I was excited about a recent article on Physorg.com that showed how today’s U.S. college students are more focused on achievement than power.  This is a very significant trend and could be the beginning of a new generation with different priorities and goals.  This generation could be more innovative and successful especially in an ever increasing global world.

Maybe it’s the horror stories of abusing CEOs in the media, less than ethical politicians over the news that are finally waking up a new generation.  After all, achievements are very important and power is usual a residual effect of being perceived as powerless.  In other words, one of the reasons power hungry individuals seek power is because of bad self image.  Often time ethics fly out of the window when trying to secure a power position.   I think it was a famous 1960′s psychiatrist that said power attracts psychotics.

Click here to view the article.

Choosing between traditional real-estate brokers and a discount ones can be confusing. Some buyers and sellers turn to discount brokers but both have to do much of the work in finding or selling a home an agent would normally do.

The numbers show that homes sold by agents usually spend less time on the market and fetch a higher price.  Plus, and this is in my eyes the biggest and most important factor, an agent should help you avoid the pitfalls of negotiating contracts and should spot out problems that could arise later on.  After all, it is their jobs and they have not only studied transactions well, they negotiate them very often and know what to look for.

I’m not one to get scared and cry foul when another business model comes up.  Fifteen years ago I was teaching English as a second language which involved books and maybe video tapes.  Then came the revolution, computers, cd-roms, etc.  Many cried foul and doom-sayers called for teachers to be replaced by machines but it never happened.  Students are still taught by real human beings, however, teachers are using more pedagogical supports such as cd-roms, interactive systems, etc.  I embraced the new technology and adapted my personal style to it with success.

However real estate consumers need to be careful when choosing between a full service and a fractional service for discounted price.  There is no free lunch and everyone still needs to make a living. Buyers wanting a break from the commission earned by selling agent should understand what they are asking for. Would you, in your line of work freely forgo part of your salary for less work?  They should also understand the conditions attached to discounted services and make clear when viewing homes that they are represented by an agent. Obviously sellers using flat-fee listing services find buyer’s agents shun their homes as there are less incentives.  It is also a problem of  image as most people see agents pocketing a lot of money for very little work.  If you factor how the commission is split between both agents, then brokers, then add the advertising, gas, insurance, etc, you can see the agent does the foot work for you.

All in all, different systems for different people.  If you can trust yourself to do the foot work, analyze the market, understand the trends, know how to read contracts and spot out the eventual problems in transaction, homes, and lastly if you have enough time on your hands, than some discounted systems might work for you.  However, if you have little time, are not comfortable with signing a contract for half million dollar to above homes then hiring an agent will save you money and time.

The Mortgage Bankers Association (MBA) reported a decrease of 31.0 % since one year earlier.   The refinance mortgage activity also decreased to 35.3 % from the previous week. It didn’t quote from a year ago.

That means the rates have gone up and might go up more to control inflation while the volume of applications for mortgages and refinancing is dwindling.

Click here to read more on the subject.

There isn’t much worthy of news today on the real estate front asides from the stock of houses on the market rising but less houses are being sold.  And of course, with the Federal Reserve set to meet, "experts" are predicting another interest hike, which seems likely.  I guess it’s very hard to read through the lines.  On one hand, you have the specialized media trying to paint a rosy picture of the market and other media are less optimistic.  There is a lot of conflicting information also as one will quote lower numbers one month and another publication will quote higher numbers.

One thing is for sure, it is in a state of flux.

One study caught my eyes and found 39% of U.S. homes are at risk to be extremely overvalued.  Nothing new here when I found that California and Florida accounted for 17 of the top 20 overvalued markets.  Out of 317 markets, College Station, Texas, was undervalued by about 24%, Dallas and Fort Worth were undervalued by 19%, Houston by 16%, New Orleans by 12% and San Antonio by 11%.  So you know where some people will move to now.

