by Rich Schiffer, Weichert Realtors

Many people have asked me about the current economic crisis, and what I think about the proposed $789B economic stimulus bill.

They have trouble understanding why things got so bad, so fast.

I have to admit to them that I have no answer - at least not one that will improve things as quickly as they declined.  In fact the answer that I do have for them is not one that they typically want to hear:  We caused the problem ourselves - essentially through a lack of awareness of the consequences of our actions. 

The movie, "The Butterfly Effect" made many people aware of a complex concept that is part of Chaos Theory.   Simply put - a seemingly innocent action can contribute to a spiral of cause and effect that can ultimately become catastrophic.  The classic example is a butterfly flapping its wings in Sri Lanka in November leading to a Tornado in Oklahoma in February.

In applying that theory to open economy macroeconomics, and looking at the spiral of cause and effect, we can begin to grasp the severity of the crisis.  Consider this:

How many people in total are employed in the construction of a home? 

Factor in not only the construction workers and architects, but you must also consider all the workers that produce the materials that the contractor uses, the truck drivers that deliver the material to the job site, the gas station attendant that filled the delivery trucks fuel tanks, and the workers that built the trucks themselves.  How many people does it take to make the nails which hold your roof on?  How many workers were employed to produce the cut lumber that your walls are framed with?  Now factor in the mine workers that dug the ore that the foundry workers used to make the steel and copper that was used in the construction.  Don't forget the workers that made the power tools used at the construction site, the retail clerks and cashiers that sold them to the contractors.  The heavy equipment was built by someone somewhere, with parts made by someone somewhere.  All the people involved throughout this chain eat somewhere, so we have to also include the grocery store clerks, waitresses, cooks, dishwashers, and lunch-truck caterers who provided service to them.  Then there are the farmers that produce the raw materials that go into our food, and the distributors that get it to market.  Don't forget the auto-workers that built the vehicles that all these people drive to get to their respective places of business. 

Economists and statisticians have estimated the number of people whose work goes into building a single home to be over 64,000.  That number goes up almost exponentially when we consider all the people employed by the homeowner in the first year of ownership - furniture makers, carpet installers, appliance manufacturers, lawn-care workers, painters and the people that make those cute little garden gnomes.

Once we have a clearer picture of the vast interconnectedness of the economy, we can see that a slowdown in the housing market bleeds into many other industries.  Businesses that were over-leveraged or under-capitalized were hit harder than they could bear, resulting in bankruptcies, layoffs corporate downsizing, and emergency bailouts.

The spiral of cause and effect then picks up a head of steam.  The workers who are laid off, or have their hours cut are then forced to cut their personal spending.  This further strains the businesses who had survived the initial slowdown.  They then have to cut back on staffing to match the new decreased demand for their services.  This then creates yet deeper economic shrinkage and we get plunged into Recession or even Depression.  Without an intervention in this vicious cycle, any economic recovery would be a long-time coming. 

Think of the current economy as if it was a person bleeding to death - the longer the bleeding continues, the harder it becomes for the body to function.  The extremities stop functioning first as the body's systems try to maintain heart, lung and brain activity.   Eventually, the body shuts down entirely.  What is needed is intervention to stop the bleeding, and an introduction of new fluids to enable the body to recover.

This is the ultimate goal of the current $789B economic stimulus bill.  Stop the bleeding (job loss) and introduce new fluids (money) to enable the body (the American Economy) to recover.

Whatever their politics, whatever their personal views of such massive government spending, most people will admit that a recovery is better than a continued accelerating downward spiral.

But as I said initially, we caused the problem ourselves.  We can prevent a similar situation in the future if we heighten our awareness of the consequences of our actions, and take actions that will create a chain of cause and effect that acts as an uplifting force.

The end effect of the butterfly's beating wings does not have to be catastrophic.  A positive spiral can similarly be put into motion,

Here are 5 things you can do to help start an economic recovery.

1. Produce something others need.
2. Buy something others produce.
3. Hire someone to do the things you can't.
4. Whenever possible, frequent local businesses.
5. If you borrow, pay back what you owe.

I toured this lovely Raised Rancher in Springfield yesterday.

Sitting on a corner lot, with beautiful landscaping, this could be the home you have been dreaming of.

Three bedrooms on the main floor, and a huge bonus room with a half bath in the attic make great use of the space.

There is even a potential rec-room in the finished portion of the basement, and a very large storage and workshop area as well.

A side porch, a fenced-in back yard and a garage round out the functionalality of this great home in Springfield.

There will be an open House there on Sunday, October 12th, from 1pm to 3pm.  If you can't make it to the open house, schedule a private tour by calling 610-565-1300.

