Real Estate Information

Monthly Internet Traffic Report Highlights - July 2007 REALTOR.com Unique Visitors: 5.72 M - July ‘07 (6.79 M - July ‘06) 5.29 M - June ‘07 Avg. Minutes per Visit: 14.7 min - July ‘07 (13.8 min - July ‘06) 14.6 min - June ‘07 Avg. Page Views per Visit: 17.3 - July ‘07 (24.9 - July ‘06) 16.9 - June ‘07 Total Visits: 12.6 M - July ‘07 (15.6 M - July ‘06) 11.6 M - June ‘07 Total Page Views: 218 M - July ‘07 (395 M - July ‘06) 197 M - June ‘07 REALTOR.org Unique Visitors: 725,223 - July ‘07 (671,461 - July ‘06) 757,015 - June ‘07 Avg. Minutes per Visit: 7.9 min - July ‘07 (7.9 min - July ‘06) 7.9 min - June ‘07 Avg. Page Views per Visit: 3.9 - July ‘07 (4.1 - July ‘06) 3.9 - June ‘07 Total Visits: 1,050,184 - July ‘07 (999,912 - July ‘06) 1,105,647 - June ‘07 Total Page Views: 4.1 M - July ‘07 (4.1 M - July ‘06) 4.3 M - June ‘07 REALTOR.com Stats Source: comScore Media Metrix (MM). REALTOR.org Stats Source: WebTrends logs, WebTrends Enterprise Edition. Reports 2/07 onward exclude NAR staff traffic.

As I began blogging about the real estate business, which is a labor of love to me, I never thought it would be a place for me to unload what I think is wrong about the industry. I was a real estate investor from a young age, moving in and out of buying and selling properties and managing rentals. I had been doing other investments for a few years and decided to add some investment/rental properties to my portfolio 5 years ago. I hooked up with an agent in Glastonbury who worked for a corporate real estate nameplate, that I still hold in disdain to this day. I won't bore you with too many details but suffice it to say the agent(s) [the deal turned out to be a dual/designated agent deal] looked out for themselves rather than me. They had withheld information material to the property, misrepresented the home and its value as a single family when my due diligence uncovered information to the contrary, and more. I had already spent $650 on inspections and had to kill the deal because I discovered too many seedy things the agent hid and walked away. I reported my experience and displeasure with both the company's listing and selling agent's behavior and unethical dealings and the management supported their thieves and my only recourse was to bring them up on ethics charges to the MLS board. I felt that a waste of time as my findings were that it was more trouble than it was worth and punishments for offenses not stiff enough.

My last statement to my idiot and dishonest agent was that I was going to get my license and show those I served how business should be done. I have been practicing now for just over 3 years with an abundance of success. I have amassed a great deal of unsolicited testimonials and referrals already, have maintained a healthy 6 figure income (ok..just shy of 6 figures at the end of my 1st year) right from the beginning by doing business in a way I simply wanted from the agent who represented me.

I put honesty, integrity, and my client's needs first. Good incomes come from doing a good job and looking out for clients, not your pocket book. I work most every day and am available to my clients from 8am to 8pm daily by email, cell phone, or text message, which ever suits them best. 75% of communications with one of my clients was Blackberry to Blackberry for the purchase of her million dollar home. I give service and attention to every client as though they're my only clients. I provide a level of service that would not only impress me if I were on the other side of the table, but the level of service I wish I could get from any business, but seldom do. I stay up to date on education, the happenings of both the local and national markets and financing, I made it my business to understand financing like I was a mortgage broker so I could employ that knowledge in both marketing seller's homes and negotiating win-win deals for my buyers. I provide 10 times more than the majority of my competitors in the way of marketing including but not limited to professional photography, rich and well design marketing websites, video podcasts to reach the x and y gen customers out there, post listings to Craig's list and similar search venues, use talking house radio transmitters for onsite audio where applicable, mail just listed and just sold 4-color postcards to area residents, create beautiful full color marketing instruments to separate their home from the competition. I use a state of the are website that tracks showing feedback which helps my customers make strategic marketing changes and adjustments to sell for more in a shorter time in a tougher market. Most important...I communicate with my clients personally and often. I try to be present for every showing of my listings rather than just putting a lock box on the door, putting the listing on the MLS and waiting, and much more.

