The Most Expensive Suburbs by City

Suburbia doesn't have to be boring, but it sure can be expensive. Here's where your richest neighbors sleep and play

Want to leave city life behind for a suburb with affordable housing, low taxes, and a cheaper cost of living? Don't look in these places.

Even with last year's home price declines, the most expensive town in your metropolitan area probably has a median house price in excess of $1 million, with a property tax rate well over $10, or even $20, per $1,000 of home value.

But if you have the means and the stomach for such elevated prices, you can, luckily, expect to get your money's worth in a costly suburb. The school systems are best-in-class, the crime rates are nil—and if suburbia's dull, conformist image has deterred you in the past, a wealthy community packed with mountain trails and luxurious beaches may finally win you over.

BusinessWeek.com asked Portland (Ore.) research company Sperling's Best Places to come up with a list of the most expensive suburbs in 20 of the nation's major metropolitan areas using home prices, cost of living, and property taxes as determinants. The results are varied—with median home prices ranging from $772,000 (Dellwood, Minn.) to $2.8 million (Hillsborough, Calif.)—but uniformly unaffordable to all but the richest American families.

Every suburb on our list has a cost-of-living index of at least 196.8 (Greenville, Del., and Dellwood, Minn.), with 100 being the national cost-of-living average. Hillsborough, in the famously expensive San Francisco area, has an index of 535.1, or five times the national average, while Old Westbury, N.Y., on Long Island, has an index of 498.1. Property tax rates run as high as $26.2 (Piney Point Village, Tex.) per $1,000 of home value.
Understated Elegance

Surprisingly, not all ultra-expensive suburbs feature gaudy estates and celebrity neighbors. Take Rolling Hills, Calif., an equestrian-oriented community of less than 2,000 residents just 30 minutes from downtown Los Angeles.

Rolling Hills is a gated, strictly residential community on the Palos Verdes Peninsula featuring white ranch homes with ocean and city views on spacious two-acre lots surrounded by three-rail white fences. There are no traffic lights, and there are more horse trails than roads. Residents work, shop, and go to school in surrounding towns.

"We call ourselves the only gated city in America," says Bill Ruth, a realtor with Keller Williams in the Palos Verdes area. "We've been playing off that one for a while."

The median home price in Rolling Hills is about $2 million, with sales last year ranging from $1.5 million to $3 million. Although the median household income in the community is $256,944, the highest on our list, there aren't many $10 million mansions here. No flashy Hollywood types, either: Most residents are business owners, doctors, or attorneys, and the wildest event you are bound to attend is a children's party or a Little League game.

"It's a unique community where you can still leave your front door unlocked," Ruth says. "There's zero crime. Though a horse was stolen last year."
Brandywine Bargain

Well-off folks who want to live large but still enjoy a good deal (and who doesn't?) may consider relocating to Philadelphia's priciest suburb, which happens to be in the inconspicuous state of Delaware, amid the open spaces and sprawling golf courses of Brandywine Country.

In fact, Greenville, Del., buoyed by Delaware-based chemical giant DuPont (DD), is also a commuter community for workers in Wilmington, Washington, and New York. Houses in Greenville range from DuPont family-owned colonial estates to 10,000-square-foot McMansions to houses commissioned by the Texas oilmen who came to the area when DuPont acquired oil and gas company Conoco in the early 1980s. Today the community's residents are of a mix of old and new money, with many lawyers, bankers, and businesspeople employed by the local industry.

"There are some trust-fund babies around, but the majority are working types," says Wendy Bunch, a local agent with Brandywine Fine Properties Sotheby's International Realty.

While $5 million homes are not at all uncommon in Greenville, the median price in the area is just $805,300. Property taxes run at a rate of $8.17 per $1,000 of home value, and the cost of living is less than twice the national average. And forget about sales tax—there isn't any in Delaware.

"It's a wonderful place to live, and it is still a bargain," Bunch says.

Want to know where the wealthiest suburbanites live in your metropolitan area? Click here for the list of the most expensive suburbs for the 20 biggest cities in the U.S.

Queens real estate broker charged in $1.6 million real estate investment scam

District Attorney Richard Brown announced Wednesday that a Bayside real estate broker has been charged with defrauding four real estate investors out of more than $1.5 million which she allegedly used to pay off personal and business loans.

The District Attorney identified the defendant as Shelly W. Cao, 40, of 45-63 218th Street in Bayside. She was arraigned yesterday before Queens Criminal Court Judge Ira Margulies on a criminal complaint charging her with first-, second- and third-degree grand larceny, first- and second-degree criminal possession of stolen property and first-degree scheme to defraud. Judge Margulies set bail at $1 million and ordered the defendant to return to court on February 6, 2007. If convicted, she faces up to fifteen years in prison.

District Attorney Brown said that, according to the criminal complaint, the defendant offered to purchase real estate in upstate New York for investors as part of an agreement to create a new joint company for the ongoing purchase of real estate for investment purposes. It is alleged that between February 12, 2005, and August 31, 2005, she accepted a total of $1,597,615 from four businessmen wishing to invest in the venture.

The District Attorney said that the complaint further alleges that the defendant deposited her victims’ funds into her personal and/or business accounts to pay off loans owed by her or her companies: Wei’s Realty Corp., #1 Funding Center, Inc., and Perfect Funding Corp, all located at 136-31 Roosevelt Avenue in Queens. The complaint further charges that the defendant never formed a new joint company nor did she make any purchases on behalf of the venture.

Real Estate Marketing Tips -- Using Testimonials

Genuine testimonials can add credibility to a real estate marketing program. When the testimonial comes from a known source, like a neighbor, that power increases tenfold. So how do you go about using testimonials?

An easy but effective formula:

1. Place a testimonial at the top of your piece, in headline fashion.

2. Followed up with your message, giving specifics of the transaction -- the number of interested buyers that came through, the time it took to get a contract. (Or other relevant data from a buyer agent transaction).

3. Then offer to help the reader in the same way.

4. End with your offer and call-to-action.

Create a testimonial "harvesting" system.

The easier your testimonial gathering system is, the more likely you'll do it on a regular basis. Put something down on paper. Map it out. Make it a point to solicit a testimonial from each client X-number of days after the transaction.

Follow your timeline consistently. And be sure you make it clear how you will use the testimonial (simply by using the phrase "in my marketing efforts").

Use your client's full name and address whenever possible. When you write a testimonial-request email or letter (or call them on the phone), ask if you can include their full name and address. Explain that it makes the testimonial more believable than something signed by "R. P. from Houston."

For example, if you lived at 344 Elm Street, Houston, TX, which of the following testimonials would capture more of your attention:

One signed by J. Riley, Houston, TX?

Or one signed by John and Beth Riley, 357 Elm Street, Houston, TX?

Send thank-you cards or a small gift to testimonial providers. This will boost your referral rate. Besides, it's just plain nice (and there's plenty of room for nice in today's business world).

Use the complete testimonial.

Open your newspaper up to the movies section and you'll see testimonials that look like this:

"...great..."

"...superb..."

"...astounding..."

Besides the fact that these snippets are worthless, what's the first thing they bring to mind? If you're like me, you might say they look like they've been taken out of context by a tricky writer. Use the full testimonial, or at least the full sections that are most applicable.

Summary

Testimonials carry more power than anything you might say about yourself. Create a simple harvesting system and follow it consistently. Be honest about your intentions. Send a thank-you card or small gift.

GarCo hits $1 billion in real-estate sales

With real-estate sales in Pitkin County surpassing $2.5 billion in 2006, Garfield County made a run for the money last year too, breaking the $1 billion mark for the first time.

According to a report by Land Title Guarantee Company, the dollar volume of real estate transactions in GarCo was $1.04 billion in 2006, a 21 percent increase from 2005, when $855 million worth of real estate transactions took place. A total of 2,852 units were sold, 9 percent more than the previous year.

December ended on a high note, with $104 million in sales, which was up 32 percent over 2005 in dollar volume but slightly less in the number of units. The largest part of that volume took place in Carbondale, which saw $836,000 in sales that month.

Dollar volume has increased rapidly in GarCo over the last few years. In 2003, there were $439 million in real estate sales, then $600 million in 2004 -- last year's transactions represented a nearly threefold increase in dollar volume.

Comparatively, Pitkin County had both a double-digit percentage increase in dollar volume (26 percent) and a double-digit percentage decrease in transaction volume in December, showing that prices continue to go up, according to Land Title.

Pitkin County's $2.64 billion in real-estate sales is an almost 18 percent increase over the previous year -- and 132 percent higher than in 2003.

Not surprisingly, Aspen had the lion's share of the dollar volume in December -- 57 percent, compared to 36 percent of the number of transactions.

Last year also saw only a 2 percent increase in dollar volume from fractional sales: $181 million as opposed to $178 million in 2005.

How To Name Your Real Estate Blog

This post is for agents thinking about starting a blog. The first item of blog business is choosing a name. We suggest you consider incorporating the keywords “Real Estate“, as well as your local market, eg: New York Real Estate Blog. Here’s one reason why. The coveted keywords “real estate” are normally not within reach on Google. But they are DEFINITELY within reach on Technorati, which is currently the #1 Indexer of Blogs.

I typed in a search for “real estate” in the “blog directory” and here were the results, sorted by authority. Of the 874 blogs about real estate, Sellsius° was number 2 and Rain City Guide was number 3. Neither of us have the ranking or traffic of Curbed, yet we both are at the top of page 1. Why? Because we use “real estate” in our blog title. Other familiar blogs on page 1 include: Pat Kitano’s Transparent Real Estate, Joel Burslem’s The Future of Real Estate Marketing and Real Estate Investing for Real by Bigger Pockets. Just something to think about.

Tiny London apartment on sale for $335K

LONDON - Location, location, location. Almost anywhere else, the tiny dilapidated studio wouldn't attract much more than mice. But this is London and the 77-square-foot former storage room — slightly bigger than a prison cell and without electricity — is going for $335,000.

The closet-sized space in the exclusive Knightsbridge neighborhood may be only "about the size of a ship's galley, said real estate agent Andrew Scott, who's handling the sale. "But it's permanently anchored to one of the wealthiest neighborhoods in the world."

At more than $4,340 a square foot, the mortgage buys a spot within walking distance of tony stores like Harrods and London's iconic Hyde Park. Originally conceived as a maid's room, the apartment at 18 Cadogan Place hasn't been used for years and is littered with trash bags and crumbling paint.

A coffin-sized shower is en suite, and storage is provided by a shallow closet and 10-inch-deep shelves cut into the wall. Two hot plates and a small sink make up the kitchen. Two dirty windows allow light to filter into the basement room, and the fire escape could conceivably double as a shared patio.

With no electricity or heating, Scott said it would cost an additional $59,000 to make the room habitable.

"It is an investment," he said, as he stretched his arms the width of the room, laying his palms flat on opposite sides of the wall.

The sale of this dark, mildewy room illustrates the astronomical rise in property values across London, which in the past year has seen average residential property prices increase 22.4 percent, to about $703,000, according to figures released Monday by Rightmove, which tracks the British property market.

Prices in London's most desirable neighborhoods have grown even faster, with average house prices in the borough of Kensington and Chelsea — where Cadogan Place is located — rising 61.8 percent over the past year to a jaw-dropping $2.2 million.

Ultra high-end property prices in London are the most expensive in the world, with some recent sales hitting $5,900 per square foot — making the Cadogan Place studio a bargain by comparison, according to research published last year by CB Richard Ellis Group Inc.

Similar properties in New York can go for about $5,300 per square foot, while those in Hong Kong sell at around $3,950 per square foot.

Scott said he already had three offers on the property, which might go to auction. Size, he added, is in the "eye of the beholder."

"If you thought of this as the cabin on a boat, you'd say, 'It's pretty spacious,' " Scott said.

Real estate scammers: We're onto you

So, two more Brit issues came in this week regarding real estate or visa-type problems that were complex and costly.

Note to the ill-doers: Everyone is onto you these days. I think there was a time maybe when people Americanflag_3 were naive and didn't know what was happening. People were trusting. But everybody from the U.S. Embassy to Homeland Security to little-ole-me knows how a lot of this works by now.

