Monthly Archives: November 2012

Federal Reserve’s Beige Book: Economy in Texas Growing Stronger

Bank One CenterThough the US economy is going through tough times, reports by the Federal Reserve indicate some improvements in some states. According to the Federal Reserve’s Beige Book, the economy of Texas, as well as that of two neighboring states, has actually grown moderately stronger over the past six weeks.

The economic reinvigoration experienced by these states is largely contributed to housing, energy and construction activities in Texas, Louisiana, and southern New Mexico.

Also, contrary to rumors regarding the US financial sector, reports based on the Fed’s twelve districts around the country showed slight improvements in regards to its economic growth since the last report published September 9.

On the other hand, reports also indicate a leveling off of economic activities in New York, while Kansas City showed slower growth. Nonetheless, the majority of the twelve districts reported notable growth in home sales, retail sales, vehicle sales, as well as tourism activity and residential construction.

Meanwhile, employment conditions hardly experienced any changes, and the commercial real estate markets remained mixed. The Beige Book also states that the national economy was enhanced through the sale of vehicles, real estate properties, and constructional developments.

For the Dallas District, single-family housing activities and apartment construction began to pick up since there was only a limited supply, therefore causing an increase in the average prices.

The energy sector’s business remained strong, despite the fact that the active rig count slightly declined. Crude oil prices shot up to nearly $99 per barrel, while purchasing costs for natural gasses stayed depressed. Moreover, Gulf Coast refinery margins were reported to reach its highest level in four years.

Demand for staffing services of Dallas decreased slightly, but firms in this industry believe that things will be looking brighter for them within the next few weeks. Regardless, reports show that demand for services in accounting, engineering, transportation, mortgage processing, steel, and energy have increased favorably.

Lastly, numerous companies were interviewed to determine employment demand in Dallas. Amongst those surveyed, their number of employees either remained steady or increased. Furthermore, these corporations were short of several positions, including truck drivers.

First Industrial Sells Mixed-Use Property For $5.3 Million

Business for First Industrial Realty Trust, an established REIT and owner of numerous industrial real estate developments, has gotten a little better after its sale of a 56-acre property at 4300 Cemetery Road in Hillard, Ohio.

According to reports, the property was sold for $5.3 million to a real estate development corporation known as Continental Real Estate Cos., who intends to use its latest asset for an upcoming mixed-use project.

First industrial was finally able to complete its exit from the Columbus market with the completion of this transaction, along with ten others which took place last September. The investment firm reportedly sold nearly three million square feet of distribution and warehouse space within the region to Garrison Investment Group of New York and Dallas-based Westmount Realty Capital LLC for $38.7 million.

Despite successfully disposing these properties, the sale of the ten-property portfolio resulted in a considerable loss. First Industrial paid $65.5 million to acquire the properties from 1996 to 2007. Regardless, the corporation is now looking to improve their standing after selling these properties, as most suffered from issues with high vacancies.

Removing assets, which were more like liabilities, from their portfolio is part of their strategy to improve its overall quality. This company intends to acquire its short-term and long-term liquidity from asset sale, continued equity issuance, as well as the issuance of additional secured debt.

First Industrial was founded back in 1994, and has managed to channel its focus towards the acquisition, development, management and sale of top-of-the-line industrial spaces. They operate within major markets across North America, dealing transactions which involve bulk or regional distribution facilities and other variations of industrial facility types.

In addition to this company, they also own and manage a diversity of real estate assets, as well as provide supply chain solutions to multinational corporations and regional customers, which range anywhere from a thousand square meters to over one million square meters.

Experts believe that First Industrial will be able to improve its standing after having disposed of its liabilities by way of sale, and its decision to look into different investment opportunities in various markets.

Hillwood Communities Bat For Urban Agrarianism

A large residential development project kicked off recently in Denton County incorporating the novel concept of urban agrarianism. The undertaking is a partnership between Hillwood Communities and Realty Capital, and it seeks to develop a 1,000-acre master-planned, mixed-use community at the northwest corner of I-35W and FM 407 in Northlake and Argyle.

The entire project cost is $1 billion, a truly large residential project that will involve the construction of about 3,000 single-family homes. The prices of these residences will range from around $200,000 to about $400,000. Its initial phase consists of 323 homes, which will be built around core amenities. These community facilities will include swimming pools, hike and bike trails, an amphitheater, and a community farm. A historic edifice, the 1882 Faught House, is being restored to serve as a hub for community activities.

Hillwood has assembled a consortium of prestigious names in real estate development as its partners in implementing the new community’s blueprint. These firms include Coserv and Environments for Living, Premier Communities,, Verizon, and Atmos. Together with these concerns, Hillwood expects delivery of its new community’s LiveSmart design that focuses on the establishment of  a residential neighborhood with the lowest impact possible to the natural environment. One component of this design is a community farm from which the Hillwood residents can source fresh, farm-to-table organic produce.

