Reuben “Rudy” Clemons, Ph.D.

1372 Smith Street – Atlanta, GA 30316

Offered at $165,000

For More Information Visit This Home At:

http://1372.rudyclemons.com

Click Here for Virtual Tour

COST OF NOT BUYING A HOME

1)  Rent Lost

Rent = $1,200/MO - the average person takes 30 days to buy.

If you wait 6 months, you will pay you landlord ………………..   $6,000  

2)  Rate Change

If today’s rate is 5.5% on a 30 Year fixed rate mortgage, assuming a $200,000 sales price with 5% down:

Your payment will be… $1,073 per month…

The following shows what happens to your payment if your rate goes up by the time you buy (in ½% increments)

Rate      Pmt             Loss/mo   Cost/YR         Cost 7/YRs               Cost 30/YRs

6.0%     $1,133          $  60       $   720           $  5,040                   $21,600

6.5%     $1,194          $121        $1,452           $10,164                   $43,560

7.0%     $1,256          $183        $2,196           $15,372                   $65.880

This number you must look at from the long term picture.  If you wait 6 months to buy a home, it is possible (or even likely) that the rates will be up .5%.  The cost/loss to you IS NOT $60 per month.  The cost is $60 per month times however many months you own the home. The average American owns a home 7 years, so that loss equals $5,040.  If you keep this home as a rental property (a great idea especially for your first home and when rates are this low) then the loss is times 30 years, or $21,600.  Of course if you look at it like a good financial planner would, your loss is not simply the $21,000 but it’s that amount times the opportunity cost of lost interest had you invested that money yielding 5%-10% appreciation compounded annually.  This of course multiplies the loss to 2 to 3 times the actual cash loss!!!!

And if you are waiting until “next year” to buy that rental property…”Hello”!

3)  Appreciation Lost (Assuming a $200,000 sales price)

Appreciation             Per Month               6 Months                 1 year

3%                       $   500                    $ 3,000                   $ 6,000

5%*                     $   833                    $ 5,000                   $10,000        

6%                       $2,000                    $ 6,000                   $12,000

8%                       $1,333                    $16,000                   $32,000

10%                     $1,666                    $20,000                   $40,000

*Metro Atlanta typically appreciates at an average rate of 4%-5% per year.  Atlanta was predicted to appreciate 24% over the next 5 years (CNN.com “Top 10 Places to buy-NOW”)

4)  Tax deduction/interest write-off

This is the trickiest of the calculations because everybody’s tax situation is different, and the tax code is a tad bit complicated.  But as a general rule, you can write off 100% of the interest portion of your payment.  And if you didn’t know, the interest portion is MOST of the payment (for the first few years anyway).

For example:  using the examples above, with a $1,073 per month payment ($190k loan @ 5.5%), the interest portion of the first payment is around $850 per month.  So that’s the write off that you will NOT be getting per month until you buy.  Most people buying this price home are in the 28% tax bracket plus 6% state.  That means the actual cash loss is the monthly payment times your tax bracket.  Let’s say 33%.  So in this example, you are losing $280 per month CASH in tax deduction that you are not receiving.  That’s not even taking in to account that writing off $10,200 per year ($850 times 12 months) would probably take you in to a lower tax bracket; consequently, you would pay taxes at a lower rate…… (again, I am not an accountant nor do I ever want to be one; so, consult a CPA regarding your particular tax situation).

So,….Your “lack of deduction loss” is appx.…. $250- $300 per month

SUMMARY:  IF YOU WAIT 6 MONTHS TO BUY, YOU ARE LOSING BETWEEN $8,000 AND $15,000 IN THAT TIME ALONE!  IF YOU MISS TODAYS RATE, IT COULD COST ANOTHER $15,000 TO $100,000 MORE OVER THE LONG HAUL.

One last point: Affordability and lifestyle

I do not recommend ANYONE BUYING A HOME that they can not afford, or that will make them ‘house-poor’.  I recommend that you should be fairly conservative.  This means add up your PITI (total mortgage payment with taxes and insurance added in) and your payment should NOT be above 30% of your GROSS monthly income (before taxes).

