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.