Ross Perot Jr., Hillwood chairman, explained that the new concept of urban agrarianism is focused on providing healthful living, sustainability, and a grassroots community set in a rural environment. Perot emphasized that Hillwood’s vision is to bring residents together in a community where appreciation and caring for the environment is the norm. What they hope to cultivate, he added, are farm-to-table entrepreneurs, urban farmers, and gardeners within the new neighborhood.

Their newly launched project, according to Hillwood president Fred Balda, is geared at providing future residents with a long-lasting community with walkable and highly livable features that at the same time protect and preserve the property site’s rural character.

Home construction for the first phase of the Hillwood project will be undertaken by three well-known home builders—MHI, David Weekley, and Highland Homes.  The Hillwood development project is one manifestation of the growing builder confidence across much of the United States. A reading of the housing market index this July showed that builder confidence rose to 35 index points, the highest level since March 2007. Gains were recorded in every region and every industry component.

How Dogs Can Damage Properties

Dog and Cat Reclining on a BlanketAn estimated 39% of US households have 78 million dogs.  However even with the joy that these furry friends can bring, they can still cause damage to properties. This was the situation with a woman who purchased a home in East Bay the previous year and still has not moved in.

Dogs and Cat

The woman visited the house the second time and was greeted by four resident dogs who appeared to be well-behaved.  Both the buyer and the agent did not notice anything unusual with the property and agreed to buy it.

The seller provided disclosures and reports indicating some problems such as damaged windows.  Upon inspection by window specialists, it was found out that the damages were more serious and all the remaining windows would have to be replaced in the next two years.

Transaction Resurrected

The buyer asked for a lower selling price because of the damages.  Both parties reached no agreement and the contract was canceled.  However after reducing the price, the buyer eventually purchased the property.

Moving In

While the buyer was moving in with her two dogs and some furniture for the first time, she smelled something unpleasant and strange in most areas of the house.  She found the stench to be urine.

Further Inspections

The seller’s disclosures did not indicate any such issue on the property.  The buyer and her agent did not smell any urine during their previous visit.  Inspectors were hired and tests confirmed the urine stains.  In various spots throughout the house, the urine had penetrated behind walls and into the sub-flooring.

Seller Denial

The seller denied any urine problems when asked.  The buyer hired an attorney and a year later the seller still remained in denial and the buyer remains stuck and had to endure emotional and financial damage.  Only time will tell whether the seller was truthful in saying that she was unaware of such damage or not.

Final Thoughts

Tiles are not waterproof and can absorb moisture or in this situation, urine.  Dogs, even if potty-trained, can still do their business inside the house.

Importance of Agent Websites

Importance of Agent WebsitesAs buyers and sellers, one of the things that should be high up on the to-do list is to choose a Realtor that owns a personal website.

The California Association of Realtors conducted a survey recently comparing the experiences of the traditional buyers and buyers through the internet.

Findings of the Study

The survey showed the following characteristics of the internet buyers:

  • Mostly relied on the Internet for information on specific properties
  • Used the net most of the time for information on home buying process, which included the financing options
  • Spent lesser time searching and purchasing a home and visited less number of homes
  • Better prepared in buying homes
  • Aged younger, with 32 as the median age vs. 38 to that of traditional buyers
  • With better education and seen in managerial or professional jobs and with higher incomes
  • More likely to be males
  • Have bought more high-priced houses

In conclusion, it is more likely for internet buyers to team up with an agent with strong presence in the net than those with none.

Seller’s Perspective

A seller needs to maximize the quality and number of offers even with the hot market.  Currently, a house feature on the internet has become important as a Multiple Listing Service feature.

A number of internet buyers have visited several Realtor websites as often as the company sites to search for listings.  As a seller, being listed in both provides greater exposure for the property.

Before working with an agent, the following questions need to be considered:

  • How easy was it to find the agent’ s site?
  • Does he have his/her own local listings featured?
  • Are his/her listings displayed interesting and attractive to view at?

Personal website or Company site

Personal sites allow constant updating and creative designs compared to company sites where all agent pages look similar and individual differences are limited.

Final Thoughts

Internet presence is indispensable for businesses.  Real estate agents must have strong net presence to market themselves and the services and properties they offer.

Why Buyer Representation is Needed

Before you start searching for a home and commit with a Realtor, you should first have an idea on what Buyer Brokerage is.  Many home buyers are not familiar with Buyer’s Broker, ABR (Accredited Buyer Representative), or Buyer Representation benefits.

According to the 2001 survey of NAR or National Association of Realtors, 46% of buyers in the country who have experience working with real estate professionals chose to get a personal Buyer Representative.

