Archive for March 2009
President Barack Obama signed a bill into law Wednesday that permanently prohibits banks from entering the real estate brokerage and management business…. Read more
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Tips to get your residential and commercial tenants to go green
0 Comments | Posted by DSteele227 in The Green Blog
· Kick off recycling with a tenant education party. Cook food in solar-powered ovens and hand out reusable water bottles. Get kids involved by offering cash or prizes for cans.
· Tell tenants the impact of their recycling efforts with updates in community newsletters. Lisa Lunger, manager of real estate services at the Colorado Housing and Finance Authority, estimates that a 200-unit property with three occupants per unit creates 3,000 pounds of trash a day. With 50 percent resident participation in recycling, that amount drops to approximately 1,500 pounds.
· Make it easy for residents to participate by positioning recycling containers in common areas such as laundry rooms and mailrooms.
· Reduce water consumption with faucet aerators and low-flow toilets and showerheads—a relatively inexpensive idea with a big impact.
Tips Source: Realtor Magazine February 2009, contributed by Lisa Lunger, manager of real estate services, Colorado Housing and Finance Authority, Denver
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Massachusetts to give grants for ‘green’ jobs
0 Comments | Posted by DSteele227 in Geo Blog
BOSTON – Massachusetts Energy and Environmental Affairs Secretary Ian Bowles announced last week that clean-energy companies, community-based nonprofits, educational institutions and labor organizations are among those eligible for $1 million in “green collar” job training grants.
The grants are available through Bowles’ department’s Pathways out of Poverty Program, which was created when Gov. Deval L. Patrick signed the Massachusetts Green Jobs Act in August. The money is intended to jump-start training in clean-energy careers for low- and moderate-income residents.
Bowles said Energy and Environmental Affairs will award five grants, ranging from $100,000 to $300,000 each, to programs that serve workers with incomes at or below 300 percent of the federal poverty level. The grants will target programs in the “Gateway Communities” of Brockton, Fall River, Fitchburg, Haverhill, Holyoke, Lawrence, Lowell, New Bedford, Pittsfield, Springfield and Worcester – former mill cities that continue to provide first homes and first jobs for new immigrants.
Grant applications are due to the department by Jan. 15, for programs that are expected to begin in February and last through June 2010.
Source: Posted Dec 13, 2008
Providence Business News
Housing Stimulus Package Update:
National Association of Realtors asked for the following in November, 2008:
- Raise loan limits in high cost areas.
- Make the $7,500 tax credit NOT a loan.
- Find ways to push interest rates down.
- Provide help to foreclosure and short sale problems.
What was achieved?
- Loan limits will be raised to $727,000 in high cost areas.
- Tax credit will be raised to $8,000 with NO payback feature.
- Interest rates have come down 125-150 basis points.
- $50 billion in the stimulus bill is set aside for foreclosure mitigation. Troubled Asset Relief Program and Tax Analysis and Revenue Forecasting will be used to mitigate foreclosures through a government guarantee, drive down interest rates by purchasing another $200-$300 billion of mortgage paper from Government Sponsored Enterprises (Fannie Mae, Freddie Mac and Federal Home Loan Banks) thereby freeing them up to do the same with new mortgages.
- Fannie Mae has agreed to raise the cap on investment properties eligible for loans from 4 to 10.
What we keep:
- Mortgage interest deductibility, real estate tax deductibility, and the $250,000/$500,000 cap gains exclusion (an overall package worth more than $100 billion and for some a very attractive funding source for their pet projects).
What we did not get:
- Tax credit $15,000
- Homebuilders credit $22,000 as well as 5 year loss carry-back deal.
Although, we cannot complain over the loss of something we never had in the first place.
Pending Home Sales Show Healthy Gain
Despite the uncertain housing market “pending” home sales increased compared to the previous month as more buyers took advantage of low home prices, improved mortgage rates and affordability. The biggest gains were in South and Midwest, and areas with the biggest improvements in affordability. However, the market is still weak and in need of a significant housing stimulus and mortgage availability for qualified buyer. For an economic recovery and sustainability it is proposed to increase the mortgage limits, expand the $7500 tax credit to all home buyers and extend until end of 2009 along with removing the repayment feature and add liquidity to the mortgage market by directing the funds from the Troubled Asset Relief Program.
Keep Banks and Real Estate Separate
Efforts are being put forth to disallow large national banks to engage in real estate brokerage and related services which clearly causes conflict of interest, restricts consumer choice and competition among mortgage lenders.
