The first thing that came to my mind was Steve Martin in The Jerk.
The new phone books are here!
The new phone books are here!
Category Archives: investment
The New Tax Credits are Here…
- Tuesday, 10 November 2009 00:59
- Written by Lane Bailey
- 0 Comments
One step away from Tax Credit Extension…
- Thursday, 05 November 2009 18:06
- Written by Lane Bailey
- 2 Comments
Today the House passed the Unemployment Extension Bill by a vote of 403-12. Yesterday the Senate Bill passed 98-0. I think it is a slam dunk that the President will sign this legislation in the near future.
The new version of the Homebuyer’s Tax Credit still has the $8000 for First Time Homebuyers, as the version expiring November 30th had. It also allows $6500 for “move-up” buyers, provided they have been in their home more than 5 years. There is an income cap of $125,000 for individuals and $225,000 for couples. Also, there is a price cap of $800,000 for the purchased home.
Back from Vacation… and the Time Share Shuffle
- Monday, 12 October 2009 22:53
- Written by Lane Bailey
- 0 Comments
- Image by Thomas Hawk via Flickr
The family took a quick trip to the Smokies over the last few days… We had a great time, thanks. While we were there, we agreed to go to a Time Share Sales Presentation Tour. Hey, $100 is $100… and the other inducements (I’ll report about them in the future…).
I’m not going to be specific about the name of the time share company… in fact I am going to be quite vague… but the points I am going to mention should apply across the board.
The new “Time Share” is actually quite different from the old “Pick a Week” concept that many think of with time shares. Now you get to buy points. The points can be exchanged for a variety of vacation options. Maybe you could spend 10 days in Orlando… maybe a couple of days in Gatlinburg and a few days in Branson. Or… a cruise… all without regard to which week you have and trying to find someone else that wants that particular week in your particular resort.
We were first introduced to the system by the Disney Vacation Club. We have never purchased a DVC membership, but we have stayed in a DVC resort using points rented from a member. Personally, I think it is a pretty cool system for vacation planning…
But… there is always a “but”…
While the DVC has a very strong ROFR (Right of First Refusal) which functions to keep resale prices stable, other time share companies do not. What this means is that the price you can sell your timeshare for can be quite an ugly shocker…
Last I looked, new DVC points were about $100ea. Resale points were about $80ea. in the same resort (same time frame).
On this trip (not to Disney), we were offered a package for $60,000 and another package for $30,000. Tonight on Ebay I watched two sales from the same company go off… The $60,000 package sold for $2025 (there was an additional $1904 in fees and closing costs). The $30,000 package sold for $860 (add an additional $524).
In the interest of fairness, there are a couple of perks that come with buying from the developer… I can’t really detail them without giving away the name of the company… but I don’t see them worth 10x the cost.
And there is another thing… the “Secondary Offer”
After we said “no” a few times and they were pretty sure that we weren’t buying, we were sent down for an exit poll. The pollster asked a few questions and then pitched the last ditch offer. Honestly, we might have done it if the kids weren’t climbing the walls… but we didn’t. After looking and researching, I would still say that the LDO (last ditch offer) wasn’t that bad. It wouldn’t have been a money loser…
But, I’m glad we didn’t. If we were to decide to buy the time share, which is a thought, we would be buying resale. And we would be spending about the same amount of money to buy the time share as to rent the points… Of course, if we bought it we would have to pay the monthly maintenance fees…
****Just as a disclaimer… I am a licensed real estate agent, but I do not sell time shares (new, resale, whatever). In this case, I’m just a guy that went to one of the presentations tours.****
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First Time Home Buyers… I just found a REAL bargain…
- Saturday, 26 September 2009 23:47
- Written by Lane Bailey
- 0 Comments
- Image by mlhradio via Flickr
The October issue of Realtor Magazine (our industry magazine) had an interesting article about dispelling myths while educating first time home buyers. The third point was about the realities of “bargains”.
