Wednesday, October 31, 2007

Fed Lowers Interest Rate Again!

Well, the Fed has reduced the interest rate again:

From WBALTV.com:
"The Federal Reserve, confronted with surging oil prices and a slumping housing market, on Wednesday cut a key interest rate by a quarter-point, the second rate reduction this year.

"The central bank lowered the federal funds rate to 4.5 percent in an effort to stimulate economic activity and keep the country from dipping into a recession. The move will make it cheaper for consumers and businesses to borrow money."

Look for this to help out with mortgage rates! Keep your credit rating strong and you won't have any problems with loans in any case. I have a great list of excellent lenders. Email me or call for more information!

And as always, I would love to work with you or any of your friends and family who are thinking of moving!

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Tuesday, October 30, 2007

Letter from State Del. Warren Miller

Here is - in it's entirety - a letter from my State Delegate, Warren Miller. I've spent many hours recently calling elected officials to let them know I don't want Gov. O'Malley's tax plan to go through. I hope you will do the same.

Once again I need help connecting the dots to make sense of the new O'Malley tax plan. Having looked at this piecemeal proposal several times, many things just don't make good sense. Before I get into the questions, I must commend the administration for orchestrating this whole traveling road show with laser precision. First the Governor endears himself to the community over a casual kitchen table conversation with an average Joe family. Then he proceeds to the rural areas of the state, styling himself as the hero of the Maryland agricultural community. Both were brilliant marketing moves in my opinion.

But now the message revolves around "doomsday". How do we go from the kitchen table or the cornfield to doomsday? Well, with Governor O'Malley the path is simple. If the General Assembly doesn't pass his tax increase bills, then we will spiral downward and never see daylight again. He has finally stooped to an all time low and unfortunately, I wish I could believe that he will not outdo himself in the future. He is resorting to tactics of terror, similar to the work of those who choose to push their agenda by taking our citizens hostage and sending us pictures of them in compromising positions. O'Malley has become a terrorist of sorts. He is sending his message of fright to college students and single moms without regard for them at all. He paints pictures of people being thrown out into the streets due to program cuts and college students leaving college prematurely due to a lack of state funding. Fear is not the motivator that caused this country to rise to the top of the food chain. Fear paralyzes people, families and economies. This paralysis is just the formula for government intervention (another word for interference) in your daily life. If you can't function without their help, then you will do anything to preserve them, including paying tax rates that would make a loan shark blush.

Now time to connect the dots. The proposed tobacco tax is said to be two-fold; first, it will fund some health care projects and bail out some hospitals from bad debt. (By the way, most of this debt is caused by illegal immigrants using the emergency room as their primary care facility.) And secondly, this tax is supposed to act as a deterrent and reduce the number of smokers in Maryland. Trust me when I tell you that I do not support smoking or tobacco use. It is a proven killer, however, it is a legal activity and those who participate in it do it willingly. The addictive chemical make up of cigarettes causes the user to become a slave to the chemical and many users would like to quit but they simply can't. So this tax will possibly be the straw that breaks the camel's back and they will quit. I certainly hope something short of cancer causes them to stop. Nevertheless, the main health benefit to this new tax is that many people will quit smoking.

With that said, let's look at another facet of this new tax plan. My health club membership is now going to be taxed. I am not sure why. I see empirical evidence proving that good health is achieved through physical exercise and healthy people cost less to care for overall. So here is my dilemma: If I buy into the notion that the tobacco tax will cause many smokers to become non-smokers (a good thing), what can I expect to happen to the health club members following the same logic? If health club members stop going to the health clubs and they become obese or unhealthy, what fiscal impact can be expected?

The bare bones truth is simple: this is not about health; it is about wealth. Yes, Governor O'Malley wants to play Robin Hood and take from the hard-working and give more to the hardly working. He also wants to make sure that the government continues to grow and gain market share in the affairs of your life. Remember, the goal is for big government to become invaluable to you so that you will gladly pay for them to stay around to help. It has been said over and over, but it bears repeating. We do not have a revenue problem, we have a spending problem. Containing costs has not been considered, nor will it be. The only time we hear about containing costs is in reference to single moms losing job training or college students leaving school to work at McDonalds because they could not afford college tuition. And that brings me to my final dot that needs to be connected.

Last year the Governor (yes, this same Martin O'Malley) wanted to give illegal immigrants tuition breaks amounting to about $14,000 per year per student. This ill-fated plan would have cost Marylanders untold millions of dollars. He made the arguments ranging from "we owe it to ourselves to have an educated illegal population" to "an education will keep them from stealing from us in the long run". Now I hear Governor O'Malley stating that if we do not pass this budget, all the state schools will loose millions of dollars and students will go without, or tuition will be raised to ungodly levels. How much worse would it have been if his plan had not been stopped last year? I think that makes little to no sense, but then again, that's par for this course.

I simply don't believe the Governor has a plan. He is piecing together a tapestry one square at a time and hoping he covers all his bases. Unfortunately, this tapestry is just the wet blanket our state's economy needs to put out the fire caused by several years of strong growth. Thanks Governor O'Malley.

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Monday, October 29, 2007

It's Still A Great Time to Buy A Home

Here in Maryland, the market has slowed down from what we saw a couple of years ago. That's not to say that it's a bad time to buy a home, though. In fact, 2007 has proven to be a good time to be a buyer! Sellers are offering concessions to buyers so they can get moving and interest rates are still some of the best we have seen in the past several years.

According to Yahoo.com's article of Oct 25th, "Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages fell to 6.33 percent this week, down from 6.40 percent last week. It was the lowest level since 30-year mortgages dipped to 6.31 percent on Sept. 13, which had been the lowest point since last May."

6.33 percent is an awesome rate for a 30 year fixed mortgage!

From the September 2007 statistics from Howard County Association of Realtors, of which I am on the Board of Directors, 2007 has brought 1658 active listings, a 13.3% increase over 2006's 1464 active listings, and a 13.3% decrease in the number of houses under contract (2239 in 2007 as compared to 2006's 2582.) Settlements are the telling number, however, 2007 has had 2214 year-to-date compared to September 2006's 2531, down by 12.5%.

What does that mean for a consumer? It means that there are more listings to choose from and better deals to be had because less homes are selling than last year!

The other thing to remember is that over 34% of the homes that have sold this year are in the $300,000-$399,999 range and another 18.9% in the $400,000 to $499,999 section. In looking at the $300-$399,999 range actives just now I found 2 bedroom condos in Clarksville and 3 bedroom ranchers or split levels in Columbia and there are 477 active listings in that price range. The largest home in that price range was a 1930 single family home in Marriottsville with 6 bedrooms and 2 baths on nearly 1/2 acre. There are plenty of great deals out there.

The last figure I'm going to give you is the average sales price - the 2006 average sales price was $494,941 - average for 2007 has not gone down, it's $499,731. It just hasn't taken the huge yearly jumps we've been seeing for the past few years. Because of our location between Baltimore and Washington DC, I believe that we are not going to see the widespread losses on house values that some parts of the U.S. have seen. Buying a house here today is not as scary as it would be in some areas.

Because about 70% of my business is done in Howard County, I've posted those figures but if you'd like information about other areas in the Baltimore-Washington DC area, just ask - I'll be happy to look up the information for you.

As always, Judi Stull & Associates - and me especially - value your business. We want you to be happy with our service and the work we do for you so you will refer us to your friends and family who are looking for homes. They don't even need to live in Maryland - we can find them a great Realtor anywhere in the world. It doesn't matter if you are moving to Egypt or Australia or California, I know great Realtors all over the world and will be happy to refer you to them.

Have an awesome week!
Judi

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