I’ve been in Real Estate for 6 years. It’s not a long time for most at a job, but for the world of ACTUAL PROFESSIONAL REAL ESTATE, it’s an eternity.  Most of the top agents I work with have that many years, most of the ones that have gone back to their old jobs, did not.

I tell you that to say, none of us can remember being so motivated to almost call potential clients a name if they didn’t think it was time to buy.  Seriously, if you are paying $800 a month or more and have not been late on your bills and you have a job, you NEED to buy a home.

Don’t take my word for it, here’s what the NY Times says:

Unfortunately, we do not know when this golden age will begin, because we will be able to identify a bottom to the housing market only with the benefit of hindsight. But as it does with the stock market, the moment will probably arrive when everyone is feeling the most pessimistic.

That moment is certainly getting closer. Housing prices have fallen drastically from their peak levels in many areas of the country. Rates on 30-year fixed-rate mortgages are already close to 5.5 percent, and this week there were suggestions that the federal government might try to drive them down to 4.5 percent, a truly incredible figure to be able to lock in for three decades.

Meanwhile, first-time home buyers have the same advantage they have always had, which is that they do not have to sell their old place before buying a new one. That is an added advantage in areas where many available houses simply are not moving, because the people trying to sell them will not be bidding against you.

If you’re hoping for a recovery in the housing market, you ought to be cheering on the first-time home buyers. When they purchase homes, their sellers are free to move on or move up, stimulating further sales.

They finish up the article with some good advice:

Still, for anyone feeling the urge to buy, a number of practical considerations have changed in the last year or two. The basics are back, like spending no more than 28 percent of your pretax income on mortgage payments, taxes and insurance. Even if a lender does not hold you to this when you go in for preapproval, you should hold yourself to it.

If you watched CNBC today you likely heard "Bond Guru" Bill Gross comment on interest rates.  His prediction is that rates will continue to fall, likely as low as 4%’s.  1% reduction in rate is the equivalent of a $10,000 reduction in price.  So homes will be slightly more affordable.  The big question is whether buyers who are taking advantage of the market will wait after hearing this news.

The bottomline should require you to ask these questions:

1. Why am I moving?
2. What is my motivation for moving? (yes ask it again)
3. Why do I NEED to buy?

If you are buying investment property then there might be a reason to pause.  If you are renting, you should have already bought something.

Here’s more from the interview:

"The mortgage rate will come down another 50 to 100 basis points," Pimco’s founder and chief investment officer said. "That’s basically what the government needs. They need a 4 1/2 percent to 5 percent 30-year rate in order to support home prices and, yes, to encourage refinancing and the process of reliquification within the economy. "

His advice: "[OWNERS] Don’t refinance yet. "

Purchasers on the other hand should move forward, especially, first time home buyers who should take advantage of the $7,500 Tax Credit while it lasts.

Some time next year, he sees stabilization coming to the economy, and lower mortgage rates are an essential part of that process.

After much feedback I’ll be updating the newsletter that comes out of here. There’s got to be a better solution, feel free to update me on that!

After writing about accountability a few weeks back, I decided to check my self and posted a week’s worth of activities .  Be sure to check it out if you have any interest in becoming a real estate agent or want to know what I am doing every day .

The market is up and down on a weekly basis.  Great deals are still selling in 2 weeks, good deals are sitting.  Homes that are price correctly will sell in 60 days or less.  Other can sit up to 6 months to 1 year.  A little milestone was reached as several parts of the county dipped under 12 months of inventory which.

If you are watching the news you are drinking up the fear… from a Water Hose.  My journey to NO FEAR this week has taken me down steps and I don’t think I can be concise about it, but I do want to share with you my journey.

• I had my first reading of Who Moved My Cheese and everything everyone says about this book is true. It really forced me to wake up and realize, I’m "hemming and hawing" and not really …
• Shift - ing - Gary Keller of Keller Williams just released his new book, Shift .   In it he describes how the real estate market has shifted and what you have to do to be successful in a shift.  Short story… back to basics - and by basics, it’s being effecient and creative… but more importantly changing and having…
• NO FEAR - Many of you know I’m a Christian.  I am not the best example but I do read THE WORD and I was listening to Pastor Dennis Rouse talk about Fear and the economy.  As many people are away, there are cycles of life and this too will pass.

