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With the constant barrage of negative media surrounding real estate these days, it’s no wonder that newlyweds and other first-time home buyers are putting their dreams of buying their first home on hold. But 2008 promises to be as good a time as any to buy your first home and here’s why:

It’s a buyer’s market

With foreclosures adding houses to a market already hungry for buyers and economists predicting that residential housing sales and prices will not pick up until 2009, sellers who need to sell are lowering prices and often throwing in additional incentives.

Perfect timing is rarely achieved

Although you should educate yourself and use caution when buying into a declining market, a buyer waiting for prices to hit absolute bottom, usually waits too long and then pays the cost of buying into a rising market with increased home prices. If you’re planning on staying put for a while, now is a great time to buy your first home because the market will eventually balance itself and turn once again to a seller’s market and when it does, your home’s value will increase too.

Interest rates are low

Recent Federal Reserve decisions have lowered interest rates yet again making the Federal funds rate drop to 2.25% (down from 5.25% a year ago) and the prime rate drop to 5.25%. And today a Bankrate.com index showed that the national overnight average for a 30-year, fixed-rate mortgage is being offered at 5.74% and a 15-year fixed at 5.09%, both of which are buyer-friendly rates.

Labor and materials are readily available

Even if you don’t qualify for enough financing to buy the home of your dreams due to tightening lending practices, it’s easier than ever to fix-up and maintain properties with the number of home improvement stores, tips, do it yourself classes and handymen readily available. And because new construction has slowed down in most markets and all trades that depend on it are eager for employment, buyers are likely to get better work, done faster and maybe a little cheaper in 2008 than at anytime in the future.  

A need to sell makes sellers flexible

Remember, sellers who don’t need to sell right now generally don’t have their properties for sale. And those who do need to sell tend to be more flexible in negotiations, so buyers should consider proposing terms that ask sellers to help make the deal work beyond just lowering their price. Sellers may have the ability to finance part of the purchase price to make it easier on the buyer, they may be able to fix or replace something that needs updating, and they can always pay more than the customary share of closing costs and taxes.

 

Happy House Hunting!! 🙂

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Green is the new black during this, the final weekend of the 2008 Parade of Homes Spring PreviewSM presented by Builders Association of the Twin Cities’ members.

This year’s Guidebook includes plenty of great Green articles to help us make sense of this growing movement and the homes in this year’s 14-home earth-friendly mini tour are built to showcase Green building practices, products and design, and many of them will host education seminars and other interesting events to give home buyers a better understanding of their Green options.  

Some of the seminars that are taking place this weekend include: “Landscaping for a Green Community”, “Light up Your Home AND Your Energy Bill” and “Geothermal Heating and Cooling: A Systems Approach.” And I’m thinking about checking out an event with eco-friendly design expert, Jackie Kanthak, who will be will answering questions, giving green design ideas, and offering advice on the the hard to find eco-friendly products for the kitchen and bathroom.

Green or not, the homes on parade cover a broad spectrum of prices to fit the needs of every buyer, ranging from the lowest priced home by S.W. Wold Townhomes, Inc. in Cambridge, priced at $119,900, to the most expensive home by Stonewood LLC, located on Loring Drive in Minnetrista and priced at $2,950,000.

So come on out this weekend to take advantage of the longer days and beautiful spring weather that’s rolled our way, and peruse the preview parade!

For more information go to http://www.paradeofhomes.org.

Happy house hunting!!! 🙂

:: Kelly ::

Greetings everyone!

I wanted to take a moment and introduce myself. My name is Kelly Carlson, Marketing Manager for the Don Edam Group, and I’m going to be contributing to this blog (and to the real estate industry in general) in the days to come, from a completely new and different perspective than your typical real estate professional.

Hoping to utilize a trifecta of my favorite hobbies (trend hunting, exploring new places, and trying new things), as well as tapping back into the service journalism and editorial voice that my U of M education once afforded me, my intentions are to keep you posted on all the latest news, statistics, tips, and trends in real estate and to scope out and share with you all of the food and dining, shopping and style, arts and entertainment, health, education, and local events that make our Twin Cities neighborhoods unique and fabulous places to live!

Although I am relatively new as a licensed real estate agent, I’m excited to know that the combination my background, work and educational experience, and personal interests can lend something new to the industry. While my expertise (& nearly a decade of experience!) lies primarily in promotions, marketing, and trend research, I also have 2 years experience as a credit analyst for a local mortgage services company and 4 years experience in title insurance research, giving me a range of knowledge and skill that can only add to our clients’ success.

