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The death of the mortgage broker? | Waccabuc Realtor

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Starting next year, mortgage brokers, who serve as middlemen between homebuyers and lenders, will be subject to new rules that experts say could push many to leave the business. Issued by the Consumer Financial Protection Bureau last week, the new rules prohibit brokers from raking in more compensation in exchange for placing borrowers in more expensive mortgages; they also disallow brokers from getting paid by both the borrower and the lender on a mortgage transaction. While the rules will make working with a broker safer for consumers, experts say they may also leave them with fewer brokers to choose from. “It certainly does put some of the more marginal players on the fence,” says Keith Gumbinger, a vice president at mortgage-info website HSH.com.

For borrowers, this unintended consequence may make shopping for a mortgage more difficult. Brokers tend to have access to a large number of lenders and are able to quickly determine the best loans and rates available. Without brokers, mortgage applicants have to contact banks themselves, going from institution to institution until they have a list of mortgage products and rates they qualify for. They can also search mortgage-shopping sites, but many of those sites only provide referrals, without giving consumers enough information to comparison shop.

Of course, there have also been plenty of risks to working with brokers as well. Critics contend that brokers were among the main causes of the housing crash, putting borrowers into risky mortgages that they couldn’t afford because they had a financial incentive to do so—a big reason why the new rules were created.

But now that a lot of the shadier brokers have left the field and the new rules wipe away much of the risk to working with the brokers who remain, the bigger challenge for consumers will likely be finding a broker who can give them access to many lenders. Over the past few years several large banks, including Wells Fargo and Bank of America, have announced they’re no longer working with independent mortgage brokers. (Some of those banks have said that mortgages originated by their own loan officers performed better while others have cited difficulty in controlling negotiations between independent brokers and clients.)

The decline of mortgage brokers has been underway for several years. That’s been largely due to the real-estate downturn that pushed many of them out of the market and earlier regulations for the industry that made it costlier to be a broker. The National Association of Mortgage Brokers currently has roughly 5,000 members, down from 25,000 in 2006, says Don Frommeyer, president of the association. Experts say the disappearing broker has made things harder for mortgage applicants. “Consumers are already having a difficult time getting a mortgage,” says Brad Hunter, chief economist at Metrostudy, a housing market research and consulting firm. And if the number of brokers does decline further, he adds, “that could have an impact, making it more challenging for borrowers to get loans.”

Mortgage brokers’ share of home loans has also dropped as their numbers have declined. During the last two years, mortgage brokers accounted for about 10% of total mortgage originations, compared to 20% in 2008 and more than 30% from 2004 through 2006, according to Inside Mortgage Finance, a trade publication.

Opinion: Obama’s mortgage freebies

Basil Petrou on the Consumer Financial Protection Bureau’s new mortgage rules and how the feds control nearly every corner of the housing market. Photo: Associated Press

Those figures could decline further due partly to the rising costs that accompany the new rules and declining profits, says Mark Goldman, senior loan officer with C2 Financial Corp., a San Diego-based mortgage brokerage firm. New players are also unlikely to emerge. “They’ve raised the barriers of entry into mortgage brokerage,” he says.

Going forward, borrowers who use brokers will soon have more protections than in the past. It’s less likely that they’ll be steered into a mortgage with a higher interest rate or fees or one that charges a penalty for paying it off in advance. Also, brokers won’t be able to make more money by sending a client to buy title insurance from an affiliate.

Those who have difficulty finding a broker should consider checking out LendingTree.com, which finds lenders within its network that will consider your loan based on your personal information. Separately, consumers who have a relationship with a bank—whether it’s a deposit or brokerage account or wealth management ties—should consider asking the institution if it offers any discounts on rates, closing costs or other mortgage fees.

For their part, most mortgage brokers who are still around say they’ve already implemented most of the new compensation rules, which were initially announced in the Dodd-Frank Wall Street Reform and Consumer Protection Act that was signed into law in 2010 and a Federal Reserve compensation rule that kicked in the following year. (The CFPB’s announcement finalizes those regulations.) Brokers who haven’t done so yet will need to change their practices over the next year to comply with the new rules.  

