Category Archives: Transcript

Real Estates Biggest Game Changer – PR012 Transcript



 

Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

Want to dig deeper? Find helpful and interesting links by reading the transcript version of this podcast.

What technology might be the biggest disrupter for change in the real estate industry? The internet along with cell phones show you 3D tours, photos, and aerial videos of homes. What could impact real estate more than that? Probably self driving cars! There are several articles that give an interesting perspective on this. What if you had to sell your home due to a disability that limited your freedom to drive to the store, hospital, or even work? You might not have that same challenge in the near future. You could even live out in the country knowing you can sleep or work on your way to the office. Imagine all of the parking spaces that can be turned into building lots if there was a public self driving transportation that kept moving people around without having to stay parked all day.

If you think self driving cars and the benefits they offer are still out into the future, Forbes put a panel of experts together about their “Near-Future Real Estate Predictions.” If you live in Dallas Texas, be prepared to face off with cars marked as a “Driverless Vehicle”.

You will also enjoy watching this video about a Tesla owner who remotely moves his car every two hours to avoid a parking ticket!

Want an interactive graph comparing real estate values between your choice of two of forty four comparable cities across the globe?  Pick any quarter back as far as 1990 and compare it to one as recent as the first quarter of 2018.  You can compare housing prices to disposable income for those time periods. You can choose from twenty of the largest U.S. cities plus see house prices against rents as well.  Who ever knew that learning could be so much fun!

The New York times has a great article on real estate in France and particularly Normandy. Imagine a two bedroom cottage for $125,000. or how about a 17th Century Estate on 10 acres for $1.58 million. With a dip in values the number of interested buyers is increasing as reflected by a 15% increase in number of sale in 2017 over 2016.

In what City have prices reduced by 2.9% through September yet had a 12.5% increase in prospective buyers enter the market in the third quarter of this year compared to last? Can you guess?  London it is! Although Brexit might have something to do with what is happening in real estate, would this pattern still apply to other cities around the world as prices settle downward?

When it comes to Luxury Real Estate, do you know what city in the world had the biggest percentage drop? It was Vancouver B.C. where values dropped 11% and the number of sales down by 36%. Contrast that with Singapore where values increased by 13% end of September compared to the same time one year earlier.

As you or your friends consider buying or selling a home what should your timing be? Now? Or six months from now. If the agent you are talking to says you should buy now before rates go up, is that a “Pressure Tactic” or “Fiscal Responsibility”.

Interest rates are a funny thing. We call a lender and ask what the rate is today, as if one rate fits all. What could possibly affect the response we hear? Type of loan or financing, amount we have for a down payment, credit score, assets, length of the loan and even the financial institution itself.

With the recent interest rate increases you might feel like you missed the boat and rates are pricing you out of the market. If you feel that way, only because you don’t want to pay more for your loan, you may find that historically speaking, borrowing money at today’s rates is still a good thing. View this chart and move your cursor along various data points to see what U.S. mortgage rates have done over the last forty seven years. It is really only the last ten years we saw rates around 5% and below.

Let’s take more of a world picture and see if we are among the more fortunate of home buyers. Numbeo has a chart reflecting 20 year fixed rate mortgage interest rates in countries around the world. The top rate is in Argentina at 27.68%. That probably takes any thought of borrowing money for a home out of your mind. China is in the 5% range, New Zealand, Australia and the US in the fours, Romania, the United Kingdom and Canada in the threes, Hong Kong and Italy in the twos, and  Germany, France, Switzerland and Japan in the ones. Over ninety cities are included.

If you borrowed $300,000. your principal and interest payment with the 20 year example would be $1,380. at 1.0%, $1,980. at 5%, $2,895. at 10%, and $5,096. at 20%.

What happens when California has prices so high, that the median price of $600,000. is affordable to only 25% of the population? They move to places like Boise Idaho where 29% of those viewing a home there on Realtor.com are from California.

Are you a numbers cruncher? Do you want to know the difference between a seasonal slump and a more pronounced downturn? Real Estate agents may sense a market change before it is confirmed by the numbers, but if you want to know what the numbers mean, and what they don’t mean, it is always fun talk to an appraiser. They are the number crunchers in the real estate industry and one appraiser whose insights and data presentations I find fascinating is Ryan Lundquist in Sacramento. Here are two articles worth reading. One is entitled “How would you know if the market was starting to tank?” and the second more recent one “Slumping volume & rising inventory.

If you prefer watching or listening to a video rather than read an article, Ryan has a recent video entitled “What’s The Market Doing.” Even though he is talking about the Sacramento real estate market, if you listen to what he says and how he interprets the data, you will be able to apply what you learn to your local market.

EYE WITNESS TESTIMONY

Buying or selling a home involves a large number of calls, meetings, and pages of paperwork.

The question is, how accurate is your memory?

Let’s look at your memory from another perspective for a moment.

You are in a park enjoying yourself and decide to watch a street performer doing card tricks. You watch the cards move around and are asked to choose a specific card. While you are engaged with the card trick, you look up and see there is some arguing going on and one of those people gets robbed.

How good is your memory? As an eye witness, someone who was there, can you accurately recall what happened? If you have the time, watch this video produced by “Brain Games” and as you interact, you will find out just how accurate your memory is.

In an article entitled “The science of why eyewitness testimony is often wrong” you will learn a few reasons why, when DNA evidence helped overturn a conviction, eye witness testimony was wrong 70% of the time. Does just recalling an event alter what you recall? Learn about how we fill in blank spots so that what we saw makes sense.

Was that book shelf in the house you just saw free standing or bolted to the wall? The answer may make a difference between it being included in your home purchase and having to go out and find another one just like it because it was exactly what you wanted.

How about that beautiful exquisite mirror in the bathroom? Staying or disappearing?

That is why the real estate process and agreed to terms need to be in writing. Less room for misunderstanding. When you go through the house or discuss terms, it is kind of like a doctors appointment, it always makes sense to have someone besides yourself there. Bring a friend or relative along so you have a more in depth understanding of what you saw, or what was said and then reduce that to writing.

In real estate, as in life, if you are the only eye witness, how accurate is your memory going to be?

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.”

 


Interest rates vs Declining Values – PR11 Transcript



 

Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

Want to dig deeper? Read the transcript version of this podcast for helpful and interesting links.

Are you a bird watcher? Do you like Cranes? Did you know they live on all continents except South America and Antarctica? Crane watching can tell us a lot about what is happening in the world today.

Are you familiar with the RLB CRANE INDEX ®? Of course when it comes to this index,  we are talking about construction cranes and not the bird.

