Chris Butterworth (Bio)
July 22nd, 2008
Categories: Chris B, General Musings

There will be a new MLS system in place beginning next Monday. Actually, all new activity in the current MLS system will be suspended on Thursday in preparation for a weekend conversion to the new system.

I spent a little bit of time test driving the new system this morning; it’s going to be quite a change. Although it’s radically different from the current system, at its core it isn’t all that different at all. Here are some of the things that jumped out at me right away.

The single biggest difference between the two systems is the access to, and ability to manipulate, data. Our MLS system contains millions of pieces of information. However, it hasn’t always been easy, or even possible, to find a particular piece of information. The new system will make searching, sorting, finding, analyzing, and presenting various data much easier. Of course, it will have pros and cons, and some people will pine for the good old system.

Pros:

Access to Data. I’ll be able to manipulate, search, sort, and analyze like never before.

Time Savings. Many of the things I do today require multiple steps, and sometimes I have to use multiple applications. Most of these functions are built into the new system.

Polygonal Searching. The new system allows me to search by map, using my mouse to click my way in and around neighborhoods or along a diagonal border. Say goodbye to often-useless rectangle search borders!

Cons:

Ease of Use. I don’t think many of my competitors had the ability or desire to get everything possible out of our current MLS system. Now that a lot of that functionality will be only a few clicks away, more of the less tech-savvy Realtors are going to be able to figure it out.

Learning Curve. It looks like I’m going to be spending a lot of time over the next couple of weeks learning all the ins and outs of the new system… Oh well, at least it gives me something to do.

Your looking forward to a better system Realtor,

Chris Butterworth

Technorati Tags: FlexMLS

Chris Butterworth (Bio)
July 18th, 2008
Categories: Chris B, Moving Stills

The original hospital in Phoenix, St Joseph’s began in 1895 when the Sisters of Mercy raised enough money to rent a six-bedroom cottage to help tuberculosis patients. In 1945, as Phoenix’s population boomed to 100,000 people, the Sisters purchased 10 acres of land (for $25,000 and way up north of the city) for the current site at 3rd Avenue and Thomas Road.

Your prefers the outside of hospitals to their inside Realtor,

Chris Butterworth

Technorati Tags: St Joseph’s Hospital

Chris Butterworth (Bio)
July 17th, 2008
Categories: Market Analysis, Chris B

Is it legal? Is it morally acceptable? Is it ethical? Would I be comfortable if the newspaper printed a story about it? And after all is said and done, is it the right thing for me & my family?

I had a conversation with somebody this week which sent shivers down my spine. He told me about his plan, and asked my opinion.

Here’s his plan.

He bought his house in early 2006 for about $400,000, putting down 10% and financing $360,000. (assuming a fixed rate mortgage at 6.25% gives him a principal & interest payment of $2,217.) His home is worth about $250,000 today, judging by a few of the same floorplans currently for sale. He believes that if he’s patient and negotiates well, he might be able to buy one of those homes for $225,000. (that remains to be seen, but let’s believe him for the time being.) If he made a 10% down payment on that house, he would finance $202,500 with a monthly payment of $1,247.

What if he buys the new home, which is basically the same as his current home. Then, once he’s moved in, he’ll stop making payments on his current home, and just give it back to the bank. His credit will show a foreclosure, but he’s not planning on moving anytime soon. His car is new, so he won’t need to finance a car for a few years either. The rest of his credit accounts will remain in good standing.

Looking to the future, it wouldn’t matter what the house is worth, or what time period you’re considering, since both homes will always be worth about the same. $300k? $500k? $700k? Either way, he will have about $150,000 additional equity in the home, AND he will be paying about $1,000 less per month on his mortgage payment.

Here’s my opinion.

Wow - those are staggering numbers. I don’t think it’s illegal, although I would consider consulting with an attorney before doing this, as I’m not sure if the bank has the right to sue you - if you can’t prove the inability to make the mortgage payments, could the bank win a judgment against you for the $150k? (maybe a breach of contract lawsuit?) As for morally / ethically / front page of the newspaper - I don’t like it, but it’s not my choice to make. I’m not a moralist, and I don’t claim to be perfect, but this does sound a bit shady. On the other hand, you’re talking about saving a tremendous amount of money over the course of 15 years - money I’m sure you can use for kids’ college &/or retirement.

I try pretty hard to live up to my commitments, and we both made commitments to our mortgage lenders. Personally, I’m not ready to follow in your footsteps, if that’s what you’re asking. On the other hand, I’m sure we all have a price. Would I follow your plan if I could come out $1 million ahead? $5 million? Hmmmm - I can’t say “no” definitively… So we’re really just talking about each person’s threshold; that’s what scares me.

Your doesn’t like the sound of this plan Realtor,

Chris Butterworth

Technorati Tags: keys for home

Chris Butterworth (Bio)
July 16th, 2008
Categories: Chris B, General Musings

Well, sort of. I was on tv last night, in the news, but my last name never got mentioned..