 

 

via marketwatch.com

 

Luxury Sellers Hang Tough on Prices | Waccabuc Real Estate

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Even though the time it takes to sell a luxury property has increased to as long as 260 days in Chicago, 287 in Miami and 197 nationally, fewer sellers are cutting prices.

Wintertime sluggishness has slowed luxury markets across the nation. Days on market have been increasing in nearly every major market tracked by the Institute for Luxury Home Marketing, and inventories are at a seasonal low, down from 27,600 properties in June to 18,400 in January.

Rather than falling with the end of the summer buying season, low inventories have placed upward pressure on prices, which have risen from a median of 1.11 million in September to 1.23 in January, according to ILHM data.

Perhaps as a result of strong prices, sellers are not responding as they normally do in the winter by cutting prices to generate interest among buyers. In fact, fewer are reducing prices today than when days on market were lower last summer.

The percentage of homes on the market that have lowered their asking price at least once over the past 90-day period has fallen 10 percentage points since the end of the summer, from 31.4 percent of properties to 24.4 percent. This statistic illustrates how many listed properties may be behind the “price curve” – listed at a price above what the market is willing to pay for similar properties. Even in strong seller’s markets, the percent price decreased will be 10-12 percent, so some repricing of individual properties is common in any market. In weaker markets, this value begins rise into the teens, 20 percent, 30 percent, and higher. Percent price decreased is an insightful gauge of demand levels in the residential housing market.

The National Association of Realtors reported that sales of luxury homes spiked in the final months of 2012 as high-end homeowners rushed to take advantage of lower tax rates before January 1.

Many sellers wanted to cash in on their homes before a widely expected capital gains hike — to 20 percent from 15 percent — that was part of the fiscal cliff budget deal. According to the National Association of Realtors (NAR), sales of homes valued at $1 million or more spiked 51% in November compared with a year earlier.

via realestateeconomywatch.com

Good and bad news for multifamily housing | Waccabuc Realtor

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“At a 4 percent cap rate, all you need is rates to bounce by 100 basis points and you are going to wipe out an investor’s equity”
–Matt Galligan, CIT Real Estate Finance

Of the top 180 metros in the country, 44 doubled the amount of multifamily construction in 2012, according to a study by John Burns Real Estate Consulting that was released toward the end of last year.

To quote the study, “Among the major markets, the growth is staggering.”

I checked in with Lesley Deutch, a John Burns vice president, who worked on the report.

One has to look closely at the data, Deutch said, because smaller markets are included and, on a percentage growth basis, they can distort the picture.

For example, Bend, Ore., saw only two multifamily permits in 2011, but issued 120 in 2012, so the percentage of growth looks astronomical. The same would be for cities such as Huntsville, Ala., Pensacola, Fla., and Prescott, Ariz., all of which had fewer than 30 permits in 2011, but more than 100 in 2012.

This isn’t to say some larger markets weren’t showing extraordinary growth.

Durham, N.C., saw multifamily permits increase more than 400 percent in 2012 compared to 2011; West Palm Beach, Fla., close to 250 percent; and such cities as Charlotte, N.C., Jacksonville, Fla., Austin, Texas, Fort Lauderdale, Fla., Fort Worth, Texas, Raleigh-Carey, N.C., Atlanta, Ga., and San Jose, Calif., more than 100 percent.

In terms of number of permits issued in 2012, Austin and Atlanta led the pack, issuing almost 5,000 permits in 2012; and then came Charlotte and San Jose at about 4,200 units.

“In certain markets, we are seeing more multifamily construction than single-family construction,” Deutch said. New York leads that group, but there is always more multifamily than single-family built in New York. Nevertheless, this list is a long one, including such markets as Los Angeles, Dallas, Seattle, Miami, Denver, Chicago, Columbus, Baltimore, Daytona Beach and Newark-Union, N.J.

One of the big reasons for the growth, Deutch said, “is that banks are starting to loan again to multifamily. There is a lot of private equity out there because lenders realize how strong the sector is. The banks were a little nervous at first, but they opened up their lending windows for multifamily.”

Despite all the construction, “rents are still going up,” which is a positive signal for lenders, Deutch said.

With good times abounding, one would think the multifamily lending market would all be on the same wagon, but that’s not the case.

