JULY 15, 2008 

THE NUMBERS TELL THE STORY 

There isn’t a buyer in the market today who doesn’t want a good deal. 

Everyone knows that the Outer Banks market has swung to the buyer’s favor, and it’s been that way for some time. 

Not everyone, however, knows that even in the midst of a strong buyer’s market like this one, getting a good deal is not guaranteed. 

It all depends on which agent you use. 

How much does it matter which agent represents you? 

Well, the numbers tell the story… 

Most properties on the Outer Banks are closing around 95% of the asking price. Some buyer’s agents are closing properties at 92% of asking price. 

In 2008, I am averaging closing at 82.5% of asking price for my buyer clients. 

I’m consistently beating the market, with every buyer side transaction.  

91.5% of asking price is the highest one of my buyers has paid in 2008. That's the highest, folks...  

76% of asking price is the best deal I’ve put together… (That one really was sweet.) 

Not every agent is alike, and the difference in agents may save you… or cost you… thousands of dollars. 

The numbers do indeed the story tell. 

JULY 17, 2008 

GOING UP IN SMOKE! 

These are interesting days… 

While some people are glued to their TVs or computer screens, waiting for the next round of bad news, many others are out buying real estate. 

Affordability is at a five year high… 

Interest rates are good… 

And buyers are following their gut instinct, which is telling them that the best time to buy real estate is when everyone else wants to sell. 

Want to know something that you’re not hearing on TV? 

The National Association of REALTORS © is reporting that the median home price has risen each month for the last four months! 

That means that nationally, home prices are increasing, and have been for the last 120 days. 

The median price is pushing higher because the average American is out in the marketplace.  

They are out buying a house for the first time, or perhaps a young family is trading up, or an older couple is scaling down for retirement, or a couple in their forties or fifties is buying a second home at the beach… 

Recently, I saw an article that had been printed in the Wall Street Journal which stated that that the bottom of the housing cycle may have occurred in April 2008. 

If this trend of increasing median home prices continues, it may well be that the bottom occurred even sooner, perhaps as early as February 2008. 

Whether it turns out that the bottom occurred in the winter or spring isn’t that important. 

What’s really key is that the data is beginning to indicate that the bottom has already occurred…and that we are now moving past it. 

So. 

Fence-sitters, what you may have occasionally smelled on the Outer Banks this summer isn’t just the fire that’s been burning. 

It’s also the smell of opportunity going up in smoke.  

Your days to get a smoking hot deal are numbered, my friends. 

The longer you wait, the more you will pay. 

And that is not just an opinion; turns out, that’s been a fact. 

For about 120 days now. 

JULY 15, 2008 

IS REAL ESTATE LOOKING GOOD TO YOU? 

If it is, you’re not alone… 

While some people are wringing their hands, worried about the state of the economy in general and Fannie and Freddie in particular, there are other people who see this point in time for what it really is: 

A changing of the guard. 

Stocks are retreating, and as they do, real estate will begin advancing. 

Don’t buy into the media hype that real estate is in the toilet everywhere. 

It isn’t. 

In fact, there are 5 zip codes in California, a state that has been truly devastated by the market correction, that have done an about-face in 2008. In these areas, homes have begun appreciating again. 

Most of these areas are coastal.  

There is a tremendous amount of wealth in this country that has been patiently sitting on the sidelines, waiting for this very moment to arrive. 

Many of the people who are investing in our market now are paying with cash. Most of my clients are either at or near retirement age, and many they tell me that they’ve spent the last 30 years getting out from underneath the bank. They say that they certainly don’t intend to go back into hock now, at this stage in their lives. 

What happens to Fannie or Freddie doesn’t affect their real estate purchase. 

These people are buying now because they sense the opportunity… 

Do you sense it too? 

APRIL 11, 2008 

THE BIG PICTURE 

Three years ago, I bought a little place in S. Nags Head. It was an older home, in desperate need of renovating. I enjoyed fixing up that little cottage, and each time my parents came to check on the progress, Dad would take pictures. I didn’t realize it at the time but he would get those pictures developed and show them to anybody who happened to come by their house.  

My reason for buying the cottage was simple: Mom and Dad were getting older, and while their health was good, I could do the math. I knew we didn’t have much time left. 

The first time we were all together at the cottage was magical. My brother Dave brought his family, and we thoroughly enjoyed watching Dave and Amy’s boys splashing in the pool. It was an occasion that we talked about over and over again. Dad’s face would light up each time he recounted one of the stories from that first trip.  

And every time we were there, it was the same way. Wonderful memories were made at that beach house. Memories that will now have to last me the rest of my life. 

You see, my father died last Sunday morning, quite unexpectedly of a massive heart attack. I had just spoken to him the day before on the phone. One day later, and he was gone. 

