Defining a true real estate recovery

Defining a true real estate recoveryMood of the Market
By Tara-Nicholle NelsonInman News™
February 21, 2011
Our esteemed 33rd president, Harry S. Truman, once said, "It's a recession when your neighbor loses his job; it's a depression when you lose yours." In the vein of everything old becoming new again, it seems that this eye-of-the-beholder issue has never rung truer than when it comes to pinpointing when the current/recent real estate recession began, and when it ended (or will end, depending on your point of view).
The Standard & Poor's Case-Shiller Home Price Indices calls recession and recovery in terms of peaks, troughs and the rises and falls thereto and therefrom. The Case-Shiller called the top of the market in 2006 or 2007, depending on the market, and the bottom of the national housing market in the spring of 2009; the Case-Shiller is primed to mark another nationwide bottom -- the second dip -- any moment now.
Last fall, a committee that studies business cycles for the National Bureau of Economic Research raised more than a few eyebrows when it declared that technically, the recession had been over for more than a year. The NBER's Business Cycle Dating Committee said the recession began in December 2007, and ended 18 months later when the economy stopped contracting and began to expand again.
But for many individual Americans who own homes, the Truman definition rules their personal sense of when the recession began. That is, the housing crisis became real only when the prospective listing agents told them what the comparable sales looked like for their home, when they received a notice from the county that their property taxes were being reduced (without having applied for a reduction in their home's assessed value), when they lost their job and realized they couldn't sell the place for what they owed on it, or when their mortgage payment began increasing and they realized they couldn't refinance the loan because the place wouldn't appraise at their current loan balance.
While the housing bubble's deflation occurred in a geographically spotty manner over a year's time, which made it even tougher for the average Jane to pinpoint -- it was still more of an encapsulated event -- than recovery will be. Media outlets and real estate data reports have proliferated faster than Android apps, so that recovery and its absence are alternatively heralded, predicted or dismissed on a weekly or even daily basis in various outlets.
The Case-Shiller ostensibly views recovery as a return of home values to their mid-decade peaks, while former Fed Chair Alan Greenspan recently said recovery wouldn't be here until housing prices rise another 10 percent from the status quo.
All these definitions have turned the issue of when the real estate recovery was, is or will be into an economic Tower of Babel, with every analyst and report shouting out about a different definition of recovery, so that no one really understands what the other is talking about.
And in the minds of homebuyers, sellers and homeowners, this disconnect is exponentially gappier, because their positions on what recovery is is largely driven by their own perceived interests, as I realized in a recent conversation on my Facebook page about the Obama administration's proposal to phase Fannie Mae and Freddie Mac entirely out of existence.
I had sketched out a number of implications to the proposal -- including hikes in loan costs, interest rates, down-payment requirements and, generally speaking, the barrier to entry to homeownership. But I'd also mentioned that the Fannie/Freddie bailout has U.S. taxpayers $130 billion in the hole, and counting, and that the proposal provides a set of options to resolve the troubling and ideally, very temporary, current state of affairs, in which 90 percent of the home loans originated on today's market are backed in some way by the federal government.
Most real estate professionals and virtually all prospective homebuyers thought this was outrageous and would cripple the market. Those viewing the matter from their perspective as taxpayers thought that for the government to do anything but phase Fannie and Freddie out would be the real outrage. "But recovery will take longer," cried the first group, "or never happen at all," indicating that their definition of recovery was probably tied to a rise in home values or sales activity. The other group thinks recovery, by definition, will include a stable market, not propped up by the government, where homebuyers and refinancing homeowners are required to document some serious creditworthiness and put significant swathes of their own skin in the game when they take mortgages.
In his 1980 presidential election campaign, Ronald Reagan appended a definition of recovery onto Truman's definitions of recession and depression: Recovery, Reagan said, "is when Jimmy Carter loses his" job -- as U.S. president.
In today's American economy, there is no single person whose position in or out of any office will generate the housing market's recovery. The fact is, many homeowners won't think the market has recovered until it gets back to their mental target value for their home; and some buyers won't think recovery is here until they've been priced out. In every household, there is a single person whose sense of what recovery is will dictate whether it has been achieved in his or her mind: you.
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.

Short Sales and long lasting candles

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January 19, 2011 in Blog by admin
Short sales and long lasting candles
I recently saw a short sale listing come on the MLS at what seemed to be a very attractive price. I called the listing agent to find out why it was priced the way it was. I was told, “We are just trying to getan offer so the bank will start the negotiation process.” I am sure this Realtor had the best intentions, but unfortunately they are setting both the seller and the potential buyer up for lots of frustrations.
If you choose to write an offer on a short sale, make sure your Realtor does a market analysis on the home. If you were to write an offer on the above listing example, more than likely you would be inescrow for several months, only to find out the bank wants considerable more than your offer is written for.
Is there a secret? I am not sure I would call it a secret, but basic homework, common sense, a market analysis and “qualifying the listing agent” by your Realtor can make all the difference in the world.
Qualifying the listing agent? Yes, unfortunately many Realtors are attempting to do accomplish something they have never accomplished before. Have your Realtor “qualify” the listing agent. Your Realtor should ask the listing agent, “Have you completed a short sale in the past? Do you have a system in place?” Just get a feel for how knowledgeable they are about the short sale process. Based on theanswers, you and your Realtor can make an educated decision about moving forward with an offer, or not.Short sale process:Identify a home.Have your Realtor do a market analysis on the home.Find out how many loans are on the home.Qualify the listing agent.Write an offer, your offer price is very important.Offer is accepted by seller.Wait for bank to approve the sale.Pray. (If you don’t pray, light some long lasting candles)Month one will come and go.Pray some more. (Relight candles)Month two will come and go.Keep praying. (Relight candles again)Month three to month six, you should have an answer.Move on, if bank denies.Rejoice, if bank approves.

