Foreclosures: When Perception Is Not Reality

Today’s blog post is brought to you by two great powers: Richard C. Oliver and Wiley Miller.

One created the inspiration, and one brought the inspiration to my attention. So let me share with you Wiley’s (he prefers being addressed as such) genius before we go on:

Now let’s talk about why this is wrong.

We’re Building the Future

Hopefully the country is following suit, but as for us here in San Antonio, Texas, we’re not building houses and waiting for people to come love them and buy them. New home development has historically been slow and thoughtful here in the Alamo City, and we like it that way. When it did boom (ahem Stone Oak area, I’m talking about you) we realized our infrastructure was lacking and began quickly taking measures to ensure that folks had access to fire, EMS, and police services, and we’re upgrading those roads to get everyone in and out quickly. It’s more than a matter of supply and demand, it’s what makes sense.

We’re putting up houses with a purpose. Shelter is a basic human need, but it seems like all people really care about is money these days. With new lending restrictions the FHA and banks in general are making sure that when people need money to buy a house, that they’re not getting in over their heads. If it works the way it should, we should see fewer foreclosures and a return to the “good ol’ days.”

2011 is Mistakenly Called the Peak

I think calling this the peak is fine if you’re plotting the foreclosure rate on a graph, but I’m going to call this the trough, and I hope I don’t come off as a pessimist. But the truth is foreclosure isn’t a good thing, and calling it “a peak” makes it seem that way.

It’s going to get worse before it gets better. This January 13 article by Janna Herron of the AP states that “about 5 million borrowers are at least two months behind on their mortgages,” and until the job market picks up and unemployment goes down, we may not see much of a change.

The Rest Can Only go up from Here, but We’ll Do What we Want

The saying goes “Once you’ve hit rock bottom, the only way is up.” San Antonio hasn’t been hit nearly as badly as the rest of the nation. Our median home sales price has stayed right around $150,000 for more than a few years now, meaning value hasn’t changed much and prices haven’t sunk like they have in Florida, Michigan, Nevada, and California.

As a matter of fact, three major San Antonio areas saw slight upticks in sales prices in 2010, and we’re hoping to keep them that way. This article by San Antonio Express-News writer Jennifer Hiller details those areas and recounts the SABOR 2011 Housing Forecast put on by the San Antonio Board of Realtors (SABOR).

Is there Good News?

There always is. I always look for silver lining, even on the darkest clouds. Unfortunately this silver lining comes at a high cost to some.

With interest rates as low as they are, and an influx of foreclosures on the market (or coming onto the market), we’ll see a spike in investor purchasing. Getting the money is just as difficult, if not more difficult, than in previous years, but please don’t think that that will stop investors from doing everything they can to get their hands on homes ripe for the picking.

A future benefit of current investor purchases: while investors are buying up houses on the cheap, they’re planning on fixing and flipping them. They may not sell these houses for top dollar in the future, but they’re sure to make money on the transaction, and hopefully the next buyer will get a house that’s been revamped and is ready for an owner-occupant to live and love it.

The way it used to be, the way it should be.

Danny Charbel is a Keller Williams Realtor in San Antonio, Texas. Please contact him with any questions, comments, concerns, keep the spam to a minimum, bring on the jokes, interesting banter, comical retorts, and insightful inquiries. You can email him at dcharbel [at] kw [dot] com, or follow him on Twitter @dannycharbel.

Twenty year Re/Max veteran and top producer leaves, joins Keller Williams Realty

Every now and again I like to brag on the wonderful company I work with. Here’s an article just released yesterday from Keller Williams Realty’s international headquarters in Austin, Texas. Enjoy!

