All About Realestate

By Lawrence Roberts

The number of foreclosures will affect both the timing and the severity of the deflation of the housing bubble. It is foreclosures that drive prices lower quickly. Foreclosures control the timing of the crash because they directly impact the must-sell inventory numbers: the greater the number of foreclosures, the greater the rate of decline in house prices. By early 2008, most real estate markets had already surpassed the peak set in the price decline of the early 90s of Notices of Default and Trustee Sales (foreclosures).

Lenders faced high foreclosure rates in the early 90s because they were too aggressive with their lending practices in the rally of the late 80s: it was their own doing. Lenders overheated the market then, and they got burned. Apparently, they did not learn the lesson of history.

One of the problems with the collapse of a financial bubble is the causes get incorrectly identified. When the housing market in California collapsed in the early 90s, the recession and job layoffs were blamed for the problems with the housing market. The recession and layoffs came after the housing market was already in trouble. Unemployment slowed the recovery and added to the foreclosure problem, but it was not the primary cause of the entire pricing downturn. The ultra-aggressive lending practices of the housing bubble caused a huge spike in foreclosures by early 2008. Just as in the early 90s, the increase in defaults and foreclosures is being caused by the past sins of the lenders: karma on grand scale.

The importance of the foreclosures cannot be overstated: sellers do not lower their prices voluntarily. Prices do not drop without massive numbers of foreclosures to push them down. The entire “soft landing” argument boils down to one supposition: the number of buyers in the market is able to absorb the must-sell inventory on the market. If this is true, prices do not drop. If this is not true, prices do drop until enough buyers are found to purchase the foreclosures.

There are always a number of buyers when prices are declining; some are long-term homeowners who are present in any market, but many are speculators betting on the return of appreciation. These people are few in number, but they buoy the market if there are not many foreclosures. If foreclosure numbers really spike, prices fall until Rent Savers and Cashflow Investors enter the market and absorb the excess.

If current trends continue, the number of foreclosures will be too great for long-term owners and speculators to absorb. Foreclosures also control the depth of the decline to some degree. Once prices fall down to their fundamental values, new buyers enter the market and begin to absorb the inventory. If there are not enough buyers at this price level to absorb all the foreclosures, prices could overshoot fundamentals to the downside; in fact, this does tend to happen at the bottom of the real estate cycle.

About The Author

Lawrence Roberts is the author of The Great Housing Bubble: Why Did House Prices Fall?
Learn more and get FREE eBooks at: http://www.thegreathousingbubble.com/
Read the author”s daily dispatches at The Irvine Housing Blog: http://www.irvinehousingblog.com/

By Caterina Christakos

A hue and cry has gone up in the largest of Floridas counties regarding annual double-digit increases in tax assessments on multifamily property for the past 3 years. At last, some relief appears to be in sight.

A little-known and little-used provision of Florida property tax law is being touted as an avenue of tax relief for owners of certain large apartment complexes financed with State funds.

Under the State Housing Tax Credit Program, certain categories of state-financed rent-restricted apartment complexes are entitled to an annual property tax break.

What property is eligible?

In order to qualify for tax relief under this program, the apartment buildings or complexes must have been built with restrictive financing that gave them lower interest rates or some other benefit in exchange for keeping rents in a range defined as affordable by the federal government.

Typically, these are larger apartment complexes. In order to get the favorable loan, the owner had to set aside some or all of the rental units in the building or complex for people earning low to medium wages.

If the borrowers violate these affordable-rent covenants, they run the risk of the loan being in default or payment being accelerated. In most cases, the owners signed rental agreements with lenders that run 20 or 30 years, or more. Once the low-rent covenant is in place, it is generally adhered to throughout the term of the loan. Observance of these and similar covenants make the loans doable in the first place.

Although the State Housing Tax Credit Program statute has been on the books for years, it appears that landlords have not been taking advantage of its provisions, according to Frank Jacobs, Property Appraiser for Miami-Dade County . A list we obtained from the State of Florida contains 172 potentially eligible apartment developments in Miami-Dade County and 1,136 statewide .

Under the current state law, Jacobs said, he can take those financing agreements and draft a land-use restriction for the owners to sign that mirrors the agreement. A county property tax break can be given once the land-use restriction is in place and is recorded in the public records. After recordation, the agreement to limit the units to qualified tenants is the equivalent of a zoning or other land use provision containing the same limitation.

It is the dignity or stature of the rent-restriction covenant as a land-use restriction which allows the county property appraiser to enforce this agreement as though it were an ordinance or statute, within the contemplation of the so-called just value statute which governs preparation of tax assessments generally.

What is the benefit to taxpayers?

