Saturday, February 28, 2009
Friday, February 27, 2009
LINKED IN COMPANY NEWSLETTER
Understanding The American Recovery and Reinvestment Act
What the stimulus package means to you and your customers
As trusted advisors to your customers and clients, helping them make intelligent decisions has never been as important as it is now. The American Recovery and Reinvestment Act that Congress passed two weeks ago has been confusing everyone as it traveled between Senate and House committees to eventual passage. The attached flyer is important to your current business because you may have a pending transaction that will benefit from this bill. You may also use this flyer to send to a past client who closed on an eligible property since January 1, 2009, and more importantly, who in your sphere may have been on the fence about a purchase of a home?Remember, your customers have been seeing and hearing our Qualified Answers TV and radio campaign and you should note that it is clearly directed to the first-time home buyer. The stimulus package also addresses the first-time home buyer as its main target to help jump-start the economy as noted in the attached flyer.Click Here for the CBWS Stimulus FlyerClick Here for the CBKT Stimulus Flyer
Qualified Answers Campaign Update
Don't forget to use the Qualified Answers Agent resources materials available to you.Click Here for the King Thompson Qualified Answers E-CardClick Here for the West Shell Qualified Answers E-CardClick Here for the King Thompson Qualified Answers FlyerClick Here for the West Shell Qualified Answers FlyerAlso, Please view the following two videos for more information about our current campaigns in our local markets.
Introduction and TV spotTV spot only
Please feel free to use these links from our YouTube Channel for your own blogs, personal sites, profile pages and social networking.
2008 Recognition and Awards Events
How's your office Spirit planning coming? We can't wait to see it at the Awards Events!
Cincinnati:Tuesday, March 24Hilton Cincinnati Netherland Plaza8:30-9:30 Continental Breakfast/9:30 ProgramRSVP to your OA no later than 5:00pm Wednesday, March 18
Our Service Guarantees Make Home Loans Easy
Tell your customers to call your local Mortgage Advisor to get a same-day loan decision, guaranteed!
Our Guarantees Make the Mortgage Process Easier
What the stimulus package means to you and your customers
As trusted advisors to your customers and clients, helping them make intelligent decisions has never been as important as it is now. The American Recovery and Reinvestment Act that Congress passed two weeks ago has been confusing everyone as it traveled between Senate and House committees to eventual passage. The attached flyer is important to your current business because you may have a pending transaction that will benefit from this bill. You may also use this flyer to send to a past client who closed on an eligible property since January 1, 2009, and more importantly, who in your sphere may have been on the fence about a purchase of a home?Remember, your customers have been seeing and hearing our Qualified Answers TV and radio campaign and you should note that it is clearly directed to the first-time home buyer. The stimulus package also addresses the first-time home buyer as its main target to help jump-start the economy as noted in the attached flyer.Click Here for the CBWS Stimulus FlyerClick Here for the CBKT Stimulus Flyer
Qualified Answers Campaign Update
Don't forget to use the Qualified Answers Agent resources materials available to you.Click Here for the King Thompson Qualified Answers E-CardClick Here for the West Shell Qualified Answers E-CardClick Here for the King Thompson Qualified Answers FlyerClick Here for the West Shell Qualified Answers FlyerAlso, Please view the following two videos for more information about our current campaigns in our local markets.
Introduction and TV spotTV spot only
Please feel free to use these links from our YouTube Channel for your own blogs, personal sites, profile pages and social networking.
2008 Recognition and Awards Events
How's your office Spirit planning coming? We can't wait to see it at the Awards Events!
Cincinnati:Tuesday, March 24Hilton Cincinnati Netherland Plaza8:30-9:30 Continental Breakfast/9:30 ProgramRSVP to your OA no later than 5:00pm Wednesday, March 18
Our Service Guarantees Make Home Loans Easy
Tell your customers to call your local Mortgage Advisor to get a same-day loan decision, guaranteed!
Our Guarantees Make the Mortgage Process Easier
Buying a home may be the largest financial transaction your customers will ever make. That's why it's important for customers to work with a lender they can trust, who will guide them through the process. When you recommend Coldwell Banker Home Loans, we'll give your customers a smooth and easy mortgage experience. That's more than just a promise-because we back up our program with the strongest service guarantees in the industry.
It starts with our pre-approval decision.