For my buyers, they're automatically tuned it, tapped in, and turned on to finding what they want with my automated system that emails them homes that come to market that fit their criteria. I am available quickly and easily to set up showing tours and help them assess the values of the homes they wish to pursue. They have access to my website that I have spent many dollars and hours making it a resource rich with advice tailored to both buyers, sellers, and relocation customers. I am patient and don't push or pressure them as I know that its not what I say about a house, I am more the catalyst that connects buyers with the homes they connect with and thereafter use my savvy to negotiate great deal, see them through inspections, assist in finding good legal representation, and lending sources that can trust.

So its no wonder when I tell you how frustrating it is to work in a business utilizing these principles to have to, at times, interact with the very kind of agent that was the catalyst for my becoming one. I have 2 such stories to share.

The first one is simply making an appointment for a buyer. I have been working with a woman for almost 2 years and had shown her 50 homes to date (good news...she's soon to make a decision to buy!) and she asked to look at just 3 more homes. I called 2 of the 3 agents who both returned their calls promptly and was more than eager and flexible to meet my client's schedule to view their listings. Good for their clients. These eager, hard working, full-time pros understand the dearth of buyers and did not want to miss an opportunity. Then there's the 3rd agent. Who incidentally works for the corporate bohemoth nameplate that I was disgusted with as a customer myself, only this time it was a their Madison office. I emailed the agent and left 3 voice mails with more than enough time to respond to my request for this client. My email was courteous, professional, and simply asked to show her $1.25M property on the specific day and time and to reply with with confirmation and showing instructions. What I got back at 8pm the day before the showing was a terse, short, and rude reply: "can't show it at noon"

I was dumbfounded. No Mick, or Dear Mick, no sign off, no alternative times that she could show it or even the offer of another day. I called her cell twice more and still no reply by voice or email. The home was simply not shown and the client she serves will never know why her home is not going to get sold. Its unlawful and unethical for me to call the seller directly and now have turned the matter over to my broker for her to handle. This particular agent is a seasoned agent who has either gotten tired of the pace required to do exemplary work, wants to sell her own listings to her own buyers (looking out for her pocketbook rather than the client), or is just gone to part-time and is not covering the time she is off. Whatever the reason, it gives agents like me a bad name and makes me work harder to overcome sour reputation real estate agents have earned with behavior and service like this.

Its my opinion that part-timers have no business in this business. They can't do the job justice. These are folks who want the little nicer car to drive or money for another 2 weeks vacation. Some eventually sell a home, but probably not after creating a negative image of a REALTOR® to some. Its no wonder that there are so many thriving for sale by owner sites, Zillow, and Trulia as a result. The person who hires a part-timer to sell their home or find one for them is paying the same commission and getting much less.

I've decided to make the next story its own post. So look for the post titled Agent/Lender. Conflict of Interest? You decide.

Wow. If you have a loan tied to the prime rate, adjustable mortgage, HELOC, and the like, you just got a big break. The rate has been steady since 2006 and the drop was way more than expected. $50 billion in ARMs were just about to reset next month and this means a big savings to everyone who was perhaps looking at disaster. The prime, which floats 3% above this rate, is now at 7.75%. This is good news for credit card borrowers and loans tied to this rate as well. If you follow my monthly newsletter and statistics, we weren't doing all that bad. I am expecting a spike in activity across the board in both new listings and sales. Stay tuned for next month's stats and we'll just how the rate drop impacts our market.

I have clients I represent that have impressed me. The husband is a brainy tech consultant for an internationally known consulting firm, the wife a talented lawyer. They are living in the 3rd new build/renovated home in Clinton, CT. The house is an example of luxury meets practicality.

The dream home is located directly on the beach and has been designed to withstand 150mph hurricane force winds. All the windows are energy efficient low-e hurricane glass. They designed the exterior to require little or no maintenance and to stand up to its being located on Long Island Sound and all that wind, sun, and salt can throw at it. They buillt a most beautiful house, inside and out, on the small lot they had to work and managed to include plenty of room for perennial gardens, sod lawn, and a 3 car garage. The house was beautifully sited on the shore close enough to the sea wall where can enjoy 180 degree views of the Clinton and Westbrook shore, Long Island Sound, and Long Island itself from most of the rooms in the home. Each floor has its own deck and sunroom.

The home is super-constructed. For instance the weather side of the building, facing the Sound, has an extra layer of sheathing inside and out. Its super-insulated with R50 at the roof and under the floor and R30 on the walls. Its 1st floor elevation meets the FEMA code requirements and yet it looks like any other home on an inland lot. Its efficient. Multi-zone heating allows for them to adjust temperatures to comfortable levels where they are. The addition of radiant heat in the sunroom actually reduces the amount of time and energy the hydro-air system runs while provide barefoot comfort in the winter when enjoying the magnificent views.

