able to get more credit, exacerbating existing problems, the downturn the US is now experiencing will likely be long and harsh. The kinks have to be worked out, and the unfortunate aspect of this reality is that those who have the least must pay the most.

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Escapeso is an Austin realty company. Their site is filled with information about Austin real estate along with a free search of the Austin MLS.

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/is-the-superfund-capable-of-restoring-confidence.html http://www.articletrader.com/finance/real-estate/is-the-superfund-capable-of-restoring-confidence.html Mon, 10 Dec 2007 00:00:00 -0600
In order to avoid such an outcome, this superfund aims to selectively buy large number of securites from what is called Structured Investment Vehicles- or SIV's, which sell so-called "commercial paper" to finance themselves. Commercial paper is sold at most of what it is worth and matures quickly (over a period of months rather than years) which, although a risky investment (because it has a smaller percentage of the investment reserved in case of a drop in value), means it can quickly be converted into a more stable form, most often in a money market fund. Bond rating institutions rated the money market funds as being much safer than they actually were, because SIV's transfer the securities through commercial paper before they make their way to the stable funds.

Since it became more apparent that these small conduits only appeared to be trustworthy investments, they have lost popularity and have few potential buyers. Although this is not inherently bad, it reflects two scenarios. The first possibility is that the market is functioning improperly due mostly to a loss of investment confidence, which depends on the perception of the average investor that the economy is stable and therefore worth investing in. The other possibility is that the economy is unstable due to real underlying debts that cannot be avoided, and therefore this new conduit is just a smokescreen for the big banks to pay lip service for making so many bad loans in the first place.

The second scenario is unfortunately the more likely one, which means a recession could be unavoidable. The reason the conduit functions ineffectively is twofold: because it depends on the bank's promises that they will buy the SIV's assets even if no one else will, thus placing an artificial incentive in place for investors, and because the bank's guarantee is also dependent on their securities maintaining a certain amount of their value. This means that the financial institutions can take fees from the securities in exchange for an incomplete guarantee, thus justifying their purchase. The fund could theoretically have a positive impact, if willful suspension of disbelief takes hold of the globe, or if you view a slowdown in the US economy as a positive outcome.

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Living in Austin, Texas Ki works to help clients interested in the Austin real estate market. If you are looking for a home in Austin his site provides a search of the Austin MLS along with more general information on his Austin Real Estate Blog.

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/finding-the-right-neighborhood.html http://www.articletrader.com/finance/real-estate/finding-the-right-neighborhood.html Sat, 22 Sep 2007 00:00:00 -0500
So, how do you evaluate your needs? Begin by asking yourself some important questions about your current lifestyle and your future, desired living conditions. A summary of the answers to these questions will help you determine where you might want to live in this community and why. Remember, this is the time to decide what your criteria will be for evaluating and shopping for the right Neighborhood for you. Make a list, prioritize, and discuss this with your real estate agent.

The following are some questions you may want to consider as you look at the neighborhood in general: Are schools important? Do you need to be near shopping centers? How close do you need to be to your place of work? Is public transit necessary? How much are the school and property taxes? What about resale value? What is the history of home values for this section of town? What are some of the projections for growth or new developments in the area? What kind of neighbors do you want to live near? What are the things that are most important for you? Once you have defined the criteria for selecting a neighborhood take the next step and look at the homes within the pre-selected areas. How do they fit with the home you want?

To answer this question, you may first have to determine what style home will you enjoy? Is land important? Do you want a large lot or a very small yard? Is a pool important? What about landscaping? Do you want a single floor or multistory house? Once you determine the answer to this question set, then you must decide if the houses in the selected neighborhood match your preference for a home.

As you can see, the selection of the right neighborhood involves a lot of careful thought and consideration of a wide variety of questions. Since good realtors are familiar with all areas in the community, your real estate agent can be very helpful. They can supply you with information about taxes, values, future developments, history of home sales, school systems, and many other important data sets and facts. As we have discussed, there are many factors to consider when finding the right neighborhood. Careful consideration and planning will reap satisfaction and success in the selection of your future neighborhood.



