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A Tale of Two Markets It was the best of times; it was the worst of times…so starts the classic novel. It sounds like Dickens could have been writing about the real estate market. The national press would have you believe it is the worst of times. And in some markets, things do seem bleak: • West Palm Beach, Florida has seen the number of sales decrease by 45% over the past two years. Average sales price has decreased 4.5 % over the past year. 1&2 • Las Vegas, Nevada has seen a 55% decrease in the number of sales in the past two years and a 5% decrease in average sales price in the past year. 1&2 • Detroit, Michigan has seen the number of sales drop by /3 over the past two years. Thirty percent of listings are vacant, and 40% of the houses that sell are owned by the bank that foreclosed. 1&2 How does this compare to our market? In the area covered by Trend MLS3, there has been a 8% decrease in the number of sales over the past two years. Yet various indices report that average sales price for the Philadelphia Market Service Area (MSA) is either stable or experiencing moderate increases. 2&3 The increase in inventory of houses for sale is leveling off and there are fewer houses coming on the market as compared to last year. Remember, inventory and average sales price data vary in each sub-market, so it is important to talk with your Prudential Fox & Roach sales associate about the specifics of your exact area. Why is there such a difference between our market and the others I’ve mentioned? Each has its own set of circumstances that we do not have here: Appreciation Rates In West Palm Beach, appreciation over the past five years was 00.27%!2 That pace could not possibly be sustained. As a result, affordability has become a major issue and prices are dropping to reignite demand. Scarcity of Land and Speculator Purchases Las Vegas is surrounded by vacant land. Many developers and builders, sensing the real estate boom, built a seemingly unending supply of new houses without really thinking of demand. As a result, there is now a tremendous supply of new homes on the market forcing builders to lower prices to move inventory. By comparison, our market area is more fully developed and has a low supply of vacant land. A long and cumbersome development approval process further reduces the supply of new homes. Las Vegas has also had a significant share of homes purchased by short-term speculators during the boom. This has added to the oversupply of houses as they try to recoup their investment. Diversity of Local Economy and Industry When one thinks of Detroit, the capital of the American auto industry comes to mind. The Detroit real estate market is so dependent on this industry that it is suffering as a result of American auto makers’ significant decline. In contrast, our area has a diverse economic base, with multiple industries and a growing economy. Income is rising and jobs are being added. Where is the market going? In 2006, I predicted that, barring any unforeseen events, our local market would begin to improve by the end of 2007. There was an unforeseen event: the credit market changes brought on by the breakdown of the sub-prime and Alt-A segments of the mortgage industry. As a result, overall credit standards have risen and the availability of some products has become limited. This has created a temporary decrease in the pool of buyers able to obtain financing. Most significantly, the national press has created a lack of buyer confidence. By using statistics from areas like West Palm Beach, Las Vegas, and Detroit to describe the nation’s real estate market, they have convinced many buyers that the sky is falling. It will take some time for them to regain confidence in the local market. Fortunately, some of our local and national press has begun to look at the facts and report a more objective view of our specific market. In September the Philadelphia Inquirer’s front page boasted that "The region’s housing market is healthy despite national troubles."4 In October, the New YorkTimes Sunday Business section called for Gloomsayers to look up and said, "Newspapers (which often sell on fear, not on fact) talk frequently of a mortgage freeze. owever, for all but the least qualified buyers, mortgage money is plentiful."5 It is too soon after the August credit market changes to make accurate predictions about our future real estate market. After several years of an unsustainable overheated market, we are in the middle of a market correction. Since our market did not suffer the excesses of other areas of the country like those I have mentioned, our correction will be mild with a smaller drop in the number of sales and stable prices. The most likely scenario is for the Philadelphia MSA to fluctuate around its current levels at or near the bottom of the market until winter of 2008 or spring of 2009. There are many positive signs for our market: • The mortgage market is improving. • The Federal Reserve is lowering interest rates. • The increase in housing inventory is stabilizing. • Homes are becoming more affordable as prices rise at a reduced rate, interest rates decline, and incomes grow. • The economy, jobs and income are growing. • Demographics (baby boomers, echo boomers, and immigration trends) point to a healthy long-term demand for housing. These important elements and an improving consumer attitude towards real estate will create a healthy, normalized real estate market. The Tale of Our Market While our market may not be experiencing "the best of times," they are far from the worst! In any time of change it is easy to become pessimistic yet it is important to put events into perspective. In hindsight, times of hesitation often turn out to have been times of opportunity. Buying or selling a home is a major financial and lifestyle decision that is best made because of immediate family needs and long-term investment considerations. The reality is that home prices in our market have increased steadily over the past 25 years.2 It is extremely unlikely that this trend will change over the next 25 years.  