Remember this, though:  If you ‘wait’ to buy, that $200,000 home will most likely be $210,000 next year (5% appreciation).  So the question you must ask is, “Is my income going up 5% per year?”  If not then you will be able to afford LESS in a year than you can now.

**This is not intended as an earnings claim on purchasing real property.  Past results are not in indication of future performance.  Please consult your tax advisor (ask about the W-4 form).

Windows of Opportunity

RISMEDIA, Oct. 9, 2007-The market facts tell us that-right now-there is a truly unique window of opportunity for well-informed buyers of residential real estate. As we look back historically, there have been previous “windows of opportunity” for buying real estate, stocks and other investments. How many times have we heard those familiar words, “I sure wish I had bought when ….?”

The problem is that for most consumers these windows of opportunity are easy to see historically but are often missed as they occur. People who make money in real estate do not just buy low - they buy the right property at the right price and in the right location for their specific needs.

Nationally, many pundits are saying that next spring is probably the right time to buy - and that is true in many parts of the country. The facts tell us that right now is the right time to buy the right real estate in Atlanta. There is an abundance of inventory, sellers are motivated, mortgage rates are low and long-term trends for future values are excellent.

National Market:

First let’s review the national market. We hear all over the media terms like “real estate recession” and “real estate bubble.” Yes, that does get attention - which sells advertising. That is how the media makes money. So let’s review some of the facts that will help you make money!

CNN Money reported on September 25th that “Home Sales Dropped for the 6th Consecutive Month to the Lowest Levels in 5 Years.” And that is true. However, the national market is largely the story of 7 states. California, Nevada, Arizona and Florida had huge run-ups in prices driven by speculators and flippers.

Those markets are now correcting as they should. Midwestern states like Michigan, Ohio and Indiana are suffering from population trends moving in the wrong direction.

Foreclosures have been increasing as adjustable mortgages and other “exotic loans” reset to higher payments. In October, we will see a peak in ARM adjustments for 2007. Another significant adjustment will occur in March of 2008. The result will be several million homeowners with substantially higher monthly payments. That means more foreclosures are likely ahead. The sub-prime crisis and some questionable lending practices have led to a serious restructuring of the mortgage industry. Fifty mortgage lenders have already closed their doors. This led to the recent Fed actions including pumping $38 billion of liquidity into the market, lowering the Fed funds rate twice by a half point, pushing legislation to allow the FHA to underwrite more mortgages and for more disclosure in the mortgage process.

More foreclosures will create more supply and even better opportunities for buyers. Caution: Buying foreclosures is much more complicated than most realize.

New home construction is challenged. Builders were over-building in many markets and are now stuck with significant inventories. This is especially the case in the western states and Florida. Many of the large public companies in this segment are seeing their stocks tumble and shareholder lawsuits are growing.

Homebuilders have stopped building spec homes in most markets until they finish moving their inventory. New homes supply is significantly dropping which means that the current overall supply will be absorbed faster than normal. That means that this buyers market will not last.

Atlanta Market:

So what does all this mean to Atlanta? Atlanta did not experience a big run-up in prices and has great prospects for the long-term trends that will positively affect home values. In the first half of 2007, the Atlanta real estate market was off slightly - running around 2004 to 2005 levels. Since June, there has been a significant drop. In August, Smart Numbers reports that closed sales were off 34.6% which is the largest decline on record since 1996. Pended sales and units were off even more. Significant market declines create buying opportunities.

So what is causing this? There are multiple factors including:

• Potential buyers that cannot sell their existing homes - especially those moving from other markets.
• Potential buyers that can no longer qualify for the mortgage on the price of home they wanted to buy.
• Potential buyers simply waiting on the sidelines trying to figure out - “when is right to get back in the market.”

Much of this is caused by media-driven fear and consumer confidence is at an all-time low.

Historically, the Atlanta market has strong sales in the spring and early summer. The market starts to slow in July, August and September. In October, we typically see a noticeable jump and then the market slows again through the holidays. Mortgage rates have historically seen a similar pattern and we expect them to drop further later this year with increased Fed action. Smart Numbers reports that “days on the market” plus expired and withdrawn listings are at all-time highs. This signals that sellers have gone through the denial and anger stages and are now accepting the fact that they need to improve the competitiveness of their property to sell it.

