Archive for March, 2008

Brandon Green Companie just sent out our quarterly newsletter — our first e-newsletter. In addition to talking about this redesigned website, the e-newsletter explains our new satisfaction guarantee, congratulates Veronica Seva on her designation as an elite international real estate agents, and introduces our newest team member, Ken Rub.

If you’d like to receive the newsletter by e-mail, please send your e-mail address to amber@brandongreen.com.

Elaborating on my response to an article in The New Yorker on the downside of home ownership, here’s an interesting letter the magazine published in this week’s issue:

James Surowiecki’s interesting piece on home buying reveals another reason to consider economics as “the dismal science” (The Financial Page, March 10th). He notes that home ownership reduces mobility in the workforce, as, saddled with a house, neighbors, friends, family, schools, and other burdens of ownership, the homeowner hesitates to pick up and move at the first sign of a pink slip. Economists seem to view the ideal worker as an interchangeable part that can be moved and replaced at the whim of so-called market forces. Never mind that such a worker would be a perpetual migrant, never to know the pleasures of roots, community, and belonging. In past decades, it was customary to lambaste Communism as an ideology blinded by economic determinism with no room for “spiritual” factors. Can we not make the same critique of the free-market fundamentalists whose voices dominate today’s debate?

Pastor John S. Kerr
King of Prussia, Pa.

I completely agree with Pastor Kerr: there’s more to homeownership than just economics.

We’ve recently added our profiles to LinkedIn, a business-oriented social networking website. So if you have a profile on LinkedIn, please add us to your professional network. Here are links to our profiles:

• Brandon Green
• Veronica Seva
• Troy Patterson
• Ken Rub
• Amber Green
• Christian Salinas

And if you’re not a LinkedIn user, you might want to consider joining; it’s a great way to stay in touch with your professional contacts, discover business opportunities, and solicit expert advice.

Rottenneighbor.com might help you vent! Most of the comments are about bad neighbors, but a few are nice.

Bad neighbors are problematic and can make your life difficult. How can you possibly know if your new neighbor is going to be a serious source of stress? You probably can’t.

But if you buy with Brandon Green Companies and you end up hating your neighbor, we will sell your property for you and not charge you our commission. That’s how committed we are to what we do. We put skin in the game and hopefully give you a little insurance policy to cover rotten neighbors!

As this news broadcast explains, the Corvallis family featured on ABC’s hit show Extreme Makeover Home Edition faces foreclosure. Property taxes on the newly valued home and skyrocketing utility bills have sent this family over the edge.

Though the idea behind the show is fantastic, I always wondered how families on the edge could handle the increase in costs associated with a much larger home. It seems for one family, they cannot.

What’s the lesson here? When you buy a home remember to budget for the other expenses associated with homeownership, including property taxes, condo fees, insurance, utility costs, and maintenance. Work with your Realtor and lender to establish a realistic budget and you’ll be fine.

I can’t tell you how many calls I get from exited buyers when Ben Bernanke and his crew cut the Fed Rate. Fed Rates tie to home equity lines of credit, credit cards, and car loans and do not directly impact mortgage rates.

Do you think the rate cuts have a physiological effect on the housing market?

Freakonomics, one of my favorite blogs, has an ongoing debate about whether real estate agents are worth the money. Here’s the blog’s latest post on the subject: Real Estate Agents, Revisited.

It is a reasonable question to ask are agents worth the money you have to pay? If you think about it, the buyer pays all commissions as he or she is the one bringing the money to the table – not the seller. The seller may pay through reduced equity, but the cash that allows the seller to pay anyone (including him or herself) comes from the buyer.

There should be no doubt in your mind that your agent is worth his or her fee. If you don’t think so – you likely don’t have the right agent. Fire him or her and find someone new! At Brandon Green Companies we guarantee you’ll be happy with the services we provide or you can cancel our agreement at any time.

Price is only questioned in absence of value. Are you getting what you are paying for?

Last weekend I received numerous calls about our listing our 811 Buchanan St NW. Normally I’d be happy about the attention, but the callers were inquiring about the home for rent.

Come to find out, my listing—and photos—had been fraudulently posted on Craigslist as being for rent! Upon inquiring, you were asked to send your personal information to a woman in Nigeria. The ad was quickly removed by Craigslist. But I wonder how many people sent their information to this woman?

Just a reminder to be careful when sharing your personal information.

The New Yorkers‘ financial writer, James Surowiecki, in “Home Economics” calls into question our nation’s obsession with homeownership. Though homeownership makes sense for most people in the DC Metro area, it does not make sense for everyone.

Surowiecki brings up several interesting points in his article, including a statement that our elongated economic slowdown would be shorter if we weren’t a nation of homeowners, but rather renters that could pick up and move more quickly and adjust to changing environments. He suggests our houses keep us chained to our communities and slow down the natural market correction process.

Indeed, you should evaluate the risks of owning a home – just as you would evaluate the risks of any investment that cost hundreds of thousands of dollars. Along with those risks, add to your spreadsheet the list of benefits. Sure you’ve heard of the standard list everyone tells you about including tax deductions, return on investment dollars over time, and equity built up by paying down the loan, but isn’t there a lot of value in some of the intangibles?

What about the pride you feel when you sign on that dotted line and know you’ve accomplished something most people in the world cannot do? Do you know how much Argentines would give to be able to buy property through bank resources at 6 percent intest? Some of them gave their lives in the economic crisis in that country in the late 1990s and early 2000s just to have that right. Can you image a line outside of Kenyon Square condos in Columbia Heights full of people ready to die to have the right to buy?

What about the memories you build for you and your family as a homeowner? I remember at age 12 my parents sold their home in Wyoming and we moved to Iowa while my Dad attended Iowa State University. We were renting that home and I remember, quite vividly, a difference in attitude toward the home and the neighborhood. We were just visitors.

Don’t rush into your decision to buy a home. Make sure it is the right decision for you. As Realtors we can have that dialog with you and help you come to the right decision – for you.

Have you been renting for many years and have the financial resources to buy – but haven’t? We’d love for you to share your perspective here.

Finally – something with teeth!

As part of the economic stimulus package passed into law this past month, Fannie Mae, Freddie Mac, and the FHA have increased their conforming loan limited to $729,750 in the DC Metro area starting April 1!

Though pricing has yet to come out, this change should make buying in the DC Metro area much more affordable. Talk to your individual lender about how this impacts your qualification. FHA loans have not been viable for years because the caps were too low and the loan to cumbersome. The FHA limit is permanent, but the Fannie Mae and Freddie mac limit expires at the end of 2008.

Do you think a change like this will make you more or less likely to buy this spring and summer? Feel free to post a comment on our blog.

The sales statistics clearly show a buyers market with transactional volume down. Do you wonder where these stats come from? Check out the sales figures from the Greater Capital Area Association of Realtors.