Like a big storm sweeping across the U.S. we have gone from storm watching to crane watching, where commercial construction is booming and unemployment low. Wages are rising and it seems like it is full steam ahead.

If you want the world view, there is the RIB International Crane Index®. What cities have moved in up or down in relative construction cost? Dublin up 3 spots, Sydney up 1, and Auckland up 6 spots. Perth and Christchurch each dropped 4 spots, and Madrid dropping 9.

What is happening in North America? Toronto leads with 97 cranes, Seattle jumped back up from 45 to 65 during a six month period. Portland dipped slightly from 32 to 30.

Where was the real estate market so hot that the number of homes for sale went from 87 down to less than 10 in just forty hours? Why, the same place where the vacancy rate for rental houses is 42%, which is the highest in all of British Columbia. How can this be happening in the town of Kitimat? This is a great example of how development can dramatically affect the local economy of any one city or town. In this case it is the approval of Canada’s LNG (liquified natural gas) project.

The U.S. unemployment rate, at 3.7%, is the lowest since 1969. With all of those potential home buyers working, the real estate boom has to continue, correct?

Won’t increasing interest rates put the brakes on the housing market as homes become more unaffordable?

Probably not in the short run. If you have been thinking of buying but felt no urgency, what might be the tipping point to cause you to move into action and buy that home you have been considering? For many home buyers increasing interest rates would cause them to lock in interest rates before they continue to increase and put home ownership out of reach.

Consider this. A $300,000. Loan amortized over 30 years at 5% interest would cost $1,610.46 per month for thirty years for a total cost of $579,765.60  Rates jumping to 6% would cause your loan payment to go up to $1,798.65 for a total loan cost of $647,514.  That is a monthly increase of $188.19 for a total loan cost difference of $67,748.40

So, which side of the coin flip are you calling?  Heads, interest rates are rising and better buy now, or tails, prices are going to level off or even decline to offset the higher interest rates?

If you are in an area where “Price Reduced” is a common real estate ad heading, that doesn’t necessarily mean foreclosures are on the rise. View this chart of historical foreclosure rates as well as a U.S. map of color coded foreclosure rates by city which show foreclosure rates are down 75% in the first half of 2018 compared to the peak during the first six months of 2010.

The New York Times recently did a study of the Denver real estate market. There is a slowdown in the acceleration of prices, but they have to this point continued upward. What is happening in Denver as housing becomes unaffordable? Some leave to more affordable housing in other cities. This trend can be seen in other part of the U.S.

Rising interest rates not only affect those buying a home, but also those thinking of selling and buying.

If you bought a home between 2011 and even as recently as part of 2017, you could have borrowed money somewhere in the 3% – 4% range. If you were not getting a job transfer or had a major life change, would you be willing to almost double the cost of the money you borrowed? Another way to look at that is would you be willing to move and replace your current home with one half the size of what you currently have?

In 2016 the number of people in the U.S. who were moving was at an all time low. From 1985 to 2008 the average time spent owning a home in the U.S. was six years. Can you guess what it was in the latest 2018 report? Eight years? Ten years?  The average is 13.3 years. Check out this map to see what it is in twenty major U.S. cities.

If you are thinking about buying a home, what month do you think would be one of the best to buy in? Realty Trac tracked 32 million homes over 15 years and on average, those who bought in October paid 2.6% less than market value. That is $2,600 for every hundred thousand dollars of house that you buy.

Do you know which neighborhoods in the Portland Oregon Vancouver Washington Metro area where prices are increasing the fastest? Oregonlive has neighborhood maps and statistics that keep you in the know!

If you wanted to compare the headlines and news reports between 2018 and 2007, what might be one way to do that?

Where to find it? Do you know you can go to Archive.org, also known as The Archive Machine, to find news clips of what was happening in 2007? It describes itself as “a non-profit library of millions of free books, movies, software, music, websites, and more.” You not only have the text version of many books, but also the audio version. A recent article goes into more detail about what is offered on Archive.org including a vast classic video game collection you can enjoy.

The amount of information it has on real estate investing, training and news from many sources around the world is worth taking a look at.

The Communication Conundrum

The real estate sale and purchase process is in some ways very simple. Find the house you want. Put in writing some basics such as how much you will pay, what conditions your offer is subject to and when you want to close and make it yours.

How hard can it be to communicate during this seemingly simple process?

Probably no harder than the daily communication we have with each other in our homes or at work.

In 1990, Elizabeth Newton, a graduate student at Stanford University did an experiment which The Harvard Business Review says illustrates “The Curse of Knowledge.” She created a game where you were either a “Tapper” or a “Listener”. The tappers would choose a song that was well known and tap it out. The Listeners would name the song. There were 120 songs tapped out.

If you were a tapper, what percentage of listeners do you think would correctly name the song you tapped out? In this experiment, the tappers expected 50% of their listeners would be able to do that.

When we are talking, sharing, or explaining something about real estate, or any topic for that matter, what are our expectations that those listening will have a solid understanding on what we are saying? Whether are home or work, don’t we really expect everyone we talk to, to understand what we are saying? After all, it is so clear in our minds.

The experiment showed the tappers had an expectation of 50% correct responses. That expectation was met with the reality of only 3 of 120 songs correctly named.

At 2.5%, that means their expectations were met just one out of every twenty times.

You can listen and try it yourself.

Why such a low rate of understanding? One often stated reason is that the idea, task, or concept in our mind is very clear to us because we are familiar with and have studied it.  The question is how to make what we want to convey, as clear to the person we are talking to, as it is to us.

Simple as it sounds, becoming aware of the challenge before you is the first major step you can take. You can also do some more research and learn other ways to overcome this challenge.

The next time you are sharing something that is important to you, remember the experiment of “The Tappers” and the “Listeners”.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.”


What was – What Is – What is to Come – PR010 Transcript



 

Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

Just a reminder that you can access the links and references when you go to the transcription version of this podcast.

WHAT WAS

Information without context is much like the tree falling in the forest. Who will hear it fall? If you are a long ways from that falling tree, or around the bend, you might not see what is happening, but you could hear the barely perceptible muffled sounds of cracking branches as it forces itself against others trees on its journey to ground level. You could be close enough that the loud sound of tearing wood fibers stops you from what you are doing. You might see the tree coming down and be able to take in the whole scene and notice if anyone is within its path of destruction. The worst possible scenario is when that tree is so big and moving so fast, that you see it headed toward you and you don’t have time to react or get out of its way.

What happened to you in the 2007-2008 economy could range from business as usual to life altering devastation, economic slowdown, recession, or depression. Any one of them could describe what you experienced. Even that range of responses could vary from country to country, city to city, and even neighbor to neighbor.

