Lee Morof's Real Estate Blog

The U.S. economy continues to improve.

The National Association of Homebuilders released its Improving Markets Index Tuesday. The report attempts to identify U.S. metropolitan areas in which the economy is improving, demonstrating “measurable and sustained growth”.

125 U.S. markets are qualified as “improving” this month, a 22-market jump from the month prior and and all-time high for the index which launched late last year.

Compared to November 2011, this month’s IMI has climbed more than four-fold, rising from last year’s reading of 30. This jump suggests that housing recovery is firmly taking root, helping to generate needed jobs and economic growth across much of the country.

So what qualifies a market as “improving”? The NAHB uses strict criteria.

First, the group gathers data from the three separate, independent sources :

1. Employment growth from the Bureau of Labor Statistics
2. Housing price appreciation from Freddie Mac
3. Single-family housing permits growth from the U.S. Census Bureau. 

Next, for each of the above data sets, the National Association of Homebuilders separates for local data in each U.S. major metropolitan area.

And, lastly, armed with data, the NAHB looks for areas in which growth has occurred for all three data points for six consecutive months; and for the most recent “bottom” is at least six months in the past.

In this way, the Improving Market Index doesn’t just measure housing market strength — it measures general economic strength. 

Of the 22 markets added to the Improving Market Index in November, the following cities were included : San Diego, California; Gainesville, Florida; Omaha, Nebraska; Louisville, Kentucky; and Charlotte, North Carolina.

Several markets dropped off the list, too, including Hanford, California; Orlando, Florida; Terre Haute, Indiana; and Greenville, North Carolina.

The complete list of 125 metropolitan areas on November’s IMI, plus breakouts of the metropolitan areas newly added and dropped is available online at http://www.nahb.org/imi.

Another month, another good showing for the U.S. economy.

Mortgage rates are performing surprisingly well after Friday’s release of the October 2012 Non-Farm Payrolls report. The Bureau of Labor Statistics’ monthly report beat Wall Street expectations, while also showing a giant revision to the previously-released job tallies of August and September.

171,000 net new jobs were created last month against calls for 125,000 and revisions for the two months prior totalled 84,000.

October also marked the 25th consecutive month of U.S. job growth — a period during which 3.8 million jobs have been reclaimed. This sum represents more than half of the 7.3 million jobs lost between 2008-2009.

Nationally, the Unemployment Rate rose by one-tenth of one percent last month to 7.9%. It may seem counter-intuitive to see unemployment rates rise even as job growth soars. However, it’s a sign of economic strength.

October’s rising Unemployment Rate is the result of more workers entering the U.S. workforce and actively looking for jobs, a manifestation of rising consumer confidence levels and optimism for the future.

Typically, mortgage rates in Michigan would worsen on a strong jobs report like this. This month, however, rates are improving. This is mostly the result of Hurricane Sandy, which is expected to create a drag on the U.S. economy with its $50 billion damage tag.

The storm has Wall Street looking past the strong jobs report, positioning itself for the next few months. Investors are moving into less risky assets until the uncertainty surrounding the storm’s effects subside. Mortgage-backed bonds are considered “safe” and are benefiting from this safe haven buying pattern.

For home owners and buyers in Birmingham and nationwide, the shift is yielding an opportunity to lock mortgage rates at artifically-low levels. 30-year fixed rate mortgages remain well below 3.50% for borrowers willing to pay discount points, and home affordability is approaching an all-time high.

Home values are expected to rise through 2013 so consider this week’s low rates a gift. If you’re in a position to go to contract and/or lock a mortgage rate, you may want to take that step today.

Have you ever walked into your kitchen and instantly felt hungry?

Rarely do people think about the colors that they choose to paint their kitchens. They are often too busy worrying about whether the kitchen will match the rest of the home, or whether the colors will be satisfactory to the rest of the household.