At the end of 2012, the National Multi Housing Council and National Apartment Association issued a white paper outlining key principles to stabilize financing for the multifamily sector.

The white paper makes a number of key points: the industry supports a return to a system dominated by private capital; private capital-only finance distorts the market because it mostly plays in the high-end side of top-tier markets; and Fannie Mae and Freddie Mac even out the market.

One of those private lenders in multifamily is CIT Group Inc. of New York, and Matt Galligan, group head of CIT Real Estate Finance, said his company expects to do $150 million in lending to the multifamily market in 2013.

Although CIT Real Estate does new-construction financing, Galligan has been focusing more on refinancing B-quality apartments with experienced developer/owners that are trying to upgrade to A.

“We like the fact that these apartments might trade at a 6 percent or 7 percent cap rate (capitalization rate, or rate of return on an investment property based on expected income property will generate),” Galligan said.

To which he added, “If you are going to be building new units, those are going to be Class-A; and that is where the competition is, and cap rates are at 4 percent,” which is a small return that could be endangered if mortgage rates rise even a small amount, say, 100 basis points.

Despite private equity back in the multifamily lending game, to some extent Fannie and Freddie have been the dominant players, setting mortgage rates low.

Galligan doesn’t trust the two GSEs, and believes they should not be in the multifamily market.

“They are subsidizing the multifamily lending business, causing all sorts of wildness. People are flooding the market because of below-market rates.” Galligan said. “Either do something with the GSEs or crank rates up by 200 basis points. If these things are being underwritten at a 4 percent cap rate, you now have yields at 2 percent. Then all you need is a little bit of vacancy or a decrease in reserves and you have problems.”

When I told Galligan about the John Burns numbers, he was more concerned than thrilled.

“Fourty-four markets? Let’s make the assumption there are 12 primary markets in the country, that leaves 32 other markets with a lot of new construction,” he said. “You are probably going to need $1,200 to $1,500 a month in rent to make new construction work, which is harder to get to in secondary cities. And there’s competition in those cities already. Maybe your product steals market share, but it is going to force a glut.”

He added, “At a 4 percent cap rate, all you need is rates to bounce by 100 basis points and you are going to wipe out an investor’s equity. That’s been our concern.”

via inman.com

3 Core Link Baiting Strategies for 2013 | Waccabuc Real Estate

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The search engines are always changing, but link baiting strategies never die. Here are the three core elements of an effective link bait campaign, which will only be more vital in the year ahead:

1. Understand Shareability

strategies SEOA link is, fundamentally, really just a social share from somebody who happens to run a website. While the platform (HTML) is different, the psychological forces in play are the same. Content that goes viral on social networks will tend to attract links as well.

And, if you pay attention to social networks, you’ll notice that there are definite patterns. Most viral content has at least one of the following attributes:

It’s opinionated

The popularity of conspiracy theories on the Internet is perhaps one of the best examples of how bold opinions attract attention and propagate rapidly. A strong stance can alienate you from a large portion of your potential audience, but it can also expand your existing reach and strengthen your following. It’s probably best to stick to values you actually believe in, of course, to avoid a PR disaster at some point down the road.

It’s funny

The humor site Cracked currently has over 2.3 million Facebook likes and a Domain Authority of 88. They have accomplished this simply by collecting interesting facts and making them hilarious.

It’s insider information

The Wall Street Journal linked to WordStream, an online ad-consulting firm, because they published their own proprietary data about Google. The original source of new information tends to attract more links than the site that re-purposes it, unless they are extremely good at re-purposing content, or already have a larger following.

It’s cute

Cats rule the internet, and according to this article on the science of Internet cats, this is largely because they’re cute and vulnerable. Cute pictures and videos of babies and dogs also abound on the Web. There’s something about cuteness that demands to be shared.

It’s bizarre and quirky

Gawker hired Neetzan Zimmerman to produce the viral content that, as Gawker’s primary editor said, “for the sake of the other writers, [is] a necessary cog.” Zimmerman, who created The Daily What, says “When something goes viral, it tends to be something that is not expected to go viral.” Headlines like “This Pizza Has a Crust Made Out of Cheeseburgers,” and “Dead And Buried Hamster Emerges From Grave Alive And Well And Hungry For Brains,” tend to go viral more than what would traditionally be called “headline news.”

