Long Island Home Search

The end of the bottom is upon us....

2009-08-17T12:46:00.000-07:00

Well I've been watching and waiting for some signs to signal that the end of the bottom is approaching and I have begun to see those signs. Foreclosures and short sales are still coming out on a daily basis but now they are being snatched up pretty quickly if they are good deals. Buyers are wading back into the market at a rapid pace and are no longer scared of their own shadows. The number of contracts being signed are up and the days on the market are down. In some "hot" areas where there is a lot of pent up buyer demand, the days on the market for the average well priced home is now below 30.

Mortgage financing is now the biggest obstacle that is still hindering a complete housing recovery since consumer confidence is slowly being restored. Banks are slightly beginning to loosen their vise-like grip on credit so we are seeing a slight uptick on closings. Rates are still very low but credit is still difficult to obtain. Buyers who have good credit, verifiable income and a down payment are really scoring some terrific deals in this market. Investors with cash are snapping up low priced deals and either fixing and flipping or holding as rentals for future appreciation.

My prediction is that the Metro NY housing market will be on the road to recovery as we hit 2010. Real price appreciation probably will not occur until 2012 but by then we will be heading into a strong seller's market again with home prices on the upswing and a strong decline in available inventory.

It's pretty tough out here

2009-04-16T17:41:00.000-07:00

Well the good news is that many homes are selling for 50 to 60% of what they had sold for in 2005 to 2006. This really means that buyers have a lot of options available and they can now buy homes that were completely unavailable to them a mere 3 years ago. The other good news is that interest rates are insanely low, anywhere from 4.625% to 5.55% depending on the program, the down payment, the points, and your particular credit worthiness.

The bad news is that most banks are still looking for excuses as to why not lend to you. Buyers should do everything within their power to make themselves as mortgageable as possible since we have now reached what I call the "Perfect Storm" of Real Estate. We now have very low prices coupled with very low interest rates. This is an awesome time to buy if you can. Best of luck to all of you!

The Questionable Fairness of the Obama Stimulus Package

2009-02-21T11:18:00.001-08:00

First the good news:

It's good to have a President that can assess a situation and move quickly to try to fix a known problem of enormous magnitude namely the Real Estate and Mortgage MESS.

I am glad that many existing homeowners who have fallen on hard times will get the opportunity to remain in their homes because they now will be able to get their interest rates automatically reduced and may also get part of their loan balance forgiven. That sounds nice but it also reeks of a Giant Government "Gimme". What bothers me the most about this plan is that there is no way to separate the people who deserve a "hand up" with the people who are just getting a "Free ride". I, personally witnessed many greedy home buyers who bought homes that far exceeded their current earning abilities yet they did so with impunity because the "System" in place was one of letting Capitalism run amok. It is the system still favored by NeoCon conservatives. Now don't get me wrong, there is something to be said for the market being able to self regulate itself based on overall profitablity coupled with supply and demand but the problem with greed is that it completely blinds all parties.

Now for the bad news: Part of the "Stimulus Package" that the solid, fiscally conservative, law abiding, mortgage paying population will be paying for is the support of those same greedy people who felt that they deserved a "McMansion" complete with gunite pool and spa, yes folks, the very same people who had poor judgement in the first place.

Let me make this very clear, I have a problem with bailing out greedy self indulgent people who shouldn't have bought what they bought in the first place!

I do not have a problem with people who, due to unfortunate circumstances such as health problems, the death of a loved one, a messy divorce or the loss of a job, end up needing a helping hand. These families need our help and I'm happy that the "Stimulus Package" will provide that "hand up".

In the past several months I have witnessed many good mortgage paying people unable to refinance their mortgage down to a lower rate because their equity has slipped away and lending regulations have gotten tighter than a tourniquet. Our former Prez, Bush the 2nd, gave the banks billions and yet those very same banks suddenly won't lend to the very same people who have already proved that they can pay a mortgage on time. Now that is what I call UNFAIR. If the government is so big on handing out billions where's my cut of the pie? Countless clients of mine can not refinance their mortgage to take advantage of the lower rates while countless numbers of people who haven't paid their mortgage in over a year are able to refinance with no closing costs into an outrageously low mortgage rate. This is NOT FAIR. How about the government rewarding those people who did not contribute to the current mess? How about giving them a "Gold Star" and a means to participate in this giant government give-a-way? Anyone who has systematically paid their mortgage, on time, throughout this time in history, should get an automatic "Free Pass" that could be redeemed for at least a 1% interest rate reduction and maybe a cherry on the top which could be a $25,000 downward loan modification. Now that would be a fitting way to reward people who did not contribute to the current mess we are in. What do you think folks?

