Once you purchase your dream home, the contract used to exchange the property between you and the seller will most likely wind up in a cabinet drawer, long forgotten until you want to review it for the next sale or purchase in which you're involved. The multi-page file (usually about an inch or so thick) has a long-term effect, but not a daily influence on your life.
Homeowners association documents, however, rule our lives more than we may realize. The Community Associations Institute(CAI), serves nearly 16,000 associations nationwide (out of the 250,000 that are in existence) and is one of the premiere think-tanks on property ownership associations.

With the growth rate for home prices starting to slow, now may be the time to ponder what a bear market in real estate may bring. A recent study by two econosmists at Goldman Sachs provides some answers.
For now , Prices are still clibing over all. The average home price in the nation rose 7.71 percent in the 12 months ended in march.
In nominal terms, United States home prices are up 60 percent since 1995; in real terms, adjusted for inflation, they are up 37 percent. viewd historically, home prices are up twice as much now as they were in the bullish real estate markets of both the mid-1970's and the 80's.

Economists' predictions came in under projected year-end sales

Each year, Inman News reports on what the major trade group economists are forecasting for real estate the coming year. Now we are looking back at what they told us last year to see how their original predictions played out.
Here's a look at what the trade groups originally predicted was in store for 2005, compared with what each is now predicting for this year totals. We also include what the experts are now forecasting for 2006.

National Association of Realtors

With home sales holding at historically high levels, the National Association of Realtors expects "modest cooling" in the real estate market next year.

In 2001, existing home prices appreciated at a rate of 6.3%, the largest increase in over a decade.The majority of studies indicate that households spend 30-40% of their disposable income on housing-related expenses. These expenditures assist in supporting other sectors of the economy. Nearly 70% of all tax revenues raised by local governments in the US derive from property taxes. Homeowners contribute roughly 43% of property taxes, and commercial property taxes contribute the remaining 57%. The National Association of Home Builders estimates that the construction of 1,000 single-family homes generates 2,448 full-time jobs in construction and related industries, $79.4 million in wages and $42.5 million in combined local, state and federal revenues and fees. Source: The Importance of America's Housing Sector to the Economy. On Common Ground, Winter 2003.

In Real Estate Fever, More Signs of Sickness
Some Economists Warn of Housing Bubble
By Daniela DeaneWashington Post Staff WriterSunday, April 17, 2005; Page A01
Matt Marshman watched it happen in one Germantown neighborhood in February. Each house that went up for sale cost about $15,000 more than the last. And the houses were all very much alike.
"We could see the prices going up every day," said Marshman, who with his wife Tracy Hernandez managed to buy the third house that they wanted there. The four-bedroom Colonial was listed for $30,000 more than other sellers had asked for a similar house just three weeks earlier. The couple eventually won a bidding war by offering $26,000 more than the asking price.

Tracking Markets' Bloated Prices
By Kenneth R. HarneySaturday, October 22, 2005; F01
None of us likes to hear the bad news that we paid too much for our house. Or that our neighborhood is 20 percent overvalued and prone to downward adjustment.
But a group of economists in the business of assessing financial risk have come up with a new statistical tool to detect exactly that kind of real estate price bloat. It's called the Valuation Index, and it was released Tuesday by PMI Group of Walnut Creek, Calif., one of the largest insurers of home mortgages.
According to the index, real estate in the metropolitan Washington area is 18.2 percent overvalued.

The red-hot market has made owning a home out of reach, not only for low-income families but also for many white-collar professionals. "Many of the overheated real estate markets throughout the country have become unaffordable for the majority of the population," said Jack McCabe, a housing industry analyst in Deerfield Beach. "Many people are paying well over 50 percent of their income for shelter. It leaves no money for savings or sometimes even for recreation."
After So Young Kim took a job in Florida, her friends in Chicago gushed that she and her husband would be able to afford twice the house when they moved. Kim had received a doctorate and a job offer from a university that would double her salary to more than $47,000. But the prices of even small bungalows climbed far beyond what the young couple could afford even when they stretched their price to an uncomfortable $300,000. So after several disappointing drives around the area and countless Internet searches, they ended up back where they started, in an apartment.

The Errors & Omissions (E&O) insurance market has changed substantially over the past 15 years. Rates and other issues have escalated, including raised limits and over-extended reporting periods that have impacted the industry. Add to that, few companies are helping broker/owners and agents understand the complex nature of E&O trade.
One of the industry leaders on this front has been Ft. Lauderdale-based HMS National through its Risk Management Solutions division, whose leaders are laser-focused on partnering with their clients to provide comprehensive risk management solutions that include education, training, E&O and home warranties. “It’s important for broker/owners and agents to be aware of the almost daily changes in the E&O market,” says Doug Stein, director of marketing and development for HMS.“ Today the industry is characterized by fewer E&O insurers and more exclusions, like mold. Yet, we find many of our new broker/owners and agent clients have never fully understood their policies and haven’t taken all steps to improve their coverage while reducing cost.”

