General Real Estate Articles

Can't sell, thinking of renting?

2008-10-03T12:59:00.000-07:00

My words in italics. Unable to sell their home in today's market, many consider renting a viable option. It is, if you take the right approach. Consider this couple, "Stephanie Smith couldn't sell her home. Smith, her husband Mike, and their three children moved from Woods Cross, Utah, to Duvall, Wash., in 2007 after Mike was offered a Washington-based job.

In 2005, the Smiths paid $195,000 for their four-bedroom new construction home in Woods Cross and had almost no equity. So, the couple needed to sell the house for at least $250,000 to bring down the monthly payment on their new home in more expensive Duvall.

But in Woods Cross, the housing market turned sour.

"All of a sudden there was a dip," Smith says. "In our neighborhood, most people sold their houses within a week. But suddenly there were a lot of houses for sale and nobody was buying anything."

Because the Smiths couldn't sell the Woods Cross home, they took another tack: They decided to rent out the house and serve as long-distance landlords.

However, the decision to rent created new issues. In the past year, the Smiths have gone through two renters. They barely make enough in rent to cover their Utah mortgage.

Tough spot to be in. I've written previously about the dangers of being to aggressive on rents. You want to be a GOOD VALUE compared to your competition. If you're on the high end in your area, you eliminate the best qualified renters for those with bad credit, job history and criminal records.

The Smiths rely on Mike's brother to do repairs on the home. They hope to sell it -- to either the current renters or to new buyers -- this fall.

But living in two states away makes things more difficult, Smith says.

"I can't see the house, I have no idea what's going on," Smith says. "What does it look like? I can't pop in and just check.

"I'm so far away, there's hardly anything I can do."

Again, tough situation. I would never recommend a long distance rental without property management. Perhaps the Smiths can rely on family, but that is also fraught with complications.

Sell or rent
The Smiths are hardly the only couple to suddenly and unexpectedly become long-distance landlords. When faced with both a relocation and a house that won't sell, some owners decide renting the house is the only option left.

Such a decision should not be taken lightly, experts warn.

While the Smiths haven't faced any disastrous scenarios as landlords, others living thousands of miles away aren't so lucky. Mansion-sized headaches can include destructive tenants, missing rent and eviction notices.
“There are two ways you really get to know someone -- when you marry them and when you rent to them.”

Denny Grimes, a Fort Myers, Fla., real estate agent and real estate columnist for the Fort Myers News-Press, says long-distance landlords must remove the rose-colored glasses and prepare for the realities of turning their home into a rental.

"When people make a decision to rent, most make the mistake of not renting property like a business," Grimes says.

He shares a real estate saying that underscores the challenges facing long-distance landlords.

"There are two ways you really get to know someone -- when you marry them and when you rent to them," Grimes says.

Dale Siegel, a real estate attorney and mortgage broker with Circle Mortgage Group in White Plains, N.Y., agrees that homeowners need to tread carefully before jumping into the landlord business.

"If you plan on renting, make sure you can cover your monthly nut," Siegel says, referring to the cost of principle, interest, taxes, insurance and unexpected repairs.

"If not, how much will renting cost you each month?" Siegel asks.

It's not necessarily a bad idea to own rental property that is cash flow negative. Sometimes it's a good idea, depends on the house, the neighborhood, the market, YOUR INCOME, many factors. You MUST know your market or know someone who does, this person should be experienced and successful as a landlord.

Before deciding to rent out the house, an owner should closely look at the competition's rent and decide whether the market rates are high enough for the owner to break even.

As a landlord, it's hard to over-stress the danger involved in overestimating rents. Been there, done that. NEVER take rental rates provided by sellers at face value. Always demand a three year lease history, with special focus on when rents were last raised. Again, if you don't have experience, find a successful landlord.

In areas glutted with new construction or large-scale developments, it can be hard to generate the level of rent necessary to cover expenses.

High vacancy rates also tend to depress rents. Rental vacancy rates are highest in the U.S. South at 13 percent and lowest in the West at 6.9 percent, according to the Department of Commerce's Census Bureau. The Midwest (10.6 percent) and Northeast (7.4 percent) fall between the two.

In the first half of 2008, SLC's vacancies were just over 5% which is considered "fully rented." This is a great market to own rentals, especially as buyers are less able to get financing. Landlording will likely get better, not worse, in these times.

Still, renting out the house at a rate that doesn't quite cover expenses could be preferable to selling the house at a huge discount, Siegel says.

It's way better than overcharging and getting less than desireable tenants. In my experience, the top three rules of landlording are, find the right tenant, find the right tenant, and, well, you get the idea...

"It might be better than taking a big loss," he says.

Expert help
Homeowners who become long-distance landlords overnight need to follow the basic rules of finding good tenants.

Rather than just renting to anyone, Grimes urges landlords to ask prospective tenants to fill out an application with references who can attest to a tenant's history of paying rent on time.

Grimes also recommends running a credit report on a prospective tenant and using a rental contract that spells out the terms of the rental agreement.

These contracts often are available in state-by-state layman's books available at libraries and bookstores. Laws vary by state, so it's important to choose the appropriate contract.

Including damage clauses and documents that spell out late payment fees (or on-time payment incentives) and eviction procedures can assist the absentee homeowner if trouble arises.

"Don't waive those requirements, thinking it's cheaper in the long run to get somebody in there," Grimes says. "If they're not paying their bills other places, they won't be paying you. Go in with your eyes open."

"If you think finding a tenant is hard," Grimes says, "try getting rid of one."

Long-distance landlords also face some unique challenges. For this reason, owners who are relocating and considering renting out their homes may benefit from consulting with specialists before making any final decisions.

For example, a tax adviser can share how deductions may change as a result of moving out of a primary residence and renting it. Property taxes may increase now that the home is being used as a rental instead of serving as the owner's primary residence.

Homeowners who become landlords also should ask lenders about any new rules that may affect them. Siegel says many lenders recently tightened standards for borrowers who intend to buy a second home while renting out their first property.

In such cases, a lender might do an appraisal of the first house to more accurately gauge whether or not the homeowner is likely to get a decent amount of rent for the property, Siegel says.

Or, the lender may require documented proof of a renter and rental income for the first house before providing mortgage insurance on a second home.

Property management: A solution?
Some long-distance landlords worry about how they'll address day-to-day emergencies when they live so far away. Others don't possess the expertise or stomach for doing landlord duties.

In such situations, Grimes suggests hiring a professional property manager as a practical alternative.

"When the toilet breaks, they get the call," he says.

Professional property management companies screen potential renters, make sure rent arrives on time, perform minor repairs and thoroughly check properties for wear and tear. In exchange, they take 5 percent to 10 percent of gross rent received.

While this can cut into the owner's profit -- or increase the owner's debt if the rent isn't high enough to cover the owner's costs -- it can provide peace of mind, Grimes says.

If your income permits, it may be far better to take a near term loss to get a long term gain. People get rich in real estate due to property APPRECIATION...

"For absentee owners, there's a difference between handling a rental and having boots on the ground," Grimes says.

To preserve value and make sure the front lawn stays sales-ready, homeowners often need someone willing to thoroughly examine the home inside and out.

While neighbors, friends and family may be able to do quick spot-checks, they won't be as invested as someone paid to do so.

And some property management companies are headed by real estate agents, so they can do double-duty when it's time to sell.

Of course, not all property management companies provide high-quality services.

Before choosing a property management company, it's important to ask the right questions. Mark Heppard, president of Mutual Property Management in Farmington, Mich., suggests the following questions.

14 questions to ask a property manager

1. Do you work with the owners of single-family homes or condos? Can you provide references?
2. How do you communicate long-distance (e.g., e-mail, phone, letter) and on which topics?
3. Can I see a sample service agreement, outlining the services provided?
4. Do you handle property staging for rental?
5. How will you advertise my property (e.g., newspaper, Internet)?
6. How do you screen tenants and handle viewings?
7. Do you provide a trust account for security deposits?
8. How do you handle routine maintenance issues? Are your contractors licensed?
9. If a property emergency arises, what procedures are in place to respond quickly?
10. Who drafts and executes the lease documents?
11. What's the procedure to deal with late payments and handle the eviction process?
12. Do your services comply with government regulations?
13. How do you report monthly and year-end accounting?
14. If I decide to sell, do you offer additional services?

"Consider the reputation, accreditations, fees and testimonials of current clients," Heppard says. "If financially doable, the right property management company can save you a tremendous amount of effort, money and heartache."

Best of both worlds?
Sharon Simms, a real estate agent in St. Petersburg, Fla., knows that today's economic environment is tough on those who wish to sell.

So, she offers a potential solution to her clients -- she can place properties on the market for sale and for lease.

"In the MLS listings, we state that the property is listed as both and that the owner will do whichever produces a successful contract first," Simms says.

A lease can either state a fixed purchase price or leave the price open to a future agreement between parties, Simms says. However, a fixed purchase price won't entice many buyers until prices start rising again, as today's homes cost less than last year's.

And even the best agent can't change economic realities, especially for owners who are "upside down" -- meaning they owe more on their house than it's actually worth.

"In most cases, especially if the owner bought the house in 2005 or 2006, they will be losing money on either the sale or the rental," Simms says.

Sign Of The Times

2008-10-01T08:25:00.000-07:00

A sign that things are getting pretty bad, they're painting the dead lawns of foreclosed properties green to help move inventory. Perhaps a sign that we're almost through the worst of it....perhaps?. From the Recordnet, Stockton California.

STOCKTON - A Stockton man sees the growing number of dead brown lawns of foreclosed homes in the area and sees nothing but green.

Nick Terlouw has launched the Greener Grass Co., which amounts to a service in which he sprays dead lawns with a deep green, water-based dye that makes the turf look good enough for a golf course or a professional football stadium.

For between $175 and $225 per yard, Terlouw uses a motor-powered 50-gallon insecticide sprayer designed for treating orchard trees. He waves his magic wand and in broad sweeps, a la painting a house, makes tired, if not expired, turf sit up and sparkle like Shirley Temple.

"Looking good from over here," hollered Chad Lam, a homeowner watching Terlouw spruce up a brown lawn across the street. "I'm glad to see that happen. It gives us all a lift around here."

Terlouw, who formerly had a window-cleaning business, said he got the idea for the new business from football games.

"They paint logos on football fields," he said. "Why can't we do the same for homes?"

He's had about 10 jobs since he started the business six months ago, but he expects to do better this year, with home foreclosures continuing through this year.

The wet season literally puts a damper on business because he can spray only when the turf is thoroughly dry. The commercially available lawn dye needs to dry two hours, but then will last for three to four months, he said.

Terlouw is trying to market his service to real estate agents and property managers. One home-owners association has hired him to spray a couple of dead lawns, he said.

"Honestly, I see a gold mine here."

One of his customers is Dave Harmon, a real-estate agent with Coldwell Banker Grupe, Stockton. He paid Terlouw $200 to spray the front lawn before a weekend open house on a foreclosure house in a relatively upscale development northeast of March and West lanes.

Most asset managers of foreclosure properties wouldn't be interested in covering such a cosmetic improvement to the lawn, Harmon said, so it's coming out of his pocket. He's hoping it will pay off with a sale.

He said he might use the service again and suspects that other agents could be interested as well to help spruce up the curb appeal of some foreclosure properties.

"I would only do it on homes in nice locations where I could attract some attention at an open house," he said. "Homes in a mediocre neighborhood probably won't get much play so far as decorating lawns."

So would this be a matter of disclosure by the seller to any prospective buyer, to wit: the grass that looks great may be, or is, dead?

Harmon said it hadn't crossed his mind that he would need to.

Actually, at the house where Terlouw was spraying Friday, the grass looked exceedingly anemic - perhaps mostly from winter dormancy - but the turf clearly wasn't dead.

After the spraying, the grass had a sparkling appearance and looked not only alive but also lush and thriving. This was so pronounced that the lawn jumped out on the street as too green compared with any other lawns, even the best kept ones, in the neighborhood.

In other words, the grass looked so good as to be suspect.

Paul Tamayo was visiting his daughter down the street from Terlouw's spray job and couldn't help but come over and ask about the service.

"I'm going to talk to my daughter to see if she wants it done," he said. "I mean, that's beautiful."

Bye Bye Booze!??

2008-10-01T07:50:00.000-07:00

Utah first in nation to pull "alco-pops" from stores, gas stations reads a headline in today's Drudgereport... To outsiders who know little about Utah alcohol laws (save for incorrect stereotypes) it may well have been "NO ALCOHOLIC BEVERAGES!" I've already recieved messages from relatives asking, "what is up out there?"

Growing up in the midwest, I know "outsiders" understand virtually nothing about Utah, except that it's populated by Mormons, and you can't get a drink. Whatever your opinion of alcohol, why perpetuate myths with a law of relatively little impact? So you can't buy Smirnoff Ice at the grocery store, big deal. Do we think this does anything to limit underage drinking? Is the benefit worth the cost of reinforcing our image to the world as a dry state?

Story from today's AP...

SALT LAKE CITY - Utah's supply of flavored malt beverages will likely be exhausted in a few weeks as manufacturers decide whether to comply with labeling rules intended to make it clear the products contain alcohol.

Utah has some of the strictest liquor laws in the country, a byproduct of its large Mormon population. The Church of Jesus Christ of Latter-day Saints counsels members not to drink alcohol, and the church is highly influential among state lawmakers on alcohol policy.

On Wednesday, Utah will be the only state to ban the sale of fruity alcoholic drinks at grocery stores and convenience stores in an effort to keep them from minors. Those drinks also must have new state-approved labels on the front of the product that contain capitalized letters in bold type telling consumers the drinks contain alcohol and at what percentage.

So far, no new labels have been approved. Utah Department of Alcholic Beverage Control spokeswoman Sharon Mackay said the state's limited supply of those drinks will likely be gone in a few weeks.

Flavored malt beverages are already sold in state liquor stores, but they have a higher alcohol content than what has been allowed in grocery stores. They also have the same labels found in the rest of the country.

Some manufacturers have already decided it's not worth it to produce new labels just for Utah.

"Thanks to the Legislature, Smirnoff Ice is no longer available in Utah," said Zsoka McDonald, spokeswoman for Diageo, one of the world's largest multinational beer, wine and spirits firms. "It's just not cost effective."

Mackay said the department won't reorder any of the flavored malt beverages it has in stock until manufacturers comply with new labeling requirements.

"Many manufacturers, frankly, have not decided whether it's worth carrying the product to make changes on the labels," Mackay said. "It's anybody's guess which ones will be carried."

Republican Gov. Jon Huntsman said banning products like Zima, Smirnoff Ice and Seagram's Fuzzy Navel from grocery stores would harm Utah's image, but agreed to it in exchange for increasing the amount of liquor allowed in shots and standard cocktails to 1.5 ounces, up from 1 ounce.

Italian Cool--Dolcetti Gelato

2008-09-25T10:51:00.000-07:00

Dolcetti Gelato has experienced meteoric success since husband and wife Mark and Elizabeth England began selling gelato at the farmers market, just three years ago! As artists, the England's apply the same dedication to gelato they would to paint and canvas. Indeed, they've studied with the best gelato artisans in Italy, the home of gelato. With a second location now open in Park City, they've obviously found a home for "Italian Cool" in SLC!

For location and hours, or to read about their gelato offerings, go to their website.

1) Why gelato? Did you consider other 'artisan' foods?

Because we are both artists we have this inherent focus on quality and making the best. Gelato is simply the best ice cream there is so it was a natural direction to take. I love cooking so there are always other things I would love to make at the store, but I have my hands full keeping gelato made every day. We chose to make crepes as well, as they are pretty simple and can be made fresh to order with lots of variations. My favorite crepe is spread with nutella, filled with stracciatella gelato (chocolate chip) and strawberries with whipped cream on top. Our espresso and Tea Grotto teas are also a good addition to gelato. We offer affogato, which is espresso or hot chocolate with a dollop of vanilla gelato. We also have imported Italian artisan foods such as olive oil, bruschetta spreads, pastas, and marinara.

(Mark and Elizabeth England in Italy, the home of Gelato.)
2) Please describe your beginnings at the Farmers Market. How long did you do that? At what point did opening your own digs become obvious? Why?

Everything pretty much started at the Farmer's Market three years ago. We had so many eager customers each Saturday who loved our gelato and kept asking where they could get it during the week that it was a natural progression to move to a permanent location.

3) Was this the plan all along, opening two locations (maybe more), or did your success just 'happen.'

At the beginning we didn't really know what would come next. As we continued to do well it made sense to open our original location in Sugarhouse. The opportunity to open a store in Park City came along and seemed like a good second location so we dove in. We are contemplating a few more locations but are happy putting our energy into developing the market in P.C. right now. Making artisan gelato requires a lot of personal care and supervision, so we have to be careful as we expand to also make sure the quality isn't compromised. You simply cannot mass produce it or franchise it.

4) Both you and Mark are artists.? Which skills did you develop as an artist that you use most in owning, and running this business?

I love creating spaces as I graduated in design, so it was fun designing the locations, especially Park City, where we could design it from the floor up. The creativity that comes with artistic training helps when it comes to creating new flavors and how to present the gelato and store. Mark is an accomplished artist, so it was great to have lots of wall space in Park City to hang some of his art.

5) Why did you choose Park City for your new location?

It is an untapped market and the locals as well as the tourists are a sophisticated group. Most have traveled a lot, are familiar with Italy and gelato and appreciate being able to find gelato in their neighborhood.

Rich Guy?

2008-09-23T11:38:00.000-07:00

One rich man's plea, too funny! Reminds me of some real estate investors I know, the ladies, of course....

Party While The Ship Is Sinking!

2008-09-23T11:20:00.000-07:00

I've gotten several emails asking about where the bottom is....Answer, I don't know, but believe we will start seeing clarity once congress approves the bailout. When that happens, reaction from the stock market should be a good indicator of what the "smart money" thinks of the road ahead...

Meanwhile, enjoy the clip, it's funny.

Bad Mortgages--Banks Failing....Why?

2008-09-16T15:42:00.001-07:00

With banks failing and mortgages tougher to get than ever, we have yet another sign there is no free lunch. But how did this happen? The people that run our banks come from the top of this meritricious society, from the Ivy League, MBA's, attorneys...

It's relatively simple, first the government opens the door by requiring lenders to make so many loans in the "sub-prime" market, to people who normally would never be approved for a mortgage. The lender, who almost never holds the loan, sells the loan to another bank. Eventually, loans are grouped, sub-prime (high risk loans made without "proper" collateral) mixed with higher quality loans, by an investment bank and sold to investors, who pay so much based on the investment ranking, what's known as derivatives. Many of these loan packages were ranked as A quality investments, even though many of the loans in any given package were actually C or D quality investments(typically around 5-10%).

It's true there were few warnings, save for Warren Buffet who has been warning about the risks of derivatives as long as five years ago. And it really isn't rocket science. For most of the last 100 years, you could buy a home only with 20% down, because that was the best way to ensure you could pay your mortgage. Relax these standards, NO money down, and this is what happens. Think about it, your bum neighbor comes to you asking for a loan, will you take his promise alone, or will you make him sign over his car as collateral? The answer is obvious, so why would we do nationally what we wouldn't do next door?

Did our best and brightest, the ivy league grads who largely run the banks know better? Of course they did. During the run up to the bubble, they were getting fabulously rich through bonuses built on selling junk loans. This crises demonstrates the dark side of human nature, we'll do things we know are wrong when "everyone else is doing it." It reminds me of a friend of mine, who during college worked at hotel as a valet parking attendant. Now he's a family man, good job, church goer, respected in his community. Back then he told me recently, he and every last one of his peers who parked cars took around half of all the parking proceeds that were to have gone to the company. Over a couple beers one night, he expressed wonder at this part of his life. He said, "I'm not a thief, I would never steal anything!"...."But that's not true, I enthusiastically stole all that money from my employer!" I think the answer is simple, ethics are often relative to our situation, relative to what our peers are doing.

And its probably unavoidable, human nature as it is, that 60 years from now the same excesses will occur from the same people who should know better. So what's the point of this post, other than wallowing in human misery:)....Maybe those of us who are living through this now will speak up in the future when our leaders suggest that the rules are just sooo old fashioned....(See Website for Mortgage Calculator)

Unique House Of The Week

2008-09-16T14:58:00.001-07:00

I've always loved unique, unusual homes, odd shaped rooms, attics converted to lofts, wharehouse living. I love barns converted to living spaces, especially the hay loft, is this wrong? So when I found this space, at the TOP of a Seattle skyscraper, I was in love. Notice both the BIG open feel, and the small cozy areas like the bedroom. Or the rafters, beautiful. (After enjoying this article, please take the poll to your right.)
When we purchased a home in Sugarhouse this June, one of the big sellers for me was a 300 sq/ft loft, where I now office and am writing this article. It reminds me of my grandmothers farm house, it has that wonderful smell common in older homes everywhere. I get about half way up the stairs and it hits me, my brain is flooded with thousands of wonderful memories of childhood. We'd explore the closets which traveled into the houses eaves, filled with old treasures, and contemplate things we were not allowed to do. The owner of this space holds a 40 year lease, and hired Castanes Architects to help her design it for her needs. It was once the caretakers living area, after it housed a water tank! Castanes Architects assisted her in deciding how to live in the space and where to site the basic necessities, and she took it from there. She shares the space with a huge Dale Chihuly sculpture, a gift from the artist, which fills a good portion of the large pyramidal volume that is now the living, dining, and kitchen area of this most unique home. A large and growing collection of artwork and collectibles makes this home a personable definition of its sociable and on-the-go inhabitant. And yes, she rode out the February 2001 earthquake in the space with virtually no damage!

When I tour homes for and with clients, it's often the smells which hit me first. The smell of an old home, a garage, a utility shed, all come with powerful reminders from childhood. I'm curious about your house memories, what sets you off, what reminds you of good times as a child?

UT Economy, The Tops

2008-09-12T10:08:00.000-07:00

If you're trying to sell your home today, it may surprise you to learn two cities in Utah are among the nations top three fastest growing job markets. For some time I've been writing about the tug of war going on in Utah between our ABOVE average job market versus the slowdown in real estate. I DID believe our economy would keep real estate steaming ahead. While that has not happened, our market is still healthy relative to the rest of the nation.

These new findings are great news for the real estate market, especially when we look at the kinds of jobs Utah is creating. The new findings by the Miliken Institute show Utah at the CUTTING EDGE of the NEW ECONOMY, providing high income tech jobs. Yesterday, I met two new friends at a luncheon, Tommee from Canada, Ya Ching from Taiwan, both process engineers. None of us had met before or knew each other, so it struck me as interesting. We are attracting the BEST educated from around the world, people who can truly write their own ticket. With a Ph.D. in engineering, Ya Ching could have gone anywhere, but chose Utah for the lifestyle, in addition to a great job offer.

The following spells out why Utah should continue at the top of our nations economy, from Fridays Salt Lake Tribune.

Utah's urban corridor is at the forefront of the "new economy."

So much so that three Wasatch Front metro areas are in the Top 25 in the United States in the annual Best-Performing Cities index compiled by the Milken Institute and Greenstreet Real Estate Partners. Provo-Orem is in the No. 1 spot, with Salt Lake City at No. 3 and Ogden-Clearfield 18th.

The rankings speak to Utah's combination of institutions of higher education that spin off research into commercial products, the concentration of high-tech and medical science companies and a competitive pool of capital.

Report author Russ DeVol, an economist and director of Regional Economics at the Milken Institute, also cited the low cost of doing business in Utah, a pro-business attitude and the state's comparatively small exposure to the subprime mortgage crisis.

"So Utah overall has been the best performer in the past few years," said DeVol.