I get a kick out of being a social anthropologist and spotting changes in consumer behavior, scoping out new trendsetting products and services, and just about any super-smart thinking on where our societies are headed at large. I look forward to developing new and innovative ways of marketing your homes and neighborhoods so that others can see why you called it “home” for so long, and I hope you enjoy the information I can share with you about the people, places, and events that form our great Twin Cities communities.

In the meantime, happy house hunting and speedy sales to all! )

Kelly

We’ve been quiet for a little while over here while we work on redesigning our blog and attempting to improve content. Helping me do that is our Marketing Manager, Kelly Carlson. Kelly will start to become a frequent contributor to this blog. I feel she’ll do a great job and should be able to comment on many things that I don’t have the expertise in. So, please welcome Kelly to the site!

Also, be on the lookout for a redesigned site in the next couple weeks. As always, you’re comments are greatly appreciated.

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U.S foreclosure filings continued their upward climb in December, rising 97% from the previous year and 7% from the month before. Total foreclosures rose 75% in all of 2007.

According to MSN Real Estate’s latest report, hardest-hit markets were along both coasts, which experienced a more severe boom and bust in the latest cycle, as well as areas hard hit by auto-industry layoffs such as Michigan and Indiana.

The surge in foreclosures is expected to continue at this same pace until after the next wave of risky loans resets in the middle of 2008.

2007 foreclosure filings by state

Rate Rank

State Name

Total # of filings

% chng. from 2006

% chng. from 2005

Total # of properties

%Households

1

Nevada

66,316

215.12

758.68

34,417

3.376

2

Florida

279,325

123.96

129.25

165,291

2.002

3

Michigan

136,205

68.32

282.22

87,210

1.947

4

California

481,392

237.99

681.95

249,513

1.921

5

Colorado

71,149

29.96

140.12

39,403

1.919

6

Ohio

153,196

87.93

207.35

89,979

1.797

7

Georgia

99,578

31.07

118.43

59,057

1.566

8

Arizona

69,970

150.91

160.7

38,568

1.516

9

Illinois

90,782

25.29

94.3

64,310

1.25

10

Indiana

52,930

11.31

73.57

27,980

1.027

11

Tennessee

45,834

24.56

65.66

25,914

0.983

12

Texas

149,703

-4.57

9.22

84,469

0.936

13

Missouri

32,022

80.93

176.74

23,492

0.906

14

New Jersey

53,652

34.06

52.75

31,071

0.902

15

Utah

9,668

-25.87

-16.19

7,438

0.852

16

Connecticut

23,470

100.05*

111.38*

11,860

0.833

17

Maryland

25,109

455.26

388.41

18,879

0.83

18

North Carolina

37,426

66.52

135.07

29,101

0.739

19

Mass.