That means that - right now - is a great time to buy the right real estate in Atlanta. Supply is high, sellers are willing to make deals and mortgage rates are historically low.

Home Values:

So what affects home values over time and what are the odds that your investment in real estate will pay off in the future? Home prices are generally driven by supply and demand, population and job growth, costs of new construction and mortgage rates. Atlanta currently has an overabundance of supply. Single family homes currently show over 13 months of supply. That said, new homes starts are significantly lower so the current excess supply is expected to be absorbed in the next 12- 18 months. This is why - listen to these trends on Atlanta.

Atlanta has an incredible future. Our economy is strong and diversified. We have an active and business-friendly government. Hartsfield-Jackson airport is an incredible asset which allows passengers to reach more places in the world quicker than any other metropolitan area.

• Atlanta created 60,000 new jobs in 2006 - 3rd in the nation. (Bureau of Labor Statistics)
• Atlanta has the highest percentage increase of new millionaires - 1st in the nation. (Claritas)
• Atlanta is the #1 destination for young professionals. (Geolytics & U.S. Census)
• AARP rated Atlanta as the best city for baby boomers & seniors to live.
• In the last 6 years, Atlanta added more people than any metro in the nation. (Fortune)
• Fortune magazine says that Atlanta is expected to add 2 million more by 2020 - roughly the size of  

Denver.
• The Census Bureau and Virginia Tech released a report that says that in the next 25 years, Atlanta will be the center of a “Megapolitan” cluster of over 7 million people.

Atlanta has been a national leader in housing starts for the past 10 years with over 70,000 new home starts in 2006. The costs of lumber, concrete, land, development and labor are expected to increase - causing the average cost per square foot of a home to rise. Housing starts in 2007 are considerably down and the forecasts for 2008 and 2009 are also lower.

Mortgage rates remain historically low. The recent fed cuts have not yet translated to long-term rates that help lower mortgage rates - but we expect rates to go lower for the remainder of the year.

Additional action by the Fed is likely.

CNN recently rated Atlanta as the leading large metro and the 4th city overall that is poised for a real estate “bounce back” in 2008 and 2009. Atlanta is a great place to buy “the right” real estate. That is why Donald Trump is building Trump Towers Atlanta. That is why many wealthy individuals are buying and investing here. They see the next wave coming and are smart enough to buy ahead of the wave when prices are lower. And we wonder how the wealthy get wealthier?

The Right Choice for Buyers:

Real estate investors make the highest returns by making the right choice in selecting an expert to advise them through the process. We have provided a perspective on the national market and the general Atlanta market. However, the submarkets locally can be very different. Areas of town, neighboring communities, homes on different streets or individual homes can have very different investment values. Donald Trump does not buy real estate by himself. He finds an expert, who knows their local market, is a great negotiator, knows real estate contracts, knows property valuations and delivers great client service.

The facts tell us that right now is the right time to buy “the right” real estate in Atlanta. There is an abundance of inventory, sellers are motivated, mortgage rates are historically low and the long-term trends for future values are excellent.

The Right Choice for Sellers:

For sellers, this type of market requires a different approach. Buyers are comparison shoppers. When there are many opportunities, buyers only want to consider the best opportunities. They will not waste time on properties they perceive to be overpriced, in need of significant repairs or that require upgrades. In a buyer’s market, your value proposition must be clear and compelling.

Here are some keys to success in a buyer’s market.

First, your property must be found. Since over 80% of buyers search for properties on the Internet, your property must be exposed in all the right places online. Your listing agent should be exposing your listings on as many major national and local Web sites as possible. They should also be actively working the Realtors that do business in the area. Last, but not least, they should be targeting neighbors and other potential buyer segments directly.

Second, your property must be highly prioritized and distinctive. You must understand how the leading Web sites prioritize their listing searches. Most favor multiple photos, virtual tours, video and other rich media. Showcase, featured and branded listings on major Web sites such as Realtor.com are also very helpful. If your listing is buried deep in the search pages, it will never be found!