Its a "smart" home in that the electrical circuitry is controlled by a PC. Most any outlet or light can be turn on, dimmed to any brightness, on a schedule and be sensitive to the time of year. So it knows when it stay lighter longer and the like. Small, tasteful control panels, one in the master bedroom, and by the front and rear entrances, can turn all lights on at once or off, inside or outside lights. One can individually control each one individually at the Master Bedroom controls.

Good taste is not in short supply when you tour this home. There is a wonderful mix of beach house, victorian, and country elements. It sounds weird when you read it, but you simply get it when you're there. The floors throughout are wonderful random width, maple with mahogany inlay. The foyer, large enough for a baby grand, is open and airy. You notice the staircase just beyond because of the custom, hand carved, spiral newel that supports the wide, victorian style handrail and heavy spindles that leads you aloft. The long inviting hallway beckons you by formal dining room and the beautiful wood paneled elevator towards the bright living room with view of the Sound beyond. The stone, wood burning fireplace uses gas to ensure logs are lit without kindling quickly and with no effort. Its hard to decide where to take it all in...the sunroom, deck, breakfast nook...its hard to decide.

One would expect a grand kitchen in a home such as this...and you wouldn't be disappointed here. Custom cabinetry and paneled appliances mimic the bead board ceilings in the informal dining area and sunroom and is complimented with beautiful granite countertops, a center island with much storage and a wine rack, and the best yet...a butlers pantry for all the stores one could want!

The Master Bedroom is spacious and its amenities and views that of the living area below. A gas fireplace, sunroom, and veranda await you. Large enough for a king size bed, and sitting sofa and the like, yet still room to dance. The ample walk-in closets are a lesson in organization and storage (there are countless closets throughout this 4,400sf home so there's never a need to worry about where your things can go) and the master bath a delight. Spacious granite topped vanities, his and hers line the way to the jetted tub offer view of the Sound and beyond. Custom plumbing fixtures and a steam shower make for it feeling like a vacation hotel suite than home.

The utility room doesn't feel like utility at all. Also light filled with tile floors, large sink, washer, dryer, and microwave oven to make tea and coffee, and plenty of storage again.

2 more bedrooms on this floor share a bathroom most don't enjoy as a master bath. This suite adjoins to a wonderful sunken living room. One of the bedroom provides its guest with one way glass that allows a view of the beach and water even though its towards the rear of the home...and a private deck, and flat screen. Its makes for the perfect in-law or au pair suite. Its also the best place to hang out when the lack of good weather keeps from the beach and water. There's an additional washer and dryer hookup and rough-in's for yet another bathroom and separate entrance has been provided.

The 3rd floor is more of the same. This couple uses the 3rd floor as their business suite, the perfect his and hers offices adjoined by a hallway and Jack and Jill bathroom, another sunroom, and veranda of course.

Everyone who has seen this house has said the same thing. Its perfect and so well thought out. More thought out than what a builder or architect can provide. This is a product of the same couple buying and either renovating or building a new home to incorporate more of what they wanted or didn't do the last time they completed a house they lived in. And that's the secret. They live in it and find ways to improve upon not just a house...but a home to live in and enjoy.

Here's the good news. They off to do it again...which means that this home is for sale as they begin their next project nearby. If you want to see photos or learn more about this incredible home and what this couple did, then visit http://www.167ShoreRoad.com. Its also a featured home on my website right here at http://www.mickmarsden.com.

When the move towards "Natural" and "Organic" first came on the food scene, every Tom, Dick, and Harry jumped on the bandwagon and found loopholes in laws and definition that allowed them to label a product that wasn't really either natural or organic as such. It took a while before laws and certification procedures were put in place to protect consumers from being duped. Green building is in a resurgence from the '70s when only hippies like me thought it was cool. For most builders its new territory. Is it here to stay or just a fad of what's in the news. I'd like to think its really here for good. Being environmentally conscious is not just for Al Gore anymore either. It's becoming mainstream as we watch the polar ice melt at alarming speeds, more catastrophic weather events occur and the like.

