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Tom Koziol

Housing

Foreclosures and Mortgage Delinquencies: A Tale Of Opposites

by Tom Koziol | November 20, 2009
Thumbnail image for Foreclosures and Mortgage Delinquencies: A Tale Of Opposites

Today’s news seems to bring us a tale of opposites every time they report on the real estate market as it exists at this point in time. For example, an article by the AP just the other day said “the pace at which people fell behind on their mortgages slowed during the summer for the [...]

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Commentary

The Health Care Bill and Real Estate Investors / Professionals

by Tom Koziol | November 6, 2009

At first blush, these two seem like polar opposites. After all, what does the proposed health care bill being ballyhooed have to do with real estate investing?
I will readily admit I haven’t read the 1900 plus page bill but I have a friend who did. I won’t tell you about the number and size of [...]

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Selling Real Estate

Real Estate Auctions: Going Once, Going Twice . . . .

by Tom Koziol | October 30, 2009
Thumbnail image for Real Estate Auctions: Going Once, Going Twice . . . .

While once never used to sell real estate in the amount and quantity that is business du jour today, this method is becoming ever more popular. I am not talking about the auction process that takes place on the court house steps. I’m talking about auctions that sell homes by the boat load.
Most auctions are [...]

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Commentary

A Quiz You Can’t Fail: How Will You Make Money in Real Estate

by Tom Koziol | October 23, 2009

As everyone knows, the real estate market is in the tank – at least that is the overall perception. On the other hand, we all have heard that there are people who are still making money in real estate. At least they say they are.

If it is true that people are making money, here is a quiz that should be a no brainer. By the way, this quiz won’t be graded. Not by me at least. You may decide to give yourself a grade just for grins.

The Setting

Lets say you live in a housing market that has been described by a national real estate forecast service as the country’s “weakest housing market.” It is projected to have the biggest decline in value in the next 12 months among all housing markets in the nation with a 12 percent median price dip for both new and existing single-family homes.

In making its determination, the forecast service looked at 260 metro areas using more than 50 variables, including housing supply, population trends, unemployment and inflation. And, speaking of unemployment, your area has just seen a full one percent spike upward.

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Commentary

Dolphins And Real Estate

by Tom Koziol | October 16, 2009

Let me pass along a story that has extreme relevance to our current real estate picture. It involves dolphins in the Gulf of Mexico and their feeding by well meaning – although some would say misguided – people called tourists.

This story was relayed to me by a friend who used to vacation in Mexico and enjoyed boating in the Gulf. He said that a few years ago dolphins would swim up beside the boat and almost leap in to get their free meal. It seems feeding the dolphins became the thing to do.

The last time he went out he noticed not a single dolphin would swim up to the boat. Being the curious type, he wondered what had changed.

When he pulled back onto shore, he asked the locals why the dolphins wouldn’t approach his boat. The answer totally stunned him. He was told the government had outlawed feeding dolphins and included a $10,000 fine for anyone caught feeding the dolphin.

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Commentary

Redirected Dollars: Not a Bad Way to Start Investing

by Tom Koziol | October 9, 2009

I had a brainstorm the other day. Hopefully, it will catch on like wild fire and people all over this country will enjoy the prospective windfall benefit.

It all started when one of our clients said how tough it was for her to come up with her auto insurance premium every month. Nevada requires car owners to have a certain level of coverage. The state doesn’t give a darn how hard it is to come up with the premium. My idea solves this particular dilemma.

Just for the record, in Nevada, the minimum required coverage is 15/30/10. The minimum required coverage may be different in your jurisdiction. Regardless, the requirement is still there which means it has to paid for one way or another. Almost like a forced mortgage one could say.

Before you ask what does this have to do with real estate, indulge me and keep reading. It has a lot to do with putting your mitts on investable dollars.

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Real Estate

Bar Stool Economics

by Tom Koziol | October 2, 2009

You may have already seen this particular economics propoundment but, then, maybe you haven’t. It is making the round of the Internet. I decided to use it because it hammers the real estate debacle square on the jaw.

For whatever reason, the government decided to beat up the tenth man leaving the rest of us with what appears to be only one way to go. Of course, your interpretation may not parallel mine. So be it.

Start—

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the
way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

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Commentary

The New Real Estate Niche

by Tom Koziol | September 25, 2009
Real Estate
Image by Thomas Hawk via Flickr

After you read this post you will realize the “new” is really the “old” but, in the end, who cares. At least according to me.

We’ve all seen headlines that read: Existing home sales dip in August or words to that effect. Truth is, those headlines aren’t news anymore. They used to be but used to be has become the norm or maybe I should say the numb.

To add more numb to this post, we all have read articles telling us real estate practitioners and investors are expressing frustration with what they consider slow action from banks. That is, banks aren’t releasing inventory fast to satisfy the demand.

My question boils down to what do they really expect from institutions that have moved, on a historical basis, extremely slow. It is merely business as usual.

On the other hand, given a red-hot market has poked its head out of the ground we should expect business not to be usual. We should demand those institutions with a home inventory to get off their duffs and start moving the product. A home is no different than any other retail product, other than the sales price. When demand flares up, release the inventory and satisfy the demand.

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Commercial Real Estate

Commercial Real Estate: The Iceberg is Melting Faster!

by Tom Koziol | September 18, 2009

This isn’t a global warming post in any sense of the phrase. Unless, of course, it is your bank account that is melting away faster than you care for it to melt away. This post is a kinda-sorta extension of last week’s post in which I said a new wave of foreclosures is in the immediate future.

