This market a ‘baby’ compared to days past

Johnson wasn’t always a real-estate guy. He was born to a farming family in South Dakota on Dec. 22, 1912, and moved to Seattle at the height of the Great Depression to attend college and pursue a teaching career. To make ends meet, Johnson juggled three jobs at one time. He delivered milk for a while. “Whatever you could do to get by with, you did it.”  Then, in 1936, he started dabbling in real estate. Unemployment hovered around 30%, soup lines stretched around blocks, homelessness was rampant. “You could have bought the best house in (the Seattle neighborhood of) Ballard for $3,500.” Times were tough. The current real-estate market, Johnson says, is “a baby” by comparison. “In addition to the Depression, we had the drought at the same period, so it was just compounded. You wouldn’t believe the things that happened during that period.” Johnson, a natty dresser who drives himself to work every day — including Saturdays – managed to carve out a niche as a service-oriented agent. When the economy turned at the end of World War II, he opened up his own shop in Ballard, north of downtown. He and his sons have run George W. Johnson Realtors ever since, weathering the ups and downs in the market with confidence that profits are there for the making.  “I’ve lost a lot of money in a lot of things, but I’ve never lost in real estate,” Johnson says. He remembers selling his first house in the 1930s for about $1,500. “It’s probably worth $300,000 now.”

4 real-estate tips from Johnson
You can’t thrive in the real-estate industry for this long without learning some useful lessons along the way. Here are some of Johnson’s pearls of wisdom:

Beware one-company towns: Cities dependent on a single company or industry are more vulnerable to jarring downturns if the economy goes south. The Rust Belt’s old factory towns have made that abundantly clear. The Seattle market turned particularly grim in the late 1960s and early ’70s when Boeing, the aerospace giant, laid off more than 60,000 people in the Seattle area. “Boeing was about the only major company we had other than (the University of Washington),” he recalls. “Now we’ve got a much broader base to help out … it is altogether a different proposition.” Johnson counsels homebuyers to look beyond real-estate values and investigate an area’s fundamental economy before making a purchase.

Don’t get greedy. Johnson blames “plain old greed” for the latest real-estate downturn — people got caught up in the enthusiasm of the moment and banks egged them on with cheap loans. “Everybody was out to buy a house, raise the price, double it and make a quick buck,” he says, shaking his head. “People signed up for stuff that they knew they shouldn’t have and they couldn’t pay (for) and of course the banks helped them.” Johnson is old-school in that way. At the heart of his real-estate philosophy is his fundamental belief in personal responsibility. “You’ve got to be able to hang onto a house until conditions are such that you can make a little money,” he says, emphasizing that each and every potential homebuyer should make an honest assessment of his or her financial potential and should be wary of offers that seem too good to be true. “People aren’t as dumb as the media is making them out to be. They knew what they were getting into,” he says. But he is compassionate for those who have run into honest trouble. “It’s tough on people who lost their jobs and are now losing their homes and that type of thing. It always is,” he says. Their pain, however, is the buyers’ gain.

Timing is everything. “In this market, any young person that hasn’t bought a house ought to buy one,” Johnson says. “A buyers market doesn’t come along that often … you just can hardly help but make money on whatever you buy today at the prices they are.” Johnson says rates are only going to go up over the long term, so borrowing will cost more.

If you don’t have to sell, hang on. Unfortunately, Johnson expects sellers to continue to suffer, at least for now. Buyers, on the other hand, “know it’s a buyers market – they are going to come in with offers below what we’ve appraised it at just because they know a lot of people have to sell,” he says. Despite the continued housing-market struggles, Johnson is confident that the latest downtrend is largely over. ”We are headed up,” he says, “but like I said, I think it is going to be slow. It will take a year or two at least.” And as the market heads up, Johnson hopes to be there helping his customers buy and sell homes just as he has for most of his life – out of a small, family office dedicated to service with a smile. “We’ve done a good job,” he says of his business. “We’ve been careful and honest and thorough and it’s been good service, and I think that will always produce, no matter what business you’re in.”

Read at: http://realestate.msn.com/article.aspx?cp-documentid=25369084&GT1=35006

Most people retire in the same town where they spent their final working years, but some seek out a new locale with ski slopes or perhaps ocean views. Of course, budget is a big concern. Many people move close by and move to a smaller home or condo where they have less upkeep. They still want to stay close to their children and stay involved in the business world by consulting and remaining close to their clients. Here are some tips for finding a place that fits your budget and interests.

Cost of living. Moving to a place with lower housing, food and entertainment costs is an obvious way to stretch your nest egg. A lower cost of living is the major factor behind retirement mobility. I don’t know anyone moving from Kansas to Hawaii. Twenty-two percent of Americans age 51 or older who moved between 1992 and 2004 did so to save money, according to a recent analysis by the Center for Retirement Research at Boston College.

Low-tax locales. Tax rates vary considerably by location. Seven states don’t levy an income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. New Hampshire and Tennessee tax only dividend and interest income. And five states have no sales tax: Alaska, Delaware, Montana, New Hampshire and Oregon. Be sure to evaluate property taxes and state and local tax exemptions for seniors.

Health care facilities. Your health care needs are bound to increase as you age. Make sure your prospective retirement spot has adequate health care and elder-care facilities and a doctor who can treat any condition you may have. You can call and see how difficult it is to get an appointment, if you’re on hold for more than 10 minutes or you leave a message on voice mail and you don’t get a call back, then you know.

Proximity to family. Many retirees would like to become more involved in their grandchildren’s lives. Living near family sometimes has another bonus: help with lawn care or transportation for grocery shopping — services for which you would otherwise have to hire someone. Twenty-eight percent of older Americans who have relocated after age 51 did so primarily to be near children or relatives, Boston College found. People often migrate toward someone because they have become more disabled or have lost their spouse and they need some support that they are not getting in their current location. They will move toward their children or some friends to help them with their daily life.

Recreation and culture. When you’re no longer tied to a job, you have the freedom to live in wine country or within walking distance of a beach. Perhaps your ideal retirement spot has plenty of art galleries, golf courses and hiking trails. College towns often fit the bill and host world-class speakers and entertainers, and they often have an affordable cost of living.

Public transportation. Retirees often reach a point when they can’t or no longer want to drive. Consider the cost and quality of a town’s public transportation system and how to get around without a car. AppalCart, a regional bus service in Boone, N.C., for example, provides free local transportation. Retirees who join the Senior Club in Walnut Creek, Calif., ($7 annual dues) are eligible for a minibus service that offers transportation within the city limits for $1 each way.

Weather. To some, it’s important to not have to shovel snow or defrost a car. But warm climates also come with the downside of larger air-conditioning bills. Think about whether you want four distinct seasons. Some retirees can get the best of both worlds by maintaining or renting a residence in the north and then heading south for the winter.

Read the entire story at: http://realestate.msn.com/article.aspx?cp-documentid=23626185