We make home loans easy, the minute your customers contact us. We'll give them a same-day loan decision, guaranteed-or we'll pay them $250. In fact, most loan decisions are made within 20 minutes. With a pre-approval letter in hand, your customers will know exactly how much house they can afford when they begin house-hunting. And we'll tell them up front exactly what they need to do to get to closing. Once they've found a property and registered their loan with us, an experienced loan processor will assist them at each phase of the mortgage process.
We guarantee to close on time.
We take the time to tell your customers up front exactly what they need to do to get to closing to reduce any chance of delay. But that's not all-we'll meet your customer's requested closing date, guaranteed, or we'll reduce their interest rate by 1/8 of one percent for the life of their loan.** Now, that's service!
Ask your customers to contact your local Mortgage Advisor for a free, same-day loan decision-guaranteed!
**Approved, conventional, purchase loans only. Excludes loans for REO homes. Closing date to be mutually agreed upon between customer and us, and customer must provide all required documentation. Timely request for adjustment under guarantee is required.
Concierge News
Helping You Build Customers For Life
It's RCI Time!
Concierge News
Helping You Build Customers For Life
It's RCI Time!
Watch your e-mail for the RCI Spring flyer and order form for our group RCI order. Deadline for orders is March 11 so act quickly!
Welcome to P&G Property Solutions, recommended by Gary Rogers of the Wyoming office. P&G specializes in mold testing and remediation as well as replacement windows, gutter guard systems and power washing.
Contact the Concierge
Cincinnati: 513-794-9464 -or- concierge-cbws@cbws.com
Carp's Corner - Let Go of the Ego
By: Sean Carpenter
Carp's Corner - Let Go of the Ego
By: Sean Carpenter
Please don't get me wrong. I understand that everyone has an ego and it will manifest itself in different ways. For many of our industry's top producers, it was part ego that got them where they are today - a true desire to be recognized as one of the best. Just be sure to remind yourself every now and then that this business isn't about you - it's about the clients you serve and the other people you interact with.
To read more of Let Go of the Ego, visit Sean's blog at www.therealtorstoolbox.blogspot.com/
January CE Classes
Upcoming Schedule
Cincinnati:
January CE Classes
Upcoming Schedule
Cincinnati:
Core Law: Wednesday, 3/4, 10am-1pm - Northeast Office
Principles of Personal Business Management: Thursday, 3/5, 1pm-4pm - Wyoming Office
Professional Home Inspection Benefits: Wednesday, 3/11, 9am-12pm - Anderson Office
Negotiating to a Win-Win: Wednesday, 3/18, 1pm-4pm - Northeast Office
For additional information or to register, contact susan.trefilek@cbws.com.
Upcoming C:BOLT Sessions
Do I Need An MBA To Do A BMA? Wednesday, 2/25, 1pm - Joanne Figge
Upcoming C:BOLT Sessions
Do I Need An MBA To Do A BMA? Wednesday, 2/25, 1pm - Joanne Figge
Turning Research Into Results - Understanding Who Your Clients Are in 2009 Wednesday, 2/25, 1pm - Sean Carpenter
It's A Contact Sport Wednesday, 3/4, 1pm - Jenny Ward
SEAN CARPENTER NEWS
Greetings All,
As the “trusted advisors” to your clients in today’s ever-changing real estate landscape, understanding what your clients may be thinking and how their decisions are based may put you in a good position.
Each year the National Association of Realtors® conducts their Home Buyer and Seller Profile to gain understanding into many aspects of the real estate transaction. I recently recorded a CBOLT session called “Turning Research into Results: Finding Out Who Your Clients are in 2009” that explored the facts and figures of this report.
I would highly recommend that you make every effort to listen to this session and become more knowledgeable on some of the statistics that resulted from this profile. It will give you some great insight and talking points for use with your clients in 2009.
Here is the link to the session. Enjoy!
https://cbolt.webex.com/cbolt/lsr.php?AT=pb&SP=TC&rID=21369992&act=pb&rKey=2798055137E9BE74
Sean M. CarpenterDirector Of Training & Education, Ohio NRT
Coldwell Banker King Thompson
Coldwell Banker West Shell
614-889-0808- (Office)
614-526-5600- (Direct)
513-686-7643 - (Cincinnati Office)
"Nobody Knows Homes Like A Carpenter!"
