By Kevin G. Hall

RISMEDIA, February 3, 2009-(MCT)-The U.S. economy contracted 3.8% in the final three months of last year-the biggest such shrinkage in almost 27 years-as a deepening recession gripped the nation, the government reported Friday.

As bad as that number was, mainstream economists had been expecting a much bigger contraction, and Wall Street cheered. All three stock indices opened in positive territory in early trading after two days of steep losses.

That cheer may be short-lived, as there are numerous signs-including some in the Commerce Department’s report Friday on the gross domestic product-that suggest that the nation’s economic conditions are deteriorating further and faster.

“Although the decline in GDP was the largest contraction since the first quarter of 1982, the outturn was not nearly as bad as the 5.5 percent plunge that the market consensus forecast had anticipated,” Jay Bryson, a global economist with the Charlotte, N.C.-based national bank Wachovia, wrote in a note to investors. “Is it time to break out the champagne and start celebrating the incipient economic recovery? Hardly.”

Although Friday’s report showed a contraction, the growth numbers were padded by a buildup of inventory at businesses. This number was down $30 billion from July through September, but turned positive by more than $6 billion in the fourth quarter.

It means this: Goods that built up on store shelves and warehouses, because customers are effectively on a buyer’s strike, are counted toward growth. They masked a deeper decline in economic activity. When inventories are subtracted from the equation, the contraction in growth was 5.1%, the low end of the dismal range that economists had expected.

“The increase in inventories means that growth in the current quarter will be worse than previously expected; probably closer to negative 5 percent. The worst of the downturn wasn’t in our past, it is in our future,” said Mark Zandi, chief economist for forecaster Moody’s Economy.com in West Chester, Pa.

The fourth quarter declines follow a 0.5% contraction in the third quarter of 2008. The National Bureau of Economic Research has said that the U.S. economy entered a recession in December 2007.

In a statement, the chairman of the White House Council of Economic Advisers, Christina Romer, said that the even-larger contraction when inventory buildup was subtracted pointed to a recession that was worsening.

“The large decline confirms the evidence from other indicators, such as payroll employment and the unemployment rate, that the U.S. economy continues to contract severely,” she said. “Aggressive, well-designed fiscal stimulus is critical to reversing this severe decline and putting the economy on the road to recovery and improved long-run growth.”

The House of Representatives has passed an economic stimulus bill that’s worth more than $819 billion, and the Senate begins voting on its version this week. Congressional leaders in both parties have promised to send a stimulus bill to President Barack Obama by mid-February.

Other signs of further trouble were deeper in the GDP data released Friday.

“The decline in motor vehicle output was particularly severe, accounting for 2.0 percentage points of the overall fall in GDP of 3.8 percent. This widespread decline emphasizes that the problems that began in our housing and financial sector have spread to nearly all areas of the economy,” Romer said. “Immediate action to support both the financial sector and overall demand is essential.”

Also deep in the data was a sign of how the rising tide of global trade is receding in a global slowdown, dampening what had been one of the few bright spots last year in a sagging economy.

“As if to rub salt in the wound, gross exports plunged nearly 20 percent, a byproduct of recession in most foreign countries,” Bryson, of Wachovia, said in his research note.

It’s hard to see any light at the end of the tunnel. This week brought more than 80,000 job cuts announced at major U.S. corporations such as Home Depot, Microsoft, Caterpillar and other brand-name companies. The Labor Department reported Thursday that more than 4.7 million Americans have drawn jobless benefits for a week or longer, the highest amount since such recordkeeping began in 1967.

Another 588,000 Americans sought first-time jobless benefits for the week that ended Jan. 17, suggesting that January’s job losses probably will exceed half a million for the fourth consecutive month.

© 2009, McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Read more real estate headlines on RISMedia.com:

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• With No Room to Cut Rates, Fed Looks to Other Remedies

By George W. Mantor

RISMEDIA, February 3, 2009-Whether you represent the buyer or the seller, you want to use your knowledge and expertise to prevent your transaction from failing to close. Numerous factors contribute to the failure of a contract between buyer and seller of real estate. Financing, possession dates, disclosures, due diligence, inspections, pre-closing contingencies, local market conditions, appraisal reports, ability and competence of the practitioners assisting the clients, change in either party’s personal circumstances, as well as property and neighborhood issues are among the more common contributors to a cancellation.

An all-cash offer, scheduled to close ASAP, that waives all inspections, is pretty likely to close. The maximum leveraged offer, contingent on financing, from self-employed itinerant hod carriers, scheduled to close in 120 days, attached to a sheaf of pre-closing contingencies, in a declining neighborhood with numerous drive-by shootings-not so much.

And, in the case of new home sales, the same property might cancel several times.

For this reason, it is hard to get a baseline on which to set expectations. However, having worked in both large real estate organizations, franchises, and on MLS committees, it seems that given a large volume of transactions, over a period long enough to have been subject to all types of market conditions, about 25% of all contracts fail. Smaller firms with more seasoned agents tended to close about 90% of their written contracts.

That would seem to me, particularly in this market, a very worthwhile and challenging goal. Sure, one philosophy says if you throw a certain amount up onto the wall that some of it has got to stick, but I think that idea is so yesterday. No matter how much business you do, even a single cancellation takes a certain emotional toll. Better to use that psychic energy working toward more certain transactions than pushing a rock up a hill.

Many failed transactions never should have been written in the first place. But others, too many others, could have been saved by a little advanced planning.

People in our business are perennial optimists. We have to be now more than ever. But, when it comes to anything that could be torpedoed by one of “Murphy’s Laws”, as professionals, it is our duty to assume that all may not go well and prepare accordingly.

Dealing with Uncertainty

From my observations, it appears that our greatest obstacle in this market is uncertainty. Some people are in danger of losing their jobs and, as we are seeing, there is a sort of trickle down effect. This is on people’s minds whether they think they will be touched by it or not.

There is uncertainty about value. Who wants to pay more for something if they could have saved substantial money by waiting a few months, or even weeks? And, whether we want to admit it or not, there is uncertainty about our very system.

The mainstream media continues to bombard the public with a steady stream of negativity. If it bleeds it leads, they say. We must counteract that by providing factual information. The first step in building a solid foundation for closing is the initial consultation. Again, whether buyer or seller, they need to understand the bigger picture.

Elements of an initial consultation include the following:

Needs analysis

Beyond the client’s interest in either buying or selling real estate are circumstances that are vital to the success of your closing. We need to understand their motivation and their mood. Start with a simple and disarming question, “Why are you considering making a move at this time?”

By the way, there are only a finite number of answers to that question but this, and not the real estate transaction, is the real need seeking to be met. Buying or selling real estate may not be the solution to the underlying need. If it isn’t, you’ve got one strike against closing.

Recently, I did a CMA for an urban loft. There were several others listed within the building and a couple at distressed prices. Coming to market under those circumstances, isn’t likely to arrive at a fast sale. The why was to cash-in. I advised her to wait. I know many practitioners who would take that listing. Unless the seller is willing to price at market, there are too many other choices. Taking an overpriced listing in a crowded and declining market is hardly a recipe for success.

The bigger picture

Every generation faces challenges. The great depression, sandwiched between two world wars, impacted three decades of my father’s life. But, people had families and still needed a roof over their heads. To succeed in our business, we must be able, when appropriate, to assuage people’s apprehensions about their future.

Despite the news of the moment, there is a predictable future. We are a growing and shifting nation. In the directions we are moving, there is inadequate developed real estate to support the job growth underlying the migration. For individuals, buying property in the ten growing regions, called “Megapolitans,” the future is relatively certain.

Investors are active in the market. Not speculators, but investors. Why? Because they know demographics and there is no competition. The best value is obtained when you are the only buyer

Demographics

Some of the most important work in analyzing future job growth and corresponding migration patterns was done by Robert E. Lang, director of the Metropolitan Institute and associate professor of Urban Affairs and Planning at Virginia Tech. Lang, working with data from the Census Bureau supported, in part, by the Brookings Institute, has identified what will be the most dramatic socio-economic shift in our nation’s history.

In the last three centuries, we have constructed more than 300 billion square feet of homes, offices, stores and factories. Lang notes that it will take just 25 years to build the next 200 billion square feet. Get ready for the mother of all booms.

According to the Lincoln Institute of Land Policy, “Megapolitan areas extend into 35 states, contain less than one-fifth of all land in the lower 48 states, but captured more than two-thirds of total U.S. population.”

CNN Money calls it “The $25 trillion land grab…” and “…a treasure map of opportunity.” Strong words for a media outlet with little expressed affection toward real estate as an investment.