All week long, as relatives have visited with our family, memories about times we were at the cottage surfaced one after another. My first cousin and his wife were down for a fishing trip once, and the group consisted of Tommy and Libby, along with Mom and Dad and me. Although we needed to be up early the next morning, we stayed up nearly all night long, and that night we spent together was one of the best times of my life. I have never seen my father laugh as hard as he did that night. We were all in tears before it was over. It was another magical snapshot in time, and a memory now that I will use in difficult moments to get me through. 

Today, as I look back on it, I am so very, very grateful for that little beach house. I have a cottage full of memories that I wouldn’t trade for all the money in the world. 

As a result of my Dad's passing, my view of the market has shifted substantially this week. 

Timing has taken on a whole new meaning. 

Most folks have been entirely too concerned with trying to time their purchase so that they are buying at the bottom of the bottom of the cycle. 

(As if anyone can actually do that...) 

Meanwhile, days, weeks, months, seasons are ticking off the calendar. 

Seasons that you can't get back. Seasons that you can't replace. Seasons that are gone forever, taking the memories that could have been made with them. 

Perhaps it's time to rethink the concept of timing your real estate purchase to include making the most memories with your family, and enjoying the most time with them that you can. 

I promise you that your biggest regret in life will never be that you missed timing the market at its lowest point - it will be missing time with your family. 

If you've been thinking about buying a place at the beach, you can feel secure in your decision to buy now. You know that prices are low. You know that you have a lot of homes to choose from. You know that interest rates are very favorable.  

Make the most of this incredible buying season while you can. Seasons pass away, you know. (*Note: July 15, 2008 Thank you to everyone who expressed their sympathy during this time. It took awhile to come to center again after Dad's death, and the lack of blog posts clearly reflect that. I'm back writing again, and it feels good. Just wanted to say a quick thanks to everyone, it meant a lot to me.)
 

APRIL 2, 2008 

WOULD YOU LOOK IN THE REAR VIEW MIRROR TO SEE WHAT’S COMING AHEAD? 

It’s an interesting thing. 

Who do you know that would get in their car and look behind them in an attempt to move forward safely? 

Yet, many folks look in the rear view mirror in an attempt to move forward safely in real estate. 

I remember one night in high school, I was a sophmore, out on the town on a Friday night. We were all parked in our usual spot, underneath the Sears sign in the parking lot. We’d hang out and talk, waiting for our friends to join us before heading off to the movies, or to bowling, whatever we had planned that night. 

This particular Friday night, we didn’t have anything planned. So we just hung out right there, underneath the Sears sign. 

The hours passed too quickly, and it was late when I finally noticed the time. It was really late.  

I had to get home, but fast. 

So, I asked a friend to move his car. I didn’t think I could get out the way it was parked. 

He said, “Oh for Pete’s sake. I could do that with my eyes closed.” 

Once more, I asked him to move it. I was in a hurry to get home. 

He didn’t. 

I started the car, and looked in the rear view mirror. 

He told me I’d gone back far enough, to put it in drive and that he would guide me. 

I was still looking in the rear view mirror when I put the car in drive and accidentally hit the gas instead of the brake. 

Well, that’s as far as I want to go with this story. Let’s just say that it didn’t go well. Not for the car, and not for me. 

You would expect things not to go well, looking in the wrong place, wouldn’t you? 

If you look in the wrong place, you shouldn’t expect to find your missing keys.
If you look in the wrong place, your misplaced briefcase will continue to elude you.
If you look in the wrong place, you can’t find whatever it is that you’re looking for. 

Well, when you look at the media for guidance as to when you should buy or sell real estate, you are most definitely looking in the wrong place. 

And nothing good can come from that. 

When the media is your barometer, you are always looking in the rear view mirror to see what’s coming ahead. 

You don’t need the media to tell you what to think. 

Think for yourself. 

If you think it's time to buy, then simply take the next step.
 

MARCH 24, 2008 

WOULD YOU USE A 17 LB GOLD NUGGET AS A DOORSTOP? 

On a picture-perfect Sunday afternoon in the early 1800’s, a 12 year old boy who preferred exploring in the woods to being stuck inside church, walked along the banks of the Little Meadow River just outside of Charlotte, NC… 

As he walked along, something gleamed to him from the water. Curious as to what had caught the sun’s rays, he waded in for a closer look… 

This young boy picked up a rock that shone like the sun. It sure was heavy. He struggled to carry it home to his family, hoping they would know what it was. Exhausted from the effort, he put the rock on the table, eager to be told what he had discovered in the river bed.  

He searched each face as he looked at his family. But no one knew what it was. 

In fact, the family had no clue as to its value, and weren’t sure what they should do with it. One family member suggested that since it was so heavy, it might make a good doorstop. 

And so, for the next three years, the Reed family used a 17 lb. gold nugget to hold open their door. 

When they finally took it to a jeweler, he lied to them about its worth. He purchased the nugget for a paltry $3.50. At the time, the nugget was worth around $3600. 

Word spread like wildfire that gold had been discovered in North Carolina. Almost overnight, thousands of people poured into the area around Charlotte, intent on making their fortunes… 

Real estate markets often start and stop on a dime. The reason why can be explained by the same phenomenon experienced during the North Carolina gold rush. 

