It can be said, with confidence, that 2008 was a bad year for real estate in in the MD Suburbs of DC.  Although we tend to be more “recession proof” than a lot of the other areas of the country - mainly due to the presence of the Federal Government and the military - we have still had our fair share of foreclosures and short sales.

Prices have declined, it takes longer to sell homes even when the Seller has plenty of equity in their home and is willing to fix it up and “pretty it up” for the home sale.  Slowly but surely, I think we are beginning to see some stabilization.  However, I still think we are in for a rough patch.

I’m guardedly optimistic about 2009.  More to the point, I am not going anywhere.  I am committed to remaining in the real estate profession - full time - to serve the home buyers and home sellers in the northern Prince George’s County and southern Montgomery County area.

So break out the noise makers, the party hats and the champagne!  Welcome 2009!

In any real estate transaction there are many occasions where one person or the other can be confused or uncertain about what is needed.  There is lots and lots of stuff going on - home inspections, appraisals, loan applications, underwriting, title search - and if there is a mistake in any one of those areas it can cause the whole train to come to a screeching halt.

During the “plain vanilla” type real estate sales the inspection is a place for things to get bollixed up.  The Seller and the Listing Agent are rarely at the home inspection since the idea is to give the Buyer and his home inspector free reign to do a thorough inspection.  So it is really up to the Buyer’s Agent to be very clear when writing out the Inspection Addendum which will list the items the Buyer is requesting be fixed.  That way when the Seller and the Listing Agent sit down together to go over the repair items there is no question about what the Buyer wants completed.

When Communication Breaks Down

If the written word isn’t clear and the Buyer’s Agent is unsure of how to describe one item or another it is left to the imagination of the Seller and Listing Agent as to what needs to happen. Of course, this can be clarified by the Buyer directly during the pre-settlement walk-through.  By then, it’s almost too late to do anything so there is lots of running around, perhaps a repair escrow, perhaps an additional credit to the Buyer.  None of it is any good.

So it’s important to get the information needed in a clear and unmistakable way so things happen when they’re supposed to happen and everyone is happy when they sit at the settlement table together.

A good Realtor with experience and knowledge of the Contract of Sale can really help by making things clear and communicating them well to other relevant parties to the process.  If you want to know more about the real estate process, shoot me an e-mail or give me a call.

Can you believe it?  I’m actually typing into my Blog on Christmas morning waiting for my wife to arise so we can open our Christmas morning  presents together!  Who would have thought technology would have become such an integral part of my life?

Merry Christmas from the Blog (hey, let’s be real! it’s actually, me, Ken, saying it) and a very joyous Holiday Season!

Dear Santa,

2008 has been a tough year on all of us - home buyers, home sellers and all the real estate professionals involved in the sale of residential real estate: Realtors, lenders, home inspectors, appraisers, title companies, home improvement contractors and the many people - real human beings - that work at all these places.  It would be real nice if you could arrange for a 2009 that’s a little easier on everyone.

The List

• Equilibrium - this is where there are about the same number of houses for sale as there are home buyers who want to purchase a house.  This works well for everyone.  Home buyers still have a great choice of homes without having to get into bidding wars, they can still do inspections and get repairs completed and prices will be reasonable.  Home sellers won’t have to worry about waiting a year while their house sits on the market and, most importantly, the house will sell so they can move onto the next chapter in their lives.
• Low Mortgage Interest Rates - this will help people who want to buy homes and it will help people who own homes. Low mortgage interest rates will help keep monthly payments reasonable and affordable for new home buyers.  They will also help all those folks who bought a house years ago with those fancy Adjustable Rate Mortgages (ARMs). If rates stay low, their rate won’t go up (it may even go down) and they’ll be able to stay in their home and help with that equilibrium thing.
• Credit Standards That Work - No, Santa, I don’t want to go back to the day when anyone who could fog a mirror could get a mortgage.  That was way too liberal.  It would be nice, though, if requirements needed to get a mortgage were a little bit more relaxed. Right now, it’s almost impossible for self-employed people or even the affluent to get mortgages because of all the documentation requirements.  There are lots of people that may have credit scores in the high 600s that will probably pay the loan back like clockwork.  Appraisers need some leeway to consider the glut of foreclosures and short sales that are artificially depressing the market.  Santa, let’s just lighten up a little bit.
• Civility - I know that this is the tough one, Santa. It’s sort of on the order of “world peace”.  Home sellers want the absolute most they can get and home buyers want to pay the absolute least they can pay.  That’s OK.  But do we have to be so mean about it?  If home buyers get a good price do they also need to nit pick every crack and tear in the house?  Do Realtors have to scream or make threats about “walking away” in order to transfer real estate from seller to buyer? It’s alright with me that people stand firm on what’s important to them.  We should be able to negotiate in good faith and with an even temper so that everyone comes out feeling good about the process and the end result.