If you would like a list of other homes for sale in the Springfield, Delaware County, PA area, email me.

Rich Schiffer is a REALTOR with Weichert Realtors, and a certified e-PRO.  If you are thinking of selling your house, and would like to reach your potential buyers with progressive marketing techniques, like youtube, blogs, and other highly effective online marketing strategies,  he will be happy to provide you with the type of progressive marketing and personal service you need in today's market.  Contact him, and he will prepare a full marketing plan for you to evaluate.

By Rich Schiffer, REALTOR, e-PRO

You have probably been hearing news stories that go something like this:

"Without perfect credit and 20% downpayment, no one can a mortgage today."  

This is simply NOT TRUE.  

Steve Madonna of Weichert Financial Services, for example, reports that they have many resources to obtain financing for most buyers. In fact, 11 out of 12 loans closed through Weichert Financial Services in the Media, Delaware County, PA office in September were with less than 20% down.  (To contact Steve, call 610-566-2045)

Don't believe the media hype.  Doom and gloom stories capture a broader audience, and help them sell more advertising.  If they told the full story, they would loose thier audience, and their ad revenue.

• You don't need perfect credit.  You do need good credit (Credit score of 620 or higher is preferable).
• You don't need 20% down.  (3% will suffice in most cases, 10% for condos.)

Call your Realtor today to get the facts, not hype. 

Rich Schiffer is a licensed real estate agent with Weichert Realtors, in their Media, PA office.  He specializes in serving first-time home-buyers in Delaware County, PA, and the surrounding areas.  For more information, email him at RSchiffer@weichert.com or call (610) 506-2663.

Many people are vocal about their opposition to the "Bailout Bill" that is about to get a second chance in the House of Representatives.

The common thread of the arguments against the bill boil down to this:

"My money should not be used to line the pockets of greedy corporations that couldn't make sound decisions.  Artificially proping up the economy is un-American."

I can understand that point.  Three years ago, I might have had the same opinion.  But since I started my careeer in Real Estate, I have learned a lot about financing and economics.  This is not to say that I am an expert on the economy, or on the financial industry.  I do however have a different perspective than most people, because of what I know, however.  This article is intended to help people understand why I see this as a great opportunity to invest in our future.

What many people fail to realize is that this "bailout" is not a bailout at all. 

It is not a handout to companies that got too greedy, although it has that initial appearance.

What it boils down to, in the final analysis, is the American People investing in their own economy.

If you could buy a 1 dollar asset for 15 cents, wouldn't you jump at that opportunity?

What the "financial market rescue bill" will do is allow the Treasury dept to purchase "at risk" mortgage assets that lenders have not been able to sell on the open market. Once the lending institutions can divest themselves of those "bad loans" they will be able to resume lending at normal levels.  Don't worry -- they learned their lesson.  Those high-risk loans are not likely to be seen again.

Those "bad loans" which the government will buy are not worthless.

• Not all of them will go into default and not all of those that do will go to foreclosure.
• Everyone of those "bad loans" is secured by real property.
• Real Property, unlike corporate stock, never reaches a zero value. The loans that do foreclose will give the government an asset that can be sold, potentially at a profit.

For taxpayers, this is good news, because it could eliminate a large portion of our federal deficit (or dare I suggest our debt?) down the road.

Warren Buffet once said, "If you want to go fast, go alone. If you want to go far, go together."

That is essentially what this bill will do -- bring us together, as American Taxpayers, to invest collectively in our own economy. It will be as if we created the largest mutual fund in the world, investing in assets that are backed by real estate.   This could end up being seen as the largest government acquisition of land since the Louisiana Purchase.

Keep in mind that real estate over time is a sound investment.
(Since WWII, real estate has appreciated on average about 5.5% per year.)

This is definitely not about "bailing out" the corporate big-wigs that failed to see this collapse coming.

It essentially is about taking advantage of a once in a lifetime investment opportunity -- investing in the future of our country.

Remember, that any monies loaned to these corporations (like was recently done with AIG) will be repaid to the taxpayers, with interest. In addition, stock warrants will be issued, making the American People stockholders in these companies -- stockholders that stand to reap large dividends and gains when these companies stock goes back up.

The Financial Markets are treading on thin ice, wondering what will happen in the days to come.  We have a great opportunity to invest in the "bottom" of the market, buy essentially defining the bottom ourselves.  As soon as we take this bill goes into effect, the markets will rebound like never seen before, and the economy will be back on track -- but with American taxpayers making the biggest profit, not the Wall Street CEOs.