When something good comes along, it doesn’t take any time at all before everybody wants to get in on the action. Everyone jumps on the bandwagon at nearly the same time. Everybody wants their piece of the pie. 

The buyer’s bonanza that presently exists on the Outer Banks is similar to the gold rush in many respects: 

a) There are opportunities here just waiting to be picked up.
b) There are still relatively few folks out looking around.
c) For those who are, they are being rewarded… right now. (This is that Sunday afternoon, in other words..)
d) Once the word gets out, watch out. Everybody will want their piece of the pie. Or the nugget, so to speak.  

And please don’t think poorly of the Reed family. It’s easy to sit on this side of history, nearly 200 years later, and laugh at their inability to recognize an incredible opportunity when it was right there, staring them in the face. 

Why, that very thing is getting ready to happen again… to the buyers who scoff at present opportunities…to the ones who need to wait for someone else to be first…to those who end up staring at a good deal and not recognizing it for the opportunity that it is. 

It happened just that way back in 2000-2001. And it's happening again. 

They say hindsight is 20/20, and everybody's got it. 

But foresight? Ah, that's the thing...  

MARCH 4, 2008 

YOUR INVESTING STYLE DETERMINES WHETHER YOU GET ON BASE OR STRIKE OUT 

I grew up a middle child, the only girl with two brothers. As a result, I gravitated towards the activities that my brothers enjoyed, especially my older brother Steve. 

Steve was a natural athlete. He was an excellent baseball player. My parents took me along to watch him play every game. 

The nights were usually cool. Even in the summer months there was typically a breeze. And the wind carried excitement on its wings, as the teams headed out to warm up, anxious to get underway. 

The night lights fascinated me, and the field seemed to go on forever. I drank in each detail – every sight, every sound, even the aroma of the often-burnt popcorn coming from the concession stand. 

Whenever Steve came up to bat, the whole world seemed to hold its breath. Or was it just me? 

I used all of my powers to mentally will that ball to go out of the park. I imagined him hitting one home run after another. My brother was going to win Most Valuable Player. Move over, Babe. Make room for Steve. 

But it didn’t happen that way. 

Instead, Steve would almost always hit a single. Sometimes a double. He’d round first or second base with a grin from ear to ear. 

I remember asking him once why he couldn’t hit the ball very far. I was disappointed that he wasn’t the home run king yet. All of my mental efforts had failed. At this rate, he would never win Most Valuable Player. 

His answer resonated at very deep levels within me. Even though a child, I saw the wisdom in it. 

Smiling, Steve said, “Holleay, I’m not trying to hit a home run. When guys swing for the moon, they strike out. I’m helping the team more by just getting on first and then running the bases. The way to win is to get on base.”  

“When guys swing for the moon, they strike out.” 

“The way to win is to get on base.” 

There are two types of buyers in our marketplace: 

Those who are swinging for the moon and those who are getting on base. 

The buyers attempting to swing for the moon are making not one, but a series of errors: 

First, they are not recognizing that now is the time to buy. They want to time the market and buy at the bottom, and this irrational desire will cause them to wait. The bottom will come and go, and still these buyers will not know it. And they will have missed the very thing they most wanted, an excellent deal.  

Second, those swinging for the moon are under the false impression that sellers will take impossibly low offers. Because their expectations are so unreasonable, their offers are typically rejected outright, with the sellers not even bothering to counter. They are not taken seriously. 

Third, many moon swingers are not content to buy within their means. One of their chief goals appears to be to impress friends and family, so they end up trying to bite off more than they can chew. They want to buy more than they can really afford. And since they can only qualify at the impossibly low-ball price, they don’t have the room to negotiate a deal out to where it can work. 

All of these errors in judgment leave them to conclude that other people are simply making bad investment decisions. They don’t realize that it is their unreasonable desires that have kept them out of the market. Nothing else.  

“When guys swing for the moon, they strike out.” 

Fortunately, there’s another type of buyer in our marketplace. This is the fellow who realizes that the important thing is getting on base. 

He’s not out to impress anyone. He’s out to make a smart investment decision. 

This buyer structures his deal in a way that sellers take notice. This buyer comes looking like a bird in the hand. This buyer is seen as serious, and is taken seriously by sellers. 

And this buyer is stepping forward and buying Outer Banks real estate. He knows what he’s got, and he is very pleased with his decision to purchase.  

“The way to win is to get on base.” 

Remember, your investment style will determine whether you get on base…or strike out. 

Which one is your style? 

FEBRUARY 5, 2008 

A LITTLE COURAGE GOES A LONG WAY OVER TIME 

Thank you to everyone who contacted me about yesterday’s post: 

Thank you to the folks whose light bulb just went off.
Thank you to the folks who are still questioning, but listening rather intently.
Thanks even to the nay-sayers, who say that we’ll never see values increase again. 

Never? 

Wow. Never is a really long time. 

Fortunately, we have history, which reveals that a little courage goes a long way over time. 