II Timothy 1:7 For God has not given us a spirit of fear, but of power and of love and of a sound mind.

I don’t know about you but I’m not about to succumb to a spirit of fear.

All of these changes got me on the road of POWER and I noticed that "SHIFTING" is BIblical as well.

Revelation 3:1-6 (paraphrase)

“Wake up! Stop just doing the same things you have always done and change how you think and how you live!”

When faced with a challenge, we can either adopt (quit), abdicate (become bitter), or adapt (overcome).

The "trials" we are going through are expected, whether it is David, Jesus or Peter or basically EVERYONE in the Bible, they all went through trials.  Change is important in surviving, but the one thing that will work everytime is:

FOCUS ON HIM

But seek first his kingdom and his righteousness, and all these things will be given to you as well. Matthew 6:33

I liken it to driving a car.  When I’m in the ditch or riding on the median, I’m literally tearing the wheel away from Jesus, when my life feels like I’m in the HOV lane, it’s because I’M THE PASSENGER .

As we go through this tough time, just keep your eyes on HIM.  The Bible says he speaks in a "still, soft voice."  If you are having a hard time hearing him, it might be because you have the "World’s" volume up to loud.  Try going without TV for a week and see if your perspective changes.

I’ll be back on topic next time, but if one person gets encouraged, then the time spent writing this is worth it.  Let me know.  Drop me an e-mail or comment!

Unless you’ve had your head in the sand all week, then you know that there’s talk of an economic bailout that should cost you and I about $10,000 a piece. It got me thinking about accountability .

Whatever happened to personal responsibility?

As I finished my workout today I passed someone having a conversation about that very topic.  Apparently this person’s child had stolen something and didn’t think much of it.  The distressed parent did not know what to do.  Her ultimate method of "accountability" was to let the child know that if it happpened again and he got caught, then she would let the authorities deal with it.

What’s somewhat funny about this story is this is exactly what has happened to our economy.  Re-read that story above and let’s replace some words:

[Our Country's ] ultimate method of "accountability" was to let the [Industry ] know that if it happpened again and they got caught, then they would let the [Government ] deal with it.

Sorry, but that’s not really what I want.  I doubt you want the Government to take your money at gunpoint [TAXES] and bail out these financial districts either, when the solution is a simple, time tested word, ACCOUNTABILITY.

In Real Estate, there is no accountability.  There’s almost no barrier to entry for the mortgage industry or to be a real estate agent.  The public puts absolutely no weight in these professions.  Realtors are often compared to used car salesmen and when it comes to selling a home, most home owners would rather have a colonoscopy than think of paying a Realtor for their services….

Mortgage Broker and Real Estate Professionals are responsible for handling, for most, what is the biggest investment of their entire life. In the case of Real Estate Agents, in some states they have a fiduciary responsibility to look out for their client — this is the same responsibility that an attorney has! It’s hard to believe then that the state and the industry know the value of a Real Estate Agent but the public and the agent themselves don’t take the responsibility seriously… and WHY?  Because there is no accountability.

Mortgage Broker gives you a loan that on paper looks ridiculous but still clears underwriting.  What can you do?  At best, file bankruptcy.

An Realtor suggests a price to win your listing and is not honest about the market.  You are happy in the short term but in a declining market, you’ve just signed your foreclosure papers.

Now I’m done with my rant, but I’d much rather see accountability and standards added to the Real Estate industry as a whole than see these bailout plans.

Unless you live in a cave, you’ve likely heard the news about Lehman Brothers.  Other famous names are being thrown around as well in, as Truliablog put it, “a sad game of who’s next.”

Well what’s it mean to metro Atlanta.  Truth be told, it’s way too early to tell but if there’s any indication here’s some thoughts on it. 

MORE SALES FOR GEORGIA

New York, one of the big three of places that have people relocating to Georgia, will see an increase in listing inventory.  New York’s market, especially the higher end market, is one that has been, well, bullish.  For a niche of America, it’s a big one.  However, with 10,000 jobs going away, people will be looking to regroup and maybe relocate.  Atlanta is on their list.  Not only can they find employment, but they will likely not have to give up their lifestyle that they are accustomed to in New York.  So this is a bad thing for them but a good thing for us. Assuming this happens. 

