Murrell Weissinger

March. 2009

Hello buyers, sellers and everyone interested in the real estate market, from Murrell Weissinger! I am a 24/7 realtor working from the Watson Realty Corp.'s St. Augustine Beach Office.

For more than two years the real estate market has been, to say the least, disappointing at first for those who expected to 'flip' profitably, and later for owners who saw the sale value of their homes cut, in some cases as much as 40%. There was a moment, mid-summer, '06, when there was hardly any sales volume- except for the developers who cut prices to move their newly completed homes.

The coordinated efforts to manage the sub-prime crisis, the trillion dollar 'rescue packages', as well as vast US and international cash injections to assist bank lending, should, eventually, filter down positively to real estate market. In addition, there are efforts to limit the impact of resetting mortgages without giving a 'freebee' to predatory lenders. For those in danger of foreclosure there is now a short breathing space to give lenders and owners an opportunity to work together to avoid immediate foreclosure. The 'bonus rebate' to boost the economy by giving taxpayers a present could very well have helped Wal-Mart's balance sheet, but not much else! The problems coming from the big banks 'getting stuck' with subprime mortgages is still with the housing market causing a general restriction in their loan criteria. Bank of America's relation to their newly acquired Countrywide (mortgage lender) seems not to have loosened purse strings but rather have tightened them with Countrywide letting many of their agents go. The US takeover of the two huge mortgage companies Fannie, and Freddie, the crash of Bear Stearns, and Lehman, the sale of Merrill Lynch, and the massive government entry (albeit reluctant) into the world insurance market via AIG, have kept the Federal eye on damage control rather than a restructured future, although this seems to be ‘in the works'. World central banks have injected many billions of dollars to improve bank equity-debt ratios so that they will return to normal lending practices. This potential for improvement can be seen in the decreased LIBOR rates.

The problem of both brokerage houses and banks, apart from their need to shore up their equity to debt ratios at the cost of stockholder dilution, has been the difficulty in valuing their portfolios of mortgages in a still falling market. Once home prices stabilize, that worry will be over. Meanwhile, the ratio of new listings to closings, in my area, has at last started to improve from the previous 5:1 to closer to 4:1. The willingness of the Fed to protect liquidity is encouraging, and may give buyers more confidence to come into the market. I, personally, am experiencing new buying interest both from 'bottom feeders' and from the re-emergence of normal buyers who have apparently been holding off until now.

For those owners whose 'teaser' mortgage rates are are now at a much higher interest, the 'refi' market should be an attractive alternative now. On the plus side, recent arrangements to monetize triple A rated mortgages under the auspices of the Federal Reserve should improve the major banks' ability to lend, and show a clear way out of the mortgage morass! Bill Watson, Chairman and founder of Watson Realty Corp, this will be a good year to buy. Personally, I am seeing reasonable mortgages being extended upon positive appraisals for my buyers. Since January I have been experiencing a substantial increase in business. The pundits of Homes and Land agree with Bill Watson- I quote: 'Real Estate Outlook: Bottom in Sight?
by Kenneth R. Harney, Realty Times
Signs of a cyclical turnaround for housing are on the upswing. Sales are up sharply in many of the hardest-hit markets, and prices are firming in many others. Last week, Dr. Mark Zandi, chief economist for Moody's Economy.com, surprised analysts by announcing that "the bottom of the housing downturn is in sight for the nation."

The new articulate president Obama is pushing major programs to 'jump start' the economy and to restore confidence. There will be soon be trillions of dollars moving into the veins of the US financial system. I believe that, for those who have been 'burned' by their stock brokers, the residential real estate market, at these depressed levels, should provide an attractive alternative to cash or almost zero return government paper.

I spend a considerable part of my sales revenue on multi-faceted advertising. Sometimes this leads potential customers to misunderstand advertising's capabilities. The same 'sensible' person who gives a stockbroker a market order to sell shares in Google, and, who would never imagine that the 'right' advertising could sell those shares for more than the market price, quite often believes that, in real estate, market forces can be overcome by advertising. Wrong! The skill of advertising is to point out and describe well-priced property to the appropriate buyers. Naturally, the higher the price the higher the commission, but my job is to advise customers which is the best price they can obtain under current market conditions.

The reluctant and tardy price reductions that merely follow a falling market down, are, in the end, very expensive. They mean that maintenance, taxes and interest go on piling up, while the capital which could have been invested from the sale produces no income. I am currently advising motivated sellers to pre-empt the market by pricing at or slightly below it.

DOING THE MATH!

To illustrate the point let us imagine a house that my calculations and 'gut' feeling indicate a selling price of, approximately, $535,000. Taxes, maintenance, community fees, insurance etc are $15,000. There is a mortgage of $400,000 at 6.5% with interest payments of $26,000. Total minimum outgoings are $41,000 this means a monthly 'out-of-pocket' of $3,417. At this 'theoretical' moment cash buys US Government 30 year bonds for a 5% return. So, if the house were to sell promptly at the listed price of $535,000, the owner would receive close to $500,000 net and have $100,000 to invest at 5%, ($417 per month). Each month that the house remains unsold the owner will pay out $3,417 and not receive $417, or total cash loss of $3,834 monthly.
In this example the owner wants to test a listing price of $625,000. After 3 months of no activity, it is reduced to $600,000. 3 months later it goes to $575,000. Then, finally to $550,000 where purchase offers emerge, and after a month it closes at my estimate. The owner, who could have sold it some 10 months earlier at the same closing price has, between payouts and lost income, now only $61,660 from the sale; almost 40% less than if the property had been aggressively priced in the beginning!