Local market conditions

Buyers look into the marketplace and observe and endless sea of houses. Sellers see only one. Both must fully understand the breadth and depth of what is available, as well as the general nature of the local economy. This provides a great opportunity to discuss the MLS, how it works, the number of properties on the market, and the process of elimination.

Paperwork Review

This is the best time to present the contract, disclosures, and forms that will comprise the closing process. Most people aren’t able to absorb a lot of details while under the stress of making one of the biggest decisions of their lives.
Demonstrating the paperwork and explaining the role of each item will make it much easier for them to commit when the time comes. They won’t feel like they need to pour over all those documents before pulling the trigger. If you provide them with draft copies, they can have an opportunity to review them at their leisure and highlight anything they are uncertain about. Covering the paperwork is a great segue into the next item.

Closing process step by step

Many people become disenchanted by all of the steps and people involved in the closing process. By one estimate, there could be as many as thirty separate individuals involved; everything from the bugman to the notary. Each has a job to do and a contribution to make to the closing process. We do not always control either the demeanor or performance of many of these people and some we do not even meet.

We need to prepare our clients by providing them with a breakdown of all the players, what they do, why they do it, and when it will occur.

Milestones

Every transaction has key points. Loan approval, inspections, appraisal, title review, and pest clearance are likely milestones. Make sure the client understands the importance of these events.

Communication

Keep them in the loop. With the availability of online transaction and escrow tracking, there is a great opportunity to bring the client right into the process.

Pre-arrange communication by discussing it in the initial consultation. Don’t assume it. Ask, “When I do need to communicate with you, what is the best method to reach you?”

By thinking forward and preparing the client for the inevitable ups and downs of a real estate transaction, you can be confident that you are closing every possible transaction.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

By Cristina Bolling

RISMEDIA, February 3, 2009-(MCT)-With the economy and housing market in a slump, some growing families are making do with the space they’ve got instead of moving to a bigger home. That means their kids may start doing something that kids don’t do much these days: share a room.But experts say some simple tricks can make shared bedrooms a happy place where children can express their individuality while fostering tight bonds with their siblings.

“I think it teaches children to be thankful for what they have, and realize you don’t need your own everything” said Laura Brown-Willingham, whose three children, ages 9, 8 and 6, share a room in the family’s 800-square-foot cedar cabin in Davidson, N.C.

Design and organization consultants had lots to say about designing fun, functional rooms for two or more. Traditional bunk beds are great space savers, but look into other bed configurations as well.

Cornelius, N.C.-based interior designer Kelly Cruz is partial to an L-shaped bunk bed configuration that consists of an elevated bed against a wall with a single bed below it extending out at a right angle. The configuration allows half of the space below the elevated bed to be used for storage or a dresser.

Regular loft beds allow room underneath for play space, a desk or a dresser, depending on the child’s needs.

But parents should make sure their children are old enough for bunk beds. Experts say most kids probably aren’t ready until at least 5 or 6.

If the children are a bit older and care about privacy-especially if one is a boy and the other a girl-consider installing draw drapes between their beds, says Charlotte, N.C., interior designer Leslie Williams. Installing the curtains is easy using a track system on the ceiling, Williams says. (Think hospital rooms.) Even a gauzy fabric that allows light to pass through will give the feeling of privacy, she says.

Another way to create a separate zone for each child is to place an open bookcase in the middle of the room as a room divider. Having “yours,” “mine,” and “our” space helps kids feel they have their own piece of a room, Williams says.

Color and Fabric

Kids are bound to have different tastes in colors and patterns, so don’t insist on buying matching comforters. Instead, Williams says, pick an “inspiration fabric” that has colors both children like.

Use the agreed-upon fabric for items like curtains and bed skirts, but have each of them pick a favorite color in the fabric and use it for their bedspreads and other personal room decor items like bulletin boards, lampshades, or dresser and desk accessories.

Pick a paint color or two from the common fabric and keep it simple by painting the room one color. Or, in the case of bunk beds, consider dividing the room horizontally where the top bunk meets the bottom and paint the bottom half of the room one color, the top half the other color.

Keep furniture simple. Don’t overwhelm a crowded room with too many patterns and clutter. “You want to keep it very basic, with neutral main pieces of furniture so the room can be changed as the kids grow,” says Sherrie Le Masurier, a decorating consultant and co-owner of the website www.decorating-kids-rooms.net. “Don’t go out and buy a Barbie dresser. Go neutral, and keep your furniture staples really basic. Let the personality come out with the accessories.”

Character-themed sheets or even a lampshade or wastebasket are fine, Le Masurier, says, because they can be cheaply and easily changed when the children move on to other interests. Getting rid of the dollhouse-shaped bookshelves or Dora lamps, however, won’t be quite as easy.

Make your furniture have multiple uses. A bench should have storage space inside. Bedside tables should contain bookshelves or drawers.

Charlotte Observer parenting columnist Betsy Flagler says putting kids in the same room can breed close-knit relationships between siblings.

“Parents don’t need to apologize for having siblings share bedrooms. I think younger children especially prefer cozier homes than huge, rambling houses with a thousand square feet per person,” says Flagler of Davidson.

The Willinghams hadn’t intended such tight quarters, but when dad Christopher lost his job about three years ago, the family moved from a 2,400 square-foot house into the cabin they once leased to renters.

Mom Laura acknowledges that space is tight-she salivates over the prospect of having two bathrooms again-but she says she’ll always opt for a cozy cottage over a cavernous mansion.

Big homes mean “huge upkeep,” she says. “I’d rather have a bigger barn with animals in it than a huge house.”

Togetherness tips:

- Keep it simple. Fewer pieces of furniture and cleaner lines will make a small room seem less crowded.
- If your kids are old enough, bunk or loft beds are a great way to save space.
- Don’t over-”theme” the room. It will get quickly dated and you’ll end up replacing pieces more quickly.
- Get creative with color, even if two kids have opposite tastes.
- For older kids, consider ways to give each child a little privacy.

These websites offer tips on decorating kids’ rooms:

www.decorating-kids-rooms.net.
www.bhg.com/decorating/kids-rooms.
www.hgtv.com/topics/kids-bedrooms/index.html.

© 2009, The Charlotte Observer (Charlotte, N.C.).
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

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By Jenny Shearer

RISMEDIA, February 3, 2009-(MCT)-Guadalupe and Ariana Sanchez represent hope in the housing market. The 28-year-old couple with four children just bought their first home.

“We got it pretty cheap. Right now is the best time to buy,” said Guadalupe Sanchez, a carpenter.

Sanchez toured 20 homes, bid on four, and landed a deal with a three-bedroom, two-bath house on Sherman Avenue in southwest, Bakersfield, California for $160,000.

“I told my wife, we’re just throwing our money away by renting. Let’s try to get a house,” he said.

Low home prices and low interest rates-coupled with inventory agents say that they’re quickly moving-are positive news for Bakersfield’s real estate market.

For example, Ken Carter, president of Watson Touchstone ERA, said his agents sold 241 homes in December, a 56% increase from the 154 transactions in December 2007.

About half of the 241 sales were foreclosures, Carter said.

Bakersfield has “a big pile of properties that we have to work through, those properties that are in some state of default,” Carter said, adding the market “can’t be in great health until we work through those. The good news is we’re working through those at a record pace.”

Homes are moving every day, and buyers have choices. Friday morning, for example, 3,636 properties in Kern County-single-family homes, condos, mobile and manufactured-were marketed on the Multiple Listing Service, according to the Bakersfield Association of Realtors. Of those 3,636, there were 1,402 bank-owned properties and 1,126 were short sales, in which a lender accepts offers that are less than what a home is worth.

A Time for Investors

Real estate investor Mike Pope took a hiatus from buying in 2006 but returned to it last June. He looks for homes with solid structures in neighborhoods that could benefit from revitalization.

In June, he paid about $110,000 for a home on Teresa Court, near Pacheco Road and Hughes Lane, that last sold for $235,000 in 2005.

“It had graffiti inside and outside you would not believe,” Pope, 55, said of the bank-owned house that needed new doors and windows.

Here’s what Pope did: He spent $23,000 on materials for improvements and did most of the work himself. He has a tenant who wants to buy the house for about $180,000.

“My biggest reward on the one on Teresa (Court) is getting to know the neighbors. They would keep an eye on the house; I would have them over to see the progress,” said Pope, who is on medical disability from a teaching job.

The Cycles of Real Estate

Those ready to buy may even be outbid on good buys as home prices approach pre-boom levels.

“What we have found in the association is that many of our membership are saying they’re having a competitive bidding scenario again on some of these homes that are coming into the inventory … that are REOs,” said Nance Fillmore of Fillmore Realty and Financial Services. She’s the president of the local Realtors Association.

Real estate experiences peak-trough cycles that take about eight years to 10 years to complete, said Mark Carrington, director of sales and support for First American CoreLogic, a Santa Ana-based real estate data firm.

