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Amandas Monday Morning Coffee 1-17-2011

Happy MLK Monday Morning!

Did you get enough snow last week? No one was safe from the white stuff according to the Weather Channel.  Florida was the only state in the union that didn’t see snow last week! (However, I believe they were mistaken.  I have family in Jacksonville who said it snowed there!)  Even Hawaii had seven inches on Mauna Kea, the state’s highest point!
Those of us here in Huntsville sure did have fun though!  I know we had 10” out by my house in NE Hsv, you should have seen the kids jumping in snow on the trampoline (with the screen guard around it).  It was hilarious!  Alan, one of my Listing partners has pictures of him SKIING down Bob Wallace!  What a hoot!  It was fun for a day or two, but boy were we all glad to get back to the office!


We have had a phenomenal first two weeks of January, and it has helped set our high expectations for 2011!   We closed out 2010 with it being OUR FIRST FULL YEAR in business!  We celebrate February as our anniversary since that’s when we had our Grand Opening, but we made our move during the Christmas Holiday to get into this awesome building!  So after all numbers are tallied, of course, expenses were up- this was after all, our first year and if you stopped by to see our office, you know we spared no expense. We provided top of the line furniture, desks, computers, art work, and signage for our company, agents, and friends.  So although expenses were up, we closed out the year with our sales being 25% over last year’s sales!  We are all so excited and thrilled with that headline. Our first year!


Thank you for supporting us, and referring us to your friends and family!  It means so much to us that you helped us have a successful first year!  Let’s not stop here!  Please keep us in mind as we want to nearly double our business through 2011, and we can’t do it without your help!  Continue to support local small businesses.  We all appreciate it!





*Read more below for other exciting news updates*


Real Estate Tax Extension –really makes no waves of affect

The law enacted by President Obama three weeks ago to extend the tax cuts of President George W. Bush includes a number of provisions of importance to real estate, but it also leaves out at least one provision NAR (National Association of REALTORS) opposes. In short, it’s largely a continuation of the status quo for the near future. The one potential drawback is in its cost.


Since it’s not paid for with any program cuts, it stands to put upward pressure on interest rates in the future and could lead to more pressure on lawmakers to find ways to cut the federal deficit, which in turn could make tempting targets out of the mortgage interest deduction and other programs through which the federal government has historically shown its support of home ownership.


On the plus side, the law leaves out a proposal that’s been talked about for close to two years now, and that’s to tax as ordinary income rather than as capital gains the carried interest of general partners in investment partnerships. That proposal, which is targeted at hedge fund managers, would hurt real estate investment partnerships disproportionately, because the vast majority of investment partnerships are for real estate, and NAR has opposed it. So, that issue is neutralized for now.


In general, the law keeps in place existing tax brackets (which go from 10 percent on the low side to 35 percent on the high side) and the existing capital gains rate, which will remain at 15 percent. Depreciation recapture tax rates remain at 25 percent. No new limitations are created for Section 1031 like-kind exchanges. And the existing 15-year cost recovery period for leasehold improvements is retained. Same with existing bonus depreciation treatment: assets with a cost recovery period of 20 years or less are eligible for 100 percent depreciation in the year the assets are placed in service. This rule applies to all assets placed in service on or after Sept. 8, 2010, and before January 1, 2012. Eligible assets placed in service during 2010 will qualify for a 50 percent bonus depreciation allowance.


You can get more details on these provisions in an initial analysis by NAR Government Affairs on


Other provisions of note:

  • A one-year payroll/self-employment tax holiday (slightly lower tax rates for the 2011 tax year)
  • A return to estate tax rules as of Jan. 1, 2010, with an exclusion of $5 million ($10 million for a couple) and a maximum rate of 35 percent
  • Extension of the alternative minimum tax (AMT) “patch”—that is, exemptions for middle-income households that would otherwise be at risk of getting hit with AMT
  • Tax credits for new-home builders for homes that meet energy efficiency standards and for manufacturers of energy efficient appliances.
  • There are also tax credits for existing home owners who make energy efficiency upgradesThere’s also an extension of the mortgage insurance (MI) deduction, which phases out for individuals whose annual income is between $100,000 and $110,000

Read the full analysis on


Disclaimer: This is just a summary of some complex provisions. You would want to consult with your accountant or tax adviser on these or any other tax issues that affect you.