This first annoying thing I see are the corporations like Exxon and GE and BP all creating ads stating how they are now moving towards "green" ways. If that were really true about the oil companies they'd be turning their attention to developing cost effective hydrogen production and working with US automakers to own that business. Oil companies already have the best fuel distribution system in place. But no...they want to drill in the artic and put billions into finding more reserves while our government tries to reshape middle east policies to protect oil supplies for the US. As my wife pages through Professional Builders magazine, she tells about the most curious ads regarding companies jumping on the "green" movement. Imagine http://vinylsiding.org/ claiming their green? To me its obvious that this petroleum based product that looks like shit on most homes is trying to shield themselves from an exodus of buyers who are looking to move towards being truly green. That being said what is green building anyway?

What this means to me is building with products and techniques that result in a healthier, more energy-efficient, and environmentally responsible home. Its more of a systems approach to home building that recognizes the home itself is only one aspect of the larger picture. Our world and immediate community must be taken into account as well. This broad-minded approach wants to provide healthy homes that don't poison the occupants or creates myriad allergies and health concerns and more efficient homes that costs 75% less than conventionally built homes to operate along with an eye on preserving and protecting our natural environment.

While green homes are built differently than traditional homes this doesn't necessarily mean that there's a difference in appearance. One does not need to forego style, convenience or comfort. Making life healthier is a primary reason for many to move into a green home. Saving their hard earned cash on utilities and saving the environment is icing on the cake. Energy costs will rise exponentially as China's demands for resources continue and the capacity for fossil fuels remains stationary. The cost benefit alone is reason enough for most to at least think about it.

The problem I see is that some builders I have found on line don't get the whole picture. Building 5,000 square foot McMansions that are more efficient and using some building techniques that qualify isn't quite on the mark. Higher density communities of smaller square foot homes is key. Subdivisions that incorporated single biological septic systems and water systems that are powered by renewal energy such as wind, hydro, or solar is what I am talking about here. The National Association of Home Builders has yet to develop a national standard and thus many local certification standards are popping up all over the country as a result. In this magazine my wife read that a builder who has been building green for 15 years has been asking for a standard for years and was met with reticence. Although they are in the process of developing one, in fact they have a public draft on line available for comment (this link is on the recommended links area on mickmarsden.com), its not here yet. Why after all these years have they just begun the process? I guess I should be happy it will be finalized over the next year or so. In the meantime, standards will vary greatly from area to area and only confuse most consumers looking to educate themselves. Its sort of like our states taking the immigration crisis into their own hands as our government hasn't the guts and/or smarts to deal with this all important issue.

So each region is branding and creating there own standards like http://www.southface.org/web/earthcraft_house/ech_main/ech_index.htm in GA is doing. The most important message I have for this blog entry is that all home builders should start looking to become green builders and that those customers out in the market for new homes to start demanding homes be built differently. What's on your mind about green building. I'd love for you to post your thoughts here.