It typically takes three years to four years for home values to decline, and six to seven for them to increase.

Home values peaked in July 2006, and “‘07, ‘08 and ‘09 is the drop,” Carrington said.

“So far right now, we’re acting just like any other cycle has happened. It’s a deeper, steeper drop than we’ve experienced in a long time, (but) the timeframe is pretty average so far.”

Prices are down now, a benefit for buyers.

“That is of course an effect of the foreclosed properties that are pervasive in our market,” Fillmore said. “If the homeowners can ride out this period of time, it will go back to a normal appreciation that we’ve experienced for many, many years in the past.”

What About Current Owners?

Certainly, some homeowners were in over their heads, or got there after a job loss or illness.

“A person loses his or her home because some type of trigger happens that is overwhelming,” Carrington said.

Fillmore urges those who have trouble making payments to consult their lenders and take advantage of programs such as the federal government’s Hope for Homeowners.

Last year, Warren Ash, broker at Bakersfield Realty Group, handled about 330 bank-owned properties.

“I’ve been told by more than one company to expect my inventory from that company to double or even triple in 2009,” he said.

The industry is also watching the impact of option adjustable-rate mortgages, popular from 2003-06, which allowed borrowers to make minimum payments, paying less than both the principal and the interest that was owed. Homeowners could choose to make small, medium or large payments.

It seemed like a great idea when home values kept increasing.

“That five-year period for most of those loans is going to peak in 2010,” Carrington said, adding modifications and refinancing may be available to help some folks keep their homes.

Copyright © 2009, The Bakersfield Californian
Distributed by McClatchy-Tribune Information Services.

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By Jim Wasserman

RISMEDIA, February 2, 2009-(MCT)-When California state employee Tim McManus peers into the future, he sees 4.5% interest.

“I’m hoping it will go down more. One more drop,” says the Sacramento homeowner with a first mortgage at 6% and a second at 7.75%.

Sacramento’s Debbie Fernandez has already locked in at 4.875%. That will knock $300 a month off payments for a house she bought in Houston in October.

The rate then was 6.25%.

But Fernandez, a nurse, is still shopping.

“I hope we can do better.”

Roseville, Calif., tech worker Robert Gage is also waiting for the right moment to refinance.

“I can get 4.5 percent for two points,” he said. “I’m hoping for 4.75 percent with no points. That’s what my goal is.”

As 2009 opens, the “refi” chase is on in neighborhoods across the country.

This new suburban sport was launched by mortgage rates that in recent weeks have fallen to lows not seen in almost four decades. Thirty-year fixed rates are suddenly floating in a zone of 5% and below-before fees-bringing a rush of curiosity and applications, area mortgage brokers, bankers and credit unions say.

It’s still not clear if lenders will be as willing to play the game as borrowers. Tightened credit rules, diminishing home values and other economic factors will have a big effect on how many actual refinancings take place.

But the flood of interest is already stressing an industry that has been greatly downsized over the last two years. Nationally, it could be overwhelmed by a deluge of refinancings, said Jim Paterson, partner and broker at Gold River, Calif.-based Mortgage Consultants Group.

“There will be a period when rates drop, a true drop in rates, when it will take longer to get a loan,” he said. “It will add two weeks to the process.”

The catalyst was Federal Reserve action to buy $600 billion in mortgage debt from government mortgage giants Freddie Mac and Fannie Mae, analysts say. The government intervention aims to make mortgage funds cheaper and more plentiful to help revive the nation’s battered economy.

“All of our channels, the Internet, call centers and branches are experiencing significant increases in application volume,” said Bank of America spokeswoman Jumana Bauwens.

The push is prompting the bank to shift 300 staffers from its home equity operations to mortgage lending, she said.

Tri Counties Bank in Chico, Calif., is also seeing “a big pickup in refinancing,” said Chief Executive Officer Rick Smith. “As these rates have hit sub 5 (percent), everyone seems to want to come in.”

Yet for all the reported frenzy, it’s still too early to tell if there is-or will be-a 2003-like refinance “boom,” said Terry Halleck, president and chief executive of Sacramento-based The Golden 1 Credit Union.

“The past couple of weeks, applications have gone up about 300 percent from a year ago. It’s huge. The real question is whether people will complete the loan or are just rate-shopping,” she said.

The lack yet of a real boom is partly because many homeowners still believe rates may go lower as the economy weakens. And unlike 2003, many borrowers won’t qualify for today’s tightened credit rules.

“I had to jump through every hurdle on my loan,” said Fernandez, who is moving back to Houston. “They’re really scrutinizing people.”

Other owners also lack adequate home equity to refinance. And today’s lower rates only apply to loans under a certain amount.

But so many homeowners are browsing, Halleck said, that Golden 1 is starting an application fee “to filter out the people who aren’t serious.”

That’s not the only problem for lenders in a volatile rate environment. Paterson said lenders are also seeing a rash of people “breaking” or walking away from their rate locks as a better rate comes along.

That can cost a lender $800 in “hedging” costs on a $200,000 loan, he said. Halleck said Golden 1 doesn’t generally allow people to break their locks because of the cost.

“The likelihood is that low mortgage rates are not a flash in the pan. They will be with us for much of 2009 as the Federal Reserve pumps money into the mortgage market over a period of time rather than all at once,” said Greg McBride, a senior financial analyst at financial website Bankrate.com.

For households that qualify, this is the upside of the worst financial scare since the Great Depression. Many will shed thousands of dollars in long-range interest and free up personal spending money.

Sacramentans Scott and Marika Rose said two recent refinancings erased nearly $200,000 in interest from their original 30-year loan. The pair first refinanced to a 5.37% 15-year loan, then to another at 4.37%.

But for households that need most to refinance-those that owe more than their homes are worth-this is another downside. Almost nine in 10 homeowners of ZIP code 95742 in Rancho Cordova, Calif., fit into that category, said Irvine, Calif.-based First American CoreLogic.

That’s because the ZIP code consists almost entirely of new homes sold and financed at near-market highs. Falling values have erased their equity.

Elsewhere, thousands spent part of their home equity gains during the boom. All are now “under water,” industry shorthand for owing too much to refinance.

Analysts call the condition a major contributor to the state’s foreclosure crisis.

McManus, who bought his home in 2003, worries its value might slide to the point of no options before he gets a hoped-for 4.5%.

“I’m right on the fence,” he said. But McManus also said his longtime mortgage broker “told me to wait. That the rates will probably get better.”

In Roseville, Gage said he still has plenty of equity in the house he bought in 2005 after moving from San Jose. He plowed top-of-the market Bay Area equity into his new home.

“My plan is to take out $30,000 to pay off my car loan,” he said. “I have equity in the house. There was no way to tap it until they lowered the rates.”

While Gage aims for 4.75% with no points, what he’s really hoping for is 4.5%.

“If that were to happen I think the cavalry would come home for that. You would see everybody refinancing.”

That’s still to be seen, said Auburn, Calif.-based real estate appraiser John Ashworth. In the meantime, Ashworth notices the new business “a little mini refi boom” is bringing his way.

“I went from a few or no refis, or sparse refis, in the last half of 2008 to almost daily or several a week,” he said. It’s starting to compete, he said, with his foreclosure work.

© 2009, The Sacramento Bee (Sacramento, Calif.).
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

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By Chris Churchill

RISMEDIA, February 2, 2009-(MCT)-The use of mortgages insured by the Federal Housing Administration is soaring in the Capital Region, growth that comes as many home buyers are struggling to qualify for more traditional loans. Many lenders, skittish as foreclosure and default rates rise, have discontinued mortgages for borrowers with less-than-perfect credit or little saved for a down payment.

Credit standards for FHA loans, by contrast, are more relaxed. And while many loans now require that borrowers put 20% down, FHA loans mandate just 3.5%.

“Most of the programs with minimal down payments have all gone away,” said Lisa Fortin, a senior mortgage consultant at First Priority Mortgage, a RealtyUSA subsidiary in Clifton Park. “FHA is pretty much the only product still available.”

First Priority says FHA loans grew from about 8% of mortgages it originated in 2007 to about 40% today. Other brokers and lenders in the Capital Region report similar upticks.

And national numbers show the same trend: The U.S. Department of Housing and Urban Development says FHA loans accounted for just 3.7% of all home loans in its 2006 fiscal year, when subprime and other mortgage products for lower-income buyers were widely available.

But by September, with the credit crunch taking hold, the percentage of home loans backed by the FHA was 21.1%, according to HUD. (September is the most recent month for which the agency has data.)

In raw numbers, the FHA backed 141,000 mortgages in September, about three time the number of a year earlier.