It is impossible to predict the bottom of any market. As our real estate market begins its inevitable upswing, pent-up demand for housing will cause a decrease in the selection of homes for sale and flexibility of terms, and higher interest rates. Our current environment presents an unusually good opportunity for buyers with good credit and an adequate down payment to take advantage of a larger selection of homes for sale with less pressure to make quick decisions. Sellers who are realistic about value and whose homes are in good condition will obtain a good price in a reasonable amount of time. For the majority of us, homeownership is so much more than a financial investment. That our homes provide us with financial security is a bonus. It is our life circumstances rather than financial analysts that determine when it is right to buy or sell a home. Home is where we put down roots, raise our families, and become members of a greater community. Our homes provide the setting where we celebrate our best of times. It gives us shelter through the worst of times. This is why homeownership is such a great part of the American Dream. Who can ask for more than that? Sincerely, Lawrence F. Flick, IV Chairman and Chief Executive Officer Prudential Fox & Roach, Realtors® Sources1. The Vision Group October 2007 Meeting, Detroit, Michigan 2. Office of ousing Enterprise Oversight (OFHEO), August 30, 2007 3. Trend Multiple Listing Service covers Northern Delaware, Central and Southern New Jersey and Southeastern Pennsylvania 4. Philadelphia Inquirer: "What Is Your ome Worth?" by Alan J. Heavens September 23, 2007 5. New York Times: "The Gloomsayers Should Look Up" by Ben Stein. October 2 , 2007 6. The National Association of Realtors® 7. Empirically estimated by Kevin C. Gillen, PhD, The Wharton School of the University of Pennsylvania from OFHEO and hallwatch.com data Parallel Lines — The Return to a "Normal" Mortgage Market Gerry Griesse, President, The Trident Group There are several parallels found between the return to a normal real estate market and the return to a normal mortgage market. Parallel #1 — Consumers are returning to a name they can trust Throughout the real estate boom of 2004 and 2005, new mortgage companies emerged. Many were Wall Street firms that did not understand the inherent risks of this type of lending. They focused on loans that required no documentation of income and assets (Alt-A loans), and offered mortgage brokers high risk adjustable rate mortgage (ARM) programs including 2/28 and option payment ARMs. As these loans began resetting in 2006, the mortgage delinquency rate increased causing concern for investors of securities backed by mortgage instruments. Uncertainty about valuation of these securities brought on the credit crunch of August 2007. This caused a number of national mortgage lenders to cease operations, leaving many buyers at the settlement table with no funds to close. As a result, the choice of a reputable mortgage company has once again become critical to consumers. Parallel #2 — The return to a "normal" market Now that the mortgage market has had time to settle down and investors are becoming more comfortable with valuation, the mortgage market has returned to a normal phase:• Financing options are plentiful for buyers with good credit and some money down. • The "smoke and mirrors" loans of no income or asset verification have disappeared. • For first-time homebuyers and buyers with less-than-perfect credit, FHA loans are once again the program of choice. FHA had lost significant market share to the sub-prime and Alt-A mortgage programs but its market share is growing and expected to continue substantially over the next two years.6 • There has been a return to traditional underwriting standards which includes full documentation and longer lead times for loan approvals and closings. Parallel #3—The national picture versus our market The national press takes the statistics from areas of the country most affected by foreclosures and attributes them to the nation. The same reasons causing the decline of real estate markets Larry described are contributing to the increased foreclosure ratios in those areas: • Affordability issues in the coastal areas of California and Florida caused many buyers to seek out ARMs with the lowest initial payment possible in order to purchase a home. Now that these rates have adjusted upwards, they cannot meet their payment obligations. • Investors and speculators who bought properties with no money down and have no vested interest in holding them once the payments adjusted upwards have contributed to foreclosure rates in areas like Las Vegas, Nevada. • Areas like Detroit, Michigan that rely on one industry have high unemployment when that industry begins to fail. Sadly, families who cannot sell their homes for a price to pay off their mortgage are in the position of not being able to meet their monthly mortgage payment. The Prudential Fox & Roach and The Trident Group market area does not have these issues, and foreclosure rates have remained stable. Parallel #4— It’s a great time to get a mortgage Mortgage rates are at historic lows, close to where they were in 1972.6 In fact, long term rates are now below what they were this time last year. After the initial credit crunch, the rate differential for mortgages above $4 7,000 did have a significant rise but it has since been reduced by almost 50% and is still trending downwards.6 As our local economy and incomes continue to grow, and consumers overcome the psychological barriers created by the press, demand for housing will grow resulting in higher interest rates, less selection and less favorable negotiating terms for buyers. Those who wait for the bottom of any market usually find they missed it on the way up. Housing is no exception. If your life circumstances dictate a move, find a name you can trust and get pre-approved for a mortgage now. Don’t let this opportunity pass you by. A Message from Lawrence F. Flick, IV, Chairman and Chief Executive Officer Prudential Fox & Roach, Realtors® 1VEMBER 28, 2007
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• 4,312 sq. ft., 2 bath, 4 bdrm 2 story "Colonial" -  MLS® $1,200,000 Penn Valley, Lower Merion - Bring your own builders. House is in need of total renovation. Beautiful almost 2 acre lot pending subdivision approval. There is an inground pool on the property. Preliminary drawings available upon request. Call agent for further details. Convenient location, minutes from center city. Property being sold in "As-IS' condition. Property information
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• 1 bath, 3 bdrm 2 story - MLS® $125,000 - Priced to Sell Delmar Village, Folcroft - Great opportunity for home ownership, large Living Room and Dining Room, Kitchen with newer range, 3 Bedrooms, one Bath, finished basement, Laundry, 1 car attached garage. Front yard and rear yard. Property information
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Paddock Farms, Haverford Township
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Announcing a price reduction
on 345 David Drive, a 2 bath, 4 bdrm ranch "Stone". Now
MLS®
$449,000
- Fully Rehabbed.