There are absolutely some bargains in the market… But, often those properties that are the real bargains are NOT the ones that have rock-bottom prices.
The HECK you say…
Really… I have been in some pretty cheap properties in the last few months. It seems that a house priced at $25,000 in a neighborhood or $150,000 homes would be a slam-dunk, right? That deal starts to look WAY less attractive when the issues get added up…
- roof
- mold
- floor coverings
- appliances
- plumbing fixtures
- electical fixtures
- copper wire
- copper plumbing
- landscaping (not to make it pretty, but to stop water from washing away the foundation)
- HVAC
- driveway paving
Seriously, I looked at a house that needed all of that. It would be faster, easier and probably cheaper to bulldoze the house and start over. Since the lot would be worth about $10,000… and it would take about $15,000 to clear the lot and get it ready for a new building… This wasn’t a deal.
Of course, most aren’t that severe…
However, there are a lot of times where one house will be significantly cheaper than another for sale, but after correcting its issues, it actually ends up costing more. It might be simple things like carpet and appliances, or maybe something more involved, like a roof or HVAC.
This often ties back to “I need to see all of the options“, presented earlier. In this case, we just want to get a look to make sure that it really is in that bad of shape.
I have looked at a lot of “bargain” properties and have a pretty good feel for them. There are some great deals, but they are usually not the first ones to present themselves… They are generally in much better shape and slightly more expensive.
Finally…
Remember that the deal properties often still need work. And it is probable that the buyer will have to come up with cash for that work, in addition to downpayment and other closing costs… it isn’t something to bootstrap.
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First Time Home Buyers… I need to see all of the options
- Friday, 25 September 2009 23:42
- Written by Lane Bailey
- 0 Comments
- Image by Getty Images via Daylife
The October issue of Realtor Magazine (our industry magazine) had an interesting article about dispelling myths while educating first time home buyers. The second point was about excessive caution, and buyer, especially new buyers, wanting to see “everything on the market”.
I have to admit… the writer at Realtor Magazine got another solid base hit. I have worked with buyers that wanted to see a LOT of houses… even houses that really didn’t suit their purposes… even houses that they KNEW didn’t suit their purposes prior to wanting to see them. And there are a LOT of houses on the market.
While inventories are down around 25% from last year, there are still about 80,000 homes on the market in the Atlanta Metro area. Generally, in ANY given price range and area there are scores of homes. Even Lilburn, GA has several dozen homes priced under $150,000. And by the time a buyer makes his or her way through all of them, there are new ones to see. It just isn’t practical. Tighten the search criteria…
It isn’t just a matter of spending a lot of time looking at houses… it is losing out on houses because of spending time looking at other houses… It goes like this… A buyer goes out and looks at 5-10 properties. They find a couple that they like and one that they REALLY like. Instead of deciding to write an offer, they feel that there is time to look (after all, the market is weak, right?). So, they schedule more time to look at homes. In the mean time, the home that they REALLY liked goes under contract to another buyer. When they have looked at more homes and decide that the home that they REALLY liked is the one that they want to buy… that home is no longer available.
We call it analysis paralysis. Another type of analysis paralysis comes after the buyer decides to write an offer. They spend days and days trying to figure out what to offer. While they are doing that, another buyer puts the house under contract.
Don’t get me wrong… these are important decisions. Buying a home is a BIG deal… ESPECIALLY for first time home buyers. You want the right home and you want it at the right price. I understand. But, I also don’t want you to regret a lack of action. Right now, if you see the right home, be ready to make the offer. We’ll check the comps and craft the offer… but YOU need to be ready.
Being ready means getting prequalified with a lender. Getting ready means knowing how much money you’ll have available to close. Being ready means knowing that you have the down payment. Being ready means being prepared to break a lease or being out of the lease in an appropriate time frame.
But, being ready may mean getting the right house at a great price.
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