Real estate and the economy can also be like the sky above us. It is just there. In the background as we go about our daily lives. It affects us but is not usually our focus. We enjoy the sunshine and blue sky but sometimes we get rain or snow. It is when the weather becomes extreme, massive amounts of rain or snow, or no rain at all for long periods of time that we take notice. It is when a hurricane comes or a tornado touches down that the weather is no longer in the background.

When you read about economic destruction remember that there are people behind the headlines. The headlines come and go, but those who struggle may continue to do so. There is an article about an Omaha debt collector that helps us get a glimpse into what it is like in America to owe money we don’t have and what happens in the process to both the person owing the debt and the one trying to collect it.

Does the city name of Omaha Nebraska sound familiar to you? It should. This is the hometown of Warren Buffett estimated to be worth over ninety billion dollars. Same city, same economy. But experiencing life in a far different way.

Listen to these quotes:

A real estate crash might not be the most likely outcome, but it certainly seems legitimate to think about what one would look like.”

Take a deep breath. We’re not forecasting a nationwide housing collapse… The problem is as basic as beams and trusses: The triple threat of soaring prices, higher mortgage rates and relentlessly rising property taxes has drastically increased the cost of ownership.”

“Many sellers have stubbornly stuck to listing prices suggested by the sales of comparable homes a year or more ago, despite price drops since.”

Sound familiar? I will tell you when those quotes were made. The first about a real estate crash not being likely was in August of 2006. The second not forecasting a nationwide collapse was May of 2006. The lasts about stubbornly sticking to list prices was about a year later than the first two, August of 2007

How bad was the housing crisis in the United States?

Housing prices peaked in 2006 and in 2007 the median price was $219,000. Contrast that to the 2012 median price of $154,700. which is almost a 30% drop in value. In January of that same year 35% of all homes sold went for less than their original mortgage amount.

In December 2008 60 Minutes produced a segment called “Mortgage Meltdown”. Take the twelve and a half minutes to better understand what was happening with various mortgage loan products and how they affected the consumer.

This meltdown may have started as a U.S. problem but when Lehman Brothers collapsed, the dominos began to fall. The U.S. bond rating was downgraded and the world financial markets felt what was no longer just a corporate problem of failing businesses, but a Sovereign or governmental problem pushing countries to the brink of financial ruin.

Even though it was a global crisis, countries such as Canada refused to join the party and escaped with but mild consequences.

What other Country had their stock market affected but technically missed a recession in 2007? What country had higher home prices in 2009 than 2007? And why?

CBSnews had an article entitled “How Australia Ducked the Crisis”. One of the conclusions of the article was that their choice of trading partners, China, practically negated what was for most, a world crisis. The average Australian might have said “what recession”.

WHAT IS

According to Brookings we have reached a tipping point where half of the world’s populations is considered middle class, and as having some discretionary income. Will we now tip forward? Or backward?

Homes Sales are down and prices reduced across the U.S., right? Wrong! Homes sales numbers in New Mexico continue to set new records with a 45% increase in number of sales for July 2018 as compared to July of 2017.

Let’s come back to Australia, whose fate may be far different now than in 2007 and 2008.

60 Minutes Australia has a two part series entitled “Bricks and Slaughter”. In Part 1 60 Minutes Starts off quoting the prediction that “Housing Values in Australia Could Fall by as much as 40% in the next year.” It interviews homes owners, investors, real estate agents, and data experts. Listen to the parallels of Australia today to the U.S. of 2007 & 2008. In some areas foreclosures rates have gone up over 600%. The big mistake during this crisis, “Believing that house prices would keep going up and up forever.

In Part 2 you hear about the banks who are denying 50% of refinance applications compared to 5% a year ago. Learn about how banks who are raising interest rates or are now requiring principal and interest payments on what once were interest only loans, affects consumers.

Sounds like all of Australia is on the auction block getting ready to be sold for pennies on the dollar.

Real Estate values and trends are local and what was portrayed appears to be accurate. Accurate that is for the City of Paramatta. Maybe not for Australia as a whole.

Is that the true picture? Is that the whole picture? Greg Clough, who was interviewed by 60 Minutes, posted a video clarifying his perspective of what is really happening. Here are a few new quotes:  “70% of Australia’s market is owner occupied and 50% of those do not have a mortgage. 30% of the remaining 50% are in advance of their payments.” He also talks about some of the differences between the loan default process in Australia and what in America he calls “jingle bells”.

WHAT IS TO COME

Some predict a recession is coming to the U.S. Is there one indicator that seems to correlate more than another? It just might be the gap between household income and home prices. And how do they relate to each other? According to a Federal Reserve Study, for every decrease in a home values of $100., consumer spending decreases between $2.50 and $5.00

Did you know there is a Global Real Estate Bubble Index put out by UBS. The highest Bubble risk city?  Hong Kong. The lowest which is considered undervalued? Chicago.

Let’s look at some current headlines or quotes that may sound similar to that of ten years ago:

So, while a crash in the near future is probably not likely, it is important to keep tabs on these fundamentals going forward.

“How to Spot a Real Estate Bubble”

“Opinion: These 4 called the last financial crisis. Here’s what they see causing the next one”

I recently read an article entitled “Stop Extrapolating Your Perceptions”. I perceive something and then I come up with my list of “also must be trues”. The last several years prices have been going up and inventory declining. That would continue forever, right? That was my reality of the moment. However, our local real estate market slowed down the later part of August. It’s the coming recession of course. The next big down turn. Or, it could be the end of summer when families with kids finish their vacations or spend all of their focus on shopping and preparation for school.

Buying or selling a home is most often an event or circumstance driven process. You buy a home to lessen the impact of increasing rent, you sell and move up when your family grows. You may also sell when it is too big, when a job change or divorce occurs.

Just as the world real estate market has common trends and yet variations down to the neighborhood level, so as buyers and sellers we have common motivations with other buyers and sellers, but yet our circumstances are unique.

Most of us in the U.S. have an average of a ten year gap between buying or selling, so for most of us, this is a process that we don’t concern ourselves with.

What we hear about the real estate market in our area may be true, but it may only be partially true. Take the time to do your homework.

When it is time to make some decisions, it is always best to not be driven by fear.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


Where Prices Dropped $70K in 3 Months – PR009 Transcript



 

Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

Is your real estate agent famous? A media personality? Have they made the easy, or not so easy transition from acting, tv or movies to the real estate profession? If you are a Kiwi, a New Zealander, then you would recognize the names of Jayne Kiely or Shane Cortese. For those who don’t, you can still enjoy reading about their transition into real estate as described by the New Zealand website, Stuff.

You might also enjoy what the Wall Street Journal says about media personalities in the U.S. who chose real estate as a second career.

