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keeping you current

By Madeleine Romanello

June 2008

Real Estate Magazine
“When I interviewed a dozen, topproducing, active Realtors, I was impressed by the success they were all having in getting sellers to price their homes correctly by using facts, data, statistics, and logic to overcome emotional objections.”

Real Estate Magazine
“Today’s Realtor needs to be a counselor and an educator-not just a salesperson. To do so requires constant research and evaluation of the market and effective -Howard Brinton interpretation and presentation of Real Estate Magazine that data.”

Success Magazine
Attaining your American Dream
Investing in Real Estate NOW “For either the first-time homebuyer… or the savvy investor who has some cash, this could be-Landon Taylor, to the perfect time buy real estate.” First American Title

ource: Success Magazine 5/2/08

Smart Money.com
“Today home prices have fallen so much, mortgage rates are so low, and personal income is so high — that homes are more affordable today than at any other time, ever.” - Donald Luskin

ource: SmartMoney.com 5/2/08

First American Core Logi

urce: First American Core Logic 1st Quarter 2008 Report

Wall Street Journal

ource: Wall Street Journal 5/07/08

Wall Street Journal
.

"It is really remarkable how much where we are today looks like the bottom we've had in the last three cycles…It's bottom-fishing time, - Wellesley College Prof. Karl E. Case, I think.” one of the leading experts on the
housing market in the country

ource: Wall Street Journal 5/07/08

NABE
“Our panel anticipates an improvement in credit markets and a bottoming out in housing this year.”

-Ellen Hughes-Cromwick, President National Association for Business Economics

Source: NABE 5/25/08

4,800

5,000

5,200

5,400

5,600

5,800

6,000

M ay Ju ne Au gu Se st pt em be r O ct ob er N ov em be D r ec em be r Ja nu a F e ry br ua ry M ar ch Ap ril Ju ly

Sales – U.S.

Bloomberg.com

New-Home Sales in the U.S. Rose 3.3%

ource: Bloomberg.com 5/27/08

Wall Street Journal
The Housing Crisis Is Over
“The dire headlines coming fast and furious in the financial and popular press suggest that the housing crisis is intensifying. Yet it is very likely that April 2008 will mark the bottom of the U.S. housing market. Yes, the housing market -Mr. Cyril Moulle-Berteaux, managing partner of Traxis is bottoming right now.” Partners LP,
a hedge fund firm based in New York.

ource: Wall Street Journal 5/06/08

MSN Real Estate
“Waiting for the absolute bottom to hit before buying puts you at risk of missing it and getting caught up in a market on the upswing. Plus, for some first-time home buyers, owning simply makes better economic sense than renting.”

urce: Melinda Fulmer, MSN Real Estate 5/13/08

Money Magazine
New rules for home buyers
There's no guarantee that prices have hit bottom yet - but that doesn't mean that you can't get a great deal now.

Rule 1: You can't time the bottom
Face it: The house you buy today will more than likely be worth less next year. That could get you thinking about trying to time the bottom. Resist. It's harder to do than you think, and this is the best buyers have had it in two decades, with inventories up and mortgage rates low.

ource: Money Magazine 5/12/2008

Money Magazine

Rule 2: One reason to buy now mortgage rates
Homes are plentiful and will remain so, but financing will be getting more expensive. True, the Federal Reserve has slashed interest rates, but fixed mortgages don't directly follow the Fed. They reflect the bond market's expectations about inflation, which remains a concern. The 30-year, now at 6.1%, will likely reach mid-6% by December and 7% in 2009, says Celia Chen of Moody's Economy.com. That means there could be a penalty for waiting to buy even if prices fall more. Today a $250,000 loan would set you back $1,500 a month. At 7%, a $1,500 payment gets you only a $225,000 mortgage.

ource: Money Magazine 5/12/2008

Mortgage Rate-30 Year 6.3 Conventional
6.2 6.1 6 5.9 5.8 5.7 5.6 5.5 5.4
January 24th May 15th

Source: Federal Reserve

Mortgage

Money Magazine
Rule 3: Another reason to buy - rates on big mortgages
Mortgages in amounts greater than $417,000 - the limit for buying by federally sponsored mortgage agencies - usually run a fifth of a percentage point above conventional products. But investors are shunning jumbos, which now average 7.2% and are unlikely to drop much this year, according to HSH Associates. Certain jumbo borrowers could get relief, however. A new law allows Freddie Mac and Fannie Mae to buy loans as large as $729,750 in 71 high-priced areas. So far "jumbo conforming" loans average 6.6%. The program has gotten off to a slow start; you'll need to shop around. And unless Congress acts, this bargain will disappear at year-end.

ource: Money Magazine 5/12/2008

Jumbo Mortgages

Executives from Fannie Mae and Freddie Mac are reducing interest rates on some jumbo mortgages. HSH Associates, said its surveys showed the rate for a 30-year fixed-rate mortgage of $417,000 or less was 6.17 percent. The average for loans between $417,000 and $729,750 was 6.61 Source: The Wall Street Journal percent, or 0.44 of a percentage point 5/23/0 higher.