Looking to "build" your business? Visit The Realtor's Toolbox Blog
As the “trusted advisors” to your clients in today’s ever-changing real estate landscape, understanding what your clients may be thinking and how their decisions are based may put you in a good position.
Each year the National Association of Realtors® conducts their Home Buyer and Seller Profile to gain understanding into many aspects of the real estate transaction. I recently recorded a CBOLT session called “Turning Research into Results: Finding Out Who Your Clients are in 2009” that explored the facts and figures of this report.
I would highly recommend that you make every effort to listen to this session and become more knowledgeable on some of the statistics that resulted from this profile. It will give you some great insight and talking points for use with your clients in 2009.
Here is the link to the session. Enjoy!
https://cbolt.webex.com/cbolt/lsr.php?AT=pb&SP=TC&rID=21369992&act=pb&rKey=2798055137E9BE74
Sean M. CarpenterDirector Of Training & Education, Ohio NRT
Coldwell Banker King Thompson
Coldwell Banker West Shell
614-889-0808- (Office)
614-526-5600- (Direct)
513-686-7643 - (Cincinnati Office)
"Nobody Knows Homes Like A Carpenter!"
Looking to "build" your business? Visit The Realtor's Toolbox Blog
Wednesday, February 18, 2009
TIPS FOR STAGING
10 tips for staging your home for the real estate market
By Sarah Crump • The Plain Dealer • February 14, 2009
Let's face it: This is a scary time to even think of putting your home - probably your biggest lifetime investment - on the real estate market.
A few simple tricks, however, can give you an advantage. The advantage is called "staging," and it is a booming necessity.
We asked three specialists in the Cleveland area for 10 things that can be done to facilitate a sale. Diana Hudson Kresnye, a professional stylist/home stager and owner of Devine Designs; Mark and Elly Ostrovsky, Howard Hanna Realtors; and professional organizer Marge Hogan Mackey of Hogan Organized Living gave us this "have to" list:
1. Cut emotional ties
View your house as a product that needs to be sold, not your home. It's now a commodity. Don't think of it as the place where you raised your kids.
"People need to digest - come to terms with - the fact that they are going to sell," said Diana Hudson Kresnye of Devine Designs Ltd. If homeowners fight her every suggestion and defend their beloved but dated wallpaper and carpet down to the last shred, they are not ready to part with their home. In reality, painting or new carpeting could mean a sale, plain and simple.
2. Walk through like a buyer
Grab a notebook and walk every inch of your home, inside and out. "List everything that needs attention in some way," said professional organizer Marge Hogan Mackey. Take a camera, too. "It's amazing what you will see in a photo that you've passed by or ignored."
That done, follow through and make repairs or updates before signing on with a Realtor. The best pool of buyers comes through the first weeks the home is on the market, said Kresnye. "For most people, those four weeks are wasted, because that's when they start getting ready to move."
3. Update
"Find out how your house stacks up against the competition by visiting open houses in your neighborhood," said Mark Ostrovsky, who with wife Elly is a real estate agent with Howard Hanna's Pepper Pike office.
If houses in your price range look better, hold back with expensive renovations and do simple updates, such as painting a room, retiling a bath, changing light fixtures and window treatments and replacing kitchen knobs. Flooring and carpet, while a more expensive fix, really need to be in good shape.
4. Be streetwise
A house that doesn't look good from the street stops many prospective buyers at the driveway.
In the spring, get a landscaper to freshen gardens and groom trees if you can't do a professional-looking job.
When Mackey was house-shopping, curb appeal determined whether she'd go inside. If she saw crumbling steps, fallen gutters, rickety fences, overgrown bushes, forget it. The inside might be worse.
"I didn't want to move into someone's mess."
5. Declutter
Clearing the way for a sale may mean storing or giving away half of what you own. "If storage is too expensive, then put all of those neatly packed boxes in one place only '" a corner of the basement, the garage or the attic," said Ostrovsky.
However, even if you've moved, don't show a vacant house, said Kresnye. Buyers will assume you're paying two mortgages and low-ball on price.
6. Embrace Mr. Clean
By yourself or by hiring a cleaning crew, deep-clean every surface. Even the insides of closets get a scrubbing or a paint job. "I love those Mr. Clean Magic Erasers," said Kresnye. "They work so well sometimes you don't need to repaint."