Property information
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Reliable Financing Choices are Available for Most Buyers. There’s been a lot of news about mortgage financing and the credit markets, prompting uncertainty and even fear in many consumers. While the problems have caused significant changes, it is important to note that they do not affect all types of lending in the same way. In the past few weeks, we have received many questions from clients and sales associates. In response to this, we are providing information to help clarify some of the issues and explain the changes that have occurred in the different types of financing. How did we get here? In order to understand how we got to this point, we must be able to distinguish between the different types of residential mortgages — Prime, Sub-Prime and Alt-A: • Prime lending describes fully documented and verified loans with an acceptable loan-to-value ratio given to borrowers with good credit. Conventional loans are under $417,000 and can be sold to Fannie Mae and Freddie Mac. Since Fannie Mae and Freddie Mac are perceived to have the backing of the United States government, investors have a higher level of confidence in them. Loans $417,000 and above are considered to be jumbo loans. Though they don’t have this perceived government backing, they meet the established standards for income and asset documentation. • Sub-Prime loans are generally given to borrowers with credit scores below 620. Income and assets may or may not have been verified. In the past, investors knew there was a greater risk of default but were able to make informed decisions in order to generate a higher rate of return to mitigate the risk. • Alt–A loans, which are often mistakenly called Sub-Prime loans, are given to borrowers with credit scores of 620 and above who are unable to document income, assets or both. Alt-A loans were most prevalent in markets with a high level of affordability issues or speculative/investor purchases. These markets include the coastal areas of California and Florida, and Las Vegas, Nevada. During the past few years, a popular form of Alt-A mortgage has been a 2/28 adjustable rate mortgage (ARM). Borrowers who were able to qualify at the low teaser rate were often not able to meet the monthly payment after the initial fixed rate period expired and the rate adjusted upward. Historically, these borrowers would have refinanced or sold the property when the rate reset, but tighter lending standards and flat property values have made this difficult. Since many of these loans were issued in 2005 and 2006, delinquencies in these loans are likely to grow over the next two years. In 2004, new sources of mortgage funding were created focusing on the Alt-A segments of the market. Many were Wall Street firms that did not understand the risks inherent in this type of lending. Unfortunately, some mortgage brokers originating Alt-A loans participated in fraud and predatory lending practices such as submitting applications for low-doc loans with inflated asset and income figures. In addition, many borrowers were directed to high risk adjustable rate mortgages including the 2/28 or an option payment ARM when their financial situation did not support it. As a result, there has been a rise in mortgage delinquencies in the Alt-A category. Most Alt-A mortgages were packaged into pools and sold to investors including hedge funds and banks. The increased delinquency rate has made it difficult to value these pools and this has caused concern among investors. In some instances, investors have demanded that they be made whole. This has caused a backlash among mortgage lenders having to meet these investors’ demands. As a result, some lenders are no longer able to provide funding for their current mortgage commitments. In some cases, they have closed their doors. What has changed? Overall, credit standards have been raised and product availability is more limited. In the specific mortgage categories, changes are as follows: • Prime. There is no real change in the availability of or qualifying standards for prime conforming loans. The premium on jumbo loans has risen, but these loans are available at reasonable rates. • Second Mortgages. Those seeking second mortgages will find more restrictive credit standards. As an alternative, borrowers should consider a larger first mortgage with private mortgage insurance (PMI) which is tax deductible for most borrowers. • Sub-Prime. True Sub-Prime lending has had limited adjustments to programs and guidelines. It exists as always and is now priced to properly compensate investors for the inherent risks of these loans. • Alt-A. Borrowers interested in Alt-A mortgages will find more restrictive requirements including larger down payments and higher credit scores. Many of the higher risk programs in this category (such as little money down and true no-doc loans) have been eliminated. What is the impact on the mortgage and real estate businesses? In the short term, borrowers with no down payment or credit scores of 620 or below will have difficulty obtaining financing. All borrowers can expect a return to traditional, full documentation and longer lead times for loan approvals and closings. The Federal Reserve and other central banks have recognized that market volatility has the potential to be harmful to the economy and they have taken steps to mitigate the risks. These steps will, over time, lead to a normalization of the mortgage markets. Conclusion The mortgage and financing market has gone from excessively loose to overly restrictive. As markets steady and investors in mortgage loans gain a better understanding of valuation and risk, financing programs and qualification standards will drift back to a middle ground creating more financing options for a greater pool of buyers and borrowers. Unlike Las Vegas and the coastal areas of California and Florida and similar overheated markets, sales prices are expected to continue to grow in our market. The August 2007 National Association of Realtors® (NAR) regional forecast shows a 2.7% increase in home prices for 2007 and a 2.6% increase in 2008. Reliable financing choices are available for most buyers. Combined with the fact that there is a great selection of homes on the market and interest rates are still at historic lows, indications are that it continues to be a great time to buy a home. Sincerely, Lawrence F. Flick, IV Chairman and Chief Executive Officer Prudential Fox & Roach, Realtors® Gerard F. Griesser President The Trident Group A Fight to Quality: Use Care in Choosing a Lender Earlier this month, the nation’s 10th largest mortgage lender, American Home Mortgage Investment Corporation, filed for bankruptcy. American Home failed to finance $800 million in loans, and thousands of home buyers were left stranded at settlement tables. Three of these home buyers were Prudential Fox & Roach clients. When their sales associates and their Trident Land Transfer Company Settlement Officer determined that the funds would not be arriving for settlement, they quickly arranged for Trident Mortgage Company to step in. In each case, Trident was able to provide financing and the closing took place. Why is Trident Mortgage different from other mortgage companies? While most lenders have limited relationships, Trident Mortgage Company, a mortgage banker, has relationships with over 30 investors, ensuring multiple funding sources. The industry recognizes our strength, and we are able to pre-sell our products to investors prior to closing. We strongly recommend that all buyers speak with a Trident Mortgage Consultant even if they have approval from another lender. Trident’s consultants are attuned to the pulse of the entire mortgage industry and if a situation like American Home Mortgage were to occur with another company, he or she would sound the alert so there would be no surprises at settlement. Sellers should also require their buyers to talk to a Trident Mortgage Consultant before signing a contract in order to be comfortable with the stability of the company that issued the pre-approval. An Independently Owned and Operated Member of the Prudential Real Estate Affiliates, Inc A Message from Lawrence F. Flick, IV, Chairman and Chief Executive Officer Prudential Fox & Roach, Realtors® and Gerard F. Griesser, President, The Trident Group
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They say any publicity is good publicity, but that hasn’t been true with some of the things being said about the real estate market. Do any of the following sound familiar? Real estate market freezes. How to survive the real estate market bust. Stocks break records while housing is in a freefall. Sub-prime tsunami hits home. It’s a wonder any houses sold at all! Yet 2006 was the third best year for residential housing sales on record. Perhaps the headlines should have read: Home appreciation remains steady. Philadelphia area prices rise above national average. Delaware Valley home prices continue to rise throughout 2006. Home sales remain strong despite decrease after record-breaking years. Tighter lending criteria will lead to a healthier housing market. So where do we find the common sense in the midst of all the sensationalism? Let’s start by looking at the facts. Housing Prices: Despite the negativity of the press, housing prices continue to rise in the vast majority of communities throughout the United States. In May, the Office of Federal Housing Enterprise Oversight (OFHEO)1 reported national average appreciation of 5.9% for 2006. Prices in our area continue to rise. In the Philadelphia Metropolitan Service Area (MSA), prices rose 6.74% in 2006.1 Our local multiple listing service TREND2 concurs, reporting a 2.1% price increase for January through April of 2007 over the same period of 2006. Though this is not a repeat of the double-digit appreciation rate of the past few years, it does reflect the continuation of a sustainable, healthy housing market. Economists at the National Association of Realtors®3 predict the continuation of this positive trend. Frequently Asked Questions If prices are still going up, then why do so many houses need price reductions before they sell? A decrease in a property’s list price does not indicate a decrease in value. Whenever the real estate market shifts from being a true sellers’ market to a more balanced or buyers’ market, it takes time for sellers to accept this reality. Many continue to list their properties as if the double-digit appreciation rates of several years ago were still occurring. As a result, these properties are over-priced. As sellers begin to become more educated to the reality of the market, they will adjust their list prices downward and they will sell. But the actual selling prices may not be below any previous comparable sale prices. The dollar amount of the gap between original list price and eventual sales price is not depreciation, but wishful thinking. Is it possible to under-price a house? Many sellers recognize the need to price their house realistically, yet are afraid they will not achieve maximum value if the list price is too low. Houses that are priced competitively, are in excellent condition, and staged for showings tend to attract the attention of multiple buyers. Our experience has shown that when this occurs, interested buyers will compete to buy the house, and their offer prices will reflect its true market value. Is it a good time to sell a house? Even though the number of unit sales is down, houses continue to sell at a brisk pace. In 2006, an average of 238 homes sold each day in the Prudential Fox & Roach service area2. Listing inventory and time on market have increased, and buyers do have more choices and less pressure to make an immediate decision. Yet serious buyers will gravitate to quality, and houses priced realistically and in excellent condition will sell at a good price in a reasonable amount of time. For move-up buyers wishing to sell their present home and buy a larger one, this market offers the double benefit. By realizing the previous appreciation gained on the current property and enefiting from the reduced appreciation rates on the more expensive property, they can take advantage of both sides of this market. Is it a good time to buy a house? The best time to buy a home is when individual or family needs and circumstances indicate a change. Right now, there is a greater selection of homes from which to choose, less pressure to make a decision, the opportunity to obtain better terms and historically low interest rates. Buyers who wait until the market improves will lose many of these benefits and will likely pay a higher price and higher interest rate. What about affordability? Concerns about affordability are legitimate, but will decrease as time goes on. NAR’s affordability index is currently 114.9, which means that a family earning a median income has 14.9% more income than needed to qualify for a loan on a