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Jun. 27, 2009 - The Brentwood Neighborhood of Austin

The neighborhood of Brentwood in north central Austin was originally a cotton farm until about 75 years ago, when the City of Austin annexed the land and land was purchased to build a school, Brentwood Elementary, which opened in the early 1950s. Brentwood is the name used to refer to the area of Austin between Lamar, Justin Lane, Burnet Road and 45th Street, and the school is in the middle of the neighborhood. There is also a tree-lined street called Arroyo Seco which runs through the middle of Brentwood and divides the neighborhood in half, forming what are jokingly referred to as Northern Brentwood and Baja Brentwood.

The median household size is smaller than average in Brentwood than most in Central Texas, at 1.9 people per household on average, and the demographics of the Brentwood neighborhood suggest a professional population of the age group most likely to be employed, with 45% of the residents being between the ages of 25 and 44; in addition, 50% of the homes in Brentwood are occupied by a single adult, many of whom are professionals in the high tech industry or U.T. grad students and professors.

There is a smaller percentage of school age children in Brentwood than most neighborhoods in Austin, and most of the residents of the neighborhood are slightly older than average, with 86% of the residents being over the age of eighteen, yet only 17% reporting being over the age of 65.

74% of the residents in Brentwood report Caucasian ancestry, with about 20% reporting ethnicity including both Hispanic and Caucasian roots, with the remaining population being comprised of a variety of ethnic backgrounds, so Brentwood has a fairly diverse population as well.
Students who attend school in Brentwood go to Brentwood Elementary, Lamar Middle School, or McCallum High School, and 95% of those who are employed in Brentwood work within Travis County. The median family income in Brentwood is around $47,000, and the residents are well-educated, with 57% having a college degree and 28% currently reporting working on their graduate degrees.

Since the University of Texas is in close proximity to the neighborhood, there are numerous housing opportunities for students, professionals, and young families, with a plethora of new condominium projects and apartment complexes as well as many single family homes. The average price of a home in Brentwood was about $170,000 in 2003, with the higher end of home prices being around $385,000. This is roughly about average for the Austin real estate market. Home values have risen dramatically in the area since the closure of Mueller Airport, since the flight paths of planes travelling to and from the field are no longer directly over the homes in the area, eliminating a great deal of the noise.

Brentwood is a very scenic area with a creek meandering through most of the neighborhood,along Arroyo Seco,and the neighborhood is known for old-fashioned hamburger joints and taverns, as well as the farmer's market, which has been in operation since 1947. At one point, the Stallion, Frisco Shop, and Threadgill's all offered a down-home chicken fried steak or juicy burger with home made fries in or very near the neighborhood, for a workingman's price.

There is a large, peaceful park in the neighborhood, Brentwood Park, which included nine acres of green space along with tennis courts, hike and bike trails, soccer fields, a baseball diamond and a playscape. There is also a festival called the Violet Crown Festival which is held on the lawn in Brentwood Park every year, and the neighborhood takes pride on its lights and decorations during the holiday season, especially on Arroyo Seco.

There are many churches and institutions, as well as city and state facilities in Brentwood, with choices of Faith Lutheran, Austin Bible, and Crestview Methodist Church for churchgoers, among many others, and some of the facilities in the neighborhood include the Texas School for the Blind, the Texas Department of Health, and the Austin Community Gardens, where residents can grow their own fresh produce.

For dining out, residents and visitors can choose between the Korea Garden, Fonda San Miguel, Phil's Icehouse, the Omelettry, and Jalisco, all of which are in or very near the Brentwood area, as are quite a few other restaurants and clubs, as well as fast food joints.

Brentwood offers something for everyone, and with its scenic beauty and history, yet urban, hip reputation, it is the perfect place to just visit or move in and settle down!