Investing in America's future. That seems like a patriotic act to me, and I am urging everyone I know to support it, despite the outward appearance of rewarding companies for greedy behavior.  Seen from a different perspective, passing this bill should be a non-partisan no-brainer.

For more on this topic see the following articles:

• Bail or Fail (EDIT -- Kristal Kraft hit the nail on the head!)
• Bail Out Bill
• What does NAR think of the Housing Stabilization bill?
• The Bailout Bill is being called a Buy-In!
• Link for the draft of bailout bill...
• Bail out Bill Fails-Be careful what you wish for.....

Like so many others, you watch shows like "Flip This House" and think,
"Wow, what a great way to make money...I should do that." 
You think you might want to "flip" properties, but you don't know where to start. 

For most people, it stops there, and they never invest in a single property.

Some people take that inspiration and become successful real estate investors.

Far too many, however set out to invest, but end up loosing money, or just barely breaking even.

What then should you do to increase your likelihood of landing in the "successful real estate investor" category?

Here are some things to do to help set yourself up for success:

1. Know your limits:
   No single person can do it all. You can dramatically increase your chances of success by having a solid understanding of the limits of your own knowledge.  Knowing when to say "I don't know" is extremely important.  Evaluating your weak points will also help you build your team.  If you don't fully understand your local market conditions, for example, hire a REALTOR® who does.
2. Build a team:
   As was said in #1, above, "No single person can do it all."  To improve your chances of success, you need to build a network of support - your "Team."   Just like a football team, there are many positions that need to be filled.  You need to consider filling the following positions:
   1. Accountant
   2. Attorney
   3. REALTOR® (note -- the agent you select may already have many of the other team members you need already identified and available to fulfill your needs.)
   4. Property Manager
   5. Home Inspector
   6. Appraiser
   7. Title Company
   8. Mortgage broker/banker
   9. Insurance Agent
   10. General Contractor
   11. Subcontractors (Plumbers, Electricians, Carpenters, Painters, etc.)
3. Set your goals:
   By setting specific, measurable results as your goals you will help get yourself on the path to being a successful real estate investor.  Realistic, attainable milestones, rather than colossal hurdles are the key to forward progress.  Work with your REALTOR® to understand the opportunities in your target market, so that together you can set appropriate goals.
4. Define your exit strategies:
   Part of your planning process has to account for your exit strategy, as well.  Knowing when to get out of a costly project is often just as important as deciding which potentially profitable project to take on.  Weigh the advice from your accountant and your REALTOR® when determining the best exit strategies for you.
5. Limit your risk:
   You can limit your personal risk of financial loss by several means.  Maintaining the proper licensing and insurance, (and using only licensed and insured contractors) is one factor.  Limiting personal liability by structuring your project as a separate business entity is another.  When you build your team, use your accountant and attorney to advise you on these matters is essential.  Working with a REALTOR® that understands the application of these business entities in real estate transactions will help you smoothly overcome any obstacles that may come up in the process of a real estate transaction, as well.
6. Follow a plan
   Planning is extremely important.  Not just planning the flow of a particular project, but also ensuring that your plan fits within any master plans that the local municipality may have.  This can help you avoid the need for costly zoning variances and special use permits.  It can also help identify areas where there may be outside development efforts that will effect your property values, for better or worse, in addition to identifying potential incentives for positioning your efforts in targeted opportunity zones that may allow you to take advantage of tax abatements, special rehab financing, etc.  REALTORS® that regularly work with investors will have access to the type of information you need to take these factors into consideration, so working in partnership with your REALTOR to build your plan will help set you in the right direction.

If you see a common thread in these steps, it is intentional.  Working with your REALTOR® every step of the way will help you in more ways than one.  In addition to helping you negotiate the best acquisition price, and helping you get the best price the market will bear for your finished product, by partnering with your REALTOR, and enabling them to best understand your goals, you will create a mutually beneficial relationship - they will be ever vigilant for opportunities for you to succeed in your long-term plan.   Perhaps the best advice was offered by one of the world's most respected investors:

"If you want to go fast, go alone.  If you want to go far, go together." 
-Warren Buffet 

I toured this Springhill Farms condo yesterday.

It is a 1st floor end-unit flat, with 2 bedrooms and 2 full baths.

Shopping in the Glen Eagle Square shopping center is within what I consider an easy walk -- even with my bad knee.

The condo fees cover all your external building and lawn maintenance, so this home could represent a practically care-free lifestyle for you.

To schedule a private showing of this home, call 610-565-1300.  If you would like a list of other properties available in the Glen Mills area, contact me.