I read this article below by Lee Howard from the Day in New London. Although I work the New London county too, my office doesn't keep statistics on this region of the shoreline, thus its excluded from my monthly newsletter. Lee's report shows that New London County is enjoying increases in closing, sales volumes, and median price increases. He also shows how new housing starts is off and its my personal experience that new construction has slowed tremendously from just a year or 2 ago. I hope you find this article helpful. As I write this, I just heard a report on CNN that said the Northeast is the only area of the country that has shown a slight increase in home sales. Nationally, values slid 3.75%. We are blessed living in New England and one should not wait to buy or sell waiting for the market to turn. The government is supposed to put in $100M to help those facing foreclosure. Ok..here's Lee's article: New London County and Fairfield County stood out as home-sales stars in the latest figures released Wednesday. In New London County, total single-family home sales in July were up 11.3 percent from the previous year. Median prices also increased from the previous July, by 8.7 percent, to $277,250. In Connecticut, only the more-affluent Fairfield County, with a 5.4-percent rise in home prices, bested New London County's home-price increase of 4 percent this year. Though year-to-date sales totals were off slightly in New London County through July, year-to-date median prices have risen from $250,000 last year to $260,000 this year. “We have job growth, tourism, the military, and the casinos are expanding. ... Pfizer is moving a lot of people in,” said John Bolduc, executive vice president of the Eastern Connecticut Association of Realtors. “We're in what I call a normal real estate market,” Bolduc said. “If you compare to the year 2000, the year before the boom, the numbers are very similar.” Bolduc said low-end real estate in the region is still doing quite well, while high-end sales, reflecting an iffy stock market, have slumped. He added that homes in the $300,000 to $500,000 range, the market for many of the Pfizer employees being relocated from Michigan, remains solid. However, John Tirinzonie, director of job development for the state Department of Labor, said strong sales and price data do not relate to the region's job growth, which has actually been flat over the past three years. He speculated that the price appreciation could be related to a lack of housing supply rather than to labor-market trends. Housing permits in New London County fell 16.7 percent last year when compared to 2005, according to statistics provided by the Department of Community & Economic Development. But the statewide drop in permits was even greater, at 22.3 percent. “Housing is a big issue in that part of the state,” Tirinzonie said. “The requirements for new housing in towns makes it difficult to build a lot of housing.” While other New England states suffer through a real estate slump, Connecticut's housing market continued to show strength in July, with total single-family home sales rising 1.5 percent from last year and prices increasing 1 percent. In comparison, Massachusetts home prices have declined nearly 5 percent during the year. “The housing market correction that's gripping nearby states does not seem to be squeezing Connecticut as much,” said Timothy Warren Jr., CEO of The Warren Group, which publishes The Commercial Record and compiles the statistics. Warren said Connecticut did not experience the wild highs of the Massachusetts real estate market, and it is not going through the lows, either. “How far you fall depends on how far the helium took you up,” he said. “Some of it is psychological. When people are expecting prices to increase at double digits, they tend to fulfill that prophecy.” While home sales are strong, condominiums are not moving quickly anywhere but in Fairfield County. Locally, condo sales in July were off more than 20 percent, and the prices fell nearly 12 percent from the previous year. Year-to-date median prices for condos locally were $185,000, a dip of more than 5 percent from last year. “They're selling, but there's an oversupply,” Bolduc said. The problem, he said, is that it takes two years to get a condo through the approval and building process. In 2005, home sales were still hot, but two years later they have cooled, leaving condo developers no choice but to slash prices. Despite a slump in sales numbers, median condo prices statewide have still managed a 6.6-percent increase from the previous year. The median price of a condo sale in July was $210,500 in Connecticut, according to the latest statistics. Condos represent about a quarter of all home sales in Connecticut. Warren pointed out that tighter lending standards have affected real estate markets around the country, leading to lower sales volume. The Federal Reserve Board meets next week to discuss interest rates, and some have speculated that it might lower rates, spurring more sales. “It may not be quite as easy to sell a home in Connecticut as it was two years ago, and homeowners can't expect double-digit percentages every year,” Warren said. “But the numbers suggest a fairly balanced and healthy market.”

One of my subscribers asked me to do a market segment analysis which I am happy to do. Below is a grid that shows the number of closing and sales volume deltas from 2006 to 2007.

The lazy vacation month of August surprised me as much as July’s report. The number of closings rose 17% when compared to August 2006 and we had a 37% increase in sales volume too! This trend is promising as when we looked at the first half of the year we were of 11% ahead in number of closings but we had a 5% loss in sales volume when compared to the previous year's first half.

When I keep hearing all the negative financial news regarding wall street, mortgages, and the like, I expect to see it reflected in our local numbers. We are lucky we are in an area of the country that is not as affected as those that seem to be driving the news. Too bad good news doesn't sell papers.

Anyway, good news for us here on the CT shoreline and lower CT river valley. The average sales price and median price of a home actually rose in 12 of the 23 markets we serve. Westbrook, Lyme, Salem, and Chester showed the sharpest rises in average sales price at about 20% on average, largely due to sales of newly constructed homes no doubt.

The absorption rate, the number of months that it would take to sell all existing inventory if nothing else came onto the market, or in other words, the amount of time one can expect to be on the market to sell a home is about 7.5 months. But every listing is its own special case. For instance, re-sale homes in move-in condition in good locations and priced smartly will sell quickly. New construction can expect to take all off that time unless its extremely desirable or unique. Those homes who are price too high and/or have deferred maintenance can expect to languish.

All of our markets but 1 showed that sellers got between 90 to 96% of asking price. Lyme was the only notable difference where sellers got only 85% asking price. As Lyme’s average listing price is over $1M its not surprising…there’s a lot of inventory there as well.

We’re finding that its still pretty easy to get someone into a great mortgage. Carl Bulgini of Fenwich Mortgage in Old Saybrook told me that conforming loans are still at great rates and it seems that jumbos are starting to settle down after the shake up. He has many creative ways to save our buyers and sellers money.

If the Federal Reserves steps up and lowers rates as expected, you can expect to see the market do even better in our area.

