STARS ALIGN FOR BUYERS

Interest rates below 5% & prices bottoming out in the 1ST half of the year will drive 2 of the 3 main ingredients for buyer affordability to cyclic lows next year, Freddie Mac's chief economist said yesterday. "Buyer affordability is at the highest level in decades," said Freddie's Frank Nothaft. "With affordability high, many 1ST-time buyers will be attracted to the housing market in the new year, likely translating into more home sales in 2011 than in 2010." Though they will rise above their present level, he expects rates on 30-year fixed-rate loans to remain below 5% throughout the year. As for home prices, price indexes for the U.S. as a whole are likely close to bottoming out. The National Association of Realtors' Affordability Index for the 1/3 quarter reported one of the most affordable buying markets since the inception of the index in 1971, he noted.

Complete Article

2011 HOUSING TRENDS

McMansions are out; compact housing is in: The era of the McMansion is over, according to the 2011 edition of "Emerging Trends in Real Estate," co-published by PricewaterhouseCoopers and the Urban Land Institute. Not only are baby boomers downsizing to more manageable homes, but 1st-time buyers are also entering the market with extremely different tastes than their parents. The younger generation of homebuyers, born between 1977 and 1994, are interested in smaller homes in vibrant, compact, walkable neighborhoods. As baby boomers move into smaller homes, who will they sell their large, suburban homes to?

Homebuyers are thinking long-term: In the past, many homeowners thought of their houses as "credit cards" to borrow money against -- a mindset that caused many of the financial problems. While most Americans still think buying a home is a smart financial move, they also realize that a house is more than an investment. Instead, today's buyers are looking for a home, a place to provide shelter and security for a family. As a result, homeowners are planning on stay in their dwellings longer; 1st -time homebuyers want to own their homes for a decade, while repeat buyers want to own theirs for 15 years.

More foreclosures to come: Foreclosure processing was delayed this fall by the "robo-signing scandal" raising concerns that many homeowners may have been unfairly evicted. Though the controversy caused a dip in foreclosures in October, it won't cause a huge drop-off in the number of distressed properties entering the market, says Rick Sharga, senior vice president of RealtyTrac. At the rate the banks are going, it will likely take several more years to work through the millions of delinquent mortgages. But on the bright side, if banks continue to foreclose homes gradually, home prices are likely to stay stable.

Mortgage rates remain low: It's not too late to take advantage of low mortgage rates. While rates are expected to rise slightly in 2011, they will likely remain low, even under 5

Housing recovery contingent on jobs: Above all, a healthy workforce is key to housing recovery. While the unemployment rate remains high, current homeowners will continue to lose their homes to foreclosure, and potential homebuyers will find it difficult to qualify for loans. According to the National Association for Business Economics, unemployment will stay above 9 percent in 2011, which could hold back a housing recovery next year.

HGTV Frontdoor Article

HOUSING SHORTAGE COMING IN 2011?

The focus of the U.S. real-estate market lately has been the number of foreclosures and people trying to purchase cheap housing. But Brian Wesbury, chief economist at First Trust Advisors, says that if Americans don't start focusing on building new houses, the market will have a much bigger problem on its hands. "We need one and a half million houses per year just to keep up with population growth," Wesbury said in an interview with Steve Forbes. "And then if you throw in, you know, fires and tear-downs and just worn-out properties, we need 1.6 million or more per year. Right now, we're down to about 6 & 1/2, 7 months' inventory whether you look at new homes or existing homes."

By: Alexandra Zendrian of Forbes

Complete Article

North American International Auto Show

One of the premier international auto shows in the world!


Held at Cobo Center.


Public Show is when all of us get to check out the cars.
January 14

Charity Preview Gala

                                                  January 15-23

                                                  Public Show
                                                  http://www.naias.com/

Public Show

TIME TO INVEST IN SOUTHEARN MICHIGAN!

The Michigan economy is not out of the water just yet, but there are some very encouraging signs indicating that things may be turning the corner.

1. Detroit's Automakers Are All Producing Profits It is no secret that Michigan's economy is heavily tied to the automotive industry. In recent years, the automakers have struggled tremendously, but the restructuring is starting to take hold. In the 2nd quarter of 2010 all three of Detroit's automakers were in the black posting the following profits: Ford - $2.6 Billion - General Motors $1.3 Billion -Chrysler - $183 Million

This is welcomed news for the Michigan job market as these profits have already resulted in renewed investments into Michigan's economy. These investments are expected to create approximately 63,000 jobs.

