Tuesday, June 15, 2010

RealtyJoin - New Social Media for Real Estate Investors...and FREE!

I am a member now, so please accept my invitation by clicking this link:


….and “friend” me (join my network on RealtyJoin.com)

RealtyJoin – A Free Tool to Help You Get More Business
Some of the leading real estate gurus in the country have teamed up with a group of the top software developers and Web designers in Silicon Valley and have just launched RealtyJoin, a social networking site for the real estate industry. RealtyJoin will make it easier for you to find great deals, opportunities, and vendors, and make more money…. and membership is free!

RealtyJoin is designed to help you all connect with deals and new clients. Think of RealtyJoin as Facebook for the real estate industry. How valuable would it be to you if everyone on Facebook could bring you deals and opportunities?

You may fall in one (or maybe two) of the 3 categories below:

RealtyJoin can help you:

• Find Deals and Partners
• Locate Financing Sources
• Find the Super Agents
• Find Great Vendors

RealtyJoin can help you:

• Find Investor Clients
• Increase your Profile within your Community
• Advertise your Properties (get your
own RealtyJoin page FOR FREE)
RealtyJoin can help you:

• Find new Clients
• Find new Partners
• Increase your profile in your community

RealtyJoin IS NOT a niche site designed for just networking and information. It is a site specifically designed for REAL ESTATE INVESTOR MATCHMAKING, and will help you all make more MONEY. All you need to do is register, create a profile, and start joining groups, and you will immediately learn about great people and opportunities.

Become a member today, and start using RealtyJoin to find deals and opportunities!


Thursday, June 10, 2010

Housing Bubble Yet to Burst?

The housing-market recession is not over
Why you shouldn't be overly optimistic about real estate right now

By Amy Hoak, MarketWatch

CHICAGO (MarketWatch) -- After years of hearing how home prices are plummeting and foreclosures are mounting, consumers want to feel hopeful about the housing market -- but maybe they're being too optimistic.

In a presentation to the National Association of Real Estate Editors in Austin, Texas, last week, Stan Humphries, Zillow.com's chief economist, pointed to four myths he said consumers are latching on to as they try to make sense of recent housing statistics.

The four myths:

1. The housing recession is over. It's not, Humphries said. He estimates the bottom in home prices won't come until the third quarter, at least from a national perspective. Doug Duncan, chief economist at Fannie Mae and also a speaker at the conference, agreed with that estimation.
2. After markets hit bottom, prices will rebound to boom levels. Not going to happen, at least for a while, Humphries said. "Once we hit bottom, the bottom is going to be a long and flat affair across the markets," he said. "What we're going to see once we hit bottom is the second phase of the housing recession... that second phase is one of being flat."
3. The worst of the foreclosure mess is behind us. More wishful thinking, according to Humphries. He estimates foreclosures will peak later this year, then remain elevated for a while. Rick Sharga, senior vice president of RealtyTrac, an online marketplace for foreclosure properties, said he doesn't envision foreclosure activity stabilizing until late 2011.
4. The tax credits saved the housing market. With or without a tax credit, those who bought would have done so anyway, Humphries said. "The biggest impact [in home sales] we believe were low prices... low interest rates and the unsung factor here is the ramped up lending by the Federal Housing Administration."

Still, it's easy to understand why many homeowners want look on the bright side.

"They went from what everyone thought was a lucrative asset to something worth a lot less than they owed on it," said Douglas Culkin, president of the National Apartment Association, in a phone interview. "We all want it to get better," he said.

Some want to finally sell their homes and move on with their plans. And homeowners are tired of thinking their houses are bleeding equity, losing value like a new car driving off the dealership lot.

As for prospective home buyers, even if consumers are feeling confident enough to take an extra trip to Wal-Mart these days, many are not going to jump in and spend on a large-ticket item like a house, said Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling.

"The reality of the situation in which we find ourselves today has sunk in with people," she said in a phone interview. "If a foreclosure hasn't been a part of their life, it has been a part of someone else's life... and they've seen the pain that inflicts on the family."

That perception isn't going to fade quickly.
It makes sense to be gloomy

Despite statistics showing some housing-market improvement, there's still good reason for pessimism.

The most recent Case-Shiller report showed prices rose 2.3% in March, compared with March 2009. The National Association of Realtors recently reported that in April the median existing home price rose 4% in the past year; existing home sales were up 7.6% in April to a seasonally adjusted annual rate of 5.77 million. Read about Case-Shiller's March home-price figures. See story on April sales of new and existing homes.

