December, 2007
My family will be spending the day/night with friends at their beach house in Virginia Beach. We have rang in the new year with these particular friends for several years now and it is always a great time. We celebrate Philadelphia style.
So, I probably won’t be posting anything else today. See you in the new year. Please have a safe and happy New Years Eve and I pray for a prosperous, safe and happy new year for each of you.
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It is unquestionably true that many potential home buyers across the country are waiting to purchase a home. The conventional wisdom is that most buyers are trying to time the market, to buy at the absolute lowest price possible. That’s understandable, even if the strategy is a little questionable.
The only reason that strategy would be sound at this point in time, is if buyers perceive continued substantial drops in real estate prices. In some parts of the country, I do believe substantial drops are still to come. In markets that are not expected to drop substantially, buyers at this point should be negotiating tremendous deals and they are out there.
But I believe that a substantial percentage of potential buyers looking for homes in Fredericksburg are not buying for another reason. They themselves have homes to sell and have been unable to do so.
See, the Fredericksburg region is a very transient area. On a daily basis military and government workers are transferred into and out of our area. They are coming to places like Quantico Marine Base, Fort Belvoir, Fort A.P. Hill, Headquarters Marine Corps, the Pentagon and more. Those folks often are moving from an area even more devastated by the current real estate market than the Fredericksburg area. (Yes, there are places harder hit than us.)
I wonder… how many potential buyers out there are newcomers to Fredericksburg, but cannot buy a home until they sell their home somewhere else?
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I certainly have. In the last week I saw hundreds of these type of signs from Fredericksburg, Virginia to Columbus, Georgia. You’ve seen them too right? You know the signs that say things like…
- We buy homes for cash
- We buy homes, no matter the condition
- We buy ugly homes
- Sell your home fast for cash
- And the list goes on
You need to understand that these companies are targeting certain types of sellers. They are targeting primarily…
- preforeclosure properties
- people in danger of bankruptcy
- people who have been transferred and need to sell quickly
Their primary sales pitch, is that we have cash in the bank and you can avoid paying commission to a real estate agent.
Understand, that they are usually looking to pay no more than 80% of market value. Often even far less. In almost every case, the seller would come out far ahead, even after paying commission, if they sold their home via traditional methods.
Don’t believe it? Watch what happens when someone sells one of these homes. It is almost a guarantee that it will be back on the market within 30 days and will sell for a far higher price than they paid the original seller.
There is nothing wrong with what these companies are doing. It is investing in it’s purest form. It’s just not a good option for a typical home seller.
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I love tech gadgets. I always have. But I am rarely someone who jumps on the bandwagon of new gadgets as they are released. Windows 95 early releases cured me of that after numerous and costly problems. So, I read about the iPhone as it was heavily promoted, but had no plans of buying one.
My daughter had other plans. She politely, but relentlessly promoted the fact that she dearly wanted one. We looked at iPhones in the Apple Store in Tysons Corners, she forwarded me promotional emails from Apple.. and so on. Even her dentist helped her cause by showing me how much she could use it… he let her play with his iPhone the entire time she was in the dentist’s chair for her cleaning. Still I wasn’t sold.
But, for Christmas, she got her iPhone. All I can say is Wow. That is a serious gadget! I fell in love with it. Not only is it a great gadget, but could have serious business applications for someone who uses the Internet a lot when they are on the move. The one drawback for me is that it won’t open real estate lockboxes like my Treo 650 will. The battery life seems a bit short too. Solve those problems and I would probably have one. Till then, I will just play with my daughters 
Category : Blog
I have been doing a ton of research for projects I am expecting to work on in January. During this research I found a question and answer session with Donald Trump. The question was about when to buy and Donald Trump’s response was something like this…. (paraphrased) I don’t buy in hot markets, I buy in dead crap markets and negotiate the hell out of them.
Ladies and gentlemen, in the Fredericksburg area, now is the time to buy and negotiate the hell out of them.
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Last night my family visited what I would qualify as one of the very best, privately owned, display of Christmas lights. I know it is the very best privately owned display I have ever witnessed. We are visiting family in Georgia and drove down Bethlehem Church Road near Grantville, Georgia and the sign just welcomed us onto their private property.
Then, for the next 20 minutes we wound around the property… driving through, by and around display after display of lights and one resounding message… Jesus is the reason for the season. I will have a few photos to display here on the blog in the next couple of days.
But, my real reason for writing this post is to wish each and every one of you a MERRY CHRISTMAS.
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Statistics and experts seem to show that we MAY have hit the peak (or the bottom of the barrel) in the foreclosure market. From last November to this November, foreclosures were up 68%! Staggering numbers… but, from October to November of 2007, new foreclosures were down by 10%. That is a significant decrease.
It is an indication… ONLY an indication that the foreclosure market may have hit it’s peak. It makes sense because the market began it’s shift to correct itself in late 2005. That was two years ago. Many of the questionable loans stopped being written in late 2005 and many of them had two year adjustment periods.
So, it is possible that the foreclosures have peaked. If so, that possibly spells the bottom of the market. This could be true, because for the last several months foreclosures have been the driving force in lowering the sales prices in the Fredericksburg real estate market
If the bottom of the market is here, then if history repeats itself, we should hit a few months of stablization, then the sales should begin a gradual increase in 2008.
Food for thought.
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Opinions and experiences (good and bad) regarding homeowners associations (HOA) provide for ongoing discussions within the current world of real estate. It seems like at least a couple times a week I find myself engaged in discussions of the good and bad sides of living within the rules of an HOA.
I have posted information regarding HOAs a couple times on this blog… see Wow Wee Uncle Bill and HOAs – Are they hurting the quality of family life?
It seems that this issue is discussed in bigger circles than Fredericksburg. Take a lot at the Trump Blog.
What’s your opinion on HOAs?
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I just don’t get what some people think is funny, or things they think they should be proud of. I saw the bumper sticker below in traffic yesterday and couldn’t resist taking a photo. I literally laughed when I saw it, but not for the intended reason. I laughed that somebody actually thought they should be proud of this sticker.
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When it comes to terms of pricing, there are few relative hot spots in the nation. The price changes below reflect sales price comparisons from October 2006 to October 2007.
1. Honolulu, HI +18%
2. Salt Lake City, UT +12%
3. Austin, TX +9%
4. San Antonia, TX +8%
5. Raleigh, NC +5%
Category : Blog