2. The State of Michigan Has Provided a 42% Tax Credit to Film Makers In April 2008, the state of Michigan announced a 42% tax credit for film makers that produce films using Michigan workers. This has spurred a flurry of film making activity. Before the incentive, Michigan averaged five film productions annually. In 2008 -31 films were produced, and in 2009- 35 films were produced. This trend is expected to continue with the announcement of 3 major studios to be built in Pontiac, Detroit, and Grand Rapids. These studios alone are expected to bring 6500 permanent jobs to Michigan.

3. Investment in Renewable Wind Energy Because of Michigan's vast coastlines along the great lakes, the wind potential is phenomenal. Michigan has enacted the Renewable Portfolio Standard which requires 10% of the state's energy demand to come from renewable resources by 2015. This standard is sure to drive investment into renewable energy resources in Michigan.

2011 REAL ESTATE PREDICTIONS

Freddie Mac analysts point to five features that they believe will likely characterize the 2011 housing and mortgage markets:


1. Low mortgage rates. With Fed observers expecting the central bank to keep the federal funds rate at its current target range of 0 percent to 0.25 percent for most (or all) of 2011, relatively low mortgage rates will be a feature of the 2011 mortgage market.

2. Prices have hit bottom. House prices are likely to begin a gradual, but sustained recovery in the second half of 2011.

3. Housing will remain affordable. With affordability high, many first-time buyers will be attracted to the housing market in the New Year, likely translating into more home sales in 2011 than in 2010.

4. Refinances will dwindle. Many eligible borrowers have already refinanced and the federal Making Home Affordable refinance program is expiring on June 30. While fixed-rate loans are likely to remain low, they will move up gradually, making it even less likely that refinances will be attractive to most home owners.

5. Delinquency rates will decline. Based on the last several business cycles, the share of loans that are 90 or more days delinquent or in foreclosure proceedings - known as the "seriously delinquent rate" - generally crests within a year of the start of the recovery in payroll employment, and this economic recovery appears to fit within that pattern. Payrolls began to rise last January, and by the spring the seriously delinquent rate had begun to fall.

Source: Freddie Mac (12/09/2010)

WHAT IS THE "CONSUMER CONFIDENCE INDEX"?

The Consumer Confidence Index (CCI) is a monthly release from the Conference Board, a non-profit business group that is highly regarded by investors and the Federal Reserve. CCI is a unique indicator, formed from survey results of more than 5,000 households and designed to gauge the relative financial health, spending power and confidence of the average consumer.

There are three separate headline figures: one for how people feel currently (Index of Consumer Sentiment), one for how they feel the general economy is going (Current Economic Conditions), and the third for how they see things in six months' time (Index of Consumer Expectations).

SHARING & CARING

This time of year, many of us are able to sit around an abundant Thanksgiving table counting our blessings, indulge in wonderful holiday gifts or travel to see family and friends. Many are not so fortunate. Included are a few of the noteworthy and deserving organizations in the greater southeastern Michigan area that strive to help out those in need. If you can - give of yourself, your time or money, or lend a helping hand to someone in need.



TOP 9 GREEN HOME IMPROVEMENTS

Take some time to get your home ready for fall now and you won’t be caught unprepared when the temperatures begin to cool. Here are the top 9 GREEN Home improvements based on cost & return on investment according to HomeGain.com
1. Plant native trees & plants
2. Replace air filters
3. Green home staging
4. Weather strip, caulk doors and windows
5. Install programmable thermostats
6. Install low flow shower heads
7. Use auto turn-off power strips
8. Install CFL or LED lights
9. Paint with low VOC paints

Tony Robbins Offers Tip on How to Weather the Economic Storm

Tony Robbins, who has worked as a personal adviser to some of the world's top financial leaders, encourages people to be smart about the financial decisions they make in the coming months and years. "This is a season called winter and it doesn't last forever. Winter's followed by spring. There will be another great set of opportunities," says Robbins. "It'll probably take longer than we want, but if you're smart and don't let things stop you, you can see where these opportunities are."
The Huffinton Post has included his video on this subject and is truely work watching: Tony Robbins Video http://www.huffingtonpost.com/2010/08/11/how-to-weather-the-econom_n_677769.html

MICHIGAN'S ECONOMY CONTINUES TO GROW-SLOWLY

In an article from Crain's Detroit Business, Shawn Wright discusses some postive news for Southeast Michigan's economy. At its lowest point in January, the PMI (Purchasing Managers Index) showed a 45.2. Over the last six months, the index has indicated a consistently expanding economy to July's level of 56.7. As we see sustained growth in the economy, purchasing managers should become more comfortable with hiring once again. And, as people feel more confident in their job security, the economy, and housing prices, we should see some leveling off of the real estate market.