Observers say FHA loans have largely shed the stigma they once had as a loan of last resort for those with lower incomes or shaky credit.

Also, said Sandra Nardoci, president of the Greater Capital Association of Realtors Inc. and an agent at Prudential manor Homes in Latham, the FHA program “used to be a lot more cumbersome than it is today.”

In a sense, the rising popularity of FHA loans during a widespread economic crisis is apt, because the program was created during the Great Depression in an attempt to boost stagnant real estate markets.

Today, the loans are available for as much as $292,100 in most of the Capital Region, or $373,950 for a two-unit property. Borrowers must also take out mortgage insurance-money that helps fund the program.

The FHA does not originate the loans. Instead, it insures them against default, making them a safer bet for lenders.

The loans, which are also available for refinancing, are widely used by first-time borrowers, including many who are now eager to take advantage of the drop in real estate prices in recent months.

“People who get into these mortgages are thrilled to death,” said First Priority’s Fortin. “It’s a great way to get into a home.”

FHA loans do have drawbacks, including the mortgage insurance requirement and interest rates that are generally higher than those available for other loans.

“It’s not the cheapest product out there,” said Therese Raco, an Albany-based administrative vice president at M&T Bank, where FHA loans now account for about 35% of Capital Region mortgages.

“But it’s an option if you’re not qualifying for other loans,” Raco added. “It’s an avenue for home ownership.”

On the rise

Loans backed by the Federal Housing Administration are growing in popularity because of the credit crunch. Use of the loans grew rapidly as other types of mortgage credit became more difficult to obtain.

Time period FHA loan market share

Fiscal year 2006 3.7%
Oct. 2007 6.4%
Jan. 2008 7.9%
April 2008 13%
July 2008 17.1%
Sept. 2008 21.1%

Source: U.S. Department of Housing and Urban Development

Copyright © 2009, Albany Times Union, N.Y.
Distributed by McClatchy-Tribune Information Services.

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Read more real estate tips and topics on RISMedia.com:

• With No Room to Cut Rates, Fed Looks to Other Remedies  
  Goodbye, McMansions - Americans Buying ‘Right-sized’ Homes

RISMEDIA, February 2, 2009-The Association of Energy and Environmental Real Estate Professionals (AEEREP.org) and EcoBroker International announced a partnership with the Residential Energy Services Network (RESNET). The partnership links AEEREP’s and EcoBroker’s real estate professional members to the industry’s most trusted source of energy raters, further helping consumers evaluate and make energy improvements to their homes in the face of mounting energy costs.

“With renewed interest in residential energy efficiency driven by consumer demand for economy, comfort, environmental sensitivity and performance, now is a perfect time to create this consumer-focused partnership,” said EcoBroker CEO Dr. John Beldock. “EcoBroker and RESNET share a mission to improve energy efficiency and the environment, and both organizations offer consumers the experts they need to assist them in achieving these goals.”

This partnership enriches the competitive offerings of both memberships, introducing even more of EcoBroker’s real estate members to the innovative energy rating programs used to help consumers evaluate and make energy-efficiency improvements to their homes and qualify for the financing to pay for the upgrades. RESNET members gain access to new business opportunities and a strong referral network. EcoBroker educates its membership on the key benefits of RESNET through its core curriculum, website and newsletters.

“As an industry leader in energy efficiency, we are proud to partner with EcoBroker who has done so much work to educate real estate professionals on this important topic,” said RESNET Executive Director Steve Baden. “We believe our memberships and the consumer will benefit greatly from this alliance.”

For more information, call 1-800-706-4321 or visit www.ecobroker.com.

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Don’t miss other real estate tips and topics on RISMedia.com:

• Americans Ready to Spend More Green on the Home  
  January Op/Ed - Affordable, Cozy, Green-and Building Business

RISMEDIA, January 31, 2009-OptHome, an online resource for homeowners, says it’s easier and less expensive to go green than homeowners may think. Suggest these few simple and cost-effective tips that your clients can incorporate into everyday living to help turn their home into a more energy-efficient investment.

1. Recycle. It’s free, reduces household consumption and increases energy efficiency.
2. Save Water. Install low-flow shower heads and faucets to cut back on water flow. A simple fix-shorten your shower times and shorten your water bill.
3. Conserve Rain Water. Set up barrels in your backyard to collect rain water and snow for watering plants and shrubs. Use this to water your indoor plants, too.
4. Reduce Electricity. Remember to turn off the light when you leave the room and to unplug your computer and other electronics and appliances when not in use. These small gestures will not only save energy but will save you money on your electric bill as well.
5. Replace Light Bulbs. Replace your current light bulbs with compact fluorescent lighting. These bulbs use 30% less energy, but produce the same amount of light and last longer.
6. Drive Less. You may not be ready to give up your SUV, but why not trade it in for a hybrid?
7. Double up on Printing. Configure your computer to print on both sides of the paper. This saves paper, trees and you running out to the store last minute to buy a new supply.
8. Adjust Refrigerator Temperature. Refrigerators use the most electricity in your house. Adjust your fridge to the average temperature of 37 degrees F and your freezer to 0 degrees F.
9. Support Local Farms. You will be cutting back on gas and decreasing our dependence on oil with the trucks that are used to ship produce.
10. Dry Clothes Outside. Hang your clothes outside and get that fresh smell. You’ll also be reducing the amount of energy you use in the home.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

RISMEDIA, January 30, 2009-Gaze up and down the streets of the Antiquity subdivision in Cornelius, North Carolina and you’ll see pristine homes and a carefully developed neighborhood. Constructed by the Cunnane Group out of Charlotte, Antiquity is a nationally recognized “Smart Growth” plan featuring a vibrant, walkable community integrated with planned commercial and retail areas.

The first streets of the new development include a variety of brightly-colored low-maintenance homes with energy-efficient Simonton ProFinish® Brickmould 600 windows. Historic American architecture provides a comfortable feel to the entire community, while low-maintenance products foster an easy-care lifestyle.

“One of our goals for this community was to offer homes with high value and energy efficiency elements,” says Ryan Aikia, chief builder for the Cunnane Group. “Every window in Simonton’s Brickmould 600 product line is ENERGY STAR® qualified and comes standard with a Low E/Argon glass package. Those units are impressive for helping lower energy bills for homeowners while giving a stylish look to the home.”

Each Brickmould 600 window includes a 7/8″ Insulating Glass Unit (I.G.U.) for maximum energy efficiency. Optional PVC grids (which were used in many of the Antiquity community homes) in Colonial, Prairie and Perimeter styles create Simulated Divided Lites on the windows. With the exception of the Geometric styles, all windows can also be ordered with 3-1/2″ Flat Casing Trim installed at the factory at a 90-degree joint at the head to simulate traditional wood trim. A unique warranty is offered with the windows: a lifetime warranty to the original owner and transferable once, turning it into a 20-year warranty. Glass in the windows is prorated in the warranty; first 20 years fully replaceable at 100%, 21 to 50 years replaceable at 75% and after 51 years replaceable at 50%.

“We can easily tell that the Simonton ProFinish Brickmould 600 series was designed with the homeowner in mind,” says Aikia. “From the extensive warranty to the many standard features that would normally be ordered as upgrade items, this window series is perfect for energy-conscious homeowners who want a low-maintenance lifestyle.”

When completed, the Antiquity community will feature a 30-acre park, athletic fields, an arboretum, an amphitheatre and nine mini parks tucked in and around the homes. Downtown Antiquity will include retail shops and outdoor dining. For additional information on the Cunnane Group, visit www.cunnanegroup.com.

Simonton Windows produces ENERGY STAR® qualified replacement and new construction windows and doors, including a line of impact-resistant products. Founded in 1946, Simonton’s hallmark has been to deliver its made-to-order products in seven days or less. Part of consumer products company Fortune Brands, Inc. (NYSE: FO), Simonton has manufacturing facilities in four states.

For information, call (800) SIMONTON or visit www.simonton.com.

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Previous Featured Listings on RISMedia.com:

• 2007’s Greenest Home in America Now on Market
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RISMEDIA, January 29, 2009-Citing unseasonably cold weather in many parts of California and drawing upon the experience of having provided service to hundreds of thousands of homes, member firms of the Home Warranty Association of California (HWAC) are alerting homeowners to the energy and cost saving benefits of “winterizing” their residences.

While noting that winterizing initiatives may vary from region to region, HWAC officials also emphasize the special attention required by first-time homeowners.

“Understandably, new homeowners may be unfamiliar with the operating systems of their new homes until they have lived there awhile, just as one may be unfamiliar with the features of a new car. As people live in a house, preparing for winter should become a routine that creates a home that provides the necessary comfort without expending extra energy or money,” said Billy Jensen, president of HWAC.

