Here is a real estate update for the Laguna Beach area as of December 6, 2011. The data is broken down by area and areas mentioned are: Newport Beach, Corona del Mar, Newport Coast, Laguna Beach, Costa Mesa - Eastside, Dana Point, San Juan Capistrano, Laguna Niguel, San Clemente, Shady Canyon - Custom, Turtle Ridge, and Aliso Viejo.
Laguna Beach Market Stats Dec 6 2011
Friday, December 9, 2011
Wednesday, December 7, 2011
Phenomenal Deal for a Home at Donner Lake!!!
Looking for a vacation home in Truckee at beautiful Donner Lake? This home is a phenomenal deal! Not a short sale or an REO, but priced like one!
Just reduced to $300K!! This is a killer deal for a home at Donner Lake!
Details on Donner Lake Home
3 bedrooms/2.5 bathrooms/1900 sq. ft.
Property Description
Just steps from Donner lake, this thoroughly remodeled, easy to care for, 3 bed/2.5 bath home has all the amenities one could want. The home boasts beautiful granite and slate accents throughout, great appliances, brand new tankless water heater, a central vacuum, and jacuzzi tubs that will make your lifeby the lake easy. Have friends over (plenty of parking) and enjoy a glass of wine on the deck with the filtered lake views.
13351 Sierra Drive
Just reduced to $300K!! This is a killer deal for a home at Donner Lake!
Details on Donner Lake Home
3 bedrooms/2.5 bathrooms/1900 sq. ft.
Property Description
Just steps from Donner lake, this thoroughly remodeled, easy to care for, 3 bed/2.5 bath home has all the amenities one could want. The home boasts beautiful granite and slate accents throughout, great appliances, brand new tankless water heater, a central vacuum, and jacuzzi tubs that will make your lifeby the lake easy. Have friends over (plenty of parking) and enjoy a glass of wine on the deck with the filtered lake views.
13351 Sierra Drive
Tuesday, November 22, 2011
Thursday, November 17, 2011
HÔM REAL ESTATE GROUP & Sotheby's International Realty
Exciting news for Hom Real Estate Group! It is now affiliated with Sotheby's International Realty!
HÔM REAL ESTATE GROUP & Sotheby's International Realty
HÔM REAL ESTATE GROUP & Sotheby's International Realty
Monday, October 24, 2011
HOM Real Estate Group & Sotheby's International Realty
 HÔM REAL ESTATE GROUP IS PLEASED TO ANNOUNCE WE HAVE JOINED THE SOTHEBY'S INTERNATIONAL REALTY NETWORK |
In today’s complex real estate market, it is important to capture every opportunity to better serve our clientele. To further our efforts, it is with great pleasure that we announce our affiliation with Sotheby’s International Realty Affiliates LLC.
For the past six years, HÔM Real Estate Group has been committed to providing quality service and extraordinary marketing in representing our clients and their properties. An alliance with a company specializing in the exposure of the finest properties world wide—enables us to market your property with the added benefit of a global network, accessing a broad, qualified client base including those associated with the Sotheby’s Auction House. HÔM Real Estate Group in association with Sotheby's will continue to be one of the strongest companies in the area providing superlative resources for you and the exposure of your property.
We look forward to a continued working relationship with you.
Sincerely,
Maura ShortTuesday, March 8, 2011
Is Now the time to buy?
Good words from the KCM Blog:
There is a very famous saying which asserts “Sell High, Buy Low”. It is obviously great advice no matter what the investment. Below is a graph showing the cycle of investments. It shows the points of maximum risk and maximum opportunity when purchasing. We want to sell high (point of maximum risk) and buy low (point of maximum opportunity).
The challenge is how to determine when we have hit bottom if you are a purchaser. The only time you can guarantee a bottom is after you pass it.
However, there is more and more evidence that the COST of a home has in fact hit bottom. Notice we have used the word COST. Unless you are an all cash buyer, you must take into consideration the expense of financing a property to determine the true cost of purchasing the home. Interest rates have increased over the last quarter; and the rise in rates has counteracted any fall in prices.