Hang Drapes

Drapes will not only help block drafts, they'll add a nice layer of softness to your walls. Choose tightly woven fabrics with an insulated lining (often foam acrylic) for the most warmth, and hang them from ceiling to floor, which will maximize coverage and anchor the room, creating a pleasantly cocooning effect.Read more at Wholeliving.com

Boise State breaks ground to start student housing project

by Jennifer GonzalezPublished: February 3,2011 Time posted: 12:00 pmTags: Boise State, ESI Construction, Oz Architects
Construction began Feb. 1 on the Lincoln Avenue student housing project that will provide Boise State University with additional housing for 360 students.
“Additional campus housing further develops the sense of citizenship we are building by placing students in the center of campus life,” Boise State President Bob Kustra said. “This housing community will allow a student to live on campus all four years, which studies show positively impacts student success.”
The project lines Lincoln Avenue south of the Lincoln Parking Garage. The 90 two-story townhouse style units offer a campus living option for upperclassmen. Expected completion date is January 2012.
State school officials recognize the importance of junior and senior students living on campus, but have not had the money to build more housing. The $15.8 million housing project, approved in January, is paid for with a combination of redirected bond proceeds, a result of savings from previous building projects and university and student housing reserves. The university will be repaid with student housing revenues.
Boise-based ESI Construction is general contractor for the project. Oz Architects of Denver is the architect.
The Lincoln housing project is Boise State’s dedicated to upperclass students. Demand for on-campus housing at Boise State continues to grow and the university has doubled its student housing capacity since 2004. About 2,300 students currently live on campus in six residence halls and a variety of suites/apartment complexes.
“To have a residential experience you have to have the right residential facilities,” said Jeff Hale, executive director of University Housing. “This is more than just a place where students will live. It completes the collegiate experience and enables students to better connect to resources like the library, campus recreation, the Student Union and health services.”
Each unit has four bedrooms and two baths and will offer students more space than is typically found in student housing. The initial 360-bed project that began today is part of a larger 874-bed design that may be completed at a later date.
The new housing option will help encourage juniors and seniors to continue to live on campus and be active members of a growing on-campus community, said Alexa Walker, student president of the University Housing Association.
“A four-year degree plan will now be matched with a four-year residential living plan for students,” Walker said.

Hot Design Trends

By Erica Christoffer, REALTOR® Magazine

Smaller spaces, energy efficiency, Earth tones, and outdoor entertainment are all the buzz as the latest design trends debut at the International Builders’ Show in Orlando this week.

A survey of 2,000 consumers conducted by Better Homes and Gardens found that buyers don’t want any “wasted space” in their next home. They are seeking more value for their dollar, said editorial director Jill Waage, who presented the study’s findings Thursday. Affordability remains a high priority as well as energy efficiency, which was ranked highest to 68 percent of the consumers polled.

“Consumers are once again dreaming about their next home as well as planning ways to make their current home reflect their personal style and needs,” said Waage. “They are also setting priorities and watching their wallets in the process.”

The top ranked living space features listed by consumers are a separate laundry room, additional storage space with walk in closets or build-ins, a home office or workspace, outdoor living areas, at least one bathroom with its own private bath, and everyday eating space in or close to the kitchen.

“Today’s family wants a hive area where they can move seamlessly from mealtime to tech time to game/entertainment/hobby time to homework time,” said Waage.

Kay Green of Kay Green Design echoed Waage’s findings in her International Builders’ Show presentation Friday. “People want more of a clean line look with contemporary interiors,” Green said. “Stainless steel continues to be popular.”

Here are more design trends taking hold in 2011:

• Outdoor amenities such as grills, sinks, showers, and entertainment areas.
• Freestanding tubs with a separate stand-up shower in the bathroom.
• Color schemes – Earth tones, blues and blue greens, chocolate browns.
• International design influence, especially Asian design in both décor and functional products.
• Ceiling details accenting rooms within open floor plans.
• Media space for flat screen TVs and gaming systems, and living areas wired for technology.
• Organizational features, built-ins, and smart storage areas throughout the home.
• Universal design features incorporated in subtle ways.
• Artistic tile in kitchens and baths, often emulating organic patterns found in nature.
• Energy efficient products – washing machines, dish washers, toilets, and showerheads.
• LED lighting incorporated into sinks, showers, and medicine cabinets