Jason Perry, executive director of the Governor's Office of Economic Development, said the Milken index is just one of several recent reports that rank Utah as a top state for doing business and for its high-tech industry. Milken is important because it looks at long-term economic indicators that the state also uses to decide how to spend money on economic development efforts, he said.
"Certainly we take from this that we are doing this right. It helps guide us as we help to recruit companies in the future and grow business here."

This was the ninth year the institute has ranked urban-area economies. The Best-Performing Cities study is based on job creation and retention, the quality of jobs being produced and overall economic performance.

The Utah urban areas received high ratings because the jobs created here generally are higher-paying and linked to the state's booming technology and life-sciences sector.

Those types of jobs are dependent upon what DeVol calls the intangible economy, which is knowledge-based, often developed at universities and characterized by the importance of human capital and intellectual labor.

That contrasts to the "old economy," based on manufacturing in which jobs were relatively low-skilled and in such places as Michigan and Ohio.
"Other areas have seen a large loss of jobs to China," DeVol said. "Utah is not as tied in as closely to what some called the old economy."

Emphasizing the shift away from the manufacturing economy of the so-called Rust Belt, the South had 16 metro areas among the top 25 of the index, while the West had eight.

Among other reasons, Provo-Orem jumped from the eighth place in the index last year to No. 1 based on increased research at Brigham Young University and the subsequent spin-off of jobs into the private sector.

Although BYU is mainly a teaching institution with a relatively small research budget, it has faculty who are entrepreneurial-minded and its highly rated Marriott School of Management offers a number of classes on entrepreneurship, said Mike Alder, director of the Office of Technology Transfer.
''We have had a lot of research in new drugs, in diagnosis and in medical devices,'' he said.

Shauna Theobald, chair of the Utah Valley Entrepreneurial Forum, which promotes business start-ups, said an "ecosystem" has developed in Utah County that feeds entrepreneurial activity. That includes a history of high-tech companies stretching back to WordPerfect and Novell and a group of Angel investors, individuals who pour money into start-ups.
"We've got the money. We've got the inventors. We've got the experience," said Theobald, a manager at Novell's Open Source Technology Center.

DeVol said Salt Lake City benefits from the presence of the University of Utah, particularly its medical research. The metro area also has a high concentration of computer hardware and software companies, and strong financial and medical companies that are regional leaders.

Hill Air Force Base helps drive the economy of the Ogden-Clearfield area, which moved up 42 places from last year in the Best-Performing Cities index.
"Hill has been an important anchor in drawing a number of aerospace-related firms to the area," said DeVol.

In southern Utah, St. George ranked in fourth place among small cities after being No. 2 last year. Much of that area's economy is based on construction, which has been hit by the downturn in the nation's housing market.

Top 3 Suggestions, Photographing Your Listing

2008-09-12T09:58:00.000-07:00

The rules of "staging a house" are flexible, but here are a few hints on how to best present your listing attractively.

1. Make sure house is clean.

2. Make sure your home is "de-cluttered."

3. PUT AWAY THE TRASH CANS!!!!!!

New Tax Credit For Homebuyers

2008-09-08T13:09:00.000-07:00

I'm delighted to introduce SugarHouseHomes' newest feature contributor, Jennifer Berard, Owner and Principal Lending Manager of Mortgage America, Utah. With lending policies stricter than ever, Jennifer's years of experience and professionalism are a must for homebuyers. I'm convinced you'll be as impressed with Jennifer as I was when I first used her services, you can find her at Mortgage America Utah. Enjoy her first article!

TAX CREDIT FOR FIRST TIME HOMEBUYERS

I have received many questions regarding the NEW FIRST TIME HOMEBUYER TAX CREDIT. Earlier this year, the United States Congress passed the Housing and Economic Recovery Act of 2008. This bill includes a temporary tax credit for first time homebuyers of up to $7,500 for those who purchase between April 9, 2008, and July 1, 2009. This credit is available to anyone buying their first home or anyone who has not owned a home in the prior three years. Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full credit. A home is eligible for the credit if it is any residence that will be used as a primary residence (single-family, town house, condo, etc.)

This is a great incentive for first time homebuyers! Now is a great time to look at purchasing a home. For more detailed information about the bill and the tax credit visit federalhousingtaxcredit

Jennifer Berard
Owner/Principal Lending Manager
Mortgage America, LC
TEL: 801-364-5100
JenniferBerard@msn.com
www.MortgageAmericaUtah.com

Landlord Demands Payment In Gold, And Wins!

2008-09-05T12:52:00.000-07:00

CINCINNATI: A federal appeals court has ruled that a building owner can enforce a clause in a 1912 lease requiring rent to be paid in gold coin for a landmark Cleveland skyscraper.

The 6th U.S. Circuit Court of Appeals in Cincinnati sent the case back to U.S. District Court in Cleveland to determine the equivalent rent that S&R Playhouse Realty Co. owes for the Halle building with the ''gold clause'' enforced. The court also must address any remaining S&R defenses.

The building is owned by 216 Jamaica Avenue LLC, which filed a breach-of-contract lawsuit in 2006 against S&R demanding rent equivalent to the value of 35,000 1912 gold coins. S&R has paid $35,000 annually in American currency since assuming the lease in 1982. It balked at paying the gold-value, which would be a much higher amount. The lower court sided with S&R.

CINCINNATI: A federal appeals court has ruled that a building owner can enforce a clause in a 1912 lease requiring rent to be paid in gold coin for a landmark Cleveland skyscraper.

The 6th U.S. Circuit Court of Appeals in Cincinnati sent the case back to U.S. District Court in Cleveland to determine the equivalent rent that S&R Playhouse Realty Co. owes for the Halle building with the ''gold clause'' enforced. The court also must address any remaining S&R defenses.

The building is owned by 216 Jamaica Avenue LLC, which filed a breach-of-contract lawsuit in 2006 against S&R demanding rent equivalent to the value of 35,000 1912 gold coins. S&R has paid $35,000 annually in American currency since assuming the lease in 1982. It balked at paying the gold-value, which would be a much higher amount. The lower court sided with S&R.

By Associated Press

Foreclosures, Delinquencies Reach Highs--Salt Lake City Focus

2008-09-05T09:39:00.000-07:00

It's got to get worse before it will get better...It's cliche, but in our housing market all too true. For some time I've thought and been writing about two possible outcomes in the Salt Lake City market. Either we grow our way out of our slow down, or prices drop dramatically from recent levels.

Growth does not appear to be our savior, as I highlighted in a previous post Utah job growth has not held up as predicted. And, as job losses are heavily caused by the depressed real estate market and plummeting contruction, it's a double whammy. It looks like we'll take the more painful route in clearing out HISTORICALLY HIGH house inventories and getting our market healthy again with SIGNIFICANT drops in home prices valley wide. An INCREASE in foreclosures is a sad but likely necessary reality to help bloated inventories.

The following article is from September 5th, Bloomberg Online.

Sept. 5 (Bloomberg) -- Foreclosures accelerated to the fastest pace in almost three decades during the second quarter as interest rates increased and home values fell, prompting more Americans to walk away from homes they couldn't refinance or sell.

New foreclosures increased to 1.19 percent, rising above 1 percent for the first time in the survey's 29 years, the Mortgage Bankers Association said in a report today. The total inventory of homes in foreclosure reached 2.75 percent, almost tripling since the five-year housing boom ended in 2005. The share of loans with one or more payments overdue rose to a seasonally adjusted 6.41 percent of all mortgages, an all-time high, from 6.35 percent in the first quarter.

Tumbling home prices are making it difficult for even the most creditworthy owners with adjustable-rate mortgages to sell or get a new loan as their financing costs rise, said Jay Brinkmann, MBA's chief economist. Prime ARMs accounted for 23 percent of new foreclosures and subprime ARMs were 36 percent, he said.

``People chose the lowest payment option to get into some of the very expensive housing markets and now that prices are coming way down, they can't sell and they can't afford the higher payments,'' Brinkmann said in an interview.

The three-year-old housing slump has slowed growth of the world's largest economy, caused more than half a trillion dollars of losses at banks such as Citigroup Inc. and UBS AG, and crimped earnings for companies such as Home Depot Inc. and Lowe's Cos. that rely on home purchases to fuel demand.

Economic Growth

The drop in home sales and values, along with tighter credit conditions and higher energy costs, probably will ``weigh on economic growth over the next few quarters,'' Federal Reserve policy makers said Aug. 5 when they decided to hold their benchmark rate at 2 percent. The central bankers cut the rate seven times in the last year in an attempt to avert a U.S. recession.

The Fed probably will keep the rate level for the next few months, according to the price of Fed funds futures. There's an 81 percent chance of no change at the Sept. 16 meeting and a 75 percent chance of no action at the Oct. 29 meeting, they indicate.

Foreclosures started on prime mortgages rose to 0.67 percent from 0.54 percent and the foreclosure inventory increased to 1.42 percent from 1.22 percent, the report said. The share of seriously delinquent prime mortgages was 2.35 percent, up from 1.99 percent.

Prime Mortgages

The share of new foreclosures on prime ARMs was 1.82 percent, triple the 0.58 percent in the year-earlier quarter, and the total foreclosure inventory was 4.33 percent, up from 1.29 percent, the report said. The share of seriously delinquent prime ARMs was 6.78 percent, rising from 2.02 percent a year ago.

New foreclosures on subprime loans rose to 4.7 percent from 4.06 percent in the first quarter, according to the report. The total foreclosure inventory increased to 11.81 percent from 10.74 percent and the so-called seriously delinquent share of loans that are 90 days or more overdue rose to 17.85 from 16.42 percent.

Existing home sales fell to a 10-year low in the second quarter and the median price for a single-family house dropped 7.6 percent, according to the National Association of Realtors in Chicago.

About 75 percent of U.S. banks surveyed indicated they tightened standards on prime mortgages, up from 60 percent in the previous survey, the Federal Reserve said on Aug. 11.

The Mortgage Bankers report is based on a survey of 45.4 million loans by mortgage companies, commercial banks, thrifts, credit unions and other financial institutions.

Buyer Without An Agent Animation

2008-09-03T16:02:00.000-07:00

Ok, as a realtor, of COURSE I'm a little biased, but this little animation is pretty close to the truth. Jim Reppond, a Seattle area realtor, created this Buyer Without an Agent animation that re-enacts a possible conversation between a buyer and a listing agent.

Landlord-Tenant, What Do Landlords Want

2008-09-02T14:31:00.000-07:00

Here's a questions I get frequently....

Q: I just bought my first rental property. Do you have any advice for me on renting it? Any recommendations on books I should read?

A: The most important thing you can do to make your investment successful is to find high-quality tenants. You can do this in a lot of ways, but offering a great property at a great price will yield tremendous results.

Pick a competitive rate — or even one slightly below the going market price. You will get dozens of potential renters knocking at her door from a single ad. A friend of mine even had an interested renter offer to repaint the unit for her if she would let him sign the lease.

In addition to offering your unit at a competitive price, be sure and do credit and rental history checks. Remember, the most important indicator of future results is past performance.

As for books, I like anything by Robert Irwin. I also enjoy Robert Shemin’s books such as Secrets of a Millionaire Landlord (Kaplan, $18.95). For tax information, try Every Landlord’s Legal Guide (Nolo, $44.99).

Business Card Confirms-Real Estate Salesman Is Eddie Money

2008-09-01T10:13:00.000-07:00

from TheOnion.com

STOCKTON, CA—The suspicions of house hunters Paul and Gail Barnett were confirmed Tuesday when a business card revealed that the Century 21 agent showing them a two-bedroom split-level ranch was indeed rocker Eddie Money. "He looked just like the guy who sang 'Two Tickets To Paradise,' but I figured it must just be somebody who resembles him," Gail said. "But then, right there on the card, it said 'Edward Money.'" Gail praised Money for his thoroughness and professionalism.

Run For Your Life!

2008-08-28T10:25:00.000-07:00

Tempted to bid on short sales? Clients ask me about these properties frequently, which, in my experience, are a huge waste of time, and MONEY. Fact is, most of the time, people do not have success buying these homes. They usually go to foreclosure, but only AFTER unknowing consumers have submitted bids, escrowed money, and waited for months, many months.... Here's a home for short sale in Sugarhouse at 1209 Logan, I'll bet anything it goes to foreclosure...Here it is...(And look at these junky photos, yea, they're motivated sellers...)

Ahhh, the pictures make this house feel like a home! (Maybe the money they save on photography goes to the buyer, haha!)

Desperate Times....Real Estate Agents

2008-08-27T10:46:00.000-07:00

Hmmm, a sales strategy I might need to consider....

Ridiculous Homes For Sale SLC

2008-08-26T12:19:00.000-07:00

Today I was flipping through new listings on Craigslist and found SO MANY ridiculously priced homes, I had to start posting some of them here. This weeks home is nice enough, but its priced in Harvard/Yale territory at 179 sq/ft! It gets me thinking, who is falling for these OVERPRICED homes?

The home at 3332 S Santa Rosa Dr., (3275 E),has 2157 sq/ft and has been intermittently listed for sale from June 2006 to August 2008. It was first listed at $360,000 in 2006, until it expired in the fall 2007. It was relisted in February 2008, in a slowing market, for $387,000! It's listed for sale today on Craigslist for $387,000.

A couple negatives right off, the home has a carport, NO GARAGE, and a swamp cooler, no central AC. It fits the profile of many of the hundreds of homes I've been through in the last year. It's updated with modern touches to look good, but there's still heavy lifting to make this a truly remodeled home for todays buyer. I've not been through this home, but I'd bet dollars to donuts it has old school, single pane windows that would also need to be updated. The point, at $387,000, this home still need all kinds of work.

Compare this listing to a recently sold home, at 1975 S 1600 E, a 2148 sq/ft home, that's obviously well cared for, for $380,000. Not only is this home more modern with AC and a garage, its in a WAY better area, and you know what they say about location. Here's home 2.

Even home 2 is overpriced, it's at the HIGH end of rationality, home 1 is well....

Incompetent Realtors, What Do You Think?

2008-08-25T16:34:00.001-07:00

Who do you think is at fault? Word out today that the homebuyers featured in this story (the Ummels) lost their law suit against their realtor. The Ummels claimed their agents neglect led to them paying $100,000 more than they should have. First read the New York Times Article from January 2008, then the description of what happened with the lawsuit, and the jury's reaction from today.

From The NYT 2008

"Ms. Ummel claims that her agent hid the information that similar homes in the neighborhood were selling for less because he feared she would back out and he would lose his $30,000 commission.

Real estate lawyers and brokers say the case, which goes to trial in the north county division of San Diego Superior Court on Monday, is likely to be the first of many in which regretful or resentful buyers seek redress from the agents who found them a home and arranged its purchase.

“When your house appreciates $100,000 in the first six months, you’re not quite as concerned that maybe the valuation was $25,000 or $50,000 off,” said Clifford Horner of the law firm Horner & Singer. “But when your house goes down, you ask: ‘Who might have led me astray here?’ ”

Agents representing buyers rarely had the opportunity to make mistakes during the last real estate boom, in the late 1980s, because the job hardly existed then. For decades, residential transactions almost always involved brokers who, whatever assistance they gave the buyer, legally represented only the seller.

The long boom that began in the late 1990s put an end to that one-sided world. As prices spiked, buyer’s agents and brokers became popular as sounding boards, advisers and negotiators. The National Association of Realtors estimates they are now involved in two-thirds of all residential purchases.

That makes this the first housing collapse in which large numbers of buyers had a real estate professional explicitly looking after their interests. The Ummel case poses the question: In a relationship built on trust, where promises are rarely written down and where — as in this case — there is no signed contract, what are the exact obligations of these representatives in guiding their clients through a sizzling market?

“Agents have a lot of fiduciary duties, but they don’t make money unless they close the sale,” said Joel Ruben, a real estate lawyer in Manhattan Beach, Calif. “In an inflated market, there are built-in temptations to cut corners.”

The defendant in the Ummel case is Mike Little, a veteran agent with ReMax Associates. He will argue that Marty Ummel, who brought the case with her husband, Vernon, is trying to shift the blame for the couple’s own failures of research and due diligence.

“They simply didn’t do what is expected of a knowledgeable, sophisticated buyer, and are now looking for someone other than themselves to take responsibility,” Roger Holtsclaw, an agent who was hired by Mr. Little as an expert witness, said in a court deposition.

Ms. Ummel is 60; Mr. Ummel, 71. With retirement on the horizon, they decided in late 2004 to move from the San Francisco Bay area to San Diego, where they would be near their grown children.

Since they were not making the move for job reasons, they decided to take their time and focus on finding a house that was a good value. In a boom, that is no simple task for buyer or agent.

It is clear the Ummels did not rush into a decision: They dismissed one agent and canceled deals on two houses before Mr. Little found them a prospect on a cul-de-sac in a five-year-old luxury development. A deal was struck with the owner, herself a real estate agent, for $1.2 million.

Mr. Little also worked as a mortgage broker. The Ummels say he encouraged them to get their loan through him. Mr. Little ordered an appraisal of the house but did not respond to the couple’s requests to see it, the suit charges.

A few days after the couple moved in, in August 2005, they got a flier on their door from another realty agent. It showed a house up the street had just sold for $105,000 less than theirs, even though it was the same size.

Then they finally got their appraisal, which told them the house up the street was not only cheaper but had a pool. Another flier in early October mentioned a house down the street that was the same size and closed the same day as the Ummels’ but went for $175,000 less.

The Ummels accuse Mr. Little not only of withholding information but of exaggerating the virtues of their house to push them into a deal.

Ms. Ummel said in her deposition that Mr. Little had told them “many times that it was a very good buy.”

“And you believed that?” asked David Bright, the lawyer who represents both Mr. Little and ReMax Associates, which was also named in the suit.

“Yes, we trusted Mike Little,” Ms. Ummel replied.

Mr. Horner, the lawyer, said valuation is a tricky area for brokers.

“Brokers aren’t appraisers,” said Mr. Horner, one of the writers of a guide to suing brokers. “They have no obligation to opine about value. But once they do, it becomes a gray area whether it’s puffery or a misstatement of a known fact.”

"Most people who made a bad real estate deal might wince and move on, but people who know Ms. Ummel describe her as unusually determined. She spent a year picketing ReMax offices on weekends.

Mr. Ummel, an administrator at Dominican University, gave her his permission to pursue the case, on one condition: “Don’t tell me how much the legal fees are.” So far, the bills come to $75,000, more than Ms. Ummel’s annual salary as a fund-raiser at California State University in San Marcos.

“I do not think I’m obsessive-compulsive, but I am 114 pounds of absolute perseverance,” Ms. Ummel said.

That persistence has put the Ummels at the forefront of a developing legal question. When buyers have sued their agents in the past, the cases focused on problems with the property itself, often alleging failure by the broker to disclose a known hazard or maintenance issue. After reviewing litigation records for the last five years, the National Association of Realtors could find no cases that revolved solely around the question of valuation.

Ms. Ummel’s original suit included the appraiser, who was accused of skewing his report to make the Ummel’s house seem worth the purchase price, and the mortgage broker. Modest settlements have been reached with both.

In a brief phone interview, Mr. Little called the case “ridiculous,” adding: “The lady’s a nut job. I didn’t do anything wrong.”

Mr. Little said that contrary to Ms. Ummel’s claims, the suit was motivated mainly by the declining market. “When people see their home values and assets declining, they always feel there’s someone to blame,” he said. “This is a dangerous time for all of us in the industry.”

The agent declined several requests to expand on his remarks. His lawyer declined to be interviewed. So did Geoff Mountain, a co-owner of ReMax Associates, which owns the office that the Ummels were dealing with.

Both sides have hired appraisers who have combed the surrounding development. Mr. Little’s appraiser concluded the four-bedroom, 3.5-bath house was worth $1,150,000 to $1.2 million in the summer of 2005. The Ummels’ appraiser said it was worth $1,050,000.

The outlines of Mr. Little’s defense can be seen in his lawyer’s lengthy deposition of the Ummels. Even in a relatively new development, Mr. Bright said, no two houses and no two deals can be seen as identical. For instance, a pool does not necessarily add value because “some buyers like it, some don’t.”

Mr. Little never showed the Ummels the house down the street because the backyard could be viewed from other houses, the lawyer said, and the couple had said they valued their privacy. Ms. Ummel disputes saying this.

The agent who left the flier that led to the case, Margaret Hokkanen, is sympathetic to Mr. Little.

“People are responsible for their own decisions,” said Ms. Hokkanen, who has been subpoenaed as a defense witness.

Her husband and partner, John Hokkanen, is more ambivalent.

“We have seen so much misrepresentation over the last five years,” he said. “So I appreciate where these buyers might be coming from: ‘I’m a lowly consumer, you’re certified by the state of California, you didn’t do X, you didn’t do Y, and I got hurt.’ ”

The Ummels may be on the leading edge of the law, but they are unlikely to be alone for long. With the market falling, many homeowners owe more on their mortgages than their houses are worth. And many of those deals involved brokers who are required to carry professional liability insurance, presenting a tempting target for angry buyers.

“If you put someone into a property at the top of the market, you look really bad if it goes down,” said K. P. Dean Harper, a real estate lawyer in Walnut Creek, Calif. “There are a lot of letters going out from lawyers to real estate agents saying, ‘My client would never have purchased if you had properly evaluated the market conditions and the value of the property.’ ”

And here is the story describing the results of the lawsuit.

"Remember Mike Little? Of course not. How about Marty Ummel? She's the woman who claimed that Little, her San Diego real estate agent, let her pay $150,000 more than the house was worth by failing to provide her and her husband with adequate information on comparable houses.

Marty Ummel was a cause célèbre for a couple of weeks last winter, after her story – which included her spending nine months worth of weekends picketing Little's real estate office - hit the news. Her appearances on national television were typically teased as One Woman Takes On Crooked Real Estate.

What didn't make the news, or at least, what I didn't find out until today until I saw it on the Voice Of San Diego website, was that

With an enthusiastic and unanimous response, the jury found that Little had executed a reasonable standard of care when he showed his clients, Vern and Marty Ummel, more than 80 homes in a house hunt that began in May 2005, ultimately leaving them to their decision to pay $1.2 million for their house two months later.

Which lead me to see what the Union-Tribune had to say;

A Carlsbad couple who sued their real estate agent, claiming he duped them into overpaying for a $1.2 million home, said they have no regrets about taking the case to court, despite a unanimous jury verdict yesterday that the Realtor had done nothing wrong.
(...)
The 10-woman, two-man jury apparently had little trouble reaching a decision, delivering a unanimous verdict within two hours yesterday afternoon.

So, there you have it. Ms Ummel's side of the story was heard nationwide. Mr Little declined to comment when the story first broke; after the verdict, he told one reporter,

It has been more than two years of quite problematic times for me, and I'm happy to get it behind me. I've just had a very difficult time working, approaching clients. You just get leery.

Apparently, each side will be responsible for their own legal costs."

Realtors, Get Some Empathy!

2008-08-21T11:22:00.000-07:00

A recent real estate listing appointment re-reminded me how important it is to empathize with my clients. The three siblings were selling their mothers SLC home, their childhood home, after their mom passed away in her early nineties. You know the kind of place, neat as a pin, classic pink bathroom tile, shag carpet, and knotty pine paneling.

It's always a challenge to sell possessions filled with a lifetime of memories. Every corner, closet and alcove hold reminders and are unique. It's difficult to balance long term emotional attachments with the realities of a vastly slowing market. As a professional, it's my job to educate my clients into making wise buying and selling decisions. In today's market, these decisions are not easy.

When I'm speaking with a client who I think is not being wise, I try and put myself in their shoes. Imagine the homeowner who has witnessed neighbors sell at the top of the market in 2006-2007, walking away with a pocket full of cash. These homeowners are now faced with selling for 10%-20% less than anticipated. How frustrating this must be, and many home sellers (incorrectly) blame themselves...

