LOOK! Good News!

…According to the University of
Michigan “Entrepreneurial Cities Index
Report”, six Michigan communities
shared top rankings for attracting
and retaining entrepreneurial companies.
They are Auburn Hills, Plymouth
Township, Southfield, Troy, Tecumseh
and Dundee.

Moratorium on Foreclosures

Moffett and Allison, the new CEOS of Fannie Mae and Freddie Mac, have announced a moratorium on foreclosures of occupied homes until early 2009. It's hard to say how many people will be helped by that, but it's good to see an effort being made to help homeowners. Fannie Mae and Freddie Mac are also looking at other approaches to help save people's homes. There's to be a streamlined modification program coming out in mid-December that should expedite mortgage modifications for those whose mortgages have changed from a low rate to some exorbitantly high interest rate.

This is something I'll be watching, for if it helps homeowners, it helps the real estate market which will help our entire economy, and that's a good thing!!!

Are You Missing Something with the New Homeowner Tax Credit?

I hear people scoffing at the new first-time homebuyer tax credit, saying it's nothing more than a loan. It's called a credit because you obtain it as a credit when filing taxes. It does also have to be repaid so it seems more like a loan. However don't throw out the baby with the bathwater! Take a moment to look at the benefit. . .
When most first-time buyers leave the closing table, they have little left in savings. And as new homeowners, they are now confronted with a mortgage payment that exceeds what they were paying in rent. They have a home to furnish, with more rooms to fill with furniture than their apartment in most cases. They may also need to spend money on painting, carpeting and window coverings. Plus, there are other home ownership necessities such as a lawn mower, ladder, etc. that must be purchased, not to mention the possibility of repairs or improvements the home may need.
More often than not these purchases are made with a charge card, with interest rates ranging from 12% to 19%. These additional monthly expenses for home-related purchases are in addition to the large monthly mortgage payment they now have. So why wouldn’t a buyer be excited about obtaining the $7,500 tax credit, and having the benefit of repaying it over 15 years without interest?
What if a first-time buyer really liked a home they saw that needed some major repairs or renovation, a home that represented a great buying opportunity? But after much consideration, they decided against buying it. They just didn’t have the financial resources after the closing to accomplish the type of repairs required, such as a new furnace or new roof or new siding or new windows. Wouldn’t the opportunity to obtain $7,500 in an income tax refund possibly be the answer to this type of concern?

Financing Not So Easy!

I ran into a financing snag today! My client qualifies for an FHA loan with 3% down (gift money from a relative) but neither Uptown Village nor Meadowbrook qualify for FHA loans. And that's where the homes are the client likes best. Next we tried for a rural development loan - I've sold several homes in Milan with that financing which is great and zero down! But the income limit for a couple is $70,700 and my client is a little over that.

The 4th loan officer I spoke to today at least was encouraging --- my client will have to wait until mid-January at which time the loan limit for rural development loans is increasing and then my client will be able to buy with -0- down! Fortunately time is not of the essence and the wait until mid-January is not so bad.

There are some really amazing buys in Milan right now. Any first-time buyer or any buy-up buyer or any investor should be seriously looking at homes right now. Prices aren't going up for some time yet, but inventory levels are shrinking all over the county as the low-priced homes get bought up. If you're a buyer, this is the perfect time to buy! Call me at 734-439-8405 if you would like to talk about real estate. Barbara

What Is the Bottom?

How to identify the bottom of the market -- I found this article so well-written that I did not wish to try to re-cap, so this is quoted from RISMedia Daily E-Mail News:

"The trick is identifying the bounce and when to buy a specific property. For me as an investor looking to maximize profits, the price of a specific property is at rock bottom when the return on investment is better if I buy the property than if I leave my money where it is. Compare the real estate rental income and positive cash flow to the other investment options we all have, i.e.: stocks, bonds, savings accounts, etc. As real estate prices come down, and consequently the mortgage payments and taxes come down, while at the same time the demand for rentals is growing, at some point the positive cash flow will make the investment irresistible. That is the bottom for an investor.

With the scenario I have just describe each individual property is a micro-market of its own. The only thing that matters is its return on investment. You must only consider how you will benefit from that specific property. You must ignore everybody else and their investments. What we see now in hind sight is that many people paid too much when they invested like the masses in a sellers market. Remember, for you to win somebody else has to lose. Because so many people are losing so much of their equity it makes your ability to win much easier in a buyers market like we are in right now.

In a stable market, real estate prices are not driven up by investors. Home owners should be the predominant driving force. When a renter sees that their rent is higher than what they would be paying if they were to buy a similar property the tenants tend to once again convert to homeowners. That is the bottom for tenants. We know not all tenant have what it takes (income, savings and credit) to secure the American Dream of homeownership consequently there will always be tenants and they will always need investors like us to provide them with a home.

It has been years since we have seen prices low enough that we could invest in nice properties in great locations that yield an attractive positive cash flow. I got tired of hearing, “I remember when I could” or “I should have bought them all when I had the chance”. Now you can. You have a second chance. It may be your last chance. Take advantage of it."

About the author: Rick Harper grew up in the real estate business. He is a multi-million dollar real estate investor, and invests in commercial, residential and land. He has developed a strategy to acquire real estate with financing and then get it paid off to enjoy the pure cash flow. He is a broker, national speaker and investment consultant.

Family Matters

Family and Home are at the very core of my existence. I get some of my greatest pleasures in spending time with my family, in particular with the younger ones as the sweet granddaughter in this photo or my weekend camping trip with grandsons. Your family matters to me also which is why I take such pleasure in getting buyers into homes, whether it's your first home or fifth.

Call me (734-439-8405) for your real estate needs - I'll take good care of you and your family whether you are buying or selling a home.

Need to Get Rid of Good Stuff???

I often deal with clients who are selling their home of many years and they have lots of good stuff to give away but can't always find someone to take the items. The curb is often a good and simple option if you have useful smaller items like a lamp or bedtable or bike. Put these things out on a dry day, just one day before your trash pickup and they are likely to be salvaged by someone. I love this system of recycling!

Here are some other resources:
Friends in Deed at 734-484-7607 They were recently willing to take mattresses and bedding which is very hard to give away and not wise to put out on the curb.
Purple heart at 734-728-4560
Dawn Farms at 734-485-8725
Dr.Raymond Molano at 734-429-2737 who I've heard will take clothes (often hard to find someone to take)
Salvation Army at 734-668-8353 or 734-761-7750

Definitely call these contacts to verify that they are still willing to take items as at times they may get overloaded or have to discontinue. But go ahead and clean out those closets even before you get to the busy time of a big move!

Need any other help with your move? Do call me at 734-439-8405. I've lots of resources for all the moving issues!