median-priced home. In the past five years, housing prices have gone up an average of 14% a year in the Philadelphia MSA. According to NAR, recent wage growth of 4% has been the highest in nearly a decade. As appreciation slows to a more reasonable level and incomes continue to rise, more people will be able to afford their desired housing options. Housing Sales: It is true that fewer sales took place in 2006 than in the previous year. NAR reports that, nationally, the number of existing home sales decreased by 8.5%. Locally, TREND reports a decrease of 8.9% in our market area. But taken in context, these decreases were modest. Low inventory, higher list prices and higher sales prices aligned to create an unprecedented and unsustainable volume of housing sales in 2004 and 2005. If we were not comparing the 2006 numbers to those record-breaking years, sales would have been considered quite robust. We are currently in the middle of a long-term cyclical market correction. The decrease in the number of homes sold bottomed out in the last quarter of 2006 and so far in 2007, it has diminished from -8.9% to -6%. A market upturn is predicted in the last quarter of 2007 with unit sales expected to grow by +3.6% in 2008. When this happens, it is likely to result in less inventory, higher prices and higher interest rates. While one can never absolutely identify the bottom of any market, I believe that we are at the bottom of this cycle and that now is a good time to buy a home. The Delaware Valley/Greater Philadelphia Metropolitan area encompasses many local submarkets. As David Lereah, former Chief Economist for the National Association of Realtors® says, "Whatever the national trends are with regard to real estate – whether they are booming or busting – what really matters are market conditions and influences in your neighborhood, town or city."4 Please consult with your Prudential Fox & Roach sales associate for trends in your specific locale. For the majority of consumers, owning a home is the greatest financial investment they will ever make. Over the years, increased equity and appreciation result in maximum returns. Yet it is so much more than that. It is security and shelter, a place to raise families. Whether short or long term, it is a place to put down roots and be a part of a community. Our houses give us access to a lifestyle that expresses who we are and where we want to be. Owning a house is the ultimate symbol of the best that our country has to offer. The Sub-prime Tsunami: Riptide or Ripple? Just what is the sub-prime tsunami and is it affecting our real estate market? First, we need to separate the term sub-prime from Alternate A (Alt-A) loans. The industry refers to both of these types of loans as sub-prime, but there is really a difference. Sub-prime loans have always been available to borrowers whose credit is less than optimal. Lenders of sub-prime loans know they are taking a greater risk in order to achieve greater returns. Borrowers agree to pay higher interest rates in order to obtain financing. With sub-prime loans, borrow information is verified. Investors are able to make informed decisions and loan defaults and foreclosures are kept to a minimum. The press has grouped Alt-A loans into sub-prime category, but they are really not the same. Alt-A mortgages are really conventional loans with added features such as no-income verification or a lower initial interest rate that can dramatically increase during the life of the loan. The intense level of activity in the real estate market in 2004 and 2005 led Wall Street investors and others with no understanding of the consequences of mortgage defaults and foreclosures to see an opportunity to cash in. They created companies that lent money indiscriminately, lowering credit standards, raising qualifying ratios, and accepting no verification of income and assets. As a result, the number of loan defaults and foreclosures increased. Many of these newly formed companies have since folded. Areas like coastal California and Florida, and Las Vegas, Nevada will feel the biggest impact of the Alt-A debacle, but it will only have a marginal effect on our local real estate market. In the Philadelphia-Camden-Wilmington metro area, the percentage of sub-prime loans rose from 9.6% to 19% in 20053. This is well below the national average of 14% to 28%. As lenders tighten their loan qualification standards, NAR predicts that 10% of buyers who would like to take advantage of sub-prime financing will need to delay their home purchase until they save money, increase their income and/or improve their credit rating. Sources: 1. The Office of Federal Housing Enterprise Oversight, News Release March 1, 2007. OFHEO’s mission is to promote housing and a strong national housing finance system by ensuring the safety and soundness of Fannie Mae and Freddie Mac. 2. TREND Economic and Market Watch Report, First Quarter 2007. TREND is the Multiple Listing Service (MLS) for more than 32,000 Realtors across the Philadelphia metropolitan area. TREND’s 13-county primary service area includes Kent and New Castle counties in Delaware; Burlington, Camden, Gloucester, Mercer and Salem counties in New Jersey; and Berks, Bucks, Chester, Delaware, Montgomery and Philadelphia counties in Pennsylvania. 3. National Association of REALTORS® Economic Monitor, April 2007. 4. Lehreah, David. All Real Estate is Local. Doubleday, New York, New York 2007. An Independently Owned and Operated Member of the Prudential Real Estate Affiliates, Inc A Message from Lawrence F.Flick, IV Chairman and Chief Executive Officer Prudential Fox & Roach, Realtors® and The Trident Group Brought to you by, Debbie Kiotis & Lynn Ray of The Kiotis Ray Team Prudential Fox & Roach Realtors® Debbie Direct: 610-889-5571 / Lynn Direct: 610-889-3656
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Recently Staged and Priced to Sell
• 2 bath, 4 bdrm 2 story "Colonial" - MLS® $345,000 - Appearances are Deceiving Beechwood Park, Haverford Township - Well maintained 4/5 Bedroom, 2 full Baths, Colonial on quiet street in Beechwood section of Havertown. Walk into the parlor with wood burning stove; good sized Dining Room; updated Kitchen with newer appliances; Family Room with sliders to concrete patio and spiral staircase to Loft on 2nd floor. Private office with floor to ceiling bookcases and Bedroom with full Bath, currently being used as Media Room, a perfect opportunity for in-law quarters or au-paire suite. 4 Bedrooms on the 2nd floor, updated Hall Bath, pull down attic stairs and exercise room/loft. Property information