I experienced many of these emotions making my own investing decisions. When I first started investing in stocks, I was terrified to leave ANY profit on the table, and as a result sold at the first hint of a profit. As an example, in 2002 I purchased shares of MFW, a small company that makes licorice extract. It sounds exotic, maybe a little weird, but I was jumping for joy when shares I purchased at $4.06 rose to over $6.00 a share. I sold....Over the next year, shares of MFW rose to over $13.00 a share! Even though I'd made a tidy profit, I felt miserable. How could I be so stupid!

None of us has a crystal ball, so its silly to BLAME ourselves for what in hindsight appears to be a bad decision. Even so, there's a difference between intellectual and emotional understanding. As a realtor, I remind myself of this reality and remember my investing mishaps, understanding and helping my clients make wise, if painful decisions. (realtor.com, real estate listings)

Yale Student To Bring Her Own Little House To Campus

2008-08-20T15:39:00.000-07:00

Estimating her expenses to live for two years in New Haven while a graduate student at Yale University, Elizabeth Turnbull arrived at about $14,000, even if she shared an apartment.
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"Well, if I have roughly $14,000 I am going to spend on living space anyway, is there something more creative I can do with it?" she asked.

There was. An incoming student at Yale's School of Forestry and Environmental Studies, where students fret as much about their carbon footprint as they do about grades, Turnbull decided to build her own green housing design.

It would be tiny, transportable and ever so environmentally friendly; green as grass. She would arrive at Yale with her own house.

For months she has been building it on the grounds of the Governor's Academy in Byfield, Mass., a preparatory school she attended. She works nearby in Beverly as a sustainability coordinator with a building company.

Her new home-to-be is 8 feet by 18 feet and was built atop a flatbed trailer. It has a tiny sleeping loft, a storage loft, a study nook, a kitchen area, a living area and a bathroom. Sometime in the coming weeks, she will tow it to New Haven for the start of the academic year.

The house is so compact, she expects to light it and power her cellphone and laptop computer with the energy generated from three solar panels that total about 18 square feet of surface. That's renewable energy, totally free, off the grid.

"I am really a glutton for light. I mean, I do not want to be living in a cave," she said. "I probably could have gotten away with even a smaller solar array, but it can be kind of cloudy in New Haven sometimes, and I thought that was something that I did not want to compromise on. So it will be a very well-lit space."

She'll cook her meals and heat the Tiny House — that is what she calls it — with propane. She estimates her yearly propane cost will be $200 maximum.

The house has a recyclable aluminum roof, uses recycled sailboat sails for ceilings, features insulation made partly from a waste soy product, and environmentally friendly paints. Many of the fixtures and building materials were donated by people who had lumber or hardware left over from a household renovation or expansion.

"The Tiny House has taken me by the hand and led me through the process of building it," she said. "You know when you are doing something and the process takes over? Your arms are moving because the project has almost gotten inside your body and told you what to do."

Assuming it meshes with local regulations, she'll have a composting toilet that recycles human waste. The bathroom — toilet and shower stall combined — measures 3 feet by 3 1/2 feet.

"Yep, it is pretty tiny," she said.

So far, she has spent about $8,000 on the house and expects it to cost about $11,000 when finished and furnished.

An inspiration for her house was the Tumbleweed Tiny House Co. in Sebastopol, Calif., which sells small, transportable homes. But they were more expensive than she could afford.

"I thought, 'I'm working with a building company, and I have some skills. Why not try it?'" She set to work designing her space, contacting zoning officials in New Haven, talking to companies that might sponsor her project.

Her former school agreed to let her build the house on the school grounds and gave her use of tools, which was invaluable. Friends and volunteers have been helping her build the house (a friend did the wiring), kind of like an old-fashioned barn-raising. Companies donated some materials, and people chip in with their time or furnishings.

A woman in Newburyport gave her boxes of ceramic tiles — different styles, colors and sizes — that Turnbull will use for a countertop and backsplash in the area that will become her kitchen.

Turnbull, who lives in Newburyport, Mass., is originally from Charleston, W.Va. She majored in environmental policy and economics at Colby College in Maine, worked on the West Virginia staff of presidential candidate John Kerry, led bicycle trips across the U.S. and Europe, worked for a natural-resources consulting firm, then the federal Department of Energy, and most recently led trips for an adventure travel company, visiting 29 countries in 14 months.

She is 26, and her job this summer, besides building the Tiny House, is to help O'Neil Fine Builders incorporate green materials and practices into its projects.

Exactly where she will place the Tiny House in New Haven is not determined, but Turnbull is talking with the city and the university about suitable sites. Turnbull said she is optimistic she'll find a spot that is safe and convenient.

Gordon T. Geballe, associate dean for student and alumni affairs at the School of Forestry and Environmental Studies, said Turnbull's house would be a symbolic statement but also would provide useful information on sustainable living in a small space, which he expects to become more common.

"I'm not sure everyone will live in a tiny house, but a lot of people will live in a small house. So the kinds of things she will learn will be useful to engineers and architects and homeowners. There is no reason why so called second-homes on a lake can't be something more like this than a mansion."

The School of Forestry and Environmental Studies, where Turnbull will study, is itself preparing to move to a new building, a 50,000-square-foot, state-of-the-art green headquarters.

"We're ecstatic that one of our students is pushing the envelope here," Geballe said.

Meanwhile, Turnbull is putting the finishing touches on the Tiny House, deciding whether there is room for a tiny futon, and learning to build cabinets. What has surprised her as the project progressed is that the space feels larger than she expected.

"You don't need a lot to live really well," Turnbull said. "I hope."

Who Do You Think The Jackass Is?

2008-08-20T10:19:00.000-07:00

The neighbors hated the new trophy house next door so they put up this sign....Talk about scorched earth tactics!

I grew up in the town Garrison Keillor used as his influence for Lake Wobegon, "where the women are strong, the men are good looking, and the children are above average." We'd never have dared to make such a public statement. No, we'd simply conduct a passive aggressive campaign to ruin their reputation! Not sure which is worse, or if I should make a gratuitous comment about Californians who just don't know any better...Nah, I'll keep my trap shut!

Thanks, 360digest.com....

CLICK for 360digest, an amazing blog!

Google Earth Street View Catches House On Fire!

2008-08-20T10:04:00.000-07:00

Yesterday they called me to say I'd forgotten to turn off my sprinklers!

Thanks 360digest.com (google earth maps)

Utah Job Growth Slows

2008-08-14T08:09:00.000-07:00

For a while it looked like Utah would remain the "belle of the ball" relative to the rest of the nation. While states like CA, NV and AZ were going through steep declines in real estate and economic growth, Utah kept chugging along. Unfortunately, the July numbers are out from the US Bureau of Labor showing Utah's job growth continues to fall, down to just .6%.

This number is best understood looking at the recent trend, from January 2008 to July 2008, job growth has been, 2.5%, 2.3%, 2.3%, 2.0%, 1.5%, .9% and now .6%. Economists had predicted growth to hang out in the 2-3% range, so this trend has caught even the experts unawares. I had hoped with robust job growth our glut of housing inventory would soon be bought up, now it appears this won't happen any time soon.

Enjoy today's article from the Salt Lake Tribune

Utah sagging job growth: Nation's pride no more

By Lesley Mitchell
The Salt Lake Tribune

A downturn in home sales in Utah has led to job losses in a host of related businesses, such as builders, title and mortgage companies and real estate brokerages.

The woes of that one industry sector have pushed down the state's job-growth rate to an anemic 0.6 percent in the year that ended in July, translating into an overall gain of only 7,300 jobs in the state over the one-year period, according to a report released Tuesday by the Utah Department of Workforce Services.

That rate, the lowest in about five years, is well down from a growth peak of 5.4 percent and a lofty gain of 54,000 jobs in the year that ended June 2006.

Utah's job-creation rate, among the best in the country at one point, is closing in on the U.S. average of negative 0.1 percent.

But relatively few people outside the home-sale industry are feeling the pain at this point. In Sandy, for example, home remodeler Doug Swensen said he initially wasn't sure how the downturn would affect his business. But so far so good, he said Tuesday while working in Holladay on yet another kitchen and basement renovation.

"If people can't sell, they are staying and remodeling. We're still really busy."
Workforce Services chief economist Mark Knold said Swensen's busy schedule illustrates just how home-sale-centric Utah's economic slowdown really is.

"Construction is really the only major problem right now."

Construction-industry employment in Utah is down nearly 12 percent, or 12,800 positions, a significant drop considering that commercial construction is still going strong. Two industry sectors - information and financial activities - are off only slightly. All others posting healthy gains.

Job losses in the construction industry have pushed Utah's unemployment rate higher. Utah's jobless rate in June was up slightly, to 3.5 percent, which translated into 48,900 Utahns who were looking for work. That's up from an unemployment rate of 2.7 percent in July 2007, when 37,000 people were considered out of work. The national unemployment rate is still much higher, at 5.7 percent.

The downturn in residential real estate markets in Utah and elsewhere stems in great part from tighter lending standards put in place in the wake of the nation's subprime lending crisis. The restrictions have made it harder for potential buyers to qualify for a home loan.

On another front, after years of home-price run-ups, homeownership is out of reach of many families. Fewer buyers means fewer sales of existing and new homes.

Utah's home-sale downturn began in earnest last summer, about two years after most surrounding states. As a result, those states are deeper into housing-related problems, with hard-pressed sellers in Arizona, California and Nevada forced to slash asking prices to get their properties sold.

But most economists say that's exactly what's needed to clear bloated inventories and set the stage for a real estate recovery.

Concessions of that magnitude haven't happened in Utah - yet.

"Utah is in its first year of denial," Knold said, adding that many homeowners are still reluctant to drop their selling prices. Some have let properties languish on the market, while others have taken homes off the market or are trying to offer leases until the market rebounds.

But by next spring, Knold believes a number of sellers who have held out will have no choice but to lower prices. Already, some builders are cutting prices to generate sales.

"Housing prices have to come down," Knold insists, adding that when they come down enough, it could spur buying that would put Utah's construction industry - and overall job growth - back on the right track.

Common Negotiating Blunders

2008-08-13T07:56:00.000-07:00

Here is a list of seven commonly made real estate negotiating blunders (real estate negotiating tips) that can help you stay out of trouble. If you're buying property without an agent and your learning these factors for the first time, you may want to consult a professional who can check your work. My comments in italics. From USNEWS and World Report ONLINE

1. Not understanding the seller. In a home price negotiating, it's essential to look at the deal from the opposite side of the table. "You want to make best use of the seller's fears," says Ed Brodow, a negotiation expert and the author of "Negotiation Boot Camp." "So the question is: What are the pressures on the seller of this house?" Sellers today could be facing any number of anxieties. Perhaps the local housing market is even weaker than the sluggish national one. Maybe the seller has landed a job in another city and has already bought a home there. He or she could even be facing bankruptcy. Any information you can obtain about the local real-estate market or the seller will strengthen your negotiating position. WhenSteven Cohen, president of the Negotiation Skills Co., first visited a home that was for sale in 1981, he noticed that the property had no furniture or heat. "That gave us a little bit of a sense of the degree to which the people wanted out and gave us a heck of a lot more bargaining power," Cohen says. "We offered tons less than what they were asking."

Very good advice. I'd specifically recommend researching what the seller owes at the county recorder. Many of my clients are shocked when, during listing appointments, I mention the amount they owe on their home. ANYONE can find this information, and if you don't, you could wind up throwing money away!

2. Forgetting your homework. Some of this needed information is readily available. You can get the sale prices of comparable homes and discover how long certain listings have been on the market from a real-estate professional, the Multiple Listing Service or an online resource, says Joshua Dorkin, the founder and chief executive officer of real-estate networking and information site BiggerPockets.com. To take the temperature of a local market, identify a couple of good real-estate blogs and click through them daily. To find out the seller's motivations, try getting in touch with him or her directly. Some will refer you to an agent, but others will chat candidly. In addition, "researching who lives in and around the home you're [considering] buying is of the utmost importance," Dorkin says. By speaking with neighbors, you'll gain a sense of what life is like in the community and perhaps even pick up some insight into why the sellers are moving. "You can never have enough information," says Jim Camp, the author of "No: The Only Negotiating System You Need for Work and Home."

VERY GOOD information, about reading blogs I mean! But seriously, factors like how long a home has been on the market are not "nice to knows", they are the starting point of any deal. If you are going it alone and you are just learning about factors like these, you need to find a professional who can advise you, or you'll be waisting your money.

3. Showing your cards. While looking for information on the seller, it's important to divulge as little about yourself as possible. Any knowledge you provide could be used by the seller as leverage. "For example, you may want to pay cash for the house, but the sellers don't have to know that," Camp says. If you are capable of paying cash, the sellers may hold firm to their asking price, he adds, "because it means that you are a person of means."

The first rule of a successful deal, you really don't want it that bad. The second rule of a successful deal, you really don't want it that bad....Shall I continue?

4. Not having options. When you begin negotiating on a specific property, make sure you have identified several other homes you'd be happy with as well. "Never negotiate without options," Brodow says. "If you find a perfect house, find another house so you are not so desperate to buy [the first] house that you wind up giving in to whatever the seller wants." Furthermore, it's to your advantage to tactfully — either directly or through your agent — let the sellers know that theirs is not the only property you are considering.

The biggest lesson I've learned in real estate is to NEVER fall in love with a property, always have several options at any given time. When you decide your going to buy home "X", and only home "X", you get tunnel vision, and you start rationalizing away the danger signs. In one of my first attempts to buy investment property, I overlooked many such warning signs and it cost me several thousand dollars I did not need to spend. Let me explain, after coming to terms on price for the property I scheduled an inspection, notified the seller as to time and date by phone and in writing. On the morning of the inspection, we, (me, the appraiser and an electrician) waited at the property for 45 minutes for the seller to arrive with keys. That should have been it, I should have walked, alarm bells were clanging in my head. But I wanted that property.

This deal made me way smarter about real estate and listening to my "little voice." Learn from my STUPIDITY!

5. Skipping the face time. Instead of handling the negotiation process by phone and fax, it's important to meet the seller in person. "The most effective way to influence or persuade — which is what negotiation is all about — is to do it face to face," says Tom Hayman, the president of Negotiation Expertise, which trains people in negotiation techniques. "Because then you get your words, you get your voice and you get body language — or nonverbals — all into the equation." If the transaction is being handled by real-estate agents, the sellers should request that their agent get together with the buyer's agent in person to discuss the prices. If your agent is unwilling to do so, he might not be the right agent for you. "A buyer should be looking for an agent who is going to do that kind of effort for them, because it always pays off better when it's face to face," Hayman says. (Buyers using agents should be aware that their agent gets a bigger commission on a higher sale price and therefore may have less of an incentive to push for a lower price tag.)

One investor I know often insists on presenting his offers directly to the seller, not through the sellers agent. It's your right in Utah.

6. Offering a specific number. When extending an initial offer, present a range of figures — say, from $420,000 to $450,000 — rather than a hard number. An offer of a specific number that is considered too low could upset the seller enough to derail the negotiations altogether, Cohen says. A price range, however, affords you more flexibility. "In negotiating, you don't want to adopt a position where you paint yourself into a corner," Cohen says. "Because the only way you can get out of the corner is to lose face and perhaps lose a few bucks."

I've never heard of this, it may work, but I wouldn't do it. Before I make an offer, I know what the right price is, and have other options if the seller does not agree. If you want just one home this badly, you're probably too in love with the property and are violating a cardinal rule of real estate.

7. Getting caught up in the game. Remember, your goal is to purchase a home — not beat the seller. "People often get so enmeshed in the negotiation game that they lose the house they like and could afford because they didn't get the negotiation price they thought they could get," says Daniel Shapiro, associate director of the Harvard Negotiation Project and coauthor of "Beyond Reason: Using Emotions as You Negotiate." So what if the seller doesn't bring the price down as much as you had hoped? If you really like the house, the price has been reduced enough to fit your budget, and you've given the negotiation process your best shot, consider declaring victory. "I hear a lot of situations where real-estate deals fail because one side or the other refuses to come down another $5,000," Brodow says. "They don't want to give in, and then it becomes an ego thing."And here is the rest of it."

Negotiating is not a game. There are a lot of misconceptions about negotiating, as if there is some "magic" about getting a great deal. Again, not locking yourself into one property, knowing all you can about the properties your bidding on, and understanding value in the area your looking are the ways successful investors find deals. (real estate negotiating tactics

Centered City Yoga

2008-08-11T10:49:00.000-07:00

"What do yoga classes have to do with real estate," you may be wondering? Well, nothing! I've started featuring locally owned businesses here as a way to promote the best our community has to offer, and to share with my clients and friends why I believe this is a GREAT place to live. No one fits this description better than Centered City Yoga (CCY) and owner Dana Baptiste, so I'm delighted she agreed to humor me and my little blog for an interview!

Click Centered City Yoga

Anyone who attends CCY regularly will attest that this is a place that offers more than Yoga practice. It's comfortable, easy, and accepting of all who want to try, due in large part to the efforts and personality of Dana. You won't find the open competition and braggadocio, or egotistical teachers, "yoga gurus" so common in this industry. Many people tell me they've done yoga all over the US, and nowhere compares to CCY.....

1. How long has your studio been open?

I think it is five years.

2) What initially attracted you to yoga?

The challenge -- it was the best workout I had ever experienced.

3) How often do you practice?

Four days a week, one hour a day of asana; seven days a week, two times a day of meditation.

4) What is rewarding about your job?

Seeing the beauty, grace, and intelligence in others; I love to see people realize they are strong, beautiful, capable, and full of potential.

5) You have two locations now, do you enjoy running the business?

Love running this business; is there a better type of service to offer? If so I haven't found it!

6) There are so many "new age" stereotypes attached to yoga, your thoughts?

I always recommend to people to try Yoga until you find a class that "fits" your authentic self. I don't need to sell yoga as new age hype because I believe in the science of it all. I have read the yoga sutras at least ten times (the sutras, in my opinion, are a list of observations and conclusions based on scientific experimentation done with the "laboratory of the body") and have read all the research I can get my hands on about the effects of yoga on bodies, minds, brains, moods, personality, etc. In short, I trust that Yoga does what it says it will do; I have seen it work way too often to doubt it. and I rely on the yoga (rather than flowery language or personal charisma) to give people the experience that will ultimately be perfect for them.

7) What advice would you give to an aspiring yoga teacher?

Be willing to be real. Don't limit yourself to the "yoga persona." Stay multi- faceted. Don't hide your human qualities in an attempt to appear "above" anyone else.

8) I frequently hear people comment CCY is unique among yoga studios nationwide. Why?

Because all I require from my teachers is that they stay AUTHENTIC, and always honor who their students are -- we put NO ONE on a pedestal at this studio (and if a pedestal starts to be built, there are enough of us who will tear it back down.) No but seriously, I have made it a point to hire only those who have attended my teacher certification program, because it is there that potential teachers truly have the time to explore what it means to BE authentic. When you experience a REAL connection at CCY it is because the instructors are committed to real connections. we are all of us on the same level (teachers and students alike.) Yoga studios aren't always based on that assumption.

9) It seems like you have a definite plan for each class, do you plan ahead of time or "wing it"?

No -- i do not EVER plan my classes -- it would take away from the classes. My intention when I walk into every class I teach is to "let the highest good happen" and "bring out the highest potential" for everyone in the room. How could I PLAN for that? I don't know who will be there!

10) Where were you educated, did you always want to be a yoga studio owner and teacher?

My formal education was at the most awesome UC Berkeley -- can't you tell by the way I use such great punctuation? I wanted to be a diplomat -- I double majored in French and International relations (with emphasis on the cold war) and planned to travel all my life with no kids, no ties, just lots of "relating" internationally . . . . but I took a break to work at a spa before I started my "big career" and have never looked back.

Ultimately, my boys are my greatest teachers and do their best daily to show me all my flaws, hold me accountable to my hypocrisy, and teach me how to be courageously me. So I would say my "INFORMAL" yet true education has come from raising these boys.

11) Yoga seems like a competitive business, any insights on your success?

I will answer that indirectly . . . My very favorite movies are all Christmas movies -- have you seen Miracle on 34th street? Where Santa sends people to other places of business if his place doesn't have what people are looking for? And where the little girl finally believes in something larger than herself?

And my other favorite is A Wonderful Life, about the guy who sees how different lives would be if he wasn't on the earth. Oh -- and another fav -- Rudolph the red nosed reindeer -- wherein we are taught that it is not only OKAY to be ourselves, but that we are all born with a unique purpose and have a responsibility to answer to that in service to each other.

12) In three words, why start a yoga practice?

Equanimity amidst Chaos.

Thanks Dana....I asked a couple CCY veterans and yoga studs to comment on why they love CCY, here are their answers.

Maureen K says

I love Centered City Yoga because you never feel judged and you get all the fabulous benefits of a yoga asana practice in a welcoming and encouraging environment. I'm lucky that Dana was my first teacher....yet I wondered if I would be motivated enough to drive from Alpine (45 minutes each way) 3 or 4 times a week to take a yoga class. Here I am (4 or 5? Can’t remember) years later and I am still driving to CCY to participate in great yoga classes with great teachers in an inviting and accepting studio where I have met GREAT people who I have developed wonderful friendships with – I couldn't’t live without it.

And Kathy A. says....

...the hour + of sweat inducing, heart-pounding movement is over before I know it, and my spiritual journey has been explored and furthered. I trained in dance and performed professionally in the east and mid-west and have never stopped craving the sensation and joy of movement. Centered City's yoga utah style of yoga is the only physical form that satiates that longing. I love working hard and now that the competition is only with myself, my priorities have changed allowing me to reach new places both physically and emotionally. CCY uniquely blends movement and spiritualism in an honest, no-nonsense way.
…..And since this is a real estate blog, let me add that I only wish I lived closer to 9th and 9th, yoga slc ut.

Capital Gains Tax--Rentals

2008-08-11T08:43:00.000-07:00

This one came in under my radar, kind of surprising to see a republican close a loop hole like this for investors. Put simply, the original rule allowed an owner who lived in any property in 2 of the last 5 years to receive a tax free gain up to $500,000.... Yahoo Real Estate Now, owners must pay taxes on gains realized during the time the property was rented. Probably an effort to stop "kitchen table" speculators from biting of more than they can chew in light of our mortgage crises.

by Kenneth R. Harney - Fri, Aug 8, 2008

From Yahoo Finance

For many real estate investors, it was the most profitable tax strategy around: Move into a rental property you own, use it as a principal residence for two years, and convert taxable capital gains into tax-free dollars when you sell or exchange.

But Congress has just clamped a limit on investors' ability to play that game in the future. Under the 2008 housing legislation just signed into law by the President, you'll need to allocate between your investment-use time periods during your ownership of a house, and reduce your tax-free gains accordingly.

Here's a quick summary of the new rules imposed by Congress: There's no change to the basic benefits for taxpayers who use their homes exclusively as their main residence. As long as you live in a house for at least two of the five years preceding a sale, you can qualify for a tax-free exclusion of up to $500,000 in sale profits if you're married or up to $250,000 if you file returns singly.

The big change is for people who move into a house that formerly was rental or investment real estate. Under the old rules, you could move into a rental house or vacation condo, make it your main residence for two years, and convert all the gains built up in previous years into tax-free profits, up to the $250,000 or $500,000 limits.

Starting with properties acquired after next January 1st, however, you'll need to limit your tax-free treatment to the period when you lived in the property -- leaving the gains racked up during rental periods subject to taxes.

Consider this hypothetical example: Say you're single and you purchase a house for $400,000 next January 1 and rent it out. Two years later you move into it and use it as your main residence for the next two years. Then, on January 1, 2013, you move out and begin readying the property for sale. You close on January 1, 2014 for a price of $700,000.