I cannot stress enough to those who are buying real estate to consult with established firms on good referrals and lawyers who work in immigration. During the real estate hey-day of the last few years in Central Florida, a lot of people jumped on the bandwagon to sell and it was easy. They sat in their office and the phone rang. Now, they're starving. What do people do when they starve? Some of them get desperate and willing to compromise whatever miniscule set of values they had.

The people who have been in real estate know the drill. The market goes up, it goes down, it goes up, it goes down. It's like farming. Farming families have the fortitude to make it through tough years, knowing full well they are coming and they are going. They don't lose their values on the lean years. So it is with good real estate people. Find those people when you are buying and selling. Find an immigration lawyer --- those are the ones who have a passion for immigration issues --- to work with you. Any old lawyer won't do.

And don't let a few bad stories ruin your hope of being in the U.S. if you want to be.

On The Market: HUDSON RIVER MULTIFAMILY

$1,595,000

WESTCHESTER: 1178 Warburton Avenue, Yonkers

A 114-year-old Victorian with five apartments: the largest has two bedrooms, one bath and three fireplaces; two have one bedroom and one bath; one has three bedrooms and a bath; and one is a studio. Jane McAfee, Houlihan Lawrence (914) 337-0400; www.houlihanlawrence.com.

TAXES: $22,100 a year

PROS: The largest apartment has oak floors and a renovated kitchen with trendy appliances. The house is perched high on a hill, affording grand views of the Hudson. The zoning for the 0.67-acre-lot allows for redevelopment to a condo complex.

CONS: The house is on a busy commercial street and requires a steep climb to the front door. And the Yonkers public school system has been troubled for decades.

After Sale, Rent Increases Give Some Sticker Shock

Dara Kane loves almost everything about Peter Cooper Village, from her spacious apartment and friendly neighbors at the complex overlooking the East River near 23rd Street to the park-like grounds and the elementary school her 7-year-old attends.

But Ms. Kane and her family are moving out.

She said her landlord notified her that the rent on her two-bedroom apartment was going up $700 a month, or 18.7 percent, to $4,450 from $3,750, beginning Feb. 28. That is on top of the $500 rent increase she got last year. It is just too much, she said.

Ms. Kane and dozens of other tenants paying market-rate rents are suffering from sticker shock in the first wave of lease renewal letters being sent out by Tishman Speyer Properties, which bought Peter Cooper Village and its sister complex, Stuyvesant Town, in October in a record-breaking $5.4 billion deal.

Some tenants among the nearly 25,000 residents in the two complexes report that their rents are going up as much as 33 percent, the latest sign that the two complexes, long regarded as an affordable haven in Manhattan for middle-class New Yorkers, are changing.

“It’s really a special place,” Ms. Kane said. “But they are not interested in retaining any stable tenancy. When people like us leave, you have to wonder, how are the public schools going to survive? How will the 14th Street Y sustain itself? All those things are going to suffer.”

Evan Horisk, a television producer for PR Newswire, a corporate news network, moved out of his two-bedroom apartment in Stuyvesant Town on Jan. 4, after the landlord notified him that his rent would jump 26 percent, to $3,350 from $2,660 a month.

“It flipped my life upside down,” Mr. Horisk said. “Living there was great. The renovations were superb. The maintenance was top-notch.” But, he added, “I didn’t get a big raise this year that can compensate for that kind of increase.”

While moving vans may be a more common site in front of the 110 buildings that make up Peter Cooper Village and Stuyvesant Town, a wholesale exodus is not under way. Indeed, Rob Speyer, a senior managing director at Tishman Speyer, said that roughly 80 percent of the tenants are renewing their leases, regardless of the increases.

He said the company is only raising rents to market levels from below-market rates. It was a process begun by the previous owner, the Metropolitan Life Insurance Company, over the past four years.

“We’re generating significant demand from existing residents as well as from the outside,” Mr. Speyer said. “Our rents are well within the market, and our renewal rates demonstrate that.”

According to Citi Habitats, a rental broker in Manhattan, the average rent in the neighborhood east of Gramercy Park, which adjoins Peter Cooper Village, was $2,785 for a one-bedroom apartment and $3,846 for a two-bedroom apartment. Those rents include buildings with doormen, an amenity that neither Peter Cooper Village nor Stuyvesant Town has.

Last year, rents rose an average of 10 percent in Manhattan, while the vacancy rate fell below 1 percent.

“Depending on the neighborhood, the increases were anywhere from 7 percent to 20 percent,” said Gordon Golub, senior managing director of Citi Habitats. “The neighborhoods below 23rd Street were the most affected, and that trend will continue in 2007.”

Still, it has been a shock for many residents of the two complexes, where nearly three-quarters of the 11,200 apartments have regulated rents at a third to half of the market rate. Traditionally, tenants moved in and stayed for years and even decades.

MetLife built the complexes in 1947 with state and city subsidies after it agreed to maintain below-market rents for 25 years. An apartment can be decontrolled, however, after it becomes vacant, or if the rent reaches $2,000 a month and the existing tenants’ household income rises above $175,000 for two consecutive years. About four years ago, MetLife began renovating vacant apartments, which allowed the company to take the units out of rent regulation.

Many of the rent-stabilized tenants feared that they would somehow be ousted from Stuyvesant Town or Peter Cooper Village by a new owner after MetLife announced last year that it was selling the complexes.

But their rents are protected by state law. It turns out, some residents say, that the market-rate tenants, who account for 27 percent of the apartments, are the ones who should have been concerned about the future.

“We’ve heard a lot of complaints about this,” said Alvin Doyle, president of the Stuyvesant Town-Peter Cooper Village Tenants Association.

One tenant at Peter Cooper said she had decided to renew her lease for a year, despite a 33 percent rent increase to $4,300 for her two-bedroom apartment. But she will be moving out in 2008.

“I don’t want to leave,” said the woman, who insisted on anonymity because she has not yet signed her lease. “But I can’t afford it. I’ve got a kid going to college in a year and a half.”

Mr. Doyle said he was also getting complaints from rent-stabilized tenants who had received letters from the landlord saying that their lease would not be renewed because the apartment was not their primary residence. Under state law, the landlord is permitted to evict a tenant who is using a rent-regulated apartment as a pied-à-tere or illegally subletting it.

Jack Lester, the longtime lawyer for the tenants association, said the landlord was trying to evict tenants who own any property outside the complex, including vacation homes or investment properties, in an attempt to “bludgeon people out of their homes.” MetLife did the same thing, he said, but the practice seems to be accelerating under Tishman Speyer. Mr. Lester said he now has 38 nonprimary-residence cases, up from an average of 18 a year.

Mr. Speyer said that legal tenants had nothing to worry about.

Home Buyers Guide to Understanding Home Styles and Names

Don't Know a Cape from a Colonial? This Guide is for You


Takeaways
Cape style houses have one and a half stories
Ranches have all living space on one level
A colonial means that all the bedrooms are upstairs
If you are thinking about buying a house, particularly if you are buying your first house, you may be a bit confused by house styles. Understandably so. There are many styles to choose from, so it is helpful to know what each one means.

Refer to this guide to help you understand which style of house is which. You'll be a whiz at knowing a Split from a Splanch or a Post modern from a Victorian.

Cape, or Cape Cod

A cape is defined as being a one and a half story house. However, this may have variations. A non-dormered cape will have a small upstairs with a very slanted triangular ceiling. This is the half story.

Sometimes capes are dormered, however, and will have more room in the upstairs bedrooms. Usually, the ceilings toward the front of the house will still be fairly slanted and may have alcove-type windows, called dog-house dormers. You will usually see a lot of roof from the outside.

A cape may typically have two bedrooms downstairs and one or two bedrooms upstairs.

Colonial

A colonial is the most popular style of house. The name colonial conjures up images of quaint early American homes. However, all that is really meant by the term colonial is that all of the bedrooms are upstairs. Very simple.

There are also center hall colonials. This means that the front door is in the center of the house, not towards either side. You will also find the stair case and hall way in the middle of the house. A side hall colonial will, therefore, have the front door to one side of the front of the house, with the stairs and hall also to one side.

Contemporary

These are usually pretty easy to identify. They have a very modern look with soaring ceilings and some angular construction. They may have many skylights. They tend to have open floor plans, with one room flowing into another without necessarily having walls between them. Many homes of this style were built in the 1980s.

Farm Ranch

A farm ranch is somewhat similar to a cape, but it is usually larger. It will have the same kind of sloped roof and ceiling upstairs the way a cape does. A farm ranch will usually have two or more likely three bedrooms downstairs. The downstairs will be larger than the upstairs, which can give it a feeling similar to a ranch. Often, the master bedroom is on the first floor and may or may not have its own bathroom.

There are usually two bedrooms upstairs with slanted ceilings. Farm ranches can also be dormered (have their upstairs ceilings raised and unslanted) for more space.

High Ranch or Raised Ranch

High ranches or raised ranches are usually easy to identify. You typically have to go up a few stairs to get to the front door. Then, you have to make a choice of whether to go up a few stairs or down a few stairs.

The main floor or upstairs of a high ranch will have most of the living space. Kitchen, living room, bathroom and bedrooms. This gives it a feeling similar to a ranch.

The downstairs of a high ranch is not completely underground the way a basement is. So it can have good sized windows. There may be a den area at the bottom of the stairs which can typically have doors to the backyard. There will usually be a door to a garage at this level as well. There is no additional basement.

Post Modern

A post modern style house is usually a term that we use for newer construction. It is usually a colonial (with bedrooms upstairs, remember?) and may have some cathedral ceilings and oversized windows.

Ranch

A ranch is not necessarily a house that you will find in the middle of cattle country. A ranch is a house with only one level besides a basement. The living space, bathrooms and bedrooms will all be on this level.

Ranches are advantageous to anyone who does not want to climb stairs very often as all the living space in on the same level. Sometimes, however, the garage will be underneath the house, requiring a hike up. Sometimes, though, it will be at ground level.

Split Level or Split

A split level house, or split, will have many half stair cases. You never go up or down an entire level at once as each level is offset halfway from the other.

Typically, on the main level of a split, you will find the living room, dining room and kitchen. One disadvantage of this style is that there is no bathroom on the main level.

If you go half a flight up from the main level, you will get to the bedrooms and main bath. The master bedroom may or may not have its own bathroom. It could also be another half flight up from here.

If you go a half flight down from the main level, you will usually be in a den which is mostly above ground. There may also be a bath and a bedroom. You can sometimes access the garage and backyard from here.

Down again a half flight from the den level is the true basement. These are usually partial basements.

Splanch

A splanch is somewhat similar to a split. On the main entry level of the house, you will find the living room, dining room, kitchen, bath or powder room and sometimes a den. If you go upstairs half a level you will come to a floating living room. This means that it is all by itself on this level. The living room may be somewhat open to the kitchen or the den.

Up another half flight from the living room are the bedrooms and at least one full bath. Again the master bedroom may or may not have its own bath. Splanches are usually fairly large. They have partial basements.

Tudor

Tudors are usually quite charming and distinct. They are usually colonials with stucco exterior walls with beautiful woodwork. They may have small windows. You will usually find Tudors with lots of woodwork inside and the windows may have leaded or divided glass panes.

Victorian

Victorians are usually colonials. They are not necessarily old, however. They usually have front porches or turrets. There may be gingerbread style siding on the outside. These additional architectural features conjure the charm that is associated with a Victorian.

House Hunting

Now that you have your glossary of house styles, you may want to print it out and take it with you while you are looking for houses. This way, when your Realtor says she is going to show you a Post Modern Victorian, Side Hall Colonial or a Dormered Cape, you will know exactly what she means.

Documents You Will Need when Selling Your House

Make Sure to Locate These Documents so the Sale or Your House Can Close Smoothly


Takeaways
Have utility hills handy in case the buyer asks about htese costs
Certificates of Occupancy or builiding permits may be obtained from your local Town Hall
Make sure to know what the true property taxes are without exemptions
You have decided to sell your house. That is am important decision. It can be a stressful time; you'll have to have strangers walking through your house, you'll have to negotiate the price, you'll have to pack up all of your belongings and move. So, why not take some time before you've got an offer and locate all the documents you'll need to complete the sale.

In addition, you may find that you can not locate something you were sure you had. If you get all of your documents together ahead of time, you will have plenty of time to replace anything that you can't find. You may also discover that you need permits from your local town hall. Getting these can be time consuming. If you begin the process now, you won't have to hold up your sale or make any last minute negotiations.