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Located in central Texas Austin Real Estate and Properties works to provide their customers with honest and experienced advice. Their website allows clients to search the Austin MLS along with a Mortgage Calculator


Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/the-benefits-of-a-gfe-and-pre-approval.html http://www.articletrader.com/finance/real-estate/the-benefits-of-a-gfe-and-pre-approval.html Sun, 02 Sep 2007 00:00:00 -0500
For one, by discussing your debt to income ratio with your lender and obtaining the GFE, you can determine your maximum price. It helps to know the maximum sales price when shopping around so that you do not waste time and energy looking a over-priced properties, and also vice verse, you do not waste time and energy looking at under-priced properties. You can find an area in your price range that fits your needs and narrow down your search. You also will determine your monthly payments with the GFE. The monthly payments should include the property taxes, insurance, principle, and interest plus any private mortgage insurance (PMI). If the monthly payments are higher than you wanted, then you can adjust your sales price to be lower.

Another reason to get your pre-approval and GFE before starting your home search is that you may find out some issues with your credit or financial situation that you could clean up before moving forward with a purchase. For example, the first time I bought a house, I found out that I had a $50 charge on my credit report from 3 years ago, which brought my credit score down. And with a lower credit score, I would have gotten a worse interest rate on the loan. I say 'would have' because I was able to pay off this collection and clear up the ding on my credit before going into the loan underwriting process.

Finally, by getting a pre-approval letter, you have proof for a seller that a lender has confidence in being able to fund the purchase on your behalf. This helps with presenting offers and negotiating. Many sellers will not even accept an offer unless it is accompanied by a lender's letter. Furthermore, if you do not have a letter, the seller may counter higher given that he feels he is taking on more risk that you may not be qualified for the loan amount. Also, if you happen to get into a multiple offer situation, your offer will be much stronger with a pre-approval letter.


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Ki works in the Austin Texas Real Estate market. His website provides a free search of the Austin MLS along with a search for Downtown Austin Condos


Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/what-to-look-for-in-a-loan-part-1.html http://www.articletrader.com/finance/real-estate/what-to-look-for-in-a-loan-part-1.html Sun, 02 Sep 2007 00:00:00 -0500
1. Down Payment:
In general, the more you can put down, the better interest rate you can get. There is a point at which it does not matter how much more you put down, and that point is usually either 20% or 30%, depending on the loan program. If you are looking for the best rate possible and can put down more, ask your lender about this option.

2. Loan Life:
The longer the term, the more total interest you will pay. This is partly because you will have a better interest rate with the 15 year; for instance, today's rate from a large bank is 6.375% for a 15 year and 6.75% for a 30 year. The other reason you pay less interest over the life of the loan with a 15 year term is because you pay down your principle faster. Instead of getting a shorter life term on the loan up front, another option to pay less total interest is to pay more into your mortgage each month to pay the loan down quicker. For example, on a 30-year $240,000 loan at 6.5%, if you pay $272 more per month, you can end up paying the loan off in 15 years instead of 30.

3. Property Taxes:
When comparing lenders, this number should not vary because your property taxes are paid to the city, county, and state, not the lender. So, this number should be constant across all lenders. But, when you look at estimated payments from different lenders, the estimated taxes will vary because it is their best guesses at what the tax bill will be at the end of the year. The easiest way to compare the lenders is to just compare the principal plus interest and add in the same number for taxes. Essentially, you are standarizing the estimated payments between the lenders so that you can compare the actual rates. Another way of doing this comparison is to ignore the estimated payments and rather concentrate on the actual interest rate they are quoting you.

4. Insurance Rate:
Again, the insurance is an estimate that the lenders will make. They may estimate differently, so be sure to normalize this number across all the estimated payments.


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If you are looking for a home in the Austin Real Estate market Ki can help you in your search. Their site offers users a free search of the Austin MLS.



Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/selling-your-home-making-your-home-accessible-and-a-pleasant-showing-experience.html http://www.articletrader.com/finance/real-estate/selling-your-home-making-your-home-accessible-and-a-pleasant-showing-experience.html Tue, 14 Aug 2007 00:00:00 -0500
First, try to be inviting to everyone who calls on the house. It is definitely inconvenient for people to be romping through your daily lives, but it is unfortunately part of selling a home. When someone calls to see the home, say something like: "Sure, we were heading to the park, so feel free to look around." Basically, you just want them to feel like they are not bothering you. This just helps set the mood of the home being inviting instead of starting off the showing with a feeling of intrusion.

Another thing is to try to leave when potential Buyers are being shown the home. Buyers just do not feel comfortable if someone is there, and they usually rush through the home without spending some time looking at where their furniture will go or how big the closets are. In addition, if you have dogs or animals that would be distracting during the showing experience (i.e. barking or jumping), try to take them with you, or if you are at work, keep them in the backyard. Basically, let the Buyer concentrate on your home.