Top Ranked Franchisee Joins Keller Williams Realty

Joe Rothchild to lead Keller Williams Signature in Houston, Texas

AUSTIN, TEXAS (April 12, 2010) — Keller Williams® Realty Inc. announced today that Joe Rothchild, formerly a top ranked Re/Max franchisee and the leader of Houston’s #1 selling real estate team in dollar volume and number of closed transactions in 2009 (Houston Business Journal, March 2010), is now at the helm of the Keller Williams Signature office in Houston, Texas. The Joe Rothchild Team closed 779 transactions for $155 million in volume last year.

“Keller Williams Realty has shown that their model can adapt to any market, which was one of the driving forces in my decision,” said Rothchild, who has left Re/Max after 20 years as a franchisee. “I have been researching and contemplating for more than two years, and I discovered that I needed to reinvent my business to revitalize it. We were implementing some of the same philosophies and mirroring the Keller Williams system, so finally, one day we said…why reinvent the wheel? And, the answer was clear.”

Rothchild added, “KW’s philosophy of putting agents and ownership on the same side of the table and training on the most critical issues facing us in today’s market were also incredibly important to us.”

“We are thrilled to be in business with a talent like Joe. For the last 15 years, Joe has been one of the top 10 teams in Re/Max, and was number one worldwide for three years in a row! When a top franchisee from one of our competitors chooses to join us, we consider it a true honor and confirmation that we have unbelievable momentum behind our growth,” said Mark Willis, CEO of Keller Williams Realty.

Many of Rothchild’s current associates will be joining him at the Keller Williams Signature office. Among them, Dale Ross, an industry veteran with 29-years of experience under his belt, 25 of which have been with Re/Max. “When I factored in the Keller Williams Realty systems, training and support, and realized it was the place I needed to be,” said Ross.

This announcement comes on the heels of a year of positive growth for Keller Williams Realty throughout the U.S. and Canada. The company outpaced the downward trend in the real estate market and grew in every category – opening 30 new franchises, ending the year with a 16 percent year-over-year increase in the number of contracts closed per agent and more than 76,879 associates across North America (up three percent). In addition, the company gave back more than $32.2 million in profit share to its agents.

In addition to recently becoming the 3rd largest real estate company in the U.S., surpassing Re/Max, according to Steve Murray at REAL Trends, Keller Williams Realty received the highest overall satisfaction ratings from home buyers among the largest full-service real estate firms from J.D. Power and Associates for the second year in a row, and was ranked as the No. 1 real estate franchise on the 31st Annual Franchise 500 list by Entrepreneur magazine.

Questions? Comments? Concerns? Wondering why you’re paying so much money to your broker and are still not part of the 3rd largest real estate company in the United States? Wondering what Keller Williams has to offer? Give me a call! Email me at dcharbel [at] kw [dot] com and let’s chat! You can also follow me on Twitter, I’m @dannycharbel. See you at the top!

Free Stuff Free Speech Friday: Deals, Friday the 13th, and real estate

What’s that you say? You need an LCD alarm clock with a calendar display that can hold pens? Great! How about $3.99 with free (yes free) shipping? Click here!

What’s up with Friday the 13th anyway? Wikipedia sheds some light on the subject:
Article about Friday the 13th.
Article about the fear of the number 13.

Okay okay, back to some real estate stuff.
Remember that thing called DTI or debt to income (it’s a ratio)? Well here’s an article from my friends at RIS Media about what homeowners need to know about debt to income ratios. Click here.

Questions? Comments? Concerns? Rebuttals? Rebukes? Remarks? Email me directly at dcharbel [at] kw [dot] com.

Wild West Wednesday: Employment, elections, etc.

Wild West Wednesdays are all about what’s going on in San Antonio and the rest of Texas in what used to be the Wild West. Now that it’s been won, all I need to do is show you how great things are out here. Enjoy! -dc

ACS (Affiliated Computer Services, Inc.) is slated to employ 500 people in San Antonio. Click here for the full article.

AAA Texas is also hiring in Texas (Dallas, Amarillo, El Paso, Houston and San Antonio). Click here for the full article.