However, when painting and decorating your kitchen, you may want to think about the process in a way many people do not — how the colors you choose will affect the way in which you eat. As behavioral psychologists have documented, the presence of specific colors your the kitchen can change your eating habits and your cravings for food.

Here are some examples :

• The color red increases your appetite. This is why so many restaurants paint their walls red. Although associated with romance and passion, red is also a color which promotes hunger. Furthermore, it has been noted that the color red in your kitchen can influence high blood pressure.
• The color blue is calming, which can slow your eating speed, and prevent you from over-eating. When decorating your kitchen and dining room, therefore, using blue wallpaper or blue paint; and blue placemats, for example, can result in “slower” eating and fewer feelings of fullness.
• The color orange is a “stimulating” color; increasing oxygen supply to the brain and providing a mental boost. An orange-themed kitchen may stimulate your appetite, therefore, and make over-eating more likely.

Then, there is gray. Gray can be an ideal appetite-suppressing color for your kitchen. This is because, psychologically, gray is calming and relaxing, and it neutralizes anxiety. Gray can arrest binge eating and impulsive snacking. It’s also a color which home stagers recommend for its neutrality.

Whether you’re a home buyer in Birmingham , a home seller, or just getting ready to remodel, consider the influence of colors in your home. They do more than just “match the next room” — they affect your food and drink cravings as well.

Friday morning, the government’s Bureau of Labor Statistics will release its Non-Farm Payrolls report, more commonly called the “jobs report”.

Depending on how the jobs data reads, FHA and conforming mortgage rates may rise, or fall. This is because today’s mortgage market is closely tied to the U.S. economy, and the U.S. economy is closely tied to job growth.

Economists expect that employers have added 125,000 net new jobs to their payrolls in October 2012, up from September’s tally of 114,000 net new jobs. Jobs have been added to the economy over 24 consecutive months leading into Friday’s release, and approximately 4.7 million jobs have been created in the private sector since early-2010.

So, what does this mean for home buyers and refinancing households throughout Royal Oak ? It means that mortgage rates may get volatile beginning tomorrow morning.

Improving jobs numbers tend to push mortgage rates up, as it signals to investors that the U.S. economy is strengthening. If the actual jobs reports shows more than 125,000 net new jobs created, therefore, look for mortgage rates to rise.

Conversely, a weaker-than-expected report injects fear into the market, causing investors to purchase safer assets including U.S. Treasury bonds and mortgage-backed bonds. This moves mortgage rates lower.

Markets will also watch for the monthly Unemployment Rate. After falling to a 4-year low of 7.8 percent in September, economists anticipate that October’s unemployment rate will rise 0.1 percentage point to 7.9%.  

The good news for rate shoppers is that mortgage rates remain low. Freddie Mac’s weekly mortgage rate survey puts the 30-year fixed rate mortgage below 3.50% nationwide for borrowers willing to pay 0.7 discount points. Furthermore, a forecast from the Mortgage Bankers Association predicts that the 30-year fixed rate will remain below 4% for at least the next 8 months and low mortgage rates help to keep home payments low.

The Bureau of Labor Statistics releases the jobs report at 8:30 AM ET Friday.

Who knows your home and your neighborhood better than you do? No one! So help your Bloomfield Hills real estate agent market your property by providing him or her detailed information about your home and your neighborhood. Give your agent:

• A schedule of your home’s maintenance – Provide a list of your home’s maintenance schedule including when you did landscaping, pest control, window washing and furnace inspections. This helps potential buyers feel good about the upkeep and maintenance of the property.
• A history of renovations and upgrades – Buyers want to know what is original to the home and what you’ve added on. Put together a folder that contains the renovations you’ve made, why you chose to do them, any building permits you obtained and the contractors you used.
• A map of the area marked with schools, parks and points of interest – Think about the different lifestyles of the people who might purchase your home and try to appeal to multiple types.
• A list of great local establishments – When you’re new to a neighborhood, you never know where to go for good food or affordable dry cleaning. Make buyers feel immediately at home by putting together a list of your favorite local vendors and restaurants.
• A description of the neighborhood — and make it positive – Highlight how often HOA meetings are held, what cul-de-sac the children play in and which neighbors usually host the annual block party. Reading positive information on the neighborhood will help a buyer build an affinity for your home.