Ki works as a real estate agent in Austin Texas. His site is filled with information on the Austin real estate market. It also provides information on neighborhoods like Brentwood Austin along with a search of the Austin MLS.
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Jun. 27, 2009 - Mortgage Math : Financial Advice in an Uncertain Economy

The national savings rate is up to a 15-year high and more Americans are getting serious about getting out of debt, rather than spending beyond their means. When staring down a pile of debt that includes mortgage, credit cards and school loans, the question becomes: Where to begin?

One way to pay down debt that appeals to many people is making an extra mortgage payment. The math seems almost irresistible when looking at the amount of money that can be saved over the life of a mortgage loan by making extra payments. For example, paying an extra $100 a month on a $250,000 mortgage at 6 percent saves over $50,000 and pays the loan off a few years early. That's a smart thing to do, right?

Not necessarily, says MSN financial analyst Liz Pulliam Weston. "Most people still have better things to do with their money, even in this economy, than to pay down a low-rate debt that's often tax-deductable to boot."

Weston points out that if someone is carrying credit card debt, say at 12 percent, every dollar put towards paying off that debt earns an instant 12 percent return. That is a great return considering the hit most retirement funds have taken over the last year and home values are shaky these days. Even a one-year certificate of deposit only averages around a 2 percent return.

A 2007 study found that an estimated 16 percent of American home owners pay extra on their mortgage. But that might not be the smartest use of funds. Financial planners all sing the same tune when it comes to paying off debt: tackle the debt with the highest interest rate first.

The debt with the highest interest rate is usually credit cards. Financial guru Dave Ramsey suggests trying a debt snowball. He instructs people who want to pay down their credit card debt to make a list of all credit card balances and then tackle the smallest balance first. Like the snowball that starts small and gains girth and speed as it rolls down hill, Ramsey touts the psychological benefits of watching the number of balances diminish along with the total dollar amount.

If credit card debt is not an issue, paying down the mortgage still may not be the smartest financial move. Unless retirement is right around the corner, using extra funds to invest in a retirement fund will give a greater return on that money. One study found that most people who make an extra mortgage payment each year would have gotten 11to 17 cents more on the dollar if they had invested in a 401k instead.

Should you pay down the mortgage or invest in the stock market? "Even with the recent turmoil, over the long term your money can earn better returns in the market compared with paying off low-rate debt. Based on historical returns, a mix of 60% stocks, 30% bonds and 10% cash would earn an average of more than 8% a year in most 20- to 30-year periods, according to market researcher Ibbotson Associates. You may doubt we'll ever return to the days of positive returns in the stock market, but we will," says Weston.

In these times of economic uncertainty, building an emergency savings plan is also a smarter thing to do than making that extra mortgage payment. Most financial planners suggest having enough in savings to cover at least three-months' expenses, and the smarter safety net is six months' of expenses in savings. While the paying-down-the-mortgage math seems sound, double check the numbers before writing that check.


Ki works as a realtor in the Austin real estate market. His site has a search of Austin homes for sale It also provides information and statistics on Austin real estate and Pflugerville real estate.
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Jun. 27, 2009 - Austin Summer Fun on a Budget

Perhaps it's all those years of summer vacations from school, or maybe the heat just makes it harder to focus on work. Whatever it is, there seems to be an inherent need to have some fun during the summer months. Here are some ideas for having an entertaining Austin summer without blowing the budget:

Restaurants
There is something about a sultry summer night that makes people want to find a fun restaurant with a patio and order some chips and salsa. Fortunately, Austin is neither lacking in great restaurants or great deals on eating out. Whether it's the free nacho car offerings at Chuy's happy hours or the $2.99 meal deal at Bill Miller Bar-B-Q, cheap food and drinks abound in Austin. Some great patio spots that offer terrific food and prices is Doc's Motorworks on Congress Avenue and El Arroyo on Fifth Street.

There are also some upscale options that are budget friendly. The trendy French restaurant Aquarelle on Rio Grande offers half priced dishes off the bar menu in its wine bar or on the patio. Enjoying a nice glass of white wine and a plate of mussels makes feeling cosmopolitan a great bargain. Or, head to the up and coming Olivia on South Lamar on Sundays and Mondays for discounted food and drinks from the bar menu. McCormick & Schmick's offers incredible happy hour deals every day of the week and Sullivan's Steakhouse is the place to go on Thursdays for half-priced bar entrees and cigars along with $5 martinis.