Have your carpets and furniture upholstery shampooed. Take a toothbrush to the tile grout. Clean the oven and the microwave. Think pristine.
7. Remove wallpaper
Wallpaper, even new, is just too personal, said Kresnye.
"It's the kiss of death," said Ostrovsky.
Fresh paint on undamaged walls is much better. Prospects do not expect to repaint or strip paper, said Ostrovsky. "Buyers will instead move on to the next house."
8. Lighten up!
Bump up bulb wattage if your light fixture safely permits it, Mackey suggests. If you use a 60-watt, substitute a 100-watt. Dim lighting casts shadows, making your rooms look smaller - a detriment to buyers who want oodles of house for their money.
Trim shrubbery that covers windows, remove overwhelming draperies and wash all windows inside and out. It's amazing how much natural light will shine in - even on the darkest of winter days.
Light fixtures that were the thing in the 1970s should be replaced with something trendier, said Kresnye. If your fixtures look dated, "It sends a signal that your house has not been well maintained."
9. Smells don't sell
Even the cleanest home can have smells. Did you cook fish for dinner? Does the litter box need emptying? It sends a big yuck message to people touring your house.
Have your cigarette outside. "Absolutely do not smoke in your house when it is on the market," said Ostrovsky. "Deodorizers don't work - ever!"
A buyer will run from a mildewy basement, said Kresnye. "The adage in our business is, "If I can smell it, I can't sell it."
10. De-personalize
Remove all family photos, awards, certificates, trophies and refrigerator magnets, said Kresnye. "The house may look stark to you, but it will look fresh and clean to buyers."
And you're putting your youngsters at risk if you let them display things that indicate their names and other private information.
"Child predators can see their photos, know where they go to school and what sports they play," said Kresnye. "You need to take every precaution when selling your house."
By Sarah Crump • The Plain Dealer • February 14, 2009
Let's face it: This is a scary time to even think of putting your home - probably your biggest lifetime investment - on the real estate market.
A few simple tricks, however, can give you an advantage. The advantage is called "staging," and it is a booming necessity.
We asked three specialists in the Cleveland area for 10 things that can be done to facilitate a sale. Diana Hudson Kresnye, a professional stylist/home stager and owner of Devine Designs; Mark and Elly Ostrovsky, Howard Hanna Realtors; and professional organizer Marge Hogan Mackey of Hogan Organized Living gave us this "have to" list:
1. Cut emotional ties
View your house as a product that needs to be sold, not your home. It's now a commodity. Don't think of it as the place where you raised your kids.
"People need to digest - come to terms with - the fact that they are going to sell," said Diana Hudson Kresnye of Devine Designs Ltd. If homeowners fight her every suggestion and defend their beloved but dated wallpaper and carpet down to the last shred, they are not ready to part with their home. In reality, painting or new carpeting could mean a sale, plain and simple.
2. Walk through like a buyer
Grab a notebook and walk every inch of your home, inside and out. "List everything that needs attention in some way," said professional organizer Marge Hogan Mackey. Take a camera, too. "It's amazing what you will see in a photo that you've passed by or ignored."
That done, follow through and make repairs or updates before signing on with a Realtor. The best pool of buyers comes through the first weeks the home is on the market, said Kresnye. "For most people, those four weeks are wasted, because that's when they start getting ready to move."
3. Update
"Find out how your house stacks up against the competition by visiting open houses in your neighborhood," said Mark Ostrovsky, who with wife Elly is a real estate agent with Howard Hanna's Pepper Pike office.
If houses in your price range look better, hold back with expensive renovations and do simple updates, such as painting a room, retiling a bath, changing light fixtures and window treatments and replacing kitchen knobs. Flooring and carpet, while a more expensive fix, really need to be in good shape.
4. Be streetwise
A house that doesn't look good from the street stops many prospective buyers at the driveway.
In the spring, get a landscaper to freshen gardens and groom trees if you can't do a professional-looking job.
When Mackey was house-shopping, curb appeal determined whether she'd go inside. If she saw crumbling steps, fallen gutters, rickety fences, overgrown bushes, forget it. The inside might be worse.
"I didn't want to move into someone's mess."