Fundamentals are what count

2009-01-15T12:52:00.000-08:00

I've been meaning to get this topic off of my chest for awhile so here it goes..... Everyone, including the papers, the pundits and now the politicians say we are in a bad economy, right? So why is it that when I call a company for service they don't get back to me or lose my information? I'll give you an example of this. I called a permit expediting company several months ago because I thought I needed professional help in legalizing a structure. I left not one but two messages w/the receptionist and I never received a call back. Here's another interesting story, I ordered an oil delivery for a home of mine that is tenant occupied and asked if I could purchase a service contract for said home. I was told that one of their service technicians would need to look the burner over before they would agree to give me a service contract to make sure that the burner had no real problems. I scheduled the appointment between the service technician and my tenant. I never received a follow up call to let me know if I would be eligible for a paid service contract. 6 Weeks later my tenant tells me that the heat just stopped working so I called back this company to schedule in a service call and they said that their service technician had no interest in fixing my burner even if I agreed to pay them in full for parts and labor. I was completely shocked that a company that is in the business of fixing oil burners had no interest in taking my money and fixing my heating equiptment. I promptly called another oil delivery/service company and had my oil burner fixed w/in 4 hours at a total cost of $199. This excellent company is Taylor Fuel and I am now a grateful customer of theirs while the other company will be on my blacklist. What I really think is that good businesses have good fundamentals and some how they will weather the economic storm while businesses w/poor fundamentals will go out of business and it will not be the economy's fault it will be their own damn fault.

The same lesson can be applied to home buying. Fundamentals count. The reason we are in such a foreclosure mess is that the average home buyer threw fundamentals in the garbage. They just wanted what they wanted, when they wanted it, especially if their friend or cousin had it. I saw people get into bidding wars on 2 bedroom homes in so so locations. I saw buyers overlook their own inability to make a mortgage payment just so they could say they owned a home.

Today's buyer is just plain afraid. They are afraid of making the same kind of mistakes that thousands before them made. They are afraid that they won't get mortgage financing. They are afraid that they will lose their jobs. I understand this fear however it was once said that "the only thing to fear is fear itself". Fear is there to make you think things through and not leap before you look which is a good and healthy thing. Fear that prevents you from making meaningful and positive decisions and choices is just baseless fear that paralyzes. Once you have analyzed a situation properly it is time to make a decision based on fundamentals and get on with it. Waiting for the sky to fall like "Chicken Little" is no way to live.

Have a Happy Holiday Season!

2008-12-21T07:45:00.000-08:00

Well it's that time of year again when most of our thoughts turn to holiday festivities and holiday stress. I have definitely noticed a more somber attitude this holiday season due to the overwhelming financial pressures that face most of us. Big retailers are having sale after sale and yet are selling less. Internet retailers are offering bigger and better bargains and even free shipping. It's a pity that there seems to be so much pressure on people to make sure that they buy plenty of gifts for everyone. Maybe it's time to return to simpler values like baking a plate of Christmas cookies and giving them as a gift instead of just spending more and more money that you don't really have to spend.

One of the nicest traditions I have is that every year I get together w/an older woman that I became friends with while working at Fire Island back in the late 80's. I drive over to her home and sit awhile in her cozy living room and look at old photos and reminisce over people we knew who are no longer with us. We then go out to dinner at a local restaurant and talk some more. We usually give each other a very small gift like a poinsettia plant or a home baked batch of cookies. We always have a lovely time just catching up with each other once a year over the holidays. I find that the gift of time is far more precious than any silly trinket or electronic gadget that I probably don't need anyways. Make time for the people in your life that are special to you for one day they may not be there anymore and all you will have to hold onto are the memories you made together.

If you are fortunate enough to have a roof over your head than you are more fortunate than most of this planet's inhabitants. Be thankful for what you've got even if it is less than you had hoped for. For better or worse we live in a country that idealizes "stuff" and the message we are constantly being bombarded with is that the more "stuff" you have the more successful you are. It's time we realized that "stuff" doesn't last only memories do. We are all just caretakers in this life. We buy jewelry, we buy homes, we buy cars and then we pass on and our "stuff" also gets passed on. We are just temporary caretakers and the best we can do is take good care of all that we have and realize that all we have is enough to be grateful for.

So this holiday season give the gift of time and the gift of appreciation. That's the "stuff" that memories are built upon. Wishing you and yours a most joyous holiday season!

Hope over Fear

2008-11-05T06:56:00.000-08:00

Our country finally did it, we chose hope over fear. A new day is dawning for America and it couldn't come at a better or bleaker time. We will have new leadership in the White House and we will have a thoughtful and intelligent President who was voted in by a majority of us. Things will not change overnight, it took time and many poor decisions to get us into the mess we are in now and it will take time and many good decisions to get us out of it. Still, this is really, really big history in the making and I couldn't be prouder to be an American then I am today.

What will this mean for the housing and financial sectors? It will mean that government will have an eye on the ball and will start to look out for the middle class instead of just big business, as usual. It will mean that consumer sentiment will start to become positive again. It will mean that foreclosures will no longer be on the rise but on the decline. It will mean that jobs will come to depressed cities like Detroit and Columbus. It will mean that banks will start loosening their tight grip on money and the credit will start to flow again into the hands of small businesses and home buyers. It will mean that our economy will start to create more good jobs instead of just outsourcing them out to foreign countries. It will mean that the super rich will start paying their fair share of taxes instead of the middle class bearing the burden. In short order, it will mean better times are ahead of us instead of just behind us.

Things are looking up, my friends, it is time to be hopeful again!