S&P: Housing Won’t Pick Up Until 2010
According to a forecast by Standard & Poor’s year 2009 may be worse than 2008 however will recover in 2010. The reduction in home inventory will help the rebound which is currently at 10.4 months (30 months in some sunbelt states) compared to 6 months during stronger markets. Following is necessary for a healthier market:
1.Buyers must have confidence in their jobs and income levels.
2. Housing prices must stop declining.
3. Housing must be affordable in relation to income.
4. Buyers must have access to low-interest mortgages.
5. Home owners must be able to sell their homes in order to buy a new one.
The Busiest Rental Web Sites
According to Realty DataTrust, maker of Vaultware software that facilitates online search reported that in addition to Craigslist these are the top 10 website for rental search in terms of most traffic: 1)Rent.com 2)4walls.us 3)ForRent.com 4)ApartmentGuide.com 5) Apartments.com 6)Washington Post’s ApartmentShowcase.com 7)Apartmenthomeliving.com 
Move.com 9)MyNewPlace.com 10)ApartmentSearch.com
Government Struggles to Keep Interest Rates Low
As interest rates declined more home owners refinanced increasing the supply of mortgage bonds along with the expanded borrowing by the government to pay for stimulus packages have caused an increase in the interest rates.
How to Find Money to Invest in Real Estate
David Gass, founder of Business Credit Services of Las Vegas, proposes the following ideas to find funds or investors for real estate ventures:
1. Prepare financial documentation outlining the details of the plan including: Time, money and equity you have already invested in the project, potential Income, amount to be invested moving forward, profit and loss statement considering the expenditures such as maintenance, repairs, property taxes and advertisement.
2. Speak to a local bank as they understand the business, area and are interested in investing in the community
3. Private investors and angel investor networks with the assistance of an attorney for security and assurance.
The Rich Are Tanking Too
The recession and instability in today’s housing market has also affected the high end and luxury homes that were typically not influenced as much in the past downturns. If investing in this segment of the market consider the following:
- Jumbo Loan defaults are 3 times higher than regular conforming loans.
- Number of buyers for pricey homes are decreasing as the economy weaken.
- Wealthy areas have been hit hard areas such as California, Nevada and New York have seen the biggest drops.
- From 1995 – 2005 The top 1 percent of wealthiest Americans doubled their mortgage and residential debt to $494 billion.
Rise of ‘A La Carte’ Real Estate
American Homeowners Foundation and American Homeowners Grassroots Alliance President Bruce Hahn says home buyers and sellers will look to a la carte real estate services in the future, which will spawn numerous niche markets. He anticipates growing tension between big and small realty firms with regard to the new business models, and he says trade groups will look to accommodate the needs of members in different niches. However, Hahn says associations could seem to favor more dominant member segments, and he believes this already is occurring with large franchises with traditional business models. Hahn believes that small, independent brokerages and those adopting new business models need to take on the bigger players in the industry, which he says would eliminate possible antitrust violations and benefit consumers.
Credit Troubles Slow Commercial Market
There are plenty of properties and deals available on the market however; banks are only lending 60% to 70% of the value of construction projects compared to 80% the norm in the past. Some professionals suggest to keep to hold on to good tenants as difficult to attain, reduce the rents to help if facing financial difficulties perhaps adding a clause in the lease to share the tenants increased revenues upon recovery. They also suggest that the green industry is the next big thing.
New Rules Can Make Getting a Mortgage Trickier
Some banks including JP Morgan Chase are discontinuing whole sale lending to offer loans directly through their branches to control cost, as well as bundle profitable services like checking and savings accounts. These practices are slowing down the application process and increasing turnaround time of a loan closing to as much as 60 days.
Fannie, Freddie Plan to Limit Evictions
Fannie Mae and Freddie Mac has extended freeze on eviction of renters in properties facing foreclosures. Also, announcing plans to develop new rent-to-own options after defaults including:
-Month-to-month leases for borrowers and renters
-Hire property management companies to determine market value rents.
-Ask tenants and homeowners to demonstrate re-payment.
According to Freddie Mac’s CEO :”Keeping foreclosed properties occupied and in better repair will support local property values and promote a faster recovery in the housing market,” David Moffett, Freddie Mac’s chief executive officer, .
Obama Promises More Low-Cost Mortgages
President Barack Obama announced significant efforts to improve the economy by lowering mortgage costs. According to analyst this is an essential move and will help stabilize the economy and boost new construction. Many American are outraged over the bonuses being paid to the executives while people are losing their homes thus efforts to directed towards stabilizing the housing market will help boost the morale.
