50 Citizens Way, Ste. 400
Frederick, MD 21701
301-695-0000
March 10, 2010
Split Market in Frederick
Approximately 6 months ago, Frederick County entered a split market. A split market is where one section of the market is doing much better than other sections of the market. In our current case, houses under $300,000 have generally stopped declining in value and prices have stabilized. However, market data indicates houses above $400,000 are still declining in value at a rate of approximately 1/2 of 1% per month.
We have seen “split markets” before. The most recent split market occurred in 1992. The market had been rapidly increasing until October 1989. The market declined from 1989 until 1992 and then entered a split market where the lower priced housing no longer was declining in value; however, the higher priced homes were still declining.
It is important to understand that there are three types of markets: a down market, a flat
market and an up market. You can’t go from a down market directly into an up market. You have to have a leveling off period. Inversely, you cannot have a market that is rapidly appreciating and then immediately turns downward. There has to be a flat market in between. This flat market can exist for a relatively short period of time, which is typically a minimum of nine months. Or it can be a relatively long period time such as our last flat market (1992 until 1997), which was five years.
Property values have been declining since June 2005,so we have seen declining values for almost five years. For about the last twelve months, prices have not declined as rapidly as they had previously. (The economy is still tough. The bank returned my check marked “insufficient funds”. I called and said me or you?) In a normal market, the sellers of the lower priced homes move up and buy a middle priced home; the middle priced buyer then moves up to a larger, more expensive home; and the seller of the large house buys a farm or large executive custom home.
What we are seeing now is that many of the sellers of the lower priced houses are not moving up. They are either “crabbing” sideways and buying in the same price range, or they are renting or moving in with their parents, etc. There are still some move-up buyers; however it appears that the majority of the sellers of the low end housing are not moving up as times are tough. (It’s also hard to stay married these days. My wife kisses the dog on the lips, yet she won’t drink out of my glass!) This is what’s causing this split market and making the low end market very good while the middle and upper markets suffer.
Raw land sales and farm properties have not experienced as sharp a decline in value as single family residences due to the limited supply. However, it should be noted that farms which have extensive dairy facilities have declined as there simply is little demand for dairy production due to the low cost of milk and the fact that it is extremely difficult to make a living as a farmer (bed and breakfast properties are experiencing the same thing).
The category which has gotten hit the hardest is residential building lots. Residential building lots have declined by almost 50% from their record level peak prices in June 2005. That is because builders are not building as there is no profit in the “spec house” industry. (News Flash: The Olympic Board of Directors has relinquished Lindsey Vonn’s gold medal in skiing and has given the gold medal to residential building lots in Frederick County as their values are going downhill faster).
Many builders are now buying foreclosure properties, fixing then up and reselling. From 6/2001 to 6/2005, property values increased at a rate of 20% per year. That’s a total of 80% in 4 years. I hope I never see 20% appreciation again in my lifetime because you end up paying for it later. Will property values start to go back up in 2010? Probably not until the 3rd or 4th quarter if it happens at all. I wouldn’t break out the Veuve Clicquot and Cuban Monte Cristo #4’s just yet.
Interest rates are the key factor. Inventory is at 1,128, which is good. But job stability and National Debt are huge concerns.
Courtesy of Frederick County Association of Realtors
RISMEDIA, March 9, 2010—If you’re like most Americans, buying or selling a house is one of your life’s most important personal and financial decisions. Therefore, it makes sense to hire a skilled real estate professional to help you achieve your goals, says 2010 Florida Realtors President Wendell Davis, a broker and regional vice president with Watson Realty Corp. in Jacksonville.“A Realtor recognizes the importance of the transaction to the buyer and seller, and uses his or her skills to reach an agreement satisfactory to all parties involved,” says Davis. “Unlike a real estate agent who has simply met the state’s licensing requirements to do business, a Realtor takes the profession to the next level by voluntarily agreeing to abide by a Code of Ethics and by becoming a member of the local, state and national Realtor boards or associations.”