Also, don't give a personal tour of your home. It is hard to resist since you know the most about your home and want to share that with potential Buyers, but when it comes down to it, you want people to daydream about the overall home being theirs, not concentrate on sink faucets. You want the people to become interested in your home on a personal level, thinking of how they will go about their daily lives in your home rather than notice every detail. Noticing every detail will come later.

Also, ask your listing agent to list your house with the easiest showing instructions so that your home is accessible without much effort. Sometimes Sellers will need to make appointments due to certain situations like the elderly or newborns. But if possible, have the Buyers phone / leave a message and head to the home. Our MLS system calls it "Call 1st - Go". This makes it possible for anyone to come by, even if they were just driving by and admiring the home. You may not get much notice, but it allows these sudden-interest people to come in, and the more people that come through will give you more a chance sell it.

Talking about short notice, try to keep your home as clean as possible at all times. Many Buyers will say that they can imagine beyond a mess, but most cannot. Messy homes end up being distracting from what the home is offering. It is definitely hard to keep a model home look while trying to live in it, but it helps sell the home. And if you keep it consistently clean, then when a Buyer ends up wanting to come with short notice, you will be ready.

Also, do not use combo locks, if possible. Phoning for the combination is an extra step that may prevent the showing if the person with the combo is not available. Most MLS systems have electronic lockboxes available, which make access easy and have the added plus of logging in each agent that comes. Of course, if electronic lockboxes are not available in your area then combo locks are a good alternative to trying to arrange appointments.

The last thing is to never say no to someone requesting a showing. It can definitely be hard to prepare when someone wants to see your home, especially when you have little notice. This again is where being prepared and tidy at all times is helpful. Have a game plan prepared, especially if you have kids or animals. Many people decide to take their dog on a walk because it us a quick exit and lets the Buyers have a little time in the home to look around.

In summary, you want as many people looking at your home as possible and the showing experience to be as comfortable for the Buyers as possible. So, try to make the showing access as easy as possible and keep distractions (like animals, messiness, & even yourself) to a minimum.

Escapeso Austin Real Estate is a website by a husband and wife team working in the Austin Real Estate Market.

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Austin Homes created their website to allow users to search the Austin MLS

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/what-green-building-means.html http://www.articletrader.com/finance/real-estate/what-green-building-means.html Tue, 14 Aug 2007 00:00:00 -0500
Insulation and Building:
Many new buildings are being insulated with recycled materials, such as old blue jeans or blown-in fiberglass. Proper insulation now goes a long way toward saving on energy bills later. Walls can be made of steel and concrete, rather than more expensive and volatile treated wood. Many cities have lumber yards and "re-stores" where you can buy recycled or left over building materials that are strong, cheap, and often antique or authentically vintage.

Appliances:
Look for low flow shower heads and low flush or composting toilets. Consider energy saving washers and dryers, or put a line in your yard to hang wet clothes on sunny days Make sure your HVAC unit is sealed and clean, and look for gas stoves and instantaneous, or tankless, water heaters.

Flooring:
Rather than use expensive hardwoods that endanger the land and deplete forests, many real estate builders have found inexpensive and beautiful alternatives in bamboo (which is technically not a wood but a grass, and yet one of the hardest and most easily replenished flooring materials) and cork (also easily replenished). Concrete, too, can be a sturdy and inexpensive alternative, as can old fashioned linoleum, which is actually made from linen and other natural fibers.

Paint and Other Materials:
Many paint manufacturers are looking for green alternatives to oil and latex; one such option is the use of milk-based paints (which upon application smell like milk instead of harsh chemicals, and which don't have any carcinogenic ingredients.) Recycled glass is now being made into kitchen and bath tiles, and countertops are being made with recycled materials that look even more beautiful and unique than mined granite.

Solar Energy:
Solar energy doesn't just mean expensive panels that sit on your roof (though that's one kind, called active solar energy). Considering a solar home can mean investing in thick-paned, glazed windows or in more complicated photovoltaic cells. Though solar tends to be an expensive investment, upfront, the rewards show up every month in your energy bills.

Landscaping:
Look for Xeriscaped yards and common areas with plants that require little watering. Consider getting rain barrels (many cities sell them through their water and energy programs) or converting your outdoor water system to "graywater" (which involves using recycled water from dishwashers and washing machines to water your lawn or wash your car). Looks for trees that are native to your area, and plant them so they shield your windows from too much sun during hotter days.