Real estate has enough surprises and challenges -- you don't need to create your own. Self-inflicted agent damage can be solved with patience, education, and experience. Even with top producers, the occasional “snafu,” while rare, still happens! What follows are some of the biggest mistakes my coaching clients and I have made during my last twenty-eight years of selling real estate. It is my goal that you learn from others, because experience is a hard task-master. And, keep in mind, they don't give out Purple Hearts for self-inflicted injuries!
1. Occupancy prior to closing. I know what you're thinking. The client had to get in, the property was vacant, and the seller didn't care! Why not be a client-pleasing agent and make it happen? You can even cure the liability issue with a pre-occupancy agreement and make certain that all insurance is in place, but I guarantee you that you will only do this once in your career! If you do it a second time, then you must enjoy pain. When those new buyers move in prior to closing, they are at the height of their anxiety. Buyers’ remorse is running rampant. Mrs. Buyer is still mad at Mr. Buyer for not negotiating harder. The lender is still calling for "just one more" piece of paper! They are so grateful that you arranged that early occupancy but, as they are moving in, they notice that the front concrete porch, once hidden with a mat, has a huge crack. They didn't notice the discoloration on the walls until the pictures were removed. How about that stain that was behind the seller's couch?

In this red-hot real estate market, with its instant sales and skyrocketing housing values, home improvements seem like a smart investment. Indeed, Americans spent a record $127 billion on remodeling projects last year alone. But is this conventional wisdom always right? Well, it depends, say experts -- on the project you pick, how much you wind up spending, and where you live.What To Consider First
Ask yourself, “Will this remodeling project enhance my life?” If it will, it’s probably worth considering for that reason alone. After all, you are doing something to improve your living conditions. But three key factors determine whether it’s likely to pay off financially too:

Give Your Old Bathroom a New Shine. Remodeling an old bathroom is always a good idea -- and it costs much less than updating a kitchen. Last year, this popular project typically included installing a new bathtub, toilet and vanity counter with a double sink, plus a recessed medicine cabinet, ceramic-tile floor and vinyl wallpaper. Average cost: $9,861. Average value added: $8,887.
Most Desired Extra: A Second Bathroom. No improvement is more essential to a family’s comfort than a second bathroom. A typical mid-priced addition last year featured a tub/ shower with ceramic tile surround, a low-profile toilet, a cultured-marble vanity top, a mirrored medicine cabinet, linen storage, plus general and spot lighting, vinyl wallpaper and a ceramic-tile floor. Nationwide, the average cost for these amenities was $21,087, and the average value added to the house was $18,226. In some markets, however, the project actually more than paid for itself. In Albany, N.Y., for example, this bathroom cost $21,497 last year but boosted resale value by an average $28,750.

The Department of Justice Antitrust Division filed suit in September against the National Association of REALTORS®, challenging a new policy that allows MLS members to choose an “opt out” provision that prohibits all other brokers from displaying that member’s listings. The Department's civil antitrust lawsuit was filed in U.S. District Court in Chicago.
According to NAR, “opt out” ensures that all members of Realtor multiple listing services will receive exactly the same MLS property listings for display on their Web sites as their competitors.
However, the Department said that NAR's policy prevents consumers from receiving the full benefits of competition and threatens to lock in outmoded business models and discourage discounting. "The purchase of a home is one of the most significant financial decisions a family can make, and NAR's policy stifles competition to the advantage of some of its members at the expense of home buyers and sellers across the country," said J. Bruce McDonald, deputy assistant attorney general in the Department's Antitrust Division. "Consumers benefit when real estate brokers are free to compete vigorously by offering innovative services."

Secondary mortgage market companies Fannie Mae and Freddie Mac have increased conforming loan limits on single-family properties from $359,650 to $417,000, effective January 1, 2006. Next year's 16 percent conforming loan limit increase is the largest in 20 years, and reflects the October-to-October changes in average house prices, as published by the Federal Housing Finance Board. Loan limits will also increase on other properties: * $533,850 for mortgages on two-family properties (up from $460,400);* $645,300 for mortgages on three-family properties (up from $556,500); and* $801,950 for mortgages on four-family properties (up from $691,600).Under the Fannie Mae and Freddie Mac charters, loan limits in states and territories designated high-cost areas - Alaska, Hawaii, Guam and the U.S. Virgin Islands - are 50 percent higher than the amounts above.In separate announcements, FHA and VA will also raise their limits in 2006. Their limits, which are based on a percentage of the Fannie and Freddie conforming loan limits, will now automatically increase for those loans insured on or after January 1, 2006. The new FHA limit will be $200,160 which is 48 percent of the new conforming limit (i.e. $417,000). The high cost limit will be increased to as high as $362,790, which is 87 percent of the new conforming loan limit. However, since under the FHA program there is no nationwide limit, the U.S. Department of Housing and Urban Development will have to compute the individual limits for 3223 counties nationwide. HUD is expected to publish a new mortgagee letter announcing the areas that will be affected before the end of December.The effective maximum VA no downpayment loan limit will be raised to $417,000 on Jan. 1, 2006