Rich Schiffer is a REALTOR with Weichert Realtors, and a certified e-PRO.  If you are thinking of selling your house, and would like to reach your potential buyers with progressive marketing techniques, like youtube, blogs, and other highly effective online marketing strategies,  he will be happy to provide you with the type of progressive marketing and personal service you need in today's market.  Contact him, and he will prepare a full marketing plan for you to evaluate.

Those of you that know me personally, know that I have a passion for writing -- and not just blogs.  I co-wrote the screenplay for the short film, "The Cracked Man", among other things.

The director of that film, Kevin Corcoran, also invited me to help with the production of another film, "Cube Zombies," which premiered last November at the Bryn Mawr Film Institute.  I was credited with the "Sound Recording" for the film.

"Cube Zombies" is getting more exposure.

It will be playing the Terror Film Festival, Thursday, October 23rd as part of a program of shorts that begins at 6:45 PM at the Ethical Society building on Rittenhouse Square in Philadelphia.

http://terrorfilmfestival.net/_wsn/page4.html

(That link is to the schedule page instead of the home page of Terrorfilmfestival.net.  That's because the homepage has loud sound effects that will potentially embarrass you by revealing you are surfing the net instead of slaving away in your cube like a good little zombie...)

If you can come to Philadelphia that day, please come, and support our film.  If you cant make it, why not buy a copy from amazon.com?

The southeastern PA region's largest energy services provider, PECO, has teamed up with ENERGY STAR ® to provide consumers with energy saving tools.  PECO serves over 1.6 million electric customers and 485,000 gas customers.

This is a great example of responsible corporate behavior - a company acting in the best interests of their customers, not just the company's bottom line profit. If PECO customers follow the guidelines, they will dramatically lower their energy consumption.  Bravo, PECO!

Visit www.PECO.com/save for energy saving tips and green information.

Consumers can learn about all sorts of energy saving (and money-saving!) tips by using an interactive "home tour" that features tips for every room of the house, and a link to EnergyStar's Consumer Pledge - a great way for individuals to help fight global warming.

This is not the only way PECO is becoming more eco-friendly.

  Their recent initiatives total more than $15 million in investments, including:

• PECO's first "green building" in West Chester, PA.
• Installation of a "green roof"
• Multiple upgrades to company buildings to secure LEED Certification (Leadership in Energy and Environmental Design)
• Customer support for energy efficiency efforts.
• EasySave Energy Kits - for $20, consumers can purchase an EasySave Energy Kit that includes 3 Compact Florescent light bulbs, an LED nightlight, and a massaging showerhead and a kitchen faucet sprayer head, and several other eco-friendly goodies. (for $25 the showerhead is hand-held.)

I encourage everyone to take advantage of PECO's energy saving programs.

I toured this property in Upland Borough, today

It is a lovely 3 bedroom twin in truly move-in condition.

Beautiful hardwood floors, newer windows, a finished basement with a powder room all make this an ideal place to call home.

The fenced back yard overlooks about 2 acres of well-maintained lawn.

Located on a quiet cul-de-sac, this could be the last home you will ever need.

To schedule a private tour, call 610-565-1300.

For a list of other properties for sale in the Brookhaven / Upland area, contact me

Rich Schiffer is a REALTOR with Weichert Realtors, and a certified e-PRO.  If you are thinking of selling your house, and would like to reach your potential buyers with progressive marketing techniques, like youtube, blogs, and other highly effective online marketing strategies,  he will be happy to provide you with the type of progressive marketing and personal service you need in today's market.  Contact him, and he will prepare a full marketing plan for you to evaluate.

This spectacular 4 bedroom home for sale in the Westgate Hills neighborhood of Haverford Township, Delaware County, PA is practically perfect.

But don't take my word for it...come to the open house on September 7th, from 1-4.

If you can't make it to the open house on September 7th, contact me to schedule a private tour.

You will love the flow of the floorplan, the hardwood floors, the Palladian windows in the Great Room -- not to mention the raised hearth fireplace in the family room.

The skylights and vaulted ceilings in the Great Room brings the open air feeling of the back deck inside -- you will never feel cramped for space here!

The Basement is finished, and has it's own powder room.

The main floor has a laundry room and a powder room.

The upper floor has 4 bedrooms and 2 baths.

I am sure you will fall in love with this house -- so sure in fact, that I set the video to a tune called "Ya Got Me Crazy For Your Love."  Enjoy the video!

Rich Schiffer is a REALTOR with Weichert Realtors, and a certified e-PRO.  If you are thinking of selling your house, and would like to reach your potential buyers with progressive marketing techniques, like youtube, blogs, and other highly effective online marketing strategies,  he will be happy to provide you with the type of progressive marketing and personal service you need in today's market.  Contact him, and he will prepare a full marketing plan for you to evaluate.