By Katie McKasky, Feb. 19th, 2010  Filed Under: Design, News, Cities

Southern California residents have not one, but two thousand more reasons to rip out their water-wasting turf: a check in the mail.

The Los Angeles Department of Water and Power (LADWP) and a handful of other utility companies are paying SoCal residents to rip out their suburban lawns. In exchange, homeowners are required to replace grass with drought-tolerant, native plant species or install permeable surfaces which filter water back into the ground. Common permeable surface choices include flagstone, brick, and gravel. The rebate is $1 per square foot, up to a maximum of 2,000 feet.

The process works like this:

Cyberhomes blogger Marcie Geffner writes:

The rebate might not be enough to persuade homeowners who really love their lawns. But for me, the offer was a no-brainer as I wanted to replace my big boring lawns with flagstone walkways, cactus and other plants that are more natural to the climate, if not necessarily native.

Other water-saving rebates available through LADWP include incentives to replace toilets and clothes washers with high-efficiency models, timer controlled irrigation, and pressure-reduced sprinkler nozzles. If you’re willing, there is even a rebate for installing synthetic turf.

Check with your local utility company or DSIRE.org to see what environmentally-conscious rebates are available in your area.

Sheila Bair, chairwoman of the Federal Deposit Insurance Corp., which reported the numbers, attributed the biggest chunk of the decline to lending cutbacks by the largest banks as they tightened loan requirements and put aside larger reserves, according to The Washington Post.

There was also some encouraging news. Commercial banks and savings institutions showed an aggregate profit of $914 million in the fourth quarter of 2009, a significant gain over the same period in 2008, but well below historical norms, the FDIC said.

“Consistent with a recovering economy, we saw signs of improvement in industry performance,” Bair said in a statement. “But as we have said before, recovery in the banking industry tends to lag behind the economy, as the industry works through its problem assets.”

Article by Politics Daily
Feb. 23rd, 2010

Inman News

Editor’s note: This is Part 1 of a two-part series.

Want to pick a fight in a roomful of real estate agents? Ask them whether they think open houses are worthwhile.

We did the virtual equivalent of that, sending out an online request for comments from real estate agents about the effectiveness of open houses — and they responded by filling up the old inbox faster than we could clean it out.

Their responses range from passionate conviction that open houses are “a must,” to cynical observations that they’re of benefit to no one other than to agents who are trolling for new clients.

So, in a departure from our typical “five things you should know” feature for consumers, we’re doing a two-part look at the topic here. This week: five reasons for homeowners to consider holding an open house. Coming up next week: five reasons to forgo it.

Sellers, why should you throw the doors open and invite the world? According to many agents …

1. Sometimes, they get the job done.

Many agents who responded to our wholly unscientific survey said they’re up-front with homeowners about the statistical unlikelihood of actually snaring a buyer who walks in off the street.

“My sellers realize that the likelihood of a sale as a result of the open house is quite small, but (they’re) ever-hopeful that they will be the exception to the rule,” said Pat Fales, associate broker at RE/MAX Allegiance in Burke, Va.

Melissa Hayes, an agent with RE/MAX Carriage House in Hermitage, Tenn., was one of a number of agents who shared their success stories.

“I have sold numerous properties by open house through one of two ways: Either the buyers return to their real estate agent and request a one-on-one appointment,” Hayes said. “Or the buyer will submit an offer the day of the open house immediately after viewing the property.”

Other agents said open houses can have a coattails effect.

“Many sellers say the only people who go through open houses are neighbors,” said Jim Rhye, an agent with Kentwood City Properties in Denver. “I don’t think that’s necessarily a bad thing. People, especially neighbors, talk. The more people that come through the house, the better.”

2. Sometimes, home sellers just feel better for holding an “open,” numerous agents said. Especially in a slow market, it amounts to a tangible effort.

“The seller thinks they work, so doing them despite how you may feel makes your client happy,” said Bill Donovan, of South Suburban Homes in Centennial, Colo.

“I wouldn’t say we love (open houses),” said Wendy Hooper, an Altera Real Estate agent in Aliso Viejo, Calif. “But we do appreciate that they can have their place in the market — particularly in communities with older, more traditional residents. This is an ‘old school’ approach that they expect and can relate to.”

3. Even if an open house doesn’t produce a sale, it might provide valuable information for the sellers.

“Feedback can be a valuable resource when discussing strategy with your seller,” said JoAnne DeBlis, an agent with Altera Real Estate in Monarch Beach, Calif. She said she prepares pre-addressed and stamped survey cards for prospective buyers so that they can comment on the condition of the house, price, etc. She uses their information to prepare a synopsis of every open house, she said.