While it's too soon to quantify the degree of the effect, the deadline for the home-buyer tax credit likely played into the numbers. Contracts needed to be in place by April 30 to qualify, and some economists say that incentive made buyers move earlier than they would have otherwise. Any bump from a temporary credit is soon over.

But there is another important reason to take improving numbers with a grain of salt: What people are calling "shadow" inventory.

That's primarily inventory that banks are holding, homes that have been foreclosed on but haven't yet hit the market. There are also severely delinquent homeowners who haven't entered foreclosure yet, but who will eventually get there. Right now, many of them are trying to work out some sort of mortgage modification.

Then there's this: The group of "sidelined sellers," or people who want to sell their homes but have waited for the storms to pass, Humphries said. About 7% of homeowners -- representing more than 5 million homes -- fall into this category, and are very likely to try and sell their home in the next year if there are signs of improvement, according to Zillow estimates.

Additional inventory on the market slows any housing recovery.
Personal economies

Despite Humphries' theory that Americans are too optimistic on housing, there are plenty who still remain cautious. And if they're not looking at housing statistics with a skeptical eye, their personal economies are providing a reality check.

Most obviously, salaries for many Americans have been frozen or cut, and then there are the large numbers of people completely out of work, Culkin said.

According to a recent NFCC survey of more than 2,000 consumers, 49% said that if they were to attempt buying a home today they'd never be able to save enough money for a down payment. Coming up with a down payment has traditionally been problematic for first-time buyers, but it has spread to those who have owned before; many people are underwater in their mortgages, making it harder for them to get funds to move to another house.

Plus, today's buyers aren't only concerned about the ability to get a home but also their ability to keep it, said Duncan, of Fannie Mae. In the long run, that attitude is a good thing for the economy, he said.

"It's not just that we want a house," Duncan said, "but we will delay getting that house until we can afford to get it and afford to keep it."

Monday, May 3, 2010

Homeowner Mistakes...

Buying a home is the biggest purchase most people will ever make, yet many go into it blind. Here are the 6 most common -- and costly -- mistakes homebuyers make.
1. Not knowing your credit score
If you're even toying with the idea of buying a home, you must find out exactly what your FICO score is. If you find it is less than ideal, wage a systematic campaign to raise it. Too many borrowers ignore this step and get surprised when they get interest rate quotes.

Once you've pored over your credit history and corrected any errors, your next step is to pay down revolving debt balances to no more than 30% usage. That will help raise your score significantly.

Why does it matter?

The lower your score, the higher your costs of borrowing. Fannie Mae and Freddie Mac, for example, charge higher up-front fees to borrowers with credit scores below 740.

Learn How foreclosure impacts your credit score
Don’t Miss: Homebuilder stocks on fire
For a buyer with a credit score between 680 and 700, the fee comes to 1.5% of the mortgage principal. On a $200,000 mortgage, that adds up to $3,000. Someone with a 740 score pays nothing.

Lower-score borrowers also get saddled with higher interest rates, about 0.4 percentage point more for the below 700 borrower. That costs an extra $62 a month -- $744 a year -- on a $200,000, 30-year, fixed rate loan.

2. Buying a car before a house
Anytime consumers open new credit accounts -- credit card, auto loan, etc. -- their FICO score could drop, according to Craig Watts, a spokesman for Fair Isaac, the creator of FICO scores.

"Hence the admonition to not open other new accounts while your mortgage application is in process," he said.

A big purchase would use up a considerable proportion of a borrower's total credit limit, which results in a drop in the score. Lenders often continue to check credit scores in the weeks before closing.

"The lender will likely slam on the brakes if the applicant's credit scores have suddenly dropped below the minimum required for the requested loan rate," Watts said.

3. Skimping on home inspection
Buying a pig in a poke can cost buyers big bucks -- just when they can least afford it. So It's vital to find all the costly flaws before you buy.

Many homes on the market today are distressed properties -- foreclosures and short sales -- and that only increases the importance of good inspections, according to David Tamny, president of the American Society of Home Inspectors.

"The owners usually didn't have the money to keep up these homes," he said. "There's a lot of deferred maintenance."

A home inspection can find problems with the foundation, electrical, plumbing, roof, attic insulation, and heating and air conditioning. In some states, separate licensed inspectors offer mold or termite inspections.

