https://activerain.com/blogs/bkennedy10 en-us https://activerain.com/blogsview/2623101/finding-leads-in-the-real-estate-business----- I thought about what subject would be the best for me to blog about my first time back in the ActiveRain world during this holiday season. Well, there are many good real estate and mortgage subjects to discuss this year. Being that I spend all my time finding and closing loans. As I'm a Licensed Mortgage Banker in the state of Arizona. I want to focus on how I have developed my business by focusing on supporting local employees. This concept began when I started in the business six years ago. After leaving a long career in hospitality business and moving into mortgages. I knew I had to get in front of as many people as I could and fast. The only thing I could think of was to GO TO THE PEOPLE... The only place for that to be convient for people, was at work. So, we have created the Financial Employee Support Network. A local organization that goes into small companies, associations and any business that has employees or members. We buy lunch or bring some sort of snack. All people love food. Free food! Then we make ourselves avaiable for questions. Bring some sort of educational information to pass out with our contact information. Then based on the group, we provide a seminar or a more casual question and answer forum. The KEY to this Lunch & Learn is being supportive and making yourself avaiable for all employees. On site or off. Your there to support, provide information and help all employees get answers to their financial questions. All I can tell you is that if you put yourself out there. They will come. This one strategy has at least tripled my inbound leads. Along with my database. Just wanted to share a 2011 winning strategy. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Mon, 28 Nov 2011 15:13:43 -0800 https://activerain.com/blogsview/2623101/finding-leads-in-the-real-estate-business----- https://activerain.com/blogsview/2115504/real-estate-and-mortgage-news We all want to be prepared and we all have plenty to prepare for these days. But, there is nothing worse than an unprepared borrower. You know the type...Those clients that just want to assume that thier credit is perfect and they just deserve to get the best deal. They have no financial, credit or income issues. I have one word for those borrowers and those realtors that don't want to waste their time.. PROACTIVE...! Be proactive and get your borrowers in touch with a loan officer that understands the revised regulations, rules and challenges that face potential buyers today. We believe that the PERFECT STORM for buyers of real estate in Arizona has arrived and will continue through until around the end of this summer. Rates are low, home prices have hit bottom or at least close enough to the hitting bottom.  We're now finally seeing a consistant increase of POTENTIAL buyers getting excited about what they MAY be able to afford. For example, I met with a very excited married coupleback in November 2010. We discussed purchasing a home as they have been living in a rental for years providing for thier growing family. They were very excited at the potential of purchasing a home. Now that home prices have come down to affordable levels. When I mean excited, I mean excited. Like a light bulb goes on in their head and they get all gitty like... There is no one that can tell them that they can't afford or buy a home NOW.. You know the type.. You also need the commission. You know I wouldn't share a story about a buyer that I couldn't get qualified.. But, I will share with you the reality of how sometimes you need to slow things down a little. Sometimes you need to really dive into the details of the borrowers situation in order to uncover potential issues with the file.. Let's just consider a few of them... Income verification: How long have they been working at their current job? In this case my borrower had multiple student loans, some deferred and some active. There is a big difference between the two and knowing how to qualifiy a borrower with both is important if you have a borrower with limited income. Our borrower was previously a student along with a veteran. He just started his employment three months prior to getting his contract approved.. Understanding all these scenerios is crucial for making this kind of loan work. Know how to list out all the details for underwriting and provide documentation to verify is priceless. I can't tell you how many real estate agents will send me deals that got turned down. Because the previous loan officer just didn't ask the right questions or understand how to Document, Direct and Deliver to the underwriter. Credit Score: This one is HUGE.. Buyer Beware.... Most borrowers don't have any idea what their credit score is and don't have any idea how it's calculated. After taking a detailed loan application, pulling credit is the next step. Guidelines seem to be changing every month and so does the lenders tolerance level. You have to be an expert on credit reports in order to deliver as a Professional Mortgage Broker these days. You  have to read and understand every line and know how to manipulate the score if you need to.. Back in November when I pulled my borrowers credit we had a 595 mid score. We do have lenders that can get this deal done. BUT, only with strong extinuating circumstances to say the least.. I delivered them a small list of TO DO's which they got done and WA LAAA DEEE DAAA....Their credit score less than two months later is 50 POINTS higher.. I can't share with you how important it is to be working with someone that understands credit reports and guidelines today.. Our client went under contract today.. Very excited for them... Veterans deserve to get loans and we are happy to be working with those that served our country. We will dedicate ourselves to their success as they have done for our freedom.. