With the tax credit extended through April 30th (and close by June 30th) so that qualified first time buyers can receive $8000 back from the federal government AND qualified current owners eligible for a $6500 tax credit, it begs the question, “Where are all the buyers?”

Right now a lot of real estate activity is through investors who are snatching up properties because home prices are low - especially investors who can buy without depending on a bank loan.  However loans are still available for regular buyers, too, at historic interest rates.  (Check the daily interest rates available nationwide here.)

If you feel secure in your job, have a good credit score, and a desire to own a home, remember that money is money.  These thousands of dollars offered as tax credits by Uncle Sam will go away later this spring.  What first-time buyer is not qualified for the tax credit?  Here are some restrictions.  If…

• They buy the home from a CLOSE relative (including spouse, parent, grandparent, child or grandchild).
• They do not use the home as principal residence.
• They sell the home before the end of the year.
• They are a nonresident alien.
• They are - or were - eligible to claim the District of Columbia first-time homebuyer credit for any taxable year.
• Their home financing comes from tax-exempt mortgage revenue bonds (does not apply for home purchased in 2009).

If you’re seeking the $6500 tax credit, remember you must have owned and occupied a primary residence for a period of five CONSECUTIVE years during the last eight years.

Remember, money is money.  If you’re ready, willing, and able to buy right now and qualify, don’t delay if you want to receive $8000 or $6500.

Mobile homes scare me, plain and simple.  Unless you count the invasion of mice when we lived in the country as a problem, our mobile home living when I was a teenager was uneventful.  Yet when you hear about tornadoes, hurricanes, or any kind of bad weather it’s always the mobile homes that are ruined, people hurt and killed.

Today, mobile homes are actually a fairly affordable option for buyers - especially if they can find a home with finished walls and place them on a permanent foundation.  What will FHA and VA approve for permanent foundations?  Click here to learn more.  With the caveat that my information is already outdated, two years ago when I closed on a manufactured home, there had to be 16 tie-downs for it to qualify FHA.

Meanwhile, as mobile homes continue to be one of the choices people make when purchasing homes, investors can consider not necessarily buying one themselves, but buying a mobile home PARK instead.   This post by Frank Rolfe at Bigger Pockets was very interesting to me,

In a typical mobile home park, the phone might ring once per month for a lot for rent (normally an RV) – that’s the whole sales side of the thing. The yellow page ad comes up once a year, so that kind of handles marketing. I show up in court to evict someone every once in a while. But that’s about as much action as I get.

What about crime? I tell the tenant to call 911. What about rowdy neighbors? I tell the tenant to call 911. Loose dog? Call 911. There really isn’t much that ever goes on that the answer is not “call 911″.

This sounds like a pretty good deal to me as a potential investor. Have you ever lived in a mobile home?  What was your experience like?

Photo by I Eated a Cookie via Flickr Creative Commons.

Appraisers have a hard row to hoe these days.  Realtors and lenders, buyers and sellers are all mad at them because two and three years ago they “inflated” prices.  Now they aren’t taking any chances and seem to be “deflating” prices.  Or they mark a home as being located in a declining market area allowing some lenders - at their discretion - to require a bigger down payment or they don’t fund the loan at all.

All in all, though, I think appraisers are doing the best they can with what’s been handed them.  One appraiser I just spoke with has been handed a big pile of mess to deal with.  She’s been asked to appraise a home that has been foreclosed on and the people who lost the home are hostile about the eviction.  But she’s expected to go in - even though she had nothing to do with the foreclosure or eviction - and face an angry family so she can determine the value of the home on behalf of the bank.

I wouldn’t want to be in her shoes right now.  Not at all.

A good Realtor needs to stay in touch with their customers, clients, friends, family, and all acquaintances, but sometimes just doing an old-fashioned open house is a part of the back-to-basics business approach that helps them get through slow times.

I held an open house this past Saturday and Sunday and have spotted a new trend in real estate.  The lease-purchase buying option seems to have taken on a new life this past month.  The listing agent for the house I held open put a sign in the yard that said “Lease Purchase Option.”