By providing these documents, you’ll help your Bloomfield Hills real estate agent create an identity for your home that will hopefully have an emotional effect on buyers and quickly make them feel at home.

If you’re looking for one of the best Bloomfield Hills real estate agents to market and sell your home, please call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com. I’ll show you my proven 30-Day Marketing Plan that gets homes sold fast.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Buying a new home isn’t a sprint; it’s a marathon. When you find the Southeast Michigan real estate of your dreams and place an offer that is accepted, don’t assume the marathon is over — there are many more miles you must travel before closing.

Here are four steps to take after the contract is signed:

1. Be prepared for your earnest money or escrow deposit to be cashed. This money can be anywhere from $1,000 to three percent of the price.
2. Go over disclosures with a fine-tooth comb. Your agent will help you identify any red flags. Then, you want to familiarize yourself with the home’s history, zoning district and past building permits. Ask questions about anything you don’t understand.
3. Negotiate with your bank. It’s time to lock in an interest rate with your lender. You might have gotten pre-approved beforehand, but now you actually need the loan.
4. Schedule a property inspection. Attend the inspection, and come prepared with a list of questions for your home inspector. The point of this appointment is not just to highlight major issues, but also to familiarize yourself with the short and long-term maintenance of your new Southeast Michigan real estate.

Don’t get derailed by unexpected costs and time-consuming tasks that come after you sign a contract. You’ll want to be mentally and financially prepared so that you can close smoothly and move into your new Southeast Michigan real estate quickly.

If you’d like more information about what happens before closing, please call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Let the bidding wars begin! If you are considering selling your home, you may be dreaming of the magic sale. In this scenario, before the house is even on the market, someone knocks on the door and offers twice the asking price in cash, and maybe throws in a leer jet ride or a pet pony.

In real life, marketing and hard work will serve you better. Here are a few tips on getting the best price for your real estate in Southeast Michigan:

• Consider your target market: If you have an investment property, your most likely buyer is very different from those looking to buy a single-family home. Investors may be looking at rental rates in your neighborhood; single-family homebuyers may be more concerned with school systems. Know who will be looking at your home, and give them the information that is most important to them.
• Be online: You must have your real estate in Southeast Michigan listed online if you expect anyone to find it these days. In particular, look for websites that allow you to upload pictures, comment on features, and are updated frequently (daily, preferably).
• Negotiate online: It’s a fast-paced world, and being able to zip offers and counter-offers back and forth can speed negotiations.
• Spread the word socially: Word of mouth is now electronic, and that buzz on your real estate in Southeast Michigan can be far reaching. Some social media dashboards allow you to manage Facebook, Twitter and other connections from one spot, so you don’t have to spend all your time updating different sites.

You may not be the kind of person who can sell sand in the desert, but putting together a strategic marketing plan that takes advantage of the electronic world can help you generate the kind of offers that dreams are made of.  Just don’t ask for the pony.

If you are considering selling your home, let me show you my proven 30-Day Marketing Plan that gets homes sold fast. Give me a call today at 248-514-2640 or email me at info@NorthWoodwardHomes.com.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Being the new kid on the block can be tough. Not only does your family have to adjust to their new Royal Oak Michigan home, but they also have to get to know an entirely new neighborhood. The Halloween festivities are the perfect time to do it!

Don’t let your family become as estranged as the Adams Family in their new surroundings. Be outgoing to help relieve any creepy-crawly feelings your kids have about the new neighborhood. Review the tips below and take advantage of the holiday season to make new friends, get involved in the community and experience hot spots near your new Royal Oak Michigan home.