Putting aside your depreciation writeoffs during the rental period, which are treated as taxable income, you've got a $300,000 gain. Under the old rules, you'd get $250,000 tax-free because you met the two years out of five test.

But under the new rules, you only get $180,000 because two years of your total ownership time is allocated to rental use, leaving two-fifths -- $120,000 -- of your gain subject to taxation.

We'll do a follow up on this important -- and tricky -- new tax wrinkle for investors next week. Capital gains tax rate.

Real Estate Forms

2008-08-08T18:07:00.000-07:00

Many want to find real estate forms online. Please use these forms AT YOUR OWN RISK, yours truly makes no claim about he legality of the forms you find online. As always, you should seek the opinion of a realtor and your attorney before trusting the legality of these forms.

real estate forms 1

real estate forms 3

10 Reasons To Hire a Real Estate Agent

2008-08-07T18:19:00.000-07:00

With so much information readily available online, clients sometimes ask me, "Why should we hire a real estate agent?" They wonder, and rightfully so, if they couldn't buy or sell a home through the Internet or through regular marketing and advertising channels without representation, without a a real estate agent. Some do OK, many don't. So if you've wondered the same thing, here are 10 reasons why you might want to consider hiring a professional real estate agent. (real estate agent commission, real estate agent fees) From About.com

1. Education & Experience

You don't need to know everything about buying and selling real estate if you hire a real estate professional who does. Henry Ford once said that when you hire people who are smarter than you are, it proves you are smarter than they are. The trick is to find the right person. For the most part, they all cost about the same. Why not hire a person with more education and experience than you? We're all looking for more precious time in our lives, and hiring pros gives us that time.
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2. Agents are Buffers

Agents take the spam out of your property showings and visits. If you're a buyer of new homes, your agent will whip out her sword and keep the builder's agents at bay, preventing them from biting or nipping at your heels. If you're a seller, your agent will filter all those phone calls that lead to nowhere from lookie loos and try to induce serious buyers to immediately write an offer.

3. Neighborhood Knowledge

Agents either possess intimate knowledge or they know where to find the industry buzz about your neighborhood. They can identify comparable sales and hand these facts to you, in addition to pointing you in the direction where you can find more data on schools, crime or demographics. For example, you may know that a home down the street was on the market for $350,000, but an agent will know it had upgrades and sold at $285,000 after 65 days on the market and after twice falling out of escrow.

4. Price Guidance

Contrary to what some people believe, agents do not select prices for sellers or buyers. However, an agent will help to guide clients to make the right choices for themselves. If a listing is at 7%, for example, an agent has a 7% vested interest in the sale, but the client has a 93% interest. Selling agents will ask buyers to weigh all the data supplied to them and to choose a price. Then based on market supply, demand and the conditions, the agent will devise a negotiation strategy.

5. Market Conditions Information

Real estate agents can disclose market conditions, which will govern your selling or buying process. Many factors determine how you will proceed. Data such as the average per square foot cost of similar homes, median and average sales prices, average days on market and ratios of list-to-sold prices, among other criteria, will have a huge bearing on what you ultimately decide to do.

6. Professional Networking

Real estate agents network with other professionals, many of whom provide services that you will need to buy or sell. Due to legal liability, many agents will hesitate to recommend a certain individual or company over another, but they do know which vendors have a reputation for efficiency, competency and competitive pricing. Agents can, however, give you a list of references with whom they have worked and provide background information to help you make a wise selection.

7. Negotiation Skills & Confidentiality

Top producing agents negotiate well because, unlike most buyers and sellers, they can remove themselves from the emotional aspects of the transaction and because they are skilled. It's part of their job description. Good agents are not messengers, delivering buyer's offers to sellers and vice versa. They are professionals who are trained to present their client's case in the best light and agree to hold client information confidential from competing interests.

8. Handling Volumes of Paperwork

One-page deposit receipts were prevalent in the early 1970s. Today's purchase agreements run 10 pages or more. That does not include the federal- and state-mandated disclosures nor disclosures dictated by local custom. Most real estate files average thicknesses from one to three inches of paper. One tiny mistake or omission could land you in court or cost you thousands. In some states, lawyers handle the disclosures, thank goodness!

9. Answer Questions After Closing

Even the smoothest transactions that close without complications can come back to haunt. For example, taxing authorities that collect property tax assessments, doc stamps or transfer tax can fall months behind and mix up invoices, but one call to your agent can straighten out the confusion. Many questions can pop up that were overlooked in the excitement of closing. Good agents stand by ready to assist. Worthy and honest agents don't leave you in the dust to fend for yourself.

10. Develop Relationships for Future Business

The basis for an agent's success and continued career in real estate is referrals. Few agents would survive if their livelihood was dependent on consistently drumming up new business. This emphasis gives agents strong incentives to make certain clients are happy and satisfied. It also means that an agent who stays in the business will be there for you when you need to hire an agent again. Many will periodically mail market updates to you to keep you informed and to stay in touch.

Where Are We Going?

2008-08-04T10:05:00.000-07:00

So many numbers are out for Salt Lake City real estate, what to focus on? First, economic growth is slowing, according to the US Bureau of Labor Statistics for Utah(ex-farm) our numbers from Jan 2008 through June 2008 are, 2.5, 2.3, 2.3, 2.0, 1.5, 1.1. Projections were for job growth to stay between 2-3%, so these numbers show a disappointing trend. Even so, the fact they are still in positive territory is good news relative to other economies in the west.

So where are we going? My sources tell me rental vacancies are just over 5% for the first half of 2008 (5% is considered "fully rented.") That is good news for investors who want to put money in rentals. Alternatively, job growth will have a major influence on the direction of rentals in the next six months, if growth stays flat or increases, our rental market should follow suit.

Also consider our ranking as #10 for foreclosures nationwide, while St George is hitting the stratosphere for foreclosures, one in 86 homes, that's 1 in 226 statewide. I've said in previous articles I give less "weight" to foreclosure numbers due to cultural factors (lots of young couples buying homes) and our historically high level of real estate fraud.

One more factor is our housing inventory, and home sale figures. Salt Lake County experienced a 28% drop in number of home sales in the second quarter compared to last years numbers, yet prices dropped just 2%. Prices are likely to erode further, but that is HIGHLY dependent on how our economy looks in the next six months.

Put together our numbers stay a wash. Economic growth should lead us out of trouble, if it lags and/or goes negative we're likely to see housing inventory stall, and prices drop another 5-10%.

Consider Condos Utah

2008-07-30T12:09:00.000-07:00

Condominiums sales are tough these days in the downtown/sugarhouse areas of Salt Lake City. As housing spiked in late 2005 early 2006, many buyers who wanted to stay near downtown were forced to consider lesser priced condominiums. As housing is slowing considerably however, the percentage of condos selling relative to total inventory has plummeted.

While the number of condos for sale is 29% higher in 2008 compared with 2005, only 9% are selling today while 23% sold in 2005. That means if your a buyer you have plenty of options, however, prices have yet to come down, indeed average sales price went up 5% from 2007 to 2008. As home prices continue to suffer, like a 29% drop in downtown from 2007 to 2008, once high priced homes will be in range of those who were priced out of the market.

While the numbers do not yet show it, in the next 6 months we are likely to see the percentage of condos selling to rise dramatically, maybe a jump from 9 to 15% on the outside. This means if your shopping for a condo, now might be time to start looking. One caveat, condo buyers should be patient right now. With relatively high inventory and low sales numbers, now is not the time to chase.

You Think You Have It Bad?

2008-07-29T06:41:00.000-07:00

The Case-Schiller home price index is out, national figures dropped a whopping 16% from a high in March 2007 to March 2008. Looking at the same time period in Utah, we had less than a 5% drop in the same period.

The average home in Salt Lake County sold for $300,354 in March 2007, $286,443 in March 2008, or just shy of a 5% drop. Compared to cities in Florida, California and Nevada, where average home sales dropped more than 25%, Utah's should consider themselves lucky.

State program preventing foreclosures

2008-07-28T09:06:00.000-07:00

About 10,000 moderate-income Utahns who purchased homes with the help of the state's first-time buyer assistance program are not only getting through the mortgage foreclosure storm, their default rate has actually dropped by more than half over last year.

By James Thalman
Deseret News

The default rate among moderate-income and first-time homeowners who have lower-than-market interest rates through Utah Housing Corporation has dropped by 52 percent the past fiscal year that ended June 30. That's one foreclosure for every 4,857 households.

During the same period, according to Utah Housing figures released Monday, foreclosures in Utah statewide increased by 141 percent. That's one foreclosure for every 600 households, a rate that is lower than the current national foreclosure rate of one in every 501 but still 10th-highest nationwide in the rate of default increases the past year.

Utah is 10th in the country in increased rate of foreclosures, according to the housing market monitoring company Realty Trac.

The interest break provided to Utah Housing customers is a factor in the decline in foreclosures compared to the national boom in them, company administrators said Monday. But the main reason Utahns who bought homes, financed rental properties or developed special needs housing through Utah Housing have fared better is a combination of responsible lending practices and purchasers buying what they could actually afford.

Utah Housing, which was established by the Legislature in 1975 and has provided less than the going loan interest rate to about 60,000 Utahns, historically has had many fewer delinquencies and foreclosures compared to the rest of the state.

"Moderate-income and first-time homebuyers do not need any surprises when it comes to making their monthly house payments," said Utah Housing President William Erickson. "All of our loan payments are fixed over the life of the loan and not subject to fluctuations like the adjustable or variable rate stuff out there that has led to the subprime mess."

Purchasers themselves must have a verifiable history of good credit and steady employment in order to qualify for Utah Housing funds for foreclosures utah county.

"Utah Housing wants having a mortgage to be a positive experience for our customers, because it has finally allowed them the American dream of home ownership," Erickson said of foreclosures utah.

The company has found several ways to achieve that goal, he said, noting that it offers programs to fund downpayments and closing costs that often total around 6 percent of the loan amount. Homes built by students are discounted for buyers, and the agency also underwrites rent-to-own purchases.

The agency essentially is the state's version of the national Fannie Mae and Freddie Mac loan security agencies established by the federal government.

Fannie and Freddie are in trouble with subprime loans, but Utah Housing is in an enviable position of not being part of the housing bubble, either when real estate was booming or when it burst, he said.

In addition to providing below-market rate mortgages for modest-income homebuyers, Utah Housing also partners with developers to finance affordable and subsidized rental properties around the state. Special needs housing, such as shelters for victims of domestic violence, elderly, physically and mentally challenged, among many others, are also provided through Utah Housing.

Salt Lake County Housing Market Rises 3%

2008-07-24T15:02:00.000-07:00

While Salt Lake City housing is flat, and we have too much inventory, prices went up in the last half of the year!

But when your Salt Lake County property notice arrives in the mail this week, you'll probably find that your home's value has gone up - and maybe your taxes, too.

The county is sending valuation notices to hundreds of thousands of households this week. And they show a 3 percent bump in the average home price.

That's a screeching slowdown from last year's 22.3 percent surge and the 14 percent spurt in 2006. Even so, the latest numbers appear more in line with annual increases during the past decade.

They still seem too rosy for Jim Bringhurst, immediate past president of the Utah Association of Realtors and broker for the Bringhurst Group.
"I'm a little surprised that they are saying there is 3 percent increase," he said. "Overall, I think prices have stayed relatively flat."

Salt Lake County Assessor Lee Gardner insists that his figures follow the valley's buying and selling trends.
"We reflect what is happening in the market," he said, pointing to real estate data showing the county's average home price rose to $268,036 from $255,823.

The county reports its highest gains in the upper-scale neighborhoods along the east bench, while southwestern suburbs such as South Jordan, Herriman
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and Riverton suffered a 1.3 percent dip in property values.

The lingering question: Will higher home values mean higher taxes? The answer: Maybe.
Because of Utah's truth-in-taxation laws - which limit how much money governments can collect on existing properties without raising rates - homeowners will see their county bills bounce only if their properties appreciate faster than the valleywide average.

Salt Lake County Mayor Peter Corroon says homeowners can be assured of one thing: He won't pitch a property-tax boost this year to balance the county's financially strapped budget.
"I've learned that you start with frugality before you spend money on things that you want."

But it's going to be tough for the Democratic mayor, who faces re-election this fall, and the Republican-led County Council. County financial gurus forecast a $5.3 million shortfall in sales-tax revenues.

Corroon, who says cash reserves will make up much of the difference, has ordered a hiring freeze and urged departments to flatten their budgets.

Yet even without a tax hike, the numbers undoubtedly will irk thousands of property owners. Last year, the county heard 6,500 appeals.
"If the expectation of the public is that values have tanked, then they will look at it as sticker shock," Gardner said. "But if people are attuned to what is happening in the market . . . then they will look at it and say, 'Yeah, I think things are fine.' "

Salt Lake County has heard an average of 6,700 appeals a year since 2000. That represents about 2 percent of the county's total property owners.

Economist James Gander has found the battle worth waging. He's won lower tax bills before and continues to challenge his valuation for 2007.

While Gander has yet to see this year's property notice, he doubts that the county's housing stock really has appreciated as much as the assessor says it has.
"Even 3 percent sounds too high," he said.

So what about the future of the county's real estate market? It's creeping upward, according to the assessor's records. Since valuations were set in January, the average home price has jumped 3.7 percent - now reaching $278,042.

As for Bringhurst, he says his Sugar House real estate group is thriving. The housing market certainly has slowed, but he believes the Beehive State will escape the hard hits experienced elsewhere.
"It's busy for us."

I've Heard Times Are Hard....

2008-07-21T11:20:00.000-07:00

But this takes the cake, and in my home state of Minnesota no less! Here in Utah (I'm sure Minnesota is the same) we have electronic keys which record every home we enter, and is stored on a central database. And they say realtors aren't the smartest bunch!.

MINNEAPOLIS (Map, News) - A real estate broker is facing charges after he allegedly stole pain medication from houses he had claimed to be showing to clients.

One homeowner told police he came home Tuesday to find his dog locked in the garage and pain medication missing from his kitchen cabinet.

The 64-year-old real estate agent was in the Hennepin County jail awaiting formal charges.

Minnetonka detective Sgt. Dave Riegert says police have linked the real estate broker to the theft Tuesday as well as to one in June. Police believe they'll find many more homes involved.

According to a police report, the man had a sock containing 85 pills in his car. He was arrested Tuesday at a scheduled home showing.

Real Estate Fraud--Lessons?

2008-07-17T19:31:00.000-07:00

We're all probably more susceptible to scams than we would like to admit. I've been fortunate in my still relatively young real estate career to have a mentor, Dave. After a career as a fortune 500 executive, Dave retired in his forties to enjoy the good life. Soon enough he was bored, and decided if other people could invest in real estate, so could he.

Lucky for me, Dave did much of my learning for me. After working with Dave for nearly 18 months, I know I have learned a lot, but I also realize just how little I knew when I first started. Indeed, I thought, people buy and sell homes every day, average people flip homes on TV! If I can pass the bar exam and do trial work, surely I can invest in homes.

I now understand how naive I was, and how LUCKY I am to have someone like Dave who not only buys my rounds, but teaches me when there is nothing in it for him (Thanks Dave!). I don't know if I would ever have fallen for a scam like the one described below, but I know I'd probably have made my own expensive mistakes. Real estate can and should be very profitable, but one mistake can permanently end what should be a long and profitable career. My advice to my friends is always ask me anything at all, even if we are not doing business!

Enjoy the article.

The ads said, “Dare to Dream,” and Jeff Denison was among dozens who did. Now his dream is a nightmare.

All he had to do to get into Utah's red-hot real estate market in 2006 was sign a contract with Dare to Dream Investments. That signature allowed his good credit to underwrite the purchase of a building lot and construction of a house.

He didn't have to lift another finger. Dare to Dream would do it all for him: Find the lot, hire the contractor, sell the house. He would get 55 percent of the profit right off the top. No muss, no fuss.
Denison liked the program so much, he signed up for two houses.
Now he's left holding the bag on two $300,000 mortgages beyond the one he owes on his actual home. And with the mortgage-credit crunch, not to mention the spiraling cost of gasoline, houses in Grantsville aren't selling to Wasatch Front commuters like they once were.

Making matters even worse, the structures have piles of liens against them by subcontractors who didn't get paid. Denison is struggling to find money for them, too.

“The biggest thing I've lost is my good credit [rating],” he said. “I'm trying not to go into foreclosure. But I've had to go 30 days, 60 days late [on mortgage payments]. I just can't keep up with it.”

His houses are among 42 built in Grantsville's Silver Fox
development by Dare to Dream investors. All but three remain empty, creating a modern-day ghost town.

Denison and other investors in Silver Fox properties say they were “misled” but have not filed suit against Dare to Dream or its sister company, Transform America Mortgage. Some are contemplating legal action; others are unsure whether it would be worthwhile.

But two other groups of Dare to Dream investors in Layton and Lehi projects have filed suit in U.S. District Court for Utah, claiming they were victims of fraud.
One action, filed in October by Gregory Waddoups and other investors in Layton real estate, says, “Dare to Dream does not disclose the risks or possible repercussions of the investments scheme . . . the investor is liable for any overages that may occur through the construction of the project.”

Waddoups' attorney, Brennan Moss, said in an interview that Dare to Dream's building lots were purposely appraised higher than their actual value, and contractors schemed to under-estimate building costs, believing they could get additional funding from investors once the houses were under construction.

“Dare to Dream profits from the scheme in an amount that is directly related to the appraised value of the lot,” according to the suit.

Moss said some of his clients are left with mortgages of $600,000 to $700,000 on homes that are worth only $450,000 in today's market. Some of the houses have not been completed.

“The real estate fraud may have worked for a time when housing prices were going up rapidly,” he said. “But Dare to Dream played fast and loose. It's terrible. It's devastating.”
Although Moss named a dozen defendants in the lawsuit - including appraisers, loan officers and builders - he lays most of the blame in the lap of Kimberly Schneider, of South Jordan, who ran Transform America Mortgage and Dare to Dream.
In March, Schneider filed for personal bankruptcy. Transform America Mortgage and Dare to Dream no longer exist.

In an interview, Schneider, a divorced mother of six, denied fraudulent activity. And she is broke, she said, to the extent she can't even hire a lawyer to defend against the lawsuits.

Among other things, Schneider blames the fiasco on the national credit crisis and the real-estate slump that followed.
“The market crashed in July [2007], and we couldn't close our loans,” she said. “I cried the entire month. It's my entire world.”
The lot appraisals and construction bids were all independent, she insisted - not part of a scheme.

Schneider explained that her parents lost their life savings in the Dare to Dream venture. She, too, poured all of her own money into the program in an effort to keep it afloat. And her brother holds mortgages on two houses he purchased through Dare to Dream.

“If we were doing any form of fraud, would I expose them like this?” she asked, noting that investors were left with properties, while she has nothing. “The money that was lost was our money.”

But Wesley Hutchins, an attorney for Marylee Asay and the Lehi group of investors who filed suit last month, said some of his clients have lost their Dare to Dream houses through bank foreclosures.

“Dare to Dream left my clients in dire financial circumstances,” he said. “It was speculation with other people's money and without full disclosure.”
Schneider and others involved with Dare to Dream cannot simply declare bankruptcy and walk away, Hutchins said. He has filed a complaint against Schneider in bankruptcy court, seeking to collect damages from any present or future assets and even future wages.

The Utah Division of Real Estate has heard plenty of complaints concerning Dare to Dream, according to Director Mark Steinagel.

While not commenting specifically about Dare to Dream, he warned potential investors against schemes that look too good to be true.

“We often hear of people trusting a little too much,” he said. “Their credit gets ruined, and they have people after them for construction liens.”

Steinagel said that when land appraisals are artificially inflated to generate loans of more than the land is worth, “it's a classic case of real-estate fraud.”

Sugarhouse (84105) By The Numbers

2008-07-17T11:23:00.001-07:00

I love this area of town, it's where I call home! 84105 is proving to be an oasis of calm on our otherwise slowing market. There are many reasons, the most obvious is it's close to everything, like the Universities and Downtown. There's a trendy feel in 84105 while still providing the character and calm of "anytown USA." If you're a yuppy, a hippy, or a working professional who enjoys good restaurants and city access, there's a good chance you live here. Consequently, its the perfect area for investors looking for rental properties or other investments.

While other areas of our city have seen harsh declines, zip code 84102 and the Avenues have both seen a 29% decrease in number of listings sold from 2007 to 2008. In this same period, 84105 has seen a 4% increase. Compared to once steamrolling areas like Draper (84020) has seen sales drop from 27% to 17% of listings sold from 2007 to 2008.

The following figures are comparables of January to July 15, 2005 to 2008 for zip code 84105. In 2005 67% of all listings sold for average price of $244,000, in 2006 it was 49% at average of %298,000, in 2007 36% at average of $334,000, an in 2008 40%sold at average of $316,000.

I believe this is one of the best areas to buy in now and going forward. It's location means it will remain one of our most stable, and sought after areas. Indeed, if gas prices stay high, owning property in 84105 will be one of the smartest choices you can make.

Best,

Matt

French Neighbors?

2008-07-15T07:24:00.000-07:00

With the US Dollar hitting an all time low against the Euro at $1.60, smart investors abroad are likely eyeing US properties. For those unable or unwilling to sell their homes at today's prices, an influx of foreign cash may be welcome. With our resorts and world class outdoor opportunities, Utah might get a share of these foreign dollars.

(From Invest Abroad Blog)

With a devalued U.S. dollar against many other foreign currencies (i.e. Euro, Pound Sterling, etc.), now is the best time to invest in luxury real estate in the United States.

Whether this initiative is part of your diversification strategy or not, your property investment(s) in the United States will pay off in both the short and long term. Namely, your purchasing power is greater today in the United States and your ability to create greater returns in the future is increased tremendously.

To further exemplify present investment trends, I recently came across the following article “U.S. Real Estate Tops Foreign Investors’ List, Interest in Asia Grows” posted in the July 7, 2008 issue of www.Bostonsf.com.

The commentary reveals that, based on the results of the recent 16th Annual AFIRE Foreign Investment Survey, the U.S. real-estate market is at the top of global investors’ list.

Furthermore, “with 56% of the votes, the U.S. again emerged as the most stable and secure country for real-estate investment. No other country has ever come close to this number-one position. The second-ranking country has historically been the U.K., but this year Germany, with 10.5% of the votes, took that honor; Australia and the U.K., with nearly 9% of the votes, tied for third place.”

Agreeably, “this year, New York City and Washington, D.C. were named foreign investors’ top global cities. New York City leaped ahead by a substantial margin to be named the top global city, followed by Washington, D.C. and London in a tie for second place. Last year, New York City was ranked second globally and Washington was ranked fourth. Paris fell from second to fourth rank.”

Directly involved with global real estate on a day-to-day basis, I find such figures and trend eye-opening.

And here is the rest of it.

Utah #10 Nationally In Foreclosures

2008-07-14T12:09:00.000-07:00

A recent Salt Lake Tribune article subtitled, "Welcome to Utah, one of the new foreclosure capitals of the United States" gives a depressing impression about our real estate market. While I don't dispute the statistic, there is a false implication in the story about the overall health, or lack thereof, of our real estate market.

Utah is always at the top of the list in mortgage fraud and I believe the foreclosure statistic is in this same vein. Indeed, in a culture where people are encouraged to settle down and raise families early, its not suprising to see a higher relative percentage of people biting off more debt than they can chew. The reason I don't see these kinds of problems as an overall indicator of our real estate market, is that our job growth and rental vacancy numbers, to name just a few, are still quite strong.

Here's the the article from the Tribune.

After years of economic prosperity, Utah now has the country's 10th highest home foreclosure rate. One in 600 households in the state is in some stage of losing a home because the homeowner is behind on loan payments, according to RealtyTrac, a service that tracks foreclosure filings nationally.