Even though signing for listing agreement with a broker is routine for sellers, local buyers do not usually have the same contractual agreement or deal with their real estate agent.

Reason why buyers need to sign

  • It is a proof of the agent’s sincerity.
  • Your eagerness on having a written contract or agreement indicates that you are interested in buying.
  • Right from the start, it clears up the crucial agency relationship between you and the Realtor, which is important in “dual agency”.
  • Your agent can represent you better.  Your agent will show all the properties for sale in the market.
  • The agreement will specify you and your Buyer Representative’s obligations and duties.  You will get a 2-page “Buyer Inspection Advisory” during the outset instead of receiving it before an offer is made.
  • It shows how the agent’s compensation works.

To avoid being obligated to work with an agent that you barely know, you can state in your Buyer Broker agreement that you or the agent can cancel the contract any time within 24 hours with written notice.

Misconceptions on Commissions

  • Commissions are paid by sellers but in actual it is always the buyer who does it since the amount is factored by the property price.
  • Agents barely do anything to receive high commissions however in truth, agents also have to perform a number of services.
  • Several buyers think that agents receive the entire commissions but the commissions are actually split between the listing and selling agents.

Final Thoughts

Having an agent ensures that you will have a better protection and service when buying a home.

Dallas-Fort Worth in the Top 10 Commercial Property Markets List

2013 sees the dawn of a new year burgeoning with promise for commercial property markets all across the United States, but three lucky cities in Texas look likely to benefit more than most. Real estate property execs have theorized that the Dallas-Fort Worth stretch is set to become one of the United State’s cutting edge locations in the future of commercial property development.

Soaring in at number nine on the hit list revealed by the accounting firm, PricewaterhouseCoopers International, and the Urban Land Institute, is the D-FW area. The three major cities that make up D-FW came in right behind Houston as one of the most diverse and opportunistic job-providers, according to their ‘Emerging Trends’ report. Further analysis gave more insights into the Dallas market, stating that as long as Dallas keeps up its energy revenues, it will be able to claim one of the hot seats in the top ten commercial property markets list.

Other locations that have garnered interest in the real estate property market list encompass San Francisco, San Jose, New York, Austin, Houston, Seattle, Washington D.C. and even Boston. A forecast based upon a poll undertaken by property market experts has denoted substantially better prospects for all US sectors and markets in 2013, as compared to its disappointing previous year. However, coastal markets had the lion’s share of the poll results, thus rendering them slightly skewed.

Although Dallas gains recognition for its strong economic growth, critics have shot down the city’s prospects, nitpicking on its tendency to indulge in vast developmental landscapes. But execs polls immediately raced to Dallas’s defense by highlighting the high availability of job vacancies in downtown offices, and this excludes establishments in the Uptown and Legacy Business Park that are copped to the brim. The report stated that warehouses are in overabundance in Dallas, but this is clearly wrong since the local industrial properties paint a very different picture.

Pest Damage Control for Foreclosed Properties

Foreclosure investors or Real Estate-Owned agents often have to deal with minor problems such as pests, which can often progress into serious threat.  A number of short sale, distressed, and foreclosed houses suffer invasion from pests and this occurs when critters start to move into the property as soon as dwellers move out.  With no homeowners to chase away the pests, foreclosed properties become a haven for insects and pests.

After purchasing a foreclosed house, starting the pest control is the next move to take.  Whether the buyers plan to live in the property or put it up for sale, clearing the pests out is important.

Mosquitoes

Houses with stagnant water-filled areas such as pools can turn into a mosquito breeding ground.  While pouring chemical solutions is a good move, this can have lifelong impact on the surroundings.  One natural solution is to drain the pool to allow the larvae to die under the sun.  For adult mosquitoes, the use of environment-friendly mosquito traps or UV attractors are helpful.

Wasps and Bees

Trees, roof overhangs, and gutters can be used by wasps and bees as grottos.  An effective way to eliminate them is to destroy the hives or move their Queen.  This will force them to seek out another location

Termites

Termites are a threat to houses made of wood and to the future homeowners.  To stop the termite infestation, it is better to contact pest control, especially if the infestation has become large.  Killing the Queen is also another option.

Ticks, fleas, and other insects

Foreclosed homes may also be homes to dormant fleas if the previous dwellers had pets.  To kill the dormant eggs, clean the house using powder mixed in cleaning water or a flea soap.  Ticks and other insects are also bred from overgrown yards.

Spiders

With spiders in the house, smaller insects are kept at bay.  However spider eggs and webs are unsightly and may even scare potential buyers.

Rodents

Abandoned homes are likely to attract rodents including rats.  If a large number of rodents are seen in the house, it is better to seek professional help.  Using poisons and humane traps are options as well.