You don’t have to buy property and wait forever to see significant gains. 

If history is any indication, 25 years should just about do it. 

Take a look at these two examples: 

In 1979, you could have bought an oceanfront lot in the Whalehead subdivision of Corolla for $46,000. 

Now, $46,000 was a lot of money back then… 

…and times were tough. The oil crisis of 1973 was a harrowing time to live through, and on its heels came the energy crisis in 1979. Inflation was out of control, unemployment had risen to dizzying heights, and if you recall, interest rates at the time were a staggering 21%. The Fed intentionally plunged the country into a deep recession in 1980 in an effort to eradicate inflation. 

But if you had the money (and the courage), and if you had bought that oceanfront lot in 1979… 

…then in 2004, you might have thought about selling that lot, as others just like yours were selling between $1.8 and $1.9 million. 

That’s right:  

A $46,000 investment, made during one of the worst economic periods in recent history, returned nearly $2 million. 

And it didn’t even take forever. 

In fact, it only took 25 years! 

Ready for another example? 

The year is 1984. 

You want to buy a semi-oceanfront lot in this same subdivision in Corolla. 

The price? 

A cool $1,000. 

That’s right: 

One thousand buckaroos. Now, $1,000 was a lot of money in 1984… 

…and times were tough. The country was coming out of a deep recession, the Fed was in the early stages of loosening its stranglehold on monetary policy, and commodities were just beginning to feel the effects of what would be a 20 year slide in decreasing prices.  

But if you had the money (and the courage), and if you had bought that semi-oceanfront lot in 1984…

Then in 2004 -2005, you might have considered selling, as lots just like yours were selling between $875,000 and $1.1 million. 

That's right: 

A $1,000 investment, made during a bleak economic period, returned close to a million dollars. 

A mere 21 years later. 

Yesterday I wrote about a lot that had been purchased on the Westside of Kill Devil Hills in 2001 for $12,000. (If you missed it, just scroll down.)

Do you recall what things were like back in 2001? If you remember… 

…times were tough. The dot-com crash had millions of baby boomers reeling, as their stock portfolios plummeted. Then there was the day the Earth stood still – the attacks of September 11 were devastating on every level. And 2001 marked the year we lost faith in Big Business, as one accounting scandal after another rocked the nightly newscasts. 

But if you had the money (and the courage), and if you had bought that lot on the Westside of Kill Devil Hills in 2001 for $12,000… 

…then in 2005 or early 2006, you might have considered selling it, as lots just like yours were selling around $170,000.  

And even if you missed timing your sale at the height of the cycle, you would have still done pretty darned well. This seller sold his lot a couple days ago for $102,500. Significant gains from a 7 year hold, wouldn’t you agree?  

So. 

Here we are in 2008… 

…and times are tough. The stock market’s schizophrenic, the country may already be in a recession, and the subprime mortgage mess is well, still a mess. 

But if you have the money (and the courage), you could buy a property on the Outer Banks.  

Because you see, history reveals that a little courage goes a long way over time. 

FEBRUARY 4, 2008 

WHEN HISTORY REPEATS, WILL YOU BENEFIT OR WILL YOU KICK YOURSELF? 

Real estate is cyclical. We all know that. 

Because we all realize that fact, many folks have kicked themselves (at one point or another) for not having bought in 2001, before the market took off… 

And here we are again. Right smack in the middle of another 2001-ish part of the cycle.  

Everything is repeating itself:  

Prices are low
Rates are good
And there are plenty of properties to choose from 

Everything really IS repeating itself…because there are opportunities as far as the eye can see, and relatively few buyers. 

Just the way it was back in 2001… 

So it looks like history is indeed about to repeat itself once more. 

And so, in the near future, many folks may soon be kicking themselves again for not having bought in 2008, when… 

Prices were low
Rates were good
And there were plenty of properties to choose from 

Personally, I’d really like it if we could change one part of this cycle: I’d really like for there to be a lot less kicking going on this time around. In fact, nothing would please me more than if your future was kick-free. 

This morning I looked in the multiple listing service (the mls) and saw that a lot on the Westside of Kill Devil Hills had just sold.  

This is a typical lot, in a typical neighborhood on the westside. It’s just your basic run of the mill interior lot. Nothing special about it. Average in every way. Got the picture? 

This seller bought the lot in 2001 and paid $12,000.  

Similar lots in this same neighborhood sold for $55,000 in 2003. 

In 2005 and early in 2006, similar lots were closing around $170,000. 

(Bet you’re wondering what the lot that just closed sold for)…. 

Okay, I’ll tell you. 

It sold for $102,500 in 2008. 

This is where it gets really interesting: 

As you read this, what are you thinking? 

If you’re reading this and you’re seeing the opportunity, if you’re reading this and seeing the benefit of buying early, then you just heard the message… 

The benefit of buying early while prices are low is that by buying early in the cycle, there is a tremendous cushion that serves you very well, regardless of where the cycle is when you go to sell. 