4. The idea is not just to engage consumers, but other real estate agents, too.

Numerous agents cited the benefit of attracting consumers who stop by opens with their agents in tow, as those agents might see the house as attractive to their other clients and arrange showings.

And not all open houses are for the general public, the agents said.

“Owners should be briefed on the benefit of ‘broker opens,’ which are industry-specific open houses scheduled on regular ‘tour days’ in each area and advertised to brokers/agents,” said Hooper. “Statistically, it is highly probable that another agent will sell the home, so getting as many of them inside as soon as possible is prudent.”

5. So, what works best to create a successful open house?

Responses ranged from merely sticking the “open house” sign into the lawn to holding a pig roast, with plenty in-between.

“I make a point of knocking on doors of the neighborhood, either that day or the day before, inviting neighbors or to alert them to the possibility that maybe one of their friends or relatives might be interested in the home,” said Betty Ladas, an agent with Crye-Leike Realtors in Hendersonville, Tenn. “It’s like a politician knocking on doors, asking for votes.”

Other promotional “musts” cited by agents: directional signs on major streets to attract drivers; Web site, newspaper, social media and MLS announcements of the open; e-mail blasts; and postcards to neighbors.

Then there’s the food issue. Geena Becker, who says she isn’t particularly fond of opens, says nonetheless she likes to invite just a targeted list to the events at some properties.

“With my exceptional properties I will just have an open house with wine and cheese just for the neighbors,” said Becker, an agent with William Raveis Real Estate in Avon, Conn. She says the narrow invitation list helps keep her focused on the mission.

“I find that neighbors want to talk and talk, and having the public combined with neighbors makes open houses quite stressful,” she said. “Neighbors want to talk the neighborhood. Buyers want to ask specific questions on the property. I don’t want to hurry either conversation.”

Some agents recommended the tried-and-true smell of baking cookies or even pies to mellow out the attendees. Many said some kind of treat should be offered because it breaks the ice and encourages them to stay longer — and people just like free food.

Overall, the state of the market is good! As sellers and brokers it does feel slow in pace, but our experience has been a pace that is “slow and steady”.  Meaning, we have seen a consistency in movement of homes, but at a pace where the buyer is definitely driving in this market.

While there is a strong seasonal trend of fewer homes listed in the winter, the decreasing inventory seems to indicate that some sellers are finding other ways to deal with their inability to sell their property. Some are in long term rental arrangements and possibly others are just staying put and will try to weather the storm. And an unfortunate few are in some mode of foreclosure or will be soon if things don’t improve for them. This could be a question of their employment not providing as much income as in past years, plus the strong urge to save money just in case things change. You can find many a retail business that has seen sales decrease, as people are more careful with their money and expenditures. Saving money is the new thing, which was the old thing we forgot all about when we expected our homes would always grow in value. What would our grandparents say?

An AOL News Post.  By Ana Maria Sencovici

Dec 21st 2009

It’s understandable that many sellers are looking for agents to shave commissions at a time of economic distress. What few people understand, however, is that saving a few dollars on the commission may actually hurt you in the long run. The clichés of “you get what you pay for” and “there’s no such thing as a free lunch” never rang more true. (Note: Foxtons tried the model of 2% commissions and they’re out of business.)

Here are the five reasons why you may want to rethink your negotiations.

1. Times have changed: Counter-intuitively, downturns are the worst times to cut commissions. It’s actually times like these in which you get the best bang for your buck for every cent of the commission. Why? During the boom years, houses basically sold themselves. Therefore, the difference between a good selling agent and a bad one became murky because everything was selling so quickly. Now, properties are on market for 2-4 times longer, meaning that the quality and skill of the broker actually matters, and then some.

2. What’s required in this market: Excess inventory means that every little effort and differentiating factor counts. Particularly during turbulent times, much more work is required to get the same results. This translates into agents who: a) Pitch in extra advertising dollars for creative ways of marketing your property via alternative venues;

c)Make the most of every Sunday and some weekday evenings to host open houses.

3. The buyer’s broker payout: More than 85 percent of transactions (at least in NYC) involve co-brokers where the buyer has engaged a buyer’s broker for representation. In a buyer’s market, the inventory is so great that brokers are unlikely to be able to show their clients every single property that’s on the market. A good financial incentive (or split) for the buyer’s broker can make the difference between your property being shown and recommended … or not. So if we look at a traditional 6 percent fee, 3 percent goes to the seller’s broker and 3 percent to the buyer’s broker. If you get down to 5.5 percent, a good seller’s broker will keep 2.5 percent and offer 3 percent to the buyer’s broker, precisely to maintain that incentive even if making less than the counterpart.