My statement was based on the commercial real estate market and lo and behold the very next Monday, Corus Bancshares Inc. was seized by the Feds. As it turns out, CBI financed a 377 unit condo called The Montage in downtown Reno. Several years ago the latest craze to hit this city was to take shuttered casinos – yes, casinos go belly up – and convert them into condo complexes.

This particular complex had units priced from $150,000 to more than $1 million. This was during the high flying years. Today these same units won’t fetch $10,000 no matter where they are located in the complex.

My youngest son was in the market at about that time for a dwelling. He liked the idea this complex was only two blocks from his job and he could walk to work even in the dead of winter, and not freeze before he got there. I went along to see what was worth $1 million.

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Commentary

Our World Has Rolled Over

by Tom Koziol | September 11, 2009

I realize I am not the only guy on this planet who reads the “news” as presented both in the newspapers and on the Internet. Even if I didn’t read the news, I’d get a good dose of what people are calling reality. That dose comes from the mix of clients our insurance agency serves. Lucky me…

Here are two sentences taken from two separate news stories:

“The coffers of the Federal Deposit Insurance Corp. have been so depleted by the epidemic of collapsing financial institutions that analysts warn it could sink into the red by the end of this year.” – AP

“Pending U.S. home sales rose more than expected in July to the highest level in more than two years as first-time buyers rushed to take advantage of a tax credit that expires this fall.” – AP

Is it me or are these two sentences sending conflicting messages. If it is me, I apologize upfront. However, I don’t think it is me.

Failure Ahead

According to published reports, so far this year, 81 banks have failed. Last year only 25 went down the toilet while in 2007, if you’re counting, only three went south. These same sources project hundreds of more banks are expected to fall. The primary reason given is due to souring loans for commercial real estate.

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Commentary

Social Security And Compound Confusion

by Tom Koziol | August 21, 2009

Seal of the United States Social Security Admi...I didn’t know the particular piece of information you are about to read until I read an article in which the writer’s social security number was compromised by none other than the Social Security Administration. It all happened because U.S. Territories issue their own social security numbers and a U. S. agency had made a loan.

In fact, the Federated States of Micronesia, the Republic of the Marshall Islands and the Republic of Palau all have their own Social Security Administrations. The only difference between the numbers is the mainland issues 9 digit numbers and the Territories issue 8 or 7 (Palau) digit numbers.

The fun starts when one of these numbers is entered into a computer. It appears mainland computers are trained – programmed – to add a zero or two zeroes to fill in the eighth and ninth spot. But it doesn’t put the zero(s) at the end or what we would call the ninth number. It puts it/them first.

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Commentary

Free Houses and Keeping Your Rental Property Rented?

by Tom Koziol | August 14, 2009
Pomerode
Image via Wikipedia

Those are the words I entered into a search engine because I was interested in obtaining a house for free. I could not think of any other way to find one so I resorted to the Internet. If you want to try it, be prepared for some slapstick findings.

I tell you this upfront so you won’t be disappointed with what pops up on your computer. I went to one site where the person was selling a book on “free houses” but failed to put even one buy button on the sales page.

His idea sounded plausible but seeing this huge faux pas I assumed his material was less than worthless. I don’t know that for sure since I couldn’t buy his book to read, because he doesn’t allow anyone to buy it.

I did find a budding entrepreneur who offered free homes to anyone who agreed to abide by some, what I consider, draconian conditions. They weren’t very clear on the extent of the freeness, ie, I couldn’t tell if the offered homes were really free and clear to anyone who did abide by the conditions because all they mentioned were the conditions.

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Commentary

Health and Life Insurance: Two Policies – Two Different Needs (slightly off topic of RE)

by Tom Koziol | August 8, 2009
New York - Metropolitan Life Insurance Company...
Image by Marionzetta via Flickr

I am keeping my insurance agent hat on today so I can talk about two different types of policies of which your average American should be aware. While insurance is as dull as dishwater to some, to me it is exciting because of the potential benefits that can happen for you and I, the end user.

I thought I’d talk life insurance out of the gate. Why life insurance out of gate you may ask. Because in case of death the bank pays you what you have saved, and the life insurance company pays you what you meant to save.

No matter how much money you accrue in real estate, stock market, or any other type of investing, life insurance is still the only product that offers tax free dollars. You can look that fact up in the IRS Code for verification. Truth is, trusts and other asset protecting documents generally use annuities or life insurance policies to keep the dollars safe from the taxman and other predators.

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Commentary

An Investment Alternative To Consider

by Tom Koziol | July 31, 2009

Today I have put on my insurance agent hat and will talk about what I believe to be a good place to invest not only your retirement but spare cash. You can even be retired and get one heck of a deal with this product.

I am talking about the good ole annuity that has had its reputation tarnished but is on its way back to being the star it should be. Because annuities come in a variety of flavors, ie, fixed, single premium immediate income, variable, etc, I’ll stick only to the virtues of fixed and single premium annuities.

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Commentary

Debit Cards Can Be Bad Investments

by Tom Koziol | July 24, 2009

This post may sound like heresy to the died-in-the-wool debit card user. However, if you put the same overview on debit cards you do to other investments, you may agree with me. After all, it is YOUR money at risk.

I fully realize debit cards have overtaken credit cards as the plastic du-jour for Americans. The ratio is something like 2 to 1 meaning for every credit card used, two debit cards are used. Don’t hold me to this as a concrete figure as the numbers are a little over a year old. But, they are very close to accurate.

I also fully realize how easy it is to use a debit card. I watch my wife at the grocery store check out counter. Fast, easy and convenient to say the least. I don’t own one so all I get to do is watch. Oh, she also uses her card at two restaurants when we go out to dine. (More on why this is a bad idea later.)

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