Where might be the best place in Europe to buy some real estate and call it home? Workers in this city are seeing their wages go up and its population is on an upward trend. Businesses are excited about the cost per employee for office space about 25% of what it is in New York just under 32% of that same space in London. What City is that you say? If you guessed Berlin, you were right!

No Real Estate Bubble here. Where is that you say? If you want to do a brain exercise, think a little, read this article recently republished in the “Slovak Spectator.” Learn about rising real estate prices in the Czech Republic and Slovakia and why it appears they are not in a housing bubble.

Contrast that to the Swiss National Bank warning that higher home costs and an uptick in vacancy rates may cause the real estate market to tumble should interest rates start to climb.

How is technology affecting the Commercial Real Estate Market and lending practices? Another Forbes article suggests that poor scanning and data input for multiple units may become a thing of the past with improving technology that may save thousands of hours.

Also soon to come is an automated valuation system on the commercial side similar to the U.S. residential models like Zillow, Corelogic, and House Canary.

Do you know how close a person who flips homes for a living, lives from the houses they flip? A recent article in Forbes says it is 25 miles or less. You might call your local house flipper, a neighborhood expert.

When Realtor.com and Money Magazine got together what do you think they came up with? How about the 50 “Best Places to Live in the America”. They only looked at cities with populations of 50,000 or more, among other criteria. I will pick a state and you see if you can guess the best place to live in that state.

Number twenty on the list is located adjacent to Washington DC and is in Maryland. In 2013, 83.5% of its twenty five and older population had a Bachelors Degree. The Walter Reed National Military Medical Center is also located in this city, which, as you probably know by now, is Bethesda.

Number thirty nine on this list is located in the Pacific Northwest and is Oregon’s fifth largest city. It has businesses such as Intel, Nike, Reeser’s Fine Food, and Epson Portland within its borders. It is the Washington County seat. The city is Hillsboro.

The number one city is located in a State bigger than the United Kingdom, Japan, Spain, or France. It is Frisco Texas.

Where do we see prices reduced and how much?

Let’s look at Seattle Washington. The median home price of $760,000. is a $70,000. drop from where it was three months ago. For those who recently purchased, that hurts. For those who bought around 2012, their homes value has doubled. Beats having that second job to increase your net worth.

What are condos doing? Be glad you don’t live in north King County where the median Condo price has declined 40.5%

See graphs, charts, and additional information put together by the Seattle Times.

As mortgage rates continue to rise, albeit slowly, how will this affect you as a borrower and what are rates expected to do over the next couple of years? Realtor.com does a great job of putting things in perspective as we look back to an 18.63% interest rate in 1981, current rates of about 4.65% and projected rates of 5.5% to 6% in the next two years. Remember that even small increases in interest rates can add up over the length of a thirty year mortgage.  Maybe now is the time to buy?

In 1997 Fred Foldvary, Ph.D. predicated what some called the 2008 Depression. The question is, would his prediction of the next Depression coming in 2026 be tossed out as a scare tactic and not worth a grain of sale? Or should his warning be something that causes self examination and preparedness whether the coming downturn is mild or massive. You decide after reading about “The Depression of 2026“.

“Why Not” Thinking

Life is full of challenges. Sometimes we can’t think outside of the box because we can’t get out of that darn thing. We feel trapped or stuck.

The Laconia Daily Sun has a great article about Cara Brookins who was a single mom with four kids. She needed a place to live but finances were somewhat limiting. She was able to secure a loan for a lot and building materials but she had to provide the labor and her building experience was basically, none.

What would you do? Four kids. Full time job. No experience. Nine month deadline to have that home completed.

Imagine all of the reasons this could not, and certainly would not work.

Ah, but add determination, focus, a lot of work and “Why Not Thinking”, along with a little help and of course, YouTube videos and what do you end up with?

A tiny house? Not quite. Try a 3,500. square foot 5 bedroom home with a 3 car garage. This is a must read article!

Whether in real estate, or in life, it is easy to see all of the reasons why we cannot do something. Why something will not work. Why our goals are unreasonably big.

Maybe it is time we decided to try some “Why Not” Thinking.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


Why You Can’t See It – PR008 – Transcript



 

Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

For you visual learners, you can go to price-reduced.com and click on the “transcript” category on the right side to read today’s episode. You auditory learners might go there  just to learn more by clicking on the links.

Where in the world would you expect to find the world’s largest shopping mall and biggest Chinatown, not to mention the tallest building in the world? How tall is tall? 828 meters which is 2716.54 feet. As you math wizards know, that is just over ½ mile tall.

Learn more about the City of Dubai as it is now, with rising prices, and as it will appear in 2020 for the upcoming World Expo.

Do you know where prices have increased 30% over the last year? In the Cayman Islands of course. Thinking of selling your place in the Cayman Islands? The Cayman Islands Real Estate Brokers Association has posted the Commission rates charged by their members.

Heading north on the other side of Cuba and closer to Miami, China Construction America built the $3.5B Baha Mar Resort in the Bahamas and is working on a $2.1B contract for highway construction in Argentina.

Speaking of South America, Geoffrey McRae wrote an article on South American Land Prices, including Bolivia, Paraguay, Uruguay, Argentina, and Brazil. He discusses land cost, risk, return, taxes, and laws regarding foreign investors.

Expatistan is a website where you can compare the cost of living in Latin America by looking at their map or going down the page to a list of fifty different cities which uses Prague as the baseline. For example Buenos Aires Argentina has a score of 60 whereas the Cayman Islands has a score of 246.

Just so you know, the Expatistan website doesn’t stop there. Their website says they get information from 227 countries covering 2300 cities. If I wanted to compare Paris France to what the cost of living is in Portland Oregon, this website has a category for food, housing, clothes, transportation, personal care, and entertainment. It would cost about 9% more to live in Paris than Portland, however Personal Care products would cost 50% less in Paris. Dream a little. Where would you move to?

Do you know what U.S. age group gained the most in net worth, mostly through home ownership, since the crash of 2007? The same group that lost the most during that time. Learn more from this MarketWatch article in regard to what those born between 1965 and 1980, known as Generation X, have gone through. It also includes a great graphic from the PEW Research Center comparing Gen X, Millennials, and Baby Boomers.

The National Association of Realtors is a great resource for real estate stats in the U.S. They have an article entitled “Metropolitan Median Area Prices and Affordability”. Included is a map which has balloon markers for many metropolitan areas. If you click on a balloon it will tell you the median price for that area and percentage change, in value, over the last year.