A recent study from the National Association of Realtors (NAR) found that the number of first-time home buyers in 2009 rose to 47%- the highest on record dating back to 1981. Selecting a Realtor to work with is particularly important for first-time buyers who haven’t gone through the complex process of finding a home and negotiating a real estate transaction.
Florida Realtors offer the following tips to help choose a skilled real estate professional:
-Talk with friends, neighbors and co-workers who recently bought or sold a home in the area. What kind of service did they receive? Would they select the same Realtor or company again?
-Look for posted “for sale” or “sold” signs in your neighborhood. A company that is active in your neighborhood, community or condo building warrants further consideration.
-Attend an open house and observe the Realtor in action, judging his or her expertise. Were you shown the home in a professional manner? How familiar was the agent with the property?
-If you’re selling a home, ask if the Realtor and brokerage company are members of a national network or have international alliances that could potentially market your home to prospective buyers across the country or around the world.
-Once you’ve identified several potential Realtors, visit their websites and learn more about their backgrounds and experience. You could also send them an email asking for information on how they’ve helped buyers or sellers.
Once you’ve narrowed your choice to two or three Realtors, ask each of them the following questions.
-How long have you been licensed?
-How long have you actively worked in the area?
-How many home sales have you closed in the last three months?
-Do you work full time as a Realtor or Realtor-Associate?
-Can you give me three names of references whose homes you’ve recently sold?
-How will you work to actively seek buyers for my home?
-Are you a member of the local Multiple Listing Service (MLS)? Do you have your own website?
-Have you earned any specialty professional real estate designations?
Selecting a Realtor is usually based on an individual’s knowledge, skills and personality, Davis says, “When you choose a Realtor, you can be assured you’re selecting a solid, caring professional who will treat you honestly and work diligently on your behalf.”
RISMEDIA, March 9, 2010—With springtime around the corner, Ohio State Waterproofing–one of the largest residential basement waterproofing contractors in Northeast Ohio–offers homeowners the following Do-It-Yourself Tips for protecting their home’s foundation and keeping basements dry.
Prevention
-Avoid planting gardens against the house; watering plants next to the outside walls can contribute to water problems
-Use a home ventilation system in the basement to rid air of excess moisture
-Examine grading: Prevent water from accumulating near a foundation by having lawn graded with a minimum of 2-3 inches of drop for every 10 feet, sloping away from the home
Maintenance
-Check and clean gutters after a heavy rainfall and in the spring and fall (once leaves have dropped)
-Realign downspouts so that water drops at the ground surface, not below
-Repair leaky faucets
-Check area where driveway meets the side of the house and ensure gap is sealed
Should water find its way into your basement, use a solution of bleach and water to knock down mold on floor and walls and then apply a waterproof paint on the walls for a new, clean finish.
“Wet basement problems are found in three out of four homes in America today,” said Nicholas DiCello, president and CEO, Ohio State Waterproofing. “Moisture in the basement is not only a nuisance, but can lead to structural damage and health problems. When a foundation shows any warning signs of water leakage it is the ideal time to fix the problem, as water takes the path of least resistance and will continue to cause damage in a home.”
Signs of water can show up in many different forms, including:
-Damp spots on walls: A block on concrete wall will turn dark gray when wet.
-Mold or mildew: The fungus grows in dark, damp areas on a variety of surfaces, causing discoloration.
-Peeling paint: Look for paint that has become discolored and/or that has begun to chip off the wall.
-Rust on appliances or furniture: The rust may begin on fuse boxes or other metal appliances.
-Musty odor: The smell is the result of the decay process associated with mold, mildew and dry rot.
-Dry rot: It typically grows on wood surfaces, causing wood to decay; can also appear as a brownish-black fungus on walls, clothing and other surfaces.
-Cracked walls and floors: Look for horizontal cracks and step-down cracks on walls and in corners.
