Month: December 2010
Christmas eve 2010
It is Friday and Fridays are for fun and it is Christmas eve so I’ll just say have a wonderful holiday and if you are traveling this weekend take care.
Holiday Self Potrait
As a Realtor I am expected to have photos of myself all over my web site. This is the best I can do. I hope you can see me. Happy Holidays!
It is the economy stupid
Last week I read about how mortgage applications were down because
uncle sam taxes
interest rates went up. It was just a theory of course but I think home sales and mortgage applications are down because of the economy. Rates are still below 5% and lower than they were during the peak years of the housing boom when home prices were higher than they are now. I think high unemployment is having a far greater affect on the housing market than interest rates are.
How can it be that both home prices and interest rates have gone down and home sales have not gone up? Income taxes have gone down since the peak years of the housing boom. The combination of lower taxes, lower interest rates and lower home prices should make for the perfect storm and housing should be selling like crazy yet it isn’t.
People will spend money on housing when they have jobs even if interest rates sky rocket to say 6%.
Yet there is one more hurtle or perceived hurtle to the recovery of the housing market the proposed changes in the mortgage interest tax deduction which is part of a bigger national deficit reduction plan.
These are the current limits on the mortgage interest tax deduction:
Deductible for itemizers; Mortgage capped at $1 million for principal and second residences, plus an additional $100,000 for home equity
Here are the proposed new rules:
12% non-refundable tax credit available to all taxpayers; Mortgage capped at $500,000; No credit for interest from second residence and equity
The important question is would the proposed changes to the Mortgage interest tax deduction discourage home ownership? Would home sales plumet because of it? Is the average St. Paul home buyer going to be negatively impacted by this, or will people want to buy homes again when they have jobs?
Look Inside
My wife thinks it’s kind of creepy that I enjoy walking around neighborhoods with open eyes just after dusk when people are getting settled in for the evening but before they draw their blinds or curtains.
I promise that I’m not a weirdo voyeur or anything. I never linger; oftentimes, I’m jogging by or walking briskly to a specified destination.
I simply find it heart filling to see people interacting in their homes – preparing meals, laughing, flipping channels, doing chores. My views are limited to a second or two, and that’s really all that’s nececessary (and defensible in a court of law).
It’s a more personalized form of window shopping, and I do like doing that, too. I do it on Grand Avenue, in the Highland Village, on West Seventh and in the skyways. Not to mention everywhere else I go in the world.
I don’t peep at my neighbors and I don’t bring a binoculars with me on trips that involve staying in hotels. I have eyes, I use them, and I generally like what I see. People living comfortable lives in their unique homes, even in homes they don’t own.
While picking up Chinese food about a month ago, I caught a glimpse of about a dozen households in action at once in an apartment building next to the parking lot. All those self-contained stories separated by slivers of ceiling and wall.
I found the scene encouraging above all else. But you should probably be careful of the opinions of a creepy weirdo like me.
(If you like the writing, feel free to follow @gsax on Twitter.)
Happy Winter Solstice 2010
It is either the shortest day of the year or the longest night depending upon your perspective and the first day of Winter which from my perspective started a month ago. Sunrise is at 7:48 AM and sunset at 4:34 PM giving us 8 hours and 46 minutes of day light. The days start getting longer again on December 25th.
This Winter Solstice is special and rare because there will be a full lunar eclipse starting at 3:41 AM out time and lasting for three hours. You can watch it on your computer via NASA.
The confluence of the Winter Solstice, the full moon and the lunar eclipse, and a snow storm make today the perfect day to buy a home in St. Paul.
The graphic is from one of my favorite iPad apps Emerald Observatory. This beautiful app costs less than a buck.
After the 1st or next Spring
spring flowers
This is the time of year that callers want to see about putting their home on the market “after the first” or in the spring. The sellers who want to list right after the first are probably ready and if they are not they can still be ready for Spring if they hurry but time is running out.
The spring market seems like it is a long way off but it isn’t. Most years buyers who plan to buy in the spring or summer are already looking in February and some years we see the most offers on homes during the month of April. If selling in the spring is the goal now is the time to get started.
The first step is to clean the place up and declutter, The next step for St. Paul home sellers is to order the truth in housing report. It is a good idea to have things fixed up before the inspector arrives. Here is a list of items that are most often written up. Look at the list, fix what you can and then call for the inspection. You can make repairs after the inspection but only the inspector can change the report.
The city does not require that the deficiencies be corrected but the home will look better to buyers if the inspection report is clean.
Take care of other small repairs before putting your home on the market because it will pay off in the long run. Buyers will offer thousands less for a home that needs a couple hundred dollars worth of repairs.
Call your lender and find out how much you owe on your home. I know it is disappointing but how much you paid for it or how much you owe on it doesn’t matter to perspective buyers. If you owe more on it than you can sell it for consider staying put or renting it out. Asking for more than the home is worth just means it will be on the market for a couple of years. I see it all the time. If you must move start working on getting the money you will need to bring to the closing.
The goal should be to get your home on the market as soon as February 1st and no later than March 15th if the goal is to get the most exposure and sell it in the spring.
Last year a couple of people that wanted to list in the spring totally missed the target and by the time they were ready home sales had already started to slow down.