In the last year I’ve been interviewed by various magazines and news media 5 times – twice for magazines, once by a local newspaper reporter, and twice on camera for the local tv news. Yesterday was the first time I made it through the editing room and into the story!

If you didn’t catch the Channel 3 news last night, you can click the picture above to see a video of the story. (the link takes you to azfamily.com; I can’t get the video embedded..) Unfortunately, the final cut didn’t include a proper introduction or a screen graphic with our website’s address. Maybe next time…

Reporter Kristine Harrington and I spoke for almost 15 minutes (on camera and off), covering a wide variety of angles regarding the current market, many of which I’ve written about on this blog at one time or another. But the cover story was ASU’s new report showing a year over year drop in prices, so obviously that’s where the focus was.

Your telling it like it is Realtor,

Chris Butterworth

 ps - Thanks to Jay Thompson for not being available!

Technorati Tags: Channel 3 news

Chris Butterworth (Bio)
July 15th, 2008
Categories: Chris B, Moving Stills

It wasn’t too long ago that the Carefree Highway was WAY north of town. Today there are developments springing up – both residential and retail/commercial – all the way from I-17 to Scottsdale Rd. But there’s still enough empty desert, and the occasional Cattle Warning, to remember what Phoenix used to be like…

Your remembering when… Realtor,

Chris Butterworth

Technorati Tags: Carefree Highway, North Phoenix

Chris Butterworth (Bio)
July 14th, 2008
Categories: Chris B, Foreclosures / Short Sales

My wife & I recently had a chance to catch up with an old friend. He had a pretty sad story to tell, with a combination of bad luck and unforeseen events. But he’s a positive attitude type of guy, and he’s able to see some silver linings around all the clouds. Here’s the gist of it…

He bought his home in 2005. Like tens of thousands of others, this turned out to not have been a great time to buy. But prices were going up so fast, he and his family were excited to move up to a larger home before it got completely out of reach.

He financed his new home with an Adjustable Rate Mortgage. I’ve written before that 9 out of 10 people (or more) should use a 30 year, fixed-rate mortgage, but that for certain people in certain situations an ARM is an ok choice. Our friend is self-employed, and had been able to consistently grow his business. It wasn’t unrealistic to think he could continue to expand over the next 3 years. Although hindsight is 20-20, it wasn’t a terrible plan to think he would be better equipped to pay the mortgage when the interest rate adjusted upward in 2-3 years.

His business is service-based, and driven primarily by two factors: Residential homes selling, and/or Families having discretionary income. Unfortunately, the housing market and the ensuing recession did a 1-2 punch on his business.

Then, In 2007 he suffered a freak injury, which required surgery, and he was effectively put “on the shelf” for a few months. His income all but evaporated at that point.

Shortly after all this, his mortgage rate adjusted upward (as expected), and he could not make his mortgage payments. A few months later the bank foreclosed on him (and his family.)

The silver lining? He was able to find a home to rent which is similar to, and even a little bit larger than, the home he lost, and his rental payment is about $1,200 per month LESS than his mortgage payment was. He’s healing, and his business is getting back on track. His credit is in bad shape for the time being, but he isn’t planning on moving anytime soon. In a few years, his credit, his body, and his business will have all recovered, and he’ll have the flexibility to decide what he wants to do at that time.

Best of luck, ______. You know we’re pullin’ for ya.

Your appreciates people who turn lemons into lemonade Realtor,

Chris Butterworth

Technorati Tags: foreclosure story

Chris Butterworth (Bio)
July 11th, 2008
Categories: Market Analysis, Chris B

I read an economic / geopolitical report this morning which was long, detailed, and very well presented. And buried deep down in the body of the report were a couple of paragraphs about the U.S. economy that made me feel good about what’s in store as we head into the 3^rd quarter.

First of all, I need to give credit where credit is due.

John Mauldin is a world renowned economist, who publishes a FREE weekly email. I’ve said many times before that this is one of the most important emails I read all week. You can subscribe to it here.

George Friedman is with Stratfor, and has some of the best geopolitical intelligence on the planet. Mauldin’s Outside the Box newsletter features Stratfor’s forecasts regularly, and I learn more from this one email than I could learn from watching CNN every day.

Anyway, buried in the body of Stratfor’s Third Quarter 2008 Forecast was this little gem (and I’ll quote directly from the newsletter):

Regional trend: Despite much talk to the contrary, the United States will enjoy strong economic performance. In part, this is because of the massive inflow of money into the United States from Asian and Arabian states.