• Don’t be shy; say hi! Find opportunities to meet your neighbors. Linger outside by raking fall leaves or putting up Halloween decorations. You’ll be amazed at how many doors will open.
• Host a haunted open house. Neighbors always want to see how you’ve redone the place, so be proactive and invite everyone over for a haunted open house party. Serve special spooky treats such as caramel apples and hot pumpkin cider.
• Get involved in the community. Whether you join the community center, attend a local church or volunteer at an area shelter, find something your family is interested in and can do together. Most of these establishments also host holiday parties or trunk-or-treat events.
• Plan a new experience each week. Try a new restaurant, go to an annual festival or cheer on a local sports team. Having something for you and the kids to look forward to will help build excitement and an affinity for your new neighborhood.

By implementing a few of these tips, your children will know their way around the neighborhood in no time. And you’ll know all the little witches, mummies and ghosts that show up at your Royal Oak Michigan home for candy come October 31.

If you’re in the market for a new home, I can help. Please call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Good Bloomfield Hills real estate agents can be valuable partners when buying or selling a home. Their marketing efforts, hard work, knowledge and negotiation skills are huge assets when house hunting or selling your home.

Below are four tips to help you hire a Bloomfield Hills real estate agent who will provide the best service for you:

1. Make sure your expectations are clearly spelled out. Buying or selling a home involves a great deal of money and that has the potential to cause a lot of stress — especially if you feel your agent isn’t living up to your expectations. To avoid this problem, share your expectations with the agents during the interview process. Be as specific as possible. Do you expect them to email you once a week with updates? Perhaps you want them to call you with feedback each time they show your home.
2. If buying a home, ask how your professional will find homes that meet your standards. A good Bloomfield Hills real estate agent will take into consideration your budget  and your needs. Then he or she will narrow down the choices to save you time and effort.
3. If selling a home, agree on a marketing plan before you sign. Selling a home in today’s market requires a well-thought-out marketing strategy. An easy way to ensure prospective agents are up to the task is to ask to see their marketing plans in writing. A professional agent will have a clear strategy that includes both online and offline marketing.

If you’re ready to buy or sell a home and are looking for a knowledgeable Bloomfield Hills real estate agent in Oakland County, please call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof 
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Fall may not always be the most ideal time to put your Bloomfield Hills real estate on the market, but that doesn’t mean that your sale has to suffer. Instead, use the season to your advantage when marketing your house for sale by keeping it looking its best. Here are a few tips for selling your property this fall.

1. Spruce up your curb appeal with fall colors and themes. You want your house to appear festive and inviting without adding excess clutter or anything overly personal. For instance, this may not be the year to break out the over-the-top Halloween decorations — maybe limit it to just one or two porch pumpkins.
2. Maintain the exterior. As grass starts to require less frequent mowing, don’t forget about other outdoor maintenance. Power wash siding, repaint the mailbox and keep up with the yard work, such as raking all of those fall leaves.
3. Keep in mind fall buyers may be looking for bargains. Many buyers assume that fall and winter sellers are distressed or in a hurry to unload their Bloomfield Hills real estate. Don’t be offended if you get a few lowball offers. Make a counter offer that you think is reasonable and see how the deal plays out.
4. Replace online photos to reflect the season. Buyers are able to calculate how long your home has been on the market, if all of the photos show your property in early spring when it’s now autumn. Have your agent update the listing to keep it looking current.
5. Update your house now. Many contractors offer seasonal discounts as the traditional construction season winds down. It may be the perfect time to redo the siding, update the air conditioner or replace the roof.
6. Bake something seasonal. Nothing helps a buyer cozy up to a house like the smell of fresh baked cinnamon cookies or an apple pie. Don’t just take advantage of the look of the season, play up its smells too!

If you would like more seasonal tips to help sell your Bloomfield Hills real estate, please call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof  
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com