Let’s look at an example:
Let’s say you were going to take out a $200,000 30-year-fixed-rate mortgage in November of 2010. At that time, interest rates were 4.17% (as perFreddie Mac). Your principle and interest payment would have come to $974.54. According to the most recent report from Case Shiller house prices fell 3.9% in the 4th quarter of 2010. The most recent report from the Federal Housing Finance Agency shows a 0.8% fall in prices. Let’s use the larger percentage decrease: 3.9%.
For the sake of keeping the math simple, we will now say you can get the same house with a $192,000 mortgage (4% discount from November price). Interest rates are now 4.95% (as per Freddie Mac).
Your principle and interest payment would now be $1,067.54.
By waiting to pay less for the PRICE of the house, the COST increased $93 a month. That adds up to $1,116 a year and over $33,000 over the life of the loan.
We realize that there are other things to consider (ex. the mortgage tax deduction, etc.). This example is just a simple way to show that there is a difference between COST and PRICE.
There is a very famous saying which asserts “Sell High, Buy Low”. It is obviously great advice no matter what the investment. Below is a graph showing the cycle of investments. It shows the points of maximum risk and maximum opportunity when purchasing. We want to sell high (point of maximum risk) and buy low (point of maximum opportunity).The challenge is how to determine when we have hit bottom if you are a purchaser. The only time you can guarantee a bottom is after you pass it.
Let’s look at an example:
Let’s say you were going to take out a $200,000 30-year-fixed-rate mortgage in November of 2010. At that time, interest rates were 4.17% (as perFreddie Mac). Your principle and interest payment would have come to $974.54. According to the most recent report from Case Shiller house prices fell 3.9% in the 4th quarter of 2010. The most recent report from the Federal Housing Finance Agency shows a 0.8% fall in prices. Let’s use the larger percentage decrease: 3.9%.
For the sake of keeping the math simple, we will now say you can get the same house with a $192,000 mortgage (4% discount from November price). Interest rates are now 4.95% (as per Freddie Mac).
Your principle and interest payment would now be $1,067.54.
By waiting to pay less for the PRICE of the house, the COST increased $93 a month. That adds up to $1,116 a year and over $33,000 over the life of the loan.
We realize that there are other things to consider (ex. the mortgage tax deduction, etc.). This example is just a simple way to show that there is a difference between COST and PRICE.
Bottom Line
If you want to buy low, buy now. It appears COST has hit its lowest point.Tuesday, February 22, 2011
Like a Phoenix Rising from the Ashes
From the KCM Blog:
The real estate market has experienced difficulty over the last five years. From 2000-2006, house values climbed to unsustainable heights. Since then, we have seen much of this appreciation disappear. Now many look at the housing market as dead and lying in the ashes of its previous glory. However, there is growing evidence that, just like the Phoenix, there is a new market currently rising from those ashes.
Pete Flint, CEO of Trulia said in a recent press release:
The real estate market has experienced difficulty over the last five years. From 2000-2006, house values climbed to unsustainable heights. Since then, we have seen much of this appreciation disappear. Now many look at the housing market as dead and lying in the ashes of its previous glory. However, there is growing evidence that, just like the Phoenix, there is a new market currently rising from those ashes.Buyer activity is increasing
The first sign of an improving market is buyers again beginning to shop for a home for themselves and their family. That is taking place right now.Pete Flint, CEO of Trulia said in a recent press release:
“We’re seeing a national resurgence of buyer and seller activity on Trulia.com. In January alone, we experienced an unprecedented level of site traffic including 11 million unique visitors – which is more than 70 percent year-over-year growth… (We) are now experiencing 100,000 property views per minute.”The latest Credit Suisse Monthly Survey of Real Estate Agents reports:
Our Monthly Survey of Real Estate Agents pointed to another month of improved traffic – the third straight month, andthe highest level for our traffic index since April 2010, the last month of the homebuyer tax credit. The improved economy and stronger consumer confidence has translated into an increase in homebuyer traffic.