Often homebuyers, who may be strapped for cash, stint on inspections and look for the cheapest way to go. That can lead to disaster.

"The cost of repairs far exceeds the cost of inspection," said Tamny.

4. No lawyer
Nearly everyone involved in a real estate transaction -- the seller, the buyer's real estate agent, the seller's agent and the mortgage broker -- has a vested interest in getting the deal done because they only get paid when the house is sold. So they may push a deal even if it's not in the best interest of the buyer.

One of the best defenses against making am expensive purchase you'll regret is to hire a real estate attorney -- even in cities where it's not standard practice. These professionals charge flat fees and their advice is objective.

It's nice to have someone on your side.

5. No contingencies
When signing a sales contract, buyers usually have to put up 1% to 3% in "earnest money," which they don't get back if they pull out of the deal except under certain conditions spelled out in the contract.

Sellers try to limit the grounds for canceling, and inexperienced buyers may sign contracts that don't include common exceptions, such as uncovering major problems during the home inspection, failing to obtain financing and failure of the house to appraise.

Failure to obtain financing is common these days because lenders have become very picky; underwriting is very strict.

Even if your mortgage company is still willing to finance your purchase, the house itself may be worth less than you've contracted to pay for it, and the lender will pull its approval.

With residential real estate markets still slow, sellers usually accept contingency clauses, but if they resist, it may be better to rethink the deal. Losing a deposit of $2,000 to $6,000 on a $200,000 home hurts.

6. Not budgeting for insurance
Don't underestimate insurance costs and fail to budget for them.

Many homebuyers don't understand just what is -- and what is not -- covered. Standard policies pay for theft and wind, fire, lightning, hail and explosion damage. Not covered is flooding, earthquake damage or problems caused by neglect of routine maintenance, according to Jeanne Salvatore, spokeswoman for the Insurance Information Institute, an industry-sponsored educational group.

"The most important thing is before you buy a home, find out what it will cost to insure it," she said. "Insurance needs to be calculated into the cost of owning a home. Unlike a mortgage, which you can pay off, you'll be responsible for the insurance costs forever."

For flood insurance, most buyers use the National Flood Insurance Program. Earthquake coverage may be available through a state authority or some private companies.

Depending on location, flood insurance can run into a lot of money. The cost of $250,000 worth of government flood coverage on the building and $100,000 of its contents can go as high as $5,714 in high-risk, coastal areas.

Apr 20th, 2010

Monday, April 12, 2010

When NOT to File a Claim!

The Basics
When NOT to file a claim

Some insurers are dumping consumers who file too many or the wrong type of claims. Here are four scenarios when you should pay out of pocket.
By Liz Pulliam Weston

You've just crunched your fender in a parking lot. Or your washing machine overflowed, flooding your laundry room. Should you call your insurer?

Probably not.

These days, insurance companies are quicker to raise premiums or drop coverage entirely when customers make too many claims -- or just one of the wrong kind of claim. Some people have even found themselves without coverage after simply consulting with their agent over whether or not to file a claim.

Unfortunately, there's no cut-and-dried formula for determining when to involve your insurance company and when to keep your problems to yourself. The following are some situations where you should at least think twice before picking up the phone:
The damage is under $1,000
Here's a basic fact about insurance: It's meant to cover the big disasters that could cripple you financially, not small stuff that just stings a bit.

With that in mind, smart consumers have long kept their home and auto premium costs down by raising their deductibles to $500, $1,000 or higher and not making claims unless the damage exceeds that limit. These days, such an approach can not only save money, it can also save your coverage. In some cases, it may be better to raid your emergency fund or use a credit card than to risk higher premiums or not having your policy renewed.

This is true even if your state or insurer provides some protection for consumers. While some insurers, including State Farm and USAA, "forgive" longtime customers by not counting the first at-fault accident, the real problem with filing a small claim is that it can count against you if you ever need to file a bigger claim later.
No (bodily) harm, no foul
Most accidents don't involve injuries. If you're in a one-car mishap or you hit an unoccupied vehicle, you might consider paying for the damage yourself if you can afford the tab. Especially if your driving history is less than pristine -- you've already had an accident or ticket in the last three years -- paying for an accident out-of-pocket may be cheaper than facing the higher premiums that are likely to result.