Source: REALTOR® Magazine




9 Staging Tips to Sell Your Home Quickly
Surveys show that staging pays off and often helps to sell a home fast. But you don’t have to spend thousands to make a big impact. Put your home center stage with these thrifty tips from Lowe’s:

1. First Impressions Count. Roll out the red carpet for potential home buyers by sprucing up your entryways, especially the one on a lockbox. Welcome mats, planters filled with seasonal flowers, and clutter-free foyers and hallways set the stage.

2. Sell the Space, Not Your Stuff. Remember that the goal of a successful showing is to make a prospect feel at home – like it’s theirs, not yours. Put away your extensive personal collections. Less is more: open up your space so prospects can actually see what they’re buying.

3. Paint and Elbow Grease Work Wonders. Fresh paint and a thorough cleaning will give you the greatest “bang for your buck.” Remember that neutral walls are your best bet when staging a home for sale. Lowe’s has all the right shades to make your home more inviting. Get started with Lowe’s online Paint Visualizer. *Amanda’s note: If you need suggestions also ask us! Keep trim clean and bright, and walls neutral.*

4. Go with the Flow. Arrange furniture for easy traffic flow. Consider placing a major piece of furniture at an angle, such as a couch or desk. Angles add interest and can create a more open feel.

5. See the Light. Move lamps to dark corners and arrange window treatments so that natural light floods your rooms. Brighter is better, and your rooms will look larger. Visit Lowe’s extensive lighting section for the latest in fashionable, functional lighting. *Amanda’s note: Clean the light bulbs (yes I said clean them!) As well as clean the votive or glass globes, run them through the dishwasher for shine. Also NEVER use fluorescent or energy saving bulbs while selling your home.  Potential buyers do not stand in your living room waiting for the bulb to hit full brightness, we need that baby snapping on, light and bright immediately!*

6. Go Green. Live plants can add decorative flair, without spending a bundle. Plants and cut flowers have a way of warming up a room.

7. Don’t Forget the Outdoors. If you have a porch, deck or patio, clean the furniture and replace worn cushions. Give your deck a fresh finish with a new stain and seal.

8. Make the Kitchen Sparkle. Declutter the countertops by removing toasters, food processors, and other non-decorative items. If you have a breakfast table or counter, put out a couple of table settings complete with place mats, napkins, and dinnerware.  *Amanda’s note: but not too much! I recommend 2- 4 place settings and a small middle arrangement (if any) if you choose the place settings.  We have seen this way too over-done here lately.*

9. Warm Up an Empty Home. If your home is vacant, consider renting furniture for key rooms, but don’t go overboard. Ask your real estate professional for advice, based on your home’s unique features and selling points.

Market Update

In reviewing my numbers (below) which I sent out before the local Board of REALTORS (HAAR) sent theirs to the Times, I’ve found several discrepancies that I’d like to review this week for our market review.  We’ll keep in mind that the full December report will be released on January 20th as they are each month.


Stacked below you will find both two articles.  The first is from the Huntsville Times and second is mine from two weeks ago.  Here are my thoughts on each:


Right from the start we see a difference in home sales for 2010.  That is due to the fact that I have included all the locations where we either serve clients or those who read my newsletter and have requested their areas be added to our numbers. Therefore, in my breakdown of “sold by area” you will see I also included DeKalb and Limestone counties, as well as, Arab and Scottsboro which is not always in the HAAR running stats.  Now, I also reference HAAR’s stats quite often, as they are always consistent each month using the same method; however, for this annual report I really felt we all would like to see how the entire Tennessee Valley has been affected.


Now a very interesting fact I did not know, (and still don’t understand where this variable number comes from) was that we can factor a 4.5% decrease in adjustments to the total of sales due to the tax credit variable that ended mid-2010.  Again, I do not understand how you can count this as a variable as there are always variables; however, to hold true to compare numbers in the same method as the board portrayed to the Times would mean that the difference in home sales [to include all our surrounding areas mentioned below in my report] would change from the 9.5% decrease to a 5% decrease in overall sales numbers going from 6,029 in 2009 to 5,461 in 2010.  Overall (including, yes, some slower market cities) our entire area went up in median price by 1.6%.  I feel that’s fantastic as long as we keep seeing that rise.  When you look at individual cities that matter to us individually, but pulling together the Tennessee Valley as a whole, it shows our stability.