Qualifying properties are entitled to be assessed based on their actual income, rather than on market income, which is the general standard in Florida . Because affordable housing is synonymous with below-market rental rates, the advantage of being assessed based on actual rent rather than market rent is self-evident.

For rent-restricted affordable housing rentals, the difference between value based on actual income derived under government-controlled rents and market rent can be significant. In some instances it can spell the difference between a viable financial operation and failure.

To offer an example by analogy, one need look no further than a large apartment complex in Miami-Dade County . Although not part of the State program, the Property Appraisers preliminary assessment of $89 million for 2005 was reduced by a Value Adjustment Board Special Magistrate to $80 million by recognizing actual income and expenses, as opposed o supposed market rates used by the Property Appraiser in preparing the assessment.

Buildings already subsidized with Section 8 vouchers or financed with Low Incoming Housing Tax Credits (LIHTC) are not eligible for the program.

Other properties enrolled in the State Housing Tax Credit Program are eligible for this special benefit. Details can be found under section 420.5093, Florida Statutes.

Statutory guidelines include eligibility requirements, treatment of low income housing agreements recorded in the public records as land use restrictions, and recognition by the property appraiser of the actual rental income from rent-restricted units, rather than market rental rates.

If you are an owner or operator of large multifamily apartment complexes and wish to learn more about the special property tax treatment accorded under the State Housing Tax Credit Program, please see About the Author.

About The Author

Caterina Christakos is a published author. To find out more about property taxes, property tax appeals and homestead exemptions go to: http://www.financialinvestmentsdirectory.com/Property_Taxes/

By Lawrence Roberts

One of the primary mechanisms for inflating the housing bubble was the widespread use of exotic loan terms including interest-only and negative-amortization adjustable rate mortgages. The appeal of interest-only and negative-amortization loans is the lower payments they offer, or their ability to finance larger sums of money with the same payment. These loan terms are unstable, and they may not be offered to future buyers. If these loan programs were eliminated, the financing sums would decline, and home prices would decline along with them.

Adjustable rate mortgages are very risky; it is a risk that has been forgotten, ignored, or not understood by a great many buyers. In an era of steadily declining interest rates, the risks of adjustable rates mortgages do not become problems and many forget (or never realized) the risks were there. Once prices decline to a point where the loan balance is greater than the value of the property, mortgage holders are unable to refinance when their mortgage reset comes due. Most often this will result in a foreclosure. In fact, this is the primary mechanism of the decline, and it will also prevent any meaningful appreciation for years to come.

Of all the factors that contributed to the inflation of the housing bubble, the negative amortization loan with its offers of extremely low initial payment rates was the primary factor that pushed prices higher than anyone could previously imagine. Toxic loan products, or as the lending industry likes to call them, affordability products, distort the traditional measure of the debt-to-income ratio. The debt-to-income ratio is calculated with an assumption of a 30-year fixed rate mortgage, when in reality, borrowers were using interest-only and negative amortization loans to keep their debt-to-income ratio to manageable levels.

Since adjustable-rate mortgages of all types performed poorly during the collapse of house prices, and in particular the negative amortization loans, it is likely these loan terms will be curtailed or eliminated in the future. These loans are inherently unstable and prone to high default rates due to the escalating payments that can, and often do, result from their use. The widespread use of these loans destabilizes home prices by detaching them from fundamental valuations. The use of these loans creates the very conditions in which they poorly perform.

People who purchased during the bubble rally at inflated prices using these loan terms were risking that these terms would always be available to buyers in the market because without these terms, future buyers would not be able to finance the inflated sums necessary to allow a bubble rally buyer to get out with a profit. Without these exotic loan terms the housing bubble could not stay inflated.

About The Author

Lawrence Roberts is the author of The Great Housing Bubble: Why Did House Prices Fall?
Learn more and get FREE eBooks at: http://www.thegreathousingbubble.com/
Read the author”s daily dispatches at The Irvine Housing Blog: http://www.irvinehousingblog.com/

By Aydan Corkern

It is difficult to think about taking advantage of the hardships of others and normally most people will not. It is no secret that many people in America are losing their homes left and right because they either got a mortgage that they could not afford, they signed into a bad mortgage with a adjustable interest rate that skyrocketed, or they have lost their jobs and can no longer afford their house payment. It is always a tragedy for someone who has been in a home they have been paying on, sometimes for years, and suddenly they have to give it up and move out because their home has been foreclosed on.

Fortunately, not everyone has had such a bad time of it. Not yet anyway. There are still plenty of folks out there who have their good jobs and have a little money put aside. They probably still have their credit in tact as well. For these people, now could be a great time to take advantage of a piece real estate that they could get at a great price.

