Let's Make Money!

Here we are in the midst of Catch 22! Google the movie of the same name if you aren't familiar with this conundrum. Having never worked for Uncle Sam I never dreamt of ever having to deal with it firsthand.

The financial melee' which seems to have numbed our collective brains has had an effect that may be good for us in the long term. But for now it is frustrating us as consumers, driving my fellow Realtors batty and be assured many lenders are pulling their hair out as well.

Okay here's something that I need to practice more of and so do you - patience. We are slowly moving in the right direction. Remember these are monstrous adjustments that are being made and they certainly shouldn't be made in haste.

As an agent, appraiser and homeowner (who is selling one property at present) I've found the process has gone from, "we needed it yesterday", to an unnerving, "you may get it in three months".

My recommendation to all is to shop judiciously for your loans! I've always encouraged my clients to have relationships with local bankers and that is more important than ever. And don't forget, don't put all your eggs in one basket either. That's right be sure to shop around, ask questions and don't be afraid to be a pest if you want to close a loan quickly.

This is a superb opportunity for everyone to grab a piece of the "American Dream" through purchasing real estate. Guard your credit rating closely, be realistic in your desires (what can I really afford) and start looking now as the process has become longer.

Real estate is a great investment and especially now while prices have leveled out and rates have fallen. Remember this is a long-term return process not a get-rich-quick scheme!

Jim Quist is a real estate agent, appraiser and consultant in Lexington, Virginia. He owns Quist Appraisals, work with Colonna and Associates and in addition to this blog has a monthly radio show covering real estate issues.

Politics. That could very well have been the middle name of both my sister and I.

We've gone back and forth, voted for both parties but most importantly voted for the person we felt would best represent the needs of our country.

I'm not really sure where we found our passion however I have a sneaking suspicion we can blame it on our parents who have always been "involved" with the community. Perhaps I could point a finger at my mother's brothers (that would be uncles) who had a penchant for sitting around their mother's coal fired potbellied stove and argue endlessly about just about anything. If there were ever a lull in the action the eldest brother would stir the stew and off they went again. Quite amusing looking back on it all now.

My sister and I recently lost both my mother and father. This is what prompts me to write this blog.

I sat the other evening in my parents house and watched the presidential debate. I found the memories of my parents sitting in their chairs more interesting than the second "town hall" debate. Nice thing about how your mom and dad can instill so many virtues, create so many wonderful memories and even though they have passed on they are and will always be right there with you.

Among those memories were detailed conversations with my father about The Great Depression, World War II, Korea, Vietnam, Civil Rights, landing on the moon and so, so many events that shaped both his life and mine.

Even at 87 he was pretty adamant about how he felt about Republicans. More in general than specific with the exception of our current president. I was always quite stunned at how anti-Bush he was but as the ruinous economic practices of this administration have come home to roost I became less forgiving as well.

As my father began to find it harder and harder to get around and be involved with others I asked his opinion of John McCain. Not overly impressed was he however more importantly he pointed out how he could track his decline both physically and mentally over the years and wondered how McCain would ever be able to handle the stress of such a rigorous position. This led to a further discussion of the torment at the hands of his captors and how that surely had aged him beyond his years.

I think my father found it incredulous that a person as lacking in experience as Sarah Palin could be so close to being the leader of this country. As it became increasingly obvious that Governor Palin's choice as a running mate was a grab for straws we began dissecting the Obama-Biden ticket.

You'll note that there were certainly things on the Democratic of the aisle that he wasn't thrilled with either.

I'm very proud of my father's accomplishments over the years. Surviving one of the toughest economic downturns in our country's history, volunteering to fight in WWII and Korea and teaching his children as best he could about being fair and treating others as  you would expect to be treated. He was a member of, as Tom Brokaw says, "America's Greatest Generation".

Though he taught me to be accepting of others he still had some of his generations views and though he never told me directly I suspect he found it difficult to envision a black man as president. Not surprising.

Would I have thought the same when I began my academic career in an integrated school? Probably not as it was first grade and I was not saddled with the prejudices that constrain so many of us in one area or another. We were told we could do anything.  I thank God for that blessing to this day.  It has helped me to see life from the viewpoint of others and respect them. It has made my life far more rewarding, entertaining, informed and fulfilling.

Despite his uncertainty about the change of our collective mind-sets that having a black man as president may bring he was a solid judge of character and felt the Obama-Biden ticket would be best for this country. That choice spoke volumes to me and would have to those who knew him.

After watching almost two years of campaigning, participating in a weekly radio talk-show focusing on politics and most importantly speaking with my dad I believe that our country needs the "stirring of the stew", the dialogue, the change that most assuredly will come with President Barack Obama and Vice President Joe Biden.

