Wednesday, November 27, 2013

Today is Thanksgiving!

Thanksgiving is a special celebration full of family gatherings, holiday meals, and giving thanks. It is a time of roasted turkeys, cranberry confections, cornbread stuffing, piping hot pumpkin pies, football games, and holiday parades.

The three-day festival that is now hailed as the “first Thanksgiving,” took place in the village of Plymouth in 1621. Governor William Bradford organized a feast to celebrate the Pilgrims’ first successful corn harvest. Those in attendance included the Wampanoag chief Massasoit. Historians know that the Mayflower’s sugar supply had run low, so the meal did not feature any pies, but one record indicates that four men were sent on a “fowling” mission, which very well may have resulted in a turkey!

Presidents Washington, Adams, and Monroe proclaimed national Thanksgivings, but the custom soon fell out of favor. Then, in the 1820s, Sarah Josepha Hale began a campaign to reinstate the national celebration, and in 1863 President Lincoln proclaimed a Thursday in November as the National Day of Thanksgiving. The holiday has been celebrated ever since

Friday, September 13, 2013

How to Investigate a Potential Neighborhood

You’ve gone to the open house. You’ve had a private showing. You’ve read the disclosures. You’ve decided this is the house for you, and you’re ready to make an offer.
Before you take that step, though, you should fully check out the neighborhood. After all, this is where you’re going to live for years. Is there something you don’t know about that could negatively affect the resale value later? Is there a neighbor who comes roaring home late at night on a muffler-free motorcycle? Is the next-door neighbor operating a day care for pre-schoolers?

Given the high stakes of homeownership, it pays to do your homework before making an offer. For example, a potential buyer was ready to sign on the dotted line for a home in San Francisco, a city famous for its microclimates. The buyer had only been to the home during the day, when it was sunny and warm. On his real estate agent’s advice, the buyer returned at night — to find the house blanketed by cold, windy fog. He continued his home search elsewhere, relieved he hadn’t unknowingly bought into the city’s “fog and wind belt.”

Here are five ways to investigate a neighborhood before you buy.

1. Talk to the neighbors
Without being intrusive, look for an opportunity to chat with your potential neighbors. What’s their opinion of the block and the neighborhood? Do they know of any problem neighbors? Are they aware of any recent car or home break-ins? Is anyone planning a big remodel that could impact other homes or their values? Do they know of someone on the block who might be getting ready to sell? An even more desirable home could be coming on the market.

2. Visit day and night, weekday and weekend
As the San Francisco example shows, don’t just visit the house during the day. Check it out at night to get a sense of what’s going on in the neighborhood after hours. Is it noisy or calm? Visit on the weekend and early morning, too. The more times of day you go, the more chances you’ll have to get the feel for the neighborhood.

3. Check out the local newspaper and the neighborhood blog
Some neighborhoods still have their own newspapers. If there’s one published for the neighborhood you’re considering, check it out for local stories. Pay particular attention to the “police blotter,” which typically lists crimes reported in the area. Also, some neighborhoods have blogs where locals ask for tips and advice, or post issues or concerns affecting the neighborhood. A Google search should help you find out whether there’s a blog for the neighborhood you’re considering.

4. Get an app
Some smartphone apps, such as CrimeReports for iPhone, provide information about crime based on your location or address. Among the problems you may see displayed on a map are noise nuisances, sex offenders and vehicle break-ins. The CrimeReports app gives you some specifics, such as when and where each incident occurred.
Zillow’s real estate apps allow you to see estimates of properties on the block. They also allow you to search recent sales or see rentals, a good indication of whether your neighbors are renters or homeowners.

5. Google the street address
If you Google the home’s street address, you might be amazed at what you find. You might, for instance, discover a nearby home-based business with employees (which could reduce street parking spaces). Using Google’s Street View, where photos can be months if not years old, you might discover that the ground-floor bedroom window once had bars on it.

Be a sleuth before the sale
The Internet is an amazing resource of information. Too often, though, potential home buyers don’t fully use it to find out everything they can before entering into a contract on a home. As soon as you’ve identified a home you want to buy, get online and do your homework. You might be pleasantly — or unpleasantly — surprised by what you learn.

Richmond Approves Plan to "Seize" Underwater Mortgages

Early Wednesday morning the Richmond City Council (on a 4 to 3 vote) approved a plan to "seize" underwater mortgages using their power of eminent domain and turn them over to an investor. Opponents are concerned the plan will dissuade banks from making loans in Richmond.

Meanwhile, on Thursday a federal judge rejected a suit filed by two banks to stop Richmond from seizing mortgages. This decision allows Richmond and Mortgage Resolution Partners (MRP) to move forward. MRP is a San Francisco-based investment firm that is shopping the mortgage seizure plan to cities throughout California.