No question, that seller would have made a bundle if he’d sold his lot in 2005. 

Fact is, that seller still made a bundle selling his lot in 2008. 

You see, if you buy late in the cycle, there is little to no cushion for you when the market turns and corrects. 

For example, if you waited (as many folks did) until 2005 to buy, you probably would have paid somewhere around $170,000 for a lot like this one. 

Because you bought at the top of the market, there was really nowhere to go but down. 

And down the escalator went. 

Down, down, down. 

To its present level, where a lot like this one is now worth a little over $100,000. 

Now then, back at the ranch… 

If you’re reading this and you’re saying to yourself that you should have bought in 2001, and that now you’re going to wait until prices come down to the 2001 level again, then… 

…you’ve missed the point entirely. 

Not only have you missed the point, but you are unlikely to buy property on the Outer Banks. Not this year, not next year. More than likely, you will never buy property here. 

Sorry.  

I don’t mean to sound harsh. 

But I’ve talked with a lot of people over the years. 

There are people who see opportunity, and then there are people who simply cannot see it. Opportunity can be all around them, but since they just can’t bring themselves to act on it, they choose not to see it.  

Some people benefit, others kick themselves.  

Well, here we are, folks. 

Opportunity is knocking. 

Opportunity is knocking again. 

Opportunity is nearly beating the door down. 

The only question is, when history repeats, will you benefit? 

Or will you kick yourself? 

FEBRUARY 3, 2008 

THE SECRET TO WINNING IN REAL ESTATE 

When I arrived at my office this morning, I found a note from one of my clients in my inbox. 

Reading through it, I was struck by the thought that winning in real estate is easy. 

You see, the most important decision you'll make in real estate is who you're going to work with. When you find the right agent, everything seems to fall into place. Things go smoothly. It appears effortless. 

Over the years, I've inspired a number of people to get their real estate licenses. They say that it's because I make it look so easy. 

My response to that statement is always the same: "It IS easy, when you know how." 

Have you ever watched a professional sports game? Professional athletes make what they do seem easy. 

I remember watching Chris Evert play tennis. She was so cool, so calm, so matter-of-fact as she systematically beat her opponents, one point at a time. 

I sat spell-bound watching Michael Jordan playing in the biggest game of his career. He moved with grace and ease as he shot with such precision that it deflated the opposing team.  

Professionals in every endeavor make what they do seem easy, simply because they are good at what they do. 

The secret to winning in real estate? Work with the right agent. Because it's always easy, when you know how. 

Thanks, Barrett and Shay, for your note. I feel blessed to work with you, and to have a hand in helping you with the next stage in your family's life is a thrill for me. 

"We discovered Holleay's website and sent her a few questions regarding a listed home. Holleay's initial email response was surprising in its depth and its thoroughness. 

"These email exchanges continued and we soon came to realize that we had found our agent. 

"Holleay is a true full service real estate agent in every sense of the word. She'll surprise you and you'll be disappointed working with other agents after having worked with her. 

"Holleay's a masterful negotiator - the kind you want working for you in your corner representing your interests. She focuses her abundant energy and enthusiasm to find and negotiate the very best deal possible.  

"Moving a family of 5 (including 3 young children) from 'big city' Charlotte to the Outer Banks is no small decision. 

"On our first trip to the Outer Banks (we had never been before) Holleay served as our 'ambassador' showing us the area's unique qualities and relatively unknown neighborhoods. 

"She developed a strong and accurate sense of who we were and what we were looking for and instinctively knew the right area for us even before we had seen it. 

"We were most impressed. 

"However, she does have limited powers as the weather during our first visit was less than ideal. :-) 

Holleay knows more about the Outer Banks than many natives. Her depth of knowledge helped put us at ease and provided us with an education we didn't expect. We had our minds set as to our 'game plan' but Holleay presented other options for us to consider which made more sense.  

"We couldn't be happier with Holleay as our 'full service' real estate agent and will continue using her services for our future real estate transactions." 

Barrett & Shay Crook
Charlotte, NC
(but soon to be Kitty Hawk, NC!)
 

JANUARY 25, 2008 

TOO GOOD TO LAST 

The cavalry is coming. 

Who’s leading the charge? 

Why, the U.S. Government. The stimulus package that is all but guaranteed is the result of a bipartisan effort. Imagine that. Democrats and Republicans, in the middle of an election year, with so much at stake politically, are joining forces to stimulate the economy. 

The Bush White House is part of the cavalry, too… 

…and so is the Federal Reserve, whose unprecedented ¾ pt rate cute this week showed their willingness to do whatever has to be done to avert recession. 

Part of the stimulus plan being discussed includes increasing the conforming mortgage loan limits from the limit of $417,000 to up to $730,000. Under this plan, FHA loan limits would increase as well.  

The savings in interest could be substantial to qualified homebuyers, perhaps as much as $3000 to $5000 per year. 

This part of the stimulus package is short-term, however, meant to stimulate buyers who have been waiting (and waiting…and waiting) for some sign that ‘now is the time to buy’. 