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Wed, 02 Feb 2011 16:32:49 -0800 https://activerain.com/blogsview/2115504/real-estate-and-mortgage-news https://activerain.com/blogsview/2106440/have-we-hit-the-bottom-of-this-real-estate-market-yet- Well the big question that everyone wants to know the answer to is.. Have we hit the bottom of this real estate market yet? Your answer will most likely depend on who you ask...But I'm here to offer some good news. I believe we have finally can designate this year as the PERFECT STORM to buy real estate and take advantage of these STILL LOW interest rates... Well I know what the interest rates are doing and I can guarantee you this.. They are slowly rising. After December 2010 came in gone. We found that our HISTORICAL LOW interest rates of the year were no longer. We can provide many reasons for the increase during that thirty day period. But, I'm not here to discuss just the rates. I can and will confirm that the rates are STILL very low and they are getting TEMPORARILY lower as the chaos in Egypt causes turmoil in our markets. Well Reuters was nice enough to share their recent polling which includes 33 national economist that shared their outlook for the real estate market in 2011. This is what we found out: Home prices are going to continue to slide before bottoming out in mid 2011. But will rise over two percent for the year as a whole. A fall out in home prices after the First Time Home Buyers Tax Credit expired was no surprise to any of us. The solution to our recovery in housing market solely depends on the job market, which has showed signs of stablizing and will recover over time. Asking our economist polled during our Reuters survey: How much more do you expect the home prices to fall this year? More than the average answered: We expect a drop of 3.3% from where we are today over the next year. But, economist also shared that for those homes that have lost over a third of their value during the worst times of this recession will recover (rise) 2.1% this year. That is important and interesting assumption that we believe will come true. There will be a spike in some home values once the stabilizationprocess finds it's footing. Most economists surveyed believed that home prices have reached their "Fair Market Value" today. Home sales during the month of December provided a strong surge in sales mostly drivin by Arizona and the west part of the country. The housing market is starting to show many signs of recovery. We are very far from what we are used too. But the healing process has begun and now may be the PERFECT STORM for First Time Home Buyers, Investors and those looking to buy that Second Home for retirement. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Sat, 29 Jan 2011 03:24:48 -0800 https://activerain.com/blogsview/2106440/have-we-hit-the-bottom-of-this-real-estate-market-yet- https://activerain.com/blogsview/2099262/real-estate-and-mortgage-news The United States of Department of Agriculture is trying to improve the standards of living in rural areas. Which sometimes lack some of the amenities we are used to here in more urban areas like Internet access, afforable utilities and so on. The USDA is extending their loans and funds to help reduce energy costs for people that live in these remote areas. How you ask? They plan to provide grants that will help both residents and business owners control or sometimes reduce energy costs. They will provide financing for energy efficient and power generation improvements to deliver energy in a more cost effective and environmentally friendly manner. We also have the technology industry that wants a piece of the real estate pie. They plan to bring you and your clients more mobile applications that will allow access for all of us to take control over our everyday products and appliances all from our smartphone. These companies are providing specialized mobile applications to unlock your car door to turning on your television all from another location. Sometime soon every appliance in your home will have an application attached to it or you will find it useless... As for real estate in 2011.. We can expect a 10% increase in sales compared to last year. That may not be what we all expected, as many of us were expecting more. But, with the interest rates on the rise, I will be happy with that prediction and I plan on being a big part of that production expectation. We need to drive through the negativity and focus on all the positive energy that surrounds our gradual economic recovery. Affordability of real estate today is still very high. As in some places the prices of real estate are still falling and we predict rates to get as high as 5.5% towards the end of the year. Still very low rates that set up a great opportunity for buyers of all types. Unemployment may drop below 9% by the end of the year. That will help our situation, along with consumer confidence and spending increases. The increase in jobs and and increase in income levels