5. Declutter
Clearing the way for a sale may mean storing or giving away half of what you own. "If storage is too expensive, then put all of those neatly packed boxes in one place only '" a corner of the basement, the garage or the attic," said Ostrovsky.
However, even if you've moved, don't show a vacant house, said Kresnye. Buyers will assume you're paying two mortgages and low-ball on price.
6. Embrace Mr. Clean
By yourself or by hiring a cleaning crew, deep-clean every surface. Even the insides of closets get a scrubbing or a paint job. "I love those Mr. Clean Magic Erasers," said Kresnye. "They work so well sometimes you don't need to repaint."
Have your carpets and furniture upholstery shampooed. Take a toothbrush to the tile grout. Clean the oven and the microwave. Think pristine.
7. Remove wallpaper
Wallpaper, even new, is just too personal, said Kresnye.
"It's the kiss of death," said Ostrovsky.
Fresh paint on undamaged walls is much better. Prospects do not expect to repaint or strip paper, said Ostrovsky. "Buyers will instead move on to the next house."
8. Lighten up!
Bump up bulb wattage if your light fixture safely permits it, Mackey suggests. If you use a 60-watt, substitute a 100-watt. Dim lighting casts shadows, making your rooms look smaller - a detriment to buyers who want oodles of house for their money.
Trim shrubbery that covers windows, remove overwhelming draperies and wash all windows inside and out. It's amazing how much natural light will shine in - even on the darkest of winter days.
Light fixtures that were the thing in the 1970s should be replaced with something trendier, said Kresnye. If your fixtures look dated, "It sends a signal that your house has not been well maintained."
9. Smells don't sell
Even the cleanest home can have smells. Did you cook fish for dinner? Does the litter box need emptying? It sends a big yuck message to people touring your house.
Have your cigarette outside. "Absolutely do not smoke in your house when it is on the market," said Ostrovsky. "Deodorizers don't work - ever!"
A buyer will run from a mildewy basement, said Kresnye. "The adage in our business is, "If I can smell it, I can't sell it."
10. De-personalize
Remove all family photos, awards, certificates, trophies and refrigerator magnets, said Kresnye. "The house may look stark to you, but it will look fresh and clean to buyers."
And you're putting your youngsters at risk if you let them display things that indicate their names and other private information.
"Child predators can see their photos, know where they go to school and what sports they play," said Kresnye. "You need to take every precaution when selling your house."
Wednesday, February 11, 2009
CHARITY FUND RAISER
Silent Auction & Tennis for Charity to benefit Northern KY Children Advocacy Center.
Host: LoAnn Sullivan, Coldwell Banker, Crestview Hills, KY
Date: Saturday, March 28, 2009
Time: 6:00pm - 10:00pm
Location: Five Seasons Sports Club
345 Thomas More Pkwy
Crestview Hills, KY
Only $25.00 for a fun evening with food, drinks, silent auctions, raffle tickets, and tennis mixers at Five Seasons Sports Club in Crestview Hills, KY 41017.All proceeds benefit the Northern Kentucky Children Advocacy Center, which provides services to children who have been sexually abused, and helps them receive the cares they need to restore them to a more normal, healthy life.To better serve the approximate 550 children assisted each year by the NKCAC, a new 5000+ square foot center will open in April 2009 at 4890 Houston Rd in Florence. Through your support, thousands of children will receive the proper education, treatment, interventin and an opportunity to achieve a successful, happy life.Last year, with your generosity, along with our sponsors: Blue Grass Recycling Co. of NKY, Republic Bank, Western Nursing, we were able to raise close to $6,000 for the Center.Please help me again this year, to help the children, one child at a time. When we help a child, we help mold the future. Together, we will succeed.Please call the Community Foundation of Northern Kentucky at (859) 572-3365 for sponsorship information or prize donation, or if you have any questions regarding the event. You may also contact event chairperson, LoAnn Sullivan by calling Coldwell Banker Office at 859-341-9000.You can also send gifts, check (made payable to NKCAC) and mail to:
LoAnn Sullivan
Coldwell Banker West shell
10 Town Center Boulevard
Crestview Hills, KY 41017
All donations are fully tax deductable.Thank you for your participation in this important fundraiser.
Saturday, January 17, 2009
PARTNERSHIP WITH KENTON COUNTY SCHOOLS
Coldwell Banker West Shell in Crestview Hills is proud to announce
it's partnership with Kenton County School District.