Not telling your insurance company about an accident you've caused is a risky maneuver, however, if another driver was involved, there were injuries, or you had a passenger. While you're legally not required to make an insurance claim, you probably should notify your insurer of what happened if there's a chance someone else could make a claim on your policy. Insurers don't like to be surprised, and you'll want to have your version of events on the record. In a worst-case scenario, your company could use your failure to report the accident as a reason not to pay your defense costs if you are sued.

Video: Is high deductible health insurance a smart move?

Your insurer also may find out about the accident if your state or local laws require a police report be filed. (Such reports are usually mandatory if injuries or significant property damage is involved.) Most insurers comb Department of Motor Vehicle records looking for unreported incidents. You can find out if a police report is required by calling your local law enforcement agency.

Continued: If the damage involves water or mold

The damage involves water or mold
Insurers are seriously spooked by a rising number of water damage and mold claims in several states. Consumers who make water damage claims risk losing their coverage, and may even find their homes blackballed, meaning that coverage is unavailable at any price.

That's because insurers are trying to steer clear of "problem" properties, using a central database known as the Comprehensive Loss Underwriting Exchange or CLUE. Nearly all insurers share claims information through CLUE, and they use the information in the database to decide whether or not to insure a home. Some companies are so sensitive about mold losses that even a single water damage claim on a house is enough for them to refuse coverage.

That does more than make it tough to buy a policy. It can also be a red flag for future buyers. If they have trouble getting a policy because of past claims, you may have a tough time selling your home.
The damage resulted from your neglect
You open your front door, step into your home -- and the floor collapses underneath your feet, thanks to termite damage.

This might seem the perfect time to use your insurance. But homeowners policies specifically exclude problems that result from pest infestations, rot and other indications that you've failed to properly maintain your home.

The insurer's viewpoint is that you should have detected the termites and had them exterminated long before they could eat through the structure of your home. Likewise, long-term damage from leaking roofs and faucets is usually considered preventable and not covered.

Video: Is high deductible health insurance a smart move?

You're also on the hook if you make a bad problem worse. If a windstorm blows off part of your roof and you leave the hole uncovered, you might lose coverage for contents that were exposed to further damage.

All this doesn't mean you can never use your insurance coverage. But using prudently, especially these days, will ensure it's there when you really need.

Liz Pulliam Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "Your Credit Score: Your Money & What's at Stake." Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. She also answers reader questions on the Your Money message board and helps middle-class families cope at Building a Brighter Future.

Updated Nov. 4, 2009

Saturday, April 3, 2010

Commercial Mortgage Bust?

What Happened to the Commercial Real Estate Collapse Everyone Expected?
Posted Apr 01, 2010 03:30pm EDT by Heesun Wee in Investing, Recession, Banking, Housing

There's a growing suspicion among investors that the gulf between the soaring stock market and sideways action in housing can't go on much longer. Housing expert, notably Robert Shiller of Yale University, a Tech Ticker guest, is warning about the possibility of a double-dip in housing.

But another potential real-estate crisis is looming -- this time in the commercial sector. About half of all commercial mortgages will be underwater by the end of 2010, posing a "very serious problem" for the economy over the next three years, Elizabeth Warren, chairwoman of the TARP Congressional Oversight Panel, told CNBC this week.

So why hasn't commercial real estate collapsed yet?

In part the sector has been able to access the unsecured bond markets, says our guest Jeung Hyun, portfolio manager for Adelante Capital, which has over $2 billion of domestic REITs under management. "Clearly there's lending still available for these companies that's allowed them to survive," Hyun tells Aaron and Henry in the accompanying clip.

Another trend that's helping commercial real estate -- few, new office space buildings. "To a certain extent people are assuming that the recovery is going to be sharper than normal" because of the lower inventory, Hyun says.

Are banks extending credit & pretending?

Hold on. Clearly there are whispers and anecdotes of excess inventory and even "shadow" inventory. In other words, banks that are extending credit and hoping all will be OK by the time the loans come due.

Hyun argues there's clarity in details. More stand-alone retailers have been built than regional malls. And without a doubt, there's concern about the wave of secured mortgages coming due. Plus, the Fed this week ended its program of buying mortgage-backed and agency securities. Can housing stand on its own two feet?

But Hyun argues not all mortgages will be problematic. Some were inked -- well before the height of the housing bubble in 2007-08 -- when underwriting standards were still high.

Thursday, February 25, 2010

Another great piece by Karen Decoster...