The news last week from the Obama Administration on new initiatives to help troubled homeowners definitely left the real estate industry whirling over what would come next. The good news is that the federal government will not need any more money as it hasn’t come close to using all of the TARP money set aside. The remaining money will help revamp efforts to help the hardest hit states, help refinance government-backed loans, and create incentive payments for banks and investors, among other things. All this is welcoming news, especially for those who owe more than their homes are worth.
This week marked the end of something many have feared for months: the withdrawal of the Federal Reserve’s program to buy mortgage-backed securities, an initiative which has been dubbed “the single most important move to stabilize the economy and to prevent a debacle” (talk about pressure!) Over the past few weeks, however, many of the fears have subsided as market watchers think the exit will have little effect. It will be interesting to see how speculation plays out and how the market will react in the coming weeks. Predictions?
The very beginnings of the expected April surge of activity is upon us, as new reports indicate that pending home contracts are picking up in some areas. Also good news, the Standard & Poor’s Case-Shiller Index, released this week, found that home prices increased slightly in January. According to an economist with Wells Fargo Securities, this “indicates that the worst of the declines are behind us.” We sure hope you are right, especially because others think that a new wave of foreclosures is likely to yield a lackluster market. This, however, is leading to healthy competition among house flippers. According to one experienced flipper, bums are now outnumbered on the courthouse steps, where many foreclosure auctions take place. It makes me wonder if these new house flippers will stay active in the market once it rebounds. What do you see happening in your area?
Although prices might still be dropping, many insiders argue that now really is the time to buy, as low mortgage rates may be a thing of the past. With all of the home price fluctuation, something to keep in mind is that property taxes are a good reality check when gauging a home’s true value – they are consistent.
With all the uncertainty in the marketplace, homebuyers, especially those nearing or in retirement, struggle with the decision to rent or buy. Although it may be right for some, renting trades long-term equity for lower monthly payments. For those of you in retirement states, what trend are you seeing?
One of the most interesting stories this week, in my opinion, discussed how to maximize the happiness in your home. Some of the best tricks include make the most of full-spectrum light during the day, matching wall color and ceiling height to a room’s purpose, and placing the main seating in the “power position.” One group of Americans who is looking to use these tricks and others to maximize their happiness and make the most of recent frugalism is the Generation Y consumer. This demographic group is increasingly learning life skills such as gardening, knitting, cooking and cleaning. It’s great to see these traditional skills come alive again!
A few interesting studies were released this week. The first shows that 75 percent of consumers think that corporate social responsibility is important. We should all keep this in mind as we consider philanthropic efforts in our communities. Never underestimate the value of good publicity! The second found that eighty-seven percent of Americans have mobile phones, according to a recent study. Wow! And the majority of people with phones (about 58 percent) are using them regularly. This tells me that if you are not doing any mobile communication, you need to!
In social media news this week, Facebook is doing away with the option to “become a fan” of pages. Instead, consumers can now “like” a page, which many believe comes more naturally. Something to keep in mind as you build your presence digitally.
Now, it is time for a lesson from outside the industry. At the front of the class this week: the publishing business. Magazines that have done well over the past few years are the ones that are involved in things beyond the glossy pages, employing such strategies as mobile apps, conferences and even TV shows. The lesson for us? The publishing industry had to change dramatically to meet the demand of a changing consumer. The real estate industry is not unlike this, as we move into the post-recession era and cater to a new home buyer. For instance, a story this week discussed how geo-fencing could become a major part of our industry. Who would have thought even a year ago that this was possible? Hey, even the autos are going digital! How can we “take a page” from the publishing industry (pun intended) and collaborate to evolve?
Lastly, as if the news that the iPad coming out this weekend was not enough, The Wall Street Journal confirmed this week that the company’s 4th-generation iPhone will debut this summer, along with a new phone for Verizon. Expect more on Apple news next week…