In June alone, 1,501 households received some type of foreclosure-related filing, up 141 percent from the same month last year, RealtyTrac said. National foreclosure filings were up just 53 percent.

Utah's foreclosure rate still remains below the national rate - one for every 501 households. But it is now higher than all but nine states.

With the state enjoying one of the country's strongest economies in recent years, the rate of Utahns losing homes has been low. But over the past year, employment growth has slowed significantly and the once booming real estate market lost much of its steam.

Home sales in most areas are down significantly from a year ago, and Utah now faces the specter of falling home prices, a problem that has plagued much of the country for more than two years.
''The [national] foreclosure problem is getting worse and will stay with us well into the next decade,'' said Mark Zandi, chief economist for economic forecasting service Moody's Economy.com. ''The job market is eroding and homeÂowners have less equity. Lenders are much less willing to work with you if you've got negative equity, and you're more likely to give up your house if you're deeply underwater."

Among 230 metro areas, Provo-Orem was 37th nationally in foreclosures, while the Salt Lake City area was No. 89. Ogden-Clearfield was 115th.

People are losing homes for various reasons. A less favorable job market may make it difficult for someone who loses a job to find another quickly enough to stay current on a loan.

Years of home-price run-ups have left houses unaffordable to many buyers. And tighter lending standards enacted because of the subprime lending debacle make it difficult for many to qualify for a home loan. With fewer buyers, inventories of homes for sale are piling up, making it more difficult to sell a home quickly enough - and at a high enough price - for families falling behind on their mortgages to avoid foreclosure.

Housing advocate Kim Datwyler, executive director of Neighborhood Nonprofit Housing Corp. in Logan, said a number of borrowers facing foreclosure have adjustable-rate mortgages that are now resetting at higher rates, pushing monthly payments higher. Due to tighter lending criteria, many cannot qualify for fixed-rate loans with lower monthly payments.

Datwyler and other housing advocates are urging those in trouble to contact the Housing Education Coalition, a network of public and nonprofit agencies that counsel people in danger of foreclosure.

Many families facing foreclosure were current on loans until encountering an unexpected medical problem, loss of a job or another hardship.

Kim and Howard Nivison of Richmond trace their troubles to the day he was hit by a car while crossing a road near his family farm on an ATV. A traumatic brain injury and other physical ailments preclude him from managing the farm or working an outside job.

Kim Nivison felt helpless as she and her husband used up their savings to stay afloat. Then she heard about Neighborhood Nonprofit and called for help. The agency helped her secure a new loan with a lower monthly payment.
"I would tell anyone having problems to call right away, even before they miss that first payment," she said. "The sooner they call and get the help, the better."

Thanks For Visiting My Website!

2008-07-07T08:02:00.001-07:00

Taking the week off to visit Glacier National Park, see you all July 10

Best,

Matt

Attention Investors! Latest (Unofficial) Rental Vacancy Data....

2008-07-02T10:47:00.001-07:00

The official rental vacancy numbers for Salt Lake City should be out in the next three to four weeks, so these numbers are not yet set in stone. That said, my associates from several property management companies in town suggest our vacancies will rise just 1/2% to 5%.... in the first half of 2008, the rate at which markets are considered FULLY RENTED. This is fantastic news for investors who are eyeing deals and are counting on an uninterrupted rental stream to make those nasty mortgage payments.

In 2007, Salt Lake City rental vacancies were 4.5%, with an 8.8% growth in rental rates. Local property managers suggest landlords continue to raise rents in the first half of 2008, up between $60-$80 for remodeled and/or updated residential units. This momentum is especially striking comparing our market to others in the West. For example, Phoenix rental vacancies stand at 11.5% for the first quarter of 2008, up from 9.6% in the first quarter of 2007!

Looking Forward

As long as our employment numbers hover around the May 2008 figure of 1.6% (US Bureau of Labor Statistics), housing inventory should continue to decline and home prices will stabilize. That said, the May figure was slightly lower than predicted, so June's number will be telling about the road ahead. I'll be updating this figure as soon as it's out in mid-July, but continue to believe we will see moderate growth in the near term.

Best,

Matt

Unique Home Of The Week

2008-07-01T15:10:00.001-07:00

Doing Business With Family?

2008-07-01T14:38:00.001-07:00

How do you feel about doing business with family?.

When I was a youngster my electrician father frequently brought me along to various job sites. I remember walking through the Kraft plant in my Midwestern hometown in awe of the huge milk tanks, tubes and machines of all kinds. My favorite was the blue cheese machine. I loved watching workers place blocks of cheese between the long opposing metal spears (they looked a lot like knitting needles) that would make holes in the cheesse which, over the aging process, grew mold making the "blue" in blue cheese! To my fathers frustration, my daydreaming often distracted me from my assigned task as wire puller and gopher.

Which brings me to my point, would you hire your relative to be your mechanic, realtor or lawyer? Obvious plusses are you know your relatives, you may have even grown up with many of them and can attest to their character. Alternatively, what happens when your cousin dissapoints and you'll be seeing each other over Thanksgiving?

I'm curious, how do you select your service people, doctors, lawyers etc? Is it family all the way or "just on holidays?"

So You Want To Be A Landlord?

2008-06-27T08:12:00.001-07:00

What a great idea, but read this first and learn from some of my mistakes and near misses.... In this first of a series of articles on land lording, we'll look at avoiding the trap of buying properties with inflated or unreasonable rental rates.

As most of you already know, rental properties are valued by taking the yearly rental income, deducting for vacancy, and adding the rate of capitalization. This simple equation (please contact me for details) will determine whether the property is accurately priced. But if the seller has raised rents to levels that are unreasonable for the area, or is being deceptive about actual rents (not uncommon), you may be dealing with a mirage.

The typical scenario looks like this, investor buys down on the heels duplex for a relatively low price, kicks out tenants, does an OK job fixing the place with new paint and carpet, paints the outside, maybe some new appliances and fixtures. Investor finds new tenants at rental rates on the high end (unreasonable) for the area. He/she owns the property for a year, then based on the increased monthly rentals lists the home for sale at a considerably higher price. Lets call this the "rental flip."

You may be wondering what unreasonable rents are, or, if the seller is actually getting a certain rent, why say that rent is unreasonable? Rents are unreasonable when good, qualified renters, those with solid credit and a strong rental history, won't rent from you. They won't rent from you because they have their act together and know you are overpriced, and are sought after by land lords who know the true value of good tenants. "Bad tenants," or those with spotty credit, work and rental histories will be forced to live in two types of rentals, dumps or nicer rentals with inflated and unreasonable prices. Landlords who rent their nicer units to "bad tenants" take this route believing the higher rents will make up for the increased risk. This is a losing strategy from day one, as tenants with bad credit and/or rental history don't really have anything else to lose by walking out on unpaid rent, or from a trashed apartment.

So what should the novice investor watch for? First, rental properties which have been owned for a short time. While none of these rules are universal, this is a clear signal to put up your guard and look closely at the offering. I always ask for copies of the last three years leases so I can see when the last rental increase occurred. This brings us to our next point, knowing the rental market.

The only way to make a good purchase decision is by personally understanding the rental market. I'm hammering this point, but nothing will ruin your land lording future as much as overestimating your rental stream and overpaying for your investment. If you don't have a deep understanding of rents in our valley, go to a rental agency and tell them to show you some apartments, or tour apartments for rent on your own.

Lastly, let me emphasize, when your dealing with fellow investors the waters get deep and swift. More than any other time in life, NOW is not the time to play "trust me." Never take the stated rents as fact, make the seller provide written leases. In the end, if your seller hasn't kept accurate records or makes another lame excuse, that's a bad sign and you should WALK.

This is a great way to invest your money if you do it the right way and protect yourself.

Best,

Matt

Summit County Conundrum?

2008-06-26T10:15:00.000-07:00

While things have cooled in Summit County, any real pain isn't likely. Recent numbers indicate while the number of home sales is dropping off considerably, average sales price and number of listings CONTINUED to rise through the first half of 2008. Home prices have some falling to do, but will escape the carnage of SLC or other major areas of the west.

Indeed, sales figures in the Avenues have plummeted 29% from 2007 to 2008, while in the same period Summit county prices rose 1%. Year over year statistics (ex-condos), January 1-June 24 2005-2008, indicate strong growth and paint an interesting picture. In 2005 32% of all listings sold for an average price of $550,903. In 2006, 07, and 08 the percentage of listings sold were, 23%, 19% and 9% for average prices of $807,729, $929,057 and $946,091 in these years respectively.

It's harder to give an accurate picture of the road ahead than it would be for the Avenues or other areas of SLC, as Summit County sales are highly dependent on out of state buyers of second homes. For those with the resources to afford these properties, price consciousness is less of a factor than for those of us in the middle class. That said, many owners in resort areas likely made purchase decisions based on an increase in net worth from properties they own in other hot markets like CA, AZ or NV. As they experience losses in these markets, many will be forced sell. The unknown factor will remain whether there are enough high end buyers to pick up the slack.

I believe while Summit County is unique to SLC, the totality of housing woes and a slowing economy mean the price declines have still yet to come. I would look for a 10-15% price decline over the next year. I would not anticipate anything close to a return to 2005 prices, but rather a softening in the average sales price to around the low-mid $800,000 range. It's still too early, but this is an area I would continue to keep an eye on.

The following is an AP story regarding the fate of Western resorts and Park City.

Best,

Matt

PARK CITY, Utah - With the developer forced into bankruptcy, Hugh Smith worries about the $1 million he and a partner sunk into bare lots at Promontory, a half-built, sprawling residence club in a post-Olympic town saturated with second homes for wealthy baby boomers.

By Paul Foy • The Associated Press • June 25, 2008

As Promontory began showing signs of distress a few months ago, Francis Najafi, chief executive of Phoenix-based Pivotal Group, gathered members together in an opulent timber-and-stone clubhouse and said he was in default and was pulling out.

"He was telling everybody he was sorry for our troubles and blaming events beyond his control - the nation's real estate," said Smith, who believes Promontory will bounce back in a year or two under new ownership. He still hopes to develop two lots with multimillion-dollar vacation homes for sale.

"The project is not in trouble other than Francis Najafi decided to pull money out of it," said Smith, holding his anger in check. "We can't wait until the court decides who's going to be in charge."

Promontory is among Western vacation spots facing financial uncertainty or worse, including Nevada's Lake Las Vegas golf resort, Idaho's Tamarack Resort and Montana's venerable Yellowstone Club. Sales are off at other resorts in the region, according to the Rocky Mountain Resort Alliance.

Overdevelopment is one of the problems.

Around Las Vegas, a quarter of all housing sales on the market are listed as short sales, going for less than the loans owed on them. On the Strip, plans for 24,700 condominiums are on hold or have been canceled, according to research firm Applied Analysis.

"Many of them were speculative projects to start," said Brian Gordon, principal of Applied Analysis, which tracks the market.

At the more exclusive resorts, the market had seemed recession-proof, with buyers generally paying cash. They had nothing to do with the failing subprime loans that are causing market turmoil. But the turmoil is making banks less forgiving for resort developers who took out huge construction loans.

Credit Suisse bank says Najafi defaulted on a $275 million loan in December and told a loan officer he had no money to pay for anything at Promontory. Najafi and other Pivotal executives declined repeated requests for interviews. The bank said it wouldn't comment beyond court papers.

Credit Suisse also is trying to call in a loan at Tamarack Resort, one of the nation's newest ski resorts, about 100 miles north of Boise. In Nevada, at Lake Las Vegas - a golf community 17 miles from the Strip that defaulted on $540 million in loans - a group of lenders led by Credit Suisse forced the development into new ownership at the start of the year.

"We're not out of the woods," said Frederick Chin, chief executive of Las Vegas-based Atalon Group LLC, which is trying to salvage lenders' investments at Lake Las Vegas, where homes cost up to $10 million. "There's a lot of financial problems here, a lot of legal problems we're sorting through, and our journey is at the beginning."

The bank says Yellowstone Club is current on its loan, but that club faces other troubles.

A divorce of the owner and his wife has turned into a nasty battle for control of the club. In another dispute, a group of charter members led by cycling legend Greg LeMond are fighting for their shares of equity.

The Yellowstone Club received a $375 million loan from Credit Suisse in 2005, but members say little of the money was spent on the resort - the $100 million Warren Miller Lodge, named after the ski filmmaker, now 83, is still unfinished. The resort didn't respond to requests for comment.

The Yellowstone Club opened in 1997 with a private ski area for members near Big Sky, Mont. Its members include Microsoft's Bill Gates.

Some vacation-home buyers seem to be becoming skittish. Accustomed to depressed Southeast and West Coast markets, they are looking for bargains, but equally well-heeled owners are refusing to cut their prices. "This is really upsetting to the buyers, so they're just not buying," said Dennis Hanlon, president of the Rocky Mountain Resort Alliance. "Both parties are upset."

The standoff has chilled sales at major resort towns in Colorado, Idaho, Utah, Wyoming and British Columbia. Sales at 11 resorts that belong to the alliance in those locations plunged by nearly half in the first quarter from a year ago, Hanlon said.

"There's no doubt about it. Our volume and number of transactions are down," said Tyler Richardson, president of Park City Board of Realtors. "But if you look at median sales prices, they're stable."

Park City is still considered a bargain by the wealthy, and real estate agents believe it will rebound after some casualties. Basketball great Michael Jordan has a house in Glenwild, Utah, which is financially sound. Golfer Tiger Woods is a regular and low-key visitor to Deer Valley Resort, which launched Park City's transition in the 1980s from a tired old mining town.

The area's transformation into vacation-home hot spot, which picked up after the 2002 Winter Olympics, has clearly chilled.

"We're chugging along. It's not like we're knocking them dead," said Jake Doilney, owner of Glenwild Realty, who said 10 homes averaging nearly $4 million apiece were for sale, then had to update the count to 11 in the middle of a conversation.

Glenwild members pay a one-time fee of $115,000 for a golf membership plus annual fees of $9,600.

"They're buying a lifestyle, and the subprime fallout and gas prices have very little impact on a buyer like that," Doilney said.

Yet some developers are running out of cash or income.

Promontory, for one, can't sell any resort-owned lots because of legal wrangling. Bankruptcy petitions have been filed but no hearings have been held. The developer is taking reservations instead. Owners can still sell their lots, but it's not a great time to try.

In the meantime, Credit Suisse says, developers of Tamarack Resort, a ski and golf community, are in default on a $250 million loan.

"We're still a financially viable resort," said Ken Rider, director of marketing and sales at Tamarack. "Our hospitality and recreation options are nearing break-even in profitability even through financially challenging times."

Other developers may be finding buyers scarce. At a defunct ski area in central Utah, backers of a resort community won't say how many $1.5 million building lots they've sold after more than a year of trying.

The Mount Holly Club - where membership fees for skiing and golf will be $24,000 a year - exists in concept only. The partners say they plan to build a gatehouse this summer as a show of confidence in their plans.

New Website Allows Search For Perfect Neighborhood

2008-06-24T09:35:00.000-07:00

The team behind eppraisal.com today announced the beta launch of hoodeo(TM) (www.hoodeo.com). Hoodeo answers the question: where are my best places to live?

Hoodeo allows consumers to start their home search by first knowing where to look. Whether consumers are relocating within an existing city or state, or moving to an entirely new area, hoodeo helps them determine which neighborhoods fit them best.

Eppraisal.com President Damian Scott says, "Hoodeo is a new approach to finding and buying the home of your dreams. Rather than searching for a home and ending up in a neighborhood, hoodeo allows you to find a great neighborhood first and end up in the perfect home." Hoodeo goes one step beyond traditional "best places to live" lists by understanding its users' preferences first before matching them with their personalized best places.

Dubbed "The Neighborhood Matchmaker," hoodeo learns about its users through a series of questions about their lifestyle, desired property type and price range. That information is used to match them with potential neighborhoods that best meet their criteria. Matches are ranked from one to 10, with No. 1 being the best match.

For each match, users can then search available properties for sale. The property listings are provided by real estate search site Trulia(R) through a hoodeo-branded Trulia Publisher Platform site. Additional features include the ability to share matches with a friend and get an eppraisal -- an automated value range from eppraisal.com -- for each property listing.

Upcoming features include the ability to save matches, connect with real estate professionals as well as other users who have similar profiles, and contribute to neighborhood and community information.

"With lenders easing mortgage restrictions and home prices continuing to drop, now may be the time to scoop up the home you've always wanted," says Scott. "Start your search on hoodeo to ensure you find a neighborhood that fits your lifestyle and meets your needs."

About eppraisal.com

Eppraisal.com provides home values, neighborhood information, and market analysis to consumers. Homeowners, buyers, and sellers can take the next step by connecting with local real estate professionals -- mortgage brokers, agents, home inspectors and appraisers. For more information visit eppraisal.com.
And here is the rest of it.

Selling--What You Risk When You Overprice Your Home

2008-06-23T11:42:00.000-07:00

Good realtors will not overprice your home! Indeed, good realtors will often REFUSE to list your home for a price that is too high or uncompetitive for the market. That's because realtors don't set home prices, any more than stock brokers set stock prices. In markets like these, if you want your home to sell it must be the "CLEAR VALUE" for consumers. Below I detail 7 reasons why overpricing your home can cause you unnecessary pain.

1. You will lose the excitement that a new listing generates. Most activity on a listing comes within the first 30 days. An initial high price will discourage buyers causing you to miss out on pent up demand.

2. You will lose the most qualified prospects! Buyers will not "just make an offer" because they probably will never see your property. They will view the properties that are priced within their purchase power range, knowing that they cannot afford anything above their price ceiling.

3. Overpricing helps sell other, more competitively priced homes first. Your home may be used to demonstrate the good value of other properties. Your objective should be to enter the market in a position that will attract prospects, not drive them away.

4. Your home may become stale on the market. Prospects may wonder why it has been on the market too long or if something is wrong with the property, even after you lower your price. You may even have to settle for less than market value. A house takes on a reputation (especially among agents like me who SCOUR the MLS daily) surprisingly fast, don't wear out your welcome.

5. If you do get an offer, the contract may fall through because of appraisal problems. The lender may not be able to justify the price as it relates to loan value, considering it a high risk and refusing to lend the buyer mortgage
funds.

6. You lose a strong negotiating position when your home is on the market a long time, both financially and mentally! Prospects will not "rush" to make an offer on overpriced property, indeed they will likely target your property as a low ball opportunity. As an investor I know this dynamic well. Investors and those looking for deals often TARGET stale listings because they know the kind of position you're in. They know that other people have probably stopped looking at your home, and that gives them a stronger bargaining position.

7. It bears repeating, the agent you list your home with cannot set the sales price of your home any more than your stock broker dictates the price of a stock sale. The selling price is simply a function of supply and demand. Never let an agent "buy" your listing by offering to overprice your home (inexperienced and unsuccessful realtors often do this, as some business is better than none.) Most unsold listing that expire on the market are due to poor pricing, subjecting the owners to the risks discussed above. Select your agent on their market knowledge, negotiation skills and their ability to reach the market. Above all select someone you trust!

Statistical Analysis--Alpine 84004

2008-06-23T10:56:00.000-07:00

For all my new friends in Alpine, year over year sales figures. I started my search from January-June 20, 2004 doing year over year comparisons for the same periods in each year, 05, 06, 07 and 08. Alpine is seeing a drastic slowdown from previous years, indeed 2008 numbers most closely track 2005.

In 2004 there were 118 listings, with 31 sales or 26% of new listings selling in an average 102 days on market. In 2005 there were 117 new listings with 37 sales or 31 % of listings selling in 87 days on market. 2006 saw 123 new listings with 47 sales or 38% in 81 days on market. 2007 say 133 new listings with 36 sales or 27% in 90 days on market. Finally, in 2008 for January 1-June 20, there were 127 new listings with 18 sales or 14% in 67 days on market.

You'll note the slowdown in relative number of homes sold, what is perhaps more notable is the average sales price for Alpine. Because Alpine is made up of mostly relatively higher priced homes to most areas, perhaps the effects of a lack of financing opportunities and the slowing economy is taking a bigger toll here than elsewhere. In 2004 90% of homes sold in this period sold for just over $490,000, in 2005 91% sold for over $500,000, in 2006 93% if homes sold for over $600,000, in 2007 91% sold over $700,000, and 2008 plummeted to 77% of homes selling over $500,000. From its high in 2007 to now thats a roughly 29% loss in value.

Two Utahns among those nabbed in FBI mortgage fraud probe

2008-06-20T13:19:00.000-07:00

Only two eh, not quite keeping up with our image as the fraud capital of the country. Federal authorities announced Thursday a sweeping crackdown on mortgage fraud that has led to charges against more than 400 people nationwide, including two Utahns.

The announcement, made by the U.S. Department of Justice and the FBI, involves cases pursued in just the past three months that resulted in an estimated $1 billion in losses.

State Rep. Paul Ray, R-Clinton, who has worked in recent years to pass legislation aimed at reducing mortgage fraud in Utah, applauded the agency's decision to announce the hundreds of cases at once.
"The only way to send a message to the public that there's a chance you're going to get caught is to throw 400 indictments out there at one time," Ray said.

Nationally, those charged under operation "Malicious Mortgage" include a host of people related to the real estate industry, including brokers, borrowers, lenders and even two former Bear Stearns managers in New York, who are the first executives to face criminal charges stemming from the collapse of the subprime mortgage market.

The two Utahns are Jerry C. Huff, 49, of Hurricane, and Bryan D. Conrad, 37, of Salt Lake City. Each was indicted on separate and unrelated charges relating to mortgage fraud.

Authorities say Huff lied to convince a bank to provide him with a $250,000 second mortgage on his home in Moab, a loan on which he has failed
to make payments.

According to the indictment, Huff lied about the condition and value of his home, overstated his income and submitted false documents, such as a fake appraisal, so that his loan would be approved.

The indictment also says Huff submitted copies of personal tax forms as part of his loan application when in reality he hadn't filed tax returns for those years.

Huff faces one count of wire fraud, which carries a maximum penalty of up to 20 years in federal prison; two counts of money laundering, with a potential maximum penalty of 10 years in prison for each count; and two counts of failure to file a tax return, which carries a maximum penalty of one year in prison for each count.

According to the indictment, Conrad used false identities to apply for loans. He faces two counts of bank fraud, which carries a potential penalty of up to 30 years in federal prison for each count in addition to a $1 million fine. He also faces charges of aggravated identity theft, which has a two-year mandatory minimum sentence.

Nationally, banks reported nearly 53,000 cases of suspected mortgage fraud last year, up from more than 37,000 a year earlier and about 10 times the level of reports in 2001 and 2002, according to the Treasury Department's Financial Crimes Enforcement Network.

The most common type of mortgage fraud was inflating income or assets to qualify for a loan, followed by forging documents, inflating appraisals and misrepresenting a buyer's intent to occupy a property as a primary residence. Loans based on primary residences are looked at more favorably by lenders.

Utah is ranked fifth nationally in loans showing signs of fraud or misrepresentation on a per-capita basis, based on 2007 data analyzed by the Mortgage Asset Research Institute, an affiliate of information provider ChoicePoint.
Ray said Utah needs more people to investigate and prosecute such crimes.
"This is such a big problem, we don't have enough people to deal with all of it," he said.

Cost of gas is influencing housing purchases

2008-06-19T11:52:00.000-07:00

Read my post from yesterday regarding gas prices. You know what they say, even a broken clock is right twice a day!
An article from MSNBC discusses how urban homes, and homes good for commuting are holding value better than suburbs. Any of the zip codes in and around Salt Lake City will continue to be great places to by homes, and perhaps homes near our new Front Runner train service will also be solid. Zips including 84101,84102,84103,84105,84106,84108,84109,84121,84124 all have great possibilites and a range of price. The following is reproduced from MSNBC.

updated 3:24 p.m. MT, Wed., June. 18, 2008

In his hunt for a new home, Demetrius Stroud crunched the numbers to find out that, with gas prices climbing, moving near an Amtrak station is the best thing for his wallet.

