Continuing to examine and hold a lively discussion of the Northern Virginia Real Estate market.
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Contrarian,I feel their pain.Does anyone else also resent the manner in which this bailout was announced by Bush on Friday?The only part I like about the plan is the temporary insurance for money market mutual funds. That was a potentially massive catastrophe that needed to be averted, and easily could be by preventing the bank-run, and is unlikely to cost anyone a dime. But by announcing this plan before its approved, as if it has already been decided, seems like a huge over-stepping of power, and enormously pressuring the Congress to put in place what the administration has just promised the markets. I don't like this method at all, for something that unlike the Fannie and Freddie takeovers or the AIG bailout, doesn't seem to have the quid-pro-quo aspect necessary to prevent this action from simply stealing money from taxpayers and giving it to financial firms who made foolish gambles. I don't want us to make good on Bush's promises as a lame-duck president, because I think they're not the right plan, but at the same time, if his promises are meaningless, what will that do to the markets?? Grrr. He just keeps throwing us into the breach, doesn't he? And I don't know that Congress will do any better. But I don't want that amount of power in an un-elected official either...
They didn't announce this any differently than other legislation the president sends to Capitol Hill. I can't give you the reasons why the markets responded the way they did, but I suspect it was simply that market saw they had the attention of the administration and that there would be some legislation to deal with it within a week. The DJ is is down 200 as I write this, so is that to be taken to the response of some in Congress who want to change the proposal to freeze executive salaries and make sure the banks don't turn this into a taxpayer rip-off (any more than it is.)? No, the reaction from Congress was to be expected because that is the way the system works. This legislation will not end up reading the same as it did when Bush sent it to Capitol Hill.My quibble with this is that it does nothing really to deal with the real estate slump. It takes care of Wall Street's security issues, but as the WPO story shows that contrarian posted above, has little in it yet for Main Street.
edward allen,Yes, they do frequently announce proposed legislation before it's become a real bill, but the tone and tenor of this announcement was unusually concrete (not unprecedentedly so). Partially it was the wording which was always in the tense of "we are doing this", "this plan is already laid", as opposed to "we propose a broad measure... Congress should swiftly..." And partially there was the unusual level of believability imparted by the Fed's recent strong actions. Granted, the Fannie Freddie part of that had already been approved, and things like Bear Sterns did get congressional approval, whereas this new plan needs authorization. But viscerally speaking, since such other drastic actions had been so recently taken, Bush's statements about things he wanted to do in the market seemed more believable than say when he presented comprehensive immigration reform. It looks like the Dodd plan may be an improvement in terms of tax-payer liability, so there's hope that this won't be a total debacle.I don't really want something to deal with the real estate slump, affordable prices will do that on their own, and government intervention to keep credit markets afloat are needed to make sure affordability prices doesn't mean "in cash." The complainents in the WaPo article didn't want help for their neighborhood speculators either.
Cara & Edward Allen - regarding the timing of the announcement, I think the more interesting thing occurred on thursday.If you recall, news of a possible RTC type plan was made public thursday afternoon. When wall street got word of this, it posted a huge 400 point rally.To me, this indicates the RTC plan was a trial baloon - leak the story & see how markets respond. If the markets like it (i.e. 400pt rally) officially announce it the next day - if they dont like it (i.e. the markets dont respond), say nothing, and move on.
Cara: In normal times, I would agree on allowing the RE market to find the new prices, but the trouble with periods of rapid devaluation is that there is no agreement possible. After Bear Stearns, and these other remarkable developments, etc., we are clearly no longer capitalists willing to allow the stock markets to claim their victims of poor financial planning. If we are going to adopt measures to work out Wall Street problems caused by financial speculation, we need to deal with the foreclosure issues that are clogging up the market with unsold inventory. It really doesn't do much good to buy up this tranche of toxic securities only to find you have a second lot six months from now as the Alt-A's fail, which they will.Since we have already put our foot into socialist waters (up to our necks, I fear), I think some form of a Resolution Trust Corp. concern is needed to reduce the housing inventory and get the market started again. Since they are doing the Wall Street part, they could easily put that new concern in this bill, too. If you remember how the RTC worked, they ended up bulldozing down new apartment and condo projects because there was no market for them.This has got to be done quickly, because the longer it sits out there, the more it becomes a fund-raising tool for members of Congress (facing reelection in the next five weeks), to raise huge amounts of last-minute campaign funds. Call me a cynic, but I am already sitting here wondering already how much money they are collecting from these hated salary capping plans.
