Category — Helpful Tips

CALIFORNIA.gov has home energy savings tips at Flex Your Power to save the planet, and your pocket book.  Personally, I like saving money, and then saving the planet.  Somehow, I think the two are related.

SPIKE IN GAS PRICES OVER $5 will have an impact on real estate prices.

Why is crude oil price spiking?  Fox Business New is reporting crude prices have climbed $8 a barrel to $137 in the last half hour.  No one in the G-7 or media seems to know why.

Here are several possibilities: most of them relate to Iran.

1. Iran is hording oil by filling crude tankers and anchoring them in the Persian Gulf.  There is now over 21 million barrels floating in the Gulf.  Iran is driving the price up.

2. There is a possibility of air strikes against Iran by Israel (with US approval).  Iranian oil would then be off the market.

3. The radicals within OPEC, including Iran and Venezuela, are deliberately limiting production and buying futures to drive up the price.

4. Foreign hedge fund and oil speculators driving up the price based on future anticipated demand.

All of the above.

Whatever the reason why, should gas prices climb to over $5 per gallon there will be major effects on the economy, food prices, transportation prices, durable goods, everything would cost more, and real estate prices would generally decline.  There is also the possibility of world wide recession.

Now Americans should know the US economy for the first time in history is in the hands of foreign entities that both fund the national debt (50% is owned by foreigners) and what we need for the economy (oil and imports).

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WHO’D A THUNK IT?  As you have already read it on Realestateblocks.com, mortgage interest rates are about to rise due to inflation cause by the shrinking value of the dollar.  Fed Chairman Bernacke announced today that the Feds low interest rate cuts were at an end, and inflation caused by the drop in the international value of the dollar my lead to higher interest rates.

Here I am, Cassandra, again.

I just got out of a meeting with Chase Mortgage regarding mortgage loans.  Online Chase’s mortgage interest rates are not available.  Wells Fargo was also nervous about mortgages rates.  Thirty year rates move before short term rates and it is likely borrowers will not see 5.85% fixed rate again for many years.  Any rate under 8.0% fixed is a good rate.  Traditionally mortgage rates run at least 3% over the rate of inflation.  Right now, it looks like fixed rates should be close to 10%.  ARMs and interest only are last year’s idea.

The primary cost of a home is the amount of the monthly payment.  Smart buyers and sellers will make their move now, and complete purchases and sales before November.

Borrowers will not be able to get low fixed rates again for love nor money in a few short months.

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I HATE TO SAY THIS, BUT on January 28 this year The Oracle spoke, predicting a new real estate market upturn and substantially increased sales beginning… yes, specifically on April 28, 2008. Did it happen? Yes, right on time. Bay Area sales are up 27%.

Boy, can I gloat, but then again… Cassandra is my middle name. I can predict the future accurately, but no one listens!

The Oracle Speaks again: Bay Area sales will go up month by month until in August the market will be HOT through November 2008.

BUT by April 2008 mortgage interest rates for fixed rate will be 8.5%-12%, and the market will plummet, again. And rates will stay high.

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PHOTOS OR THE LACK THEREOF ARE IMPORTANT home listing data as this post at 3 Oceans by Cindy Lin in this great post. Read the whole thing.

What I’ve noticed on Craigslist homes for sale listings is that many agents simply place an ad on Craigslist as an afterthought, and don’t take the time to import one or more photos.

Buyers use home photos to eliminate homes from their tour list. This was the point of Cindy’s post. The lack of photos puts the buyer and buyer’s agent in the position of needing to tour a home to eliminate it as a possible buy. Experienced agents understand.

I’ve noticed that experienced agents deliberately leave photos out of listing information. Where the home has some major defect, like front elevation, interior, or other major defect experienced agents leave photos out of listing information to pull in the best buyer’s brokers who know that they must see every listing that might fit their buyer clients needs, and so must tour the home without photos. I’ve toured hundreds of homes on behalf of buyers precisely because there were no photos. Diligent agents do tour these homes just to make sure the home does not meet their buyer’s criteria.

The lack of photos tells a buyer out shopping that either the listing agent is lazy, or more likely there is a major defect or defects with the home.

Sellers should also be aware that buyers and buyers agents particularly use photos negatively to eliminate home from their tour list. Photos should show the homes features, not just a beautiful photo so buyers will tour the home.

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