WSJ article: “Home Affordability Returns to Pre-Bubble Levels.”

This is a great article that really ties into the January Newsletter, that we are in a “normal” real estate market now. We have seen the Huge declines year over year, we have seen the gluttony of foreclosures processed through the court systems According to the WSJ, “Many economists and housing analysts expect an additional decline of 5% to 10% before prices reach the bottom later this year or early 2012.” I would be in the belief Southwest Florida, mainly Cape Coral and Fort Myers would expect to see around 5% declines if any. The article is from a national perspective and real estate is a Local Game, one of which many learned the hard way. If you look at the affordability analysis of homes prices compared to household incomes is at its lowest level of 1.9 in Lee County, which were the values nationally from 1989-2003. Compare 1.9 to the ratio in 2006, it was over 4.5!!! If we are in a normal market now, and your home is underwater, and which is 1/3 homes in Lee County, then you have a difficult decision to make. You are stuck with either paying the mortgage till you move in 10 years. Or you are stuck with this risk of completing a Strategic short sale, which I predicted was going to rule the market in 2010, I believe I was off by 6-9 months with my prediction. Strategic defaults will be occurring at alarming numbers in 2011. What do you need when considering this avenue? You need good legal advice (which doesn’t result in a BK), you need a knowledgeable realtor, and you need an expert negotiator or processor for the short sale process completed through your lender. If we believe the WSJ and that we are at the bottom and prices are affordable, and it will take more than a decade for Real Estate to recover, then the math is simple…pay $24,000 a year for the next 10 years or what would equate to $240,000, or cut your loses now, recover within 18 months some as little as 12 months, and re-enter the market in 2012 when the economist estimate we will be at the bottom. NOW, there are some deadlines to consider, Deadline 1. Dec. 31, 2012 which is when the Mortgage Debt Relief Act of 2007 expires and the loss you incur on a short sale will be taxable. Currently this act allows exceptions for this and makes it a non issue for taxes. Imagine having to pay taxes on a $150,000 loss the bank incurred due to short sale and issues a 1099 to you the home owner…UGH, what pain that would be. We are a qualified Realtor team and have a team of negotiators on hand to complete all our short sales. We have over a 93% success rate for over 5 years or successful short sales. We know we can help anyone in trouble. Our past clients have been, Doctors, Business Owners, Attorneys (yes truly), Mortgage Brokers, Realtors, Professors, Accountants, CPA’s, Pastors, Mechanics, Service industry employees, just to name a few. Don’t forget, we are never to busy for your referrals.

Take time to "Smell The Roses"

Are we too busy in today’s technology driven lifestyle we lead to stop and smell the roses? A funny story of where my father first mention to me that we had to stop and smell the roses. We were at the top of a mountain in Winter Park Colorado, and we were skiing. My father lived in Minnesota and loved skiing and was something he taught us children young in life. All winter we would spend time going up and down the slopes of ski hills of Buck Hill, Afton Alps, Welch Village, and Wild Mountain just to name a few. These hills as many know are a few hundred feet in length and take less than 10 mins to go down. Now being out in Colorado in Winter Park with downhill trails a half mile in length with over a couple thousand feet of elevation gain was a big jump for us. As a youngster I was eager and full of energy. As a father, well, he was a little more worn out lets say. We get to the top of the mountain after many runs of the day, and my dad was tired, but since we are stubborn old Czechs, dad couldn’t say he was tired. Instead he says, we have to stop and smell the roses. HAha, we still laugh about it to this day when he said that. He was quick on his feet with that one. However he was right, we needed to stop and look around and the mountains as the sun glanced off the tops of them. We needed to take slow death breath of that clear air. It was a good lesson in life. No matter how much fun you are having, or how hard you are working, or how fast pace life seems to get. You do need to stop and smell the roses. You need to stop and enjoy mother earth in all her beauty and glory. In Florida, we are lucky to be able to smell the roses year round. Amazingly my favorite smell is the Jasmine, which seems to be in bloom in February and March in Florida. In Florida we have the beauty of white sandy beaches; we have the beauty of all the ocean life. We have dolphins ‘surfing’ the wake of your boat, we have manatees just cruising along the canals almost as if they are saying hello as the past your home. There are beautiful sunsets over the water of southwest Florida. One of the most unique things only the lucky get to see is the Green Flash of the sunset. It happens as it cuts below the waterline of the Gulf of Mexico. In the years I have been here I have only seen in twice, but each time it was pure enjoyment. After reading my blog, turn off the computer, shut down the TV, kill the Radio, and take a step outside. Go for a walk around the block, if you are in the Northern States that just got dumped on with feet of snow, enjoy the beauty it brings. If you are living in the beautiful state of Florida, go enjoy the sunny weather, what ever you do just get out and take time to smell the roses.

$1000 Challenge

I want ideas on how to raise or save $1000 in 30-60 days while living paycheck to paycheck…

If you read as many books on budgeting as I do, you will soon come to understand two constants. One is, you can no longer live off credit cards. I know they make life so easy and you get Frequent Flyer Miles and all, bye the way if you live paycheck to paycheck how are you able to afford to Travel? HMMM If you are traveling on Credit, oh gosh, you gotta stop! Ok so if you are going to throw out the credit cards, by the way Dave Ramsey gives a Trophy once a year to the most creative way to destroy your credit cards, he calls it “Plasectomy” –true plastic surgery. If you are not going to live off of credit cards or you FEAR you need a card in Case of Emergencies then you need the 2nd constant in all budget books. A cash emergency fund ranging from $1000-$3000 depending on your income levels, since most of us have emergencies in the lower range that is where my challenge for the day comes from. You see, we all at one point or another have lived paycheck to paycheck, have rough into a tight financial pinch, many may be there today. If that is the case, I want to show you or give you ideas from the many wonderful minds out there in ways to save money here and there in your daily routine in order to get to the $1,000 immediately. Because lets face it, if you want to own a home or be debt free, you want to start right away and getting the $1,000 Emergency fund is the first step. If you have a way to save $5, $10, $20 or even $50/month, day, year let us know because soon enough it will add up to $1000. Here is one you might have thought about, my friend calls it ‘Eat Down,’ because food is often a beat down on the finances. LOL…Love it, ‘Eat Down’, Ok so the concept is you eat food in your pantry until it is bone dry. You will find that week of food is plan, limited, but Paid for in the past, and could very well save you $100 that week. I look forward to hearing your ideas. Please post a comment below with your ideas. THANKS!!!