Heading the list of winterizing tips, HWAC suggests that homeowners be certain that their furnace filters are clean. A dirty filter can interfere with the free flow of air, leading to higher fuel costs, overheating and eventual shutdown. HWAC emphasizes that filters are an investment bargain.

Other key winterizing tips offered by HWAC include:

- Make sure registers for central heating are open in all appropriate rooms. The home warranty association also recommends making sure that registers are not blocked by drapes, curtains or furniture to ensure proper heat and air flow to the entire room.
- Set thermostat to the lowest comfortable setting. For each degree the thermostat is lowered and depending on the climate, a homeowner can save up to 5% on heating bills.
- Install a programmable thermostat to regulate the temperature at night and when you are away from home.
- Insulate water pipes to prevent potential freezing that could result in cutting off the water supply to the home. HWAC suggests purchasing pipe insulation made for this purpose, or even wrapping pipes with an ordinary cloth. An additional advantage is that hot water will flow to the faucet faster, so there also is some savings on water.
- Replace deteriorating weather stripping. Over the years weather stripping loses its capacity to block air, and can be deceptive because it’s still in place. New energy conservation technologies have improved options for weather stripping. Check your local home improvement store for the latest products.
- Water Heater Settings. Set your water heater at low to medium. 120 degrees is recommended for most common uses. Many unsuspecting homeowners never check the setting, which may result in higher energy costs with little resulting benefit.

“Winterizing your home can provide substantial cost and energy saving benefits, particularly during a challenging economy. With energy costs continuing to increase, it makes sense to take a few moments to evaluate the simple measures that can make a big difference in both the comfort of your home and your pocketbook,” Jensen said.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.
 

RISMEDIA, January 28, 2009-If you’re over 62 and a homeowner you have a unique opportunity to get significant, spendable value from your home, even if you still hold an existing mortgage. Recently, LendingTree launched a reverse mortgage service for interested senior homeowners looking to talk with lenders who can help them consider using the equity they have built in their home.

Senior homeowners have spent years, often decades, building up equity in their homes. An increasingly common practice of homeowners over the age of 62 is to obtain a reverse mortgage (also known as a HECM, a home equity conversion mortgage) which gives qualified senior homeowners a proven solution to help fund their retirement needs. In addition, and importantly to most independent seniors, a reverse mortgage allows them to live in their home as long as they wish.

Reverse mortgages may be a good option to consider for some, but before moving forward, it’s important to fully understand how they work. The following helpful advice comes from the LendingTree Smart Borrower Center:

1. Reverse mortgage candidates must be at least 62 years of age, have significant equity in their property, and be looking for a reverse mortgage on their primary residence only.

2. Anyone who intends to apply for a reverse mortgage is required by law to complete a 45-minute counseling session with a HUD (Housing and Urban Development) approved counselor*.

3. The sum from a reverse mortgage can be paid to you in a couple of different ways; all at once in a single lump sum of cash; as a regular monthly loan advance or as a credit line that lets you decide how much cash to use and when to use it; or you may have the option to choose a combination of any of these payment plans.

4. The amount of cash you can get from your home’s equity is determined by a number of factors including your age, your home’s value and location, and current interest rates.

5. Reverse mortgages may have tax consequences, could affect eligibility for assistance under Federal and State programs, and may have an impact on the estate and heirs of the homeowner.

For more information, visit www.lendingtree.com.

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By Bryan Redemske

RISMEDIA, January 27, 2009-(MCT)-It’s like leaving the closet light on all day and all night, all year. When 12 months are up, you will have spent between $50 and $70 to keep that light burning.

That’s an undeniably wasteful way to blow 50 bucks, but that’s how much energy is lost in an average household every year. The culprit: electronics sitting idle. But still, $50 in the grand scheme of things?

“The problem you have isn’t the waste in an individual home, but rather the large number of homes,” Omaha Public Power District spokesman Mike Jones said. “Add it up over a long period of time — that’s where the problem is.”

The problem is more electricity being used, which leads to pollution. It forces the electrical grid to work a little harder than it needs to, all for energy that slowly seeps away.

Unlike a light bulb, which generally relies on a switch to provide power, most electronics and appliances are continually powered, even when they’re off. Think of the clock on your coffeepot or VCR. It’s off, but not all the way.

“In the last study I saw, the average home has 19 appliances that use standby power,” Jones said. “Instead of one computer, they have two. A TV in every room. It adds up.”

And as it adds up, there goes your 50 bucks.

To combat the rise of wasted energy, Jones advocates unplugging appliances and electronics that don’t get used much. That includes cell phone chargers, radios and other small electronics that don’t need to be constantly powered.

“The problem that comes into play is resetting the clock on some devices,” Jones said. “If you don’t mind doing that, it’s a good way to save.”

Devices like Kill A Watt can also help save money. Available for around $25 through a number of online retailers, the gadget measures power use in constant wattage and kilowatt hours.

“That’s something that, 10 years ago, you didn’t see a lot,” Jones said. “People are becoming more aware-more concerned-about how they’re using energy.”

Part of that concern involves replacing outdated technology. Older appliances suck down more power, mostly because of the way they were designed.

“Older devices often use smaller transformers, while the newer stuff uses solid-state technology,” Jones said. “It’s much more efficient.”

When purchasing new electronics or appliances, check for energy efficiency ratings. It’s a given that some things are going to use a lot of power when they’re in use, but that doesn’t mean you need to keep paying for it after switching it off.

Copyright © 2009, Omaha World-Herald, Neb.
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

By Tom Gordon

RISMEDIA, January 27, 2009-The national foreclosure moratorium imposed by Fannie Mae and Freddie Mac, major banks such as Citibank and Bank of America, and a host of state governments has created a “breather” for homeowners in default. By working with loan servicers, some homeowners will be able to modify their loan terms and stay in their homes. But many won’t.

Not all borrowers will qualify for modified loans. Lenders are keenly aware of this, as well as the fact that foreclosing on a home is an expensive proposition: It can cost a bank $30,000 to $50,000 to foreclose on a home, plus carrying costs that equate to 1.0% to 1.25% of the value of each home per month. There is little enthusiasm for increasing bank-owned (REO) inventory in markets already saturated with foreclosed homes and falling prices.

As an alternative, lenders have new enthusiasm to ramp up the volume of short sales.

Short sales, as most know, are when the lender allows a distressed property to be sold at a price lower than the homeowner’s mortgage indebtedness, with the difference forgiven. This relieves the homeowner of their ownership and debt burden without marring their credit report the way a foreclosure would. It also typically allows the new purchaser to buy into the neighborhood at a substantial discount … much more in line with the property’s true, current market value. In other words, short sales facilitate efficient clearing of the market.

Historically, short sales have not been very appealing to lenders. The short sale is a complex process that requires an agreement by all the lien holders to accept the lesser amount owed by the original borrower. The paperwork and number of players involved in short-sale transactions can easily overburden a servicer who is already dealing with hundreds of thousands of loan modifications, REO dispositions, etc.

But now with over four million new loans in default in this cycle and six million more expected in early 2009 due to coming interest-rate resets, lenders such as Citibank, Bank of America and Wells Fargo are fired up for short sales.

As they see it, if just 25% of current loans in default could be sold through short sales it would stave off one million foreclosures (good for homeowners) and replace one million nonperforming borrowers with one million performing borrowers (good for lenders).

The industry’s challenge to accomplish this is two-fold: Evaluating their portfolios to determine which homes are well suited for short sales, and processing the high volume of bulk sales.

So lenders are now assessing a distressed borrower’s situation early in the loan modification process, calculating the sensibility of modifying the loan versus offering the property in a short sale or letting it likely roll into foreclosure. In cases where short sales are the best route, lenders are proactively assigning loans in bulk to be put through the short-sale process. (This phenomenon is strangely new to homeowners; in the past it was incumbent on them and their agents to initiate the short-sale process, not the other way around).

The second part of the challenge is how to process the actual sales, considering legacy technology solutions weren’t built to handle either the volume or the complexity of today’s short-sale transactions.

DepotPoint’s TrackPoint, with a new short-sale module, is up to the task. TrackPoint is an online workflow platform that operates in a SaaS environment. The short-sale module can scale an outsourcer’s or an asset manager’s operation quickly to handle massive amounts of short-sale volume, reducing costs and elapsed time to complete transactions.

Already using TrackPoint featuring the new short-sale module is MMREM, Matt Martin Real Estate Management, which has facilitated more than 10,000 short sales as the nation’s largest facilitator of short sales.

“Short sales are often complex, time-consuming transactions,” said Matt Martin, President and CEO of MMREM. “In today’s high-volume environment, managing them can be even more cumbersome than usual. REO TrackPoint featuring the new short-sale module simplifies and streamlines the process. It’s the most comprehensive, efficient national online platform we’ve seen for managing and processing default properties.”

