Bufford Warren Homes

A Thank You For All My Clients and Associates

 

2007 has been a year of joy and a year of disappointments. We have a housing market that presents many problems for us and some great opportunity for some that will call it a blessing.

I have made many new friends and hopefully have not lost many of the old ones. To my new ones welcome and for my old ones I give thank for the privileged of knowing and associating with them.

My internet family has grown and maybe some will read the blog that I started. I will do my best to keep them informed about the local real estate market and things on the national scene that affects them and their home investment.

THANK YOU FOR ALLOWING ME TO SERVE YOU

Bufford Warren

How Much Will the Arizona Affect Rental Property

The new Arizona Law that requires employers to check the legal status of their employees with the federal data base is going to affect many segments of our economy. As this effective date of this law approaches, the migrants are fleeing . The small contractor can no longer hire a person for seven or eight dollars per hour. The small manufacture is going to have a difficult time finding enough qualified employees to assemble their products. These are just a small indication of the economic impact that we are going to observe in our economy. When the people are not there to fill the jobs, they are not going to be there to purchase products. Home builders and contractors will take longer to complete jobs and there will be less production. We do not have enough young people to keep our economy producing without the immigrant. With the illegals leaving the state, there are going to be more rentals vacant. With investors having more of their units empty they will probably cut prices to sell them or abandon them for lender foreclosure.

My Thoughts On December 11th Fed Announcement

We are on the eve of the next Fed rate correction. Will they cut .25 basis points or will they cut more? It probably will make very little difference either way. They have a runaway economic train and they don't have a clue on how to stop it. The big problem is liquidity.

Each week the Fed comes out with the H8 report. This report shows the weekly change in assets and liabilities of commercial banks in the US. Closely watch commercial and industrial loans, real estate loans and consumer loans. Page one will give you the most important info about banks willingness to lend to borrowers that are willing to complete a transaction at today's are higher than normal lending rates.

It also measures the levels of bank holdings in Treasury securities as banks frequently purchase these bonds and notes with excess capital that is not needed for lending. On page one you will see a development in regards to bank balance sheets. In the last three months, US banks have liquidated over $71 billion of their safe Treasury securities and purchased over $210 billion of other securities. Banks have been forced to repurchase securities that they may have originated or guaranteed for a fee and now do not have the capital to make new loans to businesses that need working capital.

In the short term this will cause the Libor rate to stay at a high level due to the demand for commercial money. This in turn makes the interest rates on many of the ARM products more expensive.

The Fed's dilemma is that if they lower the reserve requirements so that banks have more money to lend they will then have problem with inflation. A little inflation may be the best way out of this situation. If no action is taken on the reserve requirements, a credit contraction could result in deflation.

 

Lenders Agree To A Five Year Interest Rate Freeze On ARM Loans

Associated Press has reported that a coalition of lenders, loan servicers and investors have agreed to a plan that would freeze interest rates on some subprime mortgage loans for a period of five years.

According to unnamed sources, borrowers with loans made between Jan. 1, 2005, through July 30 of this year who face interest rate resets between Jan. 1, 2008, and July 31, 2010, would be eligible for interest rate freeze.

An official announcement of the plan's details is scheduled for Thursday, AP reported.

   

  

Selling in Today’s Home Market

Our Real Estate market has many home sellers that are getting creative in marketing their houses. For many years sellers have offered help with closing costs and at times they have even gifted money for a down payment. Now we are seeing people giving the buyer's agent a bigger commission, advertising vacations, interest rate buy downs, cars etc. I even know of a seller offering a houseboat as a buyer's incentive. In Miami Florida came the report that a seller was offering a buyer a cash reward if they would purchase his home with no money down.

Homes are still being sold. The key is very much more pronounced now than in the past. The homes that sell within 90 days or less are PRICED AGRESSIVLY and in most cases staged very well. Take a good look at your home through the eyes of a buyer. What will make it stand out and be more attractive than the neighbors? Make a list of items to be repaired, replaced or removed. The objective is to make your home appear to be well maintained, spacious, clean and organized. The three places I like to focus on first are curb appeal, Kitchen and the back yard.

Start at the street. Curb appeal is the most important item in the sale of the home. The front yard should be neat and clean with all shrubbery pruned and grass mowed. The front entry should be neat and clean, refinish the door if necessary. If the home does not show well from the street, many potential buyers will just drive away without looking. If they don't come in they will not buy.

The kitchen should be neat and clean. No dishes in the sink, the counter tops clean and free of any clutter or utensils. Stove top and oven should be clean. The exhaust fan for the stove should be clean with no grease residue.

The back yard needs to be neat and as family friendly as possible. There should be at least a small patch of grass for kids and dogs.

How dark are the rooms, a home with a lot of light will show better? Pick up all clutter and clean off all counter tops. Is there too much furniture in a room making it appear crowded? Are the closets packed full? How about the garage. You might think about a garage sale or renting a storage unit. Open doors and windows to let in clean air and check for odors.