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Soon after HUD Secretary Shaun Donovan  dropped the hint, in a CNN interview, that there might  be another home buyer tax credit on the horizon,  the Calculated Risk Blog posted the thoughts of economist Tom Lawler, that rumors of of another credit would hurt the struggling real estate market by causing buyers to hesitate, or even stop working toward their purchase, in anticipation of the new credit taking effect.

Calculated Risk also reported that a HUD spokesman, when asked if a new home buyer tax credit might be in the works responded, “No news here…there are no discussions underway to revive the credit.”

I hope we don’t see another tax credit and that we don’t even hear any more rumors about one, and here’s why:

1.  Without the previous tax credits, the real estate market would have corrected by now.  As the market stands now, able buyers are waiting for the market to hit bottom, and there is a lot of conjecture that better deals are yet to come.    The credits prolonged the inevitable market rock  bottom in prices.  We won’t be able to call the bottom, only report on the recovery.

2.  Phoenix Real Estate Blogger, Jay Thompson, is 100% correct that the prospect of receiving an$8,000 tax credit is a pretty poor reason for buying a house.  Making the biggest purchase most people will in their lives should be based on a lot more complex reasons and financial considerations than collecting a few  thousand bucks for doing the deal.

3.  If the government is intent on spending money to to stimulate the housing market,  why not spend some of it helping communities fix up blighted properties, HUD foreclosures, and neglected properties to make them eligible for mortgages?  Bolster local initiatives to help people (owner-occupants) purchase in not so desirable areas?  Sponsor community gardens?  Help homeowners keep their homes?  Ah, but not of that really puts much money in the real estate agent’s pocket; nor does any hint of government intervention in distressed properties and neighborhoods please real estate investors.

Home values in certain segments of this area are significantly eroded by rental properties nearby, yet Memphis continues to be touted as a great town for investors.  Home ownership is still a big part of the American Dream.  Owners take pride in their property and in their community.  Renters have little investment other than their security deposit.  Let’s use some of those Federal bucks to build some community pride.  That’s the key to improving the housing market – and keeping our communities strong!

Related articles

• Real Estate Weekly: Home-buyer tax credit not likely to make an encore (marketwatch.com)
• HUD Secretary: Who’s up for another homebuyer tax credit? (hotair.com)
• Will the Homebuyer Tax Credit Return? Should it? (phoenixrealestateguy.com)

3 reasons we don’t need another home buyer tax credit is a post from: Memphis Real Estate Buzz This Feed is for personal non-commercial use only. If you are reading this post outside of your RSS feed reader, you are looking at a website guilty of violating federal copyright law. #memphisrealestatebuzzscraper

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1. Only 7 days left for the $6500-$8000 tax credit

In the ever-changing world of real estate, it seems that more and more real estate “professionals”  are taking additional jobs to supplement their incomes.  It’s hard to give up those big bucks you make when you finally get a deal to the closing table.

In his post on the 1000 Watt Consulting Blog, The whole world is watching, Brian Boero discusses what could become a trend among recognizable, established real estate brokerages to recruit “dual-career agents”.  This is just one factor that further dilutes the public perception of real estate professionals.   I deliberately did not use the term REALTOR®  here, because the National Association of REALTORS® trade organization has not had a solid position or membership requirement that practitioners pursue a  full-time real estate career, and, frankly, they get the same amount of dues from full-time and part-time members.

Although it’s and advertisement for a company I am not affiliated with, this video tells the dual career agent story brilliantly:

To the consumers who may be reading this post:  Have you had a good experience with a part-time real estate agent you would like to share?  Do you know if your agent is/was a full-time practitioner or a real estate hobbyist?  Do you care?

Related articles

• Professional is as professional does (memphisrealestatebuzz.com)

Is your agent doing real estate as a second job? is a post from: Memphis Real Estate Buzz This Feed is for personal non-commercial use only. If you are reading this post outside of your RSS feed reader, you are looking at a website guilty of violating federal copyright law. #memphisrealestatebuzzscraper

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Even as I read articles in black and white from reputable sources about  resale charges and transfer fees,  I am still in shock and disbelief that anyone could attempt to perpetrate a 99 year gouge on property buyers.

The realtor.org daily news updates reports that protest is rising over resale charges, which are transfer fees contractually  imposed by home builders and developers of some properties demanding a 1 percent transfer fee  be paid to them every time the property is sold for the next 99 years.  Could a real estate attorney who doesn’t represent the home builders and developers please explain how this practice could possibly be legal?