Folks, here is the sign. Here it is!  

And if this package is approved by the Senate and the White House, then the ‘buy signal’ will flash until December 31, 2008. Then the higher loan limits may very well be a thing of the past. 

Here on the Outer Banks, however, we have narrower window than year-end. Rents are about to kick in, you see. If you want the most help in carrying your new beach house in 2008, then you must buy and close prior to the first rentals. 

Every week that you wait to close is another week’s worth of rental income that you’ve just put in the seller’s pockets. 

Remember that it typically takes 30 days to close on a home once you go under contract.  

So, if you want to close by May 1st, you will need to be under contract by April 1st.  

Folks, it’s practically February… There are exactly 66 days between now and April 1st. And just 9 weekends. 

The U.S. Government is paving the way for you to own a home with the most favorable rates in recent history. When this stimulus package is approved, there will be a pile of goodies on the table for buyers. 

And the buyers will come. 

When they come to the Outer Banks to take advantage of this incredible opportunity, the increased activity will: 

increase mortgage applications… 

as homes are coming off the market and selling… 

which means that inventory will be reduced… 

so there will be fewer homes to choose from... 

which means that sellers won’t be so quick to accept lower offers… 

and the best deals are going to be gone sooner rather than later.  

Considering the purchase of a new home? 

Consider this... 

When builders have plenty of contracts in hand, they will not be so quick to offer incentives to buyers. Gone will be the ‘freebies’. Gone will be their wooing of buyers with upgrades. 

The stimulus package is flashing the ‘buy signal’, but at the same time, it’s sounding the death knell for the buyer’s market.  

Better hurry, folks. 

These prices, these rates, these terms, these opportunities – well, it’s all just too good to last. 

JANUARY 22, 2008 

THE SMART MONEY 

If you’re anywhere in the civilized world today, then you’re probably aware of the fact that the Fed has just stepped in to cut interest rates ¾ of a point – and will undoubtedly reduce them again when they meet at month’s end. 

Savvy real estate investors are cheering present market conditions. Not only do they get to buy at heavily discounted prices, but their carrying costs have been reduced as well. 

It’s like Christmas in January! 

Let’s take a brief stroll down memory lane to help you put all of this into perspective. Perhaps you recall the dot com stock market crash? (If you’re a baby-boomer, oh, you remember. How could you ever forget?) 

Those were tumultuous days indeed. Millions of baby boomers watched as the stock market had risen, breaking new ground month after month, year after year. Finally, after years of seeing others reaping the profits of a runaway stock market, many boomers felt it was safe to put their money in... 

Only to find that they had waited too long, as the stock market quickly turned and crashed, taking their hard-earned money with it. The wait to find a comfort level before entering the stock market proved to be quite costly. 

But an interesting thing happened right after the stock market crash. 

Millions of boomers began looking to invest in real estate. During 2001 and 2002, almost every conversation I had with a baby boomer aged buyer went something like this:  

“I got in the stock game too late. I bought high. Then it crashed. Now I’m worth less than I was when I went in. 

“I’m in my forties. My retirement plan has taken a direct hit. The way I see it, if I don’t find an investment vehicle that will make me whole, then I have three options: 

a) I will have to retire later than I had planned.
b) I will not be able to live the lifestyle I had planned.
c) I may have to work longer and do without the things I wanted to be able to do. 

“None of these options interest me. I’ve worked hard all of my life. I deserve to retire early and live well. I want to buy some real estate, because I believe it’s going to go up. I want to catch the real estate market right now, before it rises, and make my money back, and hopefully, even more.” 

The stock market bust fueled the real estate boom, folks. 

Déjà vu all over again? 

Well, you know the old saying: 

“The smart money leaves stocks first, and the smart money enters real estate first.” 

JANUARY 5, 2008 

FORECLOSURES ARE ALWAYS THE BEST DEALS AND DIAMONDS ARE RARE 

Yes, I know. That is a rather odd title. But keep reading. I think you’ll agree by the end of this article that the title is fitting. 

Let’s start with diamonds: 

The world’s biggest diamond conglomerates control the world’s supply of diamonds. Through their ingenious marketing, they have convinced us all that diamonds are rare. We perceive that diamonds are rare because they are not plentiful. But the truth is that diamonds are not rare at all. 

It’s been said that there are so many diamonds that every man, woman and child in the world could hold a cupful. A cupful! 

So why do we automatically believe that diamonds are rare? 

Because the diamond conglomerates release a very small amount of diamonds each year into the marketplace. Since they control the supply, they keep the demand (and prices) high. And they spend millions each year in advertising to convince us all that diamonds are worth their price, because they are so rare (ie, not plentiful). 

Getting a feel for how this works? 

Okay, let’s turn our attention to the foreclosure market.  

People automatically believe that when a bank puts a property on the market, that the bank is willing to give it away just to get rid of it. After all, banks aren’t in the business of real estate - they are in the business of lending money, right? 

