The Dale Team Blog

Why Should I Buy Now?

2009-04-01T16:25:00.000-07:00

Why should I buy now?

Any investment consideration, whether it be real estate, gold, or fine art, follows a predictable cycle with nine stages "The Stages of a Market Cycle." Let’s start with optimism, the period in which many people are excited about buying a home. When the market is strong, people’s purchases quickly increase in value, which leads to euphoria, which can lead to rash decision making.

From euphoria starts a downward cycle. As prices start to fall, buyers go into denial, with statements such as "I’ll be in the house a few years, so this won’t be a challenge." After denial comes fear, as prices continue to fall, followed by panic, despondency, and depression. After depression comes hope and then optimism (back to stage one).

The point of maximum risk for any investment is during the euphoria stage. The point of maximum opportunity is at the lowest point, between despondency and depression. That’s exactly where we are in many real estate markets today. Clients who are motivated and qualified to buy will be able to look at the market cycle and understand why now is the best time to invest in real estate.

Call us...we can give you the details you'll want to make a good decision.

How to Survive in Today's Real Estate Market

2009-03-31T15:44:00.000-07:00

I'm sure you've heard the news that now Phoenix has been named the city with the biggest drop in home prices,,, some 47%! How do we as agents survive?

Lately I've noticed that there are a lot of depressed people all around me! The "hard luck" stories keep coming with a vengeance so I've been thinking about this and what we can do to survive during this time.

1. Postive thinking just isn't working for me so I'm resorting to.....eating cookies!

2. Since I'm eating the cookies I'm exercising more which in turn is good for my health.

3. Since I'm exercising more I'm drinking more water which is certainly good for my skin and general health as well.

4. I'm surrounding myself with positive things....like my dog! Have you ever noticed how good a life your dog has? Many times I've wished I was my dog owned by me! I love watching his ears flop as he joyfully plays. I also love being with my grandchildren (9 of them!). Have you noticed that children are oblivious to this economic downturn? Children can offer great happiness and joy if you just watch them and see the fun they have as they play.

5. Prayer has been helpful but many times I don't feel like He is answering although I'm sure He is! Anyway, it's good just to "get it off my chest!"

I know the "glass half full, half empty" stuff; " "Have faith, the market will turn deal;" "This is the market millionares are made in line;" and on and on. I guess for me to make it through this downturn as an agent I need to concentrate on learning new things; I can't be "stuck" in the old way of doing things. I need to solidify my relationships with my husband, family and clients. Even though I'm working harder than before (and making less money!) I need to take time off to enjoy life. It passes by so quickly. I don't want to miss those simple things by concentrating too heavily on the things that really won't matter 100 years from now!

Good luck in your journey!

Dare to Fail

2008-08-04T12:20:00.000-07:00

My nephew, Ryan sent this to me and it is so pertinent right now I had to share it with you.

Had to share it in case you missed it.

I read a great quote in a Guidepost the other day that said, failure
is only permanent if you give up and quit....and then this morning,
the CBS Morning show covered the very same topic....I felt a need to
share so I hope you don't mind ;-)

I urge you to go out this week, this year, this lifetime...and dare
to fail....for it's through our failures that we learn, we grow, we
become......

Did you know the billionaire author of Harry Potter was practically
penniless?? I've added some of the examples of people who failed big
time, but are now on top.....May your failures take you places you've
only dreamed of.......God bless....Ryan

____________________________________________
(CBS) If at first you don't succeed, the saying says, the thing to do
is not give up, but try, try again. When people tell you you should
quit, but you don't want to stop, just think about the stories of some
people now on top

Sometimes when things fail, they were simply ahead of their time. Did
you know the fax machine was actually a failed invention in the 1840s?

The copy machine was invented in 1937, but the idea was rejected by
the likes of GE and IBM. It would be 10 years before Xerox's machine
would make its debut.

And the Apple Newton - the first handheld PDA - was a flop, but its
innovations can be seen today in the wildly successful iPhone.

John Grisham, whose first novel was rejected by a dozen publishing
houses.

Henry Ford, who went bankrupt 5 times.

