Real Estate Recession and Military Base Closures - The BRAC

By M Siddique 

Gudrun and Tcat have discussed the market cycles and in quite a few of our pieces, how down trends in the real estate market are spotty, and not uniform. We found what for some is a real crystal ball! It is called The BRAC. This rather large tome may help you figure out is your market experiencing or about to experience a real estate recession? It turns out many builders look at The BRAC to figure out where to build new construction.

Certainly, are quite a number of factors to consider before even coming up with a probably yes or probably no real estate recession in your market. There are no definitive this or that methods of prediction. It's not a matter of just "reading the tea leaves" either. If you happen to be in an area containing one of the thousands of military bases, "The BRAC" can be a major clue to real estate boom or real estate recession. In this short article we'll take a look at what's that means.

The BRAC is actually an acronym from the United States government. BRAC is short for "Base Realignment and Closure". This is a fancy term coming from the Department of Defense (DoD) which tells you in a high likelihood, what side of the coin you are going to be on. Let's give an example.

We have mentioned to you on several occasions that an area that is doing well is Huntsville, Alabama. So unless you're a student of history, have business in that area or live in that area, you probably have little to no idea where Huntsville is or why is it hopping?

Huntsville is in the middle of Alabama, featuring one of the older mountain ranges in the United States. Now granted. Gudrun knows more about the geography of Germany than I do. When we were touring Huntsville. I mention to her. My understanding is that Godard had picked hear to live and work, because it reminded him of the Black Forest in Europe.

She agreed that the rocky limestone mountains and vegetation in the forest was quite similar. Sidebar, for those of you who don't know Got hard. He was literally, a rocket scientist snapped up by the USA at the end of the second world war to work on missiles and space exploration. So what does all this have to do with The BRAC? Well it turns out, just about everything.

NASA has a complex it runs in Huntsville. Makes sense. They use rockets too. Redstone Arsenal for the United States Army, is there as well. So what does this all have to do with the BRAC, You may be repeating.

As the world and technology has changed, so has military requirements. The bottom-line is, the Department of Defense is consolidating bases. If you're not familiar in the reading of management speak (sometimes called Sanskrit) --- consolidating bases means were closing up a bunch of bases. As in: kaput, gone, closed, good-bye.

As many military families live off base, along with 100% of the civilian support personnel and contractors, a base closure is highly likely to cause a real estate recession in your area. So what's up with Huntsville? Well it turns out that the remaining duties from the bases and installations that are closed still have to have something happen somewhere.

In this case it means: Huntsville wins! So of course, finding even empty land to develop on in Huntsville is a daunting challenge to say the least. Naturally of course than existing housing prices are on a solid upswing. However. Before the entire state of Alabama begins to cheer, we would like to point out the other side of the coin for Alabama.

Page 35 of the 2005 BRAC, updated in April 2007. The first listing for Army, State of Alabama. Abbott USARC in Tuskegee, Alabama. It says: "estimated completion date for all closure or realignment actions: May 1 2010".

Think that might cause a bit of a downturn in housing prices for Tuskegee? Of course, this is not the only closure happening. However, some are a little bit luckier than others. Looking at page 40 of the BRAC we see:

Faith Wing USARC Anniston, AL is about to suffer the same fate however, careful study of this BRAC entry reveals that while the closure will be complete. 1 July 2011, FEMA Federal Emergency Management Agency - Department of Homeland Security will be stepping in with a "Anticipated Transfer Date" of 1 September 2011. So a recession hitting this city is far less likely.

All in all, the BRAC weighs in at 1835 pages.

Perhaps now you can see how many factors can go into a real estate boom or bust in United States. We want to thank, J.C. Newark, California for writing in and asking why can be so difficult to figure out why some markets are sinking, while others are swimming.

Come on! It's dark, stuffy and hot inside this little box of electronics. Not only that, we cannot hear you when you talk to us. Follow J.C.'s lead and send either of us an e-mail to tell us what topics you would like to hear about.

Siddique is real estate investor for over 22 years and President of http://www.butterflylister.com - Download Free How to sell your Home for Full Price in any market. feedback@ButterflyLister.com Article Source: http://EzineArticles.com/?expert=M_Siddique

What Real Estate Really Needs Right Now Is Some Certainty

By Carl Johnson

What we really need right now is some certainty. There are just too many question marks in the minds of buyers today. The housing market is down and no one is sure where the turnaround is, the stock market is lacking direction, interest rates are uncertain and people are worried about fuel prices. Unfortunately, the media does a very good job of highlighting bad news and reinforcing uncertainty.