Entertainment
The summer months also offer some cheap and interesting places for watching movies. Deep Eddy Pool has Splash Party Movie Nights on Saturdays at dusk throughout the summer. Many of the city's libraries offer free movies throughout the summer and Alamo Drafthouse has a free
Kids Camp movie every weekday at 11 a.m.

There is also the Zilker Hillside Theater, which is presenting The Music Man this summer. Shows run July 3 through August 15, Thursday through Sunday starting at dusk. Also, there is nothing as American as a beer and hot dog at a summer baseball game. The local minor league team, The Round Rock Express is a great family outing that won't break the bank.

Outdoors
The Austin area has an abundance of swimming holes that offer a chance to cool off and commune with nature on the cheap. From the centrally located Deep Eddy and Barton Springs Pool to Hamilton Pool and Blue Hole in the Hill Country, there are enough places to try a new one each week of the summer. For the kids there are free splash pads in Butler Park, The Hill Country Galleria and Brushy Creek Lake Park in Cedar Park.

Family Fun
For some fun family mini-vacations, there is Schlitterbahn Water Park in New Branfels, as well as Sea World in San Antonio. While these are not necessarily cheap outings, they do offer a vast array of entertainment for the ticket price. Consider that it is far cheaper than airline flights and hotels and probably just as much fun as a big vacation.


Escapesomewhere Real Estate is a small real estate company in Central Texas. His site has information on Austin Texas real estate. It also provides a free graphical search of the Austin MLS and a blog covering market updates for the Austin real estate market.
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Jun. 27, 2009 - After Falling Mortgage Rates Hold Steady

After falling from 5.59 to 5.38 the previous week it looks like mortgage rates for the most part held steady this week. Of the four major mortgage products two fell and two rose. But for all four the movement was minimal. Thirty year mortgage rates rose from 5.38 to 5.42 and the 5 year arm rose from 4.97 to 4.99. The 15 year rate dropped slightly from 4.89 to 4.87 and the 1 year arm fell from 4.95 to 4.93. Below are rates for the last few weeks.

Jun 25, 2009
30-yr 5.42 15-yr 4.87 5-yr ARM 4.99 1-yr ARM 4.93

Jun 18, 2009
30-yr 5.38 15-yr 4.89 5-yr ARM 4.97 1-yr ARM 4.95

Jun 11, 2009
30-yr 5.59 15-yr 5.06 5-yr ARM 5.17 1-yr ARM 5.04

Jun 04, 2009
30-yr 5.29 15-yr 4.79 5-yr ARM 4.85 1-yr ARM 4.81

May 28, 2009
30-yr 4.91 15-yr 4.53 5-yr ARM 4.82 1-yr ARM 4.69

Dec 24, 2008
30-yr 5.14 15-yr 4.91 5-yr ARM 5.49 1-yr ARM 4.95

So while the 30 year rate has dropped from its recent peak of 5.59 on June 11, 2009 we are still up from the extremely low rates we saw in May. One interesting thing to note is that in the last 6 months 30 year rates have increased from 5.14 to 5.42. On the other hand 5 year arms have dropped from 5.49 to 4.99. Even with these changes I would still look for fixed rates over arms. There is a good chance that rates could be much higher in a year or 5 years when the arms would expire.

In addition to rates we also like to look at actual mortgage payments. Using our mortgage calculator we took rates from this week and converted them into a mortgage payment on 200k loan. We also did the same thing with rates from June 18th and from December 24th (6 months ago).