Right now a lot of banks and mortgage companies are getting overrun with properties that they have had to foreclose on. Since almost everyone is afraid to invest anything because of the economic strain, they are not able to sell them easily. Prices have dropped because there simply are not enough people in the market to buy homes.

If you have ever been interested in buying a property that you could fix up a little and then turn around and sell or rent out later, this might be the right time for you to do it. If you can get the property financed, which might not be all that easy because banks are not lending like they were, then you can buy a property, work on it for a while and then decide what to do with it. If you did that and found that you could not get what you wanted for it right away, you could always rent it out temporarily until the market recovers enough for you to sell it at a decent profit.

It probably would not be a good idea to risk your retirement money or take out a loan against your existing home to do this kind of investment venture. The reason for that is that you want to make sure you keep your home protected and do not jeopardize what you have. It could be a good idea to discuss any investment into real estate with a financial adviser before you act just to make sure it is a good thing for you to do at this time.

About The Author

Aydan Corkern is a writer, water damage restoration professional, and promoter of http://www.superdry911.com/states/texaswaterdamagerestoration.php and http://www.superdry911.com/states/floridawaterdamagerestoration.php

By Ron Stone

So many people are remodeling homes before trying to resell or flip houses. But mistakes are being made that could make your home difficult to market. Like the couple we saw on TV who took the closets out of 2 basement bedrooms and slashed the resale value of their home. They literally turned their home from a 4 bedroom house to a 2 bedroom house by making one bad remodeling decision.

Here are some things you never want to do to your house if you want it to resell more promptly.

1. Don”t take out bedrooms unless you have more than 3 or the market in your area is mostly singles or couples without children.

2. Don”t try to sell a room as a bedroom unless it meets the code definition of a bedroom. A bedroom must have a closet and egress. Egress means a window or door, usually with minimum measurements to the exterior in case of fire. You can”t get around building code and neither can an appraiser. If you have a room that does not meet this code you might call it a home office and stage it like one.

3. You also don”t want to walk through one bedroom to get to another. Weird floor plans are death to resale. If you don”t know what a floor plan should look like for resale ask help from an expert.

4. You need a master bath in most markets most of the time. Lots of small houses or houses more than 50 years old may have 1.5 baths or 1 bath. Resale is tough for those houses. Most buyers want at least 2 baths. One of the baths should be just for the occupants of the master bedroom and accessed from the master bedroom. If your house does not have a master bath try to add one in the footprint of the house. An architect or designer can help you find the space for it.

5. Don”t over improve a house as an “investment”. It can only pay off for you if you get more at resale than you spent. Most remodels just don”t pay off that well. A 90% return is still a 10% loss.

Cleaning and painting are still the best investments for people who want to sell a home. Extensive remodeling in your individual taste might be more of a barrier to resale than a help. Whatever you do, keep it simple and watch the budget. If you paid a market price for your house it may take years for it to increase in value enough to reap the financial benefits. Do things that you can enjoy and afford. Don”t refinance to pay for the work.

About The Author

Ron Stone owns a note buying business. His company purchases private mortgage notes, including non-seasoned notes from home sellers offering owner financing. Learn more about note selling at his websites, http://www.us-mortgage-buyer.com as well as http://www.us-note-buyer.com

By Beth Ibarra

It is hard to deny that we live in a consumer driven society. Advertisements urge us to buy the biggest and the best everywhere we go. It is no wonder then how people can quickly push themselves far into debt by taking out large loans to cover the expense of purchasing these items. The key in most cases is to have a clear idea of what you are borrowing the money for and whether or not you truly need to take out a loan to purchase the things that you want.

If you are considering taking out a reverse mortgage on your home to borrow money, you might be wondering how much it too much for you to borrow. First of all, you might want to get a reverse mortgage quote to see how much you qualify to borrow before deciding how much you will borrow. Doing this can help you determine if you are even eligible to borrow the amount of money that you need. Therefore, you will not be making plans to spend the money just to find out that you do not qualify to borrow it.

Once you have received a reverse mortgage quote, you can then see how that amount differs from the amount you need to borrow with the reverse mortgage. If the quote is less than you had planned to borrow, you will have to determine if you can cut down the amount you need to fit with the amount of the quote. If the amount of the quote is larger than the amount you thought you needed on the other hand, you might need to resist the urge to borrow excessively by taking out the full amount that you were quoted.

Another way to avoid borrowing too much on your reverse mortgage is to make a detailed budget on what you will be borrowing the money for. Making a detailed budget will not only give you a solid idea of how much money you need to borrow but can also help you avoid spending your loan money on other things.

