Kalamazoo, MI

The retail sector is making big noise about the lack of spending. The market reports a slump in consumer spending.

How is your Christmas budget? I have taken very little time to consider the national impact on retail sales. I have been more concerned with the people around me and those that are working to make ends meet.

This is a very difficult year for many families. Michigan has it's own issues with the automotive related industries and the national economy has impacted the big office furniture manufacturers located here too.

I would think that Georgia carpet mills and slowing, the North ans South Carolina residential furniture makers are also slowing as home sales slump.

We don't have to discuss the auto makers in Michigan they have made their own headlines with bailout money.

Christmas budgets are sometimes maintained even in tough times. Why? It makes us feel good to give to those we love.

It makes sick and upset when we get the bill in January as the credit card bills come rolling in.

So how is your Christmas Budget?

Our local paper published a obvious article concerning the number of foreclosures. The real reason for the article was two fold.

1. One to sensationalize the current real estate market in our area and sell more papers.
2. A genuine informational guide to scare the hell out of sellers that don't have a foreclosure.

The fact that two out of every three sales is a foreclosure should not be a surprise to anyone in our market. All you have to do is look at the sales statistics, which are public record and available on our local board site.

Traditional seller are going to have to do a bit more staging and make sure the buyers they attract are real buyers for their property.

Agents are going to have to do a better job of screening as well to make sure the buyers are really qualified for the price range they are looking to purchase.

Sorry but not every home is a distressed sale or foreclosure. With that said, the value of all homes in this market have dropped in value. That is not something anyone takes lightly but the other issue is the homes that are in great condition, priced competitively and located where the buyer wants to live still are selling.

We are still seeing traditional sales accounting for 40% of the total sales. That may not be a big number but if you target the right buyers for your property you still can sell.

Agent selection and marketing plans become a very critical factor.

The Michigan market take an experience professional, but that can be said for many markets around the country at this point.

What is your best guess of when the market is going to turn around. I personally do not buy into the 3rd quarter of next year as is being tossed around by the media. That may be for segments of the market.

We have a tremendous number of homes to clear out before we can see a change in the real estate market.

So what is your best guess for the market to turn?

In today's market the reality of many sellers becoming landlords instead of sellers is happening more and more. Why would you sellers turn to this alternative?

Pretty simple they have not been able to sell and they have two mortgage payments. Even the most wealthy among us will reach a threshold of spending before they make the decision to rent.

Sometimes the rent does not cover all the costs of the mortgage but at the same time it costs more than if they kept on the same path of pulling the second mortgage from savings.

We just had an article published concerning this very subject in our local paper. It is evident even with help from the Rental Property Owners Association and the input by the local Real Estate Association the writer was not very familiar with the subject matter.

The best thing the article pointed out was to join an association so you could find out information on how to be a landlord and not violate tenant rights. Many cities and states have specific guidelines on how-to deal with tenants and give them rights that most first time landlords with not have one clue how to deal with within a lease. The lease is another area where many will not know how to form a proper lease to protect themselves or their property.

The selection process of interviewing to find a tenant is another area that can be fraught with issues if not done property. All of these issues can be reviewed and even help found through local Landlord associations.

Doing the background checks, the credit checks are going to give you nightmares in this economy. Consider the rental market with the number of people being foreclosed and losing their homes to short sales. How do you tell the good from the habitual losers? There are ways and many first time landlord learn the secrets of rental success the hard way.

How many of your sellers have turned into landlords?

If you've dreamed of owning a home, recently enacted legislation offers a valuable incentive.
The legislation provides a tax credit of up to $7,500 for first-time home buyers.　

"This might be the opportunity of a lifetime for some first-time home buyers," said Scott Hudspeth of Amerifirst Home Mortgage. "But buyers should note that there are time restrictions on this offer."　

Only homes purchased on or after April 9, 2008 and before July 1, 2009 are eligible. The opportunity is available to anyone who has not owned a home in the previous three years. Here are some additional facts about the legislation:　

A tax credit is an exact reduction in what the taxpayer owes. A taxpayer who owes $7,500 in income taxes and who receives a $7,500 tax credit would owe nothing to the IRS. If you usually get back $2500 you would now receive $10,000. This loan is paid back at tax time the following year at 6.6% of what you owe or 500 a year. It is an interest free loan. If you usually have to pay 500 you will now have to pay 1,000.

Scott Hudspeth
Amerifirst Home Mortgage
www.scotthudspeth.com
scott@amerifirst.com
269-488-9530

I would like to introduce you to the REAL BANK OF THE PEOPLE: The United States of America. Let's take a look. Through our tax dollars we now owns most of Fannie Mae and Freddie Mac and their $5.2 trillion in guarantees/portfolios. WE owns 80% of American International Group's $70 billion or so in "credit default swap" contracts on subprime bonds. (This is not a good thing to own.) WE also own 80% of AIG outright (a $1 trillion company) including a once-top-ranked mortgage insurer, United Guaranty. WE own AIG's two mortgage banking subs, which were shrinking anyway, (not a big deal in the scheme of things.) WE own $30 billion in Bear Stearns' risky bonds. Meanwhile, Congress, Treasury and the Fed's Ben Bernanke are going to write legislation to create a "Mortgage RTC." This strain of the RTC will buy mortgages and bonds no one else wants. Now that WE own Fannie and Freddie, can WE call the shots on foreclosures? You guessed it: Nope! Not on your life! You would probably fire your investment advisor for putting you on the hook and in the tank for all of this debt right? So Wall Street must think that Congress and the Government are nuts right?! WRONG! Thursday and Friday the Dow Jones shot up almost 800 points! Of course, the ban on short selling probably helped a bit.

I just have to wonder how supposedly we have the world's best economic structure regarding capitalism...and yet what is OUR taxpayer dollars going towards? Not education, health care, or job creation...bailing out companies who's "invicibilities shone brighter than the sun in California." Or were they part of the "get extremely wealthy quick schemes?" I'm just curious about one thing though...is the US Government or my state government going to buy me out for millions and billions of dollars if I make a financial mistake running my business? I guess I now have two questions: how can we go overseas and teach other countries our way of global economics as the only way...when obviously our system can't completely handle the race to invent the new global economy itself?!