Solar energy company Vote Solar Initiative has reportedly taken ads in newspapers throughout the state claiming that “solar energy could create 45,000 to 90,000 jobs across the state for electricians and engineers and in sales.” Click here for the full article.

May 9, 2009 is San Antonio’s city elections. Click here to see the candidates running for the office.

Questions? Comments? Concerns? Got a news source you’d like to show up here next Wednesday? Do you have fun free stuff for Friday’s post? Got any suggestions for next Money Monday or Timing Tuesday? Email me at dcharbel [at] kw [dot] com.

Mind Your Money Mondays-Carpet, painting, and other fixes

We’ve found the house we want, but the carpet (and other flooring, the paint, the stair rail and banister) is ugly. It’s beaten down, stained with who-knows-what, and just really needs to be taken out. What can my Realtor® do to help us out in this situation?
I’m glad you’re minding your money! Let’s talk about a few options when it comes to this kind of action:

1. DIY

Yeah, that’s right. Do it yourself. So your agent would write it into the offer and you’d get a check for the cost of the work. You may even ask that your agent require certified funds or cash after closing. You never know if the seller’s check is going to bounce, and that’s one less thing you’d have to deal with when buying a new home.

2. Let the Seller do it

When you’re putting the offer together ask your agent to make sure that the seller of the home understands that they will be expected to replace (with similar kinda and quality) those things that you’d expect to have changed before you move into the house.

3. Take it off!

Go ahead and get your agent to take the asking price of the house, get some estimates on the work you’d like done to the house, and then subtract the amount(s) from the asking price, and submit the offer.

 There’s no tried-and-true method, it’s always up to you, the buyer. Make sure your agent knows your preferred method and run with it. You never know what you’re going to be able to talk someone into.

Questions? Comments? Concerns? Ready to make an offer? Looking for a fixer-upper? Email me at dcharbel [at] kw [dot] com.

Buyer’s Series – Does the Stimulus Package help me?

I’m planning on buying a house, but I don’t know if I should buy it now or later, what’s the main strategy these days? I know a few of my friends are saying I should do it quick in order to get the Stimulus Package benefit. Help!

First of all, calm down. You don’t have to buy it today or tomorrow (or yesterday) in order to benefit from the current market. It’s a buyer’s market, it’s been one for a while, so you’re in good shape.

As I understand it, with all income limits considered and whatnot, first time homebuyers will qualify for UP TO $8,000 tax credit (not deduction). What determines the total amount of your credit is the total price of the house. The credit will go toward 10% of the price of the house.

There are also income limits, so read the new bill carefully (if you’re single it’s one thing, if you’re married is another). My best suggestion is to talk to your favorite mortgage lender about it.

Finally, it’s great to realize that it’s a credit and not a deduction. Meaning the money comes right off your tax liability. Pretty cool if you owe Uncle Sam a lot next year.

Questions? Comments? Want to talk more about the bill? Email me at dcharbel [at] kw [dot] com.

General Post: At least we’re not in California

Tip: When you see the headline “General Post” I’d appreciate if you saluted your computer screen as though General Post just walked into your barracks. Enjoy!

Word on the financial “streets” is that California has frozen … well, everything!
Los Angeles County freezes hiring
State freezes on-campus construction
Furloughs in California Close Many State Offices

So what’s going on in Texas?
San Antonio Ranked as one of Hottest Regions
Foreclosure postings halt climb in Bexar
San Antonio Car manufacturer Toyota unveils Tundra changes at Chicago Auto Show
Countrywide customers might get restitution
Frost Insurance inks lease deal off 1604
WellMed partners with health clinics
Rackspace adds data center capacity

What’s the point?
It’s getting good.
If you’re here, great!
If you’re not, get here. Email me, call me, send me smoke signals, a messenger pigeon, or a telegraph of some sort and I’ll make sure you know how to get here.

Questions? Comments? Concerns? Curiosity? Email me at dcharbel [at] kw [dot] com.