On November 4, 2008 I encourage you to vote Obama-Biden. I firmly believe both my parents (82 & 87) would have asked the same.

Here's the clincher with uncertain economic times. We choke, we freeze and out of fear delay making important decisions.

Let us take purchasing a new home as a perfect example. The market in which I work has a superb inventory, the prices have hit as close to bottom as they will get and yes, contrary to what you've heard there is plenty of money to be lent at low interest rates. Now lets add the change in mood once we've elected a new president into this equation.

Historically the economy takes a leap (often of faith) when we decide who will occupy the White House in January. This means that everyone who has been holding back on making an important economic decision, i.e., purchasing a home, will begin flooding the market.

Prices will suddenly become very competitive (though I doubt they will rise as quickly as before) and that house that was priced at $250,000 (a steal I must say) will suddenly increase or be gobbled up by a smart (and quicker) buyer.

Where does that leave you? Driving by that same house in twenty years telling your grandchildren, with regret in your voice that you could have bought that house for next to nothing.

So if you were to ask me when the best time to buy a house is I would look at  you somewhat perplexed and answer, "You mean you haven't done it already"?

The manner in which Washington, i.e., the federal government determines if we are in the midst of a recession is severely hampered by the method in which information is gathered.

By the time the requisite marks are met on a national basis the majority of the country is already in the depths of economic peril.

One look around at the number of foreclosures across the country is a sure sign of economic woes.

As an appraiser I typically see that a downturn in the economy is indicated by a surge in foreclosures 18 months (on average) prior to Washington even having a sniff of what's to come. We tend to forget or perhaps not see the big picture of how important this early warning sign is to those who have the ability to make a difference.

Almost every early foreclosure involves a lower income family. That loss effects more than the pockets of that family it also reaches out and touches the rest of us financially. That domino effect begins moving slowly at first and then ends up at a clip that is detrimental to everyone's pocketbook.

What can be done to change the system in order to make things better? We can start with using data that is contemporary rather than up to a year old. This can be done with a simplistic sampling system. The other problem is endemic and is hard to challenge. Government is top-heavy in their thought process. If you really want to know what is happening then talk to those of us in the "trenches".

In addition to being a radio talk-show guest speaking on real estate I am also one of four political analysts on a weekly talk-show. We've been discussing the recession for quite a while and how it will ultimately affect the upcoming elections. The war and economy are closely tied so look for these two issues, which have an enormous effect upon us financially to influence who voters choose.

No doubt about it we are looking at some significant changes in how we live because of the direction of our economy. Some of these are temporary but many will be permanent.  It will take a major shake-up in our political approach to address these issues.  You have the ability to make some of those changes occur much quicker by contacting your representative. It will only take about five minutes to write a quick email. If you don't receive a response then perhaps it is time for someone else to fill those shoes.

This wonderful software system informs me it has been 154 days since my last post.  Let me apologize for the "vacation" in between.

I'm at a point in my life where the health of my parents becomes a critical issue and it did just that back in May. We've reached a stabilizing point and of course that means you'll have to begin wading through my thoughts on real estate once more.

The topic is, "Why Buy Now"?

A fellow Realtor, Paul Baker of Prudential Commonwealth Realty in Lexington, Virginia, joined me recently on my monthly radio program to discuss what appears to be a major slump in the real estate market.

Paul, who has twenty five years of experience under his belt, conveyed his thoughts on downturns and how they may affect sellers and buyers. After a quick review of the statistical data that I find so comforting in the appraisal field (Specifically from the Rockbridge MLS-Virginia) both of us wondered aloud why wouldn't anyone be negotiating for their next home? Prices are good....very flexible too, the selection is broader and interest rates, though a bit higher than a few years ago, are still under 7% for most credit worthy buyers. Paul noted that certainly beats the 13-20+% rates found under the presidency of George H.W. Bush.

Yes, we all agree that the market is soft and even dangerously so in some areas of the country. However, one snapshot, i.e., Detroit, certainly doesn't apply to the thousands of communities in which the market is still relatively firm. If we listened to those who bemoan the "poor returns in real estate" without doing a bit of a background check then we do ourselves a disservice.

First - who's saying...."returns"? Sounds like people in the money markets speaking to me. Now would you listen to my advice about money markets or would you be more inclined to believe I have some assemblance of knowledge about real estate? Second - has the media, who by the way have given a ton of time to these experts on real estate, given equal time to experts in real estate? Hmmmm. I'll ponder no more.