1.Deed or deeds to the property

a. Property description

b. Exact boundaries and size of the plot or acreage

c. Tax map number of section, block and lot

d. Restrictions and easements (others' right to property including mineral, water and drilling) legally binding all future owners

e. Description of any property sold from original purchase

2. Surveys, survey maps, tax maps. Often, the buyer's bank will want a new survey of the property. This is the usually responsibility of the buyer to order and pay for. However, while your house is for sale, prospective buyers may want to get an accurate idea of property boundaries, so if you have a survey or tax map be sure to find it.

3. Title insurance policy or title search information. You will need a copy of your title insurance certificate or policy. This states that you own the house and that no one else except your mortgagor makes claim to the property. You will need this documentation.

4. Property taxes (any reduction due to veteran's or other exemption?). If you have any property tax exemptions, be sure to let the buyer know before contracts are signed for the sale or your house. For example, the buyer many not be entitled to your Veteran's exemption. A buyer can claim misrepresentation if the true property tax amount is not disclosed.

5. Mortgage information (including first and second mortgages, any liens, judgments or equity loans on the property). You will also need to get a pay off amount from your mortgagor shortly before the closing. The buyer or his attorney will need to make out a check to your bank for this amount.

6. Insurance. Make sure that you have all insurance certificates on file and that they are current.

7. Engineering or contractor inspection report. Your buyer will almost certainly want to have his or her own building inspection of your house. However, if you have had a recent engineering or contractor inspection report, you many want to have it accessible to prospective buyers.

8. Guarantee and warranties. The buyer will appreciate having any warranties or instruction manuals for the appliances, etc. Also, you may have guarantees for items like a roof or central air conditioning unit. Be sure to turn these over to the buyer at the closing. Having them handy may even be a selling point to a buyer.

9. Contracts and leases. If you have a tenant, be sure to have a copy of his or her lease on hand, as well as any other contracts you any have involving your house.

10. Utility bills. Prospective buyers will often want to know what the costs are of running your house. Of course, prices will vary from year to year and so will their usage. But it is a good idea to have these bills handy as a guideline.

11. Termite inspection or guarantee. In most areas, the seller is responsible for delivering a house free and clear of any wood eating insects or from damage due to those insects. A bank generally will not finance a house that has live termites or carpenter ants. The buyer will often have an inspection done to determine if any of these insects are present. If a treatment is determined to be necessary, be sure to get a treatment and a one year guarantee. Bring the guarantee to the closing.

12. CO's (certificates of occupancy) by your local town for additions or changes to existing structure and/or property as well as for original structure. It is a great idea to make sure that these are all in order when or before you list your house for sale. If you have made any changes to the structure of the house, if you have added or enlarged windows or if you have finished previously unfinished space, you will need a Certificate of Occupancy from your local town hall.

Don't wait until the last minute for these. No one wants to get to the closing table, only to find out that the sale is held up because you are missing a permit. Your local Realtor may be able to help you determine if you need any additional permits or Certificates of Occupancy.

Smooth Sailing

Now that you have all of your documents ready, you can proceed with the sale or your house. You will not have to make any concessions because you have something missing at the last minute. If you have all of your paperwork handy and current, you will find that the process of selling your house will go more smoothly. Be sure to check with your local Realtor or attorney as customary paperwork may vary from region to region.

Add Value To Your Home

A badly designed kitchen shall affect your peace of mind and make any time spent in the kitchen an unpleasant experience. You could further enhance your kitchen by simply changing the colors on the wall; if this does not satisfy you then you can move on to making bigger changes. A kitchen must look charming and cook beautifully too; one without the other may not get you very far. A granite countertop can be very beautiful, but also very resistant to scratches at the same time; it can come in one long slab or in tiles.

A badly designed addition to your very home can kill your resale value, so be sure to do a great job on any remodeling job. When you find a contractor you should be prepared to come with some ideas for them to take a look at and a budget for them to follow. A kitchen island is a centrally located countertop which gives you more space to actually prepare or serve your very food. Your main objectives during your kitchen remodeling project is to make your kitchen look like as though you spent a ton of money even though you did not.

A professional kitchen remodeler might be the ultimate help in your home improvement project, but not everyone may afford that. You will see that everything regarding kitchen remodeling can be found at your local home improvement store, therefore do not panic when it is time to make needed changes. Add value to your home with a kitchen remodeling, while you add functionality and comfort as well. Your main countertop and tile on a small area of the kitchen such as an island; will be a great start to your kitchen remodeling project.

Almost each kitchen remodeling project should start out with a well-thought-out and detailed plan in order to be a positive value. A kitchen must contain a counter or table for food preparation and must contain cabinets and/or shelves for storage. Add value to your own home with a kitchen remodeling job and improve the chances of selling your home more than ever. Add value to your home by starting with your kitchen and remodeling it for an up to date look to the room. With kitchens increasingly becoming the center of functional activities it is crucial to have a functionally efficient kitchen. Adding an island can create up to two to four small work spaces of additional cook stations in your kitchen. A badly designed kitchen will be a big problem as this area tends to be a center of social and useable activities.

Brits snap up Berlin homes

Britons are flocking to Berlin as a resurgent German economy makes Europe's cheapest metropolis attractive to second-home buyers.

Brits, Irish and Americans last year spent £7bn on properties in the German capital.

Much of the spend was by institutional investors but private individuals are buying hundreds of flats. Investors have also come from Spain, Norway, Sweden and France.

Big flats in trendy areas can cost as little as £110,000.

Move slightly out and that can drop to between £70,000 and £90,000. Jurgen Michael Schick, vice president of Germany's IVD Real Estate Association, said more than €10bn(£6.6bn) was spent on Berlin properties in 2006, with 'foreign investors accounting for most of those transactions'.

Philipp Tabert, head of Berlin real estate consultancy Winters & Hirsch, said: 'Values are significantly lower than those in London, New York or even Prague and Moscow.' Almost 95% of Tabert's clients are from Britain, Ireland, America, Spain, Italy and France.

Berlin property prices dropped every year from 1996 to 2004 while in London they climbed 80%.

A renovated flat in a prime Berlin area can today cost €1,500 a square metre while one in London is €15,000.

Gary Savage, a teacher from London, said his 87-square-metre apartment in the heart of the Mitte district, for which he paid €145,000, was a real bargain.

'You couldn't even buy a garage or a shed in London today for that,' he said.

Private equity funds such as New York-based Cerberus Capital Management and Goldman Sachs' Whitehall investment fund have also been targeting Berlin. In 2004, the two together bought 65,700 units of Berlin public housing for €2.1bn.

Think Small: Getting Started as a Real Estate Investor

Even in a Sinking Market,
Carefully Buying and Managing
Properties Can Bring New Riches

The real-estate bubble has burst. Get over it. In areas that saw big home-price run-ups in the first half of the decade, prices are stagnant, or worse. New-home inventories are up; new-home builder stocks are down.

A kind of real-estate weariness has set in. Who's the cocktail-party boor? The guy still talking about making a killing on Miami Beach condos.

Smells like a buying opportunity. Probably not right away, because there's still plenty of froth in the markets that saw the biggest price increases. But soon, you'll see the real-estate investors -- property vultures who buy when prices are low and then ride property manias to their crest -- toeing the market again.

Even in today's uncertain climate, novice real-estate investors can make money, especially in smaller properties that are easy to acquire and manage.

Let's explore some options.

In-Law Units

The most basic form of property investment is a so-called in-law unit or guesthouse on the site of your home itself, sometimes attached to the main house, sometimes not. No one has ever gotten rich renting out such properties, but they can significantly reduce the cost of homeownership. Renting out an in-law unit for $400 a month and using that money every month to pay down principal on a $350,000 30-year mortgage will shave 10 years from the mortgage term and reduce total payments by more than $165,000. And you will be able to write off all your costs on your income taxes -- including depreciation on the unit -- up to your actual rental income.

Weekend or Vacation Homes

Just as with an in-law unit, renting out your weekend house is not a way to get rich. Many of the same numbers that applied to in-law units can be applied to your weekend home, although the tax situation is decidedly different.

HOMEOWNER VS. LANDLORD


Investing in real estate isn't the same as owning a house. Here's a look at the financial breakdown.First, the IRS gives second-home landlords a very nice little present in that it allows two weeks of tax-free rental income a year. Beyond that, however, the accounting can be irksome. The IRS doesn't want people buying second homes and disguising them as rental properties. It has two criteria to determine whether the property is a second home (bad) or a rental (good). It's a second home if you don't rent it out at all or if you personally use it at least two weeks a year or 10% of the number of days the place is available for rental, whichever is longer.

Single-Family Homes

Throughout much of the country, the market for single-family homes is seriously out of whack. As prices fall and inventories rise, that's changing. But, compared with rents, prices are still quite high, outstripping the ability of such properties to cover their mortgage and operating costs.

Avoid this segment of the market unless you have a chance to buy a property at a 30% or 40% discount from its previous price. Don't think this is out of the question. In the late 1980s and early 1990s, when the government liquidated the real-estate loan portfolios of bankrupt savings-and-loans, speculators picked up properties for just dimes on the dollar.

Managing a house that pays for itself is what it's all about. You can do it in one of two ways: Renting or "flipping." Renting is a "buy-and-hold" strategy, while flipping calls for quick turnarounds of fixer-uppers that can be spruced up and sold quickly.

But in the current environment renting is probably the more prudent path, although it can be very difficult to make a house pay for itself at today's prices. That's because if your house carries an 80% or 90% loan, the renter will have to pay more per month to rent the house than he would to buy it.

Look at it this way: There's a handsome three-bedroom, two-bath house in Tampa, Fla., for sale at an asking price of $199,900. If you bought it with 10% down and a 90% loan at 6%, your monthly payment will be about $1,550 (that's PITI -- principal, interest, taxes and insurance). As a landlord, at a minimum, you'll want to budget at least $200 a month in additional expenses. That puts your break-even point at almost $1,800 a month. That's far more than you can reasonably expect to earn where comparable properties in the same neighborhood can be rented for less than $1,300.

But it turns out that there's a similar house available less than a mile away. This other house is roughly the same size. The difference is this one's being taken over by its lender, and the house has a mortgage loan of $110,000.

A buyer with cash can drive a hard bargain and make out very well. And the worse the market, the better for the buyer. But don't get carried away. If you simply take over an existing 90% or 95% note, you won't make any money. Let the lender foreclose and take over the place. Then lowball the lender.

Multiple Units

A housing market that saw the price of single-family homes skyrocket was not quite so generous to smaller two-family or multifamily properties. Because the universe of home buyers expanded so much in the past 10 years, the universe of renters contracted, and the market for smaller rental properties contracted with them.

In Memphis, where two-bedroom apartments in better neighborhoods rent from $500 up to $800 a month, good two-family properties can still be bought for far less than a one bedroom condo on either of the coasts. Recent prices for 40-year-old two-family homes near the University of Memphis main campus ranged from $70,000 to $110,000. Monthly payments, including insurance and maintenance, on an $88,000 mortgage (20% down on the $110,000 property) come to only about $750 a month. So renting both units at the low end of the market would result in a positive after-tax cash flow of more than $100 a month. Upgrade the units, and you can charge top-of-the-market rents of $800 a month.

Good deals on smaller buildings can be found throughout the country, even in some of the hottest markets. In trendy Pasadena, Calif., where even modest homes can sell for $400 to $600 a square foot, two-, three- or four-unit rental buildings can be bought in the $250 to $350 range.

New real estate player set to shake up Invercargill market

Southland's property scene could be in for a shake-up this year as a new player moves into the market in Invercargill, with a system which could save vendors thousands of dollars in commission.

Former Gore man Ewen McLeod is set to challenge conventional thinking with Website Properties Limited, a website based company.

Website Properties Limited was a user pays system whereby the vendor paid a flat rate of $150 per week for access to advertising.

Included in the package are two newspaper ads per week, a website listing, flyers of the property and a for sale sign.

The vendor conducted their own open homes, but the company vetted all potential buyers.

While new to New Zealand, the sell by owner (SBO) method had already caught on overseas, taking the market share in both the United States and Scotland, Mr McLeod said.