More "failures": Artist Vincent van Gogh, who sold only one painting
in his lifetime ... Orville Wright, who was expelled from elementary
school ... and the Chicago Cubs, who haven't won a World Series since
1908 (and they haven't played in one since 1945).

Is Atlanta Braves third baseman Chipper Jones a failure? Surely not:
his .369 batting average leads the major leagues by a significant
margin, yet that means he's making outs - failing - more than 60% of
the time

And so it goes ... Michael Jordan failed to make his varsity
basketball team ... Oprah Winfrey failed as a news reporter ...
Winston Churchill finished last in his class.

Failure puts you in pretty good company ... company that includes
J.K. Rowling, the world's first billion-dollar author. The creative
wizard behind "Harry Potter," the most successful novel series in
history, who made failure the topic of her speech to this year's
Harvard grads.

"A mere seven years after my graduation day, I had failed on an epic
scale. An exceptionally short-lived marriage had imploded, and I was
jobless, a lone parent, and as poor as it is possible to be in modern
Britain, without being homeless," she said. "And so rock bottom became
the solid foundation on which I rebuilt my life."

Perhaps, then, there is never a reason to fear failure. Instead, as
Rowling might suggest, we ought to embrace it.

"It is impossible to live without failing at something, unless you
live so cautiously that you might as well not have lived at all - in
which case, you fail by default."

Brief History of Real Estate

2007-11-06T17:21:00.000-08:00

Brief History of Real Estate

Historically, housing downturns average 27 months. We are in the 23rd month
of the current downturn, so

once we are past this financial over-reaction, things should improve. The
national median price of a resale home is 3.4% higher than a year ago and the pending sales index is moving back up.

There may just be some light beginning to shine at the end of this tunnel!

1970 to 1980

Prior to my entering real estate in 1971, a quote appeared in Business Week
(late 1969) due to an increase in housing prices:The goal of owning a home seems to be getting beyond the reach of more and more Americans. The typical new house today costs about $28,000. In 1972, interest rates were 7% and it

would take over 24 years before a home buyer could be able to obtain those
low rates once again - today, we are in the low 6%. In 1973, banks had a run on deposits and for a period of approximately 8 months there were no lenders who were in a position to make loans to home buyers.This should have caused a collapse in the real estate market, but home prices continued to rise.

In 1977, the National Business magazine stated: The median price of a home today is approaching $50,000. Housing experts predict price rises in the future won't be that great.

1980 to 1990

At the end of the 70's and into the 80's, inflation hit 21.5% and home
loans were reaching 18%! This was followed by a crash (and later bail out) of the savings & loans industry in America. Although large job losses were creating foreclosures, home prices continued to rise. By 1985, Money Magazine made this
prediction about home prices: The golden-age of risk free run-ups in home
prices is gone.With a buildup in defense spending and huge growth in
manufacturing sector in the late 1980's, increased job creation led to a
boom in home construction and home prices continued to rise. Then on
November 11, 1989, a dramatic event took place: the Berlin Wall came down!
With the Evil Empire (the Soviet Union)breaking up, things were going to change around the world and change quickly!

1990 to 2000

In early 1990, Congress began slashing funds for defense spending. Within a
very short period of time, a lot of highly paid workers in both defense and manufacturing had lost their jobs. California home prices declined about 12% by 1996 when the San Francisco Examiner said: A home is where the bad investment is. In the following 3 years, California home prices rose 19.7% wiping out all the losses of
the early 90's and ended the decade with a net gain of 9.35%. The median
price in California has not declined since 1996.

The Media

Todays media plays up bad economic news now more than ever, which leads to
misconceptions about economic realty. Our economy is extremely strong, profits are superb and the world economy is exploding.

All you read and hear is that real estate is going down, yet
last month, prices in the U.S. rose 3.4% from a year ago and California is up almost 1%. The Bay Area prices have gained 4.1% over the last year and southern California median price is up 3.7%.

Foreclosures are supposed to be at a record high - but last year 98.83% or mortgages did not go to foreclosure. Today, the Bay Area's foreclosure rate is up only 1.5% over last year while southern California's foreclosure rate is up 2%.

The media reported 53,942 notices of default for the 2nd Quarter - a near record high. They are comparing it to the 1st Q. of 1996 when 61,541 notices were filed but fail to mention that 2 million more home have been built in California since
then!