But have they actually started purchasing?
The best news is that buyers are not just looking. The latest National Association of Realtors’ (NAR) Pending Sales Report, which quantifies the number of homes going into contract, shows continued improvement:Pending home sales improved further in December, marking the fifth gain in the past six months.
Bottom Line
Buyers are back out looking at homes and the number that are actually purchasing is steadily increasing. It appears the housing market is on the verge of a rebirth. The Phoenix is beginning to flap its wings.Thursday, February 17, 2011
5 insider secrets for Buying your first home.....or any home for that matter
Great article from Trulia........
Buying a home is not a discrete event; it's a process - a sequence of events that happens over time, sometimes over as long as several months or even years! While general guides to buying a home are a dime a dozen, I'm excited to share with you some insider secrets you may not have heard elsewhere - one for each stage involved in buying a home. Here's to helping you make the best decisions at every phase of your homebuying process!
Stage One: Deciding Whether It's The Right Time to Buy.
Insider Secret: The market is the least important factor you should consider when deciding whether and when to buy a home.
Why: Everyone knows affordability is at an all-time high. Home prices are low, and so are interest rates. But trying to time the market is a fool's errand; many who get caught up in that game of trying to make sure they buy at the absolute bottom will end up losing out on very, very favorable conditions.
Beyond that, the most important considerations when deciding whether and when you should buy a home are personal, not market driven. On today's market, it only makes sense to buy a place if it's going to be sustainable and work for you for at least the next 4-5 years [if your town's real estate market has been fairly recession-proof] or 7-10 years [if the housing/foreclosure crisis has hit your area pretty hard].
Against this "smart holding period" backdrop, smart buyers decide to buy when it makes sense for:
Stage Two: Getting Pre-Approved.
Insider Secret: Working with a mortgage broker referred by your real estate broker or agent may save you money.
Why: Bolstered by the real-life stories of a couple of bad apples, TV pundits and some consumer advocates have spun the tale of a real estate industry cartel, whereby sinister agents hook unsuspecting buyers up with shady mortgage brokers, who place them in crappy loans and kick back some bucks to the agent. I'm here to tell you, in my experience, the opposite is true the vast majority of the time.
When you work with a mortgage broker who has a strong track record of helping your real estate agent's clients out, you end up in a best of all worlds situation, nine times out of ten. First off, your agent will take you much more seriously once a mortgage broker they know and trust has run your credit, checked your income and approved you for a loan, as well as communicated with your real estate pro about your qualifications and what you can afford. Secondly, your agent can help you communicate with your mortgage broker, sometimes helping get past appraisal glitches or facilitating other workarounds, as they come up. Third, you get the assurance of working with a mortgage pro who has been vetted and vouched for by someone you not only trust, but someone who can verify that the mortgage broker has the ability to get transactions closed in the timely manner required of today's real estate sales contract. Otherwise, you may end up working with a competent mortgage broker who has a great track record when it comes to refinancing, but can't keep up with the pace and common obstacles to getting a home financed in the context of a sale.
On top of that, sometimes the relationship can help you negotiate out of a couple of line item loan fees (if your particular mortgage rep has the power to get them down at all), if push comes to shove and cash is tight to close the deal. Assuming you are working with a real estate pro you really trust, working with a mortgage broker they trust can save you, rather than cost you, money.
Stage Three: House Hunting
Insider Secret: "Distressed" doesn't always equal "discounted" - in some cases, a "regular" sale can be a deeper deal.
Why: Short sales and foreclosures have grown to comprise roughly 30 percent of the homes sold on today's market, even higher in some areas. The average sale price of foreclosed homes was 32% lower than the average sale price of non-foreclosed homes, at last count. However, it's not always the case that foreclosed homes or short sales - homes which are being sold for less than what the seller owes on their mortgage(s) - offer the buyer a fabulous discount.