He believed the same could happen in New Zealand in time.

While Website Properties was a listing agency, rather than a real estate company, it offered people an alternative, he said.

"Three years ago real estate agents were charging 4 percent commission on average.

"Properties prices had doubled in that time, and so have real estate agents salaries."

Many real estate agents were also wanting an advertising fee up front, he said.

Based on a property worth $150,000, and with an average selling time of 34 days, the system could save vendors thousands of dollars, he said.

Mr McLeod established Website Properties Limited out of Christchurch in October.

His experience includes 26 years in the real estate industry in Christchurch. He plans to have a franchise in Invercargill in the coming weeks and 60 across New Zealand before the end of June.

"The Joneses started reinventing real estate, we are saying we have reinvented it," he said.

Real Estate Institute of New Zealand president Murray Cleland said many "fly by nighters" had come and gone from the industry in his 25 years in real estate.

The fact that many of them had gone again told him people wanted the security of dealing with a licensed agent, he said.

Mr McLeod was the founder of No Commission Property in New Zealand.

8 Real Estate Negotiation Tips

When buying a real estate investment property you need to be aware that negotiation plays a big part on your bottom line, or the potential profit you could make. Below are 8 great negotiation strategies that you can use when buying real estate.

1. Check if the seller is motivated to sell the property
In real estate investing, dealing with someone who does not really want to sell their property is a waste of time - you should forget about them and move on, no matter how promising the deal might look like. How to check the seller's motivation level? It's relatively simple: try to make an appointment. If he or she puts it off (especially if it happens a few times in a row), there is a 90% chance that the seller is not motivated to sell.

2. Inspect a property before making your first offer
Never, ever make an offer before a close inspection of a property. This will put you on the back foot throughout whole negotiation process! Also, don't let the seller force you into making your offer RIGHT AFTER the inspection. You will need at least a few hours to prepare your final offer. It's best to inspect the property and then make an appointment for the following day. Do not make any offers before that time!

3. Prepare more than a single offer
Do not enter negotiations with only a single offer. Even if you don't have any aces in your sleeve, make sure that you can make at least three offers - and that your final one is still profitable enough to enter the deal!

4. Talk to the seller while leaving
If you and the seller can't reach an agreement, try this simple trick: make your final offer standing at the door. First off, this way you give a clear sign that the seller can't hope for a better deal. Then, this puts the seller on notice that you are about to walk away from the deal - he or she may not like your offer, but there is no guarantee that the next real estate investor will give the seller better terms. This can often make the seller more receptive and accept your proposition.

Selling your investment property:

1. Be sure that you really want to sell the property
Before you tell anyone that your property is on sale, think if it is really the case. If you deeply hate the idea of selling the property, it is generally a good idea to try to keep it. Every real estate deal has pluses and minuses. If you sell, you get instant cash profits, but sacrifice long term capital growth. If you decide to hold, the opposite applies.

2. Be reasonable
When it comes to negotiations, don't be ridiculous. You can demand high prices, but make sure that they are reasonable (certainly not twice the average). You will only be left with an overpriced property that will be difficult to sell. Moreover, making such high offers may cause some real estate investors to back out from the negotiations. You usually can hope for more than the buyer's first offer though, so it is always worth to haggle a little.

3. Read through all the clauses and contingencies before signing anything
There's an old saying: "The devil's in the details." Nowhere is it truer than in real estate deals. Before you sign anything, read the contract (especially the small print). Such things as being held responsible for making all necessary repairs requested by the buyer or agreeing for waiting six or seven months for the money may spoil even the best-looking deal.

4. "There's always another buyer around the corner"
If the purchaser does not seem to be able to meet your price expectations or offers you terms you cannot really accept, don't waste your time. There is always another purchaser around the corner - and even if there won't be anyone else, you can always call the buyer later, can't you?

Real estate on the run

After a prolonged downturn, the Asian property market is once again red-hot, with rents and valuations soaring in virtually all major cities around the region. This means there’s rarely been a better, or busier, time to be part of the real estate industry. But as buyers, sellers and investors flock to property companies in droves and the pace of deals moves into overdrive, many firms and agents struggle to keep up with the latest market developments. The ability to receive and transmit information quickly, and to do so just about anywhere, have become some of the industry’s most precious commodities.

This has translated into good business for SISV Services, a subsidiary of the Singapore Institute of Surveyors and Valuers that provides market data and technology to the city-state’s burgeoning network of realtors. SISV Services chief technical officer Henry Tan recognised the value of empowering employees to work on the move early and has been a staunch advocate of mobility ever since, a strategy that has proved a source of competitive advantage to the company but also introduced risks.

Early adopter
As the host of Singapore’s leading online property portal and a series of real estate transaction databases, SISV Services had to buy in to relatively high-end network infrastructure early, signing up for high-speed broadband and voice over internet protocol (VoIP) when these were relatively untested. This created a platform for the implementation of mobile broadband, outsourced network, and corporate messaging solutions that make sure clients and employees can stay in constant contact with the main office regardless of physical location. This means databases are constantly updated and the information that SISV feeds to clients is as current as possible. Up-to-date facts and figures on the property market are the company’s bread and butter, so Tan says SISV Services’ investments – around US$1.9 million (S$2.9 million) since 1999, most of it going to Singapore-based communications provider LGA – have proven more than worthwhile. Mobility infrastructure allows realtors and valuers to trade data with the firm instantaneously through a range of portable devices like smartphones and personal digital assistants (PDAs), while VoIP can substantially cut communications costs, especially as the industry grows more international and staff are required to file reports or stage presentations in overseas markets.

But for any firm considering similar deployments Tan has a few words of caution. The first is to choose your provider carefully – SISV Services, for instance, found Singapore incumbent SingTel too costly but wasn’t prepared to put up with the technical and support issues that frequently accompany implementations done on the cheap.

Tan says LGA hit the right price-service balance and, importantly, has proven ready to go the extra mile for its customer base by adjusting its prices for services like leased lines as market rates drop.

Stay safe
Security is also a major issue for the heavily connected enterprise, a fact that became only too apparent a few years ago when a rival firm attempted to hack into SISV Services’ databases. Tan says this was when a good relationship with its main vendor became crucial; LGA helped the firm pick out odd network traffic patterns and track down the suspect. SISV Services has since made defence one of its top priorities.

“We’ve carefully controlled the data sets we have, and instead of holding everything in one server we’ve split it across four – even if someone hacks into one, they can’t hack into all of them,” Tan explains.

“In 2004, when we began to implement a wireless LAN and remote dial-up solutions, due to the associated security issues we implemented a (virtual private network) and firewall right away, even for people using PDAs. It’s important to resolve (security) issues at the implementation stage.”

But Tan says the biggest mobility-related challenges facing the IT director have little to do with technology. “The problem is basically the end-users,” he says. He stresses the need for regular training to not only acquaint them with how to use tools like wireless broadband or smart phones, but to make sure these are used in a way that doesn’t jeopardise corporate information. This can be as simple as avoiding open-access wireless networks and setting up authentication mechanisms for PDAs or laptops.

Sharing the wealth
SISV Services’ experiences with mobility have proven so successful that the company now markets the solutions to real estate firms. “I’m no longer desk-bound, which has nearly doubled my business and productivity,” says Veron Real Estate agent Francis Chew, who uses mobile broadband to access SISV Services’ market database and VoIP to connect with customers and the office on road trips. “The ZIPdial (VoIP) service has also cut the cost of overseas calls to my customers – the only down side is that sometimes the sound quality isn’t as good as a standard IDD line, but given the price it’s still reasonable.”

BUSINESS INTELLIGENCE
Don’t forget the users


Rolling out a new BI tool involves a change in mindset, Hitachi Asia finds out.
Think you’ve done a good job putting in the latest tools that are able to generate the prettiest spreadsheets and multi-layered analysis? Even if you have all the infrastructure in place for the “perfect” business intelligence (BI) implementation, some things might still stand in your way—the user—as electronics manufacturer Hitachi Asia has learnt.

For years, managers at its Malaysian air-conditioning products plant were inputting business data by hand from hard copy to Excel spreadsheets. The process was slow and tedious, with sales and expenses needing to be summarised and consolidated into the spreadsheet, or printed for management reviewing and analysis.
Also, data was unstructured and lumped together in one category, due to the format in which they were saved, as cells in one spreadsheet. Not only was this difficult to classify, this made data analysis a muddy affair.

With final reports reaching Hitachi Asia’s headquarters in Singapore a week later, efficiency along the entire supply chain was also hampered.

Upper management then decided to introduce a BI system, targeted at middle managers, in the hope of easing data analysis by providing a dashboard from which to access and manage crucial business information. Management thought that since users were already familiar with Excel, it should also buy BI tools from Microsoft. Hitachi later paid for making the wrong assumption.

For one, ProClarity, a BI tool from Microsoft, wasn’t developed by the software giant. ProClarity was acquired to “boost sales”, Chris Caren, a Microsoft Office general manager, reportedly says.

Zainuddin Anang, Hitachi Asia’s business solutions manager, who oversaw the implementation, admits: “Using a new tool—ProClarity—created some difficulty and discontent to some users.”

According to him, most users at the plant were expecting a completely automated system where one push of a button would generate the required analysis. Instead, the tool presented them options, which with the appropriate training would have enabled them to manipulate data powerfully. But Hitachi over-estimated middle managers’ ability to master the tool, allocating only two days for training. Zainuddin says the learning curve was fairly steep for managers.

“If I’ve to do it all over again, I would definitely concentrate more on the user experience.”

Thankfully, he says with a laugh, the middle managers were given sufficient pressure from their bosses at the plant as well as regional headquarters to use the system. IT personnel from the headquarters were sent to the Malaysian plant to give users individual attention and additional training.

Through this experience, Zainuddin says he has learnt that “BI isn’t something you just roll out and wait for results from. The process to fruition is tedious, and mostly you have to combat mindsets, because this is relatively new to the mainstream.
“End-users need to see BI as a useful tool, not just another input process.”

Global Real Estate Prices to Drop: SERI

An economic think tank in Korea says global real estate prices will enter a correction phase this year. The Samsung Economic Research Institute says that's due to a drop in global liquidity stemming from interest-rate hikes in the Eurozone and Japan.

Low interest rates in those regions have led more people to take out loans to buy real estate. The U.S., which was among the earliest to drop interest rates, should be the first to see real estate prices drop.

2006 was real estate 'wow' year

San Antonio real estate had a jaw-dropping year in 2006, with San Antonio builders starting more homes than there are residents in Alamo Heights, Boerne, Castroville and Lytle combined.

Builders started 19,092 new single-family homes, 15 percent more than in 2005, according to Metrostudy, a housing research firm. (There were 18,554 residents in those cities in 2000, based on U.S. Census numbers.)

It marked the sixth consecutive year of record-breaking building, and was an impressive enough number to cause a roomful of 750 real estate professionals to gasp collectively at Wednesday's 2007 Housing Forecast event.

The exuberant building pace and shocking statistics are unlikely to make repeat appearances this year, however.

San Antonio housing has seen a significant shift, and the market for new and existing homes isn't as strong as it was at this time last year, said Jack Inselmann, a new-housing analyst with Metrostudy.

Home-buyer traffic has slowed in new neighborhoods and builders are having a harder time closing sales — a change many builders started noticing during the summer.

But don't cry for the builders.

They'll still start construction on 17,000 homes this year. It's an anticipated decline of 10 percent to 15 percent, but would still be the second-best year on record — after 2006.

"The housing bubble has burst, right?" Inselmann said. "All is lost, right? Absolutely not."

A continuing healthy job market and the arrival of new residents will continue to fuel the need for new homes, he said.

Home buyers closed on 16,988 new single-family homes last year, up 17 percent from 2005.

But housing starts peaked from late 2005 until October 2006, when San Antonio builders reached 19,527 annual starts, a 30 percent increase over the comparable period the year before.

Since then, in the fourth quarter of 2006, the pace of annual housing starts dipped 2.2 percent, Inselmann said.

An abundance of investor interest in San Antonio last year — driven by a December 2005 Fortune magazine article — should be coming to an end.

Fortune projected that the Alamo City would be the nation's best real estate market in 2006, and out-of-state investors who had cashed out on the East or West coasts headed to Texas.