For Shawn's complete article, click here

Lani's July 2010 Real Estate Update

Optimism – “a disposition or tendency to look on the more favorable side of events or conditions and to expect the most favorable outcome"  As the economy recovers, so does the real estate market, buyer optimism and our biggest investment – our homes. This month’s News You Can Use! newsletter contains articles about a glass half full!  To view the newsletter, click on: http://www.lanisussman.com/

To Subscribe to Lani's Monthly Newsletter: respond to lani@maxbroock.com

STAY COOL THIS SUMMER & REDUCE YOUR ENERGY BILL

1. Invest in Ceiling Fans: Ceiling fans help cool you down because they move the air. When moving air meets moisture (like the sweat on your skin) it has a cooling affect that can make you feel 8 to 10 degrees cooler.
2. Use Outdoor Misters: Have a cooling affect that can make you feel 8 to 10 degrees cooler. A mister sends a fine spray of water into the air which slowly evaporates by absorbing energy from the air. The net result is a cooler air temperature in the immediate vicinity of the mister.
3. Give Your Air Conditioner a Check-up. The contractor will clean the coils, make sure you have enough refrigerant, and generally see to it that the system works as well as possible. You should also replace or clean the unit's filters as often as required.
4. Energy Efficient Light Bulbs –Fluorescent light bulbs not only use less energy, & last up to 5 years longer, they don’t emit as much heat as regular incandescent bulbs. In fact incandescent bulbs waste 90% of their energy on the heat rather than on lighting!

BRAVE NEW REAL ESTATE WORLD!!!

The housing market has emerged in a brave new world on the bust side of the boom. Distressed properties litter the market. Tighter underwriting rules apply. Regulations are stronger. Cash talks. Fast appreciation isn't guaranteed. But buying is still possible if you understand what's changed.

You need money on the table. Don't leverage yourself to the hilt. The larger the down payment, the better. A sizable down payment gives you an immediate equity stake in your home and a better shot at landing a loan for less.

Credit is tight. In the past, almost everyone was able to get a loan. Today you'll need a credit score in the high 700s, prove your income, assets and demonstrate you can make mortgage payments.

Home ownership isn't a right It's a responsibility. Today's housing market is littered with homes purchased by buyers who moved to fast and later discovered they could not afford interest rate resets or the mortgage once the economy tumbled and layoffs reduced or erased income.

Smaller is better. The era of energy- and money-gobbling McMansions is over. Smaller homes are less expensive to own, to operate, to maintain and easier to sell. Using less energy, they are also greener. Who needs all that space anyway?

Fast appreciation isn't guaranteed. Buying a home can be a good deal with prices down as much as 50%. Buy because you can afford a home. Don't buy because you expect appreciation to make you rich.
By: by Broderick Perkins of Realty Times - June 10 ,2010 Complete Article

THE RECOVERY ACT & MICHIGAN

Here is what a recent government report has to say about what the Recovery Act has done for Michigan.

$1.35 billion to develop and build advanced batteries

$243 million to weatherize 40,000 homes

$650 million in SBA loans to small businesses, tax credits leveraging

$750 million in private investment for clean energy manufacturing:

The Recovery Act is changing Michigan's economic landscape. In the 18 months since the Recovery Act became law, Michigan has used these federal funds to create or retain more than 54,000 jobs. Thanks to the Recovery Act, people are building roads, improving water systems, educating our children and making our homes and public buildings more energy efficient.

http://www.michigan.gov/recovery

MICHIGAN AT THE HALFWAY MARK ON PATH TO REVIVAL

Tom Walsh of the Free Press offers this perspective on Michigan’s recovery.

Halfway to revival, halfway to cheating death, to dodging a label as America's first third-world state. The glass is half full.

While challenges certainly do remain, the good news is that we have cleared two big hurdles on the four-step path to economic self-realization:•

We know now that Big Companies can't support everyone in perpetuity. We've seen that at General Motors, Delphi, Visteon, DaimlerChrysler. Remember Comerica, Burroughs, Unisys, National Bank of Detroit?•

We know Big Labor can't protect everyone either. Just look at the shrunken payrolls of GM, Ford and Chrysler; the reduced wages at American Axle; the extinction of the Electrolux appliance plant in Greenville.