41,487

161.14

751.36

17,737

0.66

20

Idaho

6,032

140.51*

119.83*

3,640

0.611

21

Washington

23,705

27.95

59.47

15,184

0.573

22

Oregon

10,746

12.25

56.76

8,461

0.543

23

Oklahoma

13,594

-12.78

0.71

8,256

0.52

24

Virginia

24,199

456.3

728.73

16,307

0.514

25

Minnesota

13,615

127.11*

506.73*

11,557

0.513

26

Arkansas

14,310

26.44

23.58

6,406

0.513

27

New York

57,350

10.19

54.72

38,688

0.493

28

Alaska

1,650

54.64

17.69

1,332

0.486

29

Wisconsin

17,503

131.15*

241.79*

12,133

0.486

30

Nebraska

3,971

30.88

91.84

3,636

0.474

31

Rhode Island

3,241

153.80*

7804.88*

1,838

0.41

32

New Mexico

3,893

-26.04

-46.55

2,994

0.357

33

Iowa

7,404

114.92*

251.90*

4,103

0.314

34

Pennsylvania

34,089

-11.07

18.98

16,379

0.302

35

Kentucky

8,793

23.45

76.96

5,105

0.274

36

Montana

1,378

29.27

52.6

1,150

0.268

37

Alabama

7,903

81.76

83.07

5,572

0.268

38

Delaware

1,430

225.00*

342.72*

999

0.266

39

South Carolina

5,038

-27.56

-33.76

4,247

0.22

40

New Hampshire

N/A

N/A

N/A

1,238

0.212

41

Louisiana

7,331

151.58*

90.61

3,968

0.204

42

Kansas

4,978

20.85

161.31*

2,434

0.203

43

Hawaii

1,270

88.71

-60.39

966

0.197

44

Wyoming

497

21.52

99.6

356

0.151

45

Mississippi

1,997

91.65

4.55

1,409

0.114

46

North Dakota

308

74.01

86.67

250

0.082

47

West Virginia

1,135

30.31

10.95

460

0.053

48

Maine

N/A

N/A

N/A

286

0.042

49

Vermont

61

35.56

1.67

29

0.009

50

South Dakota

N/A

N/A

N/A

24

0.007

District of Columbia

800

607.96*

393.83*

777

0.28

U.S.

2,203,295

74.99

148.83

1,285,873

1.033

*Actual increase may not be as high due to improved or expanded data coverage in this state.

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According to the Center for Media Research and the BIGresearch Consumer Intentions & Actions Survey in February, over 8,000 consumers provided unique insights & identified opportunities in a fragmented and transitory marketplace. On the downside, only one in four (26.2%) are confident/very confident in chances for a strong economy in February, a five year low. A sinking housing market, credit collapse, and record prices at the pump provides the impetus for only half as many consumers holding high hopes for the future than in February 2007.

Consumers Anticipating a Strong Economy
Date % of Respondents
February 2003

30.8

February 2004

49.3

February 2005

47.7

February 2006

44.5

February 2007

53.2

February 2008

26.2

Source: BIGresearch, February 2008

On the upside, Phil Rist, Vice President of Strategy for BIGresearch, concludes that “Many Americans will be wisely using their rebate checks to save, spend, and pay down debt, so the overall result will be positive for the U.S. economy… some will splurge on big ticket items, many… will use the checks for important day-to-day purchases.”

While women will spend a larger percentage of their rebate check than men (42.2% vs. 38.7%), both genders will plan to set aside the same percentage for savings (18.7%) Young adults 18-24 will spend more of their checks (46.2%) than any other age group. And:

  • 30.3% contend they’ll save the money in their piggy banks
  • 25.4% will use it to pay down credit cards, while
  • 15.7% say they’ll pay down debt (installment loans)
  • 14.6% reveal that they’d purchase necessities with their checks, with 22.5% of those earning under $50,000 buying necessities 

And while 39.7% of those aged 18-24 are the most likely group to save their checks, 14.9% of this age bracket is the most likely to use their checks toward paying off student loans. 13.3% will buy apparel, and 11.2% expect to purchase electronics.

While confidence in the economy is plummeting, only two in five contend that they’ve become more practical in their purchases, down a point from January, and still on the rise from ’07.

50.4% of the respondents contend there will be “more” layoffs in the next six months, up from 41.5% in January and the highest reading since March ’03 (50.4%). While consumers foresee a dreary outlook for employment, it seems they have the “it’s not going to be me. 5.5% fear becoming laid off, up slightly from January’s 5.2%.

With pump prices rising to today’s average $2.972/gal (source: AAA), driver’s budgets are increasingly strained by additional fuel expenditures.  While 40.5% are attempting to cope by simply driving less, 35.3% say pump pressures have led them to reduce dining out and 33.6% decreasing vacation/travel/ 29.8% are spending less on clothing. while 22.4% are delaying a major purchase, such as a car or furniture

Seasonal demand for spring merchandise, such as Easter apparel and lawn & garden supplies, lifts the 90 Day Outlook from January, according to the BIGresearch Diffusion Index, but the current economic outlook is expected to put a damper on spending compared to February 2007.

Consumers aren’t as likely to be considering purchasing high-dollar durables in the next six months compared to last month and last year. Purchase intentions are down for computers, furniture, home appliances, housing, jewelry, DVD/VCR, and digital cameras…major home improvements and vacation travel flat from January (though still down from ’07), while TV remains flat from last month and rises from last year.

Six month purchase intentions for autos remain stable from last month at 11.8%. Among those planning to buy, 43.5% still plan to buy new, while 16.7% aren’t yet sure. The average price auto buyers are planning to spend has lowered from $21,150 in January to $19,830 this month.

For more from BIGresearch, please visit them here.

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