What if the mediaâ?Ts headlines read: 99.2% of Mortgages are Not in Foreclosure? The media and the financial markets have greatly over-reacted, to the real problems that have been revealed in the lending marketplace, which is typical.

The Sub-Prime Market

It may surprise you to know that sub-prime loans make-up only 5% of the
U.S. total loan market and Alt -A loans (those with credit better than sub-prime but less than prime) total only 8% of all loans in the U.S.!

1. These exotic loans became a major influence in the early 2000's, but
anyone obtaining them up through 2004 had very few problems due to rapid equity growth. Many with no-money-down purchases soon found they had 20% (+) equity within a year or two!

2. Most of the problems with sub-prime loans originated in the summer
of 2005 through 2006. In California, 43% of all loans funded during that time were sub-prime loans.

3. Sub-prime loan investors that needed to sell their loans were
liquidating their paper for $.96 on the dollar. There has been no current data on sales since August 5th, but with the current turmoil in the financial markets, I am sure they are being dumped for less.

4. Here is a financial report on some of the banks that provided the
sub-prime money: Bear Stearns 2nd quarter revenue was $2.512 billion - a new record!
Merrill Lynch saw 2nd quarter profits rise 30.2% Morgan Stanley (holding
$5.2 billion in subprime loans) had a 60% jump in earnings.Goldman Saks earned $2.33 billion in the past year. Bank of America (#2 U.S. bank), after putting aside $1.81 billion for potential credit losses, saw net income rise to $5.76 billion - up from $5.48 billion last year.

The media will still report about massive delinquencies and huge
foreclosures in the sub-prime market,but those reports will not be accurate because they don't explain the difference between a delinquent payment, a notice of default or a foreclosure. They tell us Foreclosures at Record High! But that is not
accurate. Source: Mortgage Bankers Association, National Homebuilders Association,
Inside Mortgage Finance

Delinquencies vs. Notices of Default vs. Foreclosures

Delinquencies
Delinquencies cover any missed payment - even if it is just for one month,
it is reported as a delinquency.

1. The delinquency rate on sub-prime loans was running at 13.77%, which is
up 13.44% from the previous year. In the last quarter, the delinquency rate dropped to 12.4%!

2. The delinquency rate on Alt-A loans is only 2.69%, while prime loans are
at 2.57%.

3. Combining the three rates with the loan volume gives you a delinquency
rate for all loans in the U.S. of only 4.84%. The record low is 4.0%.

4. On jumbo mortgages (anything larger than $417,000) the delinquency rate
is 0.37% 5. California's delinquency rate is only 3.25%.

Notices of Default

Notices of Default are filed when lender's loans have been delinquent for a
specific period of time. These loans begin the foreclosure process. The four states of California,Florida, Nevada and Arizona currently have the largest amount of loans in the foreclosure process. Yet, in the 1st Quarter, 24 states saw a decline in foreclosure starts and 36 states saw a decline in the 2nd quarter!

1. Only 3.23% of all sub-prime loans have entered the foreclosure process,
with most of the defaults occurring on loans from Jan. 2005 to June 2006.

2. Only 1.28% of all prime loans have entered the foreclosure process.

3. In California, the last quarter saw 53,943 notices filed, with most
filings being on loans from the summer of 2005 to the summer of 2006.

4. The lowest number was 12,417 in the 3rd Quarter of 2004.

Foreclosures

Foreclosures occur when the buyer has been unsuccessful in curing the debt,
and either a lender or an investor has acquired the property. As of last month, there was 1 foreclosure filing for every 693 homes in America.

1. For sub-prime loans, 68% of the buyers are able to prevent the
foreclosure by either refinancing the property or successfully selling their home.

2. For prime loans, the foreclosure rate is 0.86%. Last year, the U.S. saw
a combined foreclosure rate of only 1.09% while California's rate was 1.17%!

3. California now ranks #4 in the nation in foreclosures - down from #1!

The media will try to scare you with numbers like $1 trillion in loans
needs to be recast this year and that foreclosures could cost lenders as much as $2.3 billion dollars! They never mention that there is $10.4 trillion of mortgages with $56 trillion dollars of equity in American households.