Stroud was looking in Elk Grove., Calif. — about 85 miles away from his job in the San Francisco Bay Area — because homes there are more affordable. But with gas at $4.50 and a car that gets about 22 miles per gallon, Stroud would be pumping $560 a month into his tank.

So instead he made an offer on a home near the train station in Davis, which will shave $160 off his commuting costs.

"I wouldn't even be able to consider doing it without that Amtrak possibility," said Stroud, 45, who also telecommutes one day a week to his job in software quality assurance.

Stroud's choice represents a fundamental shift in the way more Americans are approaching home buying in this era of ballooning gas prices. Real estate agents, transportation officials and industry surveys indicate that home buyers are placing more importance on cutting their gas bills and commute times than they have since the oil shocks of the 1970s.

And there are some early indications that homes near urban centers, and subway, train and bus stops are often selling faster and at better prices than those in the distant suburbs.

On Wednesday, a survey of 900 Coldwell Banker agents showed a remarkable 96 percent said that rising gas prices were a concern to their clients, and 78 percent said higher fuel costs are increasing their desire for city living.

Don Denton, manager of Coldwell Banker Residential Brokerage in the Capitol Hill area of Washington, D.C., said prices are holding in the area and the neighborhood appears to be expanding.

"We have seen a steady increase in interest in our area over the last several years and it is comparable to how the reaction to the 1970s gas crisis sparked an interest in this area and inside the entire Beltway," Denton said.

A grueling commute by car into the city is the main reason why Mark Bulkeley wants to move closer to his job in Tysons Corner, Va., near downtown Washington D.C. He is selling his home in Haymarket, Va., which is 30 miles from work, and has signed a contract on a home in Great Falls, Va., that's just 6 miles from the office.

"My commute is miserable enough that I've taken to leaving my house at about quarter to five in the morning to avoid the traffic," said Bulkeley, a 36-year-old wholesale electricity trader. "It's kind of brutal. It's routinely an hour, and there's a lot of variability around that."

Bulkeley already has a hybrid Honda Civic, but he still calculates a savings of about $100 a month on gas once he moves closer to the city.

"When we decided that we were going to make a move we basically put a dot in the middle of the map where my office is and said, `We are not going to live farther than essentially a 20-minute circle around that,'" Bulkeley said.

Best

Matt

Will Gas Prices Change Our Cities?

2008-06-18T09:13:00.000-07:00

Many experts claim rising gas prices are good for us, as they are forcing us to change our habits and develop new technologies. One such expert suggests the days of hour long commutes are over as people move back to city centers.
Would this be bad, can you imagine this happening in a country where a brand new home is the dream of many young men and women? I'm curious to hear what you think, is there a positive side to this fiasco?

Best,

Matt

Uhhhh, Looks Like Another UT Legislator Is Trapped....

2008-06-17T17:04:00.000-07:00

In Depth: Year Over Year Statistics in Zip 84102

2008-06-17T11:15:00.001-07:00

The best way to understand the future is with a sound understanding of the past. Zip Code 84102 covers the eastern part of downtown Salt Lake City, east to the University of Utah. This area is seeing MASSIVE declines in sales activity, and will likely be a place to find good value in the year ahead.

The following are year over year comparisons for 2006, 2007 and 2008 in 84102 covering January-June 15 in each year respectively. In 2006, 35% of all listed homes sold in 39 days for an average price of $261,000. In 2007 during the same period, 31% of listings sold in 39 days for an average price of $304,000. In 2008, 10% of all listings sold, IN 54 DAYS, for an average of $278,000. That's more than a 200% drop in percent of listings sold in 2008 while the total number of listed homes increased 22% from 2006, and 15% from 2007.

With figures like these, now may be a good time if you like this area of town.

Housing Rescue Group Steps up Efforts

2008-06-17T10:54:00.000-07:00

If the government won't act, maybe private industry can help people save their homes. CNN Money takes a look at helping troubled borrowers...

Hope Now, the alliance of lenders, mortgage servicers, investors and community advocacy groups put together to fight the foreclosure epidemic, announced new guidelines Tuesday that should help speed up the process of helping borrowers who are trying to hang onto their homes.

"It may not be a panacea, but it will help a lot of people and lay a strong foundation for recovery," said Jonathan Kempner, president and CEO of the Mortgage Bankers Association.

Reaction from advocacy groups that offer foreclosure prevention counseling was subdued. The policies should have been introduced six months ago, according to Austin King, the director of the Financial Justice Center for the Association of Community Organizations for Reform Now (Acorn). And, he said, much of it doesn't go far enough.

"These changes, though admirable, still do not represent the major progress that will lead us out of the foreclosure crisis," said Maud Hurd, Acorn's president, in a press statement.

The guidelines, slated to take effect within 60 days, are designed to make the process of getting a loan workout faster, more uniform and more transparent.

Keep in touch. Hope Now members pledge to keep borrowers more informed about the status of their workout request than they have in the past, acknowledging workout requests within five business days, and issuing an approval or denial within 45 days.

Secondary loan-holders agree to step aside. Lenders have also agreed to do much more than they have in the past to keep homes out of foreclosure. The new guidelines stipulate that under certain circumstances lenders should give up any claims to a second lien - which is generally a home equity loan or line of credit - if that's what it takes to do a workout.

These secondary loans have been roadblocks for many troubled borrowers, because many of the secondary lenders refuse to approve loan workouts. They generally have little to gain by signing off on any changes.

"That we were able to get them to agree was a major concession on the part of these lenders," said Kempner.

"Hope Now seems to be taking one broad step forward with the automatic subordination of the second-liens," said King. "Many of the loan workouts we have been trying to do were derailed by second-lien holders who wouldn't subordinate."

Consider options such as short sales. The guidelines also call for servicers to delay foreclosure proceedings whenever there are other options possible. They specifically suggest that lenders give more consideration to other foreclosure prevention measures, including requests for a short sale.

In these transactions, borrowers find buyers willing to buy their homes at market value, which is generally less than the amount of the mortgage. Lenders have to approve these sales and agree to forgive any outstanding debt that isn't covered by the sale price.

Many mortgage servicers and lenders have been slow to approve short sales or refused such offers altogether. That often meant borrowers went into foreclosure. The new guidelines say members may suspend foreclosure actions to give borrowers time to complete approved short sales.

"That is a good thing," said Duane LeGate, president of House Buyers Network, which specializes in arranging short sales. "I can't tell you how many homes have had contracts for short sales, only to be lost to the foreclosure process."

The group also cites the option of a deed in lieu of foreclosure for lenders, which is when a homeowner gives the deed back to the bank without going through the foreclosure process. The bank then forgives the difference between what's owed on the mortgage and the home's market value.

These new policies may facilitate short sales and deeds-in-lieu of foreclosure, but they do little to help individual homeowners who still need a place to live, according to Mark Seifert, director of the East Side Organizing Project in Cleveland. He offers foreclosure prevention counseling to some of the hardest hit communities in the nation.

"Hope Now calls short sales and deeds-in-lieu workouts," he said. "How are they workouts? The people are still out of the house."

More accountability. The new Hope Now guidelines also call for new reporting standards that should help the industry better track its progress in a more comprehensive, uniform way.

Hope Now has been criticized that its claims of having helped more than 1.6 million borrowers are not backed up by enough concrete, detailed data, breaking down things such as the specific types of mortgage modifications completed.

All of this is progress, but community advocates like Acorn's King would like to see Hope Now shift its emphasis from repayment plans, which give borrowers a chance to catch up, to mortgage modifications, which lower payments by reducing a loan's interest, principal or both.

"Repayment plans are a recipe for failure," he said. "In cases where there is a structural lack of affordability, you don't solve it with a repayment plan."

In April, nearly 60% of the workouts that Hope Now members offered at-risk borrowers were repayment plans.

Hope Now also stressed that outreach is a critical part of the foreclosure prevention process. It's members pledged to send letters to all borrowers 60 days or more late with payments to inform them of their options. The letter would contain contact information for loan counselors as well as the loss mitigation department of the mortgage servicer.

Members also agreed to send out letters to borrowers with subprime adjustable rate mortgages (ARMs) 120 days before their loans are scheduled to reset to higher interest rates, informing them of potential payment increases and offering help should they need it.

Meanwhile, foreclosures have outrun Hope Now efforts to slow them. In April more than 73,000 people lost their homes to foreclosure, according to RealtyTrac, a online marketer of foreclosure properties. That was up 158% from May 2007.

Top 10 Tips For Photographing a Home For Sale:

2008-06-17T10:38:00.000-07:00

Which home would you rather live in? Ok, it's a trick question, they are the same home. If you were surfing the web for a new home, would you be drawn to one photo and not the other? Which one? (Please drop me a line and tell me why....) Two Salt Lake City agents have listed this home in the Capitol Hill area, one used the "bad" photo, the other the "good." I'm regularly suprised by how many so called professionals hurt their clients by not creating the right "picture" for the homebuyer. Make no mistake about how these "fluff" areas make a HUGE difference, especially in slow times like this. It's a shame to leave money on the table because of poor photos, bad staging, curb appeal etc...

The Los Angeles Times had a great post on photographing homes for the web. I have culled some of the best advice and added some of my own to create this list:

Use a tripod. It provides steadiness and allows you to operate your digital camera’s controls — specifically, shooting interiors at a slower speed.

Strive for even lighting. Professionals use strobe lights to brighten the dark spots. One of the mistakes that amateur photographers make is to shut all the blinds and turn on every artificial light in the room. This creates “halos” around each lamp. Don’t shoot when sunlight is streaming in from the windows. And use the flash on the camera to even things out.

Remove all clutter. Also remove all personal photos. The goal is to have potential buyers envision themselves living in your house; your family’s photos interfere with that process.

Wet down the brick patio and concrete pool surround to avoid it being too bright in the photo. Wetting it down also brings out the rich color in the brick.

Don’t be afraid of the shade. Gardens look richer when they aren’t shot in the blazing sun.

Leave no detail unattended. Tape the folds of the dining room tablecloth so it doesn’t pucker out. Position chairs uniformly (about 1 foot) from the table’s edge.
Shooting a pool presents special challenges because of the reflective nature of the water. Use a flash and try your shot in late afternoon or early morning.

Change the Perspective for exterior shots. If you shoot the home from the traditional front on shot, it is generic. Be creative and make the pictures memorable.

Consider using a software program such as Photoshop to touch things up. It is a way to eliminate telephone and electric wires. Ditto for punching up colors and obscuring some less desirable elements.

Tell a story. Your photo’s still may not win awards but the key thing is to create an impression that this house will be someones home. Remember the end in mind, the goal of every picture is to sell the home. Even if you use an outside photographer, tell them the idea’s you want to get across and the target market.
Best,

Matt

Mozillo’s Countrywide Financial Envelopes Senators In Loan Scandle

2008-06-16T10:44:00.000-07:00

I don’t know nothing....That is the reaction of Senators Kent Conrad, known as the Statistician, and Christopher Dodd, Presidential candidate, after being named as beneficiaries of below market loans by Countrywide Financial.

The loans were part of the “Friends of Angelo” program named after CEO Angelo Mozillo.

Of course both Senators deny knowing that they were given special treatment. And if you have seen how these two have spent our tax money you know attention to details as trivial as the interest rates on their mortgages was minimal.

Yeah, right, as the kids say.

That these two happened to apply for a loan and the application of the loan was know to the CEO Mozillo stretches the imagination of coincidence. Instead, the priming of the pump for politicians continues on.

And how many times have these two voted on legislation that helped Mozillo? I do not know but their ethics sure have been brought into question.

Such loans to members of Congress or executive branch officials — if given on favorable terms — could run afoul of federal ethics laws that limit the amount public officials can receive as a gift, according to campaign ethics watchdogs. But if the senators were unaware that they were receiving favorable treatment and if there was no quid pro quo, it would be harder to make a case. Still, Citizens for Responsibility and Ethics in Washington, a nonprofit watchdog group, has called for Congressional ethics committees to investigate.

“There are legitimate questions that need to be answered,” said Melanie Sloan, executive director of the group. “It sounds like these senators didn’t inquire too closely about what they were getting.” via NYTimes.com

Top 10 Worst Foreclosure States For May, 2008

2008-06-16T10:42:00.000-07:00

The big 4 lead the way again. Nevada, California, Arizona, and Florida both have foreclosure rates above the rest of the country for May, 2008.

The rates are significantly worse than April with Nevada being up 23 percent. Colorado foreclosures were down 10 percent signaling a slowdown but for the most part the states saw rapid increases in the rate of foreclosure activity.

Top 10 Worst Foreclosure States For May, 2008

Rank State Per 1000 April Change1 Nevada 118 23.82
2 California 183 11.2
3 Arizona 201 11.52
4 Florida 228 5.96
5 Michigan 353 24.57
6 Georgia 378 11.45
7 Colorado 388 -10.05
8 Mass. 406 32.83*
9 Ohio 410 5.27
10 New Jersey 467 44.47*

Short Sale Scams

2008-06-15T15:57:00.000-07:00

That low short sale price catch your eye? Wait, if you're in Salt Lake City its possibly a mirage, a hoax, a FAKE! Unfortunately for buyers, some realtors have taken to trickery to market these properties. Let's consider how it works.

With an increase in foreclosures, home owners in trouble are seeking short sale agreements with their banks. Short Sales happen when banks agree to accept less than the amount owed by the borrower as satisfaction for the debt. No, banks are not that generous, but they know getting some money is better for the bottom line than foreclosing.

It's a good system that can provide relief to homeowners, banks and lucky buyers who can find deals. But its not nearly that simple, especially here in Utah. Like many things in the Beehive State where business is king and fraud is common, short sales are often used by unscrupulous realtors for profit.

Realtors often list homes for short sale at prices they know or should know are unreasonable and the bank will never accept. Consumers need to realize that when listings say short sale, the price they see is likely worthless, a scam to recieve numerous offers and create a bidding war. They should remember that only the bank can set the price, and usually at the listing stage they are not involved in any way. Let's look at the typical situation.

Homeowner is near foreclosure, realtor suggests requesting the bank to approve a short sale. Realtor lists home, once an offer comes in that homeowner likes, the home is listed as a short sale while the bank decides on the offer. It's important to remember this process often takes months. Meanwhile, until the bank decides on the offer they will accept, the home stays on the market recieving bids. It's a fallacy, buyer and seller come to terms on a price they have NO ability to control. Only the bank can decide. It would be like me accepting half the market value for your car. I'd get lots of takers, but would the sale be valid without your approval?

Classic Bait and Switch

It all looks a lot like ILLEGAL bait and switch used by retailers. For example, say an eyeglass store runs a sale advertising $99 designer Ralph Lauren frames. The retailer has no intention to sell the frames at this price to however many customers will pay, they may sell one pair as a pretext, but their real intention is to use a bogus offer to attract as many customers as possible into responding to the ad. Retailers know once consumers have their appetites wetted by the prospect of a deal, they are far more likely to buy merchandise at full price.

Let's consider a real estate example I have watched unfold in one of the more prestigious Sugarhouse neighborhoods of Salt Lake City. Listing agent lists a home in March as "active-short sale" for $254,000, well below the comparable sales price for the neighborhood of $360,000-$380,000. After researching the county records and finding several trust deeds totalling more than $400,000, there were obvious red flags. I called the agent who explained he had NO OFFERS on the property and the $254,000 list price was a starting point (in clear violation of MLS listing rules). Today, that same home is STILL listed as an active short sale, but for $290,500.

Imagine, in this market raising the price on a listing thats been around almost three months. Either this agent was woefully negligent, or diliberately acting on the edge of ethics. Either way, these tactics are PERVASIVE in our market and decieveing customers at a time we need their trust.

I'm not trashing short sales as such, indeed I would buy a home personally through a short sale. In fact, there are good short sale deals out there. I am trashing my fellow realtors who ignore ethics for dollars. Here are some classic giveaways to these shady practices,

-home listed for sale waaaayyy below comparables
-agent tells you they have not started the short sale process(even though its listed as short sale)
-agent admits they have no indication of what bank will accept to retire debt
-home is listed as short sale by one of a handful of shady realtors (ask a realtor)

The rule, if it seems to good to be true it is, is probably the best advice I can give. As an experienced investor and realtor, I've gotten adept at spotting these offers at the outset. I believe my fellow realtors and I have a DUTY to police ourselves, AND our peers who are ethically challenged. We know who the bad apples are who actively bend the rules and ignore ethics. When we as realtors spot these lemons, we should challenge our fellow agents to defend their methods. If your a consumer who's been hoodwinked or a realtor who disagrees with my take, please contact me for a chat!And here is the rest of it.

Save Screech’s House? You have to be kidding…

2008-06-15T09:37:00.000-07:00

This has to be one of the greatest hoaxes or one amazing story. Dustin Diamond, Screech from the show Saved By The Bell, is about to lose his home to foreclosure in Wisconsin and is selling t-shirts to save his house. No, I am not kidding.

This just reeks of the absurd but at the same time it is very compelling. Essentially Dustin left LA for Wisconsin, bought an expensive home, and now because of credit and financial problems is about to lose his home in a foreclosure. The Screech has been served.

My question is what happened to the residuals from the show. It used to be on TV perpetually on TBS and other channels. He has to be banking some money on this.

During the past years the land around me has developed for the better and my property value went way up. Now that the house is worth a lot more they want it back. Knowing my credit is bad, getting a straight mortgage would take some time. I received a letter stating that I had 30 days to pay $250,000.00 or get out. I was not thrilled.

Calling an old friend with lots of connections, I was finally referred to a man named Arthur Giraldo who works for New York Capital Exchange. “If he can’t do it, it can’t be done.” Arthur was said to be an expert in land contracts and a guru when it came to getting difficult loans done. Indeed Arthur sold himself highly and away we went to save my house. I was told not to worry, that it wouldn’t be a problem and that everything would be done quickly, as was needed. read the rest at Dustin Diamond House Foreclosure

What to do in Real Estate NOW....

2008-06-13T12:13:00.000-07:00

I'm strongly urging my clients to buy homes right now. I know, it sounds easy to say and I'm a realtor, so why wouldn't I give that advice? Let me be clear, I will NEVER advise my clients to do something I am not doing. So when I advise my clients to buy it means I'm buying too!

As an investor in real estate and stocks I feel STRONGLY about this advice. I'm often irritated by "investment professionals" telling us to put our money here or there, only to find they are doing the opposite, or nothing at all. For me, this is unethical and I won't do it.

This phenomenon is most common among stock analysts or "the smart money" who tell you to buy when they have nothing at stake, but it's also common among realtors. How many realtors have you heard SCREAMING "It's a buyers market?!" I've never done a survey, but I wonder how many of these realtors are putting their money where their mouth is TODAY? My suggestion, ask the realtor who wants you to buy so badly, when did you last buy?

I walk my talk.

I'm confidently and loudly advising my clients to buy because that is what I'm doing with my money. I'm finding value in bank owned properties right now, indeed we just closed on a cute little home in Sugarhouse with great potential! The property was purchased by investors in the Summer of 2006 for $275,000, then remodeled for a flip. Unfortunately, these folks were caught in the downturn and the bank foreclosed. We purchased the home for $238,700, and our appraisal came in at $285,000!

It's not a brag, I want my clients to know if its good enough for their hard earned dollars, its good enough for mine. And lets be honest, when my clients make money, it's the best advertising I can get!

Best,

Matt

Is this real?...Financial Distress of the Wealthy?

2008-06-13T11:48:00.000-07:00
Another reminder about excessive spending came out in the news today. Ed McMahon, former sidekick to Johnny Carson and presenter of giant sweepstakes checks is about to lose his home to foreclosure. I don't see this as any harbinger about real estate for most folks, its more a statement about human nature and the carelessness often accompanied by easy wealth. I think I'll count my blessings!

According to news reports, McMahon is behind on his mortgage in excess of $600,000.

ReconTrust, a unit of mortgage lender Countrywide Financial, on Feb. 28 filed a notice of default on a $4.8 million Countrywide loan backed by Mr. McMahon's home. The notice was filed with the Los Angeles County Recorder's Office but hasn't previously come to light. According to the filing, Mr. McMahon was then about $644,000 in arrears on the loan.

The home is currently listed for sale at $5.75 million. It's been on the market for two years. McMahon joins the list of celebrities who have lost their homes or come close to it like Whitney Houston, Jose Canseco and Michael Jackson.

In New York, the uber-rich are struggling to come to terms with just being rich. A tough spot to be in I'm sure. Mike Shedlock brought this recent article to our attention.

One of her clients recently confessed that his net worth had decreased to $8 million from more than $20 million, and he thinks that his wife will leave him. He has hidden their fall in fortune by taking on debt to pay for her extravagant clothes and vacations.

“I literally had to sit there and tell him that he had to tell his wife that she had to stop spending,” she said. “He was actually scared she would leave him because their financial situation changed so drastically.”

Other wealthy clients are cutting luxuries that they think their friends and relatives won’t notice, according to Mr. Del Gatto of Circa. At Circa’s midtown offices, he said, the seven consultation rooms have been busy with customers selling their precious gems. Some older couples, he said, are selling estate jewelry to help support their children who have lost Wall Street jobs. Bankers are paring down their collections of Patek Philippe watches. Wives from Greenwich and Scarsdale are selling 2-carat to 35-carat single-stone diamond rings. One recent client explained to Mr. Del Gatto that she was selling $2 million in diamonds she rarely wore, because her friends wouldn’t notice that they were gone.

This article also mentions a real estate developer who has slashed his private air budget. The executive must now suffer the indignities of a Lear jet instead of the Gulfstream he had last year. Pity me, I don't know the difference! More importantly, I don't care.

The point of both of these stories boils down to the same thing; it doesn't matter how much you make, it matters how much you spend. When things get tough financially, less spending is the cure. It applies on all levels of life, including government spending.

Mr. McMahon's case is of particular concern. Here he is, 85 years old and he still needs to work to keep up with his lifestyle.

Mr. McMahon broke his neck in a fall about 18 months ago and hasn't been able to work, Mr. Bragman said. That health problem, along with the weak housing market and economy, has forced Mr. McMahon into foreclosure proceedings, Mr. Bragman said.

McMahon should have had plenty of savings for his golden years and should have downsized his lifestyle to match his income once he retired. This is a lesson for all those nearing retirement, particularly the "baby boomers" who are famous for having little savings.

FHA Loans or Conventional Loans -- APR vs Mortgage Rate -- Knowing the differences....

2008-06-13T08:49:00.000-07:00
Shop mortgage rates... Shop APR (Annual Percentage Rate)..... Shop mortgage fees..... So which is it?

Shopping for a mortgage can be very confusing to say the least. I hear so many called experts tell the average consumer to shop APR. This is not the wisest of decisions and can be argued by many professionals.

Lets add some more confusion. Most of us know what the rate is in regards to mortgages. Lets define rate and APR. Rate : A charge or payment calculated in relation to a particular sum or quantity: interest rates. (from answer.com) APR (Annual Percentage Rate) : Is the cost of your credit expressed as an annual rate. This is a federally required formula, designed to help the borrower compare the cost of credit. The APR rate is different from the note rate of your mortgage and is usually higher than the note rate. Why is this?

The APR rate is usually different than the mortgage rate because the APR includes certain fees which are calculated into the actual rate. The problem with this is that so many people tell you to use the APR as your measuring tool when shopping with other lenders. And each lender by law is suppose to send you a Truth in Lending disclosure which shows you the APR. Ill be breaking down what a Truth in Lending disclosure is in another post.