Third, your unique value proposition should be displayed in beautiful rich media so that consumers want to come see more. This requires high-quality images with impact text descriptions. The latest innovations are widescreen narrated videos which communicate your story in the most powerful format available.

It is more important than ever to create a powerful value proposition that makes your property stand out. Print materials must also be beautiful and distinctive. Again, larger “rich media” images help make your property stand out. These require the use of higher quality pictures - not the same images that are used for Web sites. Otherwise, your brochures will only have very small pictures and they may still be grainy.  Your listing agent should use tools such as property cards, flyers, property brochures, and ecards.

More and more sellers are realizing that the market has changed and they need to improve the competitiveness of their value proposition to sell their property. They understand that we are in a buyer’s market and their approach to selling their property must be different to attract buyers. They also realize that they will have the opportunity to take advantage of this market for their next purchase.  Especially for sellers that are moving up in price, they see the opportunity to make more profit on their next home. Some sellers may be tempted to take their property off the market and just wait. This is a risky strategy. We are very bullish on the long-term trends for Atlanta.

However, there are no guarantees that the market will turn back quickly. As homes mature, they require more repairs and may need significant upgrades to compete in the future. There are no guarantees that mortgage rates will remain as low as they are today. This is especially true with an upcoming election cycle. New home construction starts are likely to return to higher levels and may increase your competition.

Days on Market (DOM)

The Average Actual Days on market are critical to a seller for several reasons:

·         It's important for you in setting realistic expectations about the time needed to sell your home

·         It will help you evaluate any offers that come in and make an educated decision about whether it's advisable to you to wait for another offer or take what's on the table

·         As a seller if you know the Average Actual Days DOM for your market (or, better, yet, for your neighborhood), with this accurate information you will understand the market and we will be able to guide you through the process like a professional – to sell your home in the least amount of time for the most money!

Problem with DOM Statistics:   Most MLS databases have a much-manipulated DOM number which is invariably skewed low. However, it is possible to determine the actual DOM for your market by using the absorption rate to calculate the true DOM for your market area. Here's how you get the real DOM:

·         First we find out how many homes sold in your market last year and how many are currently on the market. For example, if 10,000 homes sold last year, and there are currently 5000 on the market, what those numbers indicate is that the inventory turned twice last year (10,000/5000 = 2.0).

·         Second there are twelve months in a year, and 12/2.0 = 6.0, which is the absorption rate, meaning that the average time actually on market is 6.0 months.

·         Third we convert the absorption rate to days on market, you simply multiply this last number by 30 (6.0 x 30 = 180).

Why Use Absorption Rate:  If you figure DOM this way, you'll eliminate all manipulation in your market by builders and agents who re-list stigmatized homes, which of course are those homes that have picked up a negative image due to their excessive time on market.

Standard Deviation (STDEV) for DOM

Here's what DOM Standard Deviation means in selling your home:

·         Let's assume that we have calculated the standard deviation of the DOM is 53 days.

·         Let's further assume our calculation of the absorption method indicates that the true DOM is 186 days.

·         Add one standard deviation (53 days) to your average of 186, and you have 239 days.

·         Add another standard deviation, and you have 292 days.

The results are:

·         You have a 50% chance of selling you home in the average DOM.

·         If you add one standard deviation, you take the probabilities to 84%

·         If you add another standard deviation, it's 93%

·         Another standard deviation would elevate the probabilities to 96%, then to 98%, and so on.

What this means to you as a seller is that the statistical probability of selling your home in a few days is nil, and that in reality he should expect the process to take the average amount of time plus at least one standard deviation. Based on the illustration above, if this were your Market Area you have a 93% probability of selling your home in 292 days, using the typical pricing approach.

An experience agent is one of the most valuable tools in today’s real estate market.

Occasionally, a seller asks a real estate licensee to offer a property for sale in "As Is" condition. Sometimes that request simply reflects the seller's desire not to have to repaint a structure or to accomplish other basically cosmetic repairs. However, sometimes that request reflects the seller's desire not to be responsible for known material defects in the property.

