Lets face it, for some people, being a landlord is very undesirable, but having the security and benefits of owning real estate is very desirable.  Triple net leases are able to offer the security of owning a tangible investment like real estate, without having to place tenants every year and worry about the headaches and time it takes to maintain a property.  Instead of dealing with individual people, tenants are corporate companies with credit ratings that allow owners to asses their level of risk and return.  The higher a company’s corporate credit rating, the lower the capitulation rate (cap rate) or annual return on your investment.  Typical cap rates for triple net lease range from 6% to 10%, although some triple net leases offer lower and higher cap rates.

Triple net leases are also unique in their duration.  Unlike a typical residential lease that lasts only 6 to 12 months, a triple net lease lasts typically 15 to 30 years.  This is a huge advantage for property owners who want consistency in the monthly payments and the security of not having to worry about the constant struggle of placing tenants.  Triple net leases also take into consideration inflation and typically include rent increase clauses through the life of the lease term.

Typical tenants for triple net leases are Walgreens, CVS, Social Security Administration, Arbys, Pizza Hut, 7eleven, Wells Fargo and many more.  These well recognized companies are willing to participate in triple net leases, because owning all of their business locations is not advantageous to their business model or growth.

The purchase prices of triple net leases have a wide range that can be as low as $500,000 and exceed $20,000,000.  Most purchasers of triple net leases put 50% down, or pay cash through a 1031 exchange or savings.  A triple net lease purchaser may be looking to have a healthy cash flow for retirement, or perhaps steady income after inheriting a large sum of money.

Lets take a look at a typical triple net lease for a buyer who has decided to 1031 exchange their money into a Walgreens (on a side note, Walgreens will typically only occupy corner locations unless confined to a large city) that is AAA rated with a cap rate of 7.25% at a purchase price of $5,500,000.

Purchase Price: $5,500,000
Cap Rate: 7.25%

To Calculate the annual and monthly payments, simply take the purchase price of $5,500,000 multiplied by 7.25% for the annual rental amount, which is $398,750 or $33,229.17 every month.  This is an ideal situation for an investor who is looking for a consistent return, plus likes owning real estate.  Some investors may be willing to purchase a triple net lease with a lower credit rating for a stronger cap rate in the 9%-10% range.

Owning a triple net property offers a long term lease with a corporately rated tenant, opposed to an individual tenant in residential real estate.  The major benefit of a triple net lease is the consistent monthly return without the hassles of being a landlord.  If you would like more information on triple net leases or the properties available, please sign up here, or call us at 312-265-8417.

For seasoned investors, what I’m about to tell you is nothing new, but often comes a surprise for newer investors.  In general, cash cow properties will not be prettiest property on the block, but running a successful real estate portfolio comes down to at least covering the monthly and unforeseen expenses.  “Aligator” properties as we call them, or negative cash flow properties take from investors bank account every month, opposed to contributing to it.  Some investors, are fine with this due to future appreciation, or because they plan to use the property as a vacation home.  This is commonly seen in higher priced markets such as California or New York.

For the average investor, a portfolio that produces a consitant negative cash flow, could inhibit their desired lifestyle, or even cause forecloses.  This is a problem that is currently plauging our country after so many homeowners lost significant value in their real estate portoflios.  The average investor is not able to take a 20% or more decline on their real estate portfolio and continue to make high mortgage payments on properties commanding lower rental amounts.  Do not make the mistake of buying a property on emotion opposed to the numbers and later regret your decision.  It generally takes a lot of good decisions to build wealth, but one poor decision can destroy a lot of wealth.

So how can real estate investors best protect themselves from getting into an alligator property?  The Lucrative Investor team has several measures and approaches it uses when analzying prospective deals.  One of the pillars that we use is price to rent ratio.  In general, if a property is priced at $150,000, we ideally want the property to command at least $1,300 to $1,400 a month in rent.  Investors in an ideal world would have a 1 to 1 price to rent ratio, where their property would command $1,500 a month in rent or more.  This is one general figure that indicates a strong factor for positive monthly cash flow.

Monthly expenses will make or break your prospective deal.  We pull our monthly numbers by acting as a renter our self.  What are comparable rents on craigslist for the area?  What is the average quotes from 3 to 5 property management companies that are located locally (we act as a renter opposed to a prospective owner because these companies want your business and often tell you what you want to hear opposed to the reality).  Beyond what the rental rate is, what will it cost to insure the property?  This can also be done by calling 3 to 5 insurance companies with an address and obtaining a written quote.  The same principal applies to taxes.  Call the assors office and figure out the property trends and taxes for the few previous years.

Conducting the proper due diligence will take some time, but it is time well spent to prevent yourself from adding an alligator property.  Once you have all of your numbers accurately estimated, simply run the math and decide if you can live with these monthly numbers and build a nice buffer account for any unforeseen expenses.

Evaluating real estate is pretty simple in principal and fairly stable and safe if the correct procedures are taken to calculate the cash flow.  After the first few times it will become easy to you and allow you to assemble a strong real estate portfolio that meets your desired cash flow needs.

The reason that so many investors both large and small seek non-performing notes is because of the extremely attractive pricing.  People hear stories all the time about a property that was purchased for 40 cents on the dollar or lower, but they are extremely hard to find.  The other barrier to entry for the average investor with non-performing notes is the cash involved to successfully close on a non-performing note.  Banks typically will not carry any debt on a non-performing note, which means investors have to be well financed in order to successfully close a transaction.

Non-performing notes are priced so aggressively because the bank has a wart on their balance sheet that is not only performing, but has not yet gone through the foreclosure process to wash out the liens and other clouds on the title that keep the property from re-structuring towards a performing asset again.  Often, non-performing notes involve a lot of work and will have plenty of obstacles to over come once purchased, but the bank realizes this and prices the asset very aggressively to sell.

One of the most recent non-performing notes the lucrative investor team was involved with was two mobile home parks located in the MI.  We all know that MI is one of the worst affected states in America from the auto industry with high unemployment, but mobile home parks are priced at the level where it’s average family can afford, plus the owners are only responsible for collecting lot fees, not home upkeep and other headaches involved with lower priced rental properties.

The key to this deal were outstanding numbers.  The previous loan within the past few years on these two properties was $18,000,000.  The investor who purchased this asset had the contract with the bank for $3,650,000!  Even at the 46% occupancy, it was operating at a 23% cap rate bringing in $73,000 a month income with the new debt piece only at $36,000!  Now that is a cash cow.

On top of that, the investor had two as is offers at $4,500,000 and $5,200,000 that could not get the deal themselves because the first group had it locked up in contract.  Hedge funds and other institutional investors have banking relationships like these where they are able to secure and close on deals for great prices.  They take the time and effort to clear the title of any clouds and get the property operating again at an acceptable level where they are able to re-sell a clean performing asset and makes in some cases millions of dollars.