Strays

Stray animals may consider abandoned homes their territory and attack anyone to enter the property.  It is possible that these animals are infected with diseases.  If this is the case, call the nearest Animal Control shelter.

Controlling large pest infestations is necessary.  Before things get out of control, it is always a good idea to call a pest control company.  This will prevent homes from being damaged further.  However one should be aware that controlling infestations take time.

A Smaller Dwelling during Retirement

Most retirees think about ways on how to stretch the funds to make the money last longer.  One good method is to purchase a modest house.

Home downsizing during retirement can often reduce expenses and can provide retirees a little more money from the previous home sales.  This is effective if the mortgage on the larger dwelling has already been paid off.

Advantages of Purchasing a Modest House

Owning a small residence makes sense for a lot of retirees with kids having grown up and living independently.  Maintaining and cleaning the place is also a lot easier.  There is no need to spend much money and time on its maintenance.  The following are some of the cost advantages of having a modest house:

Lower utility bills:  Because the place is small in size, the use of utilities such as water and electricity is also at a minimum, which translates to lower bills.

Lower taxes on property:  Government appraisal for smaller residences is more likely to be lower, which means that the property tax is also lower.

Lower number of purchases:  Purchases also become lower with not enough room to put the items for storage.

Do a calculation if it is possible to live in comfort with minimum budget.  Choosing a smaller place might be the solution since it means being able to save money.  This can also ease the flow of the retirement fund.

Cash Infusion from Modest Home Purchase

With a modest house, paying off the mortgage is easier and can be accomplished come retirement time.  Make sure to create an effective retirement scheme that will pay off the mortgage, help reduce monthly obligations, and provide the ability to purchase a new smaller residence.

Buy a smaller place using the amount paid from the larger dwelling.  The remaining cash can even be used for a trip or investment.  If used appropriately, a little amount can last a long time.

It might be tempting to purchase another mortgage, however calculating the cost thoroughly is important.  Remember that the main goal here is to reduce the obligations during retirement and not to add one.

A Bigger Residence during Retirement

A number of retirees are not interested in modest homes and prefer a lifestyle upgrade instead.  Having a bigger place to accommodate visits from the children and grandchildren is also a nice idea however before buying one make sure that all the bases have been covered during the calculation.

Putting up the old house for sale can help a lot since the sale amount can be utilized as down payment for a new purchase.  See to it that the retirement budget can cover the additional expenses of having a larger place, including the utility costs and house maintenance.

A house with a paid mortgage can provide several options.  One can choose lifestyle downsizing using the sales of the house or one can go for a less expensive upgrade.  The important thing is to consider various options prior to the purchase.

Dallas-Fort Worth Home Sales See Notable Increase

Emerging from the economic crisis which rocked the nation back in 2008 are a number of housing markets within the US, including that of northern Texas, wherein home sales increased by an impressive 29 percent last October of this year. According to analysts, the improvement of this housing sector is accurately described by a trend wherein buyers are taking advantage of low financing costs.

Based on data recently released by the Real Estate Center at Texas A&M University, last month witnessed the largest increase in sales of pre-owned single-family dwellings over the past three years, an achievement that real estate agents in Dallas-Fort Worth area are particularly are proud of.

“The market has continued to strengthen through the fall,” says David Brown, head ofDallasoffice of housing analyst Metrostudy Inc. “With interest rates at historical lows, demand for both new and existing homes has remained strong.

He also added: “It looks like sales will remain strong through the end of the year, with pending sales up 20 percent from a year ago.”

In addition to statistics gathered from last month, home sales withinNorth Texashave been rising for sixteen straight months. Moreover, home prices have jumped up to an impressive nine percent in comparison to data gathered from last month.

“The strong increase in home sales this year suggests consumers are feeling more comfortable,” says D’Ann Petersen, an economist at the Federal Reserve Bank ofDallas.

She also added: “Thanks in part to very low interest rates, buying a home now makes sense to many North Texans who might have been waiting for a sure sign of market recovery,”

Petersen went on to explain how the rapid increase of apartment rentals of 2012 has attributed to the pre-owned home market growth.

According to the Real Estate Center and the North Real Estate Information Systems, real estate agents witnessed a seventeen percent increase in home sales through MLS in comparison to the same span of time during 2011.

Upon examining the gathered data even closer, experts noted a 79 per cent increase in home sales last October in comparison to the same month of last year within theNorth Dallasarea. Moreover,Northeast Dallassaw a 71 percent increase, while the Far North Dallas and Coppell witnessed a 59 per cent increase.

“The limited supply of available homes and improved sales are likely to lead to above normal home price appreciation through the end of the year and into 2013,” says Brown “The recovery in the housing market is continuing to gain momentum.”