Real Estate Home Resales Up 2% in April

According to a survey conducted by Bloomberg News, Real Estate resales of home rose by 2% in April from March. Falling prices, tax credits, and low mortgage rates may be contributing to an increase in home resales. The rise in foreclosures also helped home resales. Foreclosed properties accounted for 50% of Real Estate home resales in March, including here in Lahaina on Maui. "Home sales are being boosted by foreclosure sales and that's helping to keep activity stable," says Celia Chen, an economist at Economy.com, a provider of economic analysis. Many analysts believe that the market is stabilizing. "Home sales and construction activity are probably at the bottom," said Chen. Robert Niblock, Chief Executive Officer of Lowe's Companies, a large retailer of home-improvement products, said in a conference call that "there have been some encouraging signs in recent weeks that suggest perhaps the worst is behind us. Consumer confidence has ticked up. Housing turnover, especially in certain markets, is showing signs of a bottom."  To see Maui, HI April Real Estate stats click on this LINK.

Real Estate Mortgage applications drop

According to the Mortgage Bankers Association, its index which tracks applications to purchase a home or refinance a loan dropped 14.2% in the week ended May 22, as compared to the earlier week. Requests for home loan refinance dropped 18.9%. While some believe the market is about to stabilize, housing analysts rule out the possibility of a sustained recovery unless unemployment goes down. Pete Flint, chief executive of Trulia, a real estate website, says, "The housing market is not going to recover until foreclosures stabilize and reduce, which is unlikely in the short run. I would feel a lot more hopeful for the housing market when I see some positive signs in the employment statistics." The unemployment rate in the U.S. is currently 8.9% and is expected to climb in future.

Irrational exuberance

The Standard and Poor index is up more than 30% since early March. With the economy not showing any signs of sustained recovery, the enthusiasm of the market could well be misplaced. In its latest budget projections, the U.S. government estimated that the economy will grow by 3.2% next year and by the year 2012, the growth will be 4.6%. Many analysts expect the economic growth to be lot lower. The economy has been bolstered by government spending. The question is what would happen if there is a reduction in government spending. Jeffrey Rosenberg, head of global credit strategy at Bank of America Securities Merrill Lynch, says, "When you remove the government stimulus, what the private sector can generate in terms of growth feels like a recession." According to Rosenberg it would take another 3 years before banks recover from credit crisis and during that period economic growth could be as low as 0.5 to 1%. When the economy grows at a rate as low as 1%, it is susceptible to ex ternal shocks such as rise in the price of oil. History suggests that when recession is caused by financial crisis, it takes a lot of time for the economy to recover.

Consumer confidence grows

Data released by The Conference Board, an agency which carries out economic research, suggests that consumer confidence is on the rise. The index of consumer attitudes, published by The Conference Board, jumped to 54.9 in May from 40.8 in April. This is the biggest one-month jump since April 2003. Analysts believe that the jump in the index is an indication of "less of bad news." Lynn Franco, director of The Conference Board's Consumer Research Center, says, "Consumers are considerably less pessimistic than they were earlier this year." Less of pessimism doesn't exactly denote optimism. The consumers covered in the survey for collecting index data offered mixed response with regard to their purchase plans. The proportion of consumers planning to buy a car in the next 6 months rose to 5.5%, the highest in the last one year. But only 2.3% said they intended buy homes.

General Motors inches closer to bankruptcy

The large majority of bondholders of General Motors (GM) have rejected the company's offer to trade their $27 billion bonds for a 10% stake in the company's stock. This effectively negates the possibility of GM's debt restructuring plan, and pushes the company closer to bankruptcy. Some believe that GM's bondholders are likely to get a worse deal if the company files for bankruptcy. It looks highly likely that the U.S. government will increase its planned stake from 50 to 70% in GM, in order to reduce the company's debt burden. The bankruptcy, if and when it happens, will be among the largest and the most complex in the history of American industry.

Now on to our real estate investor education tips section...

Is Your Body Language a Barrier to Short Sale Success?

Let's face it - everyone is prone to the occasional sigh or less than enthusiastic response especially when dealing with complex or challenging people. Unfortunately, short sale investors must learn how to successfully negotiate with sellers, lenders and others in order to put together the best deals - no matter how positive or negative you feeling are - it's important to keep your body language under control. Learn how to identify - and correct - the most common body language barriers holding back your success:

Off the Top of Your Head...did you realize that most people tend to look upward in a diagonal position when trying to think of an answer? It's true - and others are able to pick up on that almost immediately. Stay prepared to avoid negotiating by the seat of your pants.

X-Marks the Spot...crossing your arms is often associated with a defensive posture. Rather than attempting to fix it (which is likely to only make you appear even more uptight), simply learn how to calmly communicate what you don't like about the current conversation. Practice using a relaxed voice and your body language will follow suite naturally.

Ahead of the Crowd...overt enthusiasm and gestures that display a sense of urgency can be a dead give-away. Learn how to demonstrate a calm demeanor even when excessively excited. If you are absolutely unable to curb your enthusiasm, put it into writing instead. Think of it like a poker game - and keep your cards to yourself.

I Can't Believe my Eyes...rubbing eyes or constantly turning your face away or indicates doubt and disbelief. Stop and allow the information to sink in slowly or ask questions rather than showing serious doubt or disbelief. It keeps the lines of communication open rather than putting the other party on the defensive.

Nervous Habits...biting nails, tugging at the corner of something, fidgeting with a pen and other time consuming habits either indicate boredom (if they are performed slowly) or impatience. Either one sends the wrong message. Keep track of what nervous habits you tend to display and rather than trying to eradicate them - replace them with something positive instead.

Ask a friend or family member to point out your most common body language pitfalls then make a point of developing successful forms of physical communication. For example, a brisk erect walking manner that portrays confidence or an open palm resting in a relaxed manner when speaking (sincerity, openness). Use "steeple fingers" when negotiating (authority) and a tilted head when listening to others (interest). Film yourself and practice until it becomes second nature. ...but most of all, learn how to feel comfortable in your own skin.

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