In the end, however, San Antonio ranked 95th nationally in price appreciation, with the median price of existing homes rising more than 7 percent and average sales prices rising 9 percent, Inselmann said.

Out-of-town investors created an artificial market when they made down payments on homes and then canceled their contracts when they figured out they would be able to flip a property for a double-digit gain.

"It's probably the worst thing that affected our market this year," Inselmann said. "I think we've gotten most of those people out of here."

San Antonio's inventory of new homes for sale rose as a result of the investor interest, but builders were lucky.

San Antonio was left with a 1.7-month supply of new homes for sale, still the lowest in Texas.

"We came close to making an error in our housing market," Inselmann said.

San Antonio real estate has been on an upward trend since 1990, when builders started just 2,000 homes.

"This market is on a 17-year run," Inselmann said. "Ladies and gentlemen, it can't go on forever."

San Antonio's market for existing homes has also been on the rise, with prices and sales volume rising in virtually every part of the metropolitan area.

"When we thought things couldn't get any better in the real estate industry in 2005, we were wrong," said Tom Patterson, chairman of the San Antonio Board of Realtors.

While several boom markets around the country have faltered in the past year, San Antonio residents and real estate professionals can be thankful for growth that traditionally moves at a steadier pace, Patterson said.

More than 24,000 single-family homes changed hands in 2006, up 6.6 percent over 2005.

As long as interest rates remain low and San Antonio's job growth continues, the real estate market should remain healthy, Patterson said.

Top 25 Market Forecast Shows Real Estate Stabilizing

The annual Top 25 U.S. Housing Market Forecast for 2007 shows a growing trend of real estate markets that are stabilizing with 13 states represented.


The Top 25 Housing Predictor U.S. Market Forecast for 2007 shows a growing trend of local real estate markets that are stabilizing with thirteen states represented in the annual forecast. Housing Predictor is an information driven website, providing independent local housing market forecasts for all 50 U.S. States.

Battling back from the headlines New Orleans, Louisiana is Housing Predictor’s # 1 pick to appreciate the most in 2007. Despite the loss of nearly half of its residents, the Big Easy has a booming real estate market that is growing almost daily and is forecast to appreciate 8.4% in 2007.

The fixer-upper has become the new major commodity in New Orleans real estate as investors move into the market to repair homes and apartments damaged in the wake of Hurricane Katrina more than at any other time in a natural disaster in the U.S. More than 150,000 homes were damaged or destroyed by Katrina, which hit in August of 2005.

The spirt of the people in New Orleans is becoming less tarnished in the aftermath of the storm. New Orleans has always had a spirit of revelry and showmanship, especially during Mardi Gras. It may have also been given a boost in the form of the New Orleans Saints football team, which has had its best season in years.

Houston, Texas, a city which has been besieged by scandals with Enron and other companies is transforming into a strong real estate market for the first time in more than a decade. Houston is forecast by Housing Predictor to appreciate 7.3% in 2007 to place second in the forecast.

The nation’s southern states are under going the largest growth in history as a migration from colder northern states to the sun-belt quietly reaches near fever pitch. Arkansas, Alabama, Texas and Tennessee are adding more new residents than ever before. Little Rock, which was once a slumbering community has more new businesses moving into the area than ever before and will hit 7.0% in home appreciation in 2007, according to Housing Predictor.

Nashville, Tennessee, recognized as the Music City is playing on its good fortunes as a growing metropolitan area, which along with Odessa, Texas has some of the most affordable housing in the nation and will both hit 6.9% in appreciation by year’s end.

The Top 25 markets represent slightly more than a quarter of the nation’s states. All 13 states have local real estate markets that are appreciating strongly.

In the west, Washington state and Utah have real estate markets that are showing appreciation, which demonstrates how real estate unlike other investments is effected by local regional market economic and political factors.

In Albuquerque, New Mexico the sales of homes and condos had slowed for a few months only to pick back up again as more and more new employers moved to the area. Albuquerque is a growing urban center, which is forecast to appreciate another 6.5% in 2007.

But of all the places that made the annual Top 25 markets list Brownsville and Austin, Texas are two of the strongest U.S. real estate markets. Just a few short years ago after a high tech boom went bust Austin lost population, but a renewed economy and more computer companies moving into the area have pushed the city into a booming economy again and it will score a forecasted 6.1% in appreciation in 2007. Brownsville, which is in seventh place on the list is perhaps the best place to find the least expensive housing in an urban center in the U.S.

Beijing real estate prices to keep rocketing

An 11% increase on real estate prices in any year is considered more than healthy. But, on top of several years of increases and despite government action to tone it down the forecast is that the strong demand for new housing and office space in Beijing will real estate prices up by 11% in 2007. This according to a market report which predicts a slightly lower increase than in 2006.

The report was released by Jones Lang LaSalle, an international property consultant and investor, which is serious expert in this area. It said prices of newly built houses will rise between 11% and 14% this year, while the cost of renting property will remain stable or decline slightly.

According to the report, real estate prices will maintain their years-long upward momentum in the first half of 2007, and then become more stable in the latter half of the year. Predicted price increases are the result of surging economic development, rising individual incomes and the Beijing Olympic Games.

A report released by the website Sina.com and New Real Estate Magazine shows real estate prices in Beijing have increased by 42% over the past three years. The report states that in 2004 new homes sold at an average price of RMB6,178 per square meter. By 2006 that figure had soared to RMB8,792 ($976.9), a jump of 42% in three years.

Another report, by the national real estate company Homelink shows that the average cost of a home was 9.4 times greater than the average annual disposable income of Beijing families in 2005.

According to the World Bank, the cost of housing should not be more than five time sgreater than a buyer’s annual disposable income. The United Nations puts the figure at three times.

Municipal statistics show that the average family’s disposable income in Beijing was RMB51,193.7 ($6,399) in 2005, while the average price of a new home was RMB 480,000.

Real Estate Blogger Meetup at Hudson Hotel

Blogging Systems staff were invited to a real estate blogger meetup at the Hudson Hotel tonight to give us an opportunity to get acquainted and do some networking before the Inman Real Estate Connect conference, which starts tomorrow (Monday). I was the only one of our staff who made it, but was sure glad I did. These are a great group of people!

Among the attendees were John and Mary from RSS Pieces, Joe from Sellsius, Joel from Future of Real Estate Marketing, Steve from Agency Logic, Phil from Wellcomemat.com, and a few others. (Sorry, but I’m terrible with names. If I left you out it wasn’t on purpose. Consider the fact that I didn’t even bring business cards to this gathering!)

The Hudson is a New York original. If you’ve never been, you ought to go, but maybe not for the rooms, which I’m told are cracker boxes. But, the rooms are not what the Hudson is about anyway. (I’m sure my wife will tell me the Hudson is one of the places frequented by the gals from Sex and the City.)

Anyway, we kick off the conference tomorrow. If you’re attending, please drop by our booth (#306)…and take some time to meet these and other real estate bloggers. You’ll recognize them. They’ll be the ones looking for something to write in their next blog post!

PS: I don’t know how I missed getting a photo of her, but I notice that though I got John, I have none of Mary McKnight. Sorry Mary!

Real estate lawyer pleads guilty in scam

A former Trumbull resident pleaded guilty in late December to defrauding People’s Bank of $1.2 million, and faces a likely prison sentence of four to five years and a fine of at least $1 million.

John M. Claydon Jr., a real estate attorney in Fairfield, admitted that in 2004 he diverted People’s Bank loans intended to refinance mortgages on houses owned by associates in Greenwich and Madison.

Claydon has repaid the Bridgeport-based bank $470,000, and his plea agreement requires him to repay the remaining $730,000.

Claydon is being held in custody in Suffield, and is scheduled to be sentenced March 12.

Parker businessman launches real estate radio show

James A. Holmes, Director, Private Mortgage Banking for Cherry Creek Mortgage Company has launched a new real estate and mortgage talk radio broadcast on radio station 94.7 KRKS FMand 710KNUS AM . The broadcast is designed to be a resource for anyone interested in selling, buying, and financing real estate including both consumers and industry professionals. The broadcast can be heard Saturday afternoonfrom 2:00 - 2:30 PM MST on 94.7KRKS and from 2:30 - 3:00 on 710KNUS. The program can also be heard via audio streamworldwide on the internet at www.710KNUS.com.

Host James Holmes shared his thoughts on establishing the show: "My objective is to build a community of listeners rather than a traditional audience. Think of a neighborhood, the foundation is put into place by planners and developers, individuals move into the newly created neighborhood one at a time, get to know one another, interact and engage together - forming a community. That is my objective, to put into place a foundation - our show, and invite each of you to engage with us and form a community of listeners. Talk radio is powerful because it is interactive and a safe place to ask questions, share opinions, and contribute to the knowledge of others."

As a licensed real estate broker, certified mortgage lender by the Colorado Mortgage Lenders Association and past Chairman of the Colorado Real Estate Appraisers Board, James Holmes will bring 20 years of his unique experience and passion for real estate to a community of listeners.

The "Real Estate Today!" team seeks to add value for you and to do so with Integrity. In addition to host James Holmes, a team of real estate professionals will contribute to the broadcast. Bob Speaker and Bruce Deffler are Certified Residential Specialist and Brokers with Benchmark Property Advisors, affiliated with Keller Williams Real Estate. Deb Ayers and Terri Davis are Sr. Loan Consultants with Cherry Creek Mortgage Company, Inc. A website has been created to support the show and provide free resources for listeners, which can be accessed at www.RealEstateTodayShow.com

A few Commercial Real Estate Terms

I mentioned in my earlier post that I have been learning about the Commercial Real Estate business due to my involvement in trying to get a Masonic Lodge built. I am by no means an expert but here are a few terms I have learned in trying to get a grasp of the market in rentable office space.

Net Rentable Area. This is the total number of square feet of rentable office space in a given area. In my case we are talking about the area of Mountlake Terrace and Edmonds.

Not included in this number is office space that is owned outright by its occupants. It is all the space in the area currently being rented plus all the space that is currently vacant but is on the market to be rented. This number is important, not only because it is critical in determining the areas Vacancy Rate, but it also tells you what sort of impact your new building may have on the existing market.

For instance you may have a vacancy rate of 10%, but if your new building will double the amount of office space in the area, then there is a good chance that adding that space will have an impact on the vacancy rate...basically you are drastically increasing supply and chances are that demand will not increase significantly so prices will go down. In my little venture we will be increasing the Net Rentable Area in Mountlake Terrace and Edmonds by about 2%. I believe this change is small enough that we should be able to maintain the current vacancy rate in the area.

In fact, considering our location and the fact that we will be new construction, I'm hoping we will be reducing the vacancy rate in the area.Vacancy Rate.The vacancy rate is the percentage of the Net Rentable Area that is currently not rented.

This is probably the key market analysis number that investors need to be aware of. An area's vacancy rate is probaly a good indicator of what the vacancy rate in your building will be. Therefore if you need to have 2/3rds of your building full in order to break even, and the vacancy rate is 11%, then you should go ahead and invest since 89% of your building will be projected to be full (well past your 2/3rds requirement).

My gut tells me that vacancy rates are not all they are cracked up to be. For instance, say the current vacancy rate in our area is 20%. In preperation of building our building we start lining up renters and say we get to 60% of the space rented.

I'm told banks will not loan you the money to build until you have 60% of your rentable office space committed. Now in all the office space rental situations that I have been vaguely a part of (about 4 situations that I know of) the length of lease has always been 5 years. So if we are at 60% today, you know you will maintain at least 60% over the next 5 years.

But the remaining space does not come off the market. Agents will continue to try and rent out the space. Therefore you would expect that the occupancy rate in your building will increase over time as the last few chunks of your building's space is rented.

After five years, you may find that some of your renters will leave as their first lease finishes. But the good news is that inflation will kick up rents so you won't have to maintain as high a vacancy rate to break even. I will leave it at that for now since it is getting late.

More real estate terms ahead..

Gadgets, Games and Gizmos: Virtual Real Estate for Sale

Traveling to Calypso is similar to traveling to any foreign country. You exchange your currency for the currency of Calypso and, when you return home, you can exchange left over Calypso currency back to your currency. The only difference? Calypso is not a physical place—not a Caribbean island. It is a virtual world—a metaverse (short for “Metaphysical Universe” aka “online world.”)