Well….just stop and think about that for a minute. Do you really believe that a bank is willing to give away a piece of real estate? The perception is that these properties are the best deals on the market, but perception is not always reality. (Diamonds are rare, remember?) 

It’s an interesting phenomenon – perception vs reality in the real estate market. 

I’ve seen properties come on the market where the seller’s asking price was less than what the bank put the house on the market for when they took it over. I’ve seen buyers flock to bank-owned properties and ignore the better deal right down the street. Right down the street!  

The perception is that a foreclosure is a steal. Even though that perception frequently flies in the face of reality, many people not only believe it, they cling to this idea as though it was a holy grail. 

Why? 

Because people are afraid of making a bad decision. Oddly enough, it is their fear of being wrong that sets them up to make at best, a less than optimal decision, and at worst, a very bad decision indeed. 

People who are afraid of making a bad decision will not buy in a buyer’s market. They refuse to take advantage of low prices and low rates. Their fear blinds them to the best opportunities, to the best deals… 

These people need to see others buying before they will buy. They need to see their friends buying. They need to see the newspapers and TV reporting that now is the time to buy. They need to see improved market conditions. 

But when market conditions improve, the buyer’s market is over. 

That’s why they are unable to profit from a buyer’s market – by the time they start to feel that it is safe for them to buy, the market has long since shifted from the buyer’s favor back to the seller’s side. 

The best deals are gone. 

The moderately good deals are gone. 

In fact, they may have waited so long to buy that now, they are buying at the top of the market, when properties are overpriced and their values cannot be sustained. 

It is the fear of making a bad decision that makes people believe that a foreclosure is automatically the best deal on the market. They need to feel safe, so they tell themselves that a foreclosure must be the best deal.  

Now, I’m not saying that some foreclosures aren’t real buying opportunities. I’m not saying that at all. 

What I am saying is this: 

All that glitters in the foreclosure market may not be a diamond. 

JANUARY 2, 2008 

IT DOES NOT TAKE A VILLAGE TO MAKE A GOOD REAL ESTATE DECISION 

When you come to the beach on vacation, and you cross the bridge onto the island, you immediately feel a sense of relief. It’s almost as though the bridge has separated you from all of your cares and concerns…and you know that for the next several days, your time is your own. You can do as much or as little as you choose. And knowing that the choice is yours feels good, doesn’t it? 

You know that your vacation can be anything you want it to be. You can spend your days exploring all the historical attractions that the Outer Banks has to offer. You can peruse the quaint shops for just the right item to take home with you. You can spend your time relaxing by the beach, lulled by the timeless sounds of the ocean and the gulls. 

Only you know how to spend your time at the beach in a way that is most beneficial to you. And you know that each time you visit, you may wish to spend your time here a little differently. Sometimes you will want to decompress and you may not venture out much at all. Other times, you may hit the beach wide open to discovering the out of the way places that only the locals know about. 

The point is this: when you come to the beach on vacation, you don’t first consult the newspaper or TV to hear what the talking heads have to say about how you should spend your time. They don’t have a clue what’s right for you and your family.  

You know what you want out of this vacation, and you plan the trip that’s right for you. And your visit is everything you could have asked for. When it’s time to return home, you leave with a car full of memories and a renewed spirit.  

Why not approach your real estate decisions in the same way? 

I hear from people all the time who want so much to own a home on the Outer Banks. For years, it seemed a dream that was always out of reach for one reason or another…the kids were young and involved in after school activities…then the kids were going away to college and the reality of tuition kicked in…it seemed that there was always something that got in the way. 

The years have passed, and for millions of baby boomers, this scenario has changed dramatically. The kids are out of school now, and are living their own lives (well, more or less). The house is paid off, or nearly so. There is more discretionary income than there has been in years. The job is going great, (there’s even a light at the end of that tunnel, too) and many boomers find themselves financially capable of realizing their dream to own a home on the Outer Banks. 

On top of that, the Outer Banks real estate market has experienced a major price correction. Prices are far lower right now than they’ve been in years. With many homes on the market, there’s more inventory to choose from than there has been in years. And interest rates are very, very favorable. 

It’s as though the moon, the sun and the stars are all in perfect alignment for you and your dream to converge. 

If you are in the position to make your dream a reality, and if owning a home on the Outer Banks feels right to you, then in the immortal words of songwriter John Prine, it’s time to "blow up your TV and throw away your paper." 

After all, only you know what’s right for you. And if you will care about what you think, if you will make your opinion of what’s right for you be the only opinion that matters, then you can make good real estate decisions. 

So good, in fact, that just like your vacation, your decision to buy on the Outer Banks will be everything you could have asked for. 

DECEMBER 19, 2007 

WAITING FOR THE BEST MOMENT TO GET ON THE BOAT, MANY BUYERS MAY FIND THAT THEIR SHIP HAS SAILED 

I had an interesting conversation with an investor yesterday who owns scores of properties on the Outer Banks. As you might imagine, the topic of our conversation was the Outer Banks real estate market.  