It’s like my Grandma says, “It’s a backward blessin’” for those folks.  They’ll get a lower cost of living and a new start out of something that’s pretty devastating.   Of course, this is from my perspective that Georgia is the best place to live.

The impact will send some shockwaves, but my personal opinion, much like the stock market, is that it’s overall impact will be minimal.  The real estate market is already seeing the light at the end of the tunnel so it’s not too hard to imagine a few more shoes dropping before we pull back out. 

Better get in on the good deals while you can.

With the current market conditions it’s likely that if your home has been on the market, you might have had a price reduction.  What’s interesting is where you end up.  Look at the prices, are you Wal-mart priced?

What’s Wal-Mart pricing?  We all know that the tried and true method to get us to buy something is to price it at what the seller wants, say $5 then knock a penny off, to $4.99.  Our mind says, “Aha, $4!” when we just paid $5 for the item.

Well some agents and home owners have the funny misconception that Wal-mart pricing is the way to go with homes.  The fact is that Walmart pricing absolutely works for home buyers too.  It works, against you because of one key difference…

AT WALMART, YOU DON’T NEGOTIATE.

So buyers see your price at $399,900 and they think, “Great it’s $399K.”  At a bare minimum, you’ll be getting an offer less $900.00.

It actually goes much further then that.  This is not simply some idea that I’ve come up with (although I would not fault you if you thought that).  No, this concept has actually been backed up by Cornell University.

Using data from 27,000 real estate transactions in two U.S. markets, they found that buyers paid higher prices when asking prices were more exact [like rounded numbers].

People learn to associate precision with smaller magnitudes, wrote the resarch team led by Manoj Thomas. 

Furthermore, with this new generation of home buyers using the internet, it makes absolutely no sense to ever list your home at a price that does not take advantage of this. 

A home priced at $324,900 will only appear for hom buyers searching $325K and down.  However, if the home were correctly priced at $325K, home buyers from $350K (in a search from $350 to $325K) and under would see this home.  The reason for this is that most internet search engines use 10’s and 25’s, not 99’s. 

So next time you get ready to put your home on the Atlanta Real Estate market, be sure not to price it like good ole’ Sam Walton would.

In this month’s Georgia Association of Realtors magazine there was a nice reprint of RetlyTrac’s statistical information.  I thought it was well worth sharing!

8 is the Rank of Georgia out of 50 states for foreclosures.10 is the average number of years that it will take for a home’s value to double in Georgia. 

34 is the average age of a first time home buyer. 

60 is the PERCENTAGE of the average home owner’s wealth that comes from their Georgia Home’s equity. 

112 is the percent increase in foreclosures from 2nd quarter 2007 to 2nd quarter 2008

5 is the rank of 2007 in terms of existing home sales

171,000 is the average net worth in dollars of a home owner.  

36 The number of times a home owner’s net worth is more than a renter’s (almost).  (The average renter’s networth is only $4,800)

I was particularly intrigued to see the networth number. We all have probably sat down and worked those numbers out and I’m as jaded as the next person when it comes to the seemingly astronomical figure that comes out of it (my car does not add to my net worth in my opinion). The fact remains that a home is like a forced savings account and holding real estate long term is a proven piece to your financial success.

Are you waiting till prices drop further?  I have two KEY questions for you.

1. When is the right time to buy?
2. When do you know where the bottom is?

That’s one word that is tough to use in this current real estate market. Nothing is predictable right now. Months that historically good are bad and ones that bad are good. Weekends you’d think would be full of showings are filled with people going to see Batman.

The best slogan I’ve heard in a long time is “Don’t Wait to Buy, Buy and Wait.” I thought it was very telling. In what other market can you buy a 2000 Square Foot all brick ranch for $140K that should retail for $200K in 3 years with little to no work.

As mentioned in another article, St Marlo is a great place for executive homes and deals on them. With an average price of $1 Million, you can get in to a foreclosure for less than $600!

Homes like the one I listed on 3551 Bogan Mill Road or 4850 Shellnut Path would have sold in 30 days. Now they are steals, ripe for the taking.

Good news for the Jarvis Team is that we are officially down 1% for year compared to last year, which was the best year ever.

We’ll see how this year ends.

..

Oh, and By the way, I’m NEVER to busy for your referrals.