On Sunday, about eight people came through the door and every single one asked about the terms of the lease purchase.  I think it could be for one or two reasons:  1.) They want their foot in the door to close before November 30th so they can get the $8000 tax credit for first time homebuyers, and 2.) Credit is still an issue, but buyers think that at least if they’re doing a lease purchase, they are moving toward the American dream - which I assure you is still very much alive.

The real estate questions I’ve had these last few months have been:

• Do you know an investor who will buy my house and lease it back to me?
• Can you help me find a lease purchase?
• If I sell my house now, how bad will it be?

With today’s housing report, though, I anticipate the phones will start ringing again from people who do feel secure in their jobs and who are ready to take advantage of lower mortgages and lower prices.

I just read the most discouraging news from The Ground Floor, the web log for the Urban Land Institute.  They are predicting the real estate market to hit the bottom in 2009 and continue to flounder through 2010.  From the article,

"Commercial real estate faces its worst year since the wrenching 1991–1992 industry depression," conclude industry experts interviewed for the report, which projects losses of 15 percent to 20 percent in real estate values from the mid-2007 peak. "Only when property financing gets restructured will pricing recorrect so we can find the floor, and this transition could wipe out companies and people," says one respondent interviewed for the report. 

The report went on to say that if you are an investor planning to purchase (i.e., not sitting still like they advise), focus on the coastal areas with 24-hour cities, buy distressed condos near urban areas, and go green to cut high energy expenses.

This really is an outstanding time for anyone who wants to be a player in real estate investing to pay attention.  With the distressed sales now available, banks and mortgage companies do NOT want to hold on to properties so I’m seeing prices plunge.  And if what The Ground Floor is reporting holds true, 2009 should be even more spectacular for investors.

The Ground Floor has many other interesting articles including a review of Presidential Candidate John McCain’s Housing Resurgence Plan, fixing the nation’s infrastructure deficit with the next $700 billion, and many more.

Photo from Cape San Blas Real Estate Blog.

Chewing over the buyers we’ve recently encountered, my colleague just said, "I find that the more inexpensive the house, the more the buyer wants given to them in incentives." 

We aren’t sure if buyers who are purchasing less expensive homes don’t have the money for downpayment and closing (if they don’t have either, they probably should NOT be buying) or if they just have the mindset that they’re "owed" something for taking that home off your hands.

We also think that with it being a BUYER’s MARKET people seem to believe that they can get homes at dirt cheap prices, so that’s all they offer. 

I say this at my own risk, but if you don’t have to sell right now it may be a good idea to just sit tight.  The market will eventually recover, especially since the Feds are stepping in to rescue the U.S. financial market.  That rescue feels a bit like take and take to me - these financial giants make huge profits, yet when they falter, the government rescues them.  I believe this is important for the investors, but for those in management I quesiton the golden parachutes they have to float their way into a wealthy retirement.

Meanwhile, what does the Fed rescue mean for struggling homeowners?  According to CNN.com,

Here’s how the bailout could work: Once the Treasury Department takes hold of the securities, it can review the terms of the underlying loans and the financial shape of each homeowner. The department then could opt to modify the loans - by reducing the interest rate or principal balance - to affordable terms for borrowers.

I know my friends who are suffering could use this help.  But is it too good to be true?  Maybe.

"The No. 1 barrier to keeping people in their homes has been the challenge of these loans being in mortgage-backed securities," said Ken Wade, chief executive of NeighborWorks America, a national community revitalization group chartered by Congress whose board is made up of bank regulators. "Counselors across the board say that is the major hurdle they are facing."

As I’ve said before, these are interesting times we live in.  Keep a cool head and a steady hand.

Go tour some of the most shockingly eccentric converted homes around!

To tempt you is my favorite: The Boeing 727.

Also, check out actual missile silos homes missile silo homes at Banks.com.

