Luxury Market Keeps Moving Strong

Daily Real Estate News  |  March 10, 2008
People with money who can afford to pay big prices for houses continue to do so even though the housing market may be slow for buyers with lesser resources.

Ron Baron, founder of the Baron Funds investment company, last year paid a record $103 million for an ocean-front property in East Hampton, N.Y. He is currently building himself a mansion on the site.

Wall Street financier Philip Falcone recently paid $39 million for a 27-room Manhattan townhouse that was once owned by Penthouse magazine publisher Bob Guccione.

On the West Coast, the 29-bedroom, 40-bath former home of William Randolph Hearst and actress Marion Davies is on the market in Beverly Hills for $165 million, which might be the highest asking price for a home in U.S. history.

“For the ultraluxury market to take a hit, there would have to be serious financial woes that went a lot deeper than what we’re seeing now,” says Rick Goodwin, publisher of Unique Homes, a magazine and Web site about luxury properties. “If they’ve got the money, it’s not going to be a hardship to fork over cash for a $10 million house.”

Source: BusinessWeek.com, Prashant Gopal (03/07/08)

These Cities Are Made for Walking

Daily Real Estate News  

Foot experts at the American Podiatric Medical Association have chosen the best and worst walking cities in American.

More than 500 U.S. cities were evaluated and ranked on 14 walking criteria, including the percentage of adults who walk to work and the number of parks per square mile.

Here are the 10 best cities for walking:

Cambridge, Mass.
New York City
Ann Arbor, Mich.
Chicago
Washington, D.C.
San Francisco
Honolulu
Trenton, N.J.
Boston
Cincinnati, Ohio

Here are the 10 worst cities for walking:

Oklahoma City, Okla.
North Las Vegas
Gadsden, Ala.
Davenport, Iowa
Mount Pleasant, S.C.
Enid, Okla.
Laredo, Texas
Springdale, Ark.
Clarksville, Tenn.
Lafayette, La.

Source: The American Podiatric Medical Association and Prevention Magazine (03/04/2008)

Disgruntled Buyer Sues Buyer’s Agent

Daily Real Estate News  |  January 22, 2008

What are the responsibilities of buyer agents? A case being tried next week in North County, Calif., Superior Court will help decide that question.

Buyer Marty Ummel is suing her buyer representative saying he hid information about what similar homes in the neighborhood were selling for because he feared she would back out and he would lose his $30,000 commission.

The defendant in the Ummel case is Mike Little, a veteran practitioner with RE/MAX Associates. He will argue that Marty Ummel, who brought the case with her husband, Vernon, is trying to shift the blame for the couple’s own failures of research and due diligence.

”They simply didn’t do what is expected of a knowledgeable, sophisticated buyer, and are now looking for someone other than themselves to take responsibility,” Roger Holtsclaw, an associate who was hired by Little as an expert witness, said in a court deposition.

The Ummels discovered after they moved in that neighboring houses with similar amenities had sold recently for as much as $100,000 less. Their original suit included the appraiser, who was accused of skewing his report to make the Ummel’s house seem worth the purchase price, and the mortgage broker. Modest settlements have been reached with both.

”I do not think I’m obsessive-compulsive, but I am 114 pounds of absolute perseverance,” says Ummel, who has spent a year picketing the RE/MAX offices on weekends.

Little called the case ”ridiculous,” adding ‘The lady’s a nut job. I didn’t do anything wrong.”

Source: The New York Times, David Streitfeld (01/22/08)

30K FEE!??…………..I’m doing business in the wrong state!  lol

Ownership: Rules to Make Nice With Neighbors

Rowdy neighbors. Filthy neighbors. Neighbors who never speak.

Some neighbors are boors and it can affect property values, says Deborah Ford, director of the bachelor of science program in real estate and economic development at the University of Baltimore.

“There are strict laws about housing discrimination, so [real estate practitioners] can’t do or say anything that would deter someone from moving to a community,” Ford says. [But, “if people get tired, some of them will decide, ‘I’m moving out.'”

Johns Hopkins University professor P.M. Forni, founder of the Johns Hopkins Civility Project and author of the book Choosing Civility, says he has always found it fascinating that the word “rival” comes from a Latin word for “neighbor.”

Now writing a follow-up called The Civility Solution: What to Do When People Are Rude, Forni offers these neighborly tips from his upcoming book:

When walking your dog make sure that your pooch does not stray onto your neighbor’s lawn. Clean up after your pet.

Do not schedule grass-mowing or leaf-blowing before 10 a.m. on Saturdays or Sundays.

Let your neighbors in the apartment building or cul-de-sac know when you are planning a party with multiple guests. Apologize in advance for any parking-related inconvenience that might occur.

If you have planned substantial renovation work, send a note to your neighbors with beginning and ending dates of the project and the daily working hours. Assure them that you have instructed your contractor that there must be no spilling over of the site onto neighboring properties. Include in the envelope two carwash gift certificates apologizing for the inevitable dust. Send an e-mail to neighbors to give updates or get feedback about how your contractor is doing.

Source: The Baltimore Sun, Donna M. Owens (01/13/2008)

Rent to increase/ home prices to decrease?

Daily Real Estate News  |  January 4, 2008

Rents Must Rise to get in Sync With Home Prices
The benchmark ratio of rents to home prices is slowly returning to its long-run average but it could be at the expense of home prices, according to a study by Federal Reserve Board economists and a University of Wisconsin professor suggests.

The ratio, which compares imputed rents of home owners to the value of owner-occupied housing, is a valuation of residential housing that is equivalent to the earnings-price ratio used to value stocks.

The rent-price ratio ranged between 5 percent and 5.5 percent between 1960 and 1995 but fell rapidly after that, hitting a historic low of 3.5 percent by the end of 2006 as home prices grew rapidly.

In the first half of 2007 the ratio started to climb again, and incoming data suggests that the rent-price ratio has continued to increase, the authors note.

The study, however, suggests housing prices would have to fall 15 percent over five years, assuming rents rose 4 percent a year, to be back in sync.

Economist Morris Davis of University of Wisconsin-Madison says that “rapid growth in rents” is crucial to justify the current level of home prices. However, he adds, an increase in unsold properties on the rental market could hinder rent increases.

Source: Reuters News and The Wall Street Journal, Greg Ip (01/03/08)