A customer sent me this article earlier. I get these all the time. It seems everyone is rating Austin on top of about every category there is. People are still moving here and I am seeing it picking up even more. Better hurry though as there are signs of prices rising in different areas. Builders are also busy now. That is one of the first signs that more people are willing to come into the market. The first time market is the slowest overall as the “0″ down programs are gone except in rural areas. Then you can use USDA. So since that is gone, that has eliminated a huge amount of buyers.

http://finance.yahoo.com/real-estate/article/107183/the-best-and-worst-cities-for-recession-recovery?mod=realestate-buy

I had posted recently on ways to be entertained on the cheap. I had said that I did sign up for Netflix and have the streaming option. Well, I thought it was great but sorta got tired of messing with the laptop to view shows. If this is your only option, it is worth it. Well worth it. I just bought the latest Samsung Blu Ray player that has built in wireless and streams N directly. I have to say, I am impressed and that is putting it mildly. I flip on the player which is the same brand as my tv. The tv comes on automatically. I can use both controls if I want. I tweaked the settings on it and it took me maybe 5 minutes to set up the wireless part. Same as using a laptop as far as programming that goes. Anyway, I just now turn it on and the screen comes up automatically that I can choose Pandora music streaming (which I haven’t set up yet) and Netflix. I select Netflix and it logs into my account and shows what shows I have in cue for streaming. The box does a great job. It also will stream in HD. They call it that but it isn’t quite HD but better than I expected. I have had no issues. I have read people complaining about juddering and bad connections. It really has a lot to do with your internet connection. Mine is very fast. This helps. Oh, if you are watching a show and you don’t want to finish, just stop. The next time you log in and choose that show, it starts in the same spot as you left off. Of if you choose you can go to the start again. It is like having a built in Tivo.

I can’t recommend this enough. I was up until 4:00 in the morning playing around with it the first night and one other night as it was fun flipping and watching shows. Just rememeber that  you must also use a computer. You go online with the computer and choose the shows to put in your cue. Then when you turn on your Blu Ray player, they show up automatically. When you first set it up, it will give you a code you must program in online. You go into your account and choose the streaming option and put in that code. After that, your player is set up. This should keep me busy for a while now.

Here is the latest news on the 8,000 tax credit. Remember, it really shouldn’t be called that is it is up to 8,000. Some people will not get that much. So do consult a tax person if you are unsure and banking on the full amount.

This article explains it all pretty well.

http://www.reuters.com/article/domesticNews/idUSTRE54S3KE20090529

This is a topic I have written about before. Really the Green catchword I find comical. Why? Well putting a word to saving energy is a marketing thing. I think a genius came up with it, as no one could know it could be such a huge growing industry. Now saying this, “Green” is nothing new. We are seeing more eco friendly products but if you look back, you will find that that so called “Green” products have been around for many, many years. I sold a house 15 years ago with solar panels on the roof. When I built my home in 1994, I added R-38 insulation, tyvek wrap on the outside, plastic wrap on the walls, expanding foam anywhere there could be a breach to the outside. I did 12 seer a/c. No one was doing that then. Was I thinking “Green”? No. It was about saving on utilities and what made sense. I was thinking long term. It hasn’t been long that that a/c systems just went to 14 SEER. So I was way ahead of the pack. I didn’t do several things as I thought they were not cost effective at the time. Like foil backing on the roof decking. I wish I had of done that and I was asked at the time. I did the foam sheathing on the outside of my home behind the brick. I did double pane windows. I upgraded those windows recently to the Low E. Huge difference in the heat being blocked from certain rooms! Anyway, my point is don’t get caught up in the hype. Just research and do what makes sense.

I watch a lot of HGTV. It is so funny to see people who constantly ask about new home construction, “Is this Green?” We want a green home! Most really don’t know what it means but they have the money to spend and are willing to spend the extra. To give you an idea how popular the idea is, most builders who are building on strictly “Green” principles as a marketing tool are broke in the Austin area. With a bad economy, people just won’t pay the extra.