In the Calypso metaverse, you exchange real money for virtual money and then, exchange it back. Calypso has its own virtual economy which works almost seamlessly with physical economies. The enviornment, once called Project Entropia (now called Entropia Universe), is free to download and has no monthly fees unlike most MMORPGs. Instead the universe works on a cash basis. You are required to have cash to purchase items like a laser rifle, a house or a vehicle. Cash is King. The Project Entropia Dollar (PED) has a fixed exchange rate linked to the US Dollar currently 10 PED = 1US$.

Once inside the game, you create items to barter with other players, get a job and even find hidden treasures throughout the virtual world. You can mine items of value like gold or ore, manufacture goods or even set up a store or mall and rent out space. Trade on the virtual stock exchange. You constantly exchange PEDs for goods. To date, the largest transaction was for a virtual astroid that sold for $100,000.

Well, the ante has just been raised. After 10 days of bidding for three digital malls the virtual buyers have ponied up a total of $179,668. This is all for "virtual real estate." Places that physically don't even exist.

You can read the article 'Project Entropia' real estate sale fetches $179,000

What does this mean for trainers and instructional designers? It means we really need to understand these 3D online worlds because it is not just Second Life, many online worlds exist and if we let this technology pass us, then we will be playing catchup. Arguing about whether or not these platforms are "learning platforms" is less relevant than figuring out how to provide learning experiences within these worlds...teachable moments.

The educational philosophy of Constructivism is a good place to start in terms of thinking about how learners can create meaning. What if there was an environment where a learner, learning about history or learning about making a sales call could experiement in a relatively safe world with total access to any information he or she needs in 3-dimensions (just like where we really live). The dimensions and the immersiveness of the experience add to the learning.

We are incredibly effective learners (humans that is) we can learn from books, each other, observation or even from a good story...however, as instructional designers our job is to make that process more efficient and effective. If people could simply learn from others in an effective way...then instructional designers would not be needed but every expert is not a good facilitator, teacher or mentor, every person is not able to learn from a journey to many blogs and then reaching their own conclusion (mostly because of time constraints) so, we as workplace learning professionals must be on the forefront to understand how these technologies will impact the future workplace and what we can do to facilitate learning.

We might not like these environment, we might think they are silly or even a passing fad, of course the same was said for television, computers and the Internet.
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Search Engine-friendly Blogs Broadcast Real Estate

Real Estate Webmasters, a free community of Web savvy real estate professionals and their developers, have released REW Blogs to the public. This free blogging platform provides Realtors a venue to publish their articles and communicate to their online audience their knowledge and insight. This platform was developed to address a serious lack of professional free blogging platforms available to Realtors.

REW blogs are unique in many ways, most notably, they allow integration of elements unique to the real estate industry such as properties for sale and Google base property feeds. Real Estate Webmasters has also eliminated the clutter of traditional free blogging software' by including only the essentials in the control panel. Posting is as easy as opening a WYSIWYG editor, writing your blog post and hitting submit. Instant Web authoring has never been easier.

In addition to making this new blogging platform available to the real estate industry at no charge, Real Estate Webmasters integrated the free blogs right into the Real Estate Webmasters community. This means that when a member makes a post to their blog, that article is exposed the millions of consumers and industry professionals each month.

Arizona Real Estate Buyers & Sellers Forecast 10% Increase in Property Values in 2007, According to Arizona Tax Liens.com

Tucson to increase 13.5%, Phoenix 11.1%, Prescott 10.3%, Flagstaff 9.8%, Sedona 9%, Buckeye 8.5% and Lake Havasu City 8.2%

In Q4 2006, Arizona Tax Liens.com surveyed 5,000 buyers and sellers of Arizona real estate to determine what they expected of Arizona property values in 2007. The survey showed that buyers and sellers foresee an increase of 10% in Arizona property values in 2007 due to the large number of people immigrating to Arizona, which is being fueled by high tech and biotech job growth in Tucson & Phoenix, low housing costs and baby boomers buying their retirement homes.

Of the 5,000 people surveyed, 59% planned on buying real estate in Arizona in 2007, 32% planned on selling in 2007, 8% already own and do not plan on selling in 2007 and 1% do not own and are not buying in 2007.

52% of the buyers surveyed plan on buying in Tucson, 29% plan on buying in Phoenix, 12% plan on buying in Flagstaff, 4% plan on buying in Prescott and the remaining 3% plan on buying in other areas of Arizona.

69% of the sellers surveyed plan on selling in Phoenix, 21% plan on selling in Tucson, 5% plan on selling in Flagstaff, 1% plan on selling in Prescott and the remaining 4% plan on selling in other areas of Arizona.

Buyers and sellers ranked Tucson as having the best appreciation (13.5%) for the following reasons:

* High Paying Jobs: Tucson has a large and growing number of biotech and high tech jobs - 26,500 jobs added in 2007.
* Affordable Housing: attracting California immigrants
* Population Growth: Tucson population reached 1 million in November 2006 and is expected to increase 25,000 to 30,000 a year up until the 2 million mark.
* Downtown Tucson Revitalization: The Rio Nuevo Project is bringing new attractions, housing, commercial development and restaurants to Downtown Tucson.
* High End Home Demand: Strong interest from buyers of high-end condos being built in downtown Tucson for $300,000 to $1 million.

Buyers and sellers ranked Phoenix as having the second best appreciation thanks to the number of good paying jobs, continued investment of businesses in the area and the expected population growth up until 2010.

View the detailed results of the 2007 Arizona Real Estate Survey at http://301url.com/76h .

Think Like a Winner in 2007

Words of Wisdom from the New Book, Trump 101

Donald J. Trump, Chairman of Trump University, knows that success begins in your own mind. So as the year 2007 begins, I'd like to offer you his thoughts on success, taken from the pages of his new book, Trump 101.

"Ask yourself whether you're doing what you want and what is right for you."

"Be positive every day. If you're not, no one will think you can succeed."

"Believe in yourself, exude confidence, and get in your competitors' way. Project yourself into their picture and upset their status quo."

"Break loose from your comfort zone by moving forward with the power and momentum that positive thinking creates."

"Zap negative thoughts and replace them with positive ones. Whatever energy you expend will build the positive stamina that is vital for success."

"Ignore the expectations of others. Stand up to your friends, family, teachers, colleagues and those who think that they know what's best for you. Plug into your own energy."

All of us at Trump University wish you every happiness, and every success, in the coming year.

Michael Sexton is President of Trump University. The quotes he offers in this post are drawn from the new book, Trump 101.

A SPECIAL NOTICE TO FANS OF THE APPRENTICE

Expanded, in-depth coverage of every episode will appear on The Trump Blog as soon as the new season starts on January 7th. If you want to be part of all the action, make a visit to the Trump Blog part of your daily routine!

How bad will the 2007 housing market be?

Economists predict that next year will be tough, but say some metro areas will hold up nicely and the future may not be as gloomy as some fear.

Americans are increasingly nervous about the real estate market in 2007. They have good reason to be. But the news isn't all bad: Interest rates will remain at historically low levels, homebuyers will see more opportunities, and, best of all, for those planning for the long term, 2009 could be primed for a comeback.

To gauge what the next 12 months might look like, though, BusinessWeek.com asked economists at leading real estate research firms to provide their outlooks for the housing market in 2007. The less-than-festive consensus: Home prices will continue to fall in some markets, and the rate of price appreciation will slow in most places. Declines in homes sales, which directly influence price trends, will set the stage for another year of price decreases in 2008. Foreclosures will continue to increase. For those struggling to hold onto their homes, their net worth will shrink as these homes lose value. Long-term mortgage rates will rise. Housing starts will see double-digit depreciation, the sharpest decline since 1991, the worst year for housing starts on record.

Grim as that might sound, there are some bright spots. Nationwide, home prices will be flat to up slightly in 2007, with many large markets seeing small increases. While new home sales will be down for the year, existing home sales will also be flat. And housing starts won't see as sharp a decline as they did in the early '90s or early '80s.

Self-cleaning market

Another reason for optimism (keeping in mind that expectations are somewhat lower this year): For many, the ongoing market correction will make the dream of buying a home a reality.

"In so many of these markets, housing became extremely unaffordable," says David Stiff, chief economist at financial data processor Fiserv Lending Solutions, who expects average U.S. home prices to appreciate only 0.1% overall in 2007. "Prices moving back in line with household income sets the stage for price appreciation in the future."

Blame the rapid run-up in prices on speculation. Taking advantage of low interest rates and good economic conditions, investors drove prices to new heights in the first half of the decade, so they could flip purchases for profit. Some markets saw price appreciation rates of as much as 50%, versus the average annual rate of about 10%.

But as interest rates rose and the gap between income and housing costs widened, homebuyers never materialized as expected. Investors have now been forced to dump their property on the market, flooding many places with homes for sale and forcing prices to a more realistic level.

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100 major metros ranked by foreclosure rates
For sale: Homes for as little as $10
America's most affordable housing markets

Time lag

"The market was in a frenzy in 2005," says Lawrence Yun, senior economist at the National Association of Realtors (NAR). "The current transition is just cleansing away the speculators." Yun expects existing home sales to slip just 0.6% in 2007, with a pickup in the fourth quarter continuing into 2008.

Home price trends tend to lag nine to 12 months behind sales trends, according to Stiff, who predicts prices will be weakest in 2008 and rebound in 2009.

The researchers at Fiserv arrive at their price forecasts by first estimating what home prices would be if housing supply and demand were in balance -- that is, if price levels were consistent with local demographic trends and household income levels. They then look at the difference between the estimated "equilibrium" price and the actual price level. If prices are too high relative to the affordable equilibrium level, the forecast is weaker price appreciation. If prices are much higher than equilibrium, the model forecasts price declines.

Construction diet

This explains why former red-hot markets like Southern California, Florida and Las Vegas, which saw the most rapid run-up in prices between 2001 and 2005, will see the sharpest declines in prices in 2007, according to home price index data from Fiserv and Moody's. The Miami area, with an estimated decline of 9.16%, will have the second-worst 2007 price drop out of all the country's metro areas. Las Vegas comes in third-worst overall, with a 9.15% forecast decline, and Los Angeles, with a 7.1% decline, isn't too far behind.

Texas didn't experience dramatic price appreciation until more recently. Consequently, the Dallas and Houston metro areas are expected to have 2007 price increases of 4% and 3.3%, respectively.

Since trends in housing starts echo price movement, it goes without saying that new home construction is headed for a major slump in 2007. Nationally, total housing starts will slide 13.2% to 1.576 million, according to the National Association of Home Builders (NAHB) in Washington, D.C. The last time the nation saw a downturn of this magnitude was in 1991, when starts dropped 15% year-over-year.

"It isn't as bad, but it's a very big decline, and one of the big reasons is because of all the investors and speculators," says Gopal Ahluwalia, vice president of research at the NAHB. In the fourth quarter, the seasonally adjusted annual rate will pick up to 1.635 million. At this point, the surplus in inventory will be gone, and prices will start to stabilize, Ahluwalia adds.

Looking for value

As with prices and sales, trends in new home construction can vary dramatically from market to market. Housing starts in the Detroit area will be among the lowest in the country in 2007, plummeting 18.3% due to continuing economic woes. Interestingly, prices will not decline, but this is largely because they cannot go any lower (Read more about Detroit's market in "The foreclosure capital of the U.S."). Seattle is the only area that will see a rise (4.7%) in housing starts, primarily because of a strong job market with companies like Microsoft and Boeing based in the area.

Ironically, even record-low new home construction numbers can be interpreted as good news for the overall housing market. With fewer homes being built, the market will be forced to absorb its current oversupply, bringing about the supply-demand balance that, once again, leads to more realistic prices. (Read more in "How buyers could save the housing market." )

"It's important to note that the value of homes isn't dropping," says Santo Rizzo, chief executive officer of Rizzo Realty Group, a national real estate investment firm in Chicago.

The normalizing market is causing "unnecessary fear" and creating a favorable market for real estate investors, says Rizzo, who recommends investing for the long term in 2007 "losers" Orlando, Fla., Phoenix and Las Vegas for their stable economies, high resale marketability, vacation market statuses, low vacancy rates and favorable price-to-income ratios.