The CNN source story for the realtor.org article gives more details.

Related articles by Zemanta

• A one percent resale tax for homeowners for the next 99 years? (walletpop.com)
• The latest real estate rip-off? (money.cnn.com)
• Home-Resale Fees Under Attack (online.wsj.com)
• Coalition targets long string of transfer fees (seattletimes.nwsource.com)

Developers and home builders hatch plan to keep their hands in consumers’ pockets is a post from: Memphis Real Estate Buzz This Feed is for personal non-commercial use only. If you are reading this post outside of your RSS feed reader, you are looking at a website guilty of violating federal copyright law. #memphisrealestatebuzzscraper

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To paraphrase Forrest Gump:  Professional is as professional does.

This post was triggered by a link Rick Rabideau, a Telivant colleague, emailed me:  The front page lead headline of  The Journal News -  Real estate licenses rise 23 percent, an article about the reasons for  increasing numbers of real estate licensees in New York.  Of course the economy, layoffs and general conditions in the job market have sent many searching for new jobs, second jobs or complete career changes.  And real estate seems to be a target job.

In the same article, Farrokh Hormozi, a professor or economics at Pace University, agreed that “one of the characteristics of a recessionary period is that unemployed people or partly employed people try to kind of reposition themselves in another profession.”   So what better “profession” to change to than real estate?  Start up costs are actually pretty low compared to other businesses, but not as low as a salaried job would be.  Entry is easy; easier in Tennessee than becoming a hairdresser.  Just take a course, take the licensing test, pay some fees, find a company to join and you are a REALTOR®, ready to go out and make the big bucks.  And if you have that license the companies will really want you to come to work for them, and the local, state and national organizations will be happy to take your dues whether you ever sell any property or not.  You will most likely be working on straight commission, so there is a real  possibility there that you could make more money as a Wal-Mart greeter than as a  real estate agent.  And in this we-welcome-everyone-into-the-big-tent “profession” odds are 3 to 1 that you won’t be around to celebrate your one year anniversary.

Self-described as America’s largest trade association, the National Association of REALTORS® doesn’t make a hint at being a professional organization.   Oh yeah, there is a code of ethics, and a huge PR machine, and all the appearances that professionalism is the guiding force in the association.  A public article on NAR’s website, Careers in Real Estate touts the advantages and rewards of a career in real estate; suggests pursuing higher education courses oriented toward real estate  to prepare for your real estate career; then rolls right into the heading “Professional Requirements for a Career in Real Estate “  which states that you basically just need a license to get to work.   Now that’s professional

Professional is as professional does is a post from: Memphis Real Estate Buzz This Feed is for personal non-commercial use only. If you are reading this post outside of your RSS feed reader, you are looking at a website guilty of violating federal copyright law. #memphisrealestatebuzzscraper

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1. Re-cap of NAR Midyear Conference

Trustee Deeds are not comps!

Foreclosure auctions are generally held on the courthouse steps at a designated time.  The mortgage holder will set the starting bid, usually the amount owed on the mortgage.  If the loan balance is so high that no other bidders are interested, the mortgage holder takes back the property for the loan amount.  The sale is recorded as a trustee deed.  Maybe values have declined steeply, so here’s a property that has a real value of  maybe $40,000, with a recorded trustee’s deed for $89,000.

I receive a lot of emails and from  investors pitching properties.  I am sure many of you do too.  Everyone wants to make a fortune in real estate, don’t they?  Having some degree of market knowledge after 14 years in the business, some of the deals look pretty good to me.  Some are way out of line.  I took a little time the other day to track down how these folks came up with their numbers, and bottom line was Trustee Deeds.  Here’s an example of  recorded deed info:

Property A

4/30/2010 -  X to Federal National mortgage Association for $73,521 (Trustee Deed – Foreclosure on the Courthouse steps)

7/1/2010  – Federal National mortgage Association to Y  for $19,205 (Fannie Mae foreclosure sale to individual)

Guess which “comparable” the pitchman used.

So I don’t have to tell you investors out there to do your research before you sign the contract, do I?

Trustee Deeds are not comps! is a post from: Memphis Real Estate Buzz This Feed is for personal non-commercial use only. If you are reading this post outside of your RSS feed reader, you are looking at a website guilty of violating federal copyright law. #memphisrealestatebuzzscraper

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