Now we're at Step 3 on the path to self-realization, dealing with the belief that Big Government can ride to the rescue. Government can and should provide aid in emergencies, it must not become a crutch used to prop up an otherwise uncompetitive economy. That's where we are in Michigan now, wrestling with how to wean ourselves off reliance on government largess. We're still plugging the state budget with federal stimulus money. Detroit relies on federal cash to knock down blighted housing.

The last hurdleIf the state can survive that struggle, all that remains will be Step 4 in self-realization: The only ones who can save us are Ourselves.

Complete Article

SHOULD YOU MOVE UP?

There is an endless supply of reasons why a family may need to move up to a bigger, or nicer, home. How do you know, though, that now is a good time to move up?
Housing Prices. The price of homes makes it the best time to purchase in 40 years.

Interest Rates. There is a huge difference between buying a home at 5 percent interest (June 2010), and buying one at 13 % interest (February 1983). The available rates can change from week to week, and how you qualify depends largely on your credit rating.

Income. Moving up to a bigger or nicer house will may mean a bigger mortgage payment. Take an honest look at your budget to see if this makes sense for your family.

Equity. This is one way to avoid a bigger mortgage payment. Make a large down payment.Wish list. Take a moment to consider what area of town would be best for your family. Think about schools, commute times, neighborhood amenities and affordability.

MOODY'S IS BEARISH ON HOUSING RECOVERY

Moody's Investors Service threw cold water on optimistic projections of a V-shaped recovery in the battered U.S. housing market, predicting it could take more than 10 years to get back to boom-level prices. "For many reasons, the rebound will be disproportionately small compared to the decline," Moody's said this week in its latest outlook on the residential market. "It will take more than a decade to completely recover from the 40% peak-to-trough decline in national home prices."

The housing market is in the third year of the current downturn, one of the worst corrections in U.S. history as a result of the economic recession and the mortgage industry nearly grinding to a halt during the credit crunch.

"The bursting of the housing bubble precipitated a crisis in financial markets the likes of which have not been seen since the Great Depression and plummeted the nation into recession," Moody's said.

"The scars that this downturn will leave on the economy and the housing market will be long lasting and persist in nearly all facets of the housing industry, including the demand for homes, ownership patterns, homebuilding, and house price appreciation," the analysts forecast.
"It will take more than a decade for many measures of housing activity to regain ground that has been lost as a result of the correction: The intense downturn will overcorrect for the excesses in the housing market generated by the boom years," they added.
Complete article at: Moody's is Bearish

4 Real Estate Ownership Myths

“Owning a Home is a Solid Investment”

The recent challenging market has proven the problem with this statement. You can lose money investing in property whether it is for your personal residence or investment property.

Real estate ownership is can be considered “good debt” especially if you have paid down your mortgage and despite the declining market, have equity in your property. But, as many people have learned when selling their homes, the loss in market value of a home can reduce your “investment” significantly. Conversely, during an “up” market many see large increases in value.

For most people, a real estate investment is considered a “long term” investment even if they don’t intend on living in a home for an extended period.

“Distressed Properties Mean Big Profit”

You may buy at a great price, but after adding in the cost of buying, selling, property taxes, and renovation costs (especially the undiscovered problems that crop up) your return on investment is considerably less than you had anticipated.

Added to these concerns, living through a “renovation” requires a high tolerance for chaos, stress, and unusable areas of the house. Or if it is empty during renovation, you incur the cost of the mortgage, taxes, utilities, and landscape chores etc. subtracting from your rate of return.

“You Make All the Decisions”

Of course, you decide when to buy, where and how to pay. You decide how to decorate, upgrade, and landscape. What you have no control over is the condition of the neighborhood or how it changes. Foreclosures, zoning changes, governmental regulations, association rules, negligent neighbors . . . all effect the value of your home.

“You Can Sell When You Choose”

You are personally invested in your property and it is not an easily liquidated interest. You could be stuck in a bad situation longer than you are comfortable with if you find your neighbor is a drug dealer, has the dogs from hell, fixes cars in their spare time, parties heavily on the weekends or just hates you.

Has the Economy Bottomed Out?

Has the economy hit bottom? I think so but check out this article...http://ping.fm/azAwp