You see a lot of these green homes having MDF instead of wood. That is ecofriendly. Wrong! You had better research as a lot of it is made with formaldehyde and leech toxic fumes. You would be surprised to find out how many builders no longer use wood for baseboards in their homes. Saving the enviroment? No. Saving money for themselves as MDF is cheaper to buy. You pay the price. While there might be some manufactured without formaldehyde, you had better ask. Also hardwoods. Some coatings are toxic. Even the glues. Do you think they care? Most don’t and don’t even know. There are just now educational courses on the topic. I am seeing a few here and there. So while it is good to make an effort to be eco friendly, please get your priorities in order. Don’t try to be trendy. Do it because it makes sense. If that load of special wood you are using came from overseas, the cost of shipping the materials alone in both time and energy are probably not worth it. Buy local and close by is the rule. While that is not always easy, if you are serious, you have to rely on yourselves for research. So called experts I am finding are good in some areas and not good in others. There is lots of false information floating around.

So the next time you see buyers saying they want “Green” on HGTV, just smile. Know they just helped to market some products for many companies. Some good, some bad. I also will say I am not an expert. I have almost 20 years in the Real Estate industry and have watched a lot of homes being built. I have studied and keep up with trends and am right on a lot of them. Eco friendly is here to stay, but don’t be so quick to jump on the bandwagon just for the feel good or bragging rights. In the end it is about saving money which in turn does a small part to help save the enviroment.

Last is Organic products. Beware. There have been many companies use the label that aren’t really organic or can technically be called organic. This is something I will save for another topic. I will say though, that as a family we do buy a lot of organic goods but we are picky about what we do buy. You don’t do this to save money though so it isn’t like being “Green” with your home and lifestyle. It is a health choice.

Face it, we are all pretty much spoiled. Talk of saving money is something we just don’t like to hear. Even though we know we should. Saving money can be both entertaining and just plain fun! So how can you keep the family entertained with a tight economy on everyones mind?

Here are a few ways. And yes, I do them all myself.

1. Outdoor projects: Gardening

Putting in new flower beds at your home and sprucing your landscaping up doesn’t have to cost a fortune. I cover my plants in the winter and manage to save the majority of the. This year, I planted lots of new flowers. Unfortunately the hail storm did a number on quite a few of them. They are now coming back and looking good. I also planted more. I have really a lot of landscaping in both the front and back yards. You might again, think… well it cost money to buy plants. Yes but I was able to do what I have on around 150.00 this year. In about a month everyting should be in strong and the pleasure it gives is much more than the money I spent. It was a lot of work and I maintain the beds as a form of therapy. It just makes me feel good. Now if you really want to save, in the winter start planting seeds in treys. You can spend very very little and have tons of plants come summer. All for a few dollars. Plus the gratification to know you were able to accomplish this is a huge reward. I dug up 2 crepe mrytle (probably spelled ths wrong) plants out of my flower bed that grew in wild. I did this about 2 years ago. I put them in my side yard and now they are around 8-10 feet tall. They are healthy and beautiful. To my surprise, one of them has white flowers. I don’t have one with white flowers! Mine are pink and sorta purple colored.

We also have tried planting pecans that the squirrels bury. We get them every year and I am not sure where the pecans come from. Anyway, last year I found one and put it in a pot. It survived the winter and now is  about a foot tall and thriving. I plan on putting it in the yard soon. I love the idea of knowing this tree cost me nothing and will hopefully give the squirrels a huge rate of return plus my family.

2. Movies – Netflix

We were members of Hollywood Video for probably 3 or 4 years. Well this year they got the bright idea to change the plans which means we had to pay more and are limited on how many movies we can rent. Well it took me one week in their new trial program to know it was a loser and we canceled. I signed up for Netflix and we love it so far. It got off to a rocky start with our first movie being lost. Another was cracked. This is common I hear. Really the movies you receive aren’t the best part of their service. I have my laptop hooked up to my tv. Netflix has unlimited streaming of movies. Not all are online. I have read there are 16,000 tv episodes and movies online. So if you can’t find something to wach you are too picky. So for 13.99 a month, you can get new releases via the mail plus unlimited streaming movies via the internet. This is the best entertainment value ever!

3. Books – So think books are too expensive? How about the library? How about online books? If you go to google.books.com, you can find something interesting to read. They have thousands of non-copyrighted books (mostly older) on file. All free!