Looking for some advice & comments...Here are my thoughts about houses being on the market for an extended period of time and making an offer: 1. If the house has been on the market for over 100 days, it is totally fair to make an offer 10% below the asking price.2. If the house has been on the market over 200 days it is also fair to make an offer 15% below the asking price.I understand that the owners may counter or flat out refuse, and I would be okay with that. I am a pretty unemotional person when it comes to making an offer. I feel like I can take it or leave it, that is why I have this opinion. I am new to the area in regards to buying a home and I just wanted to see if this is above board around here...
e. floyd: An offer is what ever you think the property is worth, no matter how the seller is pricing it. I would go for the lowest possible.
To any experienced renters:I am thinking about either renewing my lease or move out. one of the reasons I dislike my current place is that for a 700 sq ft place, I am paying over $100 in electricity bill per month. This seems excessive! I am in my place only 3 or 4 days a week and I don't even have my AC on all the time. Any advice on what I can do about this if I do decide to stay?Also, with the apartment management company, how far can I re-negotiate my rent? 10% off?Finally question, if I decide to move out, the lease agreement says that the apartment has to be clean when I move out. How clean does it mean? Do I have to wipe down every single dust and vacuum the floor?I am an inexperienced renter - so any advice would help.
Edward, thanks for the comment. Yep, I agree with you, the best offer is what you think the property is worth. LW - being a renter for several years, I always try to renegotiate my rent each year. Sometimes it works, sometimes it doesn't. The best way to go about it is to be friendly, point out how you are a good, quiet, friendly tenant (if you are) and that you always pay on time and see no need to move if the rent can be negotiated in a manner that helps everyone out. The landlord and yourself, make it a win-win situation, and typically you will either get a reduction, or stay the same, or reduce the increase the landlord was trying to pass onto you.good luck!
lw,e floyd's advice about renegotiating is about right, just realize that it may or may not work.electricity? Well all the usual suspects, change to the new energy-saver bulbs, they have cheap ones at Home Depot, plug all things like the TV, DVD player, etc into a power strip and unplug the power strip when you're gone (doesn't work so well for tivo-ing shows, just get them later by netflix or watch them online...) Same goes for your computer, even the microwave. Check the windows for drafts, there should be instructions for how to do that that come in little pamphlets with your power bill, as well as online. But $100/month is not necessarily high, we only have 200 more square feet and that's similar to ours in the summer. Oh, and check how cold you're keeping the refrigerator, that's a big guzzler, especially if it's just filled with air.
Cara - $100 a month seems a bit high to me. My place is 1300 sq ft but I only pay about $80 a month in the summer - plus as you can imagine, the windows in a 200 year old house leak like a sieve. Then again, 8 inch think walls may have something to do with the energy savings...LW - if you do move out, be sure to ask the new landlord what the SEER rating is on the AC unit (it should be a minimum SEER rating of 12). Since the landlord doesnt pay elecricity, he has no incentive to replace old inefficient systems - yet it can make a huge difference. My parents down in florida put in a new system (cost about $4,000) and their bill went from 230 a month down to about 100.
lw,oh yes, and you had asked about cleanliness. I always clean my place thoroughly when I leave, not professionally, but vacuuming, including using the edger tool, cleaning out the refrigerator with windex, scrubbing the sink and bathtub, and at least dusting the blinds and surfaces. That kind of stuff.But the thing is, if when you arrived it was spic and span, that means they have it professionally cleaned between tenants and probably painted and all the rest, and you don't need to be too thorough, because the pro's will do a better job anyway. And then there's whether you have a security deposit in and whether that's contingent on cleanliness. If not, they'd have to pursue you in court for damages, and that's not worth their time over spotty cleaning (as opposed to actual damage).If you don't have a deposit with them, and they don't get real cleaners, then it's a matter of how much of an obligation do you feel to the next tenant. Which is some of why I've been very thorough in some cleanings where I knew I would be the last person to do anything before someone else tried to move in.CRT,Ours is that much partially because I have to use AC here all summer even if it's nice out, because I'm highly allergic to whatever the folliage is here. I know, I should just go to a doctor. (Claritin only works for about 30 minutes for me)
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