Our agents will be helping the schools in our community in a variety of ways.
Just another way our agents give back!!!
Wednesday, January 14, 2009
TIME TO THINK ABOUT BUYING...
It May Be Time to Think About Buying a House
By RON LIEBER
Five or 10 years from now, when the financial crisis has ended and housing prices are up smartly once more, we will look in the rearview mirror and realize that we missed a golden age for first-time home buyers.
Then, everyone who sat on their down payment savings accounts for a few years too long will kick themselves for not taking advantage of what may turn out to be the buying opportunity of a lifetime for those who can qualify for a mortgage.
Unfortunately, we do not know when this golden age will begin, because we will be able to identify a bottom to the housing market only with the benefit of hindsight. But as it does with the stock market, the moment will probably arrive when everyone is feeling the most pessimistic.
That moment is certainly getting closer. Housing prices have fallen drastically from their peak levels in many areas of the country. Rates on 30-year fixed-rate mortgages are already close to 5.5 percent, and this week there were suggestions that the federal government might try to drive them down to 4.5 percent, a truly incredible figure to be able to lock in for three decades.
Meanwhile, first-time home buyers have the same advantage they have always had, which is that they do not have to sell their old place before buying a new one. That is an added advantage in areas where many available houses simply are not moving, because the people trying to sell them will not be bidding against you.
If you’re hoping for a recovery in the housing market, you ought to be cheering on the first-time home buyers. When they purchase homes, their sellers are free to move on or move up, stimulating further sales.
But if you are a potential first-time buyer yourself, or lending or giving the down payment to one, you are probably as frightened as you are tempted by all the “For Sale” signs that have become “On Sale” signs. So let’s quickly review some of the still-grim pricing data in certain areas — and consider the reasoning offered up by first-time buyers who have forged ahead anyhow.
As is always the case with real estate, much depends on location. One study, “The Changing Prospects for Building Home Equity,” tries to predict where today’s first-time buyers in the 100 biggest metropolitan areas may actually have less home equity by 2012 as a result of continued price declines. The verdict was that buyers in 33 of the markets could see a decline by 2012, including potential six-figure drops on an average home in the New York City, Los Angeles, San Francisco and Seattle metropolitan areas.
This is obviously scary. (I’ve linked to the study, a joint effort of the Center for Economic and Policy Research and the National Low Income Housing Coalition, from the version of this article at nytimes.com/yourmoney.) It’s worth noting, however, that these predictions came before the government made its most recent move to reduce borrowing costs.
Also, the price projections in the study are based, in part, on the fact that the ratio of purchase prices to annual rents is still higher in many areas than the historical average, which is roughly 15 times rents. While past figures may well have some predictive value, I have never been convinced that first-time buyers compare a home that they could own and one that they would rent in purely or even primarily economic terms.
When Jaime and Michael Proman moved this fall to Minneapolis, his hometown, from New York City, they craved a different sort of life after two years together in a 450-square-foot studio apartment. “We didn’t want a sterile apartment feel,” said Mr. Proman, who is 28 (his wife is 26). “We wanted something that was permanent and very much a reflection of us.”
The fact is, in many parts of the country there are few if any attractive rentals for people looking to put down roots and enjoy the sort of amenities they may spot on cable television home improvement shows. Comparing a rental with a place that you may own seems almost pointless in these situations, especially for those who are now grown up enough to want to make their own decisions about décor without consulting the landlord.
Still, for anyone feeling the urge to buy, a number of practical considerations have changed in the last year or two. The basics are back, like spending no more than 28 percent of your pretax income on mortgage payments, taxes and insurance. Even if a lender does not hold you to this when you go in for preapproval, you should hold yourself to it.
You will also want to start now on any project to improve your credit score because it may take several months to get it above the 720 level that qualifies you for many of the best mortgage rates.
John Ulzheimer, president of consumer education for credit.com, a consumer credit information and application site, suggests starting to pay down and put away credit cards months before you apply for a loan. That is because the credit scoring system could penalize you if you use a lot of credit each month, even if you always pay in full. Also, check your three credit reports (it’s free) at annualcreditreport.com and dispute errors.