They also have a link to an alphabetical list of hundreds of cities and their metropolitan areas. They show how much income you would need to qualify for a median priced home in that area with a 5%, 10%, and 20% down payment loan. In Urban Honolulu Hawaii with 5% down, you would need to earn $189,899. In San Jose California you have to earn $ 335,524. and in Decatur Illinois it would take $23,140.

Want to know what the price reduced picture is like across the U.S.? According to Zillow 14% of all U.S. homes for sale in June reduced their prices. In San Diego it was 20% of all homes had prices reduced in June compared to only 12% the same time last year.

Price reductions or not, the average U.S. homeowner saw their homes value rise 8.3% over the last year.

If you want short updates on the U.S. economy and other interesting facts, sign up to receive email updates from “The Bowtie Economist”, Elliot Eisenberg, PhD. He calls his updates “70 Words on the Economy. Daily

I Don’t See It

I may be looking for something and my wife, Patti will say “it’s in the closet.” Well, it may be but I sure don’t see it.

Or when I ask where something I want for lunch is, she will say “in the refrigerator.” Now, I would like to think my eyesight is good enough and my concentration long enough, that I could find what I was looking for. Some days I am equal to the task. Other days those items seem to be using a cloaking device to make them invisible.

So, what is really happening? Why can’t you see it either?

The New York Times has a great article that talks about “Why we miss things right in front of us”. It is engaging and interactive so be sure to read it.

Sources of Insight does a good job of sharing the keys points of Tony Robbin’s Unlimited Power: The New Science of Personal Achievements Book. It goes over the concept of “schotoma” which literally means “blind spot”. Because we know, or believe something is not going to be found where we are looking, we don’t see it, even if it is sitting right in front of us.

A variation of that is called “Functional Fixedness” which was proposed by Karl Duncker in the 1930’s and discussed in the Harvard Business Review. We see an object based on its common use, not how we could creatively use that object in other ways. When the Titanic ran into the iceberg, did you know there was a way more passengers could have survived. Floating nearby the sinking Titanic was an object estimated to be between 200 and 400 feet long. A gigantic, or you might say, Titanic sized life boat. If it was available to use, why wasn’t it? Who would think to use the very object that the Titanic ran into, and was causing it to sink, as an object of safety rather than danger.

Whether in real estate or in life, we need to recognize we will have blind spots, things we don’t see or pick up on. We also need to recognize that the thing that is causing us such great pain or danger, may actually also be the life raft that provides us safety or life changing benefits down the road.

The sometimes painful path to home ownership can lead to a roof over our heads and become a source of financial security with the passage of time.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


Scam Affecting 150 Countries and 50 U.S. States – PR007 Transcript



Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

If it is easier for you to learn by reading you can go to price-reduced.com and click on the right hand side where it says “transcript”.

As we talk about various areas of the world, even if you don’t live there, the probability is that your real estate market is going through, headed toward, or has just been through a section of the market swing reflected in other neighborhoods and cities. This should shed some light on your particular marketplace.

Ever wonder how much real estate there is in the world? What it is worth? In 2016 it was estimated to be $217 Trillion with 75% of it residential real estate. At the end of 2017 it was estimated to be $280.6 trillion dollars. And the new leader in total largest share of world residential value, up 16% from last year? The answer is: China. If you look to commercial real estate it is the U.S., China, Japan, Germany, and then the U.K.

Ever wonder what country has the worlds largest real estate brand? How about 9 of the 10 largest brands? Once again, it is China.

Portland Oregon had a 12 story wood building in the planning stages which would have made it the tallest of its kind in the U.S. Plans are for the moment, on hold. However, framing is done and Norway continues working on the tallest wood building in the world at 18 stories.

Prices Reduced in the U.K. A recent article is entitled “UK Housing Prices Falling at Fastest Rate Since 2009 Crisis” The author talks about the “Silver Lining” Perspective is everything whether talking about housing prices in the UK or anywhere else in the world. As the author points out, declining prices mean more affordability for home buyers. Declining prices will directly affect those wanting to sell an asset that is most probably the biggest asset they have. Possible their life savings as reflected in the home or flat they own. Although the .2% of value reduction in one month isn’t dramatic, some are saying prices could be reduced as much as 12% before bottom is reached. At an average price of $386,000. A 12% drop could cost homeowners $46,320. That is a lot of money if one had to try and save that much by taking a little out of each pay check. However, if you were fortunate enough to have bought during the low point of the real estate cycle close to ten years ago, you will have found your home’s value has increased by 50%. How is that for a Positive Perspective?

What returned 2 Billion Dollars over 2 years? In fact between October 2013 and May 2018 the total is 12.5 Billion Dollars. Ever heard of BEC’s? That is the acronym for “Business Email Compromise”. A variation of that is called “Email Account Compromise” or EAC. Management and financial officers are tricked into transferring company funds to an entity they think is a trusted business partner or company they might regularly do business with. How prevalent is this? It has occurred in over 150 countries and 50 states in the U.S.

Well you say, I am not a corporate executive or at least I am not the Financial Officer involved with wiring funds. So what does that have to do with me?

Have you bought or sold a house that has not closed yet?  Do you plan on buying or selling a home in the next couple of years? Are you helping someone buy or sell a home or rental property?

The latest adaption of the Business Email Scam has increased 14 fold in the last year and involves you as a buyer wiring funds to close to an escrow company or attorney. That call or email you received with a last minute change of wiring instructions could very well be the most devastating phone call or email you ever receive.

You can read this account of someone named Tom (not me) and what he went through as closing day approached.

So be forewarned, not fooled, when it comes to your next real estate transaction.

What is happening in the US state of Alaska? What segment of their population grew 27% beween 2012 and 2017? This is in contrast to the other segments that had slightly decreasing populations. It is the 65 years old and older crowd. Two Alaskan realtors have suggestions on how to help Seniors with their housing needs.

The housing shortage affecting Alaska is very pronounced in Anchorage where about half as many duplexes were built in the first half of this year compared to last. The number of new multifamily units is drastically worse with 153 permitted last year and zero, yes, zero permitted so far this year.

Another possible factor in the Anchorage housing shortage is that it is one of the Top 100 cities to live in. Anchorage is the place to be with its mountains, lakes, and 250 miles of trails along with the largest area for parks per capita of any city in the U.S. It has a strong economy and is within driving range of 60 glaciers.

The Anchorage School District is home to students that speak 100 different languages. Sounds like Anchorage is prepared to impact many parts of the world no matter what language is spoken.

Are many people buying and flipping houses? There are five zip codes where in the first quarter of 2018 more than 30% of the homes for sale are those being flipped. One of those is the 90047 zip code in Los Angeles. See charts, graphs, and learn about the other 4 in an article by AttomData.