I am a huge fan of the local library. To me it is amazing the amount of people who tell me they have never been, or ask where a local library is. That is just one thing your taxes are paying for so use it and enjoy it. They have story time for the kids and all sorts of activities. I have written about the enjoyment my family gets from the library before. Also one other thing about the library. By joining texshare at the Library, you can go to any library and check out. Also if there is a certain book you want, you can get the library to do an interlibrary loan for you. You just pay the postage which I think is 2 dollars. So that 20.00 book you have been wanting to read can be available to you for only 2 dollars. Now that is a deal. Plus you can add books to a want list at the library. I do that often and in most cases, they order then for me. So take advantage of what your taxes are providing for you.

4. Parks – Head out to a park, fly a kite, run, swim. You can do all sorts of things. In most cases they are free to only costing a few dollars. (for things such as swimming)

5. Movies – Think movies are too expensive? If you go at certain times you can save a lot of money. Plus there are movies at the Cedar Park Milburn Park. It is free. This is a great family activity. Sitting under the stars and watching a movie. It doesn’t get any better than that.

These are just a few things. So when the thought crosses your mind that you don’t have any extra money and are feeling bad as you can’t do anything. Think again! There is more to do than you can possibly ever do. Explore options and enjoy yourselves!

I admit I am a news hound. I read everything. Today that isn’t such a good idea as you can get depressed quick. I do get a chuckle though every once in a while when I see how the media treats the economy and how people are faring though it. Here is an article I read this morning on Cnn.com.

Man it is funny what some people think of as being rich! Read this guys article. He said he is humbled now having to ask for a job. He was once this rich guy driving expensive cars and wearing expensive suits.

“It took a lot for me to put that ad on Craigslist, because I had to change what I was before,” he said, breaking down in tears. “I wasn’t this rich little yuppie anymore, driving expensive cars, having expensive suits. I’m in this just like everybody else looking for work. It humbles you. This is real.”

So he lost his job and said he as rich. It said after 4 months of looking for a job, he moved in with his mother. Now if you were rich, would you only be able to last 4 months without income? This shows how people are living on credit and beyond their means. Then the article goes on to say he made a whopping 70,000 a year! Thats it! Now that isn’t a bad income but you can’t live in a fancy house, drive fancy cars and take expensive vacations, making that. That today is considered a modest income. The news is just putting too many of these types of articles up and wanting people to feel sorry for them. I don’t fell sorry for this guy at all! He was probably living like someone making 250,000 a year on a 70,000 income. He will be fist in line for some government assistance.

I feel sorry for people who save and lived within their means and now are losing their 401k retirement accounts because of the decline. I feel sorry for older people feeling the pinch every day. I feel sorry for kids who won’t be able to afford to go to college now. I can go on and on. This guy though, I don’t feel sorry for.

http://www.cnn.com/2009/LIVING/03/12/craigslist.economy/index.html

Well the headlines are saying what everyone knew they would say. Here is how a job market normally thrives and is Rex’s common sense, anyone can understand explanation of what is happening now. The economy typically grows and with that,  jobs are created. It has been a fairly long cycle with few interruptions along the way. I knew that students would have a problem getting  jobs and have been saying this for a few years now. Is it because the cycle of growth is broken and new jobs haven’t been created? Yes, this is one part. Is it because jobs have been lost so there are diminished opportunities? Yes. Now here is something that isn’t talked about much and that is point #3. Every year there will be people retiring from their jobs and therefore new job openings are created that need to be filled. With 401k accounts in half right now, you do you think most of these people will still retire? I don’t think so. So there is another avenue of jobs opportunities that are cut off from college graduates.

I remember a few years ago when I first moved to Austin. I was young and went to HEB our local grocery store chain and asked to put in a job application as I had worked in grocery stores through High School and liked it. Well I was told there were tons of applications already for the one job. The manager doing the interviewing was nice. He told me things were tough. At that time we were having lots of job losses and layoffs due to the economy. He said they had an IBM engineer bagging groceries because he could find no other job. He said, yeah we know he will leave when he finds something else, but he is good and reliable for now. He said this is the market now. I was sorta shocked. I wasn’t too hard up for a job so had other things I could do.

My point is now, things are totally different. There is fear out there that wasn’t around before. No amount of Stimulus can cure that. It will take time and gradual growth. One good thing coming out of all of this is people are saving like never before. The Government though says this is a bad thing. Yeah if people are saving, they are not spending. I think there will be an upside to that also. If people save, when they do buy, they will start to pay cash more. I think people are getting tired of being dependent on credit cards. It is too easy to charge as it is “outa sight, outa mind” sorta attitude. It is very easy to turn over a credit card with little to no thought and purchase something. We all need to learn to wait until we can afford something before we buy. If you are buying a home for example, pay a bigger down payment. You will be glad you did later.