Certainly job stability directly relates to housing recovery.  Nationally jobs are still a hot topic; however, in our area we see more and more companies opening.  Keep in mind every time a home sells, that is a significant driving force in our local economy.  Think about this.  We are a nation of homeowners, 67% of American households are owner-occupied.  Housing accounts for 15% of our Gross Domestic Product in general.  Research has shown that for every home purchased, $60,000 is thrust back into our economy for furniture, home improvements, and other related items. Plus, homeowners pay 80-90% of individual federal income taxes contributing to federal programs that benefit all Americans.


Yet many recent media reports question the value of homeownership and whether it is worthy of the tax benefits currently available. Some reports contend that changing federal policies and eliminating tax incentives that support homeownership, such as the Mortgage Interest Deduction (MID), might even be in the public’s best interest.  This is simply NOT TRUE.  I believe the MID is vital to the stability of our housing market and economy.  Changes to the MID could possibly lead to a decrease in home prices just when the national housing market is seeing stabi8lity.  Economists at NAR estimate that changes to the MID could erode home prices as much as 15% if put into law.  This is why I am in agreement with many other Realtors and homeowners.  We’re watching politics are encouraging our lawmakers to defend the MID from any cuts or reductions.


Obviously I went off on a tangent there, but it shows how much our economy and housing market is affected by so many elements.  I am posting a very short excerpt from of an article I found and agree whole heartedly with regarding “Why Homeownership Matters”.


Why Homeownership Matters

Homeownership has a significant, positive impact on net worth, educational achievement, civic participation and overall quality of life. Owning a home is one of the best ways to build long-term wealth.  In the past 12 years, a typical homeowner’s net worth has been 31-46 times that of a renter.  Plus, most homeowners enjoy stable housing costs.  In fact, studies show that fixed rate mortgage payments typically stay the same while rent has increased at an average rate of approximately 3% per year in the last 10 years.


NAR contends that homeowners contribute more to their communities by voting and volunteering more.  They do not move as frequently as renters, bringing stability to neighborhoods, which helps reduce crime and support upkeep.


It has been shown that homeowners enjoy a better quality of life. They tend to be happier and healthier, and feel a greater sense of control over their lives. They are free to redecorate, renovate and modify their homes as they wish.  Their children tend to do better in school and stay in school longer according to a recent white paper by NAR titled “The Social Benefits of Home Ownership.”


Now in regards to what I foresee for 2011.  I have read quite a bit of esteemed economists articles and blogs of forecasts. I see bearing held in most, but I have to agree on this side of the fence.  I predict that the mortgage requirements will relax over the next 6 months (most can agree they were too loose before and are too tight now). The housing market is currently showing strong signs of improving.  I feel we will not see a decrease this year.  In fact, I feel it will continue in an upward momentum through 2011.

Now, do I foresee an increase in a particular quarter?  Well, saying the last quarter is an easy call; however, I have personally seen our call logs double just in these first two weeks of January as compared to last year.  I also know for a fact we have already set calendar dates for military, engineers, and doctors for June.  Yes June!  They are setting dates NOW to make their decisions on a home.  With the flurry of activity and buzz within our office I am anticipating an outstanding Spring.  We are currently on task to triple January 2010’s closing numbers within our office.  If I have an outstanding Spring that means our economy is having an outstanding Spring (as mentioned above on how much revenue homes sales bring to our over-all economy).
-Amanda Howard


Huntsville Times article:

HUNTSVILLE, Al. – Jan. 09, 2011  The numbers for 2010 are in: 4,381 homes were sold here last year, according to statistics from the Huntsville Area Association of Realtors.


That’s an 8.52 percent decrease from 2009. But it’s a 4 percent decrease when adjusted for the tax credit variable.


The good news: At, $175,421, the single-family home median price – the figure at which half of the homes sold for more and half sold for less – increased by 4.22 percent from 2009.


It’s also a 1.56 percent increase from 2008.


“Until you see job recovery, you won’t see housing recovery at an astounding rate,” said Oscar Gonzales, the CEO of the Huntsville Area Association of Realtors. “That’s one of the underlying things that will lead to recovery.”


The Huntsville-Madison County Builders Association says new construction permits were down about 8 to 10 percent in 2010.


“That was expected due to tighter banking regulation and general fear of the buyer because of general economic news that was out there every day,” said Tony Antonios, owner of Medallion Builders and president of the Huntsville-Madison County Builders Association.


But, he said, new homes sales accounted for 38 percent of all homes sold in 2010.