-Warped paneling: Moisture in the basement can cause wood paneling to bow out of shape.
-White, chalky substance on walls: Known as efflorescence, this is caused by the drying of mineral deposits on walls.
A: Basically, the costs are no different from when you purchased your existing home. They include moving expenses, loan costs, the down payment, a home inspection, title work and policy, and paying for a new hazard insurance policy. Your lender can give you a disclosure of estimated costs when you apply to be pre-approved for a home loan.
Body Physiology Plays Role in Choosing Mattress
RISMEDIA, March 10, 2010—The Sleep to Live® Institute, a sleep research center dedicated to a holistic approach to researching sleep and its affect on health and wellbeing, in conjunction with researchers from Duke University and the Research Triangle Institute International, is observing National Sleep Awareness Week 2010 with the results of a new study conducted on the most fundamental sleep accessory: the mattress.
The average American purchases a new mattress approximately four times in his or her life, and it is estimated that people spend nearly one third of their lives on a mattress. The Institute studied sleep surfaces and measured factors, such as sleep quality, feeling rested and daytime energy levels. The study was designed to help provide science-based information to consumers to assist them in selecting the right mattress for their sleep needs. Most consumers have a preconception about the type of mattress they need–soft or firm–without considering body physiology, pain triggers and the sleep patterns of a partner.
Better Sleep, More Daytime Energy
As part of the study, participants slept on a full spectrum of mattresses ranging from soft to firm. Researchers found that body type, including spinal curvature and flexibility, factors heavily in determining an individual’s proper sleep surface. When participants in the study had the correct sleep surface for their specific body types, they experienced significantly greater sleep time (increased minutes asleep), improved sleep efficiency (the percentage of time asleep) and increased daytime energy. Additionally, participants experienced a decrease in morning pain on the properly selected mattress.
“When it comes to choosing a mattress, this study suggests that consumers need a mattress that is appropriate for their specific body type,” said Dr. Robert Oexman, director of the Sleep to Live Institute. “Our research discovered that a mattress with proper support and comfort can decrease morning pain, the amount of time spent awake when trying to fall asleep and the feeling of restedness when you awake, demonstrating that one firmness does not fit everyone’s sleep needs.”
For more information, visit www.sleeptolive.com.
Winter Blues Won’t Melt Away with the Snow
The winter brings potential for serious pest issues in the spring.
RISMEDIA, March 10, 2010—For homeowners, the end of winter also signals the end of snow shoveling and high heating bills. But one looming effect of winter–especially after a season that brought heavy snowfall and harsh weather to many regions of the country–is the potential for serious pest issues in the spring. The National Pest Management Association (NPMA) reports that when ice dams form on roofs during the winter they can damage walls, ceilings, insulation and drywall, with resulting moisture attracting pests such as termites and carpenter ants.
An ice dam is a ridge of ice that forms at the edge of a roof and prevents melting snow from draining properly. The melting snow backs up behind this dam and can leak into a home, causing water damage.
It is this water damage that attracts termites and carpenter ants, as these pests specifically seek out moisture. According to the NPMA, termites alone cause $5 billion in property damage in an average year, but the number could rise after a year with excessive moisture. Carpenter ants are also attracted to moisture and cause serious property damage as they excavate wood to build nests.
“With the unusual amount of snow this winter in many regions of the U.S., more homeowners may now be dealing with ice dams and subsequently termite and carpenter ant infestations down the road,” says Missy Henriksen, vice president of public affairs for the NPMA. “Homeowners should take steps to ensure that the snowy winter does not lead to serious pest issues a few months from now.”
To prevent ice dams, the NPMA recommends that homeowners:
-Promptly clear snow off roofs.
-Ensure that gutters and insulation are properly installed.
-Clean out gutters and install gutter guards.
-Most importantly, homeowners should contact a licensed pest professional to inspect for signs of pest infestations.
For more information, visit www.pestworld.org.