I have also been saying for years that the drawback to the internet is that it is so convenient. HUH? Sounds contridictory doesn’t it? Well, because it is so convenient, you can go online sometimes with no intent to purchase anything and you run across a bargain you just can’t do without. You put in the ole charge card and now you wait on the UPS man to come. So easy! Too easy! Just think before you do this next time.

This is the extent of my thoughts today. I know I have talked multiple times about credit and saving. At least I am glad to see people are saving money. They will need it for later as the economy isn’t going to get better for a while. No one knows when. You can still live a good life and enjoy it though. Having no debt makes life a whole lot better.

I just read a report this morning about home prices across the country. It seems that Texas has survived the price drop overall. Texas home prices reported to be up in the 4th quarter around 2 percent. Austin on the other hand showed to have risen 4.4%. Some might think this is impossible due to slowing sales. Well here is something to think about. This is my take.

Remember that “0″ down loans were pretty much gotten rid of in the 3rd and 4th quarters. Well if you take the first time buyers out of the mix that were going “0″ down, then that means less lower priced homes were sold. We already know that sales numbers for homes are down. So if unit sales are down but prices are up, this is probably the main factor. Plus loan programs got tighter and who does that effect the most? First time home buyers which again means lower priced homes. It is only common sense that the other homes sold in a higher price range will bring the average up.

That is my take. It isn’t what the article hinted at of course. They just gave facts, which were true. You just have to dig a little deeper and get the whole truth. So this being said, we are still lucky here that our prices and sales have not be effected as much as the rest of the country. Yeah sales are off quite a bit. We are all feeling that in the Real Estate community. But it could be worse. I figure if we made it this far, hopefully when things do turn around, we will have the strongest market in the country as people will want to move to an area not subject to the huge price declines.

I can’t even imagine being a Real Estate agent in many parts of the country now. Especially California. The prices there are taking a beating but rightly so in a lot of the cases. Some, are beaten down too much. I have said it before. When you buy a home like in some areas in Florida that gained 50% to 100% in some cases in only 2-3 years, you are in for a world of hurt if you held on. This is not natural and not a smart move to buy into a market like this. A lot of people are complaining that their homes have lost value but what they are not telling you is that 400k home they bought for 250k just 3 years ago, is now worth 250-300k now. So really they haven’t lost anything. I know this isn’t all cases, so don’t scold me on my comments. I had a stock account that lost 8,000 and now I am going to lose 2,500 of my original investment from 3 years ago. So can I say I lost 8,000? I can but the reality is I am losing my gain and then the 2,500 of my initial investment. I am not happy about that but at least my original investment didn’t get beaten up too bad.

Well that’s all for today.

Well it looks like the stimulus for homebuyers is going to happen. It is 8,000 instead of 15,000. Still 8,000 can make the difference with first time homebuyers big time.

Instead of me going over it all,  click here to view an article giving more details. It can be confusing and I am sure more will be coming out on it soon. There are income limitations which probably won’t be an issue in most cases. Hopefully this will get more people off the fence as it is like buying a home at a discount. If you qualify for the entire 8,000 that is not a bad discount.

(Update: after I posted this, I read that you have to have the money to close up front on the home then you get it later. This will be a major issue as a lot of the buyers won’t be able to do that)

Home prices across the nation are still showing a decline. News reports said today that the worst hit area was Ft Myers Florida with a 50.8% price plunge in 2008. You might think this is bad and rightly so. Here is one thing to consider about a lot of these areas. The prices there shot up a huge b just 3-4 years ago. I mean huge. Maybe not in Ft Myers so much but in say Panama City or Tampa and other coastal cities. I saw lots there that could be bought 10 years ago for 10,000 going for 200,000 just 5 years later. Well prices do go up, but…. Some of the prices doubled on houses in only 2 years. A lot of these people are crying now that they have lost so much of their value.