Tricks or Treats?

2008-10-29T07:34:00.000-07:00

Well, my pretties, with Halloween approaching, it is time to think of Trick or Treating. When you are going door to door asking for candy, will your neighbors answer their door and hand you a treat or will they be chained to the door hoping to stave off foreclosure. These are awful times for many homeowners and while the average "Joe the Plumber" says that they do not want government interference in their lives it is time the government really does something to help out all the struggling homeowners who are barely holding on. More foreclosures mean more blighted neighborhoods and more people feeling suicidal and helpless. For years the government looked the other way as big business helped themselves to monstrous profits (and still do like Mobil/Exxon) at the expense of the little guy.

You know what I consider an insult to American intelligence? Paltry economic stimulus checks that give some Americans between $100 to $1800. To further add insult to injury, our current President thinks that Americans who receive these checks should go out and spend them in this insipid hope that buying more consumer goods will beef up this dismal economy. What a complete pathetic joke. How about giving us "Real" economic stimulus checks like the 700 billion dollars that you handed out to the very same corporations who have been ripping us off?

Think about what the average American family could do with about $350,000? Now that would really help people and put our economy back on track. Foreclosures would dry up, consumer confidence would spread, money would be spent on housing, cars and other consumer goods. Small businesses would prosper once again and all would be right with our economy. The housing market would stabilize and new buyers would be able to get mortgages again. Older homeowners who previously could not sell their home would now be able to ride off into the sunset (into their Florida or North Carolina retirement homes). Blighted towns like Mastic Beach would come alive again and attract new buyers wanting to set down roots in a well priced beach community. All would be right with the world. Now, my friends, that's what I would call a real "Treat"!

How Safe is the Middle Class?

2008-09-17T06:50:00.000-07:00

A couple of nights ago I was watching the news and heard that banking giant, Lehman Brothers would be filing for bankruptcy. The other big news of the evening was that Merrill Lynch was probably going to be bought by Bank of America and that AIG (the insurance giant) was also in danger of going out of business.

I receive an online publication called "The Mortgage Graveyard" and for the past year and a half more and more banks have been added to that list. I couldn't believe it when I was directly e-mailed, by my account executive at Indy Mac, last month, that they too were going out of business. Right now there are very few banks left to do business with. The real scary part of all of this is that if you happened to have over $100,000 in Indy Mac Bank, you were in danger of losing your money.

Trying to get a mortgage in this lending environment is like pulling teeth. It's hard, uncomfortable and will cause you a whole bunch of pain and that's if you are lucky enough to find a decent dentist.

Now, you may ask why is it just the middle class that aren't safe? My attorney and friend, Paul Barlow, neatly summed it up when he said "the poor don't have any money to begin with and the rich always have money. It's the middle class like you and me that always get squeezed".

He's right, the rich never have a problem buying homes and the poor are happy just to have a roof over their heads. It's the striving middle class that dream of home ownership and take the steps necessary to achieve those goals that are in danger of being squeezed out. It's also the middle class who will be losing their well paying jobs at "Lehman Brothers, Indy Mac, AIG, Merrill Lynch, etc". Those nice middle class salaries will be very hard to replace in a failing economy, such as the one we have now, which was created by our wonderful Republican President George W Bush who has systematically catered to his very rich corporate cronies like Ken Lay who pilfered the pensions of the loyal, hardworking middle class employees of Enron. I pray that we can get our country back on track and back on it's feet so that we can once more have a strong economy and a healthy environment. Four more years of the same and we will be in for a depression instead of a hard core recession.

When the middle class feels safe and consumer sentiment is positive we all share in a strong economy. We are anything but safe right now. These are, indeed, very scary times.

The Credit Slump

2008-08-12T09:09:00.000-07:00

One of the more obvious reasons that we are in the midst of such a housing crisis is that the same banks who had no problem lending money to anyone who could fog up a mirror now seem to have a problem loaning money to very viable purchasers. We will not see a complete housing market turnaround until credit starts to become more readily available.

Bank after bank is going out of business and the requirements necessary to obtain a mortgage have become herculean in nature. Is it any wonder that so many homes are languishing on the market? I still believe that there will always be people who want or need to buy a home for their family however it has become exceedingly difficult to qualify for a mortgage.

There are many very good deals on houses that can be had if you can get a mortgage or you are fortunate enough to have an ample supply of cash. Every day there are houses coming onto the market that are priced at 50 to 60% of what they sold for back in 2004-2006. Imagine buying a home that sold for $450,000 in 2005 for $225,000 today. It's out there but the catch is you must be able to get the financing.

REO's or Short Sales?

2008-06-16T12:01:00.000-07:00

Do you know that most people including real estate agents have no idea what's the difference between REO properties and short Sales? You are probably asking yourself why this matters. The reason this matters is if you are a buyer and are looking for a really good deal you will undoubtedly come across both of these types of listings. You will also probably think they are the same thing. This will be a big mistake since they are not the same thing.