Non-performing notes are usually not a rosy picture when it comes to the task at hand of re-managing a property to get it back to an acceptable performing level, but hardly any other asset can offer such aggressive pricing and strong rewards for investors.  As the housing correction continues to take place for the next several years, more and more opportunities will be available for investors who are well positioned and willing to take on risk for big rewards.

If you would like more information on non-performing notes or opportunities available,call us at 312-265-8417.

So if a single family home rents better and usually commands more in rent, why not buy single family homes every time?  Well, unless significant down payments are made, single family homes do not tend to cash flow as strong as mutli family due to higher price per square foot.  Also, in general single family homes command a lot more hands on attention than multi-family investments.

The Lucrative Investor team has had a lot of experience with investors and single family homes, which has been positive for the investor, but also negative.  The hands on investor who is very selective and hires the right property management company (if they do not live near by, which is usually the case) can do very well for themselves and enjoy the monthly cash flow.  Investors who are too busy, or do not want to be hands on in the process usually do not do very well.  Many investors have had to learn the hard way that hoping quality renters come and stay does not work!

Successful single family home owners have learned that good tenant relationships and up keep of their property will help lead to a profitable endeavor.  There is a fine balance between making an investment property too nice and not getting a return on your money, but also having a low rent place that will be difficult to lease in a competitive market.  The best way we have found when evaluating a rental property is to put yourself in the tenants shoes.  Sounds like common sense, but often investors will chose better home amenities or lower priced properties because they think it will cash flow better, instead of purchasing a property for more money where they would actually want to live.

When purchased correctly, single family homes can be a great way to build wealth and a cash flowing real estate portfolio.  The key to success is to fully evaluate your prospective property and compare it to other rental properties in the market to ensure that your property will be a desirable rental and also attract the type of tenant that you feel comfortable working with.

Before the tightening  of the credit markets, it was common for real estate investors to have up to 10 mortgages and in some cases more depending on their local banking relationships.  In today’s environment, it is uncommon to see investors who have more than 3 or 4 mortgages obtain a loan for additional properties even if the numbers make financial sense.

Typical multi-family investments are duplexes, triplexes (tris) and quadplexes (quads).  Multi-family investors often find that their units do not command rents as high as single family homes, nor do they see quite as much appreciation, but for buy and hold investors, or roll your sleeve up investors who are willing to improve a property and raise rents, they can be a fantastic investment.

Location of a multi-family property is one of the biggest factors in it’s future value and rental demand.  In areas with higher density such as cities, or college towns, multi-family properties are ideal for rental.  Tenants in dense markets do not expect, nor do they usually care about amenities such as a yard or garage that single family home owners desire.  They are more sensitive to the rental amount that fits their monthly budget.

Single family homes in dense areas often do not command enough rent to cover the expenses and create a positive net cash flow (this is common in markets such as California).  With lower price per square foot and multiple units, multi-family properties will typically allow an investor to generate positive net cash flow, or be close to neutral and take advantage of future appreciation, tax benefits and principal paid by renters.

A popular exit strategy for multi-family property owners is dividing units into individual units and selling them separately to maximize their sales price.  This process is called condo conversion and will have different rules and regulations based on the properties location and zoning requirements.  In most markets, a property owner will have to have their plans approved by the city council and inspected to meet requirements such as a firewall in between the units of the building.

The owner may also have to work with their lender to determine loan payoff, as they may have a due on sale clause in their mortgage contract.  This usually happens when more than 4 units are involved, as properties with more than 4 units will almost always have to be financed through a commercial loan.  Commercial loans are held by the banks that originate the note, or what is commonly referred to as “holding their paper”.  Commercial loans are more flexible in their terms, but usually have strict requirements about payment upon sale.

Multi-family properties can be a fantastic addition to real estate portfolios depending on location, condition and market factors.  Before purchasing a multi-family property, prospective buyers should conduct heavy market research such as average price per square foot, insurance and tax rates, as well as what realistically they demand for rent.  If the numbers pencil out and future of the location looks positive, it may be a purchase worth making.  Keep an eye in dense markets such as college towns and cities where renters tend to be more conscious about their monthly budget and people tend to rent longer before purchasing.

When you are going to sell your house, there are a few things that you need to do. First is, do you want to sell the house yourself or go with an agent?

If you go with an agent, when you pick someone you need to make sure that they are familiar with your area (and your neighborhood if possible). There are also some questions that he or she needs to be asked before you sign on the dotted line.

You need to know how the agent is going to advertise your house. Most real estate agents will list your house on the MLS and their own website, but you need to know if they are going to list in newspapers and through other means. Anyway that an agent will advertise will help your house get the most exposure.

When you do this, also make sure that they are putting pictures up. The more pictures the better. Think about it, if you want to move somewhere far away and you go to a website to look at houses, you will be more inclined to look at the houses with the most amount of pictures.

You should also make sure that the agent is showing you houses in your neighborhood that are accurate comparisons to your own home for the price. If you don’t have a number that you are willing to stick with as far as price is concerned, then seeing the comparable homes in your neighborhood will give you a much better idea as to what you’re going to get.

When it comes to money, you should also see what the agent’s commission is. Most agent’s commissions are not set in stone and if you have a buyer who is not represented by an agent, then the selling agent should cut his or her commissions accordingly.

Your agent should also know a lot about the area. In most cases, “I don’t know” or “I’m not sure” isn’t a good enough answer. For example, if someone comes in to buy your home and asks what school district that your house is in “I don’t know” won’t be acceptable. You need to make sure that the agent knows this information or has a way to get it quickly (via smart-phone or some other hand-held).

Remember, you are hiring them to do a job; just like if you were hiring someone to work for you in any establishment. You should check their references and make sure they are available when you need them. Past performance is key here also.

When checking references, try to get the numbers of the last few people who listed with the agent, not necessarily sold with him or her.

Also when you “interview” him or her, make sure that you know how they have done in the past. If they sold a lot of realty last year, ask how much they didn’t sell.

Most people start off with a rental. There aren’t many who can just start off by buying their own first hope, so renting is the most popular option for those of us just starting out. There are a few ways to save money when you’re looking into renting a place of your own.

The first way that you can save some money when looking into a rental is trying to find a roommate. This is an option if you don’t want to live alone. Having a roommate that you can trust can cut your rent in half, as well as utilities. Some really great roommates even help pay for things like food.