Jun 25
30-yr $1125.55
15-yr $1568.07
5-yr ARM $1072.42
1-yr ARM $1065.1

Jun 18
30-yr $1120.56
15-yr $1570.15
5-yr ARM $1069.97
1-yr ARM $1067.53

Dec 24
30-yr $1090.82
15-yr $1572.22
5-yr ARM $1134.32
1-yr ARM $1067.53

So as we can see the movement in the last week is minimal. Compared to 3 months ago a mortgage payment today would be $34.73 higher or 3.18 percent. Even though mortgage rates are higher than what they were before current rates are still low by historical terms.

Mortgage rates only provide part of the picture for how the lending environment is affecting the real estate market. The other part is that lenders remain very strict in their policies on when they will give out loans. So lenders are offering loans with low mortgage rates but they are not offering them to everyone.

This of course is having a serious dampening effect on the real estate markets potential recovery. Freddie Mac is particular is enforcing a number of new rules. While the government has spent significant resources on keeping mortgage rates low and easier and more effective method to help the real estate market would be to look through Freddie Mac's loan restrictions.

Ki is a realtor in Austin Texas. His site is a resource on Austin Texas real estate. It also provides a mortgage widget along with mortgage calculator code
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Jun. 19, 2009 - Is the President's Economic Plan Just Stimulating Conversation?

Somewhere, somehow 600,000 jobs are going to be created and/or saved by the end of summer. In fact, the White House announced recently that 150,000 jobs have been saved in the last few months. Maybe it was yours; maybe it was mine. The problem is that all this job saving is a little difficult to pin down.

President Obama announced recently that this summer will see a ramping up of spending from the $787 billion stimulus fund and create or save 600,000 jobs. According to the Associated Press, the President spoke to his cabinet about "modest progress" in the economy. In particular he cited that fewer jobs were lost last month than expected. There have also been some admissions from this administration that their original economic forecasts made at the end of last year were too optimistic.

"At the time, our forecast seemed reasonable," said Vice President Joe Biden's top economic adviser, Jared Bernstein, explaining that the White House underestimated the scope of the recession.

By the White House's earlier estimates the nation's unemployment rate should be about 8 percent, not the 25-year-high 9.4 percent. It seems everything is on the rise these days from the President's un-approval rating for how he is handling the economy to gas prices to the national deficit.

But the Obama administration is trying to make things better. According to Recovery.gov, in the next 100 days the American Recovery and Reinvestment Act will save or create jobs in the following areas
* Department of Health and Human Services -- Enable 1,129 health centers in 50 states and eight territories to provide expanded service to approximately 300,000 patients
* Department of the Interior -- Begin work on 107 national parks
* Department of Transportation -- Begin work on rehabilitation and improvement projects at 98 airports and at more than 1,500 highway locations throughout the country
* Department of Education -- Fund 135,000 education jobs, including teachers, principals and support staff
* Department of Veterans Affairs -- Begin improvements at 90 veterans medical centers across 38 states
* Department of Justice -- Hire or keep on the job approximately 5,000 law enforcement officers
* Department of Agriculture -- Start 200 new waste and water systems in rural America

The government will also be flush with money in the weeks ahead as ten banks have been given permission by the Treasury Department to repay money they received from the government bailout of the banking industry. According to the Associated Press, $68 billion of the nearly $200 billion Troubled Assets Relief Program funds will be returned from banks such as JP Morgan, Goldman Sachs and American Express.

There are other signs that the economy is slowly starting to improve. Granted most of the good news is really in the category of less-bad-news, but job losses are down, the economy is sinking at a lower rate and consumer confidence is starting to return. What is nearly impossible to track is if the improvement is a result of government intervention or just a part of the economic cycle.


Ki bikes Shoal Creek when he is not working. He has focused on real estate since graduating. His website is focused on Austin Texas real estate, where future owners can search for listings in the Austin MLS. His website has a blog devoted to Austin real estate with current market stats and information.
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Jun. 19, 2009 - After 2 Weeks of Large Increase Mortgage Rates Fall Again

So for the previous two weeks we saw sizable gains in mortgage rates. Between May 28th and June 11th 30 year mortgage rates jumped from 4.91 to 5.59. This week we saw rates drop down to 5.38. Although we are still above what we were at two weeks ago it's nice to see mortgage rates moving back down. The other major mortgage products all went down as well. The 15 year dropped from 5.06 to 4.89. The 5 and 1 year arms dropped from 5.17 to 4.97 (5 year arm) and 5.04 to 4.95 (1 year arm). Below are rates for the 4 major mortgage products since May 21st.