REO properties are properties that are currently owned by a corporation which may or may not be a bank. Short sales are properties that are still owned by the current seller who owes more money to their current mortgage holder than the property is worth. For example, say a seller bought their home in 2005 and paid $525,000 for it and took out an interest only loan for 100% of the value. They now owe more than $525,000 on their mortgage yet the current market value of the home is only $375,000 and they need to sell immediately. This property becomes a "Short sale" since the money they will get from the sale will not be enough to pay off the current mortgage holder who must then approve this sale at such a reduced price. This process can take months to accomplish and then sometimes at the last moment the deal can still fall apart. Buyers must be aware of the substantial risks they are taking by entering into a short sale contract with a seller who ultimately can not make the final decision on whether to accept a reduced price on their property.

On the other hand, an REO property is typically a property that a bank or corporation owns after they have foreclosed on the prior owner who has typically failed to make their mortgage payments. The buyer who chooses to purchase one of these properties are typically buying them in "as is" condition and are negotiating through a real estate agent who makes the offer directly to the bank or corporation which is typically a very motivated seller who can make a final decision quickly.

Good and sometimes great deals can be had in either above situation but it is prudent for a buyer to be very aware of the differences and challenges that each situation can present.

Have we hit bottom yet?

2008-04-29T12:53:00.000-07:00

The question on many peoples' minds is "Have we hit bottom yet?" This is not an easy question to answer. My belief is that there are some areas in the country that have not hit bottom yet and there are others that are darn near close. On Long Island we have seen some drastic reductions in price compared to just one short year ago. Homes that had sold for $400,000 in early 2007 are now selling for $300,000. For buyers this should seem to be good news however there still is a segment of buyers sitting on the sidelines waiting to see if the market will fall even further. My belief is that there still is some room for further price reductions in certain market areas however in other areas the price is probably close to bottom. Smart and motivated buyers are now in the position to scoop up homes that should far exceed their previous expectations. I have seen w/my own two eyes some pretty amazing deals. I would also like to point out that these incredible deals have been noticed by buyers since they have generated bidding wars with full and over full priced offers. I know that many people will find this hard to believe considering our current market environment but it is true.

Yet the news continues to sound ugly. Today's news pointed out that 1 in 194 homes had foreclosure notices filed. Home prices are down 12.7% through February 2008 and consumer confidence sank to a 5 year low.

Most people tend to become frightened when they hear this news and fright and fear breed inaction which causes the market to further stagnate. When I hear this news I tend to have 2 reactions. My first reaction is sadness for all of the homeowners out there who are losing their homes and all of their neighbors who will be stuck living next to a foreclosed property which can attract vandalism and blight. My second reaction is excitement over the many possibilities for well qualified buyers to get into their first home or the trade up home of their dreams. Home prices have finally fallen to realistic levels where the average person has a shot at home ownership without having to work 80 hours per week just to pay the mortgage. We have now entered into a time of wonderful opportunities for the next generation of home owners. I'm happy to say 'it's about time'!

How to fix what's broken

2008-03-29T07:05:00.000-07:00

It seems as if Long Island is losing more buyers than it is gaining. Why is this happening when we all know what a beautiful place Long Island is? The short answer can be found in our ridiculous property taxes. It seems that even if you are one of the lucky few seniors who have paid off your mortgage, so what? You still will most probably have to pay real estate taxes that may be in excess of $1000 per month and you can still count on outrageous homeowner's insurance policy costs associated w/our living on an island. Heck, those wonderful companies like Liberty Mutual and State Farm decided to arbitrarily cancel people's policies even if no claim for damage was ever filed. The insurance companies cited too great a risk to insure in a coastal area. I guess Hurricane Katrina really woke them up.

Now back to our criminally outrageous real estate taxes.......... Do you know that real estate taxes on Long Island bear no resemblance to real property value? I'll give you some actual examples. How about a 3 bedroom, 1 bath ranch home w/no basement and no garage in Mastic selling for $151,000 that has real estate taxes of $7300? How absurd is that? If you were to purchase that home and put 20% down on it your actual principal and interest payment would be less than the combined cost of your real estate taxes and homeowner's insurance. Ooh wait, I have another example for you, how about a foreclosed 4 bedroom cape in Central Islip with an asking price of $199,000 that sports real estate taxes of $12,000? Now I ask our wonderful politicians out there, who the heck is going to buy a resale home (not new construction) in Central Islip that has taxes of $12,000????? Guess what? The NYC millionaire who wishes to buy a summer home in Southampton that is three times the size of the Central Islip home will only have to pay $9000 in real estate taxes. Where is the equity in that?

The lower middle class and the middle class are gettting squeezed out of home ownership by our elected politicians who refuse to make any meaningful changes to our outmoded system of real estate taxation. There tends to be neither rhyme nor reason when it comes to assessed valuation. It's high time that changes.

People want to buy on Long Island but not at a price they can't afford. Now that our home prices have fallen to more realistic levels isn't about time our real estate taxes also decrease to realistic levels?

Can you trust the news?