A wise man does not put his eggs in one basket. If you have money to invest or if you are just looking for that first home then you will find the best deals at the best rates NOW. Guess what happens if you wait it out? You'll be looking back wondering why you weren't the smart guy who took advantage of "the perfect storm".

Remember, just like stocks an investment in real estate is meant to provide return over the long haul. Looking for the quick kill in either area may assist you to the poor house very quickly.

Use your head and contact a Realtor today about purchasing your next investment for the future.  And if you happen to live in the Lexington, Virginia area then be sure to contact Paul Baker.

My thanks again to Paul for being my guest and for spreading his name around.....perhaps a good reason to respond quickly to an invitation by a fellow Realtor to be on the radio...and in his blog...don't you think?

Jim Quist is a real estate appraiser, consultant and commercial property agent with over a decade of experience.  In addition to founding his own appraisal company he also works with a Prudential brokerage and is a partner in a multimedia company. He is a past president of the local Realtors Association and has been and is involved with the local and state associations of Realtors. He has a monthly radio talk show guest speaking on real estate topics.

We are a nation of procrastinators. Perhaps it would be more apt to say mankind in general is prone to put off to tomorrow what could be done today.

I'm as guilty as everyone else.  I have this really nice automatic reminder built into my blog that lets me know when I should be writing a new post. Do I always take heed and put fingers to keyboard? No.

There is one area of procrastination that I would like to address with you that you'll want to correct.  Do you have a will?  A living will? Have you laid out your final wishes....it is never too early.  Who is going to get the house? How about furniture, collectibles and financial holdings?

"Well gee Jim I'm only 30 and I don't have a whole lot and isn't this something for "old people" to worry about"? Nice try.

Now, why would you want to worry about this when you are retiring? Oh, by the way, the reality of life is that we can all "meet our maker" at any moment so don't think you've got a lock on 50 more years just because you're 30!

The fact is you'll be doing yourself a big favor and a huge favor to those you leave behind if you take care of all of the "mortality stuff" right now. If you haven't done it yet, then I encourage you to pick up the phone and call an attorney today.  Maybe a financial planner.  Have you spoken with a funeral director? The list goes on and these are things that you have a better idea of how to handle....after all these should be your wishes.....than those who are handling your estate.

All of this comes to mind as I handle another estate appraisal and consult with the executor regarding value of collectibles....specifically where they should be taken for a proper and qualified appraisal of value. Yes, there are appraisers of rare books, stamps, antiques and more. They can be extremely helpful in determining asking price that may be placed on items for auction or between two parties.

These are issues that should have been addressed earlier and on an on-going basis. But you see we tend to procrastinate and put things off until later.

So, for piece of mind and to make sure you don't place an undue burden upon others why not start the process today.

See that phone over there? And no, I won't accept, "I'll do that tomorrow" as an answer and neither should you.

Jim Quist is a real estate appraiser, consultant, commercial property manager and agent with over a decade of experience.  In addition to founding his own appraisal company he also works with a Prudential brokerage and is a partner in a multimedia company. He is a past president of the local Realtors Association and has been and is involved with the local and state associations.  He is a monthly radio talk show guest speaking on real estate topics.

For those of you familiar with Sherlock Holmes you've deduced there is a mystery and we're in search of clues.

Quite frankly I've had clues dropped at my feet so many times over the years that it has become rather difficult to pretend they aren't there.

The clues have been the number of everyday individuals, many with quite impressive educational backgrounds, who don't know how to balance a checkbook, establish a budget, create retirement portfolio's, understand how seductive and damaging multiple credit cards can be, establish and maintain good credit scores and deal with the intricacies of home loans.

Let me be frank.  We've all had or continue to have problems with at least one of these items in our lives.

Now, why don't we talk about a solution? Elementary, my dear homeowner is more than the title of this blog. It is where we should start immediately to address a growing problem of debt, bankruptcy and foreclosure that will have a profound impact upon us individually, as a community and a country.

With some effort on all of our parts to engage our school board members, local, state and national government leaders we can start a process of teaching children from about the third grade forward how to handle money. This process can begin within a one to two year period making classes in economic responsibility mandatory all the way through high school.  If we start with the youngest and follow that first class through it will allow us to begin training teachers who will be qualified to instruct students on these topics.

These are classes that should be offered without charge to the general population as well through Community Colleges.

We have an opportunity to strengthen our economic well being through this effort and see a significant turn around in under a decade.

Can this be done? Lets find out by starting the effort today.

Jim Quist is a real estate appraiser, consultant, commercial property manager and agent with over a decade of experience.  In addition to founding his own appraisal company he also works with a Prudential brokerage and is a partner in a multimedia company. He is a past president of the local Realtors Association and has been and is involved with the local and state associations.  He is a monthly radio talk show guest speaking on real estate topics.