Remember the book that became a series by author Gertrude Chandler Warner?  It was called The Boxcar Children and told the story of four orphaned children who were sad and desperate because they were being sent to live with a mean grandfather.  They were so upset that they ran away and found themselves deep in a woods where there was an old, abandoned boxcar.  They set up house there, and traveled into town for part-time work to pay for food, blankets, etc.  Eventually, a benevolent elderly man began helping them. The Boxcar Children loved the man and were elated when they learned he was actually their own grandfather.  When they moved in with him, he moved their boxcar to the backyard so they children could still play in it.  Or so I remember.  I could be off on some of the details!

All that said, it reminds me of these new houses:  Container Homes.

BEFORE

AFTER

Go read more at CurbedLA.

Today I took a few minutes to plan for an upcoming trip I am about to embark on with a friend to beautiful Palm Springs, California for a much needed spa weekend. Impressed at the beauty, I decided to see what homes look like and go for in and around the area. One major celeb’s home that just came on the market caught my eye. It seems Suzanne Sommers has just listed her Palm Springs mansion for sale for a nominal $35 Million!

They just did a post about it over at Big Time Listings. But it seems The Real Estalker first broke the story on January 11th. Here’s the highlights;

SELLERS: Suzanne Somers and Alan Hamel
LOCATION: Alta Vista Road, Palm Springs, CA
PRICE: $35,000,0000
SIZE: 65 acres, 10 bedrooms, 9 full and 3 half bathrooms (spread across several buildings)

Maybe I should arrange for an "Agent Preview" while I am there! Think they’ll ask for a pre-approval letter???

Big Time Listings has a link to a virtual tour you can take of the estate (coined Les Baux de Palm Springs by Suzanne and her husband after their favorite French town by the same name) at http://www.lesbauxdepalmsprings.com.

Here are some photos courtesy of The Real Estalker:   (Click on photos for the full view)

I’m a big proponent of continued learning. I love to get smarter and could attend classes every week if I had the time. I would love my full time job to be traveling the Country and attending every conference, seminar and summit that is offered (and I often do). I love it that much.

One big reason why I attended the Inman News Real Estate conference in New York was because I wanted an unbiased opinion (no company affiliations) from researchers, business and finance experts and economist on the outlook for the 2008 real estate market in the US.

From most, the news was not good…The consensus was that the US is heading into a recession and the housing market is only going to get worse, said four out of the five panelist that spoke. They included;

Dottie Herman, President and CEO, Pridential Douglas Elliman
Barry Ritholtz, Chief Marketing Strategist, Ritholtz Research; CEO & Director of Equity Research, Fusion IQ
Noah Rosenblatt, Founder UrbanDigs.com, Licensed RE Salesperson, Citi Habitats
Professor Nouriel Roubini, Co-Founder & Chairman of RGE Monitor: Professor of Economics, New York University’s Stern School of Business.

"We are two years into a housing correction, seven months into a credit crisis with a huge debt problem and another two years before we reach the bottom", said the panelist. They went on to say that "foreclosures from the sub-prime debackle will exceed  2.5 million homes this coming year and we should see 10 million homes with negative equity."

Hmmm, not exactly what I was hoping to hear.

Brad Inman compared the 1978-1982 real estate decline to the current decline we are experiencing. He said,

"From 1978 -1982 we went from 4 million homes sold down to 2 million homes sold but recovered back to 4 million homes just two-three years later. Currently we went from 7 million homes sold in 2006 to just 5 million in 2007". He attributes the recovery in the early  80’s to the drop in mortgage rates to speed the recovery. This time, he says, "we’re just not sure how to turn it around…where’s the switch"? There is no obvious fix and lots of home owners are heading for trouble. He suggest that as real estate professionals, "we do all that we can to advocate for our clients to save their homes".

Ok, thats about as much negativity as I can handle, so be sure to tune in tomorrow for more from Connect 2008! Upcoming posts will include some of the 50 Best tools to use in this Market by Brian Boero, 1000 Watt Consulting. Also, the who’s who that I was lucky to meet one on one, as well as lots of other great info that I was privy to!