2008-03-25T11:53:00.000-07:00

It seems that everyday there is some more news concerning the housing market. Yesterday the news appeared to be good, more buyers were getting back into the game. This news caused the stock market to rally. Today's news wasn't so good. Home prices fell to historically low levels with the average market dropping more than 10% from last year with Florida and Nevada suffering losses of close to 20%. Yesterday's good news had the National Association of Realtors saying that prices may begin to increase in the second half of 2008. Today's bad news had other industry experts saying that we haven't hit bottom yet.

Who are you going to believe? Watch out for the National Association of Realtors since they have a vested interest in promoting a healthy real estate market even if the facts do not support such a rosy picture. Beware of the Harvard and Stamford educated economists since they are way too busy sitting in their ivory towers pontificating on the world at large. They are not on the front lines and the data they base their decisions on is usually at least 6 months old so therefore they can not see trends happening.

In America, our idea of news is more closely related to gossip and innuendo than it is to real facts and real trends. Before you decide who to listen to, regarding real estate news, try listening to your own needs first and base your decisions on those needs not the news of others.

Foreclosures, Short Sales and Desperate Sellers

2008-02-26T12:20:00.000-08:00

As an active Real Estate Investor and Buyer's Agent I have the opportunity to view a whole lot of homes (via MLS) on a daily basis. What is very interesting is that there are many homes that have been on the market for a very long time and they are dropping in price in gigantic increments. It is no longer unusual to see $50,000 to $100,000 price drops. Many of these properties are either in foreclosure or going into foreclosure. The banks holding these non-performing loans in their portfolios are getting pretty antsy about being long term property managers. At first they were not very amenable to deal with when trying to put together a short sale but slowly they have been coming around. I still find it easier to deal directly with very motivated sellers who are not in foreclosure but really do need to sell. Many good deals can be found this way if you know what to look for. I often employ my own buyer's agent when I am interested in a property since this saves me time and money. They will go out and preview up to 6 houses per day for me and submit offers on whatever ones sound good. They get paid a commission from the sale and they are extremely helpful when it comes to negotiating in my best interest. It is also very helpful to be removed from the negotiation if you are the buyer. This practice puts a third party negotiator in the middle of the deal so nothing becomes too personal when going back and forth on terms and price.

I know a lot of buyers are still sitting on the sidelines waiting for home prices to drop even further. I, too, agree that this will happen however there are always good and even great deals out there. Waiting is not always the best strategy unless you are sure that you are the best market timer in history. Even for us professionals, it is difficult to gauge the top of the market when one should sell and the bottom of the market when one should definitely buy.

Enjoy what's left of Winter and get your garden trowels ready for Spring.

Happy New Year!

2008-01-04T13:32:00.000-08:00

Greetings everyone. I am thrilled to be alive and well and still practicing real estate. It's been a difficult past year in the market place. Lots of changes have taken place and are still taking place as we speak. It's much more difficult to get a mortgage today however the interest rates are very low which should be very attractive to anyone who plans on buying or refinancing in the next few months. I do not see rates trending higher since the economy is in the dumps and there is a political election coming up this year. If anything, rates will trend slightly lower. That's very good news and then home prices have dropped quite a bit so this is a perfect opportunity for buyers who have sat on the sidelines, saved up some money and have decent credit. Buyers who are able to easily get a mortgage or who have lots of cash will truly be in the catbird seat as this year hums along.

There are so many choices in housing today available to well qualified buyers that shopping for a house is a little like being a kid in a candy store. This is also an awesome time to be an exclusive buyer's agent. I just love being able to negotiate from a position of strength not weakness. Listing agents are literally falling over themselves trying to be nice and cooperative when we show our buyer clients homes. One of my agents just put together a great deal today and the listing agent profusely thanked her for bringing such a good buyer. This is all good news for the intelligent and well qualified buyer since they will be able to obtain excellent representation and in most cases it will not cost them a dime since all commissions are included in the purchase price. This really is a great time to be a buyer since it is as if all the planets are in alignment.

Well I wish everyone a happy, healthy New Year and a home of one's own.

Home for the Holidays

2007-12-17T10:59:00.000-08:00

Well, Tis the Season. So what will be under your Christmas tree or your Chanuka bush? It is that time of year when everyone is in such an utter state of panic to make sure that holiday cards are sent out, presents are bought, travel plans are made and menus are planned that most of us forget the true purpose of the holiday season. It is a time to reflect back on the past year and to also look ahead to the New Year. It is a time for gratitude and appreciation for all that is in your life and all that can be part of your life.

This time of year can be difficult for many of us because of the losses that may have occurred during the past 12 months. Still, if you truly look around, you can find enough blessings to be grateful for. If you have a roof over your head you are luckier than many people. If you have enough food to eat and clothes to wear you have more than others in third world countries. If you have someone in your life that loves and cares about you than you are truly blessed.

Money may be the currency of countries but love is the currency of our souls. Take some time out from all the running and mad dashing from store to store this season and reach out to someone you haven't spoken to in awhile. Send a check to a charity you believe in. Volunteer your time if you don't have enough money left over to write that check. Give your family the gift of time which will always be treasured more than another toy or video component.

Turn you house into a home by making sure that there is always love and laughter within your four walls. These are the things that are remembered way after the season has come and gone.