RISMEDIA, March 10, 2010—Family reunions are taking on a new meaning in the real estate market. According to a recent survey by Coldwell Banker Real Estate LLC among its network of real estate professionals, in the last 12 months, 37% of sales professionals surveyed noted an increase in home buyers looking to purchase homes to accommodate more than one generation of their family. In addition, almost 70% of Coldwell Banker sales agents believe that economic conditions may cause greater demand for multi-generational homes in their market during the next year.
Furthermore, the Coldwell Banker January 2010 survey respondents cited financial drivers as the No. 1 reason why home buyers or sellers are moving into a house with other generations of their family (39%). Twenty-nine percent said that health care issues are the primary reason, and 6% cited a strong family bond as the main factor.
“While saving money is certainly an incentive for buying a home that accommodates multiple generations, the benefits go beyond just financial reasons,” said Diann Patton, Coldwell Banker Real Estate Consumer Specialist. “With two or three generations living under one roof, families often experience more flexible schedules, quality time with one another and can better juggle childcare and eldercare.”
Communicating with family members and consulting with their real estate professional is key as well. “Talk to everyone involved and determine how comfortable the family members are about sharing bathrooms, office space or common areas, and let that guide your search,” Patton advises. “All of these topics are incredibly important in finding the right kind of home to fit the family–like one that has four bathrooms or one that has three.”
Helpful Hints:
-Sellers with “mother in-law suites” or additional spaces that could accommodate a family interested in a multi-generational living arrangement should highlight this aspect of the home. Whether it’s a garage apartment or refurbished basement, this separate space can help one home stand apart from the others on its block.
-Buyers must be clear about their exact needs. Some families may just want an extra bedroom or two for family members, while others require areas with a separate kitchen, entrance, handicap accessibility or even a larger garage for additional cars. Desired location may also be influenced by proximity to local hospitals, senior centers or other important activities to family members.
-Extended families purchasing a home together should consider signing a written contract outlining everything from finances to chores and childcare. Each family should assess their situation individually and find a plan that works best for them.
For more information, visit www.coldwellbanker.com.
Tips for Easy Spring Cleaning
RISMEDIA, March 10, 2010—Spring is the season for de-gunking, degreasing and de-cluttering. According to a new national survey in the April 2010 issue of ShopSmart, from the publisher of Consumer Reports, spring cleaning is an annual ritual for 58% of women in U.S. households. Twenty-five percent of women do it to get organized and 25% do it to keep a healthy home. ShopSmart’s ‘Clean Smarter’ feature goes room by room to help readers rid every nook and cranny of dirt, dust, smells and germs.
“Not only is it satisfying to make things look, smell and sparkle like new, it’s also a good investment of your time. Appliances, carpets, furniture and fixtures that are maintained will work better and last longer,” said Lisa Lee Freeman, editor-in-chief of ShopSmart. “To make spring cleaning and regular weekly chores easier, ‘Clean Smarter’ offers the following tips and tools that work but are easy on surfaces and minimize the use of harsh chemicals that can irritate eyes, skin, and lungs.”
Bathroom:
Mirrors: Skip window cleaners and instead use warm water and soft, lint-free cloths. Use one damp cloth to wipe down and dry immediately with another cloth.
Toilets: This is one area where you should use an abrasive cleaner like Comet and Ajax.
Showerheads: Clean regularly with a sponge and cleanser. To unclog scaly deposits, simmer a metal head for 15 minutes in one part vinegar, eight parts water.
Shower walls: Wipe weekly with warm soapy water. If soap scum remains, spray with a bathroom cleaner, let stand for 5 minutes, then rinse. Attack dirty grout with a bleach-and-water dipped toothbrush.
Bathtubs and sinks: Tackle porcelain stains with a mix of one cup bleach and one quart of water, leave for 15 seconds, then rinse. Use warm water and vinegar on mineral deposits.