MMREM has increased its short sale through-put by more than 300% by using TrackPoint with the short-sale module.

Tom Gordon is Executive Vice President of Business Solutions for DepotPoint, Inc., which brings greater efficiencies and cost savings to mortgage lenders, loan servicers, foreclosure attorneys and REO asset management firms that use the company’s Web-based application suite, TrackPoint, to vertically process properties through foreclosure straight into REO management.

For more information, visit www.DepotPoint.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

By Charlyne Varkonyi Schaub

RISMEDIA, January 27, 2009-(MCT)-Walk into the American Red Cross 2009 Designers’ Show House in southern Florida and it looks like business as usual. A French parcel-gilt turquoise chandelier in the living room. A custom-made chest inlaid with mother of pearl imported from the Middle East in the “Glamour Girl” bedroom. A totally remodeled kitchen with countertops of French blue limestone, Jenn-Air appliances in oil-rubbed bronze and a pair of barrel shade chandeliers from Jacques Garcia for Baker.

Despite the high-end glitz, the show house also delivers a few inexpensive ideas you can steal and plenty of fantasy to tuck away for when the good times start to roll again.

“To me, these showcase houses are like the runways of the fashion world,” says Joseph Pubillones, a Palm Beach, Fla., designer who created “Midnight at the Oasis,” a bar room in a Moroccan theme with tented ceiling and wide horizontal striped walls inspired by the mosques in northern Africa.

“You have to do things that are a little unexpected and untried. You have to push the envelope to convey a message or concept. It’s about a concept, a kind of wow. It’s not about a literal translation to your home. You can see it and take away an idea.”

Whether the ideas are high in the “wow” factor or concepts you can steal, we have nine things you shouldn’t miss in the 2009 show house00Providencia House, the 11,000-square-foot West Palm Beach, Fla., home owned by Tim and Florence Harvey.

1. Foyers need drama. The entry should let your visitors see a little into your soul or at least reveal some of your personal style. Lon Morris, of Lon Morris Interiors in New York, winks at Palm Beachers’ love of shells with the over-the-top bust, “A Sea God,” from Christa’s South in West Palm Beach. The bust is encrusted with amethyst and quality sea shells and sells for $6,900. Foyer walls should also make a statement like those Morris painted with brush and rag and seven layers of glaze.

2. Enjoying outdoor life. The southern climate is perfect for outdoor rooms, and on the second floor terrace Palm Beach designer Jennifer Garrigues illustrates how people live in South Africa.

“They all live on verandas and it inspired me because I love Africa and the animals so much,” she said. “In Kenya and the south, this is the way they live with white curtains and accented with color.” This space, which Garrigues said was long and narrow like a train, was wide enough to be broken into three areas-one for dining flanked by two conversation areas.

3. Wallpaper isn’t just for walls. It’s a designer’s trick to wallpaper the insides of bookcases to add interest and cover imperfections, but West Palm Beach designer Lisa Erdman makes it work especially well with this oversize pattern in the master sitting room. The walls are painted with Benjamin Moore’s Palladian Blue (No. HC 144) from the low VOC Aura line. Erdman cut the color 25% with white paint to tone it down.

4. Collections should make a statement. Palm Beach designer Jack Fhillips’ dining room was inspired by the Hollywood Regency style he was exposed to while working on Veranda magazine’s Beverly Hills show house. “There’s a certain hipness, a little luxe that’s a little different from Palm Beach and Florida,” he said. The lines are clean with focus on the artwork, such as the Square within a Square painting by Richard Serra, used over a 1940s console that he lacquered black and gilded. Collections also look better when used en masse. Fhillips used his collection of selenite crystals. He loves their texture and the way they change color. Why not paint your furniture to create a black-and-white room?

5. Scaling down high style. The dining room may look like a departure from Fhillips’ typical Palm Beach style, but some of his details are evident-such as use of menswear fabrics and tape-bordered drapes. You don’t have to use the linen menswear fabric on the chair seats, but you can use a similar look and copy the embroidered detail. The embroidered tape on the edge of the linen drapes comes from Samuel and Sons, but Fhillips said you can achieve a similar look with grosgrain or dressmaker ribbon from a craft store.

6. Bathroom makeover on a budget. Joseph Cortes, of HomeLife Interiors in West Palm Beach, kept budget in mind when transforming the old-fashioned bathroom with Formica cabinets that adjoin the bedroom he designed. He installed Flor carpet tiles ($60) over the flooring, a Caesarstone quartz countertop ($1,500), two sinks ($300 each), a Plexiglas cover over existing big bulb light fixture ($250) and drapes ($500). He hired a faux painter to update the walls and cabinets ($500). Total cost: $3,350. You can steal his idea and save more by buying less expensive drapes and countertops and painting yourself.

7. Make big impact with wallpaper. Large prints in wallpaper are a hot trend, especially those papers with shimmer or flocking. Cortes applied shimmery large-scale wallpaper by Studio Printworks in San Francisco on an accent wall to break up the dark paint he used in his “Pearl Essence” theme bedroom. And check out the flocked paper from Osborne and Little that Palm Beach Gardens, Fla., designer Angela Reynolds used in the bathroom next to her “Glamour Girl” bedroom. You can re-create a similar look with large-scale damask patterns at grahambrown.com for as low as $5 and $20 a double roll on sale. Another great idea: Look on the window shelves in Cortes’ room to see how he covered books with the same wallpaper for a high-end look.

8. Kitchens need a break from stainless and granite. Scotty Rawley and Melissa Zober of RZ Design Group in Palm Beach used Jenn-Air’s appliances with a rubbed bronze finish, which Rawley calls “the new stainless.” Unlike their orangeish appearance in the advertisements, they look almost like wood. Instead of granite, they used French-blue limestone from Haifa. Rawley estimates the kitchen makeover at $150,000. But here’s a budget idea you can steal: Have walls you want to hide? Drape them with sheers like they did to cover the brick walls in the breakfast area.

9. New heights for the bedroom. Who says you can’t use a chandelier in the bedroom? Cortes added drama and light to a bedroom with dark walls with this Hollywood chandelier by Brandon and Egmond from Carriage House at the Design Center of the Americas in Dania Beach. It’s coral reef-inspired in a nickel finish and would cost about $11,000 from a designer.

© 2009, Sun Sentinel.
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Don’t miss other homeowner tips and topics on RISMedia.com, see:

• Downsizing a Home Requires Cutting Contents, too
• Moving with Pets - Impossible or Possible?
• Setting the Mood with Color

By Greg Pearson

RISMEDIA, January 23, 2009-(MCT)-The kids have moved out. Those three bedrooms are looking awfully lonely. That spacious backyard that once served as a barbecue pit/football field/volleyball court now looks like a breeding ground for weeds, not to mention back-breaking acreage during mowing season.

You want to move to something smaller, but the task seems overwhelming. There’s a basement full of boxes, a garage stuffed with unused toys and rusting machinery.

Let the experts help you get moving.

Rod and Sharon DePue had to do major downsizing before they moved into their apartment seven years ago.

They had to sell two condos-one in Greenfield, Wis., another in Florida. They had prepared well for when moving day would come.

“We saw contemporaries who had to close out the house of elderly parents,” Sharon said. “They had to go through 50 or 60 years of stuff. We vowed not to do that to our children.”

It is the key to downsizing, they said. Sort through your stuff regularly and get rid of what you no longer use. You’ll thank yourself on moving day.

In fact, the DePues wish they had done a little more sorting and tossing. They kept enough of their old belongings to furnish their 1,000-square-foot apartment in Milwaukee’s Yankee Hill area, but once they got into the new space, they discovered that they wanted new furniture, too.

“We now don’t have any of the stuff we moved with except a lamp,” Rod said.

Ray and Peggy Hendrickson didn’t have a lot of time to plan for their move in the fall of 2007.

“I thought we could live where we did forever,” he said of the Shorewood, Wis., home they had owned for more than 35 years.

But Peggy Hendrickson had medical setbacks last year, and Ray fell and broke his leg in the spring of 2007. They tried to continue living in their home with the help of visiting medical care but soon realized they would have to move somewhere that could provide a nursing home-type setting for her and a smaller place for him.

There was much sorting to be done.

“There’s a lot of trash when you’ve been living in the same place for many years,” said Ray Hendrickson, a retired Milwaukee Public Schools teacher and football coach.

Storage space in a condominium probably will be less than in your house. Space gets even tighter if you’re moving to a nursing home or assisted-living site.

Bruce Nemovitz, a broker with Realty Executives Integrity in Whitefish Bay, Wis., said people also have to think about the emotional impact of winnowing their belongings. There are a lot of memories packed into those boxes in the attic.