While no one can easily predict the likelihood of losing a job, Friday’s startling unemployment figures suggest the need for caution if you think you might be vulnerable. A. C. Panella, who teaches communications at Pasadena City College in California, waited until she had a tenure-track job before buying a home in the Highland Park section of Los Angeles with her partner, Amy Goldman, a lawyer for a nonprofit organization. “We could afford the mortgage payment on one salary, were something to come up,” Ms. Panella, 31, said. “It’s really about being able to stay within our means.”
For many first-time home buyers, that philosophy stretches to the down payment, too. Ms. Panella and her partner put down 20 percent when they bought their home in September, as did the Promans when they bought their home in the Lowry Hill neighborhood of Minneapolis.
Alison Nowak, 29, put just 3 percent down on a Federal Housing Administration-backed loan last month when she and her partner, Lacey Mamak, bought a $149,900, 800-square-foot home several miles south of where the Promans live. “Anything that is an opportunity also has a bit of risk,” she said. Her house was in foreclosure before a plumber bought it and fixed it up. “One way we mitigated it was that we bought a really tiny house in a very good neighborhood.”
One other strategy might be to buy new instead of used. Ian Shepherdson, chief United States economist for the research firm High Frequency Economics, says he believes that a steep drop-off in inventory of new homes is coming soon, thanks to a rapid decrease in home builder activity.
Since prices generally soften in the winter, it may make sense to start looking seriously once the mercury bottoms out. “If you look at new developments next spring, you may not have the choice you thought you would have or be in the bargaining position you thought you would be,” Mr. Shepherdson said. Also, if you wait after June 30, you will miss out on a $7,500 federal tax credit for income-eligible first-time home buyers that works like an interest-free loan.
Finally, allow yourself to consider how it would feel if you bought and then prices dropped another 10 or 15 percent. It might not bother you if you plan to stick around. Plenty of people seem to be making a longer commitment to their homes. According to a survey that the National Association of Realtors released last month, typical first-time buyers plan to stay in their home 10 years, up from 7 last year.
Perhaps people are more aware that they will not be able to build equity as rapidly as others did in the real estate boom. Or they simply have more confidence in hard, hometown assets now than in other markets.
“We wouldn’t let another decline bother us,” said Michael Proman. “You can never time a bottom. This is a long-term investment for us, and it truly is the best investment we have in our portfolio right now.”
By RON LIEBER
Five or 10 years from now, when the financial crisis has ended and housing prices are up smartly once more, we will look in the rearview mirror and realize that we missed a golden age for first-time home buyers.
Then, everyone who sat on their down payment savings accounts for a few years too long will kick themselves for not taking advantage of what may turn out to be the buying opportunity of a lifetime for those who can qualify for a mortgage.
Unfortunately, we do not know when this golden age will begin, because we will be able to identify a bottom to the housing market only with the benefit of hindsight. But as it does with the stock market, the moment will probably arrive when everyone is feeling the most pessimistic.
That moment is certainly getting closer. Housing prices have fallen drastically from their peak levels in many areas of the country. Rates on 30-year fixed-rate mortgages are already close to 5.5 percent, and this week there were suggestions that the federal government might try to drive them down to 4.5 percent, a truly incredible figure to be able to lock in for three decades.
Meanwhile, first-time home buyers have the same advantage they have always had, which is that they do not have to sell their old place before buying a new one. That is an added advantage in areas where many available houses simply are not moving, because the people trying to sell them will not be bidding against you.
If you’re hoping for a recovery in the housing market, you ought to be cheering on the first-time home buyers. When they purchase homes, their sellers are free to move on or move up, stimulating further sales.
But if you are a potential first-time buyer yourself, or lending or giving the down payment to one, you are probably as frightened as you are tempted by all the “For Sale” signs that have become “On Sale” signs. So let’s quickly review some of the still-grim pricing data in certain areas — and consider the reasoning offered up by first-time buyers who have forged ahead anyhow.
As is always the case with real estate, much depends on location. One study, “The Changing Prospects for Building Home Equity,” tries to predict where today’s first-time buyers in the 100 biggest metropolitan areas may actually have less home equity by 2012 as a result of continued price declines. The verdict was that buyers in 33 of the markets could see a decline by 2012, including potential six-figure drops on an average home in the New York City, Los Angeles, San Francisco and Seattle metropolitan areas.