You also might want to speak with other home owners that have gone through the process of taking out this reverse type of mortgage to see how they approached the matter. They may be willing to tell you what worked and what did not work for them throughout the process and may have some tips for you on how to make the process go smoothly. This would also be a good opportunity for you to ask any questions that you may have.

In the end, only you know how much is too much to borrow for your reverse mortgage. You know your personal history of borrowing money and making repayments on that borrowed money. As with any type of loan, the matter of borrowing money with a reverse type of mortgage is one that should be approached with a great deal of thought and caution. It is often when people apply for loans without fully thinking through their decision that they get themselves into problems with debt.

About The Author

More information on reverse mortgages http://www.myrefi.com is just a click away.

By Aydan Corkern

Normally, people do nor go around wondering and worrying about water in a house, unless of course, you are planning on trying to buy that house. Just hearing the word water damage is enough to scare buyers away because they automatically think they would be doomed to invest thousands of dollars in the right away to have it repaired. That is not always the case and if you are looking at a home, you should learn which types and to what extent water damage should be a concern.

Any time you are thinking about buying a house, it needs to be and usually does have an inspection done. Sometimes it will be paid for by the current homeowner, but if you are afraid of getting a biased opinion and report, you might could hire someone yourself. Home inspectors are normally impartial as they should be and will deliver a report that is accurate and honest to the best of their ability.

When you first receive the results of the report keep an open mind. Almost any home that is not brand new is bound to have an issue or two. With very old homes there is likely to be several. Sometimes you can renegotiate the price with the current owner or you could ask them to make some repairs as part of their asking price. This is what real estate agents are for. They can negotiate back and forth with the owner for you until the two parties can come to an agreement.

If you learn that there is some water damage in the home, consider how bad it is reported to be. If is something minor like a toilet area that needs replacing. This might not be so bad. It could only involve taking up the toilet and floor covering and replacing some sub flooring. A handy homeowner might be able to do this job themselves. The cost will be minimal for supplies, but you could negotiate a lower buying price for your trouble.

However, if you discover that the roof, attic, basement, or a large portion of floor or wall structure has water damage, this you might want to consider more carefully. Something this significant could very well cost you thousands of dollars. Then you would want to know whether there is any mold associated with this water damage because there often is. Mold can be very expensive to have removed if it is also extensive. If you find severe problems like these are involved, you might reconsider buying the home at all or at least make sure you get a great enough price to pay for the repair.

About The Author

Aydan Corkern is a writer, water damage restoration professional, and promoter of http://www.superdry911.com/states/texaswaterdamagerestoration.php and http://www.superdry911.com/states/kentuckywaterdamagerestoration.php

By Ron Stone

Kitchens can cost a lot of money. And people who buy them rarely get the money back at resale in even in good real estate markets.

But there are things you can do that will cost less money and still get you a reasonable return. A return means that you actually get a buyer and a decent price for your house, and make more than you spent.

1. Find a way to open your kitchen to the dining room and family room. In many older ranches and split-level homes it may be as easy as taking out the upper cabinets between the kitchen and breakfast area. Be careful about taking out walls. If they are load bearing walls your house might fall on you. You can pay a professional for it and then handle the rest yourself.
2. Many older homes have good quality solid wood cabinets that are better than what you could purchase new to replace them. Explore alternatives like painting or stripping paint and other refinishing options.

Watch out for lead paint. Many older homes have it and it requires expert removal. Lead paint was outlawed in 1978. If your house is older than that it might have it. It is a hazardous, though natural substance that can cause permanent brain damage. Surprise! “Natural” stuff can hurt you, both adults and children. Check it out online and act accordingly.
3. You can buy good stuff second hand. One of the cutest kitchens I ever saw was built from a nice assortment of second hand furniture. You can even buy nice cabinets second hand. Second hand windows and doors can become china cabinets for the dining room.
4. A big pantry makes excellent storage for a kitchen for very little money. A pantry about 5 feet square has room for a small chest freezer and plenty of shelving for things that don”t fit in cabinets or canned foods. Shelves that are not too deep work best. An effective cabinet can be as shallow as 3.75″ with a door between 2 studs.
5. You can create the look of a custom kitchen by finishing off the ends of you cabinets and the backs of islands and peninsulas. It”s a subtlety that people will notice but maybe not understand. It says “quality” without costing a lot of money.
6. Don”t break the bank buying granite. That stuff is expensive and it”s not very green either. Try papercrete, recycled marble or other stone, bamboo butcher block, ceramic tile, stone tile or anything that is on the cheaper side of materials. You can also paint or skim coat existing counter tops.
7. A nice cook top and 2 separate stacked ovens are generally cheaper than the big commercial ranges. Buy energy star rated appliances and save big dollars every day. You might even find them second hand.