Buyer’s Series – Can I use my agent to buy a new home?

I’ve been using an agent to show me houses all over the city. The other day while driving, though, I saw a neighborhood that was still being built and I stopped in to see what was going on. I liked the neighborhood a lot, and decided to talk to a salesperson about what the homes would cost. Everything was going great, but then she asked me “Are you working with a Realtor?” What should I have done?

It’s like your mom always told you: honesty is the best policy. Are you working with a Realtor®? Sounds to me like you are. You may not be a client of his or hers, but you were surely working with a Realtor. so what should you have done? The answer’s easy, say “yes” and provide the salesperson with your agent’s information.

Here’s the thing. You could have said “no” and just gone on your merry way. But what happens when you want to come to sell that house, especially if you know the Realtor personally or you got along well with him or her? Plus, let’s face it, the agent did show you a few houses, did some homework on your behalf, and provided service to the best of their abilities, right? Putting your agent’s name on that contract when you’re buying a new home says “thanks” for all that, and keeps you in great standing with him or her.

My advice? Take your agent with you every time you go out to see houses, especially new homes. It makes the process so much smoother and simpler. Plus, your agent has tools to help you in your search and may even be able to provide you with information about neighborhoods you didn’t know were even going up yet!

Have fun, and good luck with your new home. Your Realtor must be very proud.

Questions? Comments? Concerns? Interjections? Rebuttals? Rebukes? Stipulations? Did you notice that all those are in alphabetical order? Want to call me out on it? Email me at dcharbel [at] kw [dot] com.

Y’all come back now, y’hear?

The Fort Worth Business Press has published an interesting article this morning detailing the reasons (one in particular) that particularly affluent people may consider moving to Texas.

The article, titled “Gone To Texas Troubled borrowers seek Lone Star relief,” examines the forgiveness Texas has toward folks looking bankruptcy in the eye.

The article quotes Jim Gaines, a research economist at Texas A & M’s Real Estate Center as saying “It may not work for everyone, but if you have a lot of money and even more debt and you are trying to beat the clock before all your troubles catch up to you, then Texas may be your Holy Land.”

An example? Well in many other states lenders can sue debtors for the price difference between what was owed on their mortgage and what the lender was able to sell the house for after foreclosure. The method of payment? They garnish your wages of course. Unless you live in Texas. Turns out we don’t like that much here, so we won’t allow it. Oh, and we won’t let them touch your alimony or your child support payments either. Do I hear a bunch of Californians hollerin’ “yee-haw?”

I strongly suggest you read the article, it lays out a few very interesting points. Including:

-How and why home lenders can’t seize your car (but your car note lender can);
-How much property can be exempt if you live within city limits;
-How much property (and a strategy to protect the rest) can be exempt if you live in a rural area;
-For those of us who still value our IRA and 401K accounts, you can thank Texas for safeguarding them;
-And of course, ways to stay out of court.

Be careful though. These exemptions and loopholes are really in place to help the cash-rich, those people with a lot of money and a lot to lose. Also, hopefully you’ve got a way to show residency in Texas for the past two years, or a way to hang on for the next two years while you establish residency here. Turns out all 50 states have a rule about claiming these exemptions: you have to be a resident of the state.

Questions? Comments? Concerns? Ready to mosey on down to the great Lone Star State? Email me at dcharbel [at] kw [dot] com. I’ll be happy to wrastle up some grub and welcome you to the Alamo City.

Seller’s Series – Inexpensive quick fixes

I’m taking a break from our regular programming to learn. Yes, I’m in a class. So, that being said, every Thursday’s blog post for the next 11 weeks will stray from the “norm.” -danny

http://www.realtor.org/rmohome_and_design/articles/2009/0902_househome_lowcostideas

This is a great article on quick (and inexpensive) things you can do to help make your house look better when you’re ready to sell.

Hey, this even helps when you’re having a dinner party!

-danny