In some areas, apartments can be rented by the bed space. This means that you have your own room, but you share a common space (like the kitchen and living room) with roommates. When I’ve seen this, it’s typically three other people sharing the space. This can save you a lot of money because in apartments that are rent by the bed space, the owners typically pay for things like water, electricity (up to a point), and cable. You have to be careful about these though because the process to getting a roommate is very similar to getting a roommate for a dorm room and the process can be a bit frustrating.

If you have your own method of transportation, your rent can be cheaper too. If you want to take public transportation everywhere you’ll likely have to live in an area closer to the city. The closer you live to that, the more expensive your rent will likely be.

Trendy locations often have the highest rent also. Just because it’s trendy doesn’t mean its safer or that it will have the best amenities. You can likely find something that is a little more quiet for a much more reasonable price. There, you might even be able to find a place with a washer and dryer…and parking!

If you’re really desperate for a cheaper place to live, look at some jobs that will house you for free. I once had a friend who was a live in nanny and she had her apartment paid for so that she could live near the house. I say, you have to be desperate because at any given time of day her bosses may call her to do something…even if she already had plans for the night.

One last thing is, be a little nosy with the neighbors. You might be paying more than the guy living next door. It happens quite often where one tenant will pay one price and another will pay something different. Just ask around and see how much other people are paying for their apartments and see if you can get a better deal if there is one to be had.

Selling a home right now is an adventure in itself. There aren’t a lot of  properties moving in some areas, and in others…they are. There are still ways to get the most for your house even now though…and many of these tips are tried and true ways to get a good price for your home.

First of all, make sure your house is clean. Some buyers like to see a fully furnished house; some prefer to see a house that is bare. No matter how they feel about it, they will always agree that a clean house is what they REALLY want to see. It is extremely difficult to overlook stinky garbage and dirty floors. From experience, when I was looking at homes to purchase, there was a neighborhood right next to the college I was attending and the houses were definitely in our price range. However, most of the homes we walked into looked like they hosted an entire fraternity or some kind of natural disaster had struck them.  This image never left my mind as we looked through the neighborhood; we actually ended up moving to a much quieter neighborhood 8 miles from campus.

Keeping your house clean isn’t limited to the inside. Curb appeal is very important and making sure that your lawn is groomed properly will not only attract more buyers, but will add a bit of value to your home. If buyers consider your lawn a bit more low maintenance (and less of a headache) than a weed-ridden lawn then you may be able to get a bit more money for your house.

It wouldn’t hurt to have someone inspect your home before you put it on the market. If you do this, then the inspector will find all the little things (and big things) that may be wrong with your house and you can fix them before any potential buyers’ inspectors come along and find them. A buyer will ask for whatever the cost of repair is off the price of the house (and usually a lot more) so it is just cheaper in the long run to fix the issues.

Make sure that you stay in line with other homes in your neighborhood. If your house is priced $20,000 more than all the other houses in your neighborhood because you feel like you should be getting some return on those granite countertops and stainless steel appliances you put in your house, then you likely won’t sell your house. The buyers that will be canvasing your neighborhood will look in what they consider their price range and $20,000 on a $130,000 home is a lot of money. You really want to stay in line with what is standard in your neighborhood if you were planning on upgrading anything in your home.

Finally, one of the newer ways to increase the value of your home is to make some “green” improvements. Everyone is looking for greener ways to live these days and typically when something is already put in place that is environmentally friendly, then it will save the buyers money in the future. So, you’ll also be seeing “green”  when they do.

I know while the ads have definitely slowed down a bit, there are still many out there that advertise reverse mortgages. So what exactly is a reverse mortgage and is it the right choice for you?

First of all, a reverse mortgage is loan that is available to those who are above the age of 62 (if the borrower has a spouse, the bank will go by the age of the youngest spouse) that releases the home’s equity to the owners in payments or a lump sum. So, as it is called a “reverse mortgage” things are a bit reversed because the lender pays the borrower money rather than the other way in a traditional mortgage. In the case of a reverse mortgage, the homeowner is not obligated to pay the balance until the home sells or the owner passes away.

The people who decide to do a reverse mortgage do not have to sell their home (saying a homeowner is selling their home to the bank for a reverse mortgage is a common misconception), they do not have to give up the title to their home, and they do not have an additional mortgage payment (that would be a home equity line of credit).

A credit line from a reverse mortgage can be used for anything, but considering the age of the owners, it is typically used to fund retirement and expenses associated with retiring couples.

You may be wondering how exactly the interest rate works in a reverse mortgage. After I looked into it seems as though you are charged interest on the proceeds that you get from the reverse mortgage. However, you can get a low fixed rate (this is new however, most banks charge a variable rate). The rate is tied to indexes and do move as they move. However, the most typical one to track is the 1 year T-bill.

Reverse mortgages may be right for you if you need the money for retirement or anything really. However it is important to remember that it is a debt that must be paid back when the house sells (or, as I understand it, the owner moves out into a retirement community). Having the equity in your home can make a difference on the quality of living though. If you think that a reverse mortgage can benefit you, call or go into your local bank to find out more specifics about the process.

In this real estate market, you can find yourself thinking that a house is a good deal just because it has been put on the auction block after a foreclosure. While it may seem that you are getting a good deal on a house, there are certain things that you have to keep in mind to keep yourself from getting caught up in the frenzy and getting into a house that you actually don’t want and that you will find yourself resenting in the future.

First and foremost, don’t get caught up in a bidding war for a foreclosure unless you are 100% sure of what that property is worth. Some times a foreclosed property will be completely stripped of anything that is worth ANYTHING in the property such as copper wiring and other fixtures throughout the house. While many of the houses on the market aren’t that dire, it is still important to try to have a contractor or someone else with you who knows how much repairs on the house are going to cost.

In my opinion it is the most important to not get caught up in thinking that you have gotten a deal on a house. In some cases foreclosures are selling for more than houses that are actually “for sale” in neighborhoods just because of the buying frenzy that surrounds the listings.

Ensure that you know what the neighborhood is worth prior to bidding on a home.

Secondly, after you have made the decision to buy a home that has found its way into the foreclosure listings, it is important to make sure that you are approved for a mortgage for whatever your budget is. Having that pre-approval letter will definitely make any offers you make on a home that much more appealing.

Third, remember that the banks that have listed the houses are likely not going to fix them up at all. The bank owned properties are almost always sold “as is” and it takes an act of Congress to get banks to fix things in these houses; they would much rather sell to the next buyer who isn’t requesting that things be fixed in the house.

When you rent, there are things that you no longer have to worry with such as broken refrigerators and other appliances, as well as leaks and other problems with the actual property. In most cases, you don’t even have to cut the lawn, the landlord takes care of all of it.

As a homeowner, you do have expenses that HAVE to be taken care of; and even when the mortgage is paid off, there are things that you still have to deal with when it comes to the cost of a home.