So there you are. These are all my favorite ways to save and still have a nice kitchen. We once refaced a whole big kitchen with 46 door and drawer panels for $1,200. We had a cabinetmaker make the doors and then spray painted them ourselves. It helped our home sell and close in 6 weeks when we decided to move. The previous owners had it for sale for over 2 years with the old tired 80s style cabinets. Faster resale says you don”t have to keep making payments. Many house payments are more than we spent on our kitchen.

About The Author

Ron Stone has a private mortgage note buying business. His company purchases private mortgage notes, including un-seasoned notes created at the sale of a home. Learn more about note selling at his websites, http://www.us-note-buyer.com and http://www.us-funding-solutions.com/mortgages.htm

By Kristi Ambrose

It doesn”t matter if you are buying to sell or buying to live; a home is one of the most important buys you will ever make. This is a place where you are going to hang your hat so to speak so you will really want to make sure it”s one that you have a certain love for.

A lot of people can tell right away if they like a house or not, others need time to “inspect”. Personally for me, I can look at a house and immediately know if it”s the one for me even just by looking at the outside. Of course I usually give it a try inside as well but for the most part I am pretty sure right away!

The first thing you”re going to want to do is figure out where you want to buy from, have it be in your own state or elsewhere. Personally for me I would pick up and move to Florida any day of the week. Of course you can”t just move and find a house one day and move in the next; it”s not this easy!

The next best thing you can do for yourself is to look online at different real estate properties. These are nice because you can view the properties online any time you want, they have all the information one would need to make a decision and they include pictures and sometimes even videos for you to see or watch. For example, if you are interested in farm properties in Virginia you can go on certain websites and find the following properties and information:

Most all of the properties available on these sites will be located ON these sites, however, in some instances you may be directed to the website owners other websites as well. You can also simply call the agent and he or she can answer any of the questions or concerns that you may have about that particular property.

For this particular website there are locations such as; Charlottesville, Culpeper, Fauquier, Loudoun, Middleburg, Warrenton, Prince William County and more, so depending on what you are looking around for you merely click on the location and you will be sent to a page with the available properties. It”s a really nice process that speeds up the procedure for you and as aforementioned you can view all the photos and features right on the website.

This is all about convenience for you the potential buyer because now you don”t have to go to 500 sites to find different properties. One site and you have it all available in an organized fashion!

About The Author

This author is a huge fan of http://www.virginia-farms.org

By Lawrence Roberts

The real estate market can be visualized as a massive pyramid. There are very few multi-million dollar properties at the top of the pyramid, and a large number of relatively inexpensive entry-level properties forming the base. Like any structure, if the foundation is weakened, the structure may collapse. In the same way, housing markets collapse from the bottom up due to problems with affordability.

The foundation of a residential real estate market is the entry-level buyer. Entry-level buyers are generally young people starting to form new households. When homeowners want to sell their house and move up to a nicer one, someone needs to buy their house. If you follow this chain of move-ups backward, eventually you come to an entry level buyer. If there are no entry level buyers pushing the sequence of move ups, the entire real estate market ceases to function.

The entry level market was initially boosted the moment 100% financing became available because many more people were enabled to purchase; however, it was imperiled at the same time because of the change in savings incentives. This market was subsequently destroyed the moment 100% financing was eliminated because few entry-level buyers had a downpayment and very few people were in the process of saving to get one.

In the past, people would rent and save money until they had the requisite downpayment to acquire a house. The barrier to home ownership was not the ability to make payments; it was having the necessary downpayment money. When downpayment requirements go up, the number of people capable of buying a house declines considerably, particularly for entry-level buyers who must save this money rather than transfer it from a previous sale. Since few potential entry-level buyers were saving money during the rally, sales volumes suffered dramatically in the wake of the bursting real estate bubble.

The weakness in the base of the housing market is going to serve as a drag on sales and pricing for many years to come. The government will likely come up with some artificial stimulus to encourage sales, but once the stimulus wears off, the same underlying problems will resurface. We must rebuild the base of the housing market through savings and stable financing, and we must endure whatever financial hardships are required to overcome our years to artificial economic stimulants. This will take time because the bad incentives and practices of the housing bubble.

About The Author

Lawrence Roberts is the author of The Great Housing Bubble: Why Did House Prices Fall?
Learn more and get FREE eBooks at: http://www.thegreathousingbubble.com/
Read the author”s daily dispatches at The Irvine Housing Blog: http://www.irvinehousingblog.com/