Neighborhood:
While a lot of green building means being aware of what is going into your home, you might also want to check out your neighborhood. Are there recycling programs or community gardens? Public transportation? Bike paths so you can have the option of avoiding traffic? Are there shops and restaurants close to you, to encourage walking? While thinking about these things may seem unimportant now, our global climate and community with thank you later. (Oh, and don't forget the federal tax deductions.)


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If you are looking for property in the Austin Real Estate market, Ki Gray can help you in your search. His site Escapeso Austin Texas Real Estate is a source for information about the real estate market and current events in Austin Texas. He also has information on his Austin Real Estate Blog .

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/what-to-look-for-in-a-condo-conversion.html http://www.articletrader.com/finance/real-estate/what-to-look-for-in-a-condo-conversion.html Tue, 14 Aug 2007 00:00:00 -0500
1) Common Space
Many apartment complexes are designed for working people who commute—students who come home at night for school, dayshift employees who return to their rented one-
bedroom in the evenings—thus many apartment areas don’t have a well kept common area. If you buy a condo conversion, think about how much time you’ll be spending there, and consider looking for one with some green space or a pool.

2) HOA Fees
Because oftentimes a lot of money goes into a condo conversion, the monthly condo fees can be substantial. Read the fine print to make sure the fees won’t go up too high, and try and find out whether your fellow owners have similar interests to yours.

3) Amenities
Look closely at the details of your potential purchase. Are the walls thick enough between units, since condo dwellers often have a different lifestyle than people who live in less permanent apartment complexes? Are there washer/dryer hook ups in each unit, or is there a shared laundry facility? Are there still renters in the complex, or most units owner-occupied? Are the appliances brand new or have they been used by previous tenants?

4) Renovations
If you’re going to buy a renovated apartment, try and make sure the renovations have been true improvements. Many complexes use a lot of energy and water, so you might want to check if they have been updated in a green fashion—check for energy efficient windows and appliances, a standardized recycling program, low-flush toilets and good insulation. Because of the trend in green building that’s sweeping the country, it’ll make your property more valuable in the long run if you pay attention to those features now.

If you are looking to move to the Austin real estate market Ki Gray can help you find a property. Ki works for Austin Real Estate as a realtor in Austin Texas. Their website offers a description of the various Austin Condos going up in downtown Austin.


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If you are interested in purchasing properties in the Austin Real Estate Market Ki Gray can help you locate the property you are looking for. Their website provides descriptions of the different Austin Condos being built in downtown Austin.

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/top-8-things-to-avoid-in-the-real-estate-agent-you-choose-to-list-your-home.html http://www.articletrader.com/finance/real-estate/top-8-things-to-avoid-in-the-real-estate-agent-you-choose-to-list-your-home.html Tue, 14 Aug 2007 00:00:00 -0500
2 *Agents that make it more difficult to show their listings. In most states agents, can put a lockbox on a house. Some agents in these states will put in the listing that you have to make an appointment with the listing agent. Since the buyer's agent has to call and make appointment instead of just showing the listing, this dramatically cuts down on the number of showings these sellers receive.

3 *Agents that only work as real estate agents occasionally. While it seems like a good idea to use your brother's friend that has sold 3 houses in the last 5 years, it's probably not. These agents don't know the market as well as a full time agent. Additionally, they don't understand what is typical in a real estate transaction in your region and an experienced buyer's agent can use this to their client's advantage at your expense. If you were going in for a root canal you would not want to use a dentist that has only seen 3 patients in the last 5 years. In the same way, you don't want to hand over the sale of your largest asset to someone that is inexperienced.

4 *Agents that are so desperate they try and steal clients away from every agent that shows the house. While this is rarely successful, it does make an agent think twice before showing the listing to another client knowing there is a hungry vulture waiting there for them.

5 *Agents that don't work on the weekends. Real Estate is a 7 days a week business. If your agent is not answering the phone on the weekends, you can expect that the number of showings you will receive is going to be cut down. Sometimes buyers are in from out of state for the weekend and are planning on making an offer while they are in town. They usually narrow it down to two or three properties. While your agent does not return calls about your property over the weekend, the listing agent for the other property probably will answer the buyer's questions about their client's property. When it comes time to make an offer, the buyer is going to make an offer on the house they know more about and feel more comfortable with.

6 *Agents that have a bizarre set of rules that is atypical for the industry. This can come in many forms. Some agents want all correspondence with them to be done by fax instead of telephone or email. If the option fee is usually $100 and your agent is demanding $500 you can expect that their eccentric rules is turning away potential buyers. Being eccentric is great with art, but in a real estate transaction, it usually makes people wary.