So, there you have it, Santa.  It’s not a long list.  You don’t even have to deliver it all on Christmas Day. Sprinkle it on throughout the year.  Keep it in mind, though, Santa. Pretty please.

As 2009 approaches I’ve been looking into my crystal ball to see what might be coming down the pike.  Here are my predictions:

1. The FHA down payment requirement increases from 3% to 3.5% decreasing the already small pool of moderate income home buyers in the market.
2. The $7,500 first time home buyers tax credit will become permanent and become a real tax credit - not the faux credit it is now.
3. Mortgage interest rates for 30 year fixed mortgage will drop to about 4.5% - give or take a ¼%.
4. Qualifying for a mortgage will still be difficult for moderate income folks with strict documentation requirements holding in place.
5. Banks will begin to work faster to allow “short sales” to actually sell since it will take lots longer to actually foreclose on a house and they’ll be losing money anyway.
6. As “short sales” and bank owned foreclosures sell, the housing stock will get smaller and prices will stabilize.
7. The media will begin to “talk up” the price stabilization story causing home buyers with pent-up demand to come into the market to buy houses.
8. The Obama Administration people will want to buy houses because they see a “good deal” but will need homes in “move-in” condition since they won’t have time to mess around with repairs or renovation.
9. BRAC (Base Realignment Commission) movement will start in 2009 and help the area around Ft. Meade. Bank owned and “plain vanilla” sales will be key.  These folks won’t have the time to wait for short sales to work through the process. Price will be king. Fixer uppers will be OK.
10. Finally, 2009 will be the last “down” year. By 2010 home prices will have bottomed, the number of homes on the market will be smaller and people will have been saving their pennies for the down payment needed to buy a house.  Rent prices and monthly mortgage payments will be roughly equivalent making home ownership attractive.

So there you have it.  My top ten for 2009. It’ll be interesting to look back at this in a year to see how right (or wrong) I am.

Discipline is a tough word.  It brings back memories of all kinds of unpleasant things from childhood, school, and even work. When it comes to purchasing a home or even preparing to sell your home, I like this definition:

“Activity, exercise, or a regimen that develops or improves a skill; training: A daily stint at the typewriter is excellent discipline for a writer.”

discipline. Dictionary.com. Dictionary.com Unabridged (v 1.1). Random House, Inc. http://dictionary.reference.com/browse/discipline (accessed: November 29, 2008)

You see the rules for buying a home or selling a home have changed.  It used to be very easy on both sides.  For Buyers, mortgages were easy to come by and for Sellers there were lots of Buyers with a contract in hand.

Keeping Your Eyes On The Prize

In today’s market it’s important to keep your objective in front of you.  What do you really want?

If you’re a Buyer in today’s market you may have to save some money for a down payment, clean up your credit, pay off some bills even if you have great credit, assemble and maintain documentation that proves you can afford to pay a mortgage for the type of home you would like to live in. It means save, save, save.

If you’re a Seller and you really want to sell your home to move on to the next part of your life you may have to suck it up and offer your home at a price lower than you’d like, you’ll have to make repairs, you’ll need to work with potential Buyers to help with their closing costs (maybe), and you’ll have to keep you house in pristine condition - make the beds, do the dishes vacuum the carpets, mow the lawn.

Keep your eyes on the prize.  Maintain discipline.

Not As Easy As It Looks

A few years after I got into real estate, the Seller’s Market started to take off. All of a sudden hundreds, thousands of people got their real estate license and started to sell real estate.  When the market changed and things didn’t happen quite as fast as before these same people left the real estate profession.

They didn’t have the discipline to do the things that need to be done in order to make a living in the profession.  As a result they couldn’t look their clients in the eye to tell them they needed to clean up the bedroom and keep it clean in order to sell their home or they needed to save $20,000 in order to buy a home.

It’s tough out there.  Yes. There is mortgage money for homes…and you don’t even need perfect credit and you only need about 3% for a down payment. That’s still pretty darn good especially with rates down int the 5.5% range.  Yes. There are qualified Buyers that will buy a home but if you’re selling you may been to make some serious concessions.