Anyone who has read my report for a while knows that I am not one to spin the data. But I would like to take this month's report to look at the positive facts.

So lets look at what we know.

Unemployment in the state for the first quarter was at 3.7% and only slightly worse than last year (3.5%). Much better than our neighbor to the south, Massachusetts, at 5%. Employment has been fairly consistent over the past couple of years. Although the figures are nice to look at, I think at times it is better to consider how people feel about their job situation. Based on the people with whom I have spoken, I would say that not many are worried about their job. That's pretty positive.

To illustrate the strange effect we are seeing in this market where job security is high, we can look at what is happening with prices. The average price per square foot of a home sold was down 4% from last year yet the average selling price was down only 1% from a year ago. So it seems that as the prices of homes come down, people are buying more house. Perhaps it is a slightly larger home (The average size of a home sold in Q2 was 2,333 sf, the highest of any quarter since 2001!) or it has more features. The fact is, buyers are able to afford homes and show a willingness to spend the money to get what they want. Again, this would not happen in a poor economy!

We also know that the time that a sold home was on the market came down this month (128 days) and sold closer to its asking price (within 2.5%). Sellers seem to have adjusted to the real estate situation and have lowered their asking price. The homes that are well priced are selling.

I find it hard to look at this market and be pessimistic. True, we are clearly in a buyers market with a 9.6 month supply of homes. (a 6 month supply is considered balanced) But we had a very hot market up until late 2005. Though it was a lot of fun while it lasted we are only just getting back to a more realistic and, hopefully, sustainable market. Now if we could only get the news media to report more realistically I think we would be in much better shape.

Enjoy the rest of your summer!

Market Notables:

• Single family home sales in July were down 19% from July 2006.






• Single family home sales YTD through July of 2007 are down 8.6% from 2006.






• The number of homes placed under contract in July were up 10% from last month (unusual for the time of year) and up 12% from July 2006.






• The number of single family homes on the market was up 3.3% in June 2007 versus 2006. This further increases seller competition.






• The average price of homes sold in July was nearly unchanged (-1%) from a year ago at ~$388,000.






• The average price per square foot of a home sold in July is $169/sf . Down ~4% from a year ago.






• The number of days it took to sell a home that sold in July was 128 days. Unchanged from July 2006.

For complete reports delivered to you each month go to Homes and Land in NH with all the information you need to buy or sell you home. Article Source: http://EzineArticles.com/?expert=Carl_Johnson

Why Agents Need a Viable Website!

By Mack Perry

While many agents are finding times to be more stressful and earning a living in real estate has become more difficult, there are ways to succeed in today's marketplace. The most prominent way to succeed in today's environment is through a visible website. In the past, agents would have a website for the primary purpose of being able to state to a prospective client that they had one. The other agent's had a site, so in order to compete on a level playing field you had to have one also. Those days are gone.

Not only do you have to have a website but it had better be visible and be found on the search engines like Google, MSN, and Yahoo. The days of "my son knows how to build a site, so I'm going to let him do it" are also gone. To compete in today's marketplace, a viable real estate website must be optimized for the search engines. In doing this the key phrases that generate traffic to the site can be found. This is what generates the leads required to produce income so that agents can survive.

Search engine traffic to your site is "Type-In Traffic". What is meant by that? Simply stated, a visitor to your site typed a phrase into the search query of one of the search engines and the results page leads them to your site. There are a few important benefits to this kind of traffic. First off the visitor came to you. Should they elect to contact you, they contacted you! Remember the do-not-call list? If they contact you and you in turn follow up with them you have not violated the do-not-call list. Another benefit of the prospect contacting you would be that when you do your follow up it will not be considered spam. Heaven only knows how we have all come to despise spam. The final benefit that will be mentioned here deals with ROI. We are all business people that must be concerned with our return on investment. That's right, return on investment. By having a well optimized site, we as REALTORS can realize a decent return on our investment which in turn will reduce some of the stress associated with the environment we are doing business in.

This article was written by Mack Perry, an Atlanta, GA REALTOR. His website can be viewed at http://www.mackperryhomes.com Article Source: http://EzineArticles.com/?expert=Mack_Perry