As Zimmerman said, A “taxidermied cat being that’s been turned into a helicopter—that’s clearly going to be successful, right? Because it’s got that element of shock, it’s got that element of a cat, you know, it’s basically just tailored to the Internet.”

It should hopefully be obvious from all of this that shareability is only one component of success. A piece of content that’s designed only to go viral is also likely to be poorly branded, irrelevant, and unlikely to lead to conversions down the road. For some more examples of successful link bait campaigns, we recommend taking a look at these 10 examples from WebPageFX.

2. Brainstorm Frequently

What should also be obvious from all of the above is that linkbait demands originality in some form. If the information isn’t new, the presentation must be. If the topic is “boring,” it takes creativity to transform it into something bizarre, quirky, or hilarious.

And while “cuteness” doesn’t necessarily demand creativity, if you keep pushing that button too often, it’s going to be seen as obvious pandering. Besides, it will still take creativity to transform a branding message into something even remotely cute.

Here are a few brainstorming tips to help you launch a successful link bait campaign:

Small groups are best

Put too many people in a brainstorming meeting and most of them won’t contribute. Groups of three to five are better for group brainstorming. In larger groups, people forget their ideas before they’re called on, and it’s difficult to get into a productive rhythm.

Individual brainstorming is a must

Some of the brainstorming should be done by individuals brainstorming alone. Many psychological experiments on the subject have demonstrated individual brainstorming sessions result in more ideas. Group brainstorming is a necessity in order make sure ideas are aligned with business goals and long-term strategy, but individual brainstorming is an important component that shouldn’t be ignored.

Try “brainwriting” instead of brainstorming

Studies have shown that this technique beats the pants off of traditional brainstorming. The process is simple. For three minutes, everybody writes at least three ideas. Then they pass their sheet to the left, read the previous ideas, and again record as many ideas as they can for three minutes. Keep doing this for either a set amount of time or until the group feels its ideas are exhausted.

Write it all down

Whether you’re brainstorming alone or in a group, write down every single idea. As we mentioned over at ProBlogger, psychology suggests that we reject creative ideas, even when we think we want them, and rationalize this by telling ourselves the idea wasn’t creative. Do not reject any idea that comes to mind. There’s plenty of time to weed through the list later.

Encourage constructive debate

This probably goes against everything you’ve ever heard about brainstorming, but the science is clear. Debate has a positive effect on brainstorming. While you should definitely record every single idea, debates paradoxically make people feel more liberated, and more comfortable sharing minority viewpoints. This allows more ideas to make their way into the discussion. Don’t get carried away with this, of course.

Mix ideas

If there is only one thing you should take away from all of this, it’s that mixing and matching ideas together is the best way to come up with new ideas. Don’t confine yourself entirely to your niche: Pull in ideas, concepts, facts, and stories from other disciplines in order to spice things up and draw analogies with your own subject matter.

Clearly, some of these tips contradict each other (debate vs. brainwriting vs. working alone, for example). Use more than one brainstorming method and measure the results. You may find that some techniques work better than others, or you may find that you need many different types of brainstorming in order to achieve the right variety of ideas.

3. Find Effective Sources of Information

Sometimes research comes before brainstorming, and sometimes it comes afterward. Both methods work fine, but result in different kinds of posts.

When the research comes first, it provides the raw material to combine and mash up into a unique idea. The advantage here is that you already have some idea of what facts and elements are going to go into the post. The disadvantage is that your ideas will be somewhat confined by the body of knowledge you’ve researched.

When the ideas come first, it forces you to stretch in your research and pull information from more unique sources. This can result in more unique ideas. The downside, however, is that you may discover  the facts contradict your original idea, and that making your idea work would simply stretch things too far.

Hopefully, it’s clear that you need both kinds of posts, and that it’s actually a good idea to do some research both before and after brainstorming in most cases.