This is obviously scary. (I’ve linked to the study, a joint effort of the Center for Economic and Policy Research and the National Low Income Housing Coalition, from the version of this article at nytimes.com/yourmoney.) It’s worth noting, however, that these predictions came before the government made its most recent move to reduce borrowing costs.
Also, the price projections in the study are based, in part, on the fact that the ratio of purchase prices to annual rents is still higher in many areas than the historical average, which is roughly 15 times rents. While past figures may well have some predictive value, I have never been convinced that first-time buyers compare a home that they could own and one that they would rent in purely or even primarily economic terms.
When Jaime and Michael Proman moved this fall to Minneapolis, his hometown, from New York City, they craved a different sort of life after two years together in a 450-square-foot studio apartment. “We didn’t want a sterile apartment feel,” said Mr. Proman, who is 28 (his wife is 26). “We wanted something that was permanent and very much a reflection of us.”
The fact is, in many parts of the country there are few if any attractive rentals for people looking to put down roots and enjoy the sort of amenities they may spot on cable television home improvement shows. Comparing a rental with a place that you may own seems almost pointless in these situations, especially for those who are now grown up enough to want to make their own decisions about décor without consulting the landlord.
Still, for anyone feeling the urge to buy, a number of practical considerations have changed in the last year or two. The basics are back, like spending no more than 28 percent of your pretax income on mortgage payments, taxes and insurance. Even if a lender does not hold you to this when you go in for preapproval, you should hold yourself to it.
You will also want to start now on any project to improve your credit score because it may take several months to get it above the 720 level that qualifies you for many of the best mortgage rates.
John Ulzheimer, president of consumer education for credit.com, a consumer credit information and application site, suggests starting to pay down and put away credit cards months before you apply for a loan. That is because the credit scoring system could penalize you if you use a lot of credit each month, even if you always pay in full. Also, check your three credit reports (it’s free) at annualcreditreport.com and dispute errors.
While no one can easily predict the likelihood of losing a job, Friday’s startling unemployment figures suggest the need for caution if you think you might be vulnerable. A. C. Panella, who teaches communications at Pasadena City College in California, waited until she had a tenure-track job before buying a home in the Highland Park section of Los Angeles with her partner, Amy Goldman, a lawyer for a nonprofit organization. “We could afford the mortgage payment on one salary, were something to come up,” Ms. Panella, 31, said. “It’s really about being able to stay within our means.”
For many first-time home buyers, that philosophy stretches to the down payment, too. Ms. Panella and her partner put down 20 percent when they bought their home in September, as did the Promans when they bought their home in the Lowry Hill neighborhood of Minneapolis.
Alison Nowak, 29, put just 3 percent down on a Federal Housing Administration-backed loan last month when she and her partner, Lacey Mamak, bought a $149,900, 800-square-foot home several miles south of where the Promans live. “Anything that is an opportunity also has a bit of risk,” she said. Her house was in foreclosure before a plumber bought it and fixed it up. “One way we mitigated it was that we bought a really tiny house in a very good neighborhood.”
One other strategy might be to buy new instead of used. Ian Shepherdson, chief United States economist for the research firm High Frequency Economics, says he believes that a steep drop-off in inventory of new homes is coming soon, thanks to a rapid decrease in home builder activity.
Since prices generally soften in the winter, it may make sense to start looking seriously once the mercury bottoms out. “If you look at new developments next spring, you may not have the choice you thought you would have or be in the bargaining position you thought you would be,” Mr. Shepherdson said. Also, if you wait after June 30, you will miss out on a $7,500 federal tax credit for income-eligible first-time home buyers that works like an interest-free loan.
Finally, allow yourself to consider how it would feel if you bought and then prices dropped another 10 or 15 percent. It might not bother you if you plan to stick around. Plenty of people seem to be making a longer commitment to their homes. According to a survey that the National Association of Realtors released last month, typical first-time buyers plan to stay in their home 10 years, up from 7 last year.
Perhaps people are more aware that they will not be able to build equity as rapidly as others did in the real estate boom. Or they simply have more confidence in hard, hometown assets now than in other markets.
“We wouldn’t let another decline bother us,” said Michael Proman. “You can never time a bottom. This is a long-term investment for us, and it truly is the best investment we have in our portfolio right now.”
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