So, if you have a mortgage, there are things that are added to your payment that are held in escrow and the mortgage company actually pays with the money. Property taxes and homeowner’s insurance are held in the escrow account. Once your mortgage is paid off, these are bills that will come around every year and you will HAVE to pay. There are some occasions where property taxes can be deduced from your income tax that you have to file at the beginning of the year, but at around $150 per month for the average home, this is still one bill that some may forget when they pay off their mortgage.

Another expense that all homeowners face, mortgage or not, is repairs. I can’t emphasize this enough. From personal experience, in the past year we have had to fix or replace the air conditioner, the refrigerator (which still isn’t fixed completely), both toilets (our water basically eats the parts) and the front and back doors. Things that still need to be fixed or replaced include or dishwasher and carpets. Something that we should probably start doing is setting aside a bit of money every month to help pay for something when it decides to break.

The same could be said about any other types of repairs, such as exterior repairs, that need to be done to a house. Roofs need to be replaced every 20 years or so and they cost a LOT of money when it comes time to replace the current one. Painting the exterior of a home can also cost a lot of money, particularly if you hire someone to do it. A 1,200 square foot brick home could run you about $4,000 for just two coats of paint if you hired someone to paint it. Then, you can’t forget how much it costs to maintain a yard. Chris loves playing in the yard and thanks to his concentration on the yard work, we have a nearly weed-free completely Bermuda grass lawn (in our neighborhood Bermuda grass is the best to have and is NOT considered a weed). He spends about $40 per month on just the lawn treatments and he does all the work himself.

If there are some things that should be considered when thinking of the cost of ownership of a home, include them in the comments below!

In the United States, we know that home prices have fallen dramatically and therefore, housing has become more affordable. In the United Kingdom the same phenomenon is happening. After the Bank of England reduced interest rates in the country to half a percent, affordability of homes has increased since Q3 2007.

In 2008, the median home price in the United Kingdom fell 16% during 2008 and through this year, it hasn’t improved.

When calculating affordability of housing, there are two things that are taken into account: The rate of interest and the average earnings of citizens in that area. Even though unemployment in the United Kingdom is on the rise just as it is in the United States, housing prices seem to be falling at the same rate or even faster in some areas.

In some of the priciest areas of the United Kingdom, the home affordability percentage has increased. In London, the affordability percentage has come down from 56% to 34%. The number is so low that it is actually below the long term average.

The most affordable areas included Copeland in Cumbria, there the affordability percentage of 22% means that the interest rates are low and the disposable income is higher. Of course, there is always “the other side of the coin” where home affordability is still poor. North Cornwall is the “least affordable” area that was surveyed with 63%. South Buckinghamshire came in at 62%.

Even though affordability is on the rise, it can still be difficult for first time home buyers to get the loans they need for mortgages. In the United States, it is awfully difficult for anyone to get a loan, particularly first time buyers who may not have a lengthy credit report. First time home buyers are also being warned against buying a home right now because of the unsteady job market.

Even worse than the job market in the United Kingdom is the threat of negative equity in their homes. No one wants their home’s mortgage to be considered “underwater.” It is something frightening to consider when buying a home and even worse when you know that you’re paying on a mortgage every month that is now more than the house is worth. In this kind of economy, that is not always feasible…which is why many people have defaulted on their mortgages. For example in the United States, many people in California, Las Vegas and Miami all saw this problem. While other areas did witness negative equity issues, these were the worst. In some cases, the mortgage on their home was double what their house was really worth. When someone is faced with that and they have lost their job, I can understand why they don’t feel as though it is affordable to continue paying on their home.

For more information visit the SOURCE

Research by Communities and Local Government says that the population of England is going to increase from 50.8 million to 60.4 million by 2031. There is also a projected increase of one person households. It is expected to increase by 60.3%. In 2006, the number of one person households in England was 6.8 million, the 2031 projection is now 10.9 million.

With an increase of 9.7 million people, there will have to be more room for them. The good news is that since 1938, the number of houses in the country has increased greatly; it has grown from 10.6 million homes in 1938 to 22.2 million as of March 2007. In 1938 people weren’t buying a lot of the homes; there were only 32% that were owner occupied, there are now 70% that are.

Over the past decade, there has been a huge increase in the number of homes built in the country to keep up with demand. It has been seeing an increase in homes between 121,000 and 207,000 every year since 1998. However, with the recent recession, that figure has dropped and between 2008 and 2009, there was only 108,000 built.

Another problem that has been happening in the recession is that the number of vacant houses has also increased. Between April 2007 and April 2008 the number of vacant private homes increased by 26,000.

It appears as though in England, that as the recession has gone on, more and more people are renting instead of buying homes. It may have more to do with the actual cost of ownership than the recession though. In 1990, the average price of a home was 63,000 pounds. It increased to 196,000 pounds just 19 years later. When people are losing their jobs left and right, they simply can’t afford such an expense every month. Not to mention, the true cost of ownership of a home is not only reflected in the monthly mortgage payment but also in the cost of repairs to the house. Things like replacing appliances and fixing plumbing is something that a homeowner has to worry about replacing or fixing on their own dime rather than expecting a landlord to fix these things.

With the number of people that England is expected to accommodate in the next 20 years, there will likely be even more rentals in the country; particularly with single person households. Also, I can expect that housing prices will not go down in the country thanks to the very limited amount of space in the more urban areas.

In the United States, the population is also expected to explode in the next 20 years and housing prices are expected to steadily, but not rapidly, increase over the time frame. Of course, there will be urban areas where bubbles will form and housing prices in those areas will be more expensive than other areas, but over all the national average will likely increase steadily.

Source

It is difficult to sell a house in normal times unless your house is “priced to sell.” With the recession and falling home prices, selling a home is an even more tedious and time consuming process.

There are little things that anyone can do to increase the value of their home to not only make the quality of life while you’re living there better, but also improve the appeal of your home to potential buyers.

More expensive projects:

1) Window Replacement – This is one of the things that will not only help you save on your utility bills, but you will also see a 77%-80% return on your investment depending on if you put vinyl or wood windows in (vinyl gets a better ROI).

2) Siding Replacement – With an 87% return on investment(on fiber-cement siding), this is a pretty good way to make your home seem more practical to potential buyers, and like putting new windows in, it will help save on your utility bills. Even when replacing your current siding with a foam backed vinyl siding you could still see up to an 80% return on your investment.

3) Major Kitchen Remodel - Remodeling a kitchen can cost a lot of money; typically with a major remodel homeowners can expect to pay up to and over $110,000. With a figure like that one must weigh how much the remodel will cost versus how much they can realistically get for their home. While some may be able to see a 71% ROI, if your home is only going to fetch $150,000 at the high end for your neighborhood, then spending over $100,000 for a kitchen probably isn’t feasible.