Bath and shower mats: Machine wash in hot water regularly. Scrub rubber mats with warm water and dishwashing liquid. To remove mildew, soak in a bleach solution and rinse dry.
Kitchen:
Refrigerators: Clean from the top down. Empty all contents and wash surfaces with warm water and liquid detergent. Use a toothbrush or cotton swab to clean rubber gaskets, then clean the coils under and behind the fridge at least once a year with a coil-cleaning brush and vacuum.
Ovens: Remove crumbs and debris after each time you cook and wipe down so grime doesn’t build up. For stubborn grime, soak the window with hot soapy water and dry thoroughly.
Microwave ovens: Wipe down with a hot, damp cloth. Scrape off baked-on foods with a credit card. To mask odors, run the oven for one minute with a bowl of lemon juice and warm water inside.
Sinks: Wipe down acrylic, fiberglass or stainless-steel sinks with a sponge with hot water and liquid detergent. It is safe to use scouring powder and warm water on porcelain, enamel or glass.
Dishwashers: Use a toothbrush dipped in warm soapy water and work your way around the edges. Check the filter if it’s removable and the floor periodically to remove debris. Restore shine to stainless-steel interiors by wiping down with white vinegar.
Living Areas:
Upholstery: Vacuum sofas and chair cushions regularly using the upholstery, dusting and crevice attachments. If possible, remove the covers to wash or dry-clean. Once a year, air out and clean the cushion inserts, too. Dry clean feather- and down-filled cushions; machine wash polyester filled cushions.
Carpets: Vacuum at least once a week, but do it more often where there’s heavy foot traffic to prevent dirt from unevenly wearing down carpets. Move furniture and vacuum underneath every six months, if possible. Also vacuum the backs of rugs occasionally. To remove ground-in dirt, shampoo or deep clean carpets every year or two. If your carpet has a significant amount of ground-in dirt and stains, you might want to hire a pro.
For more information, visit www.shopsmartmag.org.
March 9, 2010
A: Ask questions that will give you a sense of the architect’s style, approach to design, and methods of work. For example: What is your design philosophy? What important issues or challenges do you see in my project? How will you approach my project? What will you show me along the way (models, drawings, or sketches) to explain the project? How do you establish fees? What would be the expected fee for my project? What is your experience/track record with cost estimating? If the scope of the project changes later, will there be additional fees? How will these be justified? The Washington Chapter of the AIA offers an excellent consumer brochure that provides additional questions and useful information.
RISMEDIA, March 8, 2010—The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009, which took effect February 22, 2010, requires new disclosures on monthly credit card statements. The Financial Services Roundtable and the Center for Responsible Lending have teamed up to explain a few of these new disclosures, which are intended to make the cost of credit clearer to American consumers.
The Disclosures WILL:
-Show you how long it will take to pay off your entire balance if you pay only the minimum payment each month and make no additional purchases or advances.
-Show if it will take more than three years to pay off a balance at the minimum payment set by the card issuer as well as how much you would have to pay each month to pay off the entire balance in 3 years. Unlike a minimum payment, which goes down as the balance declines, a faster, 3-year payoff calculation is based on your making the same payment each month for 36 months.
-Show the total cost, including principal and interest, if you make only minimum payments to pay off the balance.
-Show the total cost, including principal and interest, if you make the payments to pay off the balance faster, in three years.
-Show how much more interest you’ll pay by making the minimum payments rather than the larger payments to pay off the balance in three years.
The disclosures will NOT:
-Change or extend your monthly due date, which will now be the same date each month.
-Take into account future transactions. If you make new purchases, take out new advances or incur new fees, then the minimum payment, the amount of interest and principal and the length of time to pay off a balance will increase.
-Answer all questions regarding new disclosures. Customers should contact their financial institution directly.
Calculators:
-Statements will now provide information under two scenarios- if you make minimum monthly payments or if you make larger monthly payments to pay off a balance in 3 years.
For more information, visit www.responsiblelending.org.