Please call me, write me, email me with your real estate questions: Murrell Weissinger,PA

Real Estate Outlook: Bottom in Sight?
by Kenneth R. Harney, Realty Times
Signs of a cyclical turnaround for housing are on the upswing. Sales are up sharply in many of the hardest-hit markets, and prices are firming in many others. Last week, Dr. Mark Zandi, chief economist for Moody's Economy.com, surprised analysts by announcing that "the bottom of the housing downturn is in sight for the nation."

February. 2009

Hello buyers, sellers and everyone interested in the real estate market, from Murrell Weissinger! I am a 24/7 realtor working from the Watson Realty Corp.'s St. Augustine Beach Office.

For more than two years the real estate market has been, to say the least, disappointing at first for those who expected to 'flip' profitably, and later for owners who saw the sale value of their homes cut, in some cases as much as 25%. There was a moment, mid-summer, '06, when there was hardly any sales volume- except for the developers who cut prices to move their newly completed homes.

The coordinated efforts to manage the sub-prime crisis, the $750 billion 'rescue package', as well as vast US and international cash injections to assist bank lending, should, eventually, filter down positively to real estate market. In addition, there are efforts to limit the impact of resetting mortgages without giving a 'freebee' to predatory lenders. For those in danger of foreclosure there is now a short breathing space to give lenders and owners an opportunity to work together to avoid immediate foreclosure. The 'bonus rebate' to boost the economy by giving taxpayers a present could very well have helped Wal-Mart's balance sheet, but not much else! The problems coming from the big banks 'getting stuck' with subprime mortgages is still with the housing market causing a general restriction in their loan criteria. Bank of America's relation to their newly acquired Countrywide (mortgage lender) seems not to have loosened purse strings but rather have tightened them with Countrywide letting many of their agents go. The US takeover of the two huge mortgage companies Fannie, and Freddie, the crash of Bear Stearns, and Lehman, the sale of Merrill Lynch, and the massive government entry (albeit reluctant) into the world insurance market via AIG, have kept the Federal eye on damage control rather than a restructured future, although this seems to be ‘in the works'. World central banks have injected many billions of dollars to improve bank equity-debt ratios so that they will return to normal lending practices. This potential for improvement can be seen in the decreased LIBOR rates.

The problem of both brokerage houses and banks, apart from their need to shore up their equity to debt ratios at the cost of stockholder dilution, has been the difficulty in valuing their portfolios of mortgages in a still falling market. Once home prices stabilize, that worry will be over. Meanwhile, the ratio of new listings to closings, in my area, has at last started to improve from the previous 5:1 to closer to 4:1. The willingness of the Fed to protect liquidity is encouraging, and may give buyers more confidence to come into the market. I, personally, am experiencing new buying interest both from 'bottom feeders' and from the re-emergence of normal buyers who have apparently been holding off until now.

For those owners whose 'teaser' mortgage rates are are now at a much higher interest, the 'refi' market should be an attractive alternative now. On the plus side, recent arrangements to monetize triple A rated mortgages under the auspices of the Federal Reserve should improve the major banks' ability to lend, and show a clear way out of the mortgage morass! Bill Watson, Chairman and founder of Watson Realty Corp, this will be a good year to buy. Personally, I am seeing reasonable mortgages being extended upon positive appraisals for my buyers.

The new articulate president Obama is pushing major programs to 'jump start' the economy and to restore confidence. There will be soon be trillions of dollars moving into the veins of the US financial system. I believe that, for those who have been 'burned' by their stock brokers, the residential real estate market, at these depressed levels, should provide an attractive alternative to cash or almost zero return government paper.

I spend a considerable part of my sales revenue on multi-faceted advertising. Sometimes this leads potential customers to misunderstand advertising's capabilities. The same 'sensible' person who gives a stockbroker a market order to sell shares in GM, and, who would never imagine that the 'right' advertising could sell those shares for more than the market price, quite often believes that, in real estate, market forces can be overcome by advertising. Wrong! The skill of advertising is to point out and describe well-priced property to the appropriate buyers. Naturally, the higher the price the higher the commission, but my job is to advise customers which is the best price they can obtain under current market conditions.
Reluctant and tardy price reductions that merely follow a falling market down, are, in the end, very expensive. They mean that maintenance, taxes and interest go on piling up, while the capital which could have been invested from the sale produces no income. I am currently advising motivated sellers to pre-empt the market by pricing at or slightly below it.

DOING THE MATH!

To illustrate the point let us imagine a house that my calculations and 'gut' feeling indicate a selling price of, approximately, $535,000. Taxes, maintenance, community fees, insurance etc are $15,000. There is a mortgage of $400,000 at 6.5% with interest payments of $26,000. Total minimum outgoings are $41,000 this means a monthly 'out-of-pocket' of $3,417. At this 'theoretical' moment cash buys US Government 30 year bonds for a 5% return. So, if the house were to sell promptly at the listed price of $535,000, the owner would receive close to $500,000 net and have $100,000 to invest at 5%, ($417 per month). Each month that the house remains unsold the owner will pay out $3,417 and not receive $417, or total cash loss of $3,834 monthly.
In this example the owner wants to test a listing price of $625,000. After 3 months of no activity, it is reduced to $600,000. 3 months later it goes to $575,000. Then, finally to $550,000 where purchase offers emerge, and after a month it closes at my estimate. The owner, who could have sold it some 10 months earlier at the same closing price has, between payouts and lost income, now only $61,660 from the sale; almost 40% less than if the property had been aggressively priced in the beginning!

Please call me, write me, email me with your real estate questions: Murrell Weissinger,PA