Mortgage servicers and asset managers who make decisions about distressed properties are on the hook to their investors to recoup as close as possible to the current fair market value of every home they sell. Some banks even have a general rule of rejecting offers more than 10 percent or so below the home's list price, preferring instead to reduce the price by that amount and put the home back on the open market to see if any new buyers are activated by the price reduction to make an offer better than the lowball offer that was initially put on the table. On short sales, the bank is trying to get as close as possible to recovering what the seller owes - and may or may not be concerned with what the fair market value of the home is. (Nine times out of ten, there will be a big gap between fair market value and the seller's outstanding mortgage balance. If there wasn't, the seller wouldn't need to do a short sale!)
With so many distressed properties and homes with depressed values on the market, in many areas, the individual, non-distressed home sellers who are putting their homes up for sale right now are those who are very motivated to sell. Further, they are more likely to be flexible with you on everything that is negotiable, from contingency and escrow periods, to price, to repairs and included items.
Also, individual sellers can be emotionally motivated to sell to move on with their lives, get into their bigger (or smaller) house, or move on to their next job; banks, on the other hand, aren't people (!), so lack that emotional sense of urgency to get the properties sold, no matter how urgently you may think they should be trying to get rid of the foreclosed properties they own. (If you've heard the old advice that banks don't want to be in the home-owning business, I can tell you this. That is true, in a very general sense, but now they are and will be - for a long time to come. They have no emotions, have no urgent need to sell or move, and are not willing to give houses away at pennies on the dollar to get out of it, no matter what those infomercial folks say.)
Long story short: you can sometimes negotiate a better deal with an individual seller on a "regular" sale than with a bank on a distressed home sale. So, don't limit your house hunt to foreclosures and short sales, if you're looking for a good deal on your home.
Stage Four: Negotiations
Insider Secret: Your family and friends can cause you to lose your dream home.
Why: With so much information on the web and the news every day about the recession and the buyer's market, everyone seems to be an armchair economist/real estate savant. But much of that news is national and based on medians, averages and trends. That is, it might not necessarily apply to every home on the market in every city, and more importantly, it might have nothing to do with "your" particular home.
When I was a little girl, my best friend's grandfather would very carefully hand each of us a quarter, always doling it out with the sage admonition: "Don't spend it all in one place." We'd always smile, look at each other, then go ask our Moms for ten bucks apiece. In the same vein, people who are not currently in the market for a home have no idea what an individual home should "go for." If you tell your parents, church pals, or colleagues at work the blow-by-blow details of your offer, counteroffers, etc., you should expect to hear things like, "Oh, you're paying way too much!", "I think you should push them down another $10K," or "You know, you're in a better bargaining position than that." And sometimes, taking that sort of advice will end up blowing your deal. Work with your trusty real estate broker or agent to develop a smart strategy - with their experience in your local market - about what price and terms to offer. Then keep working with them to manage and maintain realistic expectations as you proceed through negotiating the contract to buy your home.
Stage Five: Escrow, Inspections and Underwriting
Insider Secret: It's critical that you attend your home inspections.
Why: When it comes to inspections, many first-time buyers expect that a home will either pass or fail. Except in a few jurisdictions where the government imposes certain condition requirements for a home to be sold, the home inspection is more about educating you, the buyer, as to the details and nuances of the home's condition than about seeing if the place hits a particular target for "good" or "bad" condition.
Home inspectors don't just look for things that need fixing, they also look to understand the home's systems and features, as well as to point out areas that will require your ongoing maintenance, highlight emergency shutoffs and other need-to-knows, and indicating where you should have specialists further inspect items of concern. Many home inspectors create vivid, detailed electronic reports - some, complete with color photos. But that's not enough!
If you're physically onsite at the home during the inspections, the inspector can physically show you the shutoffs for water, gas and electric - and how to use them. They can also point out, in person, any things that need repair, and give you some tips for maintaining the place in tip-top shape. Also, in many states, the general home inspector is legally prohibited (vs. the pest, roof or other "specialty" inspectors) from issuing a written quote or bid for repairs, to avoid a conflict of interest where they'd try to fabricate flaws in the home to get the repair job. However, the repair costs are one of the most important things a smart buyer wants to know!