As we said before, “insider information” is far more likely to go viral than a redundant article. You can’t always be the next Bob Woodward, but you can get your information from places most people aren’t willing to look:

Google Scholar

Peer reviewed articles and scholarly papers aren’t easy to read, but that’s precisely what makes them so useful as a source of information. There’s a lot of information contained in these texts that has never made it’s way into the blogosphere, and most of it is only “boring” because it’s presented in a very technical way. Pull out the most surprising facts and the key takeaways and you’ve got yourself some “insider” information, of a sort.

Your Client

This isn’t the first time we’ve mentioned how useful your client can be as a source of information, and it won’t be the last. Odds are your client has a proprietary database of some kind. If you can, take advantage of it as a source of raw data.

Industry Experts (and People in General)

Get in touch with experts in your niche. The well known ones can help with exposure, and the less well known source can also offer some “from the front lines” information that you can’t find anywhere else. Watch the nightly news and notice how even an interview with a random person on the street can help a bit with credibility. There’s no reason to limit sources of information to your own research. Mine people for ideas, opinions, and information. Be a journalist.

The Library

Yes, it still exists. Believe it or not, this is also a great place to look if you want to find information that’s never made it’s way online. Yes, this still happens sometimes!

Anything That Could be Considered “Raw Data”

Whether it’s government statistics or an industry survey, raw data that’s never been turned into an article or blog post is one of your most useful “insider sources.”

Other Disciplines

We might be repeating ourselves a bit by saying this, but we can’t emphasize it enough. While the other research strategies demand looking through dense material, this one allows you to skim lighter blog posts and news articles and use them as insights for your own field. This makes the research part easier, but the creative part becomes more involved. This is the tradeoff.

Conclusion

To produce linkbait, you need to “get” the Internet, and understand why things go viral. It takes a comprehensive brainstorming strategy and a keen understanding of where to find original data in order to pull this off. The sweet spot between these three strategies is the launching pad for your most successful link bait campaign.

Did you learn anything new from this post, and do you have something to add? Let’s keep this going in the comments, and please pass this along if you liked our contribution. Thanks!

Image Credit: Shutterstock / Melpomen

via searchenginejournal.com

3 ways to start your workweek refreshed, productive | Waccabuc NY Real Etate

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Image courtesy of <a href=What the Most Successful People Do on the Weekend: A Short Guide to Making the Most of Your Days Off”
Author: Laura Vanderkam
Publisher: Penguin, 2012; 47 pages; $2.99 e-book

Have you ever ended your workweek with a heartfelt “thank goodness it’s Friday” only to go back to work on Monday feeling more worn out and exhausted than you did three days earlier? It’s no wonder, what with the digital creep of work into our out-of-office time and lives and the fact that many Americans now maintain near superhuman recreational and household calendars.

Unfortunately, returning to work feeling depleted and worn out is a surefire way to start off an unproductive week — even if you did get your basement cleaned out or wrap up that lingering report that was due Friday over the weekend.

After her exploration of “What the Happiest People Know About Getting and Spending (Money)” and “What the Most Successful People Have for Breakfast,” author and time management expert Laura Vanderkam is back, sharing her findings on the topic of “What the Most Successful People Do on the Weekend: A Short Guide to Making the Most of Your Days Off.”

Here is just a sampling of the insights this super-short book has to offer:

1. “Keep a (tech) Sabbath.” Referencing Bible verses that explained that the Sabbath is intended not to create another rigid rule, but to ensure that people, their servants, oxen and donkeys had sufficient rest for the week ahead, Vanderkam encourages readers of all faiths to take time every weekend to observe a “stretch of time apart from the computer, phone and work stresses” in order to “create[ ] space for other things in life.”

Interviewing a number of A-list execs who swear by this strategy for preserving sanity and productivity, Vanderkam surfaces one surprising side effect of taking a regular tech Sabbath day: “[w]ithout the distractions of the Internet, you may find ideas rushing at you.”

2. “Put first things first.” Vanderkam borrows an exercise from the late author and motivational speaker Stephen Covey that involves organizing your priorities by first articulating to yourself the various roles you play in life that are important to you, then specifying the top two or three priorities you’d like to accomplish in each role over the 168 hours (week) to come.

Vanderkam suggests doing as some of the highly productive CEOs interviewed in the book do, and sitting down on Sunday to carve out time on your calendar to hit just the top two to three priorities for each role for the following week. “First,” she says, “blocking six to nine priorities into a 168-hour week still leaves a lot of blank space. But second, if you accomplished all those things, you would have an absolutely amazing week.”