Using such language as "This property is sold as is" in a sales contract will probably not relieve the seller and the licensee from responsibility for material defects. If such language relieves liability at all, it is likely to be only for those defects which the buyer already knows about or which are so obvious that a quick visual inspection of the property would make them apparent to the buyer.

Do not expect such "As Is" language to cover less obvious material defects or those which the seller or licensee have not specifically identified for the buyer. If litigation later arises over unknown defects, the courts are not likely to allow such "As Is" language to relieve the seller and/or the agent of liability.

What is the best way of handling such problems? A licensee would be wise to take at least two actions. First, the licensee should have the seller prepare a thorough Property Disclosure Statement disclosing all known material defects in the property. The licensee should give a copy of that statement to each prospective buyer at the time of showing the property and obtain a written receipt for it.

Second, the licensee should include language in the sales contract specifically disclosing all known material defects. For example:

The purchaser is aware of the following defects in the property and hereby releases the seller and the seller's agents from any liability on account of them:

1.      Rear wall of basement leaks when it rains;

2.      Electrical wiring in den does not comply with county electrical code;

3.      Fencing at rear of property encroaches on bordering property.

Such specific language is more likely to protect all properties than a general "As Is" provision. A licensee should actively seek information on known material defects, put the information about those defects in writing, make the language clear and specific, and be sure all purchasers or tenants acknowledge receipt of the information.

Who is already in the profession?

According to information from the National Association of Realtors' 2001 Member Profile Study, only seven percent of Realtors report that real estate was their first career.

Realtors tend to be former managers, salespersons, teachers, homemakers or administrators.

The average Realtor has 13 years experience, which supposes that many got into the profession at about the age of 39.

Who is the average Realtor?

The average Realtor is a 52-year-old female sales agent grossing approximately $47,700 annually.

Seventy-four percent of Realtors are married, with median gross household incomes of $92,800.

Eighty-eight percent of Realtors have some college education, compared to 51 percent of U.S. adults, according to the U.S. Census Bureau.

Nine out of ten Realtors own a home, and nearly half own rental properties.

Realtors with bachelors’ degrees earn 30 percent more than Realtors without a degree.

So what does this information tell you? That most Realtors have backup - and that is what you are going to need to make it in the industry.

Look at what the average Realtors have in common:

They have more education than the public

They have experience that comes with age

They usually have another wage earner in the household

They have enough wherewithals to own property and buy more property

Does that indicate an economic barrier for the entry level?

Yes, it does, and that could explain why people don't typically enter the profession out of school, or at least until their student loans are paid off.

In fact, the average age of Realtors has increased over 20 years; from age 42 in 1978 to age 50 in 2000, creating a crisis of youth in the profession.

Almost a third of brokers are 60 years old, and sixteen percent of brokers are over 60.

Only 12 percent of sales agents are under the age of 35, compared to 29 percent in 1978.

1.            Give people more than they expect and do it cheerfully.

2.            Marry a man/woman you love to talk to. As you get older, their conversational skills will be as important as any other.

3.            Don't believe all you hear, spend all you have or sleep all you want.

4.            When you say, "I love you," mean it.

5.            When you say, "I'm sorry," look the person in the eye.

6.            Be engaged at least six months before you get married.

7.            Believe in love at first sight.

8.            Never laugh at anyone's dream. People who don't have dreams don't have much.

9.            Love deeply and passionately. You might get hurt but it's the only way to live life completely.

10.       In disagreements, fight fairly. No name calling.

11.       Don't judge people by their relatives.

12.       Talk slowly but think quickly.

13.       When someone asks you a question you don't want to answer, smile and ask, "Why do you want to know?"

14.       Remember that great love and great achievements involve great risk.

15.       Say "bless you" when you hear someone sneeze.

16.       When you lose, don't lose the lesson.

17.       Remember the three R's: Respect for self; Respect for others; and Responsibility for all your actions.

18.       Don't let a little dispute injure a great friendship.

19.       When you realize you've made a mistake, take immediate steps to correct it.

20.       Smile when picking up the phone. The caller will hear it in your voice.

21.       Spend some time alone.