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Increased Home Sales Still Projected for 2007  Earlier this week, TREND released its most recent Economic and Market Watch Report that combines analysis of data from the 1st Quarter of 2007 with projections by local and national economists. In brief, TREND projects house sales to continue to improve throughout 2007 with modest increases in average price and days on market. Key factors in this forecast are relatively strong employment figures in Chester, Delaware and Montgomery counties (despite some job losses) and still historically low mortgage rates. Lawrence Yun, Senior Economist for the National Association of REALTORS, adds about the Philadelphia-area market, "With more jobs possibly coming around [to Philadelphia] given the weakness of the dollar, this should help in lining potential homebuyers. I project home sales to show a year- over-year growth by the fourth quarter with the momentum strengthening in 2008 couple with a respectable rise in prices." Another challenge the local market will continue to face through 2007 are some of the after-effects of the problems caused by Sub-prime loans for a few consumers. Ken Fears, Manager of Regional Economics for the National Association of REALTORS contributed a piece to the Market Watch regarding the cause and effect of the Sub-prime. He states that beyond the lessons learned by the industry and consumers, that the sub-prime issue is helping the market further correct itself. Fears concludes, "What the market is facing is the psychological impact on buyers as they struggle to understand what all of this new information about sub-primes and a slowing economy mean for their buying decision. This waiting and uncertainty for REALTORS may be agonizing, buy it is better for the health of the market in the long-term.
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Note that this information is outdated. Come Rain or Shine - Covered Pavilion 12-3pm When/Where: Fenimore Woods in Radnor
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Want to get a big return on your home-improvement investment? Look outside, not inside. While studies show that you'll only recoup 80 to 90 cents on every dollar you spend to upgrade your kitchen or bath, professional landscape designers estimate that improvements to your lawn and garden can boost your home's value by 7 percent to 15 percent. Those findings have been confirmed by survey results from the Gallup Organization and the National Gardening Association, or NGA. Lawn and garden equity is all the rage these days as homeowners continue to invest heavily in their property values. The NGA says U.S. homeowners spent a $36.8 billion on their lawns and gardens in 2004, $11.4 billion of that on landscaping. Dorcas Helfant, general managing partner of Coldwell Banker Professional Realtors, in Virginia Beach, Va., and the first female president of the National Association of Realtors, says her fellow baby boomers have a far different aesthetic than their parents. "Our parents were not as particular. In the '50s, you had this era of bomb shelters and fear, and the homes we grew up in had these high windows where you couldn't see in or out of them," she says. "Today we don't live like that. We want broad, open expanses and windows that look out on gardens and ponds. We're not willing to live as prisoners in a house." The boomers also are embracing the environmentalism of their youth, according to Linda Engstrom, a landscape designer and owner of Garden Aesthetics in Portland, Ore. "Some of the Chinese principles such as feng shui are coming into play more. As designers, we encourage doing away with your lawn in favor of more ecological plantings. Americans hate to give up their lawns, but it really is something that is not earth-friendly at this point," she says. Homeowners are finding, however, that creating interest and harmony on the outside is far trickier than making upgrades to the inside. The sheer variety of trees (evergreen and deciduous), flowering plants (annual or perennial), and the walls, paths, benches, arbors and pergolas that landscapers call "hardscape" can create a dizzying array of choices and potential missteps. Yes, you can get some creative ideas from popular HGTV shows such as "Curb Appeal" and "Landscaper's Challenge," but flash and dash from someone else's plan won't necessarily work to your home's advantage. "There are a few people out there in the world who have an intuitive sense of how things should be put together, and everyone else doesn't," says Martin Maca, professor of landscape design at South Dakota State University in Brookings. "If you barge ahead on your own, you can make some horrendous mistakes and create some maintenance problems down the road that could have been avoided if you'd hired a designer." Let's look at your home's landscaping with a designer's eye. There are trends out there that may help you paint your garden masterpiece. Elements of style
Wherever you live, proper landscaping can enhance both your enjoyment of your home and its ultimate resale value. The first thing you probably noticed about your home was its curb appeal. Even though your home's appearance from the street is only part of creating the perfect outdoor environment, first impressions are often lasting ones for buyers. "People will drive by a home when the grass is uncut, it looks a little unkempt, and they don't even want to stop," says Helfant. "But if it is a well-manicured, well-maintained yard, they'll say, 'Oh, that's a well-kept home!' Automatically, we connect well-kept interior with well-kept exterior. If I see a home that is not well-maintained on the outside, visually, then I'm going to wonder how that owner has maintained its interior, and more importantly its systems. It may not be verbal, but we can't help but think it." If you're about to sell and money is tight, your best investment is to hire a full-service maintenance company to trim, edge, prune and primp your yard and beds. Even humble landscaping, if well tended, will do more to sell your home than elaborate plantings that have run wild. Designers first consider function when developing a landscaping plan. Do you need a large unobstructed lawn for flag football games? Do you like to watch birds from your breakfast nook? Do you entertain outdoors? Are you crazy about water features? Are views