If you live in the Portland Oregon Vancouver Washington area, and you flip houses, how is that segment of the real estate industry doing? In episode 2 we mentioned an article by WalletHub. Looking back at that article which ranks cities by quality of life, remodeling costs, market potential, and a total score, Portland is listed number 149 out of 172 and Vancouver Washington is number 135. That may give you some hard data on why you are having a hard time buying houses to fix up and resell.

There is an article entitled “The New Science of Seeing Around Corners”. It is about a computer vision scientist and his colleague at MIT who take images, sometimes one thousand times dimmer than normal, usually undetectable to the human eye and they bring out or make the undetectable, detectable, The invisible. Visible.

They took a photo of a houseplant and from that photo were able to give a 3D representation of the objects in the room where the plant was located.

This seeing around corners research is also called “non-line-of-sight imaging”.

At Stanford they have recently used laser beams and computer technology to see objects around corners. One of the obvious applications is driverless cars.

Wire Fraud. A big red flag, yet sometimes hidden from the obvious, around the corner of our awareness. Yet looking carefully at small things such as an email address containing a number “1” that looks like the lowercase letter “l”, can save you from the loss of hundreds of thousands of dollars.

Whether in real estate or in life, it is often that which is not so obvious, which might take research or thought, that will help us avoid disaster or recognize great opportunities that others miss.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


The Most Stressful Event in Life – PR006 Transcript



Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

You can go to the source of this information using the links available to you with the transcript of this episode.

What does Italy, France, and now the U.S. state of New Jersey have in common? They all have programs to help Seniors age in place, to be able to stay where they have often called home for many years. Irene, the company in New Jersey helping make this happen, is becoming a popular alternative to the Reverse Mortgage.

Malaysia joins a host of other countries such as New Zealand, Canada, and Australia to have restrictions or bans on selling to foreigners. Why? Foreign capital often pushes prices beyond the reach of local residents.

Did you hear about the International Monetary Fund warning? Kind of like a Tsunami warning if you are located near the coastline. What coastline? The figurative coastline that includes the many cities around the world where the wealthy have purchased high end homes and condos. Or like mountain climbers who are all tied together to prevent a single climber from falling. However, should several of those climbers fall at the same time, then none of those connected will escape the downfall.  Prices reduced in the Luxury Home markets of London, Beijing, and New York. So according to the warning, what is affecting just a few areas now will continue to spread to more cities around the world.

While lower end properties continue to decline in value, in Perth Australia, the high end market has gone contrary to that trend by having a 1.5% increase in value over the last quarter.

The Economist has a great article with graphs reflecting what housing prices have done in 22 cities around the world. Can you guess how much values in these cities have increased in real terms over the last five years?  The answer is:  34%

So, are prices leveling off and decreasing in the U.S. as in other parts of the world? As in all things real estate, it depends on where you live. Redfin did a study of six cities in the U.S. where you can still expect a bidding war. Can you name them? Here is a hint. Four of the six most competitive markets are in California.

What starts in California, doesn’t stay in California. In fact, due to the size of its real estate market, it has been said that California is a precursor of what will happen around the nation. Southern California, with increasing home values, has still seen an 11.8% drop in number of sales year over year. What price range saw a 21% decrease in number of sales?  $500,000. and below.

Learn why one million more people moved out of California than moved in along with information about its housing crisis and where people are going once they leave.

What is more stressful than a job interview? 40% of Americans say this is the most stressful event in their life. I can’t say for sure, but my guess is this 40% probably hasn’t given birth in their lifetime.

Other stats? Thirteen percent thought they overpaid yet only 10% had buyers remorse.

Here is a not too often thought about segment of the first time home buyer market. What segment is that you ask? How about those senior citizens in their 60’s, 70’s or even 80’s or 90’s who never bought a home. Learn what questions they may ask, such as “should I take out a 15 or 30 year loan.”

Speaking of seniors, do you know what other trend they are becoming a part of? How about the tiny house movement. Many don’t need the space they used to have and becoming mortgage free is a bonus.

Speaking of Seniors, what is happening in the Portland Oregon market? According to the Business Journal, when it comes to the assisted living boom, there are 1,000. units currently under construction in Portland and throughout the state of Oregon. View the many projects under construction.

Speaking of a hot real estate market. There is another kind of hot in Portland.

If you live in Portland or have just passed through, the city brings to mind rain and lots of green scenery. Some areas are more level and others hilly. But the temperature across town is the same isn’t it? Not according to an Oregon Live Article where it shows temperatures can vary by as much as 20 degrees from one neighborhood to another.

In the last few minutes you have been listening to this podcast, or reading the transcript, chances are you have been distracted one or more times.

Career Builders found that 75% of the employers they surveyed said they lost 2 or more hours of productivity a day due to distractions with 43% saying they lost 3 or more hours a day.

The reason? Three of the top four were smart phones, the internet, and social media.

How often is the average office worker interrupted? According to a UC Irvine study, the average work is interrupted or changes tasks every 3 minutes and 5 seconds. Recovery time after each interruption? 23 minutes and 15 seconds.

So it takes me about 7 ½ times as long to recover my focus as I spend on maintaining it.

Is that statistical proof that rather than working seven hours and getting a one hour lunch break, I should go home after working one highly focused hour because the same amount of work gets done either way? Right?

Acknowledging that interruptions cost us time is the first step on the road to recovery.

What are some of the solutions we can grab hold of?

An article on rescuetime.com says to “schedule your interruptions”. Even though it might not work to set your kids down for the “ you can only interrupt me from ten to noon talk”, setting time aside to anticipate and work on those challenges that cause many of your interruptions, before that happens, makes a lot of sense.

Accomplishing one task at a time and building your focus muscle is at the heart of a New York times article. Several recommendations are given as to programs or apps that are available to disconnect us from social or internet temptations. They basically “distract the distractors”.

Whether in real estate or in life, it is those things we let distract us, that stop us from getting the house that we want or achieving the goals we set.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


Which Housing Bubble Is About To Burst – PR005 Transcript



Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

The Transcript version contains links to all we talk about.

Many non-resident Foreigners are now banned from owning property in New Zealand. This has come as a response by Parliament to the Housing Crisis that has seen a 60% annual increase of values across New Zealand and an almost doubling of prices in Auckland over the last ten years.

The Australia real estate market finds prices being reduced in five of it’s eight capital cities. The ratio of housing prices to disposable income has increased from 2x around 1980 to about 5x now.

In 2008 as the U.S. was headed into a financial abyss, Canada moved along hardly missing a beat. Here is an article explaining some of the why behind the stability Canada experienced.