The 10 most overvalued U.S. home markets:

    1. Naples, Fla.
    2. Salinas, Calif.
    3. Port St. Lucie, Fla.
    4. Merced, Calif.
    5. Bend, Ore.
    6. Stockton, Calif.
    7. Punta Gorda, Fla.
    8. Santa Barbara, Calif.
    9. Madera, Calif.
    10. Riverside, San Bernardino, Calif.

Click here to read the original article.

Less buyers and rising home inventories is making selling a new science at finding what the right price.  It’s no secrete that buyers can now afford to be choosy.  Sellers are starting to lower their expectations as we have seen new houses coming on the market with much more realistic prices in the area.

According to Lauren Baier Kim at the Real Estate Journal, there are a few things you can do to help sell your home.  The most important is to understand your local market.  Go and see homes for sale and what buyers are paying.  There is no easy way to set the right price in today’s market but understanding your local market and pricing your house attractively will attract passage and that is crucial to finding the right buyers.  Overpriced homes are quickly dismissed.   Many homeowners still believe they can get last year’s prices but that is increasingly harder to do.  Often enough we see sellers turning down prices and months later lower their home to that same price, so entertain all offers.  Negotiate with your buyer, make them feel you are listening to their questions and willing to work with them.   Finding agents with an artistic flair for home design is a very important selling key for your home.  Presenting your home in the best attractive manner will bring many buyers.

Like in stock trading, it’s hard to know when it’s time to take a loss and move on.  I have Tom Lydon of Global Trends Investments and their amazing ETF blog, ETF Trends to thank for some simple points that has paid off very well for his clients.  You set a buy and sell price NO MATTER what the market does, you stick to it.  It’s the same in real estate. The last sold homes in your neighborhood the last week or so is where the market is now. Depending on how motivated you are, price your home even lower.  After all, you probably have already made a great profit over the years.

Though Lauren talks about lowering commissions, I am not convinced as I feel this directly influences the motivation of the agent to have your home advertised and sold quickly.  Agents will put more work for a higher commission.  You pay for what you the quality you get.

Here is the original article.  http://www.realestatejournal.com/buysell/tactics/20060615-kim.html?refresh=on

On Friday I tried stopping receiving spam from Charter.  A year ago I subscribed to Charter’s Internet cable service which became a disservice as the hidden gotcha caught me off guard, I don’t have TV and therefore my $30 a month jumped to $50.  Not worth it when Verizon offers $40.

I still receive unsolicited mailings after 9 months of asking to be removed and finally got our names off yet we still receive the generic and highly frustrating "current resident".

According to two clueless automatons, yes its harsh, nothing could be done about removing that service.  They even quoted obscure laws that gave them the right to spam me.  Funnily, most other companies I dealt with, even Verizon stopped sending me these spam.  Charter obviously doesn’t care about its image or how annoying it gets.  Funny enough, this could change very soon when finally the state steps in to open our cable competition.  Maybe then, Charter will think annoying people isn’t the best way to gain new business.

Climbing interest rates, less speculative demand is changing the real estate market, and Harvard’s Joint Center for Housing Studies believes there will be a soft landing.  It concluded that without severe overbuilding or big job losses in major metropolitan areas will be an important factor in shaping the market.

Strangely enough, one in ten homeowners face higher mortgage payments this year according to the report.  I heard many people speculating on how foreclosures would be the norm with higher rates, but it doesn’t look like it.  It will be a stretch though for those who left little margin to their finances.  Let’s hope salaries rise this year.

But high appreciation rates make housing more difficult and we saw this in the early 90′s as the Feds were pushing up the rates to keep inflation under control.  Slow wage growth that don’t keep pace with rising housing costs will be a major aspect of the industry.  Already close to 15% of homeowners spend around half of their income on their homes.  The study showed a renewal of rental demand, with vacancy rates falling.  Not a good sign for renters and I am sure landlords will have no problems exploiting this. 

So obviously we are still in a major adjustment period of the market.  Buyers are more than ever aware of what they are purchasing and sellers still want to make enough of a profit.  But what is enough of a profit?

Here is the original article.