your thing? Next, they'll "age" the existing plantings and hardscape five, 10, 15, even 20 years into the future. Are there problems already in place: a tree that one day will block the view or even threaten the structure, a pool that the kids have outgrown and that no one is using now, obstacles to mowing that, over time, will become eyesores? Now and into the future, your best design will be one that is a) functional, b) maintainable and c) in scale with your house. "One thing that is particularly challenging for us as landscapers is scale," says Maca. "There are huge homes now, and to try to bring those into scale with the landscape is real hard. With smaller houses, we can work with plants in scale, but with these larger houses it takes forever to get a plant up there that is the size of some of these houses. How do you begin to reduce the impact of a four-stall garage?" Engstrom finds herself frequently employing large arbors and pergolas to span the distance between large box and small foliage. "A lot of our newer houses don't have a lot of character, and a pergola can help bring the house down into the garden. If you have a high two- or three-story deck as we have here, we will use the supports to build an arbor or pergola below the deck to help break the height and then put plants on them to help pull the garden up to the high deck."
Do you swim?
Pools used to be the water feature of choice, but not anymore. The explosion of water-burbling options, from dramatic waterfalls to gurgling pottery, has made water features the hot trend in landscaping throughout the grounds. "What's nice about them is the flexibility," Engstrom says. "You can have a water feature for a small amount of money, or you can have an infinity-edge pool and fountain. You can have a pot or rock with a bubbler just for the sound of water that doesn't involve a lot of maintenance or safety issues. It's scalable. I think people love the sound and look of water with soft planting." Maca agrees: "Whether it be ponds or waterfalls or statuary with water attached, water is a magnet in any landscape. It becomes a focal point." Not that swimming pools have fallen completely out of favor, mind you. Realtors have reached an understanding with this love-it-or-leave-it amenity. "People love pools, but it depends on the people," says Helfant. "There are people who wouldn't have one, wouldn't care for one, and would avoid properties with them, just as there are people who go specifically looking for homes with pools. Some people are neutral and will take one if it's there. It's not an item you put in for resale; you provide for it." That means that if pools are hot in your area and your lot can accommodate one, have a pool company quote you a price so that you can make that available to potential buyers when you go to sell. That way, they can roll a pool into their financing package.
Trees add tranquility
Trees are another major aspect of landscaping that add instant character to any home. While water may mask some of the noise from a busy street, trees can actually muffle it by up to 50 percent, according to the U.S. Environmental Protection Agency. There is another reason mature trees are popular: reduced energy bills. "People are going to start becoming more conscious of shade trees, because you can lower the internal temperature in your house 15 degrees," Maca says. Another coming trend: a return to patios. "With decks, most everyone had one, and most of them were designed on one level, rectilinear and not very exciting," says Maca. "Now we're putting in combinations of walls, stone and patios that connect to a deck, and you have three or four interesting spaces. When we talk about creating that outdoor living area, we talk about several subspaces, one for cooking, one for visiting. Fire pits are popular for these. The indoor-outdoor connection is really important, and a designer can help you make that connection." Designers vs. architects
If you're all thumbs when it comes to landscaping, you may wish to consult a professional who does it for a living. For quality help in arriving at a landscaping plan that will make your home pop, you have two choices: a landscape designer or a landscape architect. Landscape designers often come from other design disciplines (Engstrom worked eight years in interior design, for instance) and are unregulated; that is, they are not required to pass a certification test to work in the field. Designers tend to be a cost-effective option for most residential projects that don't require heavy engineering expertise. For this reason, they typically charge less; most are in the $50-$100 per hour range. Professionals such as Engstrom have earned voluntary certification from theAssociation of Professional Landscape Designers. The association's Web site is a good place to look for APLD-certified designers. Landscape architects, by contrast, have four-year degrees in their discipline; serve a lengthy apprenticeship; must pass the Landscape Architect Registration Exam; are licensed in 47 states; and typically work on commercial and public works projects as well as larger residential projects. They may be a good choice if your landscaping challenge involves unusual grade changes or extensive hardscaping, where some engineering expertise might come in handy. But be prepared for steep fees: Top landscape architects fetch anywhere from $150-$250 per hour or more. You can find one at the American Society of Landscape Architects web site. Engstrom says she spends about 30 hours and bills about $1,500 for the average residential landscape design; $2,000 if it involves acreage. Maca says if you're considering using a landscape designer, hire them before you build. "Many times, people don't contact a landscape architect until after the sidewalk is poured, the driveway is poured, the deck is built, and the landscaper comes in and says, 'Oh wow, we could do this if this wasn't already done.' You should contact the designer early; they can turn that rectilinear straight walk into a nice curving path. We can use brickwork and stone to give it a higher aesthetic quality than just concrete." You just might save a few trees, plants and other foliage in the process. "Hiring a landscape designer can help you see the future and design for the present," he says. "I have yet to find a client who was not happy they did it. Most of them say they wish they'd done it years ago." Written by Jay MacDonald is a contributing editor based in Mississippi.