We shared our thoughts and it was a lively discussion. Here are the high points: 

The market is constantly running ahead of us all. At any given time, there are always properties that are under contract. It typically takes between 30 and 45 days to close on a property, although there are many instances where it is advantageous to the seller or the buyer (or both) to delay closing for an extended period, which can be several months. 

These under contract properties represent the newest market data when these transactions close and these new closed sales establish market price. But since no one is privy to the price a property has sold for until it records (except of course the parties involved in each transaction), we all must wait for the sale to close before we have access to this information. 

And by that time, more properties will have gone under contract…and so on, and so on… 

Since the market is running ahead of us all, no one will know precisely when the market has hit bottom and is turning back to the seller’s favor. No one… 

If you are waiting to buy until the market has hit the bottom, you won’t be buying at the bottom, because none of us will know until well after the fact when that has occurred. And by then, the market will be on the upswing, turning towards the seller’s favor once more, the best opportunities already a thing of the past. 

Many buyers are waiting to buy thinking that they will ‘know when the time is right’. For most people, this means that they will need to see the market improving and they will need to hear from the media that conditions have changed. Many people are waiting for the media to make some kind of proclamation that ‘Now is the time! Go forth and buy real estate!’ 

But consider for a moment who has the most recent (and most reliable) information about the Outer Banks real estate market – it is the top-producing real estate agents. They are the ones who know how to analyze the information in the mls in meaningful ways. Of course, all Outer Banks real estate agents have access to this information, but not all of them possess the necessary skills to know how to interpret it. 

The media does not have access to the relevant local market information that real estate agents do. They have to interview those closest to the market to get it. (Get it?)  

So, if you really want to know the state of the market on the Outer Banks, you won’t get that information by reading the paper or listening to the nightly news. By the time the media ‘gets it’ that the market has turned, guess what?  

The market will have turned. 

I’ll leave you with the most valuable thought the conversation produced. It was this: 

You don’t have to buy at the bottom to make money in real estate. You just have to get a good value. 

If you just heard that, then you know all that you need to know about whether or not now is the right time to buy. 

The boat is in the dock. Will you be getting on board?  

DECEMBER 14, 2007 

In the first 14 days of December, 68 properties are under contract…and 22 of these are lots.  

Lots in some areas of the Outer Banks represent an extremely attractive investment opportunity.  

Here are the fast facts you need to know: 

1. Some lots have corrected further in price than homes have. Rental homes generate income which helps to hold their value. Obviously, lots don’t generate income, so when the market experiences a price correction, lot values can suffer… 

2. It’s cheaper to hold a lot than a rental home: 

*Property taxes are less
*There’s nothing to insure
*There’s nothing to maintain
*Closing costs are less
*Easy to own during storm season – if a tree falls on a lot, no worries! 

3. Not every lot on the market is priced where it will sell. You must identify lots in areas poised to rebound, that represent the best opportunities presently available.  

4. If retiring to the Outer Banks is your plan, consider securing your lot before the market turns to the seller’s favor. Today, not only are prices much lower, but with the present level of inventory, there’s a wider selection to choose from… 

5. Options, options everywhere! Buy and hold for investment or retirement, or buy and build out. Construction costs are less and many builders are more willing to negotiate now than they were in years past. Construction loan terms are also very favorable, as interest rates are at 2 year lows... 

If you want to find out more about investing in lots, you can reach me toll-free direct on my cell at 877.207.1617.  

Successful real estate investing is no more difficult than getting a plan and working that plan. 

Together, we’ll create a plan that works for you and your family, one that will fit into your budget, and one that draws your dream closer.  

It could be that a lot is the investment vehicle that makes your Outer Banks dream a reality.  

DECEMBER 15, 2007 

When I arrive at the office each morning, the first thing I do (after grabbing my large soy mocha) is to check the mls to see what properties have gone under contract. Yesterday, buyers stepped forward and put contracts on 8 properties. Of these 8 properties, 5 were lots…  

Here’s another thought about lots as an investment vehicle for you to consider: 

When the market begins appreciating, what goes up? Lot value! It is the lot underneath the home that makes the property worth more. The house itself is a depreciating asset – it loses value over time. 

Pure investors are simply out to make some money in real estate. If you fall into this category, then you may want to consider buying a lot. It is s no-muss, no-fuss investment vehicle… 

But keep this in mind: 

There are as many different investment goals as there are investors, and the vehicle that’s right for you simply depends on what your individual wants and needs are. 

A lot isn’t the right investment vehicle for everybody… There’s no one type of property that’s right for everyone.  

If you’ve always wanted a beach cottage, and if the thought of going through the construction process makes your stomach churn, then owning a lot on the Outer Banks may not be the best option for you. 

No worries, as there is a wide and wonderful selection of cottages for you to choose from. In other columns, I’ll begin discussing the advantages of owning a beach cottage (there are many), and I’ll give you tips on what to consider when you’re looking for that special place at the beach to call your own. 

For now, you might want to think about getting those last few presents on your list!