“People have a sense of feeling overwhelmed. Then they tend to procrastinate and then they become frozen,” said Nemovitz, who specializes in helping seniors relocate and has written a book on the topic, “Moving in the Right Direction.”

To help get started, Nemovitz suggested having a family get-together. Make it a party, where each of the children puts Post-its on what he or she wants.

There are companies that specialize in helping with downsizing. They help organize estate sales or auctions, line up items for donations and assist with the packing.

Smart Moves in Hales Corners, Wis., is one such company.

Older residents making a move often “don’t even want to think about how they’re going to get from point A to point B,” said Sue Wiske of Smart Moves. “Having someone to walk them through it can really help.”

While there’s less room for boxes of old belongings in a smaller home, there’s also going to be less room for the couple moving in.

“You have to learn to live together in a smaller space,” Sharon DePue said. She and her husband have set up the second bedroom in their apartment as a computer room. He often will work there while she’s reading or working in the kitchen.

Space constraints are an issue for many downsizing couples, said Jack H. Smith of Shorewest Realtors in Wisconsin.

“They’re used to Harvey going into the other room to watch TV. Now they’re in the same room, and she’s thinking, ‘Does the football game have to be that loud?’”

Before moving, people also have to think about the practical aspects of everyday life, Smith said. How much will you miss a yard, or having a garden? Can you get by with a one-car garage-or no garage-instead of the two-car space you’ve always had?

Some people come to him excited about the prospect of moving into a downtown condo. After analyzing all the factors, they sometimes end up moving into a smaller home with a smaller yard closer to downtown.

“They use that as a happy medium. Instead of being 25 minutes away, they’re eight minutes from downtown,” Smith said.

Routine tasks like hauling groceries can be more of a chore in a condominium. It may be a longer walk from the car to the kitchen. There may be elevators or stairs to navigate while juggling your grocery bags.

The same goes for walking the dog. There likely will be no more just opening the back door and stepping out quickly with your pooch, Smith said.

“If the dog has to go out at 2 in the morning, you can’t just hold it over the balcony.”

© 2009, Milwaukee Journal Sentinel.
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

Don’t miss other homeowner tips and topics on RISMedia.com, see:

• Moving with Pets - Impossible or Possible?  
  Setting the Mood with Color

RISMEDIA, January 22, 2009-(MCT)-Rose Vicente is tired of waiting.

Sixteen months after she and her husband, Manny, put their Simi Valley home up for sale for $650,000, they decided they couldn’t put their life on hold any longer.

Although they still are waiting for a buyer, the Vicentes purchased a home in Wildomar, Riverside County, and plan to move in February.

Last year, the Vicentes told The Star they wouldn’t budge when they lowered their asking price on their five-bedroom house to $495,000. Their outlook has since changed. The Vicentes just slashed their asking price to $379,000, a 42 percent reduction from their original asking price.

Their experience mirrors what is happening in the weak housing market.

Ventura County home sales shot up nearly 50 percent in December, but the median sales price fell by more than 35 percent from the previous year, culminating a nerve-racking 2008.

Sales were bolstered by foreclosure deals, which brought down overall home prices.

There were 876 new and existing homes and condominiums sold last month, up 48.5 percent from 590 the previous year, according to MDA DataQuick. It was the sixth consecutive month of year-over-year sales increases, a result in large part of buyers being lured by deeply discounted distressed properties. Foreclosures comprised 51.4 percent of last month’s resale activity.

The median, the point at which half the homes sold for more and half for less, was $338,000, down 35.6 percent from $525,250 in December 2007, according to the real estate information service.

A similar trend was seen throughout Southern California. Each of the six counties in the region reported a strong uptick in sales but a downward slide in prices.

A total of 19,926 new and existing homes and condominiums sold across Southern California last month, up 19.2 percent from 16,720 in November and 50.5 percent from 13,240 in December 2007 — the slowest December in DataQuick’s statistics, which date back to 1988.

Foreclosures comprised 55.7 percent of the resale activity last month in the Southland, up from 24.3 percent for the same month the previous year.

“It’s mostly a bargain shopper’s market,” said Andrew LePage, DataQuick spokesman, noting that mid- to high-markets are posting sluggish sales. “Some of the more expensive markets are at or very near record lows for sales.”

The Southland median was $278,000, down 34.6 percent from $425,000 in December 2007.

Sales from September 2007 through last summer were at the lowest in at least two decades, but they’ve since edged up, DataQuick reported. Still, last month was the fifth-slowest December in DataQuick’s statistics.

Sales gains were strongest in areas that were hit hardest by foreclosures, where home values experienced the greatest declines. The median for San Bernardino and Riverside declined 42.9 and 41.1 percent, respectively, but sales surged 88.5 percent and 77.2 percent.

Monthly mortgage payments that buyers are committing to are declining along with home prices. A typical monthly mortgage payment that Southern California buyers committed themselves to paying was $1,239 in December, down from $2,060 the previous year, according to DataQuick.

For the Vicentes, the substantial price drops gave them the ability to buy a second house in California, without being forced to wait until they sold their Simi Valley home. They decided on Riverside County because they were able to buy a 3,500-square-foot house — twice the size of their current home — for $300,000.

The space was important, Vicente said, since her son and daughter-in-law and their two children have moved in with them.

“Getting more house for your dollar is more important because grandchildren and kids are moving back home they can no longer afford to live on their own,” she said.

It’s been a tough road, and not just for sellers, Vicente said. As buyers, she and her husband were surprised to see severely damaged homes with kitchens and tubs torn out by bitter former owners.

She said she is hoping that the market will stabilize within the next five years so her family can move to Texas.

“I feel sad about leaving Ventura County,” she said. “But there are things you have to do. Hopefully, this will be better for the family.”

Copyright © 2009, Ventura County Star, Calif.
Distributed by McClatchy-Tribune Information Services.

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RISMEDIA, January 22, 2009-President Richard M. Nixon came to San Clemente, California in 1969 and established a Western White House where dignitaries gathered, treaties were signed, and where the Nixons resided at the time of the David Frost-Richard Nixon interviews.

The grounds of the Western White House were subdivided into 16 lots in the 1980s. Construction of a new estate on a parcel just two doors down from Nixon’s home has recently been completed. The newly completed property is represented by David and Avarelle Silver-Westrick of Keller Williams OC Coastal Realty, www.silver-westrick.com.

The new estate, a grand Spanish Colonial Revival home, is steeped in history. Although newly built, the estate features many of the same architectural elements evident in the former Western White House, according to the architect for the estate, David York. The new home is approximately 13,000 square feet with seven bedrooms and ten baths. It is situated on a spectacular, ocean view parcel that is nearly an acre in size. “Entering the residence through the grand court yard,” says York, “parallels the palaces of Andalusia, Spain.”

Construction of the newly built estate was not without controversy. A wall built at the behest of President Nixon in the early 1970s for security purposes cut across the back end of the parcel for the new estate. Some residents of San Clemente fought to have the wall designated a historic landmark. The dispute was ultimately resolved in favor of the property owner.

According to David Silver-Westrick, of Keller Williams OC Coastal Realty, “Everything about the property is exceptional — the neighborhood, the grounds, the design of the estate, the construction quality, and the detailing which includes extensive use of imported items such as lighting fixtures from Morocco.” The property includes a 36-seat dedicated theatre and lobby, a full spa and workout room, and a resort quality negative edge pool with a sunken bridge. The grounds also feature a sports court, cabanas, and fountains. The internationally famous surfing breaks of Cottons and Trestles are located just steps away from the estate.

For additional information, please contact David & Avarelle Silver-Westrick at 949-874-0657, www.silver-westrick.com.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

RISMEDIA, January 22, 2009-(MCT)-It may seem counterintuitive to launch a real estate firm during a recession that has sent home sales and values falling, but the founders of Rosner Doherty Realty in New Haven, Conn. say the challenging market added to the allure of starting the company.

“It gave us an opportunity to get involved when other people would either be leaving the market or shying away,” said Merrick Rosner, a managing agent at the company.

Rosner, 29, his brother, Jeremy Rosner, 32, and Kieran Doherty, 30, started the company in September with Jeffrey Rosner, 58.

The younger Rosners and Doherty are managing agents. Jeffrey Rosner, who is Merrick and Jeremy’s father, is the company’s broker. He previously owned Ross Realty, a local firm now run by his mother, Pearle Rosner.

The company specializes in residential and commercial real estate sales and leasing, as well as investment properties, along most of the New Haven Shoreline area.

Doherty said agents who have been in the business longer may be frustrated in this market, having witnessed prior real estate booms, but the managers at this company have a “fresh” perspective.