The actual closing of the sale is by far the most important step in the selling process. Without it, you haven't sold anything, have you? However, it should also be the most natural part of the process. Everything else you do leads to that point.
I teach lots of techniques for prospecting, meeting people, qualifying, presenting, demonstrating, and addressing concerns -- and they're all important, of course. But, unless you can close, you're like a football team that can't sustain a drive long enough to score.
The biggest complaint I hear from most salespeople is that they don't know when to start closing. Those people just don't understand the simple fact that a true Champion salesperson is closing all the time. He or she is constantly trying test closes and will go into the final closing sequence anytime they sniff the sweet smell of success (such as when they hear the client start talking as if they already own the product or when the client relaxes his or her body language or even when they begin asking more questions).

Although Albert Einstein is known for the most famous scientific formula of all times, here is another formula that every real estate sales agent needs to treasure: Knowledge, fueled by emotion, equals action. Action is the key ingredient that ensures the results you seek. Only action can cause reaction or results. Further, only positive action can cause positive reaction or positive results. So, let’s look at action from a number of different standpoints and see what we can learn and then put into practice.
Action. The whole world loves to watch those who make things happen, and it rewards them for causing their waves of productive enterprise and the results that come as a result. I stress this because today I see many people who are really sold on just uttering affirmations. And yet there is a famous saying that says: "Faith without action serves no useful purpose." How true that is!

Make Any Room Look Bigger (Part 1 of 2)
Your new listing has a very small living room, bathrooms, or kitchen. What do you do? Just because you’re given small spaces to work with in preparing a home for market doesn’t mean that you’re stuck with them. You can easily make any room look larger or more attractive, according to designers and home stagers who have developed strategies to show off the best features of every room in a house.
The key, say the experts, is to get rid of clutter, clean everything down to the switch plates, and create a neutral space that buyers can picture themselves living in. “Buyers only know what they see -- not what could be,” says Barb Schwarz, ABR®, president of Stagedhomes.com, a home-staging consultancy based in Concord, Calif., and founder and president of the International Association of Home Staging Professionals. “I tell people to put things away, bring the outside in -- like touches of greenery and nature -- and emphasize the best of what’s there. Rooms will look bigger, and the buyer can mentally move in.”

The KitchenAccording to Heidi Meyer, founder of Home Highlights in Madison, Wis., the kitchen is the heart of the home, so make the investment to update an old kitchen. “If the room is dated, update it with new cabinet hardware or paint it,” she advises. That will give it a more open, clean look.Marshall suggests clearing off the counter as much as possible. “Try not to have the coffee maker, mixer, and toaster all out at the same time or people will think there’s not enough room for everything,” he says.
Decorate simply, using just a couple of cookbooks, says Russell, or fill a pretty bowl with lemons or green apples and put it on the counter or a sideboard.Matzke advises cleaning wood cabinets with degreasers and then applying orange oil. “Let the oil soak in a couple of hours, then wipe it off,” Matzke says. “It makes the cabinets look brand new. Clean the inside of the stove and refrigerator, and shine the counter tops, sinks, and faucets.” When a kitchen is spic-and-span, buyers will focus on how great it looks rather than how small it is.

Home prices, particularly in high-cost areas, could decline 15 percent if President Bush’s tax reform panel’s expected recommendation to convert the mortgage interest deduction (MID) to a tax credit gets implemented, said Al Mansell, president of the National Association of Realtors®. Speaking at the opening session of the 2005 REALTORS® Conference & Expo in October, Mansell said that if the MID were changed, the typical homeowner could lose $20,000 to $30,000 in housing equity.“Housing is the engine that drives this economy, and to even mention reducing the tax benefits of homeownership could endanger property values. The tax deductibility of interest paid on mortgages is both a powerful incentive for homeownership and one of the simplest provisions in the tax code. It should not be targeted for change,” Mansell said. Eliminating the mortgage interest deduction would hurt middle-income families the most, he said. According to IRS tax return data from 2003, 52 percent of the families who claim the mortgage interest deduction have household incomes between $60,000 and $200,000.

Selling real estate, or anything else, requires a great deal of creativity. As with any other area of expertise, it requires attention and dedication in order to stay fresh. So, how do you practice the art of getting great ideas? Some people do it naturally. They've made selling their passion and are always on the lookout for ideas that might apply to a selling situation. If you haven't given much thought to keeping your creativity level high, here are six requirements for getting those rusty gears in action. There are six requirements for great ideas: want and need, exactness, preparation, belief, and execution.