So why does comparing one companies APR with another can be misleading or incorrect? Because the lender is suppose to include certain fees in this calculation. Not only do some companies leave some of these fees out, but there are other fees that dont have to be included that some lenders might include and the rules are not clearly defined. Sound confusing? Yes and I will talk about this later.

So, what fees are included in the APR?

These fees are generally included :

-- Points -- both origination and discount

-- Underwriting, loan processing, and document prep fees (these are generally true junk fees)

-- commitment fee

-- attorney or title closing fees

-- PMI (private mortgage insurance) or MIP for FHA (Mortgage insurance premium) financed

-- Prepaid interest - Interest that is paid from the time that you close to the end of the month. The problem here is that some lenders put 1 day or 5 days down on your good faith estimate. Even if they dont know your closing date.

Sometimes included :

-- Application fee

-- Tax related service fee

Generally not included :

-- Appraisal fee

-- Credit report fee

-- Title fee

-- Recording fees

Conclusion : The overall function of the APR is to measure the 'true cost' of the loan. Its suppose to create fairness and a level playing field amongst other lenders. Getting back to why I think comparing APRs from different companies is a bad idea. As mentioned, some lenders dont know how to compute the APR. Others leave out certain fees that should be included. Lastly, many lenders use programs that help compute the APR and it doesnt matter if you are applying for a FHA loan or a conventional loan. Not all of these APR programs are the same. Blame this on the government for not making it all the same.

My mortgage lender tells me to use the TIL (Truth in Lending disclosure) as a helpful tool to ask questions why it might be higher or lower than another companies disclosure. But go back to the good faith estimate as your real tool. Why? Because all fees are supposed to be shown on this form. I would compare rate, term, and fees and here is a good example of this. Shopping Good Faith Estimates. (FYI - compare the same programs) Just one word of advice, not every loan officer will be truthful when it comes to the good faith estimate. Some lenders will not show all costs or confuse you by mixing up the different costs. *** And remember this, most of the costs are 3rd party charges which are estimates. You need to decipher what these are in order to shop accurately. Finding a trusted mortgage consultant is very important.

Should we bail folks out?

2008-06-12T15:50:00.000-07:00
From a series in CNN Money, what do you think about the problems these folks are in?
Consider the story of Patricia Guerrero who had to go to the food bank on Good Friday to get food for her family. Her husband left her and she lost her job as a mortgage loan processor. Now we don't know the full story, but one fact immediately leaped out at me - she was on the brink of financial disaster after only two months. One of those months was covered by their tax refund, the other's obligations were met from savings. Guerrero has a $2500 a month mortgage payment and admitted she had to take off her Tiffany bracelet and leave her Coach purse in the car when she entered the food bank. This doesn't help her pity case one bit and commenters lambasted her.

However, it is clear by this story that she, like many other Americans, lives way beyond her means. She had no business getting a $2,500 a month mortgage on a $70,000 salary. Also, why didn't she have more money in savings? Sounds to me like she set herself up for failure. Maybe her story is the wake-up call more Americans need.

I am a single Mom with 2 kids and am scraping by making half of what she does. I don't feel sorry for her that she lives above her means and she better deal with the reality that's smacking her upside her head by moving and living realistically.

This woman should take her kids and move to another part of the US where houses are affordable. I feel nothing from this story; only bitterness at people that make bad decisions.

Longtime readers know I don't trust the media and there are a lot of omissions to this story we don't know. However, one thing you can see all over the Internet is people criticizing, condemning and complaining about failed flippers, overextended homeowners and other financial casualties.

Two themes that are very clear about this downturn is the sense of schadenfreude and the belief there should be no bailouts. As it's an election year, political candidates are being grilled over solutions to the housing problem. At HousingPanic the opinion on who has the best plan flip flops depending on the day. First it was John McCain who was right, then it was Barack Obama. The underlying theme of "correctness" is based on the assumption of personal responsibility and no bailouts. Hillary Clinton is vilified because her plan costs the most - $30 billion. In a presidential race that has been reduced to labels; black, female, war hero, I think we should vote in the smartest candidate and forget about the tags associated with each contestant.

At the root of the issue of bailouts and schadenfreude is our human sense of fairness. I've suggested in the past the housing crisis is like a fire negligently set in an apartment building. Regardless of who set the fire, or how they did it, everyone will suffer if it doesn't get put out.

But this sense of fairness, of justice runs much deeper. I've been thinking about it for some time and realized where I've heard this story before. Forgive me as I'm about to get Biblical.

11And He said, "A man had two sons.
12"The younger of them said to his father, 'Father, give me (A)the share of the estate that falls to me ' So he divided his (B)wealth between them.

13"And not many days later, the younger son gathered everything together and went on a journey into a distant country, and there he squandered his estate with loose living.

21st Century version of loose living - Hummers, granite counter tops, interest only loans and Coach purses.

14"Now when he had spent everything, a severe famine occurred in that country, and he began to be impoverished.

15"So he went and hired himself out to one of the citizens of that country, and he sent him into his fields to feed swine.
16"And he would have gladly filled his stomach with the pods that the swine were eating, and no one was giving anything to him.

Given the Jewish culture and the commandments about unclean animals, this was quite the step down.

17"But when he came to his senses, he said, 'How many of my father's hired men have more than enough bread, but I am dying here with hunger!
18'I will get up and go to my father, and will say to him, "Father, I have sinned against heaven, and in your sight;

19I am no longer worthy to be called your son; make me as one of your hired men."'

It's better to be the servant of a rich man than continue on the brink of starvation.

Rather than hold his son to judgment, the father celebrated his return and utterly forgave him for his mistakes -

21"And the son said to him, 'Father, I have sinned against heaven and in your sight; I am no longer worthy to be called your son.'
22"But the father said to his slaves, 'Quickly bring out (D)the best robe and put it on him, and (E)put a ring on his hand and sandals on his feet;

23and bring the fattened calf, kill it, and let us eat and celebrate;

24for this son of mine was (F)dead and has come to life again; he was lost and has been found.' And they began to celebrate.

In a turn of resentment, the older, responsible brother was robbed of his schadenfreude and complained -

25"Now his older son was in the field, and when he came and approached the house, he heard music and dancing.
26"And he summoned one of the servants and began inquiring what these things could be.

27"And he said to him, 'Your brother has come, and your father has killed the fattened calf because he has received him back safe and sound.'

28"But he became angry and was not willing to go in; and his father came out and began pleading with him.

29"But he answered and said to his father, 'Look! For so many years I have been serving you and I have never neglected a command of yours; and yet you have never given me a young goat, so that I might celebrate with my friends;

30but when this son of yours came, who has devoured your (G)wealth with prostitutes, you killed the fattened calf for him.'

The father concluded the tale by saying -

31"And he said to him, 'Son, you have always been with me, and all that is mine is yours.
32'But we had to celebrate and rejoice, for this brother of yours was (H)dead and has begun to live, and was lost and has been found.'"

I know this parable was not originally about homeowners, but it so eloquently explains human nature and presents the concept and need for forgiveness.

We have to do something to prevent all these foreclosures. Cities like Cleveland and Detroit have been blighted because of them. Crime has risen and governments have cut back on services because of lower revenues. California is in a similar situation. By not helping now, we will all be hurting later. Who cares if an irresponsible person started the fire? The responsible people have to put it out. If we don't, nobody will and the original irresponsibility will eventually consume us all.And here is the rest of it.

Utah Real Estate - 1st Quarter Results--What I'm advising my clients NOW

2008-06-12T15:46:00.000-07:00
The numbers are in for Northern Utah and they are expectedly sluggish. Though prices have remained essentially flat, the number of transactions has decreased significantly. Much of that has to do with the tightening of mortgage loan standards.

In Salt Lake County home prices rose less than 1%, but sales activity dropped 42.2%. Davis County also saw flat prices while activity dropped 26.6%. Tooele County saw prices drop 6.3% with a sizable drop in activity. Utah County saw declines on both fronts.

The Salt Lake Realtor Board President said -

"People shouldn't be fearful. You have motivated sellers, and interest rates are low. It's a great time to buy."

I agree with these sentiments, with a few caveats. It's true, now is a great time to buy IF you have patience and the ability to wait a year or two. I'm recommending buying and holding for my clients, NOT flipping. None of us have clarity on when things will turn so its too uncertain to hope for the quick bucks flipping can sometimes provide, but if you can sock a few deals away for a couple years, I'm confident you'll do well. Indeed, it's what I'm doing with my money! (note, I NEVER recommend anything I'm not willing to do myself.)

First quarter in Utah is typically the worst, so I'm not trying to nail down a trend from these numbers, but there are a few standouts. 84102 suffered the biggest price drop at 30.6%, while 84123, Murray-Taylorsville, saw the biggest individual gain at 11.5%.

Clearly the credit crunch is affecting Utah home purchases. Affordable housing will always be competitive as 84104's gain of 11% can attest to. The bargains in the next couple years are going to be the luxury homes originally priced from $600k-$800k that will now be going for half that...particularly those on the edge of town in new developments.

Utilizing Seller Concessions in a Buyers Market.

2008-06-12T15:43:00.000-07:00
One of the most confusing part of the home buying process for new homeowners is the concept of seller paid closing costs or seller concessions. Seller paid closing costs allow for less out of pocket expense for the home buyer, but are rarely truly seller paid. Seller paid costs are actually buyer borrowed. Regardless, there is still a great benefit to having them.

Let's examine real quickly how they work. Assuming an asking price of $100,000 with the buyer using an FHA loan that has a maximum of 6% in seller paid closing costs, a buyer could offer $106,000 with $6,000 towards closing costs. The seller is going to net out at the same amount, so they usually don't care and it helps the buyer close easier. The buyer could also offer the asking $100k with $6,000 going towards closing costs netting the seller $94,000. Considering the way the real estate market is, that could easily be accepted or there may be further negotiation.

What can closing costs go towards? Title fees, property taxes, loan costs including lender fees, origination and rate buydown, homeowners insurance, up front mortgage insurance premiums and VA funding fees. They can't go towards a required down payment.

Unused closing costs go back to the seller. Sometimes on lower priced properties the lender maximums can't be used up. A savvy buyer should lower their offer by the unused amount. On purchases, overages of seller paid concessions can never be paid to the buyer as cash back.

Why not just pay the closing costs? Lenders want to know where the money is coming from and in today's marketplace those funds have to be sourced (where did the money come from) and seasoned (how long has the money been there). If you don't have the funds already in place, or need to use your savings for a down payment seller paid closing costs are a great way to get the loan approved.

Lenders limit the maximum amount concessions can be. For VA loans, the number is four percent...FHA mortgages are 6%. Conventional loans vary dependent upon the lender. Be sure to check with your lender when you tender the offer. Closing costs must be negotiated at the time of the offer, though it's possible to go back and amend the contract.

Seller concessions are not a right. Remember buying a home is a negotiation and you can succeed more often by presenting an offer that benefits both sides. Don't rake the seller over the coals on price and then add in seller paid concessions. You may get the offer accepted, but if problems develop down the road like you need to extend the closing, you may find the seller to be less than accommodating.

For potential homeowners who want to minimize their out of pocket expenses, negotiating seller paid closing costs is a great way to do it.

Labels: closing costs, fha loan, VA loans

And here is the rest of it.

Latest Foreclosure Numbers Show 97.5% of Homeowners Pay on Time...

2008-06-12T15:35:00.000-07:00
That could be an alternate title to the news story claiming Homes in foreclosure top 1 million, but it probably wouldn't gain that much attention. As they say in the media, "if it bleeds, it leads."

The news on Wall Street today was wildly positive. Stocks closed up sharply, unemployment was down for the week and even retail sales were up last month. The American consumer is alive and well.

I'm not trying to downplay the foreclosure situation, because the numbers are truly staggering. If we take into account the fraud and speculation over the past few years, many of the homes being "lost" were never occupied to begin with. Consider some of the fraud stories covered here: Casey Serin had 8 empty houses lost to foreclosure; Zareh Tahmassebian several dozen; Brad Kitchen also had dozens. Workouts for those loans were simply not possible.

Consumers are taking advantage of the deals in real estate owned (REO) properties. Sentiment has turned.

The revival will probably begin in the areas hit hardest by the bust: in Florida, Las Vegas, and the honeycombed tracts that flank the broad freeways east of Los Angeles known as the Inland Empire. (Indeed, home sales in Southern California surged 22% from March to April, hitting their highest levels since August.) Why will housing come back? For a reason as solid as floor joists: The entry-level buyer, for the first time in years, is finding that owning a new house is suddenly just as cheap as renting. "Those first-time buyers got locked out by high prices," says John Karevoll of DataQuick, a research firm that assembles data on the U.S. real estate market. "Now the buying activity that was on hold is starting to come back."

Now that I'm working with clients across the country, I'm witnessing this activity on a daily basis. I had one client in Las Vegas place 20 offers before one was accepted today. He was being out-bid on REO homes by $40-50 thousand. Agents and clients in California and Arizona are reporting similar situations. Activity doesn't guarantee appreciation...home prices could stabilize at current levels for some time. The important point is sentiment has changed.

Mortgage rates are reacting to this change in sentiment having gone up .75% in about the last three weeks. The last two days have been particularly volatile. I suspect rates will continue to trend up as the economy continues to show signs of improvement.

It makes sense that mortgages will cost more, both in rate and costs. Lenders have already increased prices based on credit scores, loan to value and loan amount. Standard fees have increased as well. I liken the increased costs to retail shops that have to increase prices because of shoplifting. Though we have a special name for mortgage theft - fraud - the bottom line is it's still theft. Those mortgage losses, reflected in that 2.5% foreclosure rate, are being passed on to new borrowers. Further, the bankrupt and closed lenders actually decrease the amount of competition in the marketplace, making the survivors of this crisis the "only game in town."

As heartbreaking as a foreclosure is to a homeowner that actually occupied the property, the current environment is clearing through a lot of fraud and is presenting buying opportunities to prospective homeowners previously priced out. We're returning to "normal"...whatever "normal" is.And here is the rest of it.

Risks-For Sale By Owner

2008-05-26T20:12:00.000-07:00
About 20 percent of homes sold in this country are sold without a real estate agent. Surveys show that the most common reason for buying or selling a home without an agent is to save money.

Real estate commissions are negotiable, but they usually range from 5 to 7 percent of the sale price for residential property. So, if you sell your home for $300,000 and pay a 6 percent commission, this will reduce your net proceeds from the sale by $18,000. On the other hand, if you list your home for sale with an agent and get broad market exposure, it might sell for a high enough price to offset the cost of the commission.

But, let's say that money is not the issue. Perhaps your Aunt Tillie passed away and you have the opportunity to buy her home before it's listed for sale. What should you be aware of before going ahead?

One of the reasons home buyers and sellers use an agent's services is to make sure that all compliance and disclosure issues are dealt with properly. If you don't have first hand experience with the ongoing changes in the residential real estate industry, you'll need to do some research or hire a real estate attorney to make sure that nothing is overlooked. Otherwise, you could face legal problems in the future.

Another issue for buyers and sellers who are dealing directly is how to establish the price. Buyers don't want to pay more than fair market value and sellers want the highest price possible. One solution is to hire a licensed appraiser to appraise the property based on recent comparable sales in the area. Be sure to use an experienced appraiser who knows the local area well. An out-of-area appraiser might not be familiar with the subtleties of local market pricing.

An appraisal, even if completed by the best local appraiser, may not be an accurate reflection of current market value. Appraisals are somewhat subjective and the real estate market is constantly changing. In a rapidly changing market, yesterday's comparable sales may already be out of date.

A benefit of listing a property for sale and exposing it to as many prospective buyers as possible is that it resolves the pricing issue. If the list price is lower than what the market will bear, the price is bid up by competing buyers. A home that's listed too high for the market will usually sit on the market unsold until the price is reduced to market level.

A risk you run buying or selling directly is that you pay too much or sell for too little. Although, under some circumstances, it may be worth the risk. One buyer who bought directly from a friend paid about $15,000 over the market price. But she's still living in the house 17 years later and loving it.

First Time Tip: Perhaps the biggest pitfall of representing yourself is that it's difficult to maintain the objectivity that's required to negotiate and execute the best deal for yourself. Unlike other business transactions, buying and selling homes tends to be emotional.

If you do decide to buy or sell directly, consider hiring a knowledgeable real estate attorney or real estate agent to oversee the transaction and to make sure that all the details are completed properly. Many agents will handle such a transaction for about half of what the normal commission would be.

The Closing: Don't underestimate the time that's required to successfully negotiate and close a home sale. If you're short of time, get help from a professional.

And here is the rest of it.

Eight Pitfalls to Avoid When Selling Your Home

2008-05-26T20:08:00.000-07:00
Selling your home is one of the biggest financial transactions you will make. I will work diligently for you to make the sale of your home as successful as possible - and will help guide you away from any number of pitfalls along the way.

Pitfall #1
Pricing Incorrectly: Every homeowner wants to realize as much money as possible when selling. However, a listing price that is too high gets fewer showings and often gets the seller less than a price that is at market value. Determine listing price by using the fair market value of your home based on the current local real estate market. Homes that are priced correctly sell in a shorter time for a higher price than homes that are priced too high, languish on the market, and get "stale."

Pitfall #2
Failing to "Show-Case" Your Home: Most buyers select their home based on emotion and then justify the decision with facts, so it is very important to make your home inviting. Yours is not the only property the prospective buyer will see. You have competition and only one chance to make a good first impression. It is well worth the time, effort, and money to prepare your house properly for marketing.

Pitfall #3
Using the Hard Sell During Showings: People like to "try on" a house and see if it is comfortable for them. It is difficult for them to do that if you follow them around pointing out every feature and improvement. It often has the opposite effect you want. It is best to leave your home during showings and not return until everyone has left.

Pitfall #4
Mistaking Lookers for Buyers: For Sale By Owners have their property invaded by unqualified buyers. REALTORS®, however, bring qualified buyers, which means quality traffic. Most people looking at For Sale By Owners are usually months away from being ready to purchase. They do not want to bother an agent yet, so they call owners to get a feel for what is available. Then there is that group of people who are perpetual lookers...

Pitfall #5
Not Knowing Your Rights & Obligations: Real estate law is extensive and complex. The real estate sale contract is a legally binding contract. An improperly written contract can cause the sale to fall through or cost you thousands for repairs, inspections, and remedies.

Pitfall #6
Limiting the Marketing & Exposure of Your Property: The two most obvious marketing tools, open houses and classified ads, are not the most effective ways to sell your home. Less than 1% of homes are sold from an open house and less than 3% are sold from an ad. More than 60% of buyers are already working with agents when they start thinking about buying a home. Effective marketing activities need to be customized to your home.

Pitfall #7
Believing That Your Recent Appraisal is the Market Value of Your Home: Refinance appraisals do not necessarily reflect the market value of your home. Market value is what a ready, willing, and able buyer will pay for your home. This buyer will look at all available information, including foreclosures and distress sales. Refinance appraisers may ignore or discount foreclosure and distress sale information. A buyer, however, will not ignore or discount any information.

Pitfall #8
Choosing a REALTOR® for the Wrong Reasons: The sale of your home could well be the largest and most important financial transaction you have ever made. The quality of your home selling experience is dependent on your skill at selecting the agent best qualified. Working with an experienced, competent professional in your transaction can mean a higher case net at the negotiating table, selling in less time, and getting problems solved rather than escalated. Make your agent selection carefully. Do not let an agent "buy" your listing by agreeing to list it too high: Look at the comparables, analyze the data, consider the quality and expertise of the agent, and make a business decision. And here is the rest of it.

Investing-Avoiding the Pitfalls

2008-05-26T15:55:00.001-07:00

Investing in real estate is like riding down a class five river rapid. If you have an experienced and certified specialist you'll be safe and have fun. If not, your day will quickly turn into a nightmare. Conventional realtors may be familiar with boats, oars and life jackets, maybe they own a fishing boat, but that does not mean they have experience on river rapids. Would you trust a weekend fisherman to take you down the big waters?

Finding investment properties is both challenging and time consuming because the competition, fellow investors, are smart and savvy. Indeed, those who succeed in this specialized area over time do so because of their knowledge, skill, and avoidance of the numerouse pitfalls which can cause disaster. While any realtor can help you find investment property, you'll likely leave money and part of your profit margine on the table if you don't select someone who specializes in purchasing investments.

As a fellow investor, I'm often asked how I find the "deals" or the good values I do. Were I to say "hard work," you might scoff. Indeed, I'm often asked "who I know" or "who's my contact" because many believe that is the only way to find deals. My experience teachs me that while contacts may help, those who succeed do so through the proper training, systems, organization and HARD WORK.

Indeed, investing, finding value, however you want to say it, is my favorite part of the real estate business. Going through foreclosure lists, investigating the county record for tax liens and debt amounts, attending auctions, searching the MLS, working short sales, or REO's (bank owned properties), may sound dreary or torturous to you, but its what I love and where I add value for my clients.

To help you understand my philosophy and motivation, lets consider what famed investor Warren Buffet, the "Oracle of Omaha" says about finding a good investment "Be greedy when others are fearful, fearful when others are greedy." Translation, when something is all the rage, stocks, homes whatever, its probably wise to pull back, take profits, be cautious. When things look desperate, when the "crowd" looks to be throwing in the towel, that's the time to bargain shop. The problem is, its EASY to follow the herd, its much harder to act when everyone else is doing the opposite. Here's where study, training, and apptitude make the difference.

If your considering investing in real estate, the first thing you should do is interview several agents. Have they invested for themselves or a client recently? Are they versed in foreclosures, investigating the county record, do they know the tricks and PITFALLS of short sales? Ask them to do a CAP rate equation on a rental property and what price this might justify paying. If your agent doesn't know these terms, cannnot explain them so you can understand, be cautious. They consider themselves certified river rafting guides, when in reality they're nothing more than weekend warriors.

Is Salt Lake Recession Proof?

2008-05-26T15:51:00.000-07:00
Nationally, home prices are falling, unemployment is on the rise and the economy is expected to grow slowly--or even contract--in the first half of the year. Nationally, home prices are falling, unemployment is on the rise and the economy is expected to grow slowly--or even contract--in the first half of the year.

But some cities are doing just fine.

Take Oklahoma City, Okla. With falling unemployment, one of the country's strongest housing markets, and solid growth in agriculture, energy and manufacturing, it looks best positioned among the nation's largest metropolitan areas to ride out the current crisis.

San Antonio is right behind. It also features solid employment figures and affordable home prices that continue to rise. Its industries are growing; it can't hurt that the new AT&T was formed when San Antonio-based SBC Communications swallowed the old AT&T Corp. and BellSouth.

The others holding steady or improving include Austin, Texas; Houston; Charlotte, N.C.; Dallas; San Jose, Calif.; Raleigh, N.C.; Salt Lake City; and Seattle.

Behind the Numbers

To find them, Forbes.com examined the country's 50 largest metros and looked at several key measures.

We examined unemployment data supplied by the U.S. Bureau of Labor Statistics for the year ending in February 2008 to see which areas are most adding or subtracting jobs. Next, we looked at the BLS data on job growth in non-farm payrolls, through February 2008, for construction, education and health services, financial activities, information, leisure and hospitality, manufacturing, natural resources and mining, professional and business services, trade, transportation and utilities, and the BLS's catch-all category, "other services."

We also took into account median home price data from the National Association of Realtors--from the fourth quarter of 2006 to the fourth quarter of 2007--to see which areas posted the largest annual gains. Our data don't account for the impact of declining sales in the first several months of this year.

Finally, our rankings were adjusted using data from a November 2007 report, "U.S. Metro Economies: The Mortgage Crisis," by the U.S. Conference of Mayors. It lists each city's estimated gross metropolitan product growth by projecting how rising foreclosures and falling home prices would affect overall levels of productivity in local economies.