Wishing you and yours a most memorable holiday season,

Bethany

A Tidal Wave of Doom and Hope

2007-11-14T10:18:00.000-08:00

Every day the news get a little worse. The War in Iraq is still claiming lives on a daily basis. Suicide rates are jumping for returning veterans as well as their homeless rate. Foreclosures are at their highest level in years. The National Association of Realtors have forecast that we will be in for another tough year. Every day I get a call or two from desperate people who need to refinance or sell their homes. Every week I get a new notice from another bank I've done business with that says they are no longer in the business of loaning out money and writing mortgages. Consumer confidence is hitting some serious lows and the retail businesses are bracing for the worst holiday season ever.

Will this snowball of doom and gloom ever end? Of course it will. It always does. The War will eventually end. A new President will be chosen. New business technologies will emerge. Banks will begin loosening their credit requirements again. People will begin selling their homes easier and faster. Buyers will start to buy again with confidence. The cycle will start all over again. This is the way it has been for ages and the way it will be again. There is just so much doom and gloom we can take as a species before we create lasting paradigm shifts in our reality. The time is coming and it will be here before you are even aware of it. Concentrate on one good thing you can do for yourself or others and the good times will be here sooner than later.

How Our Government Wastes Our Money

2007-10-09T14:59:00.000-07:00

I normally don't get into discussions on social service programs but I find the following information to be totally disgusting. Did you know that there are countless families living in homeless shelters on Long Island right now? Did you also know that there is no need for many of these families to live in such overcrowded and awful situations? Here is the problem in a nutshell. A family gets into financial difficulty because they don't make a lot of money. They get paid minimum wage and this is not enough money to cover the costs of an average 3 bedroom rental which typically rents for $1700 to $2000 per month plus utilities. Remember these are hard working people who just don't have the skills, education or temperament to make a decent wage. Their options are to get government subsidies so they can afford to pay the rent on a home or an apartment or to end up in a homeless shelter.

The paperwork required to get into one of these subsidized programs is daunting and the waiting list can be months or years. If you fill out a form and miss one question the paperwork is returned to you and the process starts all over again. The government pays somewhere in the vicinity of $4000 per month for a homeless family to live in one bedroom in part of a home that has been converted into a homeless shelter. So, let's see........... do the math, an average 3 bedroom home converted into a homeless shelter receives $12,000 per month from the government while landlords that have perfectly decent 3 bedroom homes available for rent may end up having their homes sit vacant for months until a tenant is found. What kind of sense does that make????

I have an idea to change this system but no one wants to hear it much less implement it. We could have a centralized list of landlords that have available housing and tenants that need available housing. DSS (Department of Social Services) and SSP (Shelter Supplement programs) and Section 8 could be more consistently and adequately funded and paperwork could be streamlined. The rent guidelines for payments could be increased to represent fair market value to landlords willing to rent to those on such government programs. Townships could stop making it so darn difficult for landlords to pass inspections. It has become normal in the town of Brookhaven for 3 separate inspections by 3 different agencies to happen on one home before it may be considered to have passed inspection. For G-d's sake, my own primary residence would fail their insane inspections. Meanwhile all this red tape is happening while poor families languish in unsafe and unsanitary conditions. I frankly find it deplorable. It's time for a change.

Deal or No Deal?

2007-10-01T10:23:00.000-07:00

It's getting awfully tough to find ready, willing and able buyers these days. It's getting very easy to find desperate sellers. Yet so many buyers are still sitting on the sidelines waiting. I wonder what they are waiting for. I went out to look at several properties this past week and I saw some pretty good deals. I just put in an offer of one of those homes. I looked at another home this morning w/a good friend of mine who wants to get into the real estate game of investing. We both liked what we saw and will most probably be putting in an offer on this home after we run the numbers to make sure that there is still plenty of profit left in the deal after we rehab the home. This is a very good time to hook up with a very knowledgeable professional team that can make your dreams of home ownership or real estate investing come true. I predict that in 10 years from now most of the properties that will be bought from 2007 to 2009 will experience a tremendous rate of return and those of you who are smart enough to be one of those buyers will look like geniuses. The beauty is that not only will you seem brilliant but you will also be wealthy, now that's a great combination that really works for me :)