will help offset much of the impact of the rising rates. This will all help to make 2011 a year of recovery for our housing market. What are some of the new things that home buyers want today? Maybe smaller more efficient homes. There is evidence in print from the Census Bureau that supports these facts. We believe that this downsizing trend will continue for years to come. The population is rising year over year. As of April 2010 we stood at around 310 million. That number is expected to rise to 322 million by 2015 and then reach 422 million people by 2050. Our population is getting older and smarter.. Oh, and don't forget about the buyers of the future... These clients are much more energy conscious and more tuned into the environment. People are more focused on what they need now, and not just want they want....This is an important fact to understand going forward.. Builders need and will build smaller homes with more energy efficient features. They will focus on building homes that can adapt to future changes and additions like technology... So be prepared and keep an open mind on what to expect from our buyers today. We do. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Tue, 25 Jan 2011 15:30:33 -0800 https://activerain.com/blogsview/2099262/real-estate-and-mortgage-news https://activerain.com/blogsview/2087362/the-prequalification-process-to-ensure-your-buyer-is-ready-to-buy-a-home Most of us are aware of all the changes our industry has been though over the past five years and the many more changes that are coming our way. The real estate and mortgage business is just not what it used to be. To be honest I think that is a good thing. Just because RESPA, TILA and the Government have made our industry a bit more challenging. That doesn't mean your clients has to be a victim of all the regulation and obstacles that have been thrown in our way. Believe me, there are more regulations coming. If your not already ready for them and if you don't start preparing your buyers for them now you may lose a few deals this year. Just trust me on that. The Dodd-Frank bill, will be rolling out in April. It will include many more restrictions like compensation overhaul, communication via disclosures along with some things we still don't even know about yet. Very frustrating for all of us. Most consumers don't understand the details of the lending process and what they did understand most likely has changed.  For example: the old GFE was very detailed and broke down everything being charged on one page, very easy to read. The new GFE doesn't explain line items very well, and spreads all the numbers out over three pages of gibberish. Which makes understanding what and where the money is moving to and from very confusing for the consumer to understand. What we all need to do is take time to listen to the borrower. Make sure you understand their needs, and work with them to make sure they understand the details of the home loan process today. Getting them pre-qualified and ready to purchase a home BEFORE they take the plunge into the home finding process. Make sure the borrow is prepared, by asking questions upfront. I do this by spending time with each borrower. Making sure I understand what their long and short term goals are. Also, meeting with them face to face in order to build the trust and solidify the relationship. My ability to communicate is key in order to structure the loan and get all the details laid out early. Prepare the borrower upfront for any potential problems. Explaining WHY we need what we need is very important. Connect the dots for the borrower by using real life examples. The borrower may get frustrated if your not upfront with the reasons we may need a certain document or a tax return or explanation letter. Taking the time to walk the borrower through the process using  real life examples may be the most effective way for them to understand why? I will make myself available to all my clients seven days a week. I believe taking the time to meet with your clients if possible is an important aspect for building their trust. This may be old school for some of you out there. But, I want to show how passionate I am to work for each borrower. Meeting them face to face is a critical part of the long term relationship processes along with referral process. I want to make myself available to answer questions before, during and even after the transaction is closed. Making sure there are no surprises and no one mis-understands the terms of the loan. This gives each client a sense of support, as the home buying process can be down right frustrating for some. The more information the borrower has, the more powerful and confident they are when they are out looking with their real estate agent. Providing our borrowers with a detailed "Documentation Checklist" prepares them for the transaction. It lists out the details of what documents we need along with an explanation why we will need them. After our initial meeting our clients are more confident about what goes into the transaction and why. Along with understanding what thier closing cost consist of and why they are what they are. Most importantly what their monthly payment will be including taxes, insurance and mortgage insurance if necessary. Our initial meeting is usually planned way ahead of the initial loan application if possible. This will uncover any challenges with the file then. So, we can prepare for them or correct them before it