Jun 18, 2009
30-yr 5.38 15-yr 4.89 5-yr ARM 4.97 1-yr ARM 4.95

Jun 11, 2009
30-yr 5.59 15-yr 5.06 5-yr ARM 5.17 1-yr ARM 5.04

Jun 04, 2009
30-yr 5.29 15-yr 4.79 5-yr ARM 4.85 1-yr ARM 4.81

May 28, 2009
30-yr 4.91 15-yr 4.53 5-yr ARM 4.82 1-yr ARM 4.69

May 21, 2009
30-yr 4.82 15-yr 4.50 5-yr ARM 4.79 1-yr ARM 4.82

Dec 18, 2008
30-yr 5.19 15-yr 4.92 5-yr ARM 5.60 1-yr ARM 4.94

So why are mortgage rates dropping? Basically for the last few weeks the economy has been improving and consequently we have seen mortgage rates increasing. In addition to that the government held a few bond auctions that went poorly which also provided upward pressure on mortgage rates. In the last week we have seen some signs the economy might not be recovering as cleanly and quickly as first hoped which has the effect of pushing mortgage rates down.

In addition to mortgage rates it's always nice to look at actual mortgage payments. We took today's rates and used a mortgage calculator and turned them into mortgage payments for a 200k loan. We also did the same thing with rates from June 11th (last week) and rates from December 18th (6 months ago).

Jun 18
30-yr $1120.56
15-yr $1570.15
5-yr ARM $1069.97
1-yr ARM $1067.53

Jun 11
30-yr $1146.89
15-yr $1587.84
5-yr ARM $1094.51
1-yr ARM $1078.53

Dec 18
30-yr $1096.98
15-yr $1573.26
5-yr ARM $1148.15
1-yr ARM $1066.32

As we can see payments based on 30 year mortgage rates the monthly payment on a 200k loans is about $26 dollars lower than they were last week.

So what is our advice? First of all I would still recommend 30 year mortgages. While rates on 5 and 1 year arms are lower I still expect rates to be much higher in 1 year and 5 years from now. So basically it's not worth the risk of having to refinance in a few years. Although rates are higher than they were a few weeks ago they are still near historical lows.

As always it's hard to predict what is going to happen moving forward. I would expect volatility in rates over the next month as we figure out whether the economy is one the road to recovery. Once the economy recovers we expect rates to increase rapidly. The government borrowed 50 cents of every dollar it spent this year. That mountain of debt should lead to higher interest rates.

Ki works as realtor in Austin Texas. His site is filled with information about Austin Texas real estate. It also provides information on mortgage rates along with a free mortgage calculator.
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Jun. 19, 2009 - Small Towns Around Austin

Austin is a big, beautiful city; there is no doubt about that. But, there are several small towns within 50 miles of Austin that are filled with charm and beauty. Whether you want to get out of the city for a weekend or move to a smaller town.

Smithville is a small town in Bastrop County, about 41 miles from Austin. Its population is just at 5,000. It is mostly famous for the 1998 movie "Hope Floats" that starred Sandra Bullock. Smithville is most proud of its recreation center. The center has a large gym, basketball court and has events for the entire community throughout the year.

Smithville also has many family owned restaurants, grills and antique shops. Visitors can always find something interesting while visiting.

Coupland is east of Austin on Highway 95, between Elgin and Taylor. This small town is most famous for its dancehall. The dancehall also has an Inn and a restaurant. There is always something going on here, and the band is always live. They have featured such acts a Kevin Fowler, Moe Bandy even George Strait's band has played there.