Sunny Southern Skies

Texas cities fared best under these measures. San Antonio, Austin, Houston and Dallas-Fort Worth have benefited from historically lower home prices, which have been affordable to a large segment of the population. The availability of land--and, in some cases, little zoning--helped keep prices in these cities low. Instead of competing for homes, Texans could move to a new subdivision a little farther out.

What's more, all four boast falling unemployment rates, with Austin dropping from 3.8% to 3.6% and San Antonio from 4.3% to 4%

Austin will likely fare well through tough times

Cities that are expected to see growth in non-farm payrolls include Raleigh, which is expected to see 7.4% growth in professional and business services and 6% growth in education and health. In Salt Lake City, where the median home price rose 2.5% and unemployment, at 3.1%, is below the 5.1% national average, growth in education and health services is expected to be 5.5%.

Some cities have seen increasing home prices but otherwise continue to struggle. Buffalo and Rochester, N.Y., have seen home price growth (from a low base) but still contend with high unemployment--around 6%--and slow-growing or shrinking industries.

And in the San Jose area, the median home sale price is over $830,000. That's 11% higher than it was in the fourth quarter of 2006, helping to land the area at No. 4 on our list. Problem is, that growth has since cooled, and it remains to be seen whether pricey homes coupled with a 5.3% unemployment rate will cause trouble for homeowners this year.

To be sure, even in the most resilient cities, the mortgage crisis has caused suffering. People everywhere got into bad mortgages. Similarly, even in the most battered cities, the majority of people are employed and making their mortgage payments. The extent of recession or resilience is very much in the eye of the beholder, and this list represents only one of many ways to take a snapshot of economies that are standing tall.

In his statements to Congress' Joint Economic Committee earlier this month, Federal Reserve Chairman Ben Bernanke predicted the economy would possibly move into recession in the first half of 2008 but begin to rebound in the second half.

If you're tired of waiting, these might be the best places to go.

Copyrighted, Forbes.com. All rights reserved. And here is the rest of it.

But some cities are doing just fine.

Take Oklahoma City, Okla. With falling unemployment, one of the country's strongest housing markets, and solid growth in agriculture, energy and manufacturing, it looks best positioned among the nation's largest metropolitan areas to ride out the current crisis.

San Antonio is right behind. It also features solid employment figures and affordable home prices that continue to rise. Its industries are growing; it can't hurt that the new AT&T was formed when San Antonio-based SBC Communications swallowed the old AT&T Corp. and BellSouth.

The others holding steady or improving include Austin, Texas; Houston; Charlotte, N.C.; Dallas; San Jose, Calif.; Raleigh, N.C.; Salt Lake City; and Seattle.

Behind the Numbers

To find them, Forbes.com examined the country's 50 largest metros and looked at several key measures.

We examined unemployment data supplied by the U.S. Bureau of Labor Statistics for the year ending in February 2008 to see which areas are most adding or subtracting jobs. Next, we looked at the BLS data on job growth in non-farm payrolls, through February 2008, for construction, education and health services, financial activities, information, leisure and hospitality, manufacturing, natural resources and mining, professional and business services, trade, transportation and utilities, and the BLS's catch-all category, "other services."

We also took into account median home price data from the National Association of Realtors--from the fourth quarter of 2006 to the fourth quarter of 2007--to see which areas posted the largest annual gains. Our data don't account for the impact of declining sales in the first several months of this year.

Finally, our rankings were adjusted using data from a November 2007 report, "U.S. Metro Economies: The Mortgage Crisis," by the U.S. Conference of Mayors. It lists each city's estimated gross metropolitan product growth by projecting how rising foreclosures and falling home prices would affect overall levels of productivity in local economies.

Sunny Southern Skies

Texas cities fared best under these measures. San Antonio, Austin, Houston and Dallas-Fort Worth have benefited from historically lower home prices, which have been affordable to a large segment of the population. The availability of land--and, in some cases, little zoning--helped keep prices in these cities low. Instead of competing for homes, Texans could move to a new subdivision a little farther out.

What's more, all four boast falling unemployment rates, with Austin dropping from 3.8% to 3.6% and San Antonio from 4.3% to 4%

Austin will likely fare well through tough times

Cities that are expected to see growth in non-farm payrolls include Raleigh, which is expected to see 7.4% growth in professional and business services and 6% growth in education and health. In Salt Lake City, where the median home price rose 2.5% and unemployment, at 3.1%, is below the 5.1% national average, growth in education and health services is expected to be 5.5%.

Some cities have seen increasing home prices but otherwise continue to struggle. Buffalo and Rochester, N.Y., have seen home price growth (from a low base) but still contend with high unemployment--around 6%--and slow-growing or shrinking industries.

And in the San Jose area, the median home sale price is over $830,000. That's 11% higher than it was in the fourth quarter of 2006, helping to land the area at No. 4 on our list. Problem is, that growth has since cooled, and it remains to be seen whether pricey homes coupled with a 5.3% unemployment rate will cause trouble for homeowners this year.

To be sure, even in the most resilient cities, the mortgage crisis has caused suffering. People everywhere got into bad mortgages. Similarly, even in the most battered cities, the majority of people are employed and making their mortgage payments. The extent of recession or resilience is very much in the eye of the beholder, and this list represents only one of many ways to take a snapshot of economies that are standing tall.

In his statements to Congress' Joint Economic Committee earlier this month, Federal Reserve Chairman Ben Bernanke predicted the economy would possibly move into recession in the first half of 2008 but begin to rebound in the second half.

If you're tired of waiting, these might be the best places to go.

Copyrighted, Forbes.com. All rights reserved. And here is the rest of it.

Why Sugarhouse?

2008-05-26T10:41:00.000-07:00
I named my blog after the place I'm proud to call home! I'm not alone, many love this area of Salt Lake City and would not live anywhere else. Perhaps it's the cultural diversity, vibrancy, and great neighborhoods? While Sugarhouse proper is a relatively small geographical area, its often used to describe a far larger area, and for the purposes of this article I'm including the neighborhoods of 9th & 9th, 15th & 15th, and the area around Emigration Market.

The main Sugarhouse business area on the corner of 2100 south and 1100 east is a warm inviting place with good food, drink, and culture. It's one of the few places in the Salt Lake Valley where you'll find uber cool 20 somethings and 50 somethings rubbing elbows in harmony. Or where you'll find a modern Barnes and Noble book store directly adjacent to a charming victorian style public library. It's a place where, even when retail chains like Starbucks move in, they enjoy healthy competition from the local champs like Sugarhouse Coffee.

9th & 9th has seen rapid changes in recent years. Yes, the Coffee Garden moved across the street, and yes, the ambiance isn't all it used to be, but its still bustling! New restaurants like Mazza give the area an upscale feel, while the brilliant Centered City Yoga and it's charming nationally known owner and teacher Dana Baptiste provide an anchor for fellow business's with a hyper-devoted clientele. Trust me, as a fellow devotee I know!

15th and 15th is the "I've arrived" area of town. Another small retail area centered around a street address, its' smaller and quieter than 9th & 9th but more upscale. Great dining and "boutique-ing" opportunities are available a minutes walk from the uncompromisingly fashionable homes in the area.

The famous Emigration Market with its "old school" neon sign graces the corner of 13th and 17th. The market is convenient for basic and upscale dinner menus, and shares the intersection with the ubiquitous Jolleys pharmacy and ever popular breakfast place Eggs in the City.

Harvard/Yale is an area to which many aspire and it's easy to see why. Roughly covering the aforementioned streets between 1300 and 1700 east, (as well as Gilmer Park and several other adjacent streets) its' winding boulevard feel, canopied streets and seven figure homes provide an oasis of beauty in our city.

This is the perfect area for those of us who want to be close to EVERYTHING while maintaining a quiet, friendly atmosphere to raise a family. Feel free to ask me about home values or restaurant menus, I'm proud of where I live and think you'll like it too!

New Home Windows Add Value and Decrease Energy Costs

2008-01-21T19:53:00.000-08:00
If high heating bills and mystery drafts are causing a chill in your love affair with your home, it may be time to consider replacing your windows.

The government system for rating energy efficiency of home products, ENERGY STAR, reports that average homeowners spend nearly 50 percent of their yearly energy costs to heat and cool their homes. Windows that are old, worn, faulty or have a low energy-rating do a poor job of keeping warm air inside in the winter and cool air inside in the summer.

Installing new windows can do wonders for your home on many levels, from improving energy efficiency and curb appeal, to boosting resale value. But window installation is a major project, and not within the abilities of your average do-it-yourselfer. When it comes to window replacement, it makes sense to have the work done by a professional.

If you're thinking about hiring a contractor to install your replacement windows, consider the following:

* Set a budget. Educate yourself thoroughly on what's available and comparison shop for the best price. This will help ensure your budget can cover the project cost.

* The style and materials you want. You have lots of choices when it comes to new windows, so make sure you have a good idea of what you want before you meet with a contractor. The more specific you are in communicating what you want to a contractor, the more accurate his estimate will be.

* Get at least three quotes. You want to make sure you are choosing the right person to do job for you, so meet with more than one contractor. Give each potential contractor the same specifications. This will help you compare the bids they submit.

* Compare quotes. Compare prices, quality of materials and timeline from each bidder. Don't hesitate to ask questions on anything that seems unclear. Make sure all your questions are answered from each contractor before you make a final decision.

* Get a contract. Decide on a contractor and get a written contract that describes everything in detail. Once it's down on paper and signed by both parties there's no disputing what the original agreement contained.

Where can you go for online contractor referrals? Log on to www.ReliableRemodeler.com and describe you home improvement project. Within 24 business hours, you'll be contacted to verify receipt of your project and to clarify any further details. Up to four pre-screened professional contractors will contact you within 48 hours to schedule a free estimate on your project.

Protect Your Home With New Siding

2008-01-21T19:49:00.000-08:00
(ARA) - In a lot of ways, the structural elements of a home can be compared to the human body. Framing is similar to our bones, waterproof barriers are like our skin, and siding is like the clothes we wear to cover our bodies. Siding can be compared to clothes because it protects the waterproof barrier (our skin) and serves as a decorative finish that enhances the home's overall aesthetics and, thus, its value. Clothes do the same for our bodies by protecting our skin and visually enhancing our appearance. Keep in mind; siding does not act as a waterproof barrier.

In the past there weren't many siding options to choose from, but today there are a wide variety of options available. The trick to choosing siding is to consider what would be attractive and compatible with the architecture of your home. You should also pay close attention to the quality of the material and how easily it can be maintained. Failure to maintain even the best, most architecturally pleasing siding can lead to sore looks and structural problems.

When is it time to install new siding? Unless you are building a new house, you will probably be stuck with the material that was applied when the home was constructed. If you are starting to notice that the exterior of your home needs a facelift, or the siding is looking worn due to neglect, then you may be in the market for new siding.

Regardless of whether you are building a new home and need new siding or looking for replacement siding, shopping for it can be daunting. New siding is available in many choices in composition, size, style and color. Furthermore, some siding is factory finished and other siding is finished on site. The most common types of siding include:

Natural wood (plank and plywood)
Wood composites
Fiber cement
Aluminum
Steel
Vinyl
Stucco
Brick and stone (or a combination)

Which type will work best for your home? Several factors will influence the answer to that question. The most important factors include product quality, architectural compatibility, appearance, maintenance requirements, ability to repair-replace damage and cost. Keep in mind, when it comes to siding it is not recommended that you look for the cheapest you can find. Siding is an important investment in your home, not to mention the fact that it is one of the first things people will notice about your home. Quality material will cost you more, but it is definitely worth it.

10 Hints for Homebuyers

2008-01-21T08:35:00.000-08:00
Congratulations on your decision to purchase a new home! Your first step toward buying your new home will be to analyze your needs. Your real estate agent can assist in analyzing your needs so that you will be able to get a clear picture of exactly what you want your new home to look like and how it should function for you and your family....

First, you should write down why you are looking for a new home. For example, are you currently renting and would like to have a home where you can begin building equity? Maybe you recently married and have outgrown your current residence. Or, maybe you have just gotten a promotion, which requires you to move to a new city. These factors will all have a bearing on how you approach your home search.

Second, establish a time frame that you would like to stay within for buying your home. Depending on your reasons for wanting a new home and the current state of the market in the area you are looking to buy, you should be able to come up with a rough guideline, which you can finalize at a later time.

Last, you most likely have a mental picture of what you would like your house to look like and what features it should have. It's very important to write these ideas down to avoid any ambiguity later in your home search. You should make at least two lists: one should be a list describing your dream home and the other should list the features of the home that are an absolute must have in order to buy it. In a perfect world, your new home would fulfill both lists 100 percent. It is more likely that you will end up blending the two lists into a schedule of prioritized items as you progress through the buying process. This is a natural and evolutionary process as you get clearer about what you want and what is available.

2. Get pre-qualified and pre-approved

Now that you have your list of features you want in your new home, you are ready to start looking! Well, not just yet. You are going to need to know in what price range to look. There are two ways to go about this. You can get prequalified or preapproved for a mortgage.

Either way, you will need to contact a mortgage company. There are some key differences between prequalification and preapproval for a loan that you need to be aware of. Loan prequalification is a simple process. It takes into account very basic information regarding your financial status and gives you an amount for which you may qualify. This can be done strictly on a verbal level or electronically over the Internet. The prequalified amount is based solely on the information you provide. In most markets, prequalified buyers usually hold little clout compared to preapproved buyers due to the fact that the information given during the prequalification process is not thoroughly investigated and therefore may be unreliable. Where a preapproved buyer is actually approved for a loan of a certain amount, a prequalified buyer is only told that they might be approved for a certain amount.

Pre-approval is a much more involved process. The lender will take all pertinent information regarding your finances and perform an extensive check on your current financial status. This will ultimately give you the exact amount that you will be eligible for (depending on what type of loan you decide to go with). Being preapproved lets the seller know that you have gone through an extensive financial background check and there should be no unexpected obstacles to buying the home. You can see how being preapproved would be more attractive to a seller than just being prequalified.

3. Get local area information

Now that you have your list of needs and wants and you know how much you can afford to spend, it's time to look at some houses! Not just yet. Step back for a moment and consider the larger picture. People don't just buy a house; they buy the neighborhood the house is in. Think about that...if you found the perfect house but it was in a neighborhood that wasn't to your liking, would you make an offer on it? Most likely the answer would be, "No."

So, you will need to make another list of what type of neighborhood you want to live in. You will most likely want to consider things like how living in the neighborhood will affect your drive time to and from work, what amenities are offered (swimming pool, tennis courts, park, etc.), and, if you have children who are attending school or soon will be, what school district you will be in and how close the schools are. You may even want to make two lists just as you did with your home criteria.

Your real estate agent can help you consolidate the information from your list of needs and wants for your home, your preapproval, and your list of needs and wants for the neighborhood. From this, you can incorporate this information into a broad search profile, which will then be narrowed down to specific areas dictated by the market in which you will be looking. Your agent's experience in local markets will be an invaluable resource during this step.

4. View home listings

At this point you will have a good idea of what you can afford and the type of area you will want to invest in. Taking that information into consideration, you are ready to embark on your property search. If you don't know much about the city to which you are moving, you will most likely want to start your search by finding areas that meet your criteria and then narrowing your search to particular properties in the area.

There are a few ways to go about this. Possibly the most efficient way to find properties is to allow your real estate agent to keep you up-to-date on available properties that meet your criteria, and then allow your agent to screen these properties for you. When your agent presents you with a property that interests you, he or she can arrange for you to tour the property at your convenience.

You can also access local publications highlighting available real estate in the area; contact and visit the local Chamber of Commerce, look on the Internet; and even drive through areas that you feel would meet your needs. Driving around a particular area looking for properties for sale is good because you can actually see the property. However it can be very time consuming and it is a "hit or miss" process.

5. Make an offer on your home

Now that you and your real estate agent have found the home you would like to purchase, it's time to make an offer. Taking into account the recent sales of homes in that neighborhood which are similar in size, quality, conveniences, and amenities, what are you willing to pay for the home? Your real estate agent will consult with you and advise you on how to create an offer that will have the best chance of being accepted.

Your agent will ensure that you have everything down in written form... no verbal agreements. After consulting with your agent to put your offer in a written contract that meets all the legal requirements according to local and national guidelines, your agent will present the seller with a written document detailing what needs to be done by both parties to execute the transaction.

The contract should protect the best interests of all parties involved and should be comprehensive in nature. Your agent will also ensure your financial position as the buyer by including any necessary contingencies, which would protect you if a particular requirement were not met. Once the seller accepts it, it may be too late to make any changes.

The contract, though not limited to this list, should include the following:· A legal description of the property· The offering price · The down payment · Financing arrangements · A list of fees and who will pay them · Amount of the deposit · Inspection rights and possible repair allowances · The method of conveying the title and who will handle the closing · A list of appliances and furnishings which will stay with the home · The settlement date · Any relevant contingencies
Remember that the legalities of this phase are very important. If you have any questions or concerns, they need to be addressed right away. After all, no one has ever said at their closing, "I wish I had asked fewer questions."

6. Negotiate your offer on the home

Once your offer is made, you and your real estate agent may need to enter some negotiation in order to reach an agreement. Keep in mind that almost everything is negotiable when you are buying a house. This can give you a great deal of leverage in the buying process -- that is, if you have adequate information and you use it in an appropriate manner. Your agent will have the market knowledge and negotiating expertise necessary to make sure that your offer is accepted at the best price and terms possible for you.

Some of the things that you may have to negotiate are:· The price · Financing · Closing costs · Repairs that need to be done · Appliances and fixtures · Landscaping · Painting · Occupancy time frame

The key to successful negotiating is keeping in mind that the end result must make both you, the buyer, and the seller happy. Otherwise, negative feelings will persist throughout the remainder of the process and someone may walk away feeling that they were not treated fairly.

7. Find the vendors that you need

After your offer has been accepted, your agent will supervise the coordination of all necessary vendors and serving as your advocate when working with each vendor. Your agent will make sure that the vendors have access to the property at the appropriate times to perform their procedures and oversee the execution of those procedures on your behalf.
For instance, the property will need a thorough examination. Working with your lender, you may need to have a formal appraisal and a survey done for the property designated in the contract. A property inspection, a foundation inspection, and an environmental inspection may also need to be completed to make sure that the property is up to the standards set forth in your written agreement. If there are issues or inconsistencies brought to light during this time, it may delay or even nullify the contract depending on the contingencies set forth in the contract.

Homeowner insurance is another very important item that will need to be taken care of at this point. Insurance experts recommend that you obtain insurance equal to the full replacement value of the home. Unless you have insurance coverage on the home, the closing can not proceed. Having these procedures done in a timely and professional manner is a must. Investigate each vendor to make sure that they are reputable and have a clean operational history.

Your agent's experience in this area will be invaluable in making sure that everything is completed on time and in a professional and legal manner.

8. Pre-close preparation

As the closing date draws near, your real estate agent will contact the escrow company or closing attorney and your lender to make sure that all the necessary documents are being prepared, and that they are complete, accurate, and delivered in a timely manner. Your agent will also need to confirm that the documents will be delivered to the correct location so they can be reviewed and that they will be ready for the appropriate closing date.
At this point, you and your agent should find out what form of payment you will need to bring to the closing for any unpaid fees. Make sure that your payment is made out to the appropriate party.

Ensuring that each closing document is ready and available will enable you to have a quick, easy closing.

9. Closing on your home

"Closing" refers to the meeting where ownership of the property is legally transferred to the buyer. It is a formal meeting in which most parties involved in the buying/selling process will attend. Closing procedures are usually held at the title company's office or lawyer's office. Your closing officer coordinates the document signing and the collection and disbursement of funds.

Your agent will be present at your closing to read the documents on your behalf, answer any questions, or help to resolve any last minute or unexpected details that may come up.
In order for the closing to go smoothly, each party involved should bring the necessary documentation and be prepared to pay any related fees (closing costs). There may be more than one form of acceptable payment for your closing costs, so ask the closing officer which form of payment will be required and to whom it should be made out. Closing costs will generally total an amount equal to 2 to 3 percent of the total loan value, not including down payment and the buyer's escrow account.

Sellers sometimes pay for a portion or all of the closing costs, depending on local market conditions, terms of the purchase contract, and the seller's cash and timing considerations. Any such concessions should be acknowledged in writing. Most lenders will allow a credit from the seller to the buyer for the non-recurring closing costs. However, they usually won't allow a credit that reduces the amount of the buyer's down payment or any of the buyer's recurring costs, such as expenses for fire insurance premiums, PMI, or property taxes.

10. Post-closing activity

Congratulations on the purchase of your new home! Now that you have taken ownership of the property you will need to have your local services such as electricity, cable, and phone set up. Your real estate agent can help you coordinate the set-up of these local services. No doubt your agent already knows who the local vendors are for such services as water and electricity, as well as others, so he or she can help provide you with a list of contacts.

Sarah's Recipe Corner

2008-01-21T08:19:00.000-08:00
Everybody loves my Wife Sarah's Taco Dip Many friends ask for this recipe so I am posting it here for any and all who may want to try it!

PREP TIME 20 min
READY IN 20 Min

INGREDIENTS

1 (16 ounce) container sour cream
1 (16 ounce) jar salsa(we use Ortega, its smooth)
1 large tomato, chopped
1 bunch chopped green onions
1 small head iceberg lettuce, shredded
1 (6 ounce) can sliced black olives, drained
4 strips bacon, if desired
2 cups shredded Cheddar cheese

DIRECTIONS
Spread the sour cream in a 9x13 pan, followed by the salsa. Then add the tomatos, lettuce and cheese. If you use bacon, cook until crisp so you can easily crumble. Add bacon, olives and onions to top. (For a more filling version, try refried beans and/or ground hamburger with a packet of taco seasoning mix. We prefer the version above.) Serve with tortilla chips of choice.

Why Choose Me?

2008-01-09T11:29:00.001-08:00
Hello,

After five years working as an attorney, primarily as an officer and prosecutor in the US Air Force, I decided it was time to make a change. I'm excited to use the skills I've practiced as an attorney including hard work, attention to detail, negotiation and tireless advocacy for the benefit of my real estate clients.

My Story

You might wonder why a licensed (inactive status) Utah attorney with 5 years of trial experience would want to sell homes. Good question! While the law provided me with an excellent platform to practice critical thinking, negotiation and advocacy in a high stress environment, I'm happiest when working with people. I chose real estate because I love investing and serving others, and know my skills as an attorney will make me a detail oriented agent and TIRELESS advocate for my friends and family.

1. Rely On Me To Pay Attention To Details

As a military officer and attorney, I had to manage multiple projects and handle many different complex issues simultaneously while making sure every “I” was dotted and every “t” was crossed. You’ve heard the old saying, “The devil is in the details.” I love to make sure that every issue is handled completely and thoroughly, a critical skill in all real estate transactions!

2. Feel Good About my Ability to Communicate

The ability to effectively communicate is one of the most critical skills for a real estate consultant. Working as a trial attorney in the Air Force, speaking with Judges, expert witnesses, and enlisted members taught me to effectively communicate no matter what my audience. I use these skills in all my real estate transactions and negotiations.

3. Be Confident That I Influence Others Positively

Rest assured that I have the ability to influence and persuade people. I love finding solutions to problems, overcoming difficulty and taking care of the people who place this huge purchase in my hands. I will treat your money like it is my own.
Indeed, the real estate industry does not need another real estate agent, but it does need somebody who is detail orientated, a great communicator and strong at influencing others.

The next time you are in a conversation with a friend or family member who is in need of someone who is well organized, a great communicator and somebody who has proven success influencing and persuading people, call me!

I'll be someone you want to recommend for advice on all your local and national real estate needs. I look forward to talking to you, soon.

Very truly yours,

Matt Meyer
Your Real Estate Consultant