4. No additional wiggle room: Many deals get down to the wire nowadays. In this tough market, the difference between the deal happening or not may be $10k. Often, at this point, good brokers on both sides will be willing to compromise on their fee, in the interest of their clients, to make the deal happen. If the fee is discounted at the beginning of the process, there’s much less room for negotiation at the end, when it can actually make a real difference.

5. What you pay for: Sometimes looking at the actual numbers can dispel the myths that brokers are somehow ripping sellers off. Let’s look at a $700k home, where the broker’s commission is 6 percent, or $42,000. This commission is split in two (between the buyer’s and seller’s broker), making it $21,000 each. Assuming the standard 50/50 split between the broker (the firm) and the agent (employee), the buyer and seller agents each receive $10,500. (Oh, and let’s remember that this is payment stretched over the time on market for the property, now an average of 6 months in Manhattan; that’s $1750/month.) So, assuming a conservative 2 hours per day, 6 days per week, we’re now at $36/hour, for a job that includes:

• · Developing and discussing an appropriate marketing strategy
• · Organizing photo shoots, 360 virtual tours, and videos for the property
• · Continuously and professionally advertising the property on public sites (newspapers, local listing services, etc.) and broker-to-broker databases, along with email blasts to agents and clients
• · Gathering appropriate documentation and answers from the management company to understand every aspect of the building and its policies
• · Consistently and promptly answering all questions about the property to brokers and buyers via email, work phone, cell phone (at all hours)
• · Scheduling and hosting open houses and one-off showings
• · Reviewing the offers and financial suitability of buyers
• · Consulting with seller on all offers and negotiating them in the best interest of the seller, making sure to help the seller be as objective as possible throughout (read why studies have shown it’s always better for a third party to negotiate on your behalf)
• · Preparing deal sheets, document compilations and board applications for dissemination to all parties in a timely manner
• · Overseeing the compilation and submission of the board package and all of its components, cross referencing all content
• · Being the continuous point-person (sometimes therapist) between all interested parties
• · Odds and ends such as coordinating move-in scheduling, forwarding addresses, special requests, etc.
• · Attending and facilitating the closing

All of this for $10,500 or $36/hr on a pre-tax basis. The above is not intended to generate pity or a “poor agent; nice try” reaction. Rather, it’s from a sense of pride and an attempt to provide a glimpse at the services a great agent provides in return for that commission.

So … ask yourself, what kind of agent is willing to provide a significant discount to their fee considering the above? In answering this, think about what you do for a living and why you would or wouldn’t reduce your salary or fee. Further, two additional points:

a) What does it say about the agent’s own negotiating capabilities with potential buyers if they can’t stand their ground with you?
b) What does it say about the value they place on their own skills and services, or their lack of existing business?
c) Which of the above duties or responsibilities are points of compromise for you?

One of the most talked about and most examined segments of business in Santa Fe is residential real estate. Maybe that’s why this newsletter has become widely distributed. We know the personality types that plug into the local real estate scene in their own special way. And we have usually welcomed that for diversity and for that flow of cash into our market. While that has not stopped, it has downsized dramatically. Second home buyers are still coming and growing families are still moving up in size and price. It’s just not as fast as we all want. The latest news is the recent extension of the first time homebuyer tax credit. Without the information available to be exact, it seems to have really helped sales of homes in Santa Fe the last few months. Great news!

So what is there to say today? Seems like the same message as always; now is the time to buy. Going back thru the full range of emotions we have experienced the last 3 years, we know we have accomplished something. Many others have faded away or simply moved to other pastures. We know the rules of financing have changed (are still changing) and that has kept some from purchasing, thus affecting some who hoped to sell. We now realize our homes should not have been like ATMs and we now understand the value of a home does not always go up. We might feel complicit in the economic difficulties of recent years; then still wonder why we are being punished for the sins of others. We know there is a limited ”best” time to buy, yet we have been talking for months about now being that time. And the good news is that the best time to buy will continue for a few more months. After that, you will have waited too long. Price increases are likely to begin just months into the new year. Wait at the risk of paying more next summer.

The updated monthly absorption rate chart is attached and this time, it shows improvement in most categories. We know some of that can be seasonal, but inventory is down while sales are mostly steady; therefore the # of months has come down that it would take, at current levels of sales, to absorb all inventory. In addition to the attachment, the chart below has a monthly running count of sales of improved residential property in Santa Fe City and County. The best news is an improvement from this month this year over same month last year. Just as good is that October 2009 shows the single largest monthly total so far this year. So there you have it. All your hard work may be starting to pay off. Maybe this winter will not be a predictable off season as buyers realize bargains are there and grab what they want now, while it’s available, instead of next June, when it may be gone.