I am passionate about environmental issues, especially when it comes to cars and new homes. On my list besides a hybrid car to shuttle clients about, is the fabulous Tesla sports car that is totally electric, cool to look at, fast as one could ever want, and the kindest of its kind when it comes to being a carbon neutral car. I searched for new homes in CT that were advertised as green and CT just seems to lag behind some other states. I find a few people carrying the banner, like Barry Katz down in Westport, CT but more people with our mindset needs to step and change their ways.
One of my good builder clients wanted me to participate in a new construction project of 28 homes in a popular shoreline town. I declined as I had enough new construction where the low absorption rate was lower than makes everyone happy. I visited the site (location to remain secret for now) and was bowled over by its beauty. Many acres of wooded and open space amongst 4 delicious ponds beset with native cat of 9 tails, red-winged blackbirds, turkey, deer, hawks, and the like. I simply feel in love with the site. I immediately put doing the first "green" upscale subdivision with an eye on using renewable building materials and solar panels with an eye on making each home 75% more efficient than traditional stick built homes. Wall construction allowing twice or more insulation, recycling of gray water and rain water capture for lawn and garden irrigation, and the like will be incorporated.
A central biological septic system to treat the waste from all homes and a central water system are also planned using solar power to energize these systems where the hope is to sell the excess power back to the grid. This will keep association cost lower as well as the carbon footprint. Many question me as to whether or not people would buy into a neighborhood like this and whether the additional costs to build green can compete amongst the traditional products on the market. I say yes! What are your thoughts. I believe anyone can see that if you're saving upwards of 75% of utility costs to heat, cool, and run a household where the trend for fossil fuels and gas are projected to continually rise...the upcharge for the building cost can be easily justified. You don't have to be a "tree hugger" or environmental activist to see the benefits. You just have to like to breath and care about your children and grandchildren to start and do things to help the global warming that is most definitely showing us the reality with bigger storms, higher floods, and starting to even opponents that its for real.
Please feel free to make your comments and opine on if you think there are buyers for $600K to $900K for energy efficient green homes amongst fabulous surroundings. Custom designs or from our plans or we will design build what you'd like. Imagine a whole community of homes with owners of like minds amongst acres of natural beauty that is close to beaches, shopping and the interstate for easy commuting...but with a rural feeling amongst natural beauty. Its ideal to raise children away from the harmful chemicals found in everything from building materials to lawn chemicals. A place where your family can make for wonderful memories. Look at my links area on my website for a collection of green oriented sites that may be of further interest.

The current banking and mortgage news is scaring the bejesus out of lots of people. I personally think things will settle out just fine. Yes there will be some adjustments, some buyers will have to do some more work improving credit scores, increase savings, and the like. However, those able to document income and assets, have a fairly decent credit score, and a decent down payment can still get financing at a decent interest rate. There are creative ways and programs to save hundreds a month doing mortgage buydowns. This can be seller or buyer funded...but in the current market its mostly a cost to the seller. Because the secondary market for jumbo's went south, rates for them went north. I've heard rates quoted for 30 year fixed at 8.25%.

Here's an example. A buyer last week could qualify to buy a $629,000 home at a 6.5% rate with 20% down. His payment: $3,185. At the current rate of 8.25% his payment jumps to a whopping $3,780 per month!! Just under a $600 increase in a split second. Now he qualifies to buy a $529,000 house. A $100,000 dollar loss of buying power and to this person..a big drop in size, location, condition, and quality or a combination therein.

But we can right this wrong and create a win-win deal to boot! The seller listing at his home at $629,000 can agree to pay approximately $15,000 in points to the buyer's mortgagee and buy that high 8.25% rate down to 6.5% and give him back both his buying power and lower payment. Win! The seller gets the $614,000 at closing (gross), $629,000 less $15,000 in seller paid points. Win!

Its deals like this that can keep sales from tanking. It just takes a little thinking and effort for agents to to understand how financing really works, how its priced, and what mechanisms can be applied to get someone into a home. Or better yet, a home they never dreamed that could afford.

I will close with some bullet points to parse of the state of the mortgage biz and to help understand what's been happening: • Lender guidelines on Alt-A loans have become more strict. • These Alt A loans include "No income verification" loans given to borrowers with credit scores in the low to mid 600 range.. • Last year these loans represented 17% of all loans originated. • Mainly, investors on Wall Street like Hedge funds, stopped buying these loans. • The absence of the secondary market to sell these loans forced lenders to stop offering these types of loan products. • Look for more FHA and government or Fannie Mae backed programs in the near future. • Jumbo ARMs are quite attractive if you can't fund a buy down or don't expect to be in the house long term. Thanks for reading...s