4) Bathroom Remodel – A bathroom remodel is another one of the things that will cost a lot depending on what all you want done to the room. Bathroom remodels often include tearing out walls and moving plumbing inside the house. This type of remodel can cost $50,000 or more, but if the neighborhood and other property values support it, it could return 71% of the cost.

A few more budget friendly suggestions:

1) The addition of a wood deck - While adding a wood deck versus a composite deck isn’t going to fetch the same ROI, it will increase the value of your home thanks to more people wanting to entertain in their own homes. Wood decks are cheaper than composite and “only” cost around $10,000. A wood deck can also fetch somewhere in the neighborhood of 81.8% return on investment.

2) Minor kitchen remodel – This is something that is far more economical and in some places, smarter. A minor kitchen remodel includes doing things such as replacing appliances and maybe counters. No walls would be torn out to do a minor remodel. Minor remodels are seeing a higher ROI than even major kitchen remodels right now at 79.5%.

3) Basement Remodel – That unfinished basement could become an entirely new set of bedrooms if you so chose. Finishing and remodeling an unfinished basement could net you a 73% ROI. Basements don’t have to be drab places either. I have family members who have a remodeled basement in their house and it is my favorite place in their whole house.

4) Attic room – Adding a bedroom will almost always increase the value of your home. Adding a bedroom in the attic could mean a 74% ROI. The only thing that I question about this (and perhaps it has to do with the attic in my own home), but if the attic is only accessible through a fold down ladder and a “trap door” then is it really possible to do this?

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When you contact your insurance company to file a claim there are a few things that you shouldn’t say if you want to make sure that your policy will cover the incident. Now, do not fraud the insurance company, just make sure what you’re telling them is the truth.

1. Never start a sentence with “I think” or any other term that indicates that you’re not sure as to why something happened. If you don’t know say “I don’t know.” Giving information that can be proven wrong later can really hurt your claim and can damage your credibility.

Particularly beware of speculating on blame or causation. For example, if you suggest that a water leak is due to a construction defect, you could give the insurer an out if that’s a policy exclusion.

2. Don’t use the “whiplash” excuse unless your doctor actually says you have it. This is one of the most fraudulent claims every year that insurance companies have to deal with. In some cases, according to Amy Danise from Insure.com, mentioning whiplash in your claim is likely to get it flagged for further investigation.

3. Don’t admit to a doctor’s test as being experimental when it isn’t. There is a difference between an actual experimental drug/procedure and one that is proven (and accepted by the FDA for use) but your doctor wants to try it out in your case. You may want to make sure that your doctor can prove that it will be covered by insurance before getting it done and fighting with the insurance company later.

4. The word “flood” triggers some kind of nervous, shaking, fear in insurers; so don’t use it. When it comes to homeowner’s insurance, floods aren’t covered. A flood is weather related too, not if your pipe bursts and you find yourself with a basement full of water.

5. Don’t act like the only thing you care about is the money. When an insurance company sees that you care more about getting a check rather than fixing your damaged property, they will likely put your claim on hold while they go and check further into it.

When it comes to insurance, it’s all about what the insurance company thinks. If they feel that you’re trying to make a fraudulent claim, for any reason, they can simply put the brakes on your claim altogether. It is rather frustrating to pick and choose your words when you talk to the insurance company, but it is important. Too many people, every single year, decide that having insurance is a good way to try to make a bit of money, when in reality that is not what insurance is for.

I can’t tell anyone what to do with their money, but if an insurance company sends a check out, then fix whatever is broken.

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There were three months of straight gains in the real estate market, however a government tool used to measure the average price of a home in the United States showed a decline for the month of August.

According to the Federal Housing Finance Agency, housing prices declined an average of 0.3% between July and August nationwide. It went on to say that for the past year, prices of homes are down a total of 3.6%. The way that this agency checks on the average price of a home is to calculate prices from mortgages that were sold or guaranteed by Fannie Mae and Freddie Mac (the Federal Housing Finance Agency oversees both of these lenders). The only problem is that Fannie and Freddie don’t guarantee or lend to high end home purchases.

The report did say that prices rose in the Pacific, West North Central, Pacific, and East Central regions of the country. The worst price declines were found in the East North Central, New England, Mid Atlantic and South Atlantic areas. Prices did remain steady in the West South Central areas of the country though.

One of the surprising areas was the South Atlantic region, where Washington D.C. is located. D.C. has been touted as one of the places to move because it is one of the places in the country where people are still able to find jobs. Even the job creation in the D.C. area could not keep the home prices from falling for the entire South Atlantic region (which includes all the states between Delaware and Florida). Prices were down for the region 1.6%.

The report doesn’t include specifics such as states or cities. However, it does say that nationally, prices are down 10.7% on average from their 2007 highs.

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According to a Reuters survey, new construction of homes in the United States and permits for future buildings are on the rise. The actual numbers are supposed to come out today.

Chief economist Chris Low from the FTN Financial group in New York said, “New home sales have improved in recent months and new home inventories are likely to fall to a 27 year low in September, but there are still about twice as many existing homes on the market as there were the last time sales were this weak, suggesting it is still a very difficult environment for homebuilders.”

Luckily, the housing market may actually be showing signs of getting better. The housing market is the worst that it has been since the 1930′s and the slump actually began in 2006 but didn’t become widespread for a few years.

“We forecast residential investment will add to growth in the third quarter, the first positive contribution since the fourth quarter of 2005, and contribute an average of 0.8 percentage points to quarterly growth next year,” said Michelle Meyer, an economist at Barclays Capital in New York.

“As for home prices, we believe the freefall has decidedly ended but that it is too early to call the bottom. Moreover, foreclosures are likely to flow into the market at an accelerating pace, weighing on prices.”

Like the cash for clunkers program, there is a government incentive for new home buyers right now. There is an $8,000 government tax credit for those buying their first home that is set to expire next month. There are also expected to be more foreclosures on the market throughout the end of the year. When there are more foreclosures on the market, new homes won’t sell because many buyers find foreclosures can be too good of a deal to pass up.

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Now that people are finally starting to buy homes again and foreclosures are starting to decrease, there are a few things that new homeowners should know about owning a home that they may not have thought about prior to that final closing date.

When you’re renting, there are only a few things you have to worry about, electricity, gas, water, renters’ insurance, and (of course) rent. However, when you go to buy a home you not only have to worry about the utility bills, but also the mortgage payment, mortgage insurance (if you didn’t put down 20% on the mortgage), homeowner’s insurance, repairs, and lawn maintenance.