Brighter tomorrows?

Interest rates are, of course, the wild card here. The Mortgage Bankers Association of America expects the Federal Funds Rate -- the interest rate on overnight loans between banks -- to remain at 5.3% throughout 2007, with the average 30-year fixed mortgage rate climbing to 6.6%, from 6%, and the one-year adjustable mortgage rate average staying about the same at 5.8%. According to the NAR, the Fed Funds Rate will fall to 4.8% by the end of 2007, the 30-year fixed rate will hit 6.7%, and the one-year adjustable rate will decline to 5.5%.

But no matter how you spin it, interest and mortgage rates are and will remain at historically low levels. The rest of the economy isn't in terrible shape, either -- the unemployment rate hovers around a relatively low 5%, and the stock market is in the midst of an encouraging rally.

"The law of supply and demand, more than anything, is going to be the driving force that keeps the market relatively 'flat,' throughout the year," says Rizzo. "Since we expect the economy to continue to improve, rents to continue to rise, interest rates to remain relatively low and investor supplies to be absorbed, the 2007 'flat' market will set the stage for brighter predictions in 2008."

So while 2007 won't be an outstanding year for real estate, it's unlikely to go down in history as one of the worst. At the very least, it will create an investment opportunity -- and a great lesson in basic economics.

Table: Not-so-great expectations for 2007

City	2006 median home price	2007 median home price (est.)	1-year change
Las Vegas	$324,000	$292,000	-9.9%
Miami	$329,000	$300,000	-8.8%
Los Angeles	$534,000	$492,000	-7.9%
Washington, D.C.	$421,000	$401,000	-4.8%
New York	$456,000	$442,000	-3.1%
Boston	$378,000	$371,000	-1.9%
Detroit	$115,000	$115,000	None
San Francisco	$846,000	$847,000	0.1%
Philadelphia	$226,000	$228,000	0.9%
Seattle	$385,000	$399,000	3.6%
Chicago	$278,000	$289,000	4%
Atlanta	$189,000	$197,000	4.2%
Houston	$153,000	$162,000	5.9%
Dallas	$154,000	$164,000	6.5%
Entire U.S.	$223,700	$227,500	1.70%

Median price data from Fiserv Lending Solutions and the National Association of Realtors.

Click here to see more information on how home prices, sales, housing starts and mortgages in the largest metro areas in the U.S. will be affected in 2007.

Google, Apple, Yahoo boost valley market in real estate

Commercial real estate in Silicon Valley turned a corner in 2006 that it had been approaching for three years, thanks largely to property purchased by high-tech behemoths Google, Apple Computer and Yahoo.

In the past year, Google gobbled up yet another portion of land and buildings in Mountain View's Shoreline Technology Park for $319 million; Apple announced plans to buy 50 acres in Cupertino for more than $160 million; and Yahoo worked under the radar to buy 46 acres in Santa Clara for about $50 million.

``People were saying that everyone is moving out of California and technology is going to India, but those three companies with their commitment to staying in the valley and expanding heavily has given the valley a whole new breath of hope,'' said Patty McGuigan, a 26-year veteran broker with Cornish & Carey, who handled several deals with Google.

Or as Jim Kovaleski, managing partner at NAI/BT Commercial, put it: ``These guys are saying with their pocketbooks that, `We're committed to Silicon Valley.' ''

They could grow anywhere in the world -- ``they choose to do it here.''

These deals weren't the only high marks reached in 2006. RREEF acquired the 5-million-square-foot Peery-Arrillaga portfolio for $1.1 billion in a transaction billed as the largest in valley history. The former Agilent headquarters in Palo Alto sold for a reported $95 million, and the 100-acre Pacific Shores Center in Redwood City traded to Starwood Capital for about $800 million.

Even aging real estate attracted investors. A four-building complex in San Jose sold twice in a year, first to Apollo Real Estate for $19 million and then to Lincoln Property for $27 million.

``The major user acquisitions and the major investment portfolio purchases -- that's what's driving the market,'' Kovaleski said. ``The large investor pools are placing bets on the future. And their bets are all positive.''

Such activity is significant in any market, but when companies that have become household names are doing deals, it creates a welcome buzz in a market that has had little to cheer about since the dot-com bust dumped millions of square feet in the valley.

Jeff Fredericks, managing partner at Colliers International, said action by these well-known companies echoes across the region.

``These companies are the barometers in the marketplace,'' Fredericks said. ``The combination of success from both growing Silicon Valley companies and expansions from the large, Silicon-Valley-headquartered bellwether companies made 2006 a very successful year.''

It also sent vacancy numbers downward. Almost 6 million square feet of research-and-development space was leased throughout the valley during the past year, leaving 32 million square feet available, according to preliminary figures from CPS Corfac International. That's down from the high reached in 2003, when more then 45 million square feet was available.

CPS also reported that another benchmark was shattered when vacancy rates dropped below 20 percent to 19 percent by the end of 2006, compared with 22 percent at the end of 2005, and average R&D rents rose above $1 per square foot compared to 97 cents at the end of 2005.

NAI/BT Commercial, like most firms, was still crunching the numbers Friday to determine how the valley weathered 2006, but Kovaleski said vacancy in some cities fell below 10 percent.

Mountain View's Shoreline park was one of them, according to Ellis Berns, Mountain View's economic development manager. ``After the dot-com bust, there was 28 to 30 percent vacancy,'' he said. ``We're now running in the neighborhood of 8.5 percent.

``We have several significant companies, but Google is the largest.''

The giant search engine's acquisitions plus negotiations with the city of Mountain View to build another 310,000 square feet and talks with NASA/Ames Research Center to build a 1-million-square-foot campus at Moffett Field has been dubbed the Google Effect. That means companies searching for office space need to go elsewhere.

It's the same with Cupertino, McGuigan said. ``Apple buying 50 acres in Cupertino has really sucked up all the decent availability in Cupertino,'' she said.

And Yahoo's decision to expand from its home base in Sunnyvale by acquiring 50 acres along Tasman Drive for a 2-million-square-foot campus means a tightening market in Santa Clara. Yahoo's purchase yielded another benefit because it meant that aging buildings constructed 20 and 30 years ago will be demolished, taking several hundred thousand square feet off the rent rolls.

Several brokers said companies searching for space won't even look in Mountain View. ``It's not a bad thing,'' said Phil Mahoney, a Cornish & Carey broker. ``For the other tenants, there are other places for them to go.''

It's the trickle-down principle applied to commercial real estate.

``By buying buildings, they are pushing tenants elsewhere,'' said Justin Reilly, a broker with CPS. ``Shoreline used to be a ghost town. Now there's a resurgence because of Google. And companies are getting pushed out and going everywhere else. Santa Clara is receiving them. Sunnyvale is receiving them.

``Our market is reinventing itself.''

Real Estate Search Optimization Myth #6

The Continuing Series; Search Optimization Myths:
Get ranked for the top 20 most voluminous words and you will be successful

I am realizing that I covered a bunch in SEO Myth #8 . So check that out on moreOverture reasons why targeting mostly the biggest phrases is short sighted.

As I mentioned before in this series, a position is just a possibility. And if you target generally, you will get general traffic.

So using the logic of high volume words will get you more traffic seems true on the surface. However, that logic dictates that you should target the term "real estate". Probably the most voluminous word there is in the industry.

But what do you want a buyer searching in Queens, when you sell Haight & Ashbury property? So, you have to get more specific. And specifics are sparce in volume, but lethal in creating a smaller "tootsie roll" ratio.

The best scenario of all is to go after the general and specific phraseology.

1. PageRank & Metatags are everything
2. A top ten position will solve all your sales problems
3. SEO is metatag manipulation
4. Content is King
5. The engines love blogs more than regular webpages
6. Get ranked for the top 20 most voluminous words and you will be successful
7. If you just get rankings and Traffic you will be Successful
8. SEO is the single most important action you can do for your website
9. Its all about more links!
10. There are magical shortcuts to getting SEO traffic

Technorati Tags: Long Tail, Real Estate SEO, SEO, SERP, Top Positions

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Is the Real Estate Market Still "Hot"?

In the comment section to the 2007 prediction post, Lou and I debate whether the real estate market is still bubbling. Apropos of which, I offer the following paper by David Zetland, The Hot and Not-so-Hot Index of Real Estate Marketplace Trends:

ABSTRACT: Realtors, home owners and home buyers want to know whether the real-estate market is hot. Most would agree that the market is hot when prices and transaction volume are high and the time it takes to sell a house (days on market) is low - relatively speaking. I propose, explain and calculate a Hot and Not-so-Hot Index (HANSHI) that combines these three characteristics into a summary measure of market activity.

The HANSHI can be calculated for any set of home sales (by city, builder tract, zip code, bedrooms, etc.) in two, different ways: The Moving-Average HANSHI compares activity in one month to the year it completes; the Seasonal-Average HANSHI compares the current month to the same month in other years. A higher HANSHI indicates a hot market; a lower HANSHI indicates a not-so-hot market. The HANSHI can objectively clarify the status and trends in any real estate market.

In a sample calculation using over 15,000 transactions in Mission Viejo, California, it is clear that the local market has not been hot since October, 2005.

Now we just need somebody to run the numbers for, say, Los Angeles.

Library Court Los Angeles Condo Urban Living

A new and exciting property has just been launched at West 6th Street in downtown Los Angeles California and it is called the Library Court LA condominium homes. Sheer glass and metal exterior facades with extra-ordinary interior amenities are signatures of the Los Angeles Library Court condominium homes and real estate properties.


If you are looking for a condo community that features the most impressive of liveable floor plans, community oriented amenities and features as well as an excellent location in Los Angeles, the LA Library Court condo residence apartments are the key to your future. From a playroom to a fitness center and from a Library Lounge on the roof top, the Library Court LA real estate property development is one of the fresh new urban living spaces that combine traditional construction with new modern low maintenance living for families, couples and singles. In addition, the zen like Library Court that includes Wolfgang Puck, Mitaki Sushi, a Library Bar as well as the subway just steps away, the Los Angeles real estate market is welcoming a new addition to the bright and contemporary property developments in the most amazing district along West 6th Street. View a photo gallery on the LA Library Court apartment condo website today and also be the first to know about Library Court and its updates in the real esteat property Los Angeles development by pre-registering online. The LA real estate property at Library Court will feature studio condominiums, one and two bedroom downtown homes that will start from the three hundred thousand US dollar range, which is very affordable for downtown Los Angeles living in a new construction condominium residential building.

Contacting the Library Court LA condo residence homes today!

‘Get Courted’ at Library Court is the LA real estate marketing strategy associated with this premier address in downtown Los Angeles CA. Right now, the downtown homes at the Library Court real estate properties are listed from the four hundred thousand US dollar range for one bedroom homes. In order to have a chance to purchase one of these prestigious and exclusive downtown LA residences at Library Court, you will need to follow a few simple steps for registration and pre-qualification. Firstly, get on the interest list of the Los Angeles Library Court residence apartment homes today and receive news and update releases during the course of the construction phase. Secondly, the sales team at the Library Court Los Angeles downtown condo residences are suggesting that all prospective home buyers pre-qualify for Wells Fargo Home Mortgages so that you are not disappointed or slowed down by the purchase process. To download an application for prequalification for the Library Courts LA condo downtown homes, please go online and download the PDF form and fax it back to 310.234.8501. Lastly, you should call the LA Library Court sales center today at 213.488.1931 to book an appointment to tour the property and to make your purchase decision. LA real estate in downtown is hot right now, so the Library Court downtown condominium residences are expected to sell out very quickly.

An overview of the Library Courts LA real estate development

The condominium downtown homes community will consist of six stories (low-rise residential) that will feature ninety homes. ON the first floor of the Los Angeles Library Court real estate properties, there will be the Library Bar for entertainment and drinks, Wolfgang Pucks for exceptional dining, a few retail and casual dining spots, the fitness center as well as Units 101 – 105 which are all townhome houses at Library Court with two floors, two beds, two bathrooms and approximately one thousand one hundrd and forty two sq ft to one thousand one hundred and seventy nine square feet. The second floor of this real estate property in Los Angeles Library Court homes will feature many studio homes in addition to one and two bedroom condominium style apartment residences. From studio homes of five hundred and ninety square feet to 2 and 2 baths with over 1185 square footage, the second to the fifth floors contain the majority of the ninety luxury homes at Library Court Los Angeles CA. The penthouse level will also feature a similar layout with approximately the same unit configurations. Some of the sleek interior design features at the luxury homes at Library Court LA will include hardwood flooring, stainless steel kitchen appliances, granite counters, washer and dryers in addition to floor to ceiling windows. In addition, other great features at the Library Court Los Angeles homes and real estate property will include direct elevator access form the garage to each home, natural lighting, townhouses with private patios as well as nine to fifteen foot ceilings for the loft style residence homes.