The first thing I think of when I say the word is Arnold Schwarzenegger, i.e., Governor of California and everybody's "Terminator".

The Exterminator came to mind recently as I'm in the process of doing some renovation to my own home and some of that work is to repair wood boring insect damage.  You may be saying, "Why not just call them termites"? Well, quite honestly that would be leaving out a multitude of organisms that can and will damage your home. Believe me, there are an awful lot just standing in line.

Now, before you think that your home is unlikely to have termites, or any of these other pesky "chompers" let me assure you that without the proper program in place you may well end up with some.

With warmer weather here are some things to start looking for....swarms of flying insects hatching near your house or other structure, an increased number of ants (crawling or winged) in or around your house and areas where the wood or drywall is soft or has what appears to be dirt buildup or residue.

A typical termite may be white and not overly fond of natural light. They tend to build tunnels and have quite an appetite. There are many types of pests so when you notice any activity you should call immediately.

You may see dirt tunnels or "chimney's" (as they build columns in which they can move to the next meal) just about anywhere.  I've personally seen tunnels extending 10 plus feet up a concrete wall in an abandoned gymnasium. I'm not sure they ever found that next meal in that direction.

Here are a couple of quick hints regarding in and around the house maintenance that will help reduce the attractiveness to termites.  I can't repeat this enough - don't put mulch around your house!  Mulch goes around plants out in the yard. When you put it up against your foundation you merely invite termites over to lunch.  Keep bushes and trees cut back. The moisture they hold against the foundation is carte blanche for the hungry. Make sure that runoff from your roof and yard is directed away from the foundation.  If there is a problem consult with a local contractor about installing a french drain.

Finally, I urge you to have frequent checkups for your house by a licensed professional exterminator.  They can address wood boring pests and other undesirables that may come your way as well. Much like your own health it is important to take a proactive approach with your house.

My dad is the perfect example of how homeowners and those who are looking for a new home feel right now. Nervous.

Everytime I stop by to visit he asks, 'how is the real estate market"?

He's been watching a lot of TV and listening to folks who are in the financial markets.  Unfortunately, none of them seem to be gainfully employed in the real estate field so it is much like me trying to represent you in court. Just don't go there.

I guess he has a very good reason to worry as this is what I do for a living....well, most of what I do. I learned a long time ago to diversify so that if one area "softens" then you can look to another to pick up the slack.

Well, I am the real estate professional and here's my take on the market. At least the area in which I live because otherwise I'm completely unqualified to speak about what is happening in Duluth or Boulder or for that matter anywhere outside of the area I focus on.  The market for sales of current inventory is simply "flat". At present.  Will it continue? How long will it continue? Oh, how I wish I owned the proverbial crystal ball.

Based upon trends and the information in hand it would appear that the current inventory of homes in these two markets will face challenges. There are more and more new subdivisions which pit old against new.  New almost always wins.

Now you may be that small percentage of buyer that likes an older home and is willing to pay the same amount of money for it as a new home plus sink an additional $50,000 into renovations but current trends have once again swayed back in solid favor of new. The return is much more favorable.  Let me add, developers are finally getting a grip on providing a product that you are going to have a hard time saying no to.

What does this mean for those trying to sell? You will wait longer to sell your home.  You will most likely have to drop your price.  You will be asked for larger concessions so be prepared.  You may need to invest in fixing up your place to make it more competitive. Finally, you may want to (if this is possible) sit, renovate and wait. 

Eventually the market will begin burning again.  Right now we have glowing embers and not the wildfire that has been running rampant for close to a decade.  Are values WAY off? No. Values are still very strong but you just won't see the enormous appreciation of years past. 

For buyers I have one question.  What in the world are you waiting on? Especially if you are a first time homebuyer.  If you are financially stable, have a good job and can afford some down payment then you need to take advantage of the multitude of great buys, superb loan packages and rates and get out of the bottomless pit of renting.

Back to my dad....everytime we drive through town together he comments on how little he could have purchased this house or that house for yea many moons ago.  When he asks me how much they are worth today he cringes.

Make an investment today. Look into buying but with the knowledge that it is currently advantage buyer and play your cards. Investing in your future is always scary. It isn't nearly as bad as NOT investing in your future.

Jim Quist, a licensed appraiser/consultant is co-owner of Quist Appraisals, LLC and a licensed real estate agent with Prudential Commonwealth Realty.  He is a past President of the local Realtors Association and is heavily involved in multiple community organizations.