7 *Agents that don't take photos of your property. There is no good excuse for not taking photos of your property. If your agent is only going to take 1 or worse 0 photos, it's time to find a new agent.

8 *Agents that don't have a website. As real estate has become more of a business based on technology, with buyers looking online for houses, and more of the real estate transaction taking place through email, you want your agent to be operating in the 21st century. If your agent doesn't have a website it's a good sign that they are still practicing real estate in the age of dinosaurs.


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Ki Gray lives and works in Austin Texas. Working as a realtor in the Austin Texas Real Estate market. Escapeso Austin Texas Real Estate is dedicated to providing its clients with honest and experienced advice when they are looking to purchase in the Austin market. If you are looking for one of the new downtown Austin Condos or an older home they can help you in your search.

Source: http://www.articletrader.com ]]> http://www.articletrader.com/finance/real-estate/now-is-not-a-good-or-bad-time-to-buy-real-estate.html http://www.articletrader.com/finance/real-estate/now-is-not-a-good-or-bad-time-to-buy-real-estate.html Tue, 14 Aug 2007 00:00:00 -0500
Don’t get me wrong - if you’re buying a property and plan to flip it in a few months, then the current direction of the market is very relevant.  But if you’re buying a house to live in its less important.

Ok, wait—let me explain that.  I’ve been in real estate a long time, and have made a decent amount of money buying and selling properties.  But whether the market is going up or down, I continue to buy and sell properties.  Regardless of whether the market is hot or cold, it's going to change at some point in the future.  A "hot" market will cool down.  A "cool" market will heat up. 

Sure, it would be helpful to know the exact time a market will turn.  Indeed, there are a lot of people that say they know exactly when the market will turn.  They're all 100% sure, but no one agrees. Because it's impossible to be "100% sure." Simply knowing that the market will change in the future doesn't give you a competitive advantage, anyway.  It's like saying it will rain at some point in the future - it’s true, but it doesn’t help you know when to bring an umbrella. 

Lets look at an example.  I have a friend in California.  We talked about the fundamental problems with the California market, like lax regulation enforcement.  He told me he was happy that he hadn’t purchased a specific property recently, because he knew the market was going to tank.  So we talked about the property.  It turns out that the property he almost purchased at the time was worth 350k.  It eventually rose in value to 800k at the peak.  Today it’s worth 740k.  (Oops.)

My point is that knowing the market will eventually change is not as helpful as knowing when the market will change.  In the last 20 years, the Austin real estate market has gone through many cycles.  Simply knowing that there are more cycles in the future is not helpful. If you are buying a house to live in, its possible you’ll see many hot and cold cycles in the real estate market before you sell your home. 

So what’s important?  When I purchase a property I look at how the appreciation of the neighborhood compares to other neighborhoods in the same city.   I'm not looking for a property that always appreciates.  I’m looking for a property that does better than average in a slow market.  This might mean it depreciates at a slower rate.  I also want a neighborhood that appreciates at a greater rate than average when the market is hot.  While its hard to find anything other than general appreciation rates for a city, a good place to start is a local realtor who knows the market well, and who can tell you how different neighborhoods have performed in the past.

Secondly, I look for properties in what I call "emerging areas."  In the past, I've seen the largest appreciation for properties that were not in stellar neighborhoods, but properties in "rougher" areas that were improving.  Even if the market is currently cool these properties can be purchased relatively cheaply.  And if you wait for the next hot cycle these areas might turn from transitional neighborhoods to the new "hot spot."

While I can't predict when a market will turn, I do look for different things that might affect a neighborhood.  Is there a new strip mine moving into an area?  It might be a good idea to avoid surrounding neighborhoods.  On the other hand, there could be a new development that might increase properties.  For instance, if you hear that an old chemical factory is about to be turned into a mixed-use development with cute little shops and expensive houses, it might be a good idea to look at surrounding neighborhoods.

In summary, it's hard to predict the turns of the real estate market.  But if you do your research on the property you are interested in and the comparative appreciation of your neighborhood, you can ride out the ebbs and flows of the market and come out ahead in the end.

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Ki Gray lives in Austin Texas and works as a realtor and an investor in the Austin Real Estate market.  When Ki is not investigating the properties he enjoys spending time at the local parks that pepper the Austin Landscape.  His company Escapeso Realty offers a free search of the Austin MLS.

Source: http://www.articletrader.com ]]>