Repairs are something that I have really found to be a pain when buying a house. Luckily, Chris and I both have parents that know how to fix things around the house who live fairly close. Yesterday, my dad had to come up and fix the garbage disposal (which was totaled) and one of the toilets in the house. Chris’s dad has to come up and help us fix the back doors (which need to be re-set) before we decide to put the house up for sale. Without someone in our families to help, these repairs would have cost us hundreds of dollars. We know because over the summer something small went out on the air conditioner and the small 15 minute repair cost us $150.

Another problem is appliances. When you are a renter and your fridge goes on the fritz, you call your landlord. When you own your house and your fridge starts sounding like an airplane taking off, you start saving money because that fridge is going to go out and you’re going to have to replace it with money out of your own pocket.

If you want to talk to anyone about lawn maintenance, talk to Chris. The lawn is something he really takes pride in and it gets expensive and is quite time consuming. However, in just two short years Chris was able to take a yard full of weeds to a nice, lush, golf course worthy lawn…even our neighbors who have hired someone to come and take care of their lawn come by and comment on how nice (and green) our yard is.

Of course, there is more to owning a home than appliances and lawn maintenance, but these are a couple of the things that are fresh on my mind and are everyday annoyances.

The number of United States homeowners that owe more than their home is worth will likely double to 48% in 2011 from 26% at the conclusion of March. This would lead to another blow to the housing market. This is all according to Deutsche Bank.

Home prices have been on a huge decline and will have the biggest impact on prime loans that have met the underwriting and size requirements of Fannie Mae and Freddie Mac. Prime loans make up 2/3 of mortgages and tend to be less risky because of their harsher requirements for someone to get a loan.

Analysts Karen Weaver and Ying Shen said, “We project the next phase of the housing decline will have a far greater impact on prime borrowers.” Of the loans they are talking about, 41% will likely be underwater by the first quarter in 2011, while only 16% will be underwater by the end of 2009.

The weird thing about this news coming out is that news has been coming out for months that report a stabilization of the housing market after three straight years of price declines.

Also, a very popular index showed (in July) that home prices rose for the first time since 2006 in May.

Of course, the decline in home prices across the country has led to further foreclosures because some people just can’t afford to pay what they owe on the house when the house isn’t worth what they paid. For example, in California are bad. People were paying $500,000 to $1 million for homes that are worth half of what they were when the owner purchased them. The people who bought their houses at that time are the ones facing the greatest losses.

The places that are having the worst negative equity are places in Florida, Arizona, Ohio, California, Nevada, Massachusetts, Illinois, West Virginia, and Wisconsin. Some homeowners in Florida and California will see 90 percent of the homes in their areas with underwater mortgages.

This is a huge problem for everyone who holds a mortgage currently. Even as the economy has started to improve, little by little, there isn’t too much good news in the way of home prices. In reality, home prices are still on the decline in a lot of areas across the country. In the areas where unemployment is still rampant and jobs are being lost twice as fast as they are being gained, home prices are still slipping.

I hope this isn’t true. I would prefer for mortgages to be worth at least the value of the home. Then again, the bank had to be referring to the full amount of the mortgage and not the principle that remains on the balance. I know that there are a lot of people who put a lot of money down on their mortgages, and have been paying on the mortgages for years. Unless they simply paid nothing but interest or have a 100% mortgage, then maybe their balance won’t be “underwater.”

So you’re trying to take out a loan, get a credit card with a reasonable APR or trying to buy something, anything on credit, but your credit score is too low for your liking? Well, the first place to start when trying to rebuild that score is to find out what exactly makes up your credit score.

35% of your credit score is from paying your bills on time. To help improve this part of your score, start marking due dates on your calendar. This is the single largest section of your credit score. Setting up automatic bill payment is also another way to ensure that your bills are paid on time. This also keeps you from getting interest rate hikes on credit cards and loans. Someone who pays their bills on time, every time, has an average credit score of 706. Someone who pays 99% of the time on time’s average score is 658.

30% of your credit score is how much you owe. You need to make sure that you keep your balances from equaling up to 30% of your total credit line. Your credit score is partly based on the credit utilization ratio. If a credit card company ends up reducing your limit, what you owe actually becomes a larger percentage of your credit line. So, if this happens try to get in touch with your creditor and get the limit reversed to avoid a negative mark on your credit score.

15% of your credit score is the length of your credit history. In this case, someone who has had a credit history for 20 years is going to obviously be doing better than one who just graduated college. A trick to utilizing this 15% is to keep the first credit card you ever open, open. Use it a couple of times a year and pay it off.

10% of your credit score is credit expansion. Here’s a problem, when you apply for too much credit your credit score can be harmed, however having new credit accounts can also help your credit score. Open new accounts over time rather than trying all at once. This will help your credit score in the long run as long as you’re paying your bills on time.

The last 10% of your credit score is credit diversity. If you have all your credit in cards then you’re credit isn’t diverse. However, if you have a variety of credit cards, mortgage, car loans and pay the bills on time while keeping the accounts active, then you’re diversified in this aspect of your credit. The key is to keep the accounts active because not using the accounts won’t help your credit at all.

After the housing market collapsed, followed by the credit crunch, it became quite difficult for people to buy homes. However, now, while still tight, it is becoming easier (than a few months ago) to find a mortgage. So how do you know what to get and what will you be happy in?

Here are some tips from the New York Times:

1) Start with the basics. Put 20% down on your home, get a fixed rate mortgage, and make sure that your mortgage is no more than 35% of your pretax income.

2) Consider your income. Being overconfident in your income will only get you in trouble when it comes to buying a home. You need to make sure that you’re still able to save money every month in addition to paying the mortgage.

3) Bow to the Unknowns. There may come a time when you decide to have children or change your career. If or when this happens, you need to make sure that you’re not caught up in a mortgage that keeps you from doing what is truly rewarding to you.

4) The 8 Hour Rule. If you can’t sleep through the night because you’re worried about how much you’re going to pay for the mortgage or worried about how to pay for the mortgage you shouldn’t be getting the house. If you have to take sleeping pills to help yourself get to bed at night, then perhaps it’s time to rethink the entire home purchase.

There are three more rules along with much more detail about each tip at the article source at the bottom of the post.

I think that there are a lot of things to consider when buying a home; all of these tips are great. Mortgages are not something that should be entered into lightly and should really be thought about because when you’re unable to pay your mortgage then you’re going to have credit problems for a long time and you will also find yourself in a lot of heartache about what was supposed to be your “dream”.

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On September 15th Ben Bernanke said that the recession is basically over in a statement that rang so loudly, the stock market shot up like a weed after a rainstorm. Well, it was just over half a percentage point for the Dow today, but up is up, right (I really just wanted to use an illustrative language today and that was what came to mind also)?