Remember.  A little discipline will get you where you want to go.

Even in the midst of economic turmoil, terrorism in India and strife around the world today gives us pause to remember the good things both large and small for which to be thankful:

• our health
• our home
• our family
• our friends
• our religious community
• our neighbors

… and that’s just to get us started.

The Presidential Proclamation

Proclamation of National Thanksgiving
George Washington
City of New York, October 3, 1789

Whereas it is the duty of all Nations to acknowledge the providence of Almighty God, to obey his will, to be grateful for his benefits, and humbly to implore his protection and favor, and whereas both Houses of Congress have by their joint Committee requested me “to recommend to the People of the United States a day of public thanksgiving and prayer to be observed by acknowledging with grateful hearts the many signal favors of Almighty God especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness.”

Now therefore I do recommend and assign Thursday the 26th day of November next to be devoted by the People of these States to the service of that great and glorious Being, who is the beneficent Author of all the good that was, that is, or that will be. That we may then all unite in rendering unto him our sincere and humble thanks, for his kind care and protection of the People of this Country previous to their becoming a Nation, for the signal and manifold mercies, and the favorable interpositions of his providence, which we experienced in the course and conclusion of the late war, for the great degree of tranquility, union, and plenty, which we have since enjoyed, for the peaceable and rational manner, in which we have been enabled to establish constitutions of government for our safety and happiness, and particularly the national One now lately instituted, for the civil and religious liberty with which we are blessed; and the means we have of acquiring and diffusing useful knowledge; and in general for all the great and various favors which he hath been pleased to confer upon us.

And also that we may then unite in most humbly offering our prayers and supplications to the great Lord and Ruler of Nations and beseech him to pardon our national and other transgressions, to enable us all, whether in public or private stations, to perform our several and relative duties properly and punctually, to render our national government a blessing to all the people, by constantly being a Government of wise, just, and constitutional laws, discreetly and faithfully executed and obeyed, to protect and guide all Sovereigns and Nations (especially such as have shown kindness unto us) and to bless them with good government, peace, and concord. To promote the knowledge and practice of true religion and virtue, and the encrease of science among them and Us, and generally to grant unto all Mankind such a degree of temporal prosperity as he alone knows to be best.

Given under my hand at the City of New York the third day of October in the year of our Lord 1789.

Thank You To My Readers And Clients

A special thank you from me to you - my readers and clients - for being supportive, kind and generous.  Enjoy your day of Thanksgiving…and make sure to leave room for dessert!

Today I was listening to my favorite radio station - WAMU, 88.5 FM - a great NPR affiliate station in the MD Suburbs of DC.  It was late afternoon and All Things Considered was on the air.  ATC, as I lovingly refer to it, has a new segment called All Tech Considered aired on Monday evenings.

To be honest, I wasn’t really listening that closely until the end when the on air talent/personality (Sorry.  I remember a woman’s voice but can’t remember who it was.) invited listeners to come to their website and join their group and discussion boards and there was even a place to send “old fashioned e-mail”.

It may just be me but, geeze, is e-mail really considered “old fashioned” already?

In another historic first, President-Elect Barack Obama has taken the traditional Saturday “radio” address and made it into a Web based video.  Now, instead of hunting for a radio station that might air the short, weekly address you can view it on the Web…anytime.

This is the website where you can find future news.  I love the domain name: Change.gov.  It kinda says it all.

I won’t be adding this every Saturday but I thought it was important enough and historic enough to add today.  It’s just a little over three and a half minutes long.

In the urban and suburban madness we call daily living aith all the stresses and strains, it’s nice to be able to find an oasis of comfort and relaxation.  I was lucky enough to find such a place at Meadow Hill Wellness in Annapolis, MD.

I actaully first saw an ad for the place in The Bay Weekly, a little newspaper that writes about life on and near the Chesapeake Bay.  I wanted to lose some weight (ok, a lot of weight) and saw a great hypnotherapy program.  So I signed up.  It seems to be working!

By chance, I saw a great program they had for massage.  That, too, turned out to be a huge gift from the Universe.

Meadow Hill Wellness offeres lots of great health enhancing services from yoga and accupunture to hypnotherapy and massage and more.  If Annapolis isn’t too far out of your way, it’s well worth checking out.

Their link has found home in the sidebar to the right (”Helpful, Informative, Interesting or Just Plain Fun”).  Click on it anytime.