becomes an issue for underwriting. This should be a priority for every real estate agent today.. A detailed pre-screening and pre-approval before you start showing them homes. It's necessary for this process to be done right the first time. We just don't have extra time to waste. Providing the borrower with all their options allows more flexibility for the Realtor when showing them homes. We want to support the Realtors and their borrowers. Along with send some of our own pre-approved borrowers back as a referral. We have built our business on finding buyers everywhere we go. Loading the borrower with as much information as possible makes them feel more confident about the whole process. Making ourselves available for questions along the way is yet another way to make borrowers feel in control of what is going on. Providing detailed numbers including payment for a certain offer along with all the options of down payment is critical too. They can be out on the road with a Realtor partner of ours and they want to be able to get answers while in the car. We want to be there for them. As a broker, we are experts with all kinds of loan products not just a few. We have the flexibility to move a loan from one lender to another. FHA allows the transfer of an appraisal and some of our conventional lenders will allow a transfer if needed. Flexibility is key. We want to PARTNER with our Realtors to help them grow their business. We want to be working on potential buyers they may have sitting in their databases today, that we may able to turn into qualified borrowers tomorrow. Get them off the fence and build that potential opportunity into a deal now. Teamwork and partnerships are the KEY to maximizing your success. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Wed, 19 Jan 2011 16:25:14 -0800 https://activerain.com/blogsview/2087362/the-prequalification-process-to-ensure-your-buyer-is-ready-to-buy-a-home https://activerain.com/blogsview/2082692/credit-scoring-strategy-is-just-one-part-of-the-real-estate-engine- Well, we have gone through one of the worst real estate meltdowns we may see in our lifetime. But, as we continue to fight against high unemployment, falling property values and strict lending guidelines not to mention a whole lot of uncertainty. Can we all agree to one thing? We may need to consider using a revised version of our credit scoring system that fits the new conditions of today? I work with real estate investors, self-employed, first time home buyers (FHA), foreign borrowers and all of the above. We all know that the FHA credit guides are the most liberal. But, just recently FHA has begun to raise their credit score requirements along with creating some other more strict guides to follow. Is this something that we need to all pay attention too? We all know what happened when things got to loose. What I don't understand is this... Why do we have to "correct" the system in pieces.. If those that make the laws in our country would communicate with those of us that actually work in the industry. They MAY realize that the system we live in today (real estate & mortgage lending) is a machine with many working parts. If the "machine" is not tuned up every once in a while it runs slow, erratic and sometimes may not run at all. So, when you take your car in for a tune-up, do they just replace the air filter and send you on your way? Not after this type of misfire of systems and departments. Replacing one part at a time only works if your trying to please a portion of your audience or customer. You have to attack the whole system at once understanding how each part feeds and provides information for the other. When you come to pick up your car it runs smooth, quiet  and FAST. WHY? Can't we get all the working parts fixed and communicating together? First we need to understand what is broken. PRICING is determined by a formulation of FICO scores, which predetermines the borrower credit worthiness. Banks, lenders and even most employers use the credit score as the most important data requirement necessary in order to consider an individuals qualifications.  The credit score at the time of loan application will determine the interest rate that individual pays for most likely the next 30 years or a substantial portion of the term of the loan. How the FICO score is calculated has no simple answer. Every lender must breakdown each trade line. Which includes loan balances, credit limits and many other components. Also, they will consider the size of each payment and balance. Along with timing of opened vs closed accounts. If this is not confusing enough just for me to write. This is no easy task to explain or understand to any borrower. Even some of us very experienced lenders have some challenges with the overall consistency of this process. Each bureau has complete access to a long list of financial history of each borrowers data. But, each bureau provides a different version of credit history and performance after formulating a score from the same data. This can cause some confusion along with frustration for all parties involved. What has happened over the past five years during this lending and real estate debacle. Is that most very well qualified borrowers have fell victim to the over cautious,  self preserving banks. Due to decreasing borrowers available credit and squeezing borrowers into an unfair "creditworthiness formula." Which was created to protect the banks balance sheets only. Instead of