Coupland's last population was about 150. If you want to get out of the city, this is the place to visit.

Lexington is about 50 miles east of Austin, in Lee County. Its population is just under 1,200. This small German community was named after Lexington Massachusetts. The community has bed and breakfasts and each year, the first weekend in May, they have a "Homecoming" celebration. The celebration begins on the first Friday in May and runs through Sunday. The town holds a parade, food booths, arts and crafts and a BBQ cook off.

Lexington has a heritage center showcasing two log cabins that were built in the 1850's. They have pioneer furnishings, and are open for tours.

Lexington is also home of "Texas Monthly's" number one BBQ joint in Texas, Snows BBQ. It made the top spot in the magazine last summer and is open on the weekends.

Bastrop is a town south east of Austin. Their is a lake called lake bastrop. Over the last several years Bastrop has been slowly growing. With cheaper prices the Bastrop real estate market is becoming an alternative the sky high prices scene in Austin.

Giddings is just 18 miles south of Lexington, on highway 77 and is the county seat of Lee County. This little community's population is just under 6,000. The city has bed and breakfasts, hotels, antique shops. They also have the Lee County Junior Livestock and Rodeo each year at the fair grounds.

Dime Box is also located in Lee County, with a population of just 400. Dime Box received its name by a resident in 1877 when locals would use a wooden box to forward and receive mail. They would leave a dime in the box for payment.

This small town has a winding road through downtown, covered with trees. The community is so small, everything is within walking distance. Residents like to keep the German and Czech heritage alive with the Dime Box Heritage Museum.

There are not any hotels in the small town, but there are small towns nearby that have places to stay. Take time and visit a small town near Austin.


Ki loves to bike the Austin hill country. He has worked with Austin real estate for almost a decade. His website has a search of Austin MLS listings. Along with information about Bastrop real estate and Austin real estate.
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Jun. 19, 2009 - Restful Refuge- Tips to Create a Cozy Bedroom

Your bedroom should be a reflection of coziness and comfort, which can mean a variety of things based upon preference and style. People also want bedrooms to be crisp and clean, as a general rule, in addition to coziness. One way to marry the two concepts is to focus on the lines of the room and ensure they reflect elegance and simplicity. This can be done by focusing on three basic concepts: Texture, color and balance.
Texture plays a key role in making the bedroom cozy from the perspective of linens, carpeting, rugs, fabrics, walls and furniture surfaces. Textures can vary from soft to coarse, patterned to nubby, and shimmering to flat. Focus on textures that reflect your style and what makes you feel serene. However, adding a variety of textures can add dimension to your room. The most interesting decorative approaches often include a wide variety of textures meshed together in one cohesive approach. There are a variety of ways to incorporate texture from furniture styling to a throw on the bed. Some designers recommend using soft chenille or cotton fabrics for the duvet cover or coverlet. And, a must for some, is crisp sheets, which provides that "hotel-like" feel. Another element to keep in mind is the texture used for the floor. Avoid tough surfaces like sisal, which can feel like the equivalent of walking on sandpaper. Soft surfaces or rugs add to the coziness of the bedroom.

Color is also a key element in the overall feel of your room, primarily because it is most often linked to an emotion response. Warm colored rooms automatically seem warm, regardless of the contents or accompanying designs or furniture. However, don't be afraid to use cool colors. Cool colors can be warm and cozy if done in a soft or deep color and accented with a warm neutral tone or warm stain color for wooden accents or furniture.