So, on top of Bernanke’s statement about the recession being over, there was also new data to come out that said consumer sales were up. Sales rose in the past month the most they had risen over a single month in three years.

All of this news put together made for a pretty good day on Wall Street, but the statement about the recession being over was what made headlines that day. So, do I feel like the recession is over or that it may as well be over?

I think we may have seen the bottom. All indicators are pointing to the fact that we have bottomed out. The Dow Jones Industrial Average is well above the lowest point of the year and the overall stock market is doing well. Job losses have slowed down (although unemployment continues to increase). Consumer spending is starting to climb back up, homes are beginning to pick up in sales (and in return the amount of existing homes on the market is finally beginning to decline), and new construction has started once again on projects all across the country. Even auto sales have been kind of stirred after the Cash for Clunkers program.

But before we can all pack up our briefcases and drive to TGI Friday’s for Happy Hour, we have to remember something, it’s not over until it’s over and there are plenty of people out there who don’t have jobs and can’t pay their mortgages. I hate to be a buzzkill for those who felt like celebrating when Bernanke said the recession was basically over, but there are so many things still going on not only in the U.S. but all around the world that show the global recession is not over and that it will be a long road to go down before we actually see the end (and by the end, I mean economic growth like we were seeing prior to the beginning of the recession).

Foreclosures may be on the decline (finally) in our country, but there are a lot of families out there who may be behind on payments and considering foreclosure as their last option. Like bankruptcy, foreclosure will stay with you and haunt your credit score for seven years.

When your home is foreclosed on, your credit score will drop somewhere between 200 and 300 points. Of course, it can’t drop your score any lower than a 340 (the lowest one can get on his or her credit report), but if you have a good score of 700, you could find yourself with a 400 (which is pretty awful).

Your credit score is more than about just being able to get loans. Your credit score is also the key to lower rates on things like insurance and your future job prospects.

If you do go into foreclosure, you want to make sure that any other credit obligations that you currently have stay up to date and paid. If you’re in good standing with your other debt obligations, then the foreclosure looks like a single item and you can start to rebuild your credit score after just a couple of years.

It is so important to make sure that you know all the implications of going into foreclosure. It is one of the things that should be well thought out instead of made in a hasty decision based on panic. There are also ways to avoid foreclosure if you find yourself looking down that road.

You could attempt to negotiate with your lender. After all, most lenders don’t want to foreclose on your home. In a market that is overflowing with houses for sale, the last thing the bank wants is another foreclosure. If you can give your lender a time frame to catch up on payments, they may actually be willing to work with you.

Sometimes you and your lender can reach a forbearance agreement. This agreement can take effect when you have come into a temporary hardship and the lender agrees to lower your payments until you can get back on your feet. Sometimes the lender will even suspend the payments for a limited amount of time.

As part of talking with your lender, another conclusion you may come to is some sort of loan modification. The lender may be able to lower the payments or, once you are able to pay the full price, start incorporating any late payments into the monthly payment. This would keep you from paying a full mortgage payment as well as any delinquent payments on top every month.

For the sixth month in a row, foreclosures in the United States topped the 300,000 mark. Last month a total of 358,471 homes were put into foreclosure by either getting a default notice or by being put on the auction block. The figure is up 18% from August 2008, but it is actually down half a percent from July 2009.

This number totals to 1 in about 350 homes getting a foreclosure notice of some kind.

Morris A. Davis, an assistant real-estate professor at the Wisconsin School of Business had this to say about the foreclosure rate, “The foreclosure numbers are largely unemployment related. As long as 15 million Americans are unemployed, record foreclosures will continue.”

Out of all 50 states, Nevada has been hit the worst. With one in every 62 households in the state getting a foreclosure notice of some kind, Nevada had 17,902 foreclosure notices issued in August. That figure is up 8% from July; contrast that against the half a percent decrease for the country overall and you’ll see that Nevada is hurting.

Following Nevada for the worst foreclosure rates in August was Florida.  In Florida, one in every 140 homes received a notice. In California it was one in every 144.

In the second quarter 2009, one in 25 homes were in foreclosure according to the Mortgage Bankers Association. That is just over 4% of the homes in the United States.

It is easy to tell when a city or state has been particularly hit hard by the recession, falling home prices, unemployment, and foreclosures; all of which are  tied together right now. If you look at the average home price in California and how far the prices have fallen since the beginning of the recession, it is easy to see why most of the homes would end up in foreclosure.

Another problem is the fact that when you take falling home prices and put it together with increasing unemployment. That is a recipe for foreclosure.

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With people moving out of their mortgaged homes and into rentals, it is important to remember that you aren’t insured when you move into a rental. For a relatively low cost, however, you could protect all your possessions and give you and your family a little piece of mind when it comes to leaving your apartment (or whatever rental you happen to have).

According to a study performed by Allstate Insurance (yep, an insurance company doing a study about insurance so I’m not so sure how unbiased or accurate it truly is) said that two out of three college age adults do not have renters’ insurance, or any insurance protection for their belongings. This figure is so important because the same age people say that they have belongings worth more than $10,000. With belongings that cost that much, they also said that if something were to happen to their things, they would be able to replace them or at least some of them.

One of the Vice Presidents at Allstate Julie Parsons said, “It’s a shame because renters insurance is one of the smartest investments people in this situation can make and so few take advantage of it.”

Of course renters should have the insurance because the Bureau of Justice Statistics has reported that those who rent are 50% more likely to have break-ins or experience some kind of theft in their rentals than those who own their own homes.

Getting a quote on insurance is as easy as getting a car insurance quote these days. Once when I looked into renters’ insurance a few years ago, I would have had to go to the insurance agent or actually call them to get a quote. I didn’t especially feel like being hassled by the agent to get the insurance policy (and I’ll tackle this subject in another post), so I never got the insurance (then again, I had NO WHERE near $10,000 in belongings).

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In the United States, home sales finally rose in the second quarter in 39 states. This is one of the factors indicating that the housing market may be perking up a bit after the sub prime lending mess hit it hard.

Quarterly sales for the housing market overall rose 3.8%. This equates to a seasonally annual rate that is 4.76 million. Although the number is around 3% below the same quarter a year ago, the number is up from 4.58 million in the first quarter. The figures have proven to be a welcomed sign by economists who are now saying that the worst part of the housing recession is over and we have hit bottom and are finally starting to see an increase in sales. Even though they say that we’ve bottomed out, foreclosures are still expected to rise well into next year.

Alaska, Wyoming, California, Colorado and Michigan are still being hit pretty hard by falling housing prices and their sales have dropped by at the very least 6% each. However, in states such as Idaho, New York, Wisconsin, and Nebraska, sales have increased 20% or more.