Crash and Burn

2007-08-17T10:17:00.000-07:00

Well Folks, this is some market we are in isn't it? I predicted this kind of scenario would happen years ago while other industry professionals just kept spouting the party line which was 'Long Island will be insulated from a downturn in the market'. I know that real estate and mortgage markets are cyclical in nature and whatever goes up must invariably come down. How about all those other professionals talking about a very soft landing? Take a look at the mortgage market and anyone can see that this is not a very soft landing instead it is a crash and burn. Of course, there are a multitude of reasons why this is happening and the most obvious one is that greed breeds stupidity. Wow, that kind of sounds ugly, doesn't it? So many prospective home buyers thought that the market would keep going up and up and were willing to overpay. So many banks believed the same exact thing and were willing to lend and lend even when they knew that some borrowers were more than questionable. So many real estate agents just didn't care about putting people into homes that they knew they couldn't afford. So many loan officers also didn't care about the people they were getting loans for and didn't seem to mind that these same people would not be able to make the payments. All these greedy people cared about was getting their commissions quickly and moving on to the next deal. Many buyers were also stupid. They didn't do any due diligence when it came to the real estate agent or loan officer they were using. They never bothered to even use a simple calculator to see if they could truly afford the homes they were looking at. As they say in a court of law, "Ignorance is no excuse". I had several real estate agents refer me mortgage loans, after they had found buyers a home, which I had to turn down. The reason I turned down such lucrative opportunities was that I couldn't, in good conscience, put someone into a home that I knew they couldn't afford, even though they thought they could afford it. I'll bet anyone 'dollars to donuts' that some other loan officer was more than willing to write the deal and capitalize on buyer stupidity. I'll also bet money that this buyer is now facing foreclosure. It's all a shame since everyone seems to be losing out in this market place. Sellers can't sell their homes for what their neighbor's sold for in 2005, not even close. Buyers who bought in 2004 to 2006 will see declining equity. Borrowers who are in dangerous 2/28 adjustable rate mortgages will see their payments increase dramatically and not be able to refinance due to either credit issues or the decline of equity. Bank after bank are shuttering their doors. Mortgage money is getting hard to come by and rates have been trickling up. While this may sound like quite a dismal picture it actually does have a silver lining for some intelligent, educated and motivated people. For sellers, at the right price anything will sell. For buyers, there are plenty of good homes w/desperate sellers out there. Interest rates are still near 40 year lows and if you have good credit and a little bit of money you can still get a good deal on a mortgage. As always, I'm sure most people will sit on the sidelines and wait for something or someone to tell them that it's ok to buy again. Most people are followers not leaders. For those of you who are not swayed by popular opinion, the time to get some serious values in the real estate market is already here and will continue to be here for quite awhile. Ready, set, go!

So what are you waiting for?

2007-06-29T11:20:00.000-07:00

Well, I don't know about you folks but I sure do like the direction home prices are heading in. On Long Island the average home in Suffolk County has drastically dropped in value. Nassau County is just lagging behind but still dropping and Queens County has just begun to drop in price. I just love a good deal and there are quite a few to be had right now. Homes with basement apartments in Central Islip are now selling for below $300,000 when they had sold a year ago for $350,000. High ranch homes in Lindenhurst which had sold for $450,000 a year ago are now selling for $390,000. An attached brick townhome in Queens Village which had sold for $435,000 a year ago are now selling for $400,000. A large split level in south Baldwin which sold for $585,000 in 2005 is now selling for $490,000.

Yet there are not a lot of active buyers in this marketplace. Many buyers seem to be waiting on the sidelines for something else to happen. My advice is that if you can afford to wait a litttle longer and save up more money so that you can get a better mortgage then keep saving. If waiting won't help you save up any more money and you are tired of renting or living in your in law's basement apartment, then just do it! Take the plunge and start to investigate the housing market. You will never know what you've missed out on unless you begin educating yourself.
So I ask you, what are you waiting for? Jump in, cool off, the water's just fine.

A Sad and Cautionary Home Buying Tale

2007-05-11T13:27:00.000-07:00

Yesterday I met w/a lovely man who is facing foreclosure. He had bought a home for him and his family less than 2 years ago. He wanted to be in a good school district so his children could get a better education than they were receiving. He wanted a nice backyard where they could play and he could bar-b-q. He dared to dream the American dream of home ownership. He felt that somehow he would be able to manage the mortgage payments but he never did the math. The real estate agent that he had used was all too happy to make sure he could buy the home so he could make a sizable commission. The mortgage company that he had used was also happy to be making nice big juicy fees on the loans. It looked like the proverbial "win/win" situation but unfortunately for this nice man, now facing foreclosure, it was not. What went wrong? Well the answer is really quite elementary. The nice man was overly optimistic about his earning potential and the real estate and mortgage professionals didn't care enough to be honest and say to this man that he should have been looking to buy a less expensive home w/lower taxes. Does this scenario ring true for any of you reading this? It's really a pity and it need not happen.

Home Buyers, do your home work! Do the math. Work with honest and reputable professionals who will be looking out for your best interests and not their own. Try an exclusive buyer's agent who will build a solid team of experts for you.

Wishing all of you a very Happy Mother's Day Weekend.

Build Your Team

2007-04-10T10:00:00.000-07:00

I am often asked by journalists what the most important thing a home buyer can do to get ready to buy. My answer is "Build a solid team of professionals that work for you not the seller". When you as a home buyer start looking for homes, too often, you contact the listing agent for information. The next thing you know, the listing agent is showing you their own listings and inducing you to make an offer. Once that happens you are already on a speeding train about to jump the tracks. Assuming you get your offer accepted, it's now time to put your money where your mouth is. Do you have an attorney? Are you going to get an engineer's report or a home inspection? Will there be a termite report? When will it be ordered? Who will be your mortgage broker or banker? How much financing are you qualified for? Will it be enough? What will your payments be? Will the house appraise for what you are paying? Can you afford your monthly mortgage payment? Are the real estate taxes verified? Will there be C/O (certificate of occupancy) issues? Are there title issues?