Add to that the wealth of the U.S. at $70 trillion, with the value of
stocks between $15 and $20 trillion, while the bond market is even larger. So these loses (should they occur)should not have any great effect on home prices.

A final note about foreclosures: The #1 reason they occurred was due to
fraud. The #2 reason was unethical lending, followed by #3 - loss of job, and finally #4 was medical reasons. By the way, mortgage insurers are in a good position to cover losses at these (high)levels.

Source: Mortgage Bankers Association, Federal Reserve, Federal Bureau of
Investigation

Why the World Changed in 1979
Baby Boomer's Impact Never before in the history of the world has a generation accumulated so much wealth as the baby boomers. The Internal Revenue Service will tell you that from 1945 to 1979, incomes increased at the same rate for all tax brackets. By 1979, the early baby boomers had been in the workplace for over 10
years. They were the most educated generation to enter the work force, and
they had the skills for our changing world. Today, the IRS tells us that, from 1979 to 2004, the median income in the U.S. rose 18%. From 2004 to 2005, incomes grew 5.8%. The number of taxpayers making more than $100,000 grew by 3.4 million and
accounted for more than two-thirds of the growth vs. 2000! Half of Americans make less than $30,000 and two-thirds make less than $50,000.Those making more than $1 million grew by 26% and numbered 303,817 in 2005!These individuals,who constitute less than a quarter of 1 percent of all taxpayers, reaped almost 47 percent of the total income gains in 2005. The top 85% of the nation's wealth resides with the richest 15% of Americans; the bottom 50% of Americans holds only 2.5% of the nation's wealth. Over the next decade, there will be a 25% increase in the population over 50 years of age. They have more money than any preceding generation, due to having dual incomes, equity growth, and record inheritances (60% goes to the top 40%)! This age group is spending $2 trillion dollars annually! Last year, 2.1 million boomers turned 60, with 25% planning on not retiring. They found a way to mix leisure with work and are not ready to fully retire - they have money and income and they are still investing in real estate.

The weather is cooler....life is good!

2007-10-15T16:58:00.000-07:00

Today was just an incredibly beautiful day! I had the windows open all day without having to use the air conditioner! At last....maybe fall has arrived in Arizona. What's happening is real estate? We've seen a slight increase in activity this last week. We sold 2 of our listings and rented 2 rental listings. If you currenlty are trying to sell you home...hang in there! A few things to make sure about though:

Is it priced very competively?
Do you have great curb appeal?
What appealed to you about the home, does it show at its best?
Is your home spotless? Make sure the windows sparkle
Is there an exceptional feature about your home that you can emphasize?

Do you need a very experienced team to help? Call us!

NEW SIGNAGE LAW

2007-09-21T09:00:00.000-07:00

So what's the big deal, right? A new law was just passed dictating that Home Owner Associations can no longer prohibit signage in any community. What this means is that if you're in a community where signage was not allowed, you will now see big white signs popping up on every listing. EXCEPT....FOR The Dale Team listings! We've decided to take the "high road" and use minimal signage instead of those big 18 x 24 inch signs on the big white posts. We're home owners in those communities where signage has been limited too and understand that all those big white posts destroy the beauty of the community. So, think of us for your next real estate need for yourself or someone you know understanding that we have YOUR best interest in mind!

The Survey Says......

2007-09-17T06:11:00.000-07:00

...owners think their homes are worth more now despite the big downturn in the housing market? Fifty-Five percent of Americans think they could sell their houses for more than a year ago...and 63% continue to believe that real estate is a good or excellent investment.

Survey of 1,007 US adults by The Boston Consulting Group.

9/11/07

2007-09-11T17:31:00.001-07:00

Today I'm sure we all remember where we were 6 years ago. I just got home from the gym and couldn't believe what I was seeing on TV at the World Trade Center. The few months after that terrible event caused me to re-evaluate what is most meaningful and important in life. Today as I reflect....that hasn't changed. Even in the busy "hurry-up" world the things that really matter to me are 1. My Faith and 2. My Family! Thank you to our real estate family for being so supportive all these last nearly 16 years now! We look forward to what's yet to come.