Over the entire country, over 1/3 of the sales that were being reported were from foreclosures and other types of distressed sales in the second quarter.

Hopefully people will learn from all the mistakes they made leading up to the most recent housing crash. If people will learn not to ask for mortgages that they know they can’t afford and banks will learn that they aren’t going to be making money off the people who can’t afford the houses and to stop making out mortgages that are not only deceitful, but also stop “liar loans” then maybe we can avoid the same situation from happening again. Maybe.

The United Kingdom has had some new figures come out that show that there might be some recovery in the housing market in that country. The new figures that have come out show that the annual rate of the decline of housing prices has slowed down to 11.3% from 15%. Right now the average price for a home in the country is 154,016 pounds; the highest housing prices the country witnessed was 186,044 pounds on average and that was in October 2007; a 17% increase from the lowest point seen.

The problem with these prices is that not only did they happen so quickly, but the homeowners are having serious issues dealing with negative equity in their homes. Negative equity happens when the mortgage that the homeowner has on the house is worth more than the actual property is appraised for. This means that if the homeowner wants to move or sell their house, they will not get what they paid for it, and may end up owing the bank even when they don’t live in the house anymore.

Statistics that have been released from the Council of Mortgage Lenders showed that 900,000 homeowners are having problems with negative equity. The 900,000 homeowners equals to 5% of all the homeowners in the United Kingdom. However, of all homeowners in the country, there is around 2 trillion pounds of equity that hasn’t been mortgaged. Again, this figure means little to nothing to those struggling with negative equity in their own homes.

Right now, there is an improvement in the sales to house stock ratio due to fewer houses being listed through real estate agents. There are a few things that are coming together to help with the recovery. First of all, there aren’t as many homeowners that are willing to sell their houses when the property market is at the bottom. Secondly, there are fewer new homes coming up due to the higher risk that is associated by property investment. The National House-Building Council has sown that new property construction is down 53% since just last year.

Overall, it is nice to see some kind of improvement throughout the housing market, not only in the United States but also abroad. There will always be homeowners that overpay for their homes no matter if there is a recession or not. What these homeowners will have to do is hold on to their homes until the equity in the house builds up. Eventually, these homeowners will find themselves in the black.

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Mortgage giant Fannie Mae wants to get its hands on nearly $11 billion in government aid after it posted a huge loss for the quarter. As of right now, the only entity that has gotten more government money than Fannie Mae and its little brother Freddie Mac is AIG. AIG has received $182 billion and with the newest request from Fannie, the mortgage giants would have asked for and received $96 billion. In the last quarter, Fannie Mae posted a loss of $15.2 billion. That equates to $2.67 a share and that total includes $411 million in dividend payouts. Just last year, the company only saw a $2.6 billion loss for the same quarter.

As far as Fannie and Freddie go, the government has said that it will give the companies up to $400 billion if they simply ask because the companies guarantee or own almost half of the mortgages in the United States. They are insanely important to the mortgage market and are partly responsible for the near complete meltdown of the real estate market last year that led to the financial crisis we are in now.

The companies are responsible for 31 million mortgages that total about $5.4 trillion.

This is getting ridiculous. I mean, companies can’t just operate in the red all the time. If this were any other company, it wouldn’t even be a blip on the government’s radar. Instead, because this company was allowed to get as large as it did (and Freddie Mac is backed by the government anyway), the government has to go along and help the company out. At the same time, I do realize before these companies came about, it was much harder for everyday Americans to be able to afford homes.

Because the companies are such a drain on taxpayer dollars at this point, next year there are plans to introduce a new plan for the two mortgage owners. There are several options floating around right now, some of which include winding down operations, making them one federal agency, or taking out the bad mortgages and making the new company backed by the government.

The number of United States homeowners that owe more than their home is worth will likely double to 48% in 2011 from 26% at the conclusion of March. This would lead to another blow to the housing market. This is all according to Deutsche Bank.

Home prices have been on a huge decline and will have the biggest impact on prime loans that have met the underwriting and size requirements of Fannie Mae and Freddie Mac. Prime loans make up 2/3 of mortgages and tend to be less risky because of their harsher requirements for someone to get a loan.

Analysts Karen Weaver and Ying Shen said, “We project the next phase of the housing decline will have a far greater impact on prime borrowers.” Of the loans they are talking about, 41% will likely be underwater by the first quarter in 2011, while only 16% will be underwater by the end of 2009.

The weird thing about this news coming out is that news has been coming out for months that report a stabilization of the housing market after three straight years of price declines. Just this week, the National Association of Realtors said that pending home sales had risen for a 5th straight month.

Also, a very popular index showed (in July) that home prices rose for the first time since 2006 in May.

Of course, the decline in home prices across the country has led to further foreclosures because some people just can’t afford to pay what they owe on the house when the house isn’t worth what they paid. For example, in California are bad. People were paying $500,000 to $1 million for homes that are worth half of what they were when the owner purchased them. The people who bought their houses at that time are the ones facing the greatest losses.

The places that are having the worst negative equity are places in Florida, Arizona, Ohio, California, Nevada, Massachusetts, Illinois, West Virginia, and Wisconsin. Some homeowners in Florida and California will see 90 percent of the homes in their areas with underwater mortgages.

Texas currently boasts two of the nation’s cities with the lowest unemployment rates. With the national unemployment rate being around 9.5%, Houston has a rate of only 6.3%. Recognized for it’s impressive business environment, Houston may be able to provide more than just a job that people can “get by” with, but an actual career they can build upon. Houston is home to 20 of the best large companies as well as 19 of the best small companies in the nation.

Dallas is number two on the list of cities with the lowest unemployment. Some of the country’s top companies are headquartered in Dallas, including Exxon Mobil, Southwest Airlines, and Texas Instruments.

Both cities also have a relatively low cost of living.

Other cities that are a good place to live when you’re trying to build a career are Minneapolis. The city has 3M, General Mills, and PepsiAmericas which all employ thousands of people. Even though the employment rate is 8.7%, it’s still below the national average and those who are employed have a median income of $65,091, which is above the national average of $50,233.

Boston also makes the list, but the cost of living there is higher than the average. The unemployment rate is only 7.2% there as well.

Pittsburgh was number four on the list. The city’s biggest industries (health care, technology, and education) are all recession resistant. The city also has a lower than average cost of living and a $10.8 billion stake in the technology sector.

These are just a few options when it comes time to seek out a new job and you’re willing to relocate anywhere in the country. I find it ironic that, other than Texas, these cities all lie in the eastern United States. I do suppose it makes sense though, because of all the problems with housing and unemployment rates that have been skyrocketing in the western part of the country.