Is it any wonder that buying a home is considered one of the three most stressful events in one's life? Take your pick; death, divorce or buying a home?

Wouldn't it be wonderful if most of the stress in the home buying process could be eliminated?
Well it can be!

The choice is yours. You can either do things the old and stressful way as discussed above or do things the intelligent way which will remove most of the stress. It's time to build "Your Team of Professionals" who will be looking out for your needs and interests not the sellers or their own.

Your team should consist of an experienced: Exclusive Buyer's Agent; Real Estate Attorney; Home Inspection Engineer; Termite Inspector; Insurance Agent and Mortgage Broker. These are the professionals who will make a huge difference in your life. The Exclusive Buyer's Agent will make sure you are getting the best home posssible in the best location for the least amount of money. The Real Estate Attorney will make sure you are protected by the terms of the contract. The Home Inspection Engineer will make sure that all problems that may not be obvious to the naked eye will be uncovered so that you do not buy a home that has more problems than you bargained for. The Termite Inspector will make sure that you are not buying a home that is infested w/insects. The Insurance Agent will make sure that you paying for just the amount of coverage that you truly need. The Mortgage Broker will make sure that you can afford the payments on your home and search for the best rate and the lowest payment available. All these professionals will be members of your team and as members of your team they will be actively looking out for your best interests not the sellers or their own.

Do yourself a favor, become a "Smart Buyer" today. Call your nearest Exclusive Buyer's Agent today and get the ball rolling! They will be happy to help you "Build your Team" so you can get on the road to a stress-free home buying experience.

Scary News from the Trenches

2007-03-14T11:59:00.001-07:00

Well Folks, the times they are a changing and so must we. It's hard to turn on a television or radio these days and not hear tons of doom and gloom about the housing market. The big news has been that Subprime banking giants like Fremont Investment and Loan and New Century have ceased to do business. How does this news impact you? How does this news impact me? Well for starters this means that there are less players in the market competing for business and that usually spells higher rates for consumers since there is less competition. Within the last 5 years one of the largest segments of lending involved 100% financing and now this financing will be very difficult to obtain and therefore more costly to the consumer. The trickle down effect is that there will be less buyers that can purchase homes and more sellers trying to unload their homes. Many sellers who had bought within the last 5 years had done so with the assistance of 100% financing and now that the real estate market has taken a downward turn these sellers may not be able to sell their homes for what they had paid. If sellers can't sell and many buyers can't buy then we will all have a very real and frightening problem. My prediction is that we will start to see many more foreclosed properties even in solidly middle and upper middle class neighborhoods. Still all is not bleak for there are always silver linings amongst the clouds for some. As I said in my Newday interview( Business Section page A49 and A50) yesterday with Jim Bernstein "It just depends on how you position yourself". Money is made in all kinds of markets if you educate yourself and position yourself to work with knowledgeable people who will have your best interests at heart. As a Realtor who represents buyers exclusively, I am really looking forward to this brave, new marketplace. Buyers who are smart enough to hire us will be able to get some really good deals on homes and not have to worry that they will be overpaying. Welcome to the new Buyer's market!

Short Sales on Long Island

2007-01-30T12:16:00.000-08:00

There has been a recent development in the Long Island marketplace that hasn't been seen here in a very long time. That development is called a "Short Sale" and that is the technical term that real estate and banking professionals use when describing what happens when a homeowner is in foreclosure and they can not sell their home for what they owe the bank. The reason this phenomenon is relatively new is that instead of home prices rapidly appreciating as they have done consistantly for the past 10 years they have now begun to depreciate. Let's say you bought your home at the height of the market last spring and paid $500,000 for it. In order to keep your payments affordable you took out an interest only mortgage and have been making the minimum payments ever since. Let's also say you availed yourself of 100% financing. Here you are 10 months later and you now owe $506,000 on your home. For some reason your financial situation has worsened and you can no longer afford to make even the minimum payments on your mortgage so you decide to sell your home so your credit does not spiral further downward. Guess what? Your home is no longer worth $500,000 it's now worth $475,000 and you still owe at least $506,000. You are now faced with some very ugly choices. You can pack up all your bags and leave while the bank forecloses or you can hire a professional real estate agent who has experience in "short sales" and will negotiate directly with the bank on your behalf. The "short Sale" will at least preserve your credit and may even allow you to walk away with a drop of money and your dignity more or less intact. The lesson to be learned from all of this is that you really should try not to get in over your head when you are looking to buy a home. Stick to your budget. Be realistic about your income. Keep some money tucked away for an emergency. Hire an exclusive buyers agent to negotiate the lowest possible price and best terms on your purchase so that at least you are not overpaying from the get go. Use an honest mortgage consultant who comes recommended and advises you properly. Make sure you get a home inspection report so that you can budget for expenses like a new roof or new windows. Know what you are getting yourself into before you do something foolish like buy the house next door to where you live just because you think you are getting a good deal. I have seen this kind of good deal completely backfire on the buyer because more often than not, the house next door is not a good deal. Know what you are buying and know what it is really worth. The last thing you want to become is a foreclosure statistic.