While talk of recession in the United States remains par for the course, the U.S. Federal Reserve is both becoming optimistic and leaning toward interest rate increases to contain inflation. The Fed will always err on the side of triggering faster growth (and inflation with it) rather than slower growth that could lead to deflation and induce a Japanese-style depression. Add in roughly $100 billion in stimulus checks, and the United States is well past the worst that the slowdown of the latter half of 2007 presented. (emphasis mine.) This does not mean that the “strong economic performance” we anticipated has materialized — but the truth so far is much more positive than the doom-and-gloom talk that dominated American media the first half of the year.

Obviously, not all things are cheery. The American property market is far from recovery — the rising inventory of unsold homes in particular is a critical factor to watch — and strong commodity prices are making the U.S. consumer take pause. Additionally, a combination of American subprime contagion and regional structural and cyclical weaknesses could trigger a European banking crisis in the third quarter. But Stratfor’s primary economic concern for U.S. growth remains tied to the election cycle. Neither presidential candidate has any interest in pointing out positive aspects of the current government’s economic management. And, in past elections, “It’s the Economy, Stupid” has not only garnered votes, but also has had the side effect of amplifying public perceptions of the economy’s problems.

Of course I’d prefer to read that the housing market is well on its way to recovery, but at this point I’ll take my good news where I can get it! We all know the market is cyclical and will heal with time – a better economy will help consumers’ pocket books and consumer confidence, which in turn will help heal our housing market a little faster.

Your feeling better about the economy Realtor,

Chris Butterworth

Technorati Tags: economic forecast

Chris Butterworth (Bio)
July 10th, 2008
Categories: Chris B, Homeowner Help

What should I do about the vacant house next door?

That’s a question I hear fairly often right now, since there are so many vacant (bank-owned) homes scattered across the valley. And for the most part, there isn’t too much you need to do (or should do, or are allowed to do) - it’s probably an eyesore today, but most likely the home will have a new owner before too long, and somebody will be working hard to make it look beautiful again.

That being said, there are 3 issues I would recommend taking action against.

Squatters &/or Vandalism. I’ve seen vacant homes that teenagers have used as a place to hang out, and I’ve seen homes where a community of homeless people decided to take up residence. I’ve also seen homes where people took the liberty to break windows, spray graffiti, and otherwise vandalize the home. If you see any of these things happening, give the listing realtor a call, and he/she will probably call the police for you. Or you’re welcome to call the police yourself.

Green Pool. This actually poses a health risk, as it can be a breeding ground for mosquitoes and the West Nile Virus. The best solution I’ve heard so far is to stock the pool with Gambusia fish - little guppy-like fish with a voracious appetite for mosquito larvae. If you give Maricopa County a call at 602-506-0700 they’ll even give you some fish for free!

Pest Control. If no one is spraying for pest control, then the home’s insect population is probably booming, especially during these hot summer months! Unfortunately, these little bugs don’t seem to care about who owns which home, and they certainly won’t ring the bell before they infiltrate your home. In addition, more insects means more food for larger pests, including scorpions and black widow spiders. Talk with your pest control professional about a plan to step up your border control.

Once you’ve taken care of the safety concerns, you can wait patiently and wonder about who your new neighbors are going to be.

Your recently got new neighbors a couple houses away Realtor,

Chris Butterworth

Technorati Tags: green pool, vacant home, gambusia fish

Chris Butterworth (Bio)
July 8th, 2008
Categories: Chris B, Green Living

T. Boone Pickens opened a website today: www.pickensplan.com. You might not have heard of it yet, but you’re going to hear about soon, and you’re going to hear about it a lot, during the next 4 months.

T. Boone Pickens made a fortune in the Texas oil industry. He made another fortune as a corporate raider. He’s garnered a lot of publicity for his efforts in shareholder-rights, philanthropy, and as a big-time contributor for conservative politicians. I read recently about his efforts to buy massive amounts of underground water rights in northwest Texas, as he believes water will be the next oil in Texas.

Well, this one’s going to trump them all. He’s proposing a massive shift to harness the power of the wind, on a national scale, and he wants it to be the cornerstone of this year’s presidential election. Wind energy isn’t new, obviously, but it’s never been done on a scale this large.

Anyone who’s read my blog for awhile knows I’m a big proponent of alternative energy – it actually drives me crazy that we have so much sun, and heat, that isn’t being harnessed for energy here in Arizona.. But that’s another topic for another day!

Give the video below a look – it’s an eye-opening 4 minutes.

Your thinking T. Boone Pickens is on to something big Realtor,

Chris Butterworth

Technorati Tags: wind energy, green living, t. boone pickens

Chris Butterworth (Bio)
July 7th, 2008
Categories: Chris B, Moving Stills

Independence Day is a great day to be an American. It’s a day when it doesn’t matter whether you voted for the guy in office, or whether your views on politics/religion/economics are different from your neighbors’. It’s our differences that make us unique (that and our willingness to fight, and sometimes die, for the right to be different), and it’s what makes this the greatest country in the world. I hope everyone had a wonderful 4th of July weekend!

Your proud to be an American Realtor,

Chris Butterworth

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