“We don’t know any better,” he said, referring to the current market’s struggles. “Even though times are bad, we’re excited every day to come to work.”

The real estate market has been hit hard in this economy.

“I don’t know of anyone else who’s opening a real estate company these days,” said Anthony Rescigno, president of the Greater New Haven Chamber of Commerce. “Frankly, we teased them a little bit about opening up a real estate business. (But) they’re looking long term; they’re not concerned with what’s happening here the next six months to a year. I’m very impressed with these young guys.”

Market downturns tend to present opportunities to entrepreneurs in the industry, according to Linda St. Peter, president of the Connecticut Association of Realtors.

“The economy, as challenged as it may be, has not stopped the entrepreneurial spirit in real estate. Companies continue to be formed, bought, sold and merged,” she said.

The founding of Rosner Doherty marks a homecoming for the Rosner brothers and Doherty, who all graduated from Hopkins School. The Rosners grew up in New Haven; Doherty is from Madison, Conn.

Prior to starting the company, Merrick Rosner was a research analyst for Thomson Financial, a senior event manager at Gabel Entertainment in New York City and a senior district sales manager for Office Depot.

Jeremy Rosner was a pharmaceutical specialist in Connecticut, a medical sales specialist in New York and New Jersey, and began his real estate career at NY Commercial Realty Services LLC.

Doherty was a sales and trading assistant at First Albany Capital in New York City and later worked in sales at Janney Montgomery Scott and Deutsche Bank Securities Inc., both in Philadelphia.

The three returned to Greater New Haven to form the new company. They plan to eventually expand it, adding both staff members and offices.

“We all love the community,” said Jeremy Rosner, adding they are eager to establish additional ties in the Shoreline. They recently started the Greater New Haven Breakfast Club, a networking group that meets weekly.

Jeffrey Rosner, who ran Ross Realty for more than 30 years, said his counterparts at the firm join a growing number of young professionals in the region who have an innovative business outlook. “They have a whole different approach,” he said.

For more information, visit www.RosnerDoherty.com.

Copyright © 2009, New Haven Register, Conn.
Distributed by McClatchy-Tribune Information Services.

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RISMEDIA, January 21, 2009-With people moving worldwide for work, Boxers are going bicoastal and cats are clearing through customs on a daily basis. Moving isn’t just stressful for people, it’s equally stressful for pets. So when it comes to moving pets, pre-planning is very important as animals can be very sensitive to changes in their surroundings. So we went to the expert Rachel Farris, Relocation Specialist at PetRelocation.com. Farris offered three top things to keep in mind as a pet owner moving with pets.

1. Make Friends with the Travel Crate-Whether you travel by car or by air, the crate your pet travels in will be his “home” during the trip and it’s crucial that your pet feels comfortable in it ahead of time. According to Farris, “As soon as you know you’re moving, it’s a good idea to get the crate,” Farris said. “That way, you can start getting your pet used to it well in advance. This will help your pet’s stress levels on your move date.” She also pointed out that many pet stores offer crate training classes. Additionally you can try feeding your pet in the crate on a daily basis to help ease the transition.

2. Pick a Frequent Fido Flier-Why should you get extra leg room for yourself but not for your pet? Select an airline that offers first-class accommodations for pets traveling in the cabin or under the plane. “At PetRelocation.com, we only work with pet-friendly airlines that keep pets in climate controlled conditions throughout the flight,” says Farris. “This ensures that every pet will arrive safely at its destination.” According to Farris, Continental and Northwest are both known for their superior pet-safe cargo programs in the US, and Jet Blue just introduced their new JetPaws program, which caters to pets traveling in-cabin.

3. Arrange a Jet-Setter Check Up With Your Vet-If you’re making a trip across state lines or international borders, you’ll need a health certificate issued the week before the flight. “Most states require pets to be current on their rabies shots,” Farris says, “and for international trips, the documentation for importing or exporting pets can be even more complex.” Planning ahead and consulting a professional pet relocation company can ensure that your trip goes smoothly.
No matter if your move is big or small it is important to do your research and make plans accordingly when moving pets. This can make all the difference, resulting in a well transitioned pet and a less stressed pet owner.

Contact Move Advocate today for more information and for help in moving your clients and their pets safely.

For more information, visit http://www.moveadvocate.com/.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

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By Jean Patteson

RISMEDIA, January 21, 2009-(MCT)-Color affects mood, as every pop psychologist knows. Considering the pall of gloom cast by the dire economy, it’s no wonder color-trend forecasters are predicting a bumper year for yellows and purples-the former to cheer us up, the latter to calm us down.

Not that everyone is rushing out to purchase paint or furnishings in yellow and purple, just because those have been declared the trendy colors for 2009.

“No matter what the trends, put colors in your home that you feel good about,” advises Jack Fowler, an Orlando, Fla., interior designer. “Take what the experts say, then adjust for your personal taste.”

With that in mind, here is what a trio of color experts is saying:

Toast mimosa yellow. “Yellow symbolizes sunshine, warmth, optimism and good cheer,” says Leatrice Eiseman, director of the Pantone Color Institute in Seattle. She predicts the color of the year will be “mimosa yellow”-the golden-yellow of fluffy mimosa blossoms and the orange-based champagne cocktail.
Mimosa reflects “the warmth and nurturing qualities of the sun, properties we humans are drawn to for reassurance,” says Eiseman. “It’s also a hue that sparks imagination and innovation.”

In other words, it’s well suited to a stalled economy in need of bright ideas to spark a recovery.

Use mimosa yellow as an accent color-as paint on a single wall or pillows on a sofa, suggests Eiseman. “It’s marvelous with gray or taupe. It gives them a lot more life.”

Yellow is also a top pick of Debbie Zimmer, color and decorating expert at the Rohm & Haas Paint Quality Institute in Spring House, Pa.

“But not school-bus yellow. A softer shade,” she says.

“Yellow is a refreshing color. It can brighten any interior space. It’s terrific for sprucing up a house for potential resale. In an entrance hall, it’s really welcoming.”

Warm up to purple. Muted shades of purple also will grow in popularity and become one of the year’s memorable colors, predicts Zimmer.

“As we head toward a more difficult economy, we’ll see more conservative colors-dusty purple, lavender, violet,” she says. “The softer purple hues are soothing. The darkest hues provide a dramatic backdrop for brighter accent colors.”

Americans are looking for something uplifting, says Patricia Call, an interior designer in New York and a board member of the Color Marketing Group in Alexandria, Va. And that translates to purple power.

“Historically, purple is associated with royalty. Now it’s being use for everything from cooking ranges to washing machines,” says Call. “In a bad economy, it gives you a lift to feel royal in the kitchen or laundry.

“It’s also a wonderful accent color. Purple Murano-glass sink stoppers bring glamour to a bathroom. Purple vases or pillows add an exciting pop of color to a living room, especially in combination with sophisticated neutrals like grays and browns,” she says. “And as a wall color, the softer shades (of purple) are fabulous with southern natural light.”

While purple may not be the top interior-decor choice of most people, “once it’s been in fashion for a while-and purple has been in fashion for a year or more _ it enters people’s consciousness, and people become comfortable with it,” says Call.

Other fashionable options. Don’t care for yellow or purple? Zimmer sees several other color trends emerging for 2009.

Americans yearning for “artisanship and authentic materials” are turning to “menswear colors” such as gray, navy blue, brown and black, she says. All are colors that will inspire textured finishes on walls, and furnishings featuring argyle, herringbone and pinstripe patterns.

In addition, Americans’ growing eco-consciousness is expanding the decorating palette beyond green to embrace the blues of the oceans and skies, and fruited shades such as mango, orange, apple and pumpkin, says Zimmer.

“Exotic brights,” such as orange, red, turquoise and teal are high on Call’s list of trendy hues. So are white and a whole range of blues.

“Blue is important for our sense of tranquility,” she says. “And blue is the obvious replacement for all the greens of the last few years. If you’re ready for a change, blue is the comfortable choice.”

When choosing a color for your home, it’s worth considering the psychological effect a shade can have on your mood.

Here is a list of colors and their emotional associations, some positive, others negative:

- Yellow: cheerfulness, hope, energy, creativity, caution.
- Purple: calm, uniqueness, meditation, bravery, royalty, spirituality.
- Red: warmth, love, valor, glamour, celebration, danger.
- White: cold, purity, cleanliness, goodness, austerity.
- Black: opulence, sophistication, drama, gloom, dread.
- Green: nature, nurturing, fertility, restfulness, luck, jealousy.
- Blue: tranquility, mystery, freshness, uniqueness.
- Orange: warmth, exoticism, excitement, sociability, change.

© 2009, The Orlando Sentinel (Fla.).
Distributed by McClatchy-Tribune Information Services.

RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.

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