Are Unemployment Rates Good or Bad for Interest Rates?

Last Friday, November 3, 2006, the Department of Labor released the new unemployment figures which fell to 4.4%. This number represents an increase in jobs in the nation overall. The economy is doing better and better each day. In fact the Unemployment rate was almost 6% in 2004 and has steadily declined (more people going to work) each year. Now here is the interesting part of the story. The current interest rates are artificially low to encourage people back into the housing market. The Fed is concerned that with more people now working more homes will be bought so they will naturally try to fiddle with the interest rates. That is exactly what we saw happen on Friday. Rates were all over the map. So if you are a buyer now is the time to get into the market before rates go higher. Unemployment is a GOOD thing, just remember that with all market economies, the more people that want a particular item, in this case interest rates, the market will drive the price of that "thing" that they want upwards. This is a classic market force at work.

My Carpet is not That Bad!

"I will let the buyer pick the carpet, after all what ever I choose they may not like!" So said a seller once to a Realtor. The response that the seller received was priceless. "If you're planning on orange shag then I would have to agree with you, but let's pick a color that 95% of the buyers will want." Amen! What I have learned over the past 20 years of selling homes is that what sellers are really saying is "I don't want the hassle of putting in new carpet." That is a fair answer. But let's take a look at this in detail. Most buyers, especially in today's market, do not want the hassle either. If the buyer has to go through this process they want to be compensated at the Seller's expense. So a wise Seller will re-think this and find a carpet that 95% of the buyers will want. So how do you do that? Well the first step is to consult with a Realtor who knows something about colors and what's in and what's not or get the opinion of a good decorator. Why spend needlessly on the wrong color and carpet when you can get maximum bang for the dollar with the right carpet. This does make a difference for buyers believe it or not. As long as you are replacing the carpet, why not consider putting a fresh coat of paint on the walls and ceilings if need be. If you are not a painter or do not like to paint, please do not do this by yourself. Do-it-yourself painters hurt their cause. I have been through too many homes that have paint on the trim, around doors and splotched on the ceiling. This is a real turn-off for buyers. Always check with a professional about any changes you are going to make to your home before you proceed. A good Realtor can save you lots and lots of time and money.

Have we hit the bottom?

The media is full of reports today that real estate has not hit the bottom and we are in for a few more months of declining prices. Well that may be the case for parts of the country (the coasts) but for the stable Midwest this is the bottom. The irony is this. For the past 5 months the local Realtor community knew of the precipitous slide in prices and we tried to convey that to our sellers. Some listened and preserved their profits, while others insisted that we were 'trading in fear'. That was hardly the case at all. We look for indicators in the market that will give us clues as to what the 'market' will and will not do. A classic example is showing activity. Over the past several months--a usually good time in real estate, the showing activity was slowing quickly. Was it because of interest rates? No, those are still low. How about the oversupply of homes? Yes, that was it. Some sellers are beginning to realize that we were in a price slump. It is better to realize it at some point then not at all. On the other hand many of today's buyers are still under the impression that the prices will fall even further, using national data as their support for this position. What they will realize this spring is that the bottom was indeed in the fall of '06--the best time to buy, and that the spring '07 market will not yield as many great deals as the 4th quarter of 2006. The real winners are those who look ahead, plan and take decisive action. So, have we hit bottom? Yes that happened a few weeks ago. We are now moving forward.

Squirrels & Ice Makers

I was startled to discover that there are two items that all home insurers will not cover which could add up to big dollars. Not completely convinced that I was correct I then asked a good friend of mine who is in the business and he was startled too! How did these get by me and possibly you too. The first item is "Squirrel" damage. Let's say you leave for an extended period of time and while you are away a squirrel manages to get into your home. Can you imagine the damage that little critter will do trying to find his way out. Insurance companies will not cover for the little beasts who have a one way ticket to destruction in your home. Now the odds of this happening are very very slight, but nonetheless Squirrels are not covered.

The next item is interesting. If you have an ice maker in your refrigerator chances are the line that feeds that ice maker is plastic. If it leaks it is generally a slow leak which left unchecked, could cause damage your floor under the refrigerator before you notice it. This is not covered under all insurance policies. A good idea is to replace that plastic tubing every 8-10 years. If you have copper you're in good shape, but it is worth an inspection from time to time.

Squirrels and ice makers now have something in common.

Cold Weather is Approaching--Tips

With the heating season just around the corner it is wise to have your furnace technician do a regularly scheduled cleaning and inspection. While they are there, have them replace the furnace filter (it's usually recommended to do this twice a year) and perform a CO test. Carbon monoxide is a typical problem on some older forced air furnaces. If you do not have a good CO detector, they are a good investment. You can purchase one of these from your local hardware store. I have my furnace checked and cleaned twice each year, once in late spring and once in late fall. An ounce of prevention is well worth it. If you have a recommendation on a good CO detector let us know about it.

The one that got away

I was talking to a friend of mine the other day who was fishing off the pier on Fowler Lake. He was not having any luck with the fish so he thought "I will just finish up with this last worm and then I am gone." Just then he saw a small fish start to nibble on his bait. Thinking that this would not last long he continued to hang out as the sun started to set. Just then the little fish took a bite of the worm. Knowing full well that the fish was not of a legal size he thought he would reel the little guy in and release him. Just then a lunker appeared and as he was pulling the little guy out of the water the lunker lunged up out of the water and grabbed what now appears to be bait for the bigger fish. The little guy didn't make it. The worst part of this story is that my friend had no one there to witness this event. I believe him though.

Oconomowoc is ready to move up

Little Oconomowoc Wisconsin, once the quiet rural community west of Milwaukee Wisconsin was known in the late half of the 20th century as the "Newport of the Midwest". The beautiful terrain dotted with tranquil blue lakes this small community boasts many a large 'lake cottage' for the wealthy. Well things managed to stay the same for quite some time until now. Houses now dot the landscape and the need for shopping and activities dominate the requirements for those living in and around Oconomowoc. Pabst Farms is now a reality with homes everywhere and a new mall is now in the planning stages with the City. What does all this mean to the local residents. Well with any growth some like and it and others do not. Let's look at the glass as half full rather than half empty. We will have more opportunities for shopping and entertainment than we have ever had in the past. When we moved here 20 years ago the closest place for entertainment was Brookfield or downtown Milwaukee. I personally do not want to drive 30-40 minutes each time I want to see a movie or dine at a nice restaurant. So we have much to be thankful for. Growing pains are just that. It happens and we all move on. The best part of a city like Oconomowoc is that all the voices are heard. We live in a great city!