Contrast the previous article that talks about the 180 years Canada has avoided a financial crisis, with a BetterDwelling article referencing the view of Canada’s housing market from China. It pointed out that Canadians lead the race in G7 countries for debt to income ratios. It is currently at 165%, which is even higher than the US ratio of 147% at the time of the US Financial Crisis in 2008.

Some say the Canadian Real Estate Bubble is about to Burst. Learn why, including the fact that 47% of Canadian mortgages have interest rate resets coming next year.

Speaking about the U.S. real estate market.

If you wanted to invest in real estate but don’t like the day to day involvement and want more liquidity than outright ownership, you could consider a real estate investment trust or REIT. Even if you are only thinking about investing, you can still get great information about return on your investment and what the public’s attitude is toward various forms of real estate.

Seeking Alpha has a great article with all the charts and graphs the most data hungry of us would enjoy. It not only covers residential real estate but also such things as office, retail, industrial and self storage to name a few. Break out reports on individual sectors such as manufactured homes are referenced. Record high occupancy rates are one of the positive topics covered.

What else are people saying about the U.S. housing market? The Lombardi Letter focuses on higher interest rates, the slowing housing market, and builder’s that are starting to worry.

For an upbeat view of the U.S. Market, read this GordCollins article that discusses how over half of all U.S. home values have rebounded to pre 2007 levels, home sales increased by 9%, and it’s description that “the US housing market is stable and optimistic — backed by a strong economic forecast.”

So, what state is one of the most affordable to live in? Can you guess?

The answer is…West Virginia. The cost of living is 5.6% below the national average and the cost of housing is 38.5% below the national average. For first time home buyers by state, it ranked number 2. See where your state ranks.

Let’s take a brief look at the Portland Oregon and Vancouver Washington real estate market. In July, year over year, Vancouver and SW Washington saw an average sales price increase of 10.3% to $383,000. whereas the Portland Metro only had a 6.4% increase but a higher average at $442,800.

There is one other dramatic difference between the two states separated by the Columbia River. The Vancouver and South West Washington area has more proposed or
“not yet under construction” homes listed in the RMLS system than any of area it covers.

You can click on the links for more details than one cup of coffee will keep you awake for.

Just a reminder that behind all of this information and statistics are people. People who worked hard to be able to buy a house. People who struggle with the high cost of having a family. People who are retired and face an uncertain future.

There are also people who have equity and cash available when they sell, that they would not have been able to save any other way.

Real estate can be a small part of a persons life yet have the potential to be the ship that sinks their finances or the life boat that keeps them afloat.

I could usually tell when a “how to buy real estate and make a million dollars with none of your own money” seminar comes to town. There would be an uptick of people asking about property for sale, not taking the time to talk to a bank or to begin to understand not just the benefits of owning a home, but the cost of home ownership and the risks involved.

Why is that? What would cause thousands of people to flock together for an investment seminar? Or to stand in line, not to buy a house to live in, but to buy a house with the intent of reselling it upon closing?

As a real estate broker, I first got into real estate because I wanted to learn about buying and selling homes, about investments, so I understand the attraction.

What I am talking about though, is more of the “herd mentality”.

There is an old TV show called “Candid Camera” This video clip was taken in the 1960’s and shows us, in a comical way, the influence of group behavior with something as simple as the direction we are facing in an elevator. What direction would you face?

You can watch a similar, more current video clip from a TV show called Brain Games. If you were in a waiting room, waiting for an eye exam, would you stand up just because others in the room did?

If I was at a restaurant and it was on fire, I am all for everyone following the crowd, getting out of the building, and saving lives.

Here is my question.

Once local media publishes a few articles about how the real estate market is shifting, how it is no longer a seller’s market, and how prices are no longer going up, an interesting thing happens. The basic truth of a slowing market becomes a self fulfilling prophecy to everyone who reads the article. If the market is slowing maybe I should offer far less as a hedge against dropping prices. Should I wait to buy a house until prices become way more affordable. How far down will they drop?

The answer to these questions may be yes, or may be no. You should look at your individual situation and see what works best for you. If interest rates went up, how would that affect your buying power? One price range or area of town may not be impacted the same way as another. If you want to live in an area where major positive improvements are being done that will create more demand, would now be a better time to buy or not?

What about selling? You may feel the pressure to sell before prices decline too much. Maybe you should. On the other hand, there may be other factors affecting your life that are more important than which direction the real estate market is going.

Whether in real estate or in life, getting the facts and making informed decisions that work best for you, is the key.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


The French Rivera and Spaghetti – PR004 – Transcript



Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

You can also go more in depth by clicking on the links in this Episodes Transcript.

You have some money and are trying to decide where you might get the highest return on it if you buy a rental property. Now, where in the world would you go? What Country would you choose?

Can you guess who number one is? The Philippines with a 6.13% rental yield.

Canada comes in at number 17 with a rental yield of 3.9%. Learn about the other 23 cities from this Business Insider article.

When you think of the French Riviera, what comes to mind? Your last vacation? The Mediterranean Coastline? A movie set on the French Riviera? How about home ownership where 25% of the buyers are British, 20% French, and the balance from a host of other countries. This may be in part because France has no restrictions on foreign buyers other than the amount of time spent in their second home.

Want to buy a home in South America? How about Panama? Kent Davis is an agent in Panama and he has some excellent words of wisdom for you if you want to buy a home there. One piece of advise is the concept of time. That new construction home just might take a couple of years rather than the one to one and half years you are quoted. Who should you trust. How many ways can you be taken advantage of? Should you believe what you are told?

What are the most popular homes in the U.S. people bookmarked or saved during their searches? Trulia pulls back the curtain so you can learn more about these homes, whether the $71,534. home in Hunstville, Alabama or the $10,750,000. home in Washington D.C.

Prices Reduced in Sydney Australia by 4.5%. An article in Forbes explains why the Australian real estate market is declining, including the fact that 40% of all mortgages are interest only.

Let’s talk about real estate in the State of Montana.

You might consider the two ranches offered by Mort & Donna Fliescher for $50 million dollars. Of course only 7,000. acres of those acres are located in Montana.

Montana is the fourth largest State in the U.S. yet only has a little over a million people.

With good appreciation and mortgage delinqency rates two thirds of the national average, there is a lot to like here. With it’s “A” rated schools Bozeman is the top place in the state to live as well as one of the top 100 in the nation.

Billings, the largest city in Montana with a 2016 population of just over 110,000 has seen values increase 95.67% between the first quarter of 2000 and the first quarter of 2018.

Going west, what is happening in the Portland Oregon Vancouver Washington area?