Look at it this way. (this is just one angle) You buy a house for 200,000 and 2 years later the market drove it to 400,000. Now prices are dropping and your home is worth 300,000. Shouldn’t people be estactic??? Here in the Austin area if you home goes up 5% a year we think that is unbelievable. Some areas of course did go up more but the prices were depressed to start with. You can still buy homes in the surrounding areas of Austin for prices they sold for 5-7 years ago. I know this for a fact as I have sold them. Some areas have been flat and others have went up. So the bottom line is our prices here have not had the huge jumps. So hopefully we have less room to fall.

Now back to other cities. I talked to a customer who was moving to Austin or rather wanted to. This was last year. He told me that he was asking 410,000 for his home. It sounded like a nice home in a nice area in Orlando Florida. He said it had been slow and he had dropped the price to 410,000. He said though he is not going to give his house away or he will stay. I asked him how long he had lived there and he said a little over 2 years. He bought it new. I asked him if he was losing money and he said no, he paid 200,000 for it. I said then how 2 years later can you expect to double your money? He said, people were doing it and if someone wants mine bad enough they will pay. The market then keep in mind was much better than it is today. I said, well you might as well forget moving as it is unreasonable to think your home can double in value in 2 years. Those days are gone. Sure on paper they did and a few were able to sell at the high when there was a feeding frenzy going on. Dumb people to pay those prices I think. Yeah you might get mad at me saying that. If you did your homework and you found home prices doubled in 2 years I think it is wise to lease as that is not a sustainable market. California is finding that out. Which brings me to another point.

If you watch tv or follow the market at all, you know prices that were in some of these California cities. They were just crazy high and in my opinion are still too high in most of the areas. Supply and demand. My question is how in the world are these people getting loans to buy these average homes for 600-800,000.00? You see them on house buyers on HGTV. (old shows probably) I see young couples starting out saying their budget is 550 or 600k.I think, how in the world can you even get a loan. Are you guys making 250,000 a year or more? No I doubt that very seriously. If you look at the top income earners, you can’t tell me they all live in California.  I see why the loan companies are in the toilet right now. Giving loans to people who shouldn’t be even buying a home was just plain old crazy. I can’t be convinced that all of those people in those areas can afford to buy starter homes for 450k and up. And I mean some tiny little cracker boxes of a house. I am not knocking what anyone can afford but to me if you have to live in a 2 bedroom 1 bath fixer upper for 450k or more (for example) I think it is wiser to lease. Rents are a much better deal. Yeah you heard that from a Realtor. In some markets it is better to lease.

In the Austin area rents are really low right now. Prices have not dropped and sellers overall are not willing to make huge price drops. So they are leasing their homes until the market rebounds some. This can be a smart thing to do but you are banking on the market improving. It could go the other way. Our market seems to be more stable now that it has been the past 3 or 4 months. This is encouraging. I am just thankful that we didn’t see the huge price drops that other harder hit areas have experienced. And California and Florida people, don’t think I am picking on you. You just gave me a great way to illustrate examples of what is happening.

If you are in California and Florida and Michigan, things are not going to get better anytime soon. Remember this… No matter what the press says, until the consumer starts to feel good enough about the economy to start spending again, it is impossible for the economy to improve. We are a consumption driven economy. All economies are. When you see consumption going up, you will know there is light at the end of the tunnel. Not all is doom and gloom. My best advice is this is a good time to buy if you are planning on staying put for a few years. You can never know the bottom. Some areas have a long ways to go down still. Others have already been down longer than others so may be getting closer to a bottom. Follow your heart and study up. I have been at this for over 19 years now. Sure I do it for a living but I am debt free and not worried about the market. It comes and goes. Be careful of taking advice of someone who is worried about where they are going to get the next commission to pay their bills.  When you have money pressures, it can create an influence that might not have your best interests at heart. There are a lot of good agents out there so don’t think their aren’t. I am seeing a lot of questionable ones coming out of the wood work though. (hearing and seeing things happen) Also be very careful and never buy a home sight unseen! We have investors who came in here and bought hundreds if not thousands of properties and a lot of them never even knew exactly what they were buying. This I find amazing! I could never do that but the customer sets the tone. As an agent you offer your opinion.

I have rambled long enough and got off topic. Save your money, pay a bigger down payment and enjoy your new home if you decide to buy. The larger down payment you can pay the better. Having a paid for home is a feeling like no other and the more you pay the closer you will be to that end result.