If you show up, many inspectors will give you a rough range it would cost you to do various repairs, or otherwise indicate to you whether the needed repairs are "big deal" or "$10 home improvement store" fixes; some will even give you a few references to contractors they trust.
All around, you'll get much more of the detailed information you need to know whether and how to move forward with the transaction if you should up in person to the home inspections, rather than just waiting for a copy of the report to come to your email.
Buying a home is not a discrete event; it's a process - a sequence of events that happens over time, sometimes over as long as several months or even years! While general guides to buying a home are a dime a dozen, I'm excited to share with you some insider secrets you may not have heard elsewhere - one for each stage involved in buying a home. Here's to helping you make the best decisions at every phase of your homebuying process!
Stage One: Deciding Whether It's The Right Time to Buy.
Insider Secret: The market is the least important factor you should consider when deciding whether and when to buy a home.
Why: Everyone knows affordability is at an all-time high. Home prices are low, and so are interest rates. But trying to time the market is a fool's errand; many who get caught up in that game of trying to make sure they buy at the absolute bottom will end up losing out on very, very favorable conditions.
Beyond that, the most important considerations when deciding whether and when you should buy a home are personal, not market driven. On today's market, it only makes sense to buy a place if it's going to be sustainable and work for you for at least the next 4-5 years [if your town's real estate market has been fairly recession-proof] or 7-10 years [if the housing/foreclosure crisis has hit your area pretty hard].
Against this "smart holding period" backdrop, smart buyers decide to buy when it makes sense for:
- their life plans (i.e., they are comfortable making the commitment to live in the same town, and the commitment to )
- their family plans (i.e., whether they plan to get married, have children or empty their nest in the time they plan to own the home - and the implications of these plans on their space needs and location priorities)
- their career plans (including, but not limited to: whether they have job or income security, whether they feel they will be working in the same area for the foreseeable future, and whether they want to work less or start their own business in the months or years to come)
- their financial plans (including foreseeable changes in income and expenses, e.g., kids going to college or making partner at the firm).
Stage Two: Getting Pre-Approved.
Insider Secret: Working with a mortgage broker referred by your real estate broker or agent may save you money.
Why: Bolstered by the real-life stories of a couple of bad apples, TV pundits and some consumer advocates have spun the tale of a real estate industry cartel, whereby sinister agents hook unsuspecting buyers up with shady mortgage brokers, who place them in crappy loans and kick back some bucks to the agent. I'm here to tell you, in my experience, the opposite is true the vast majority of the time.
When you work with a mortgage broker who has a strong track record of helping your real estate agent's clients out, you end up in a best of all worlds situation, nine times out of ten. First off, your agent will take you much more seriously once a mortgage broker they know and trust has run your credit, checked your income and approved you for a loan, as well as communicated with your real estate pro about your qualifications and what you can afford. Secondly, your agent can help you communicate with your mortgage broker, sometimes helping get past appraisal glitches or facilitating other workarounds, as they come up. Third, you get the assurance of working with a mortgage pro who has been vetted and vouched for by someone you not only trust, but someone who can verify that the mortgage broker has the ability to get transactions closed in the timely manner required of today's real estate sales contract. Otherwise, you may end up working with a competent mortgage broker who has a great track record when it comes to refinancing, but can't keep up with the pace and common obstacles to getting a home financed in the context of a sale.
On top of that, sometimes the relationship can help you negotiate out of a couple of line item loan fees (if your particular mortgage rep has the power to get them down at all), if push comes to shove and cash is tight to close the deal. Assuming you are working with a real estate pro you really trust, working with a mortgage broker they trust can save you, rather than cost you, money.
Stage Three: House Hunting
Insider Secret: "Distressed" doesn't always equal "discounted" - in some cases, a "regular" sale can be a deeper deal.
Why: Short sales and foreclosures have grown to comprise roughly 30 percent of the homes sold on today's market, even higher in some areas. The average sale price of foreclosed homes was 32% lower than the average sale price of non-foreclosed homes, at last count. However, it's not always the case that foreclosed homes or short sales - homes which are being sold for less than what the seller owes on their mortgage(s) - offer the buyer a fabulous discount.