Final summary of the LA Library Court Homes

Just around the friendly neighbourhood of downtown Los Angeles, the Library Court residents will find plenty of food, art, entertainment, shopping, nightlife and other local conveniences just next door to their private homes. The Library Court Homes and condominium apartments ware located at 630 West 6th Street in Los Angeles California 90017. The telephone number for the LA Library Courts real estate project is at 213.488.1931 and the fax number is 213.488.1943.

REAL ESTATE: November 2006 Existing Home Sales Rise Again; Still Well Below November 2005 Pace

Washington, DC -- Existing-home sales continued to recover in November 2006 following a rise in October, with the level of sales activity suggesting a turn in the market, according to the National Association of Realtors.

Total existing-home sales – including single-family, town homes, condominiums and co-ops – rose 0.6 percent to a seasonally adjusted annual rate of 6.28 million units in November from a level of 6.24 million in October, but were 10.7 percent below the 7.03 million-unit pace in November 2005.

David Lereah, NAR’s chief economist, said modest gains are expected for home sales. “As the housing market recovers from its correction, existing-home sales should be rising gradually during 2007 – it looks like we may have reached the low point for the current cycle in September,” he said. “We’ve entered a more sustainable period of home sales now, and we expect greater support for prices over time as inventory levels are eventually drawn down.”

Total housing inventory levels fell 1.0 percent at the end of November to 3.82 million existing homes available for sale, which represents a 7.3-month supply at the current sales pace.

The national median existing-home price2 for all housing types was $218,000 in November, which is 3.1 percent lower than November 2005 when the median price was $225,000. The median is a typical market price where half of the homes sold for more and half sold for less. “For every 1.0 percent drop in home prices, we project an additional 50,000 buyers are drawn into the market,” Lereah said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.24 percent in November, down from 6.36 percent in October; the rate was 6.33 percent in November 2005.

NAR President Pat Vredevoogd Combs, from Grand Rapids, Mich., and vice president of Coldwell Banker-AJS-Schmidt, said the performance of long-term interest rates is a pleasant surprise. “Mortgage interest rates are the lowest they’ve been since January, and it’s the first time since August of 2005 that interest rates are lower than a year earlier,” said Combs. “This is increasing buying power at the same time that sellers are showing a willingness to negotiate price and terms. Combined with a plentiful supply of homes on the market, there’s a window for buyers now with conditions that we haven’t seen prior to the beginning of the housing boom in 2001.”

Single-family home sales increased 0.2 percent to a seasonally adjusted annual rate of 5.52 million in November from a pace of 5.51 million in October, but were 10.2 percent lower than the 6.15 million-unit level in November 2005. The median existing single-family home price was $217,200 in November, which is 3.6 percent lower than a year ago.

Existing condominium and cooperative housing sales rose 3.1 percent to a seasonally adjusted annual rate of 757,000 units in November from a downwardly revised 734,000 in October, but were 13.6 percent below the 876,000-unit pace in November 2005. The median existing condo price3 was $224,600 in November, which is unchanged from a year ago.

Regionally, existing-home sales in the Northeast increased 6.0 percent to a level of 1.06 million in November, but were 4.5 percent below November 2005. The median existing-home price in the Northeast was $269,000, down 2.2 percent from a year earlier.

Existing-home sales in the West rose 0.8 percent to an annual pace of 1.32 million in November but were 17.5 percent lower than a year earlier. The median price in the West was $351,000, down 0.8 percent from November 2005.

Existing-home sales in the Midwest were unchanged in November, holding at a level of 1.42 million, and were 9.6 percent lower than November 2005. The median price in the Midwest was $165,000, which is 3.5 percent below a year ago.

Existing-home sales in the South fell 1.6 percent to an annual sales rate of 2.47 million in November, and were 10.2 percent below a year ago. The median price in the South was $179,000, down 3.2 percent from November 2005.

Most coveted real estate today is a few feet of Pasadena sidewalk

By this afternoon, plumber Chad Pawlowski will be on his 48th hour of family tradition, having landed a choice Pasadena curb Saturday for three generations to camp out for the Rose Parade, then head to the Rose Bowl.

The Pawlowski clan is not only watching the parade and volunteering to help bring it off, this year one of them, 16-year-old nephew Brian Anderson of Whittier, will be marching and playing trumpet in the parade. "We're embedded in this parade," Pawlowski said.

Outside the Bentley dealership on Colorado Boulevard, the family was among many that had set up a sidewalk campsite, with barbecues, hot dogs, cocoa and Sunday breakfast fare spread out on tables.

There, near the corner of St. John Avenue, the Pawlowskis, the Andersons and numerous clans played out their yearly custom of spending the night on concrete to score the perfect parade viewing spot.

"It's tradition. We've been coming since our parents dropped us off at 6 a.m. the morning of the parade in the Ford Country Squire, and we [kids] held the spot," said Susan Anderson, 40, a special education teacher from Kingman, Ariz.

She grew up in Alhambra with two sisters and brother Chad, who had scored the parade perch and marked it in chalk Saturday about 3 p.m., then had to bird dog it with hours of pacing, until he finally repaired at 3 a.m. to his car a block away. Three hours later he returned to baby-sit the family's 150 square feet of street camp, and his mother, children, spouse and other kin streamed in by 4 p.m. Sunday.

Just down the sidewalk, Mike Portaro of Lompoc banged out his own seventh annual tradition on a full set of drums, having found a patch of private property on which to serenade smiling parade campers with "This Is for All the Lonely People," by America.

"I want to wish you all a very happy New Year," said "Mike the Lone Drummer," as he announced himself to passersby, some of whom gunned their Harleys and drowned him out, while others honked and cheered.

About a mile away, two families moved through their own parade traditions after parking on a residential street off Orange Grove Avenue. They tucked volunteers' parking permits onto their dashboards and, like they have for several years running, they piled into one car about 1:30 p.m. to head to a Duarte barn to ride back in their assigned float vehicles as they are towed to Pasadena.

Cary Westcott, a 51-year-old train conductor for Union Pacific Railroad, will be the lookout on the Kaiser Permanente float this morning. He said he has enjoyed 13 years of being a part of something "that everybody involved has fun with."

His 18-year-old son, Cody, will drive the city of Palmdale float. From the time he was 12, he rode the floats with his dad. "How many 12-year-olds are stowed away on the floats?" Cody Westcott said.

Union Pacific locomotive engineer John Strube, 53, will be controlling the Kaiser float, relying on the senior Westcott's directions of "Left! Left! Stop! Stop!"

They've been volunteering for years for a firm that builds floats for cities and businesses.

Throughout Pasadena, a festive mood prevailed Sunday as motorists and pedestrians took the snarled traffic in stride. Pasadena Police Lt. Jari Faulker said there had been no arrests or significant problems Sunday.

Outside the Rose Bowl, Debbie Platte, 51, of Rialto was practicing her own tradition of 13 years, among the people streaming by the Honda dragon float and others in the yearly pre-parade viewing area. After the floats, Platte, her husband and friends dine out. Today, they'll watch the parade on television.

The tradition started as a way to distract Platte from a breast cancer diagnosis, she said. "Now it's just what we do each year."

Real estate to sustain growth in 2007

A study conducted by Assocham said that the booming real estate market will gain momentum and is all set to attract foreign investment worth Rs 80 billion in 2007.

`The real estate boom of 2006 is set to multiply itself in 2007 to get India a foreign capital of over Rs 80 billion with leading international investors establishing their presence in the rewarding real estate development.

The chamber attributed factors such as strong economic growth, rising income levels, growing middle class, increasing urbanization and improving transparency for the resurgence in the real estate sector in 2006.

The realty sector would grow from USD 12 billion in 2005 to USD 90 billion by 2015, said Assocham.

In a bid to encash the booming Indian property market, global players such as Royal Indian Raj International, Blackstone, Goldman Sachs, Emmar Properties, Pegasus Realty, Citigroup Property, Lee Kim Tah Holdings, Salim group, Morgan Stanley and GE Commercial Finance are expected to bring substantial foreign capital into India.

Giving details about the foreign capital that is expected to come into the realty sector, Assocham said US-based investment bank Morgan Stanley has invested Rs 3 billion in the Bangalore-based Mantri Developers and plans to invest more than one billion dollars over the next 5 years.

Around 25 million non resident Indians (NRIs) are investing in immovable property in India, but unlike HNIs and financial institutions they are keen to invest in the housing segment, rather than commercial projects.

Global biggies such as Morgan Stanley, Lehman Brothers, HSBC and ABN Amro have queued up to pick up stake in local realty firms, it added.

Top 5 Emerging Real Estate Markets For 2006

Successful real estate investors are well aware that one of the fundamental keys to building a successful property portfolio is the careful timing of market entry; therefore investors always seek to buy ahead of an emerging trend and often take a national or international perspective when looking for the next big thing in terms of real estate.

In 2006 there are five countries that stand head and shoulders above all other nations worldwide in terms of the potential their real estate markets present property investors.

This article offers you an overview of each country so that you can choose where to make your next real estate purchase.

Costa Rica – The CIA World FactBook has recently begun listing Costa Rica as “a Central American success story” because the Costa Rican government have successfully established an economically and politically stable country in which more overseas investors are focusing their financial interests.

The retiree and second home markets in Costa Rica are growing as is tourism interest and the country offers visitors and expatriates a stunning climate, an abundance of rare and beautiful flora and fauna, it is bordered by both the Caribbean Sea and the Pacific Ocean and the standard of living is both high and affordable.

The real estate sector in Costa Rica offers investors an affordable platform and the Costa Rican government offer investors certain tax breaks and incentives to commit to the country.

Ghana – Located in West Africa Ghana is a stunningly beautiful country with palm fringed, white sandy beaches and an incredibly forward thinking and progressive government.

The government of Ghana are committed to improving the economic conditions in Ghana and are targeting foreign direct investment and making significant constitutional changes to allow for freer flowing investment which will in turn attract greater overseas economic interest.

The country has a growing tourism sector which requires accommodation units to let out to visitors offering a real estate investor an immediate opportunity for rental yield. And the long term economic prospects for Ghana are positive which should give a property purchaser long term capital growth prospects from any investment made.

Malaysia – Economically speaking Malaysia is built on very solid foundations and is benefiting from closer export ties to China, low inflation, a small external debt and good foreign exchange reserves.

The country also has a growing tourism sector and a vibrant city based young executive market - either of which a property investor could target for rental income. Real estate in Malaysia is affordable and economic indicators suggest that property prices will continue to rise steadily over the medium to long term giving an investor the chance to reap capital growth from any investment made as well.

Qatar – Forget Dubai for she’s a blown rose! The next big Middle Eastern real estate marketplace is Qatar where constitutional changes have been effected to allow for foreign freehold ownership of property in certain key geographic areas and where overseas investment is flooding in.

The Qatari government are actively targeting foreign investment into all business sectors and establishing an oil-independent economy that should be forever sustainable. The property sector is entirely secondary to the government’s focus, therefore an investor can rest assured that demand for real estate in Qatar will remain strong as the majority of buyers are purchasing for long term accommodation not purely for investment gain.

Turkey – In 2005 Turkey finally began the process for EU accession and immediately received substantial investment commitment from Dubai. The real estate market is already doing very well in Turkey especially in Istanbul and along the Turkish Rivera, but this investment boost will help to raise infrastructure standards in Turkey and has also already boosted worldwide interest in this vast and impressive country.

Real estate investors buying today will benefit from a growing tourism market, increased foreign direct investment as Turkey moves towards EU membership and also a property market that is currently under priced and that has massive room for price expansion.

Hopefully these hot tips will give you some food for thought and assist you with your next real estate property portfolio purchase.