understanding that many good borrowers are being sacrificed for no reason. Today a high percentage of very qualified borrowers have lower scores at no fault of their own. Come on. I sometimes feel like we have a system that may be to complex for those running it.. That's another subject we can chat about some other time. Just an experienced professional trying to get some others to step back and look at the WHOLE PICTURE... Brian Kennedy, The Relationship Guy (Peoples Mortgage) Mon, 17 Jan 2011 15:28:30 -0800 https://activerain.com/blogsview/2082692/credit-scoring-strategy-is-just-one-part-of-the-real-estate-engine- https://activerain.com/blogsview/2077306/how-do-you-find-your-real-estate-business--- So, I think we all know by now that the state of this real estate market is not what it used to be and probably will never be again. Some of us have cried, some of us have yelled, screamed and complained to even our clients about all the negative changes going on. But, why? None of these things will change the market that's for sure. Not sure about you, but I've never seen a complainer that was part of the solution. Just more like part of the problem. So, back to my question... What are you doing to find business? None of us can answer this question in just one post (hopefully). So, I wanted to contribute this post and many of my future posts to helping others come up with ideas that they may not have thought of before. I want to share some of the proactive services that we mortgage brokers, bankers and local realtors are offering the public (our potential clients) solutions. Or at least, we try and provide potential solutions to their mortgage, real estate, credit and debt problems that face most of us today. I consider myself a people person. So, when I first got into the real estate industry I pledged never to rely on others to bring or send me business. So, I used an old sales strategy I learned while a top Marriott National Sales Manager. Lunch & Learns. It's a simple process of understanding that most of our clients are most likely more confused than we were and need help now. They are as frustrated with the banks as we are. So, what do you do? YOU GO TO THE PEOPLE.. Don't wait for you phone to ring? Get out of your office and build relationships with your local small businesses, Chambers of Commerce and make contact with the decision makers or owners. You may even have some of these leaders in your database. Contact them and make them aware of your service. Call it want you want, create a flyer, add it to your business card. Whatever, you have to do to get the word out. That you want to be the expert that delivers important information to local companies and their employees. to help them get their finances in order at home, to help them understand thier options if they are underwater on their mortgage. Answer questions if they want to buy a home. The list is long. Remember, every boss wants a productive employee. Your work will be to make thier employees more productive by offering a "Service to Support" all employees that will help organize and get them the answers they need to potential financial hardships of all kinds in order to be more productive at work. How? You offer to meet with them on-site. Bring lunch, or just bring you and some printed material with the basics of what your there to do. It's AMAZING the reponse you will get. IF, you focus on solotions and positive information that may help employees that need it. You're not there to help everyone. Your there to provide information, answer questions and support the company as an internal resource. The most important aspect of this process that I can share with you is this... Don't over think it and PLEASE DON'T SELL ANYTHING. Your not there to sell, your there to SUPPORT. If you don't understand that simple rule, you will not go to far.. Again, this is nothing you may not have thought of already or have heard about at your local networking event. You see, you don't have to be all that corporate, and you certainly don't have to make yourself seem like your somebody your not. You just have to TAKE ACTION. I can speak from experience.. THIS WORKS. I do three of these a week and I do more business from just one client base to support a team. Most will think of these great idea's and maybe even shrug them off, hoping that the market will return soon. Well, I can tell you this, when the market does return you will be way ahead of your competition. Because, people remember those that stepped in front of them FIRST. Please contact me if your interested in working with us on these projects or if you have any interest in how we impliment them. I hope this helps someone out there. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Fri, 14 Jan 2011 14:04:38 -0800 https://activerain.com/blogsview/2077306/how-do-you-find-your-real-estate-business--- https://activerain.com/blogsview/2072905/having-a-sense-of-urgency- There are many personal attributes that are needed for success. One: a great attitude, two: hard work, three: honesty, four: knowledge and much, much more. Each of these variables are very important and without these important attributes one is very likely to fail. Today I would like to introduce you to a very important attribute that we often-times overlook. It is the “sense of urgency.”What is this “sense of urgency” and why is it so important? Urgency is what makes us elevate our performance beyond the performance of others. It also allows us to perform well under very tough conditions. The inverse of urgency in this regard would be the feeling of complacency. One can see that those who are complacent are not likely to achieve as much as those who have a sense of urgency. That is very important to understand.. Having a PASSION to succeed…. There are fewer resources available to us in terms of money and even consumer confidence which can be defined as positive energy. We start every day with the same amount of time and the same amount of available energy. We all have the same resources to work with. Who uses them? Many react to down periods by spending their time and energy worrying about why things are so bad. Of course, this makes most freeze up, not understanding the situation. In an era in which we need as much energy as possible, we lose our urgency because we are focused upon a “woe is me” attitude. Those who are going to succeed will need to overcome this very devastating tendency. They are going to have to rise up and gain urgency. What will urgency do for you?Urgency will enable you to look at opportunities instead of crying about how bad things are. In other words, you will look up instead of down. Urgency will help you rise above the masses of those who are mediocre to differentiate yourself in a positive way. In this period you can actually become different just by being positive and that, in itself, represents an opportunity.Urgency will help you achieve more in less time with less resources. Let us this as an example. How quickly and how positively do you follow-up on opportunities? Whether you are responding to an individual lead from a consumer who wants to purchase or a potential business partner, your response time and your response attitude will make allthe difference in the world. You would think that, in this environment, business people would be hungry. Yet, many with down attitudes make their belief about failure a self-fulfilling prophesy by the way they respond to potentially positive stimuli. Successful people follow-up more quickly than  the average one. Have you become complacent because of your previous success or the environment of negativity or both?If you answered yes to this question to any degree, you must start moving in the other direction. The business opportunities you solidify today will be the building blocks for tomorrow. Those without urgency will not have this foundation in place. Their performance will be poor today and when things pick up, they will be too far behind to catch up.  MAKE IT HAPPEN! Brian Kennedy, The Relationship Guy (Peoples Mortgage) Wed, 12 Jan 2011 14:51:33 -0800 https://activerain.com/blogsview/2072905/having-a-sense-of-urgency- https://activerain.com/blogsview/2060474/arizona-rehab-loan-for-a-primary-purchase To all real estate agents and home buyers looking for a primary home that needs some work. There is no secret about this loan, but I'm shocked how many people still no nothing about it. We have been marketing the FHA 203K Rehab Loan for years and have had many successful purchases with it just recently. Think of this loan as an FHA loan on Steroids... If your a buyer looking to take advantage of the rock bottom prices here in Arizona. Or, if your a First Time Home Buyer, and you can't find a home in your price range that doesn't need some serious work done on it before you will consider buying it. Then I have the PERFECT loan for you to consider. How it works: Through this loan program, renovations are done after closing by using a portion of the loan proceeds and applying towards the prearranged improvement costs to the home. For, example, you get pre-qualified for an FHA loan (there is no difference between qualifying for a 203K Rehab vs FHA Traditional loan). Once qualified, make an offer through traditional purchase contract. Again, the contract does not need to reflect the Rehab Loan will be used for purchasing the home. The contract is written for the purchase price only. The seller does not need to know about the money for renovations. Once the contract is accepted and we open escrow the fun begins for us the lender.. We need to consult with the buyer to put together a detailed list of what they would like to renovate. Example. landscaping, roof (non-structural), carpet, painting, appliances almost anything you can think of to make the once mess into your home sweet livable home. Once we have the list of your needs we/client put out for bid to ONLY state licensed and bonded contractors. The client is responsible for choosing the contractor to complete all the work. The list will be submitted with the loan for approval. As long as all renovations are approved (contact me for list of approved renovations) then we continue on to closing, just like any other loan. Meanwhile, the appraisal is done based on "as-is" state of the home. They will include a future "estimated value", which will be included with the original appraisal. In order to confirm that the value of the home will increase in value after all improvements have been completed. Ex. Purchase price is $100,000 approved list of improvements included $30,000, future value will be based off those completed improvements. Funds will be held in an escrow account and distributed after closing directly to the contractor. The contractor has 60 days to complete all renovations and buyer MUST reside in property as their primary home once completed. This is a real basic breakdown of how this loan works. We are EXPERTS with this REHAB loan, and will be happy to share many very successful recent purchases (bank owned) homes that were at best dilapidated and honestly uninhabitable. Then renovated into a PALACE in less than 60 days. The renovations costs used for paying the contractor are combined into the original loan amount. So, your client will only have one payment ex. Loan balance amount using the example above would be $100,000 + $30,000 = $130,000 total loan amount. So, the difference in monthly payment is minimal and NO MONEY OUT OF YOUR CLIENTS POCKET. Are you kidding me.... Every Realtor should be marketing this to the public.. We do, and we get lots of interest... Please contact me for more details on this great home loan. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Thu, 06 Jan 2011 12:45:22 -0800 https://activerain.com/blogsview/2060474/arizona-rehab-loan-for-a-primary-purchase https://activerain.com/blogsview/2058415/buying-a-home-today You have heard many times in the media that real estate is tabooed and it's a bad investment. Despite these comments that only enhance ratings and make a good story. We are here to make sure you all know that real estate is still a great investment and home ownership is is still the American Dream. What we have learned over the past few years and most of us already know: Home ownership is not for everyone. However, more than 60% of Americans own their home and the National Association of Realtors verifies that the average homeowner net worth is 40 times that of renters. I will try and frame some data about the future that is based on real evidence instead of myths and stories. I will start with a historical veiw of home prices. The Census Bureau has recently reported that the median value of homes adjusted for inflation has quadrupled in the last 60 years from 1940 to 2000. Here are some numbers to prove it: Adjust for inflation: 1940: $30,600 2000: $119,6000 Not adjusted for inflation: 1940: $2,938 2000: $119,600 You should know that though home values have dropped significantly in the second half of the last ten years, this drop happened after a very aggressive increase during the first half of this most recent decade. So, prices are much higher today than they were in the year 2000. Now the questions that we all want answers too: Will enough people purchase homes in the future in order to support the price of housing??? Here are some important factors that we must address first to see why the purchase of real estate has slowed: Household formulation is at less of a rate. Slower population growth and families have been doubling up over the past few years. Less couples are having babies and children are living much longer with their parents. Even divorces are being delayed because of the slow economy. To many homes on the Market: With a "shadow inventory" of right around 3 Million to 8 million homes being held by banks waiting for the foreclosure process to come to term. There is a huge over-supply of homes in the market today. This has provided many with a great buying opportunity. These are real situations that may take years to evolve to a better place. But, know one buys a home for the short-term and expects to make lot's of money. There is a strategy to do so. But, most of us do not buy a home to "flip" just to make money overnight. We buy a home to live in it for the long term... So, homes may not appreciate over the next year or two. But, over the next five or ten years I would bet otherwise. Here we have provided some evidence to support this idea. Population Growth: Even after experiencing one of the worst recessions since the Great Depression. The Census Bureau reports that the population of America grew almost 10% in the past decade. That's an increase of over 26 Million people if you can believe that. The bureau has also provided information that by the middle of this Century the population may reach 430 million...That is an additional 130 million people, which was almost the size of our whole country in the 1940's. Will all this growth cause the need for 40% more homes??? Probably not, as much of this growth will be come from immigration and they usually do not tend to purchase homes, at least for a few years after arriving. Household Formulation: The growth rates today are expected to be slower because of the economy. To give you and example The State of the Nations's Housing by Harvard's Joint Center of Housing Studies has forcasted that growth will reach 12-14 million over the next decade. Now the economy will be only a temporary factor. As growth picks up, birth rates and immigration will increase and more children will leave their parents homes. Even the homes that are being foreclosed upon, will need homes to live in eventually. This all means that lower home ownership rates may not reflect into lower housing demand. Now, last but not least the most important factor of them all. The true benefit of owning a home which is the security and sense of establishment along with a place to call home. If you make your payments. Then no one can tell you to leave. In other words, home ownership is not all about the investment of money. It's about the emotion of owning your own home in the place you want to live. Now get out there and buy your Dream Home today. Opportunity awaits those that are ready. Brian Kennedy, The Relationship Guy (Peoples Mortgage) Wed, 05 Jan 2011 15:14:35 -0800 https://activerain.com/blogsview/2058415/buying-a-home-today