3. “Life cannot happen only in the future. It cannot wait for some day when we are less tired or less busy.” Vanderkam points out that marathon runners know they require rest and cross training to make progress and have breakthroughs. In the same vein, she proposes, those of us who work hard, long hours during the week need to spend our precious, weekend moments doing completely non-work-related activities in order to store up the fleeting, precious memories of present phases of life with our families and to build skills and have insights that will make us better at our work.

“If you work long hours,” Vanderkam writes, “then weekends are key to feeling like you have a life that is broader than your professional identity — even if, and probably because, you take that identity very seriously.”

You might think the idea of a book about how to spend your weekend is silly or unnecessary. If you are routinely frazzled on Monday or you are committed to achieving peak performance in your career and your personal life, suspend your skepticism. If you fall into this description, I strongly recommend taking this super-short tour Vanderkam offers through a different way to experience your weekends in order to elevate your experience of your entire life.

via inman.com

Kelly Ripa Lists Crosby Street Penthouse | Waccabuc Realtor

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Source: IMDb

After quietly shopping their SoHo apartment around this summer, Kelly Ripa and husband Mark Consuelos have officially listed the penthouse for sale at a pricey $24.5 million.

Described as an “unparalleled penthouse,” the Manhattan property at 76 Crosby St. (also listed as 81 Spring St.) is enormous, measuring 6,792 square feet with 5 bedrooms and 4.5 baths.

The TV host and her actor husband bought the home in 2005 for $9.5 million and completed a two-year renovation to bring it to the luxury residence it is today.

The home has high ceilings, stained white oak floors with radiant heating and a custom kitchen stocked with high-end appliances. The master suite is described as the “ultimate retreat,” with two walk-in closets, soaking tub and steam shower.

French doors lead to a 2,500-square-foot rooftop terrace with an outdoor fireplace and plenty of seating. Another terrace spot, which includes an outdoor shower, is connected to a private home gym.

Ripa and Consuelos also own a home in Southampton, NY. Ripa signed a five-year contract for “Live! With Kelly and Michael” in 2011.

Listing photos courtesy of The Modlin Group. The property is co-listed with Adam Modlin and Raphael De Niro of Prudential Douglas Elliman.

via zillow.com

Waccabuc Real Estate | Bernanke: QE successfully brings down mortgage rates

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Federal Reserve Chairman Ben Bernanke discussed how the Federal Open Market Committee succeeded through its decision in December of its open-ended quantitative easing program, which has brought long-term interest rates down, and reduced mortgage rates to a ‘credibly low’ level.

Raising interest rates would increase budget deficits, making fiscal problems more challenging. Thus, raising rates would not be a sensible decision to get Congress moving forward on budget negotiations, Bernanke stated.

The Committee decided to continue to purchase additional agency mortgage-backed securities at a pace of $40 billion per month.

“Taken together, these actions should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative,” the report said.

Furthermore, there also hasn’t been a completely new method of monetary policy the Fed hasn’t explored and that asset purchases as well as communications policies are the two main tools at the Fed disposal.

Bernanke spoke on Monday to the University of Michigan’s Ford School of Public Policy, followed by a question-and-answer session. The public was able to ask Bernanke questions via Twitter.

One of the more popular questions asked, which was retweeted 190 is featured below. Click to view the tweet.

The first Twitter question asked, why the Fed continues to ‘undershoot’ its inflation target.

Bernanke stated that the short-term interest rate is close to zero and that the Fed has to pay lose attention to the costs and risks of the policies.

Quantitative thresholds are the better way to communicate interest rate guidance rather than providing a projected calendar date for policy shifts. The main benefit is that QE thresholds allow great clarity on policy evolution given the economic changes.

Additionally, Bernanke noted the main area of financial reform that continues to be neglected is both government-sponsored enterprises Fannie Mae and Freddie Mac.

The fiscal cliff resolution that was finalized, made progress toward long-term sustainability and also made a good start on removing components that would harm the economy.

However, “I should hasten to say we are not out of the woods,” Bernanke cautioned.

via housingwire.com