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The Kiotis Ray Team has won recognition for being part of the highest sales producers for the second month in a row!
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Sunny home in north side Villanova
• 3,253 sq. ft., 2 bath, 4 bdrm bi-level - MLS® $639,900 Villanova, Lower Merion - Sunny, well maintained home in prestigious north side Villanova. Enjoy your own magnificent retreat on the back deck overlooking a park like enormous back yard. Permanent awning covers part of the back deck. Comforts abound in this spectacular home including spacious rooms, ceiling fans in all bedrooms, ceramic tile in the full baths, hardwood floors on the upper level and recessed lighting. The entrance foyer has a cathedral ceiling & skylight. Step up to LR, DR thru French Doors w/ sliders to Deck. Lg. eat-in Kitchen w/plank hw floors, double sink, Corian counters, and ample cabinets. Lower Level has lg FR with f/p and sliders that open to patio and 4th bedroom and powder room. Close to Blue Route and Lower Merion schools. Property information
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After several years of record-breaking statistics, the intense activity of the real estate market appears to be slowing, creating new opportunities for those planning to buy or sell a home. Prudential Fox & Roach, REALTORS ® Chairman and CEO Lawrence F. Flick, IV notes, "Home buyers and sellers can take advantage of this changing market in ways not possible during the past few years." This changing market does not come as a surprise to the real estate community. "We anticipated this change and feel that there are many benefits to be gained from a more balanced market," says Mr. Flick. "The fact is this is a great time to sell or buy a home." Buyers are finding that the process of selecting a home and having an offer accepted has become less stressful. "Until now, buyers had few choices and had to make quick decisions," explains Mr. Flick. "Sellers were usually considering multiple offers, so it was not unusual for those whose offers were not accepted to be disappointed. Now buyers can choose from a greater selection of homes and take more time to make decisions." But he cautions, "Properties that are priced competitively and are in great condition still sell almost immediately, so potential buyers need to know when to act." Affordability factors continue to be positive. Mortgage rates have increased, but they are still at historic lows. And while property prices are not expected to decrease, appreciation is expected to occur at more reasonable levels. Positive economic indicators including employment and income growth also point to an ongoing strong local and national economy. Owning a home continues to be a smart investment and is the primary source of wealth and financial security for most American families. Sellers also benefit from this new environment. There are more houses on the market but correctly priced properties in great condition will sell quickly. He advises sellers to hire an agent who does more than facilitate a transaction. "Sales associates who are Value Creation Specialists engineer a dynamic process that actually creates value. By staging a home so it appeals to today’s buyers and creating a sense of excitement and urgency prior to placing the home on the market, they ensure that sellers obtain the best terms and maximum net selling price." Homeowners who wish to sell and ‘move up’ can take advantage of less aggressive appreciation rates. "A more expensive house becomes more affordable and a better overall investment," says Mr. Flick. Selecting a top real estate sales associate and broker is even more important in a changing market. "It is essential that buyers and sellers choose an agent with the knowledge and experience to help them make the best decision." When selecting a real estate company, choose one that is a powerful force in the market and has a long standing reputation of integrity. Companies that offer a full array of services like mortgage and insurance are a first choice with buyers and sellers alike. "Recent surveys indicate that consumers prefer working with a company with a trusted name that offers clients excellent service through the convenience of one-stop shopping." Prudential Fox & Roach, REALTORS ® , the nation’s fourth largest provider of home services inthe United States, is an independently owned and operated member of the Prudential Real Estate Affiliate, Inc. and the largest Prudential affiliate in the country. As the Tri-State area’s real estate leader, the company has more than 64 sales locations and 3,700 associates. Through its affiliate, the Trident Group, the company provides one-stop shopping and facilitated services to its clients including mortgage financing and title, property and casualty insurance. Visit our Website at www.prufoxroach.com.
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