Mortgage servicers and asset managers who make decisions about distressed properties are on the hook to their investors to recoup as close as possible to the current fair market value of every home they sell. Some banks even have a general rule of rejecting offers more than 10 percent or so below the home's list price, preferring instead to reduce the price by that amount and put the home back on the open market to see if any new buyers are activated by the price reduction to make an offer better than the lowball offer that was initially put on the table. On short sales, the bank is trying to get as close as possible to recovering what the seller owes - and may or may not be concerned with what the fair market value of the home is. (Nine times out of ten, there will be a big gap between fair market value and the seller's outstanding mortgage balance. If there wasn't, the seller wouldn't need to do a short sale!)
With so many distressed properties and homes with depressed values on the market, in many areas, the individual, non-distressed home sellers who are putting their homes up for sale right now are those who are very motivated to sell. Further, they are more likely to be flexible with you on everything that is negotiable, from contingency and escrow periods, to price, to repairs and included items.
Also, individual sellers can be emotionally motivated to sell to move on with their lives, get into their bigger (or smaller) house, or move on to their next job; banks, on the other hand, aren't people (!), so lack that emotional sense of urgency to get the properties sold, no matter how urgently you may think they should be trying to get rid of the foreclosed properties they own. (If you've heard the old advice that banks don't want to be in the home-owning business, I can tell you this. That is true, in a very general sense, but now they are and will be - for a long time to come. They have no emotions, have no urgent need to sell or move, and are not willing to give houses away at pennies on the dollar to get out of it, no matter what those infomercial folks say.)
Long story short: you can sometimes negotiate a better deal with an individual seller on a "regular" sale than with a bank on a distressed home sale. So, don't limit your house hunt to foreclosures and short sales, if you're looking for a good deal on your home.
Stage Four: Negotiations
Insider Secret: Your family and friends can cause you to lose your dream home.
Why: With so much information on the web and the news every day about the recession and the buyer's market, everyone seems to be an armchair economist/real estate savant. But much of that news is national and based on medians, averages and trends. That is, it might not necessarily apply to every home on the market in every city, and more importantly, it might have nothing to do with "your" particular home.
When I was a little girl, my best friend's grandfather would very carefully hand each of us a quarter, always doling it out with the sage admonition: "Don't spend it all in one place." We'd always smile, look at each other, then go ask our Moms for ten bucks apiece. In the same vein, people who are not currently in the market for a home have no idea what an individual home should "go for." If you tell your parents, church pals, or colleagues at work the blow-by-blow details of your offer, counteroffers, etc., you should expect to hear things like, "Oh, you're paying way too much!", "I think you should push them down another $10K," or "You know, you're in a better bargaining position than that." And sometimes, taking that sort of advice will end up blowing your deal. Work with your trusty real estate broker or agent to develop a smart strategy - with their experience in your local market - about what price and terms to offer. Then keep working with them to manage and maintain realistic expectations as you proceed through negotiating the contract to buy your home.
Stage Five: Escrow, Inspections and Underwriting
Insider Secret: It's critical that you attend your home inspections.
Why: When it comes to inspections, many first-time buyers expect that a home will either pass or fail. Except in a few jurisdictions where the government imposes certain condition requirements for a home to be sold, the home inspection is more about educating you, the buyer, as to the details and nuances of the home's condition than about seeing if the place hits a particular target for "good" or "bad" condition.
Home inspectors don't just look for things that need fixing, they also look to understand the home's systems and features, as well as to point out areas that will require your ongoing maintenance, highlight emergency shutoffs and other need-to-knows, and indicating where you should have specialists further inspect items of concern. Many home inspectors create vivid, detailed electronic reports - some, complete with color photos. But that's not enough!