“2010 was not as good as we would have liked to have seen,” Antonios said. “But we feel it has bottomed out and things are turning around, and it’s going to get better.”


So what’s the outlook for 2011?


Antonios and Gonzales say they’re “cautiously optimistic,” believing the economy will rebound soon.


But, as Gonzales put it, there are “so many uncertainties.”


Among them: a Labor Department report Friday morning that said 103,000 jobs were added in December, falling short of most expectations.


National unemployment, though, fell to 9.4 percent, its lowest level since May 2009.


“I don’t know if we’ll see a real drastic change in 2011,” Gonzales said. “If there’s an increase, it’ll be in the fourth quarter of 2011.”


Antonios cites Madison County’s lower unemployment rates – just more than 7 percent, third-lowest in Alabama in November – as one of the reasons for builders to be encouraged.


More reasons: low mortgage rates and a declining inventory of new homes.


“Any new people moving to Madison County will gobble up new homes, and we are already at a low inventory of new homes,” Antonios said. “Those people moving in are going to need new homes.


“We are looking for a very good year because of those signs.”



Amanda’s National review:

Nationally we are hearing that the US housing is likely to continue lagging broader recovery into 2012, with sluggish sales and slowly stabilizing prices. The US economist at Capital Economics, Paul Dales, is predicting that US sales are going to be slow for another two years as the market struggles to recover in 2011.


Real Estate sales fell nearly 5% in November from the previous month and are now 26% lower than a year earlier, according to the most recent National housing report.

The real estate market is struggling to find secure footing after the end of the homebuyer tax credit program earlier this year.

While home sales usually decline in winter months, we are seeing a larger than normal correction this winter due to several artificial factors such as the expired tax credit.  However, there was much national chatter regarding falling home prices, though they appear to remain stable with several markets reporting significant price increases over this past year.

A monthly survey that covers 54 metropolitan areas, showed that none of the areas reported an increase in November sales from the year earlier. The top five markets that experienced a sales gain last month from October include Jackson, Mississippi and Billings, Montana both with a 9.2% increase, Las Vegas up 4.7%, Birmingham, Alabama up 3.8%; and Miami up 3.6%.

The report also shows that housing starts rose for the first time in a few months in November climbing 3.9% from the previous month, though building permits for new home construction fell to the lowest point in a year and a half, according to the Commerce Department.

November saw a surprising increase in housing starts but low building permits indicate a dismal outlook. See the following article from Property Wire for more on this.


Starts rose to a seasonally adjusted rate of 555,000 units, up from a revised 534,000 units for October but still 5.8% lower than a year earlier. While permits for new construction, a leading indicator of future building activity, decreased to 530,000 in November, which is 4% lower than the revised October figure of 552,000 and 14.7% below the year ago estimate of 621,000.


Amanda’s Local review:

Locally, here are the statistics I have gathered to start our review of 2010.


We have seen a steady decline since 2008 of the number of homes selling in North Alabama; however the Median price took a dip from 2008 in 2009, but has boosted back up to being almost level in 2010. We observe that the days on market have risen slightly year after year the past three of our review, but not so much as to make any major effects on families; however, the inventory has risen significantly since 2009.


In reviewing the areas selling by area, we see that when comparing exact dates and areas from 2010 vs. 2009 it is noted that though we have had a decrease in the number of homes moved, our over-all values have slightly moved up.  Only a few local market areas had a decline which was noticed in Madison outside city, Madison County NW, Madison County SW, Madison County SE, DeKalb County, Limestone County, and Arab city.









Past Month reminder of Real Estate Milestones in November 2010

Homes sales increased by 14.24 percent compared to October 2010 and slipped by 32.89 percent compared to November 2009.


At $167,850 the November 2010 single-family home median price fell by 4.09 percent from October 2010 and decreased 0.09 percent from November 2009.


The number of available properties (active listings) in November decreased by 2.89 percent compared to October 2010 and rose 15.08 percent compared to November 2009.


The November 2010 Average Days on Market (DOM) increased by 4 days to 93 compared to October 89 days and increased by 5 days from November 2009


The information published and disseminated to the North Alabama Multiple Listing Service (NALMLS) is communicated verbatim, without change as filed by MLS participants. The MLS does not verify the information provided and disclaims any responsibility for its accuracy. All data is preliminary and subject to change. Monthly sales figures reported include a statistical estimation to account for late entries. Twelve-month totals may vary from actual end-of-year figures.