Where is the Real Estate Tipping Point?

I loved the book “Tipping Point” which speaks to a pivotal moment or event that will dramatically shift the course of a trend or behavior. For real estate, the tipping point was certainly the meltdown of the stock market and banking institutions resulting in loss of confidence and loss of jobs and investment nest eggs. The loss of confidence I think is still at the core of the issue. Buyers are not confident that they will continue to be employed or that their stocks or home will be good investments for the future. Of course, the fact that almost everyone had irresponsibly accumulated credit card debt is undeniable, and as those debts are reduced by paying them off or spending control, confidence in one’s own ability to manage money will return. The obvious indicators to look at to foresee a turnaround would be increased employment rates and improved home values and stock performance.
There are some other interesting trends contributing to the low volume of home sales. One is that the white-collar jobs are being reduced and these buyers were the “bread and butter” of a healthy market. Now we see first-time homebuyers, especially returning Veterans and higher end professionals but that range of $300,000 – 500,000 is like a never, never land recently.
Another factor of interest is the fact that home formation is way down. That would be people moving in together to buy a home and establish a home or family. Another indicator I follow is retail sales which was up this last week and even auto sales are up. Could a home purchase be next? I am hoping so because mortgage rates are at rock bottom so the opportunity is a once in a lifetime one.
What will be the tipping point to get people back into the housing market? I wish I could predict that and in fact what we may see is a slow turn of this Recession Ship as confidence returns to American homebuyers.

PROPERTY TAX ALERT

The Bernalillo County Assessors office is about to undertake a campaign to adjust the property taxes on non-owner occupied properties. The adjustments that have already been made have been quite discomforting. The way in which they will be determining "non-owner occupied" is by whether the property tax account does or does not claim "head of household". If the property does not claim "head of household", it will be assumed to be non-owner occupied. A protest option will be available if a property is designated incorrectly but who wants to go through that! Be sure to call the Tax Assessor to declare head of household or call me and I can check to see if you have that designation.

Realtors Virtual Tour blog reference

Got this email this morning:
Hi Judy,

My blog tomorrow will be talking about agent listing systems. Since you have such as well-tuned system, I will be using that as an example. I was sure you wouldn't mind the exposure, but wanted to be sure you knew that as well. Here is the blog: http://www.realestatevideotalk.com/2010/11/17/how-well-does-your-listing-system-work-online/

Hope things are going well!
Jim Gross
Realtor Virtual Tours

TRUE GRIT RETURNS

So excited that the remake of this great film with John Wayne is about to be released. We are all quite proud here in New Mexico that it was mostly filmed here. Perfect settings. We ARE historical USA.

So I never met John Wayne when I lived in Hollywood, but Robert Mitchum his counterpart, was a great friend. His son and then wife were my best friends. She and I and Sharon Tate were a threesome that hung out at famous parties, Beverly Hills bars and all places to be seen at. Often we hung out at Robert Mitchum's home which was near mine in one of the Canyons. I remember one huge New Year's Eve party when they tented the backyard and had food and music all night. ARound three am after the caterers had left, I got hungry and Robert fixed me fettucine with some noodles he had just imported from Italy. The most delicious fettucine of my life but I got the worst stomach ache which I never told him. I spoke to him two weeks before he died and he was charming and feisty as usual.

BEST TIME TO BUY A HOME

Leading economist who predicted housing crash says now is time to buy
AN economist who was the only person in the property industry to label the housing market a bubble said yesterday that now is the right time for new buyers to enter the market.
Derek Brawn, whose book on the property market predicted the bursting of the bubble, said first-time buyers should buy now once they find a property at the right price.
The optimal time to buy a house was not at the bottom of the market but just before the market hit the bottom, Mr Brawn said.
A year before the bottom of the housing market is the ideal time to buy, he said.
Mr Brawn, who has launched a house price calculator at www.CompareBuy2Rent.ie, added: “House prices are only one factor that people should consider when choosing whether to buy a house now or wait for further reductions.”
The other factors include benefits of paying off the capital amount on a mortgage, plus the fact that homeowners receive tax relief on mortgage interest.
“People need to consider both these benefits and factor in further house price drops, so they can buy now — but at the right price,” the former economist with an estate agency chain said.
Mr Brawn, whose book ‘Ireland’s House Party: What the Estate Agents Don’t Want You to Know’ made him the scourge of the property industry, said renters were missing out on mortgage tax relief.
Mr Brawn gave an example of a three-bed semi for sale in Kildare for €200,000.
A couple with a €20,000 deposit who are now renting a similar property for €850 a month should buy now if they can get the price down to €183,000.
This is based on a likely further decline in house prices of 15pc over the next five years, with a rise in European interest rates, calculations on CompareBuy2Rent suggest.
- Charlie Weston Personal Finance Editor