If you're physically onsite at the home during the inspections, the inspector can physically show you the shutoffs for water, gas and electric - and how to use them. They can also point out, in person, any things that need repair, and give you some tips for maintaining the place in tip-top shape. Also, in many states, the general home inspector is legally prohibited (vs. the pest, roof or other "specialty" inspectors) from issuing a written quote or bid for repairs, to avoid a conflict of interest where they'd try to fabricate flaws in the home to get the repair job. However, the repair costs are one of the most important things a smart buyer wants to know!
If you show up, many inspectors will give you a rough range it would cost you to do various repairs, or otherwise indicate to you whether the needed repairs are "big deal" or "$10 home improvement store" fixes; some will even give you a few references to contractors they trust.
All around, you'll get much more of the detailed information you need to know whether and how to move forward with the transaction if you should up in person to the home inspections, rather than just waiting for a copy of the report to come to your email.
Tuesday, February 1, 2011
Warren Buffets new comments on the Real Estate Market
Warren Buffett sees housing market bouncing back by 2011
Billionaire Warren Buffett said the U.S. will recover from the residential real estate slump by 2011 as demand for houses catches up with the supply that accumulated during the bubble.
"Within a year or so, residential housing problems should largely be behind us," Buffett wrote Saturday in his annual letter to the shareholders of his Berkshire Hathaway. "Prices will remain far below 'bubble' levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits. Indeed, many families that couldn't afford to buy an appropriate home a few years ago now find it well within their means."
Record foreclosures flooded a U.S. real estate market already glutted with unsold property, causing housing starts to fall.
"People thought it was good news a few years back when housing starts — the supply side of the picture — were running about 2 million annually," wrote Buffett, 79, chairman and CEO of Omaha-based Berkshire. "But household formations — the demand side — only amounted to about 1.2 million."
Buffett built Berkshire into a $198 billion company through takeovers and investments in companies he believes have lasting competitive advantages and superior management.
Berkshire, which has a real estate brokerage, a business that constructs prefabricated houses and units making products used in home building, has suffered in the downturn. Profit at carpet maker Shaw Industries fell 30% last year to $144 million.
He's very deeply invested in this, said Tom Russo, partner at Gardner Russo & Gardner, which holds Berkshire stock. Across his industrial companies, he's massively poised to gain from a housing recovery, Russo said.
Buffett wrote that his company should have bought more corporate and municipal bonds last year because they were cheap compared with U.S. Treasuries. When it's raining gold, reach for a bucket, not a thimble, he said.
Buffett has used past letters to discuss plans for his successor, praise Berkshire managers and confess his failings. Last year he said the U.S. economy was in shambles after reckless lending.
Buffett said this year that the CEOs and boards of companies that failed during the credit crisis shouldn't be able to pass blame to those below them. Boards should insist on CEOs taking responsibility for risk, he said.
Shareholders weren't the ones who botched the operations of some of the largest financial institutions, Buffett said, yet they have borne the burden, with 90% or more of their holdings wiped out in cases of failure.
Buffett agreed to his largest deal last year when he arranged the $27 billion takeover of railroad Burlington Northern Santa Fe. Berkshire completed the acquisition, which Buffett described as an all-in wager on the U.S. economy, on Feb. 12.
Shares of Berkshire traded at about $15 when Buffett took control in 1965. The class A stock closed yesterday at $119,800, its highest since October 2008. Buffett added class B shares in 1996, and agreed to split them this year to help pay Burlington Northern shareholders.
© 2010 Bloomberg L.P. All Rights Reserved
Friday, January 28, 2011
Negotiating on buying a house Tip #1
How much did the seller pay for the home that you’re considering?
This question, depending on the market, can help buyers negotiate a better deal – perhaps even get the seller to carry a portion of the financing.
Remember, the purchase price of a home is influence d by several factors, like current market value and improvements made to the home. The original purchase price may not have anything to do with the current value of the house, but it could play into the negotiations…
I have had situations in the past where sellers had a little room to maneuver on price, so it’s important to keep the original price in mind.
Just a thought
Thursday, January 27, 2011
How to stay "in the know" in our own neighborhoods
I wanted to share this recent article from Tara Nicholle at Trulia:
6 Reasons You Should Google Your Address
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