Thursday, May 30, 2013

Short Sales Losing Favor with Lenders?


Lenders may be less inclined to approve short sales due to rising home prices, according to a new report by RealtyTrac.

During the first quarter, short sales posted a 35 percent drop compared to year-ago levels.

"The decrease in short sales was a bit of surprise given that 11 million home owners nationwide still owe more on their homes than they're worth," says Daren Blomquist, spokesman for RealtyTrac. "Rising home prices are taking away the incentive for short sales on the part of both home owners and lenders."

Foreclosure prices are on the rise, increasing 28 percent in the first quarter. The banks may be realizing they won’t necessarily lose a lot more money by letting a home go into foreclosure instead, Blomquist says.

However, foreclosure sales have been plummeting too, reaching their lowest levels since early 2008. Foreclosure sales made up 21 percent of the total market during the first quarter, which is down from 25 percent one year ago, according to RealtyTrac.

Foreclosure sales peaked in early 2009, when they made up 45 percent of all homes sold nationally.

Still, foreclosures are making up the biggest bulk of sales in certain states, such as Georgia (where 35 percent of sales were foreclosures in the first quarter), Illinois (32 percent), and California (30 percent), according to RealtyTrac.

Monday, May 6, 2013

10 Ways to Reduce Housing Costs in Retirement.....

Housing costs make up one-third of the average American household's budget, the largest monthly expense for most families. And since reducing living costs is the most common way to make ends meet in retirement, it makes sense to take a hard look at your housing costs and what you can do to reduce them.

The secret that will make -- or break -- your retirement Your home equity: How to use it for retirement security Retirement planning outside the box: Move out of the suburbs How to retire with no retirement savings: the "Golden Girls" solution Welcome to Week 12 of my series 16 weeks to plan your retirement. Since most Americans have insufficient savings to fund a traditional retirement, they'll need to look for creative ways to make every dollar count, and finding resourceful ways to lower housing costs will help.

Here are 10 ways to pare your housing budget:

-- Pay off your mortgage before you retire or shortly thereafter. If you're several years away from retirement, consider refinancing with a 15-year fixed mortgage. Interest rates are near all-time lows.

-- Downsize to a smaller house, with reduced bills for utilities, maintenance and property taxes. You might also be able to realize some home equity that can be invested to generate retirement income.

-- Move to a location that enables you to reduce other costs, such as transportation or health care. This could mean moving out of the suburbs and into a city.

-- Move to a less expensive part of the country. There are a number of "best places to retire" websites that you can review to give you some ideas.

-- Move to another country with dramatically reduced living costs. Panama, Costa Rica and some South American and European countries consistently show up on review lists of the best places to live abroad.

-- Rent out a room or two for additional income. This solution works best if you don't want to move and have a large house. After my daughter graduated from college, she rented a room from a retired couple for a year. It was a win-win situation: My daughter had inexpensive housing, and the couple earned some extra spending money.

-- Share housing with other retirees -- what I like to call the "Golden Girls solution." Not only will you share in the cost of housing, but you can also realize savings in regards to your insurance, utilities and even food. Obviously this option isn't for everyone, but don't dismiss it without thinking it through.

-- Consider a reverse mortgage to help you generate retirement income. This solution works for people who own their house and plan to stay for many years. If you didn't or don't plan to buy long-term care insurance, however, I advise keeping your home equity in reserve for a day when you could face high bills for long-term care.

-- Move in with one of your children. Of course, this solution is fraught with emotional issues. Of critical importance for you: How can you make your presence a help to your child's family instead of a burden?

-- Sell your home, and rent something that better fits your needs, such a place with less square footage or one that's part of a senior community. You can use a "buy versus rent" calculator to analyze this possibility; these calculators compare all housing costs when either buying or renting, including the best use of the assets you'd apply for a down payment on a house, and your expectations for rent increases and home appreciation. To analyze this solution as a retiree who currently owns a home, estimate the amount of money you'd realize from selling your house, after subtracting selling costs, and use that as the theoretical down payment on a smaller, downsized house. Then compare that option to the cost of renting a home or apartment.

I realize that some of these ideas may not work or be desirable for everybody. For example, not many people will want to live abroad, and many will want to live close to their children (but maybe not too close!). Or you might find it undesirable to share housing. But if you reach retirement age with inadequate savings for a traditional retirement, you don't have many choices: You'll either need to keep working, reduce your living expenses or work out some combination of the two.

I'm always impressed with the creativity of our readers, so if you have helpful solutions to share, please add them in the comment section below.

As with the other steps in this series, it will most likely take more than one week to investigate your housing options. But get started today, and you'll make great progress. You'll feel more confident in your ability to retire as you investigate various ways to make ends meet. And keep in mind that ultimately, the best place to retire is one where you'll be happy and comfortable.

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