Once again, if anyone has other statistical studies they would like to see, please let me know. And you may also use my email to unsubscribe if you wish, by sending me that message at alanball2@gmail.com

Sincerely,

Alan Ball

PO Box 4403

Santa Fe, NM 87502

By Michael Hartranft
Journal Staff Writer

New Mexico Business Weekly – by Megan Kamerick NMBW Staff

That’s according to Bernard M. Markstein III, vice president of forecasting and analysis for the National Association of Home Builders. He spoke at the monthly meeting of NAIOP Commercial Real Estate Development Association.

He was joined by John Covert, director of Colorado-New Mexico Metrostudy. Both predicted a long slow recovery for the residential construction, nationally and in New Mexico.

Most economists believe the recession officially ended in July or August, Markstein said, but the NAHB has extended it through the end of the year. However, one bright spot is that inflation does not appear to be a threat now or in the near future. He said the NAHB economists believe the Federal Reserve eventually will act to balance the liquidity the stimulus funding has put into the economy so that it will not contribute to inflation when it’s no longer needed.

Markstein said the best level annually for long-term health in housing starts is 1.8 million nationwide. For 2009, that will probably be around 600,000 and next year, most likely will be 700,000 starts.

“At this point, we’re probably underproducing, due to weak demand,” he said.

Despite mortgage rates being at historic lows and falling housing prices, the higher lending standards now in place have been a drag on the homebuying market, he added, while admitting that in the boom, some banks’ lending standards were worse than “a drunken sailors’.” But now it’s tough to get a loan without stellar credit, he said.

The current inventory of new homes nationally is about 300,000, down from the peak of 572,000 several years ago.

“In normal times, I’d say that’s too low, but we’re not in normal times,” he said.

There has been an uptick in sales that Markstein said is most likely due to the first-time homebuyer tax credit, but NAHB predicts sales will flatten once that expires in November. The organization predicts it will be extended, and has been lobbying for that in Washington, D.C., but that expectation is not figured into its current predictions.

The NAHB calculates that there have been 200,000 additional home sales nationwide because of the credit. About 40,000 of those were existing homes. However, tax officials told Congress last week that at least 19,000 filers who hadn’t bought homes claimed $139 million in tax credits and were reimbursed, according to the Wall Street Journal.

Employment is still falling around the country, as well as in New Mexico, Markstein said, despite other signs that the economy is recovering. Employment levels will most likely not return to pre-meltdown levels for at least another year, he said.

However, he said the population in Albuquerque has continued to grow at about 1.5 percent, which is good for the housing market. Covert said there is pressure on that trend, however, as people trying to move from other markets with higher home inventories are stuck trying to sell their houses in those markets.

“That’s why in-migration has almost come to a halt,” he said.

The local housing market still needs to go through some adjustment and there will be downward pressure on housing prices here, Markstein said. From June 2003 to June 2009, housing prices rose by 39.2 percent in Albuquerque and 40.9 percent in New Mexico, while they were up just 24.5 percent nationally.

That said, Albuquerque is still good on affordability, with a 73.8 score on the housing opportunity index, which measures affordability. The U.S. is at 72.3. Santa Fe is at 54.3, indicating how much more expensive that market is.

Covert said he thinks the housing market here has reached bottom. He focused more on the local market in his address. The excess supply in the Albuquerque market is slowly getting better, he said. But new homes are making up a smaller percentage of sales than they did at the peak in 2005 when they represented 30 percent of home sales. Now they represent 15 percent, Covert said.

Quarterly home starts peaked at 8,100 in 2005. In the third quarter of 2009, there were 1,300, although Covert expects that will rise to about 1,500 by the fourth quarter.

“That’s a huge drop-off in housing starts,” he said.

There also has been a dramatic shift in pricing over the past five years. About five years ago, 75 percent of new homes were below the base price of $200,000. At the peak of the market, only 25 to 30 percent of new homes were in that range. Albuquerque needs to “repair the buyer pool,” Covert said. Now, about half of all new homes are priced at $200,000 or under, so the city is starting to balance that supply a bit better, he added.

There are much higher levels of supply for homes that are finished, but standing vacant, in the $400,000 or higher price range, he said.

Covert did promise there are brighter days ahead for the state, and Markstein said New Mexico is one of the states the NAHB calculates will get back to normal more quickly after the recession.

Both presentations will be posted on the NAIOP Web site.