A new record has been set for the most paid to buy a home in Portland’s Multnomah County . The Eastman-Shaver house in the west hills of Portland sold for close to $7,000,000. Learn more about this Mediterranean Style home. You might ask, “Just how much are the Property Taxes on this home?” The answer: A mere $65,000. per year.

Can you break a piece of raw spaghetti in two?

What typically happens?

When you bend the two ends and the piece of spaghetti snaps, it will in most cases break into three pieces.

Why?

That is the question first asked by physicist Richard Feynman and explained by two French physicists who received a Nobel Prize in 2005 for their theory.

The initial break would cause a “snap back” effect which would travel along the piece of spaghetti. It was how the spaghetti would fracture.

Two MIT students just became the first to be able to consistently break those pieces of spaghetti into two pieces after building upon the mathematical model of the French physicists.

What does spaghetti have to do with anything other than a great meal?

It could have a positive impact on a better understanding of steel struts used in buildings and bridges.

I think there is also an analogy here as it relates to real estate negotiations and personal disagreements.

We need to learn how to stop fracturing relationships and negotiations when we are at different ends of the proverbial piece of spaghetti.

We need to realize there is a point at which expectations snap and the negotiation process can be slowed down or abruptly ended.

It is only as we decide to stick together toward a common goal or understanding, that we are thrown into the pot of boiling water, become flexible in our attitude, and often come full circle so that the ends of the warm pot of spaghetti pieces are not so far apart.

How do we know when the spaghetti or negotiations are successful? I was always told to throw a piece against the wall and if it sticks, it is ready. I guess the same might be said for negotiations and interaction. When both parties have come together, softened their positions, and come to a mutually acceptable position that sticks, it is time to have some dinner.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.


One Persons Trash is Anothers Island Home – PR003 – Transcript



Tom, here.

This is Price-Reduced.com where we talk a lot about real estate and a little about life.

The transcript provides links for you to go more in depth on the topics covered here.

There is only so much land on this earth so what other options do we have?

No Land? No Problem? Will technology save the day when it comes to a land shortage? There is an off the grid floating home a Canadian Couple spent twenty years building. You will find one person’s trash is anothers floating island home as shown by British Artist Richart Sowa. Even though you might enjoy a slide show video of Amazing Floating Homes, can floating homes really solve any of societies problems? Amsterdam came up with a plan to help alleviate their housing shortage by building floating homes.

What shows up in the World News for real estate?

CNN has a great article about the rising prices and the strong real estate market in Europe. Prices in Madrid have risen 10% and Dublin has seen nearly 12% increase in the first quarter. Another trend? Younger buyers are choosing smaller cities where they feel they can get a better quality of life.

One area where prices continue to be reduced is in the Countryside of Italy. Global Property Guide has an in depth article about what is happening in Italy’s Real Estate Market. With interest rates as low as 1.92% earlier this year, wouldn’t you expect a housing boom? Learn what is holding back a boom from happening in various parts of Italy. Keep in mind the number of owner occupied households they have. Would you guess it to be 60%? 70%? Maybe 80%? If you have to guess. Guess on the high side.

Have you ever thought about what the home ownership rates are in other countries around the world? There is a Wikipedia article that might surprise you.

Everyone strives for home ownership, right?

There is an article in Business Insider entitled “I’m a financial planner — here’s why I won’t buy a home” The author doesn’t say he wouldn’t invest in real estate. What he does say is that he won’t own the home he lives in. It’s an article worth reading.

Kind of unusual that someone would choose not to be a home owner isn’t it?

Maybe not so unusual if you lived in Germany. Although home ownership rates in Spain and Ireland are in the eighty plus percent range, Germany is on the other end of the scale for European Countries at about half that, or forty one percent. Why choose to rent over buy? Banking requirements for home ownership and government regulation may play a part in the decision and satisfaction with renting.

Did you know there is the “Organisation for Economic Co-operation and Development” or OECD. It has a Better Life Index where it focuses on housing, education, jobs, and even life satisfaction across many countries of the world. Don’t visit this website unless you also want to learn about Work-Life Balance.

What is happening in the U.S. in the area of real estate?

Let’s look at the State of Florida.

If you are looking for an entry level Luxury Home in Sarasota County, you will pay 19.7% more than last year, That is the highest rate in the nation for the twenty fastest growing Luxury Markets studied.

Ever wonder what your real estate agent does on their off time? Donna Kalil spends her time off capturing Burmese pythons as part of a Python Elimination Program by South Florida’s Water Management District. Her largest? About twelve feet long.

Take 10,000. neighborhoods across the United States, focus on six factors including appreciation, crime, schools, and unemployment, and what do you find? You find that the Pine Ridge Neighborhood in the Naples Florida Metro area is the 10,000. to 1 favorite.

Did you know that Florida was number one of the top five states for Foreign Investors according to the National Association of Realtors?

Let’s go from the southeastern United States to the Northwest United States, the Portland Oregon Vancouver Washington Metro area.

Oregonlive has a great article about the 10 Portland-Vancouver neighborhoods where prices reduced over the last year. To put it a little more accurately, the median price declined year to year for the second quarter. The area with the biggest drop? The 97202 zip code which includes the Sellwood, Moreland, and Richmond neighborhoods where the median price declined 10.2%.

Can’t look at what has gone down without wondering which neighborhoods are the most in demand. The top two are North Aloha or 97003 zip code and North Hillsboro or the 97124 zip code, which is also the location of the 2018 Northwest Natural Street of Dreams.

That is a good reminder that no matter what city you live in, your homes value and amount of demand for it, can vary from neighborhood to neighborhood for the same size and quality of house.

Have you ever watched a time lapse of a water lilly opening and closing? Quite a beautiful site.

Some of us are so focused on what we see on the surface of the pond, we don’t begin to think about all of the plant and fish life underneath it.

There are variations of thought provoking stories about the lily pad.

If you had a pond with one lily pad in it and every day the number of lily pads doubled. At the end of 30 days the pond is completely full. The question is, how many days into the month are you when the pond is 1/2 full? As you might has guessed, the answer is not half way through the month which would be fifteen days.

The next question might be, if you were driving past that pond, on what day might you realize that the lily pads were there? Let’s say it is the 28th which is when the pond is 1/4th full. That leaves us plenty of time to correct the lily pad problem, right? After all, 75% of the pond is unaffected. However, 28 out of 30 days means about 93% of our month is gone, over. That leaves us just 7% of the month to take corrective action, even though only 25% of the pond is covered with a problem.

Maybe that is one reason why , whether in real estate or in life, it makes sense to solve problems when they are small.

Thank you for listening to Price-Reduced.com and always remember, financially speaking, “When it comes to real estate, the best time to buy or sell, is when you don’t have to.