Money Magazine
Rule 4: Don't buy cheap
By now you've heard from somebody who knows somebody who got a great deal on a foreclosed property. But when you buy a house, you're also buying into a neighborhood. And foreclosures tend to be bunched in areas where residents and speculators alike took out exotic mortgages to get into homes they subsequently found they couldn't afford. That's not a recipe for stability. Prices and quality of life could both decline further.

ource: Money Magazine 5/12/2008

urce: Seeking Alpha, Tom Iacono 4/28/08

Alan Greenspan
"We are having some liquidation now, it will accelerate, but it will not be until early 2009 that we will get close to having eliminated most of (the excess home inventory).”
- Alan Greenspan at Deutsche Bank conference in Singapore

Source: Dow Jones International News 5/14/08

Money Magazine
New rules for home sellers
Selling a home is a lot trickier than it used to be - here's how to be smart about pricing, presentation and incentives.

Rule 1: Get real about price
Too many sellers set their price based on yesterday's market. Big mistake. "The first buyers in tend to pay the best price, so you need to price it right at the start," says Pamela Liebman, CEO of the Corcoran Group brokerage. If a lot of homes like yours are on the market, then look to generate buzz, says Liebman. Set an asking price 10% below what homes like yours have been selling for. That raises the odds of your getting multiple offers. If your market is really frozen and you need to drop the price, make one large cut. No baby steps.

ource: Money Magazine 5/12/2008

Money Magazine
Rule 2: Vet your agent - especially if it's you
Selling on your own in an unprecedented slowdown means you'll have to work awfully hard marketing your home. If you aren't prepared for that, hire a broker. You want an agent who has been through good times and bad and who has a track record that you can verify with clients.

ource: Money Magazine 5/12/2008

urce: Seeking Alpha, Tom Iacono 5/20/08

urce: Seeking Alpha, Tom Iacono 5/20/08

Location

Sales

Fort Myers, Fla. Up 41% Las Vegas, Nev. Up 30% Prince William, Va. Sacramento, Calif. Up 62% Up 41%

Yahoo Finance
“I am predicting another 10%-15% downside, on average, for national home prices over the next 6-to-12 before any recover begins.”
-Professor Lawrence J. White, NYU's Stern School

Source: Yahoo Finance.com 5/19/08

http://money.cnn.com/2008/05/02/real_estate/gandel_your_next_house.moneymag/index.htm

ource: CNN Money.com 5/12/08

First American Core Logi

urce: First American Core Logic 1st Quarter 2008 Report

Washington Post

“Nationwide, from 2006 to 2007, the number of foreclosed properties listed at $1 million or more rose 50 percent according to RealtyTrac. And the number of foreclosed homes priced from $500,000 to $999,999 ource:jumped 88 percent.” Washington Post 5/15/08

Jack Trout
President, Trout & Partners Ltd.

Strategy
It is all about differentiati on.

Jack Trout
Researchers say every person is a mixture of characteristics. Being known for one characteristic makes the person unique. Albert Einstein: Intelligence Marilyn Monroe: Sexy

“Attribute” psychology.

Jack Trout
BMW Volvo Toyota Jaguar Ferrari driving Safety reliabili ty styling speed

Jack Trout
People are impressed with those who concentrate on a specific activity or product. They perceive them as “experts”, and tend to give them more knowledge and expertise than they sometimes deserve.

“Specialty” psychology.

Jack Trout
The three great sacrifices you must make: 1.) You can’t be everything to everybody. 2.) You can’t sell everything to everybody. 3.) You can’t keep changing what you are.

Bruce Zipf
President and CEO NRT

1.Surround yourself with great people 2.Prepare relentlessly 3.Hold yourself accountable 4.Develop strong beliefs 5.Be your own person 6.Negotiating is crucial!!

Pablo Sanchez
JP Morgan/Chase

• Business driven to FHA and GSE loans • 740-780 FICOs foreclosing at historical levels • Average loss on foreclosures $40,000 - $50,000 • Be savvy on FHAs ( 2% Q1 2007, 15% Q1 2008, • The perfect storm for investors
(rents up, rates down, prices down) 33% applications )

By Madeleine Romanello

Keeping Current Matters