Balance is the third element of style that is fundamental to creating a cozy space. It entails a point and counterpoint approach to designing a room. For example, if your tastes tend to be modern or transitional, you might consider adding a sleek piece of furniture and contrast it with a textured fabric with a warm color. In spite of how sleek or contemporary you may like your spaces to be, adding enough detail in the right balance can add warmth to the typically sterile feel of modern styles.
Regardless of what elements you decide to incorporate, the most important element is that you feel as if you can retreat to your bedroom at the end of the day. Some designers recommend having lots of down pillows for propping up in the bed. Another suggestion is to have a chair or ottoman in the room (and not for the purpose of throwing laundry on to). Having a chair creates a nice relaxing place to curl up and read or relax. Adding a bright light next to this chair also prevents from having to have bright lights throughout the room. In doing so, you can have various levels of soft lighting in the room, creating a more romantic and intimate feel. If you lack the space for a chair, an alternative suggestion is to have swing arm lamps on each side of the bed, which frees up space on night stands for a book or glass of water.


Ki lives near Shoal Creek. He started working with Austin real estate after graduating from UT. He maintains a website where potential buyers search for Austin homes. It also has information on mortgage rate trends.
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Jun. 12, 2009 - Not So Fast: Is the American Economy Really On Its Way to A Recovery?

Is the recession near the end? Is the American economy on its way to recovery? The answer is probably yes. That's good news, right? Not so fast, say some economic analysts. And they mean, literally, that the stock market may be rebounding a little too quickly.

According to a recent report at Yahoo Finance, the stock market's rally in recent months is a bit of a mixed blessing. The hope that the economy is on the rebound "has lifted the Standard & Poor's 500 index, a benchmark for many investments like mutual funds, an enormous 39 percent from a 12-year low on March 9. Those kinds of gains might normally take four years to materialize."

Both being too quick to call it a recovery and not cautious enough in investing could cause this budding economic upturn to wither on the vine. The numbers remain mixed, with the number of job losses in the month of May are down, but unemployment is up. While the government's report of 345,000 jobs lost is the lowest since September, the actual unemployment rate is 9.4 percent. This indicates that although less people are being laid off, it is still very tough to find a job out there. In fact, the overall number of job seekers rose as college graduates flood the job markets.

Even Federal Reserve Chairman Ben Bernanke has said, even once the economy begins to recover, jobs will be the last sector to rebound. But there are still other troubling signs out there. Recent Commerce Department data shows that May retail sales were mixed, but in general analysts were surprised that more shoppers hadn't returned to stores. Wall Street may be throwing caution to wind, but Main Street seems to be holding onto their cash, with the savings rate up again last month.

One of the biggest downfalls of overzealous investing is that investors are helping push interest rates higher. According to Yahoo, investors have been selling off Treasury bills because they feel they are no longer in need of the safety of government debt. This causes mortgage rates and other kinds of loans for consumers to rise. Interest rates are still historically low, but they have been creeping up in the last few weeks. As the interest rates goes up, borrowing is falling off. The Federal Reserve reported last week that consumer borrowing in April fell by twice as much as analysts had been expecting.

The latest results of the AP's Economic Stress Index, which tracks the economic strains in 3100 counties across the country, show that many areas of the country are struggling more than they were a year ago.
"The AP calculates a score from 1 to 100 based on each county's rate of unemployment, foreclosure and bankruptcy, with lower numbers indicating less economic pain. The average Stress score dipped to 9.7 in April, from 10.3 in March. In April 2008, the national average was 5.9."

So while most indications show improvement in the economy in the first part of 2009, a slow, steady recovery is more likely to help this nation that has been stressed in so many ways over the last year and a half. After all, exuberant investing is what got us into this mess in the first place.


Ki lives and works in Austin and has worked in the Austin real estate market for 10 years. He maintains a search of Austin MLS on his website. It also has general information on Austin real estate and current mortgage rates
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Jun. 12, 2009 - Mortgage Rates Skyrocket

Last week mortgage rates moved up rapidly, moving up from 4.91 to 5.29. This week mortgage rates again jumped up .3 points going from 5.29 to 5.59. On May 21st rates were sitting at 4.82 which was a 40 year low. Now just a few weeks later rates are at 5.59. This is the highest we have seen rates since November 26, 2008. Unlike last week this week all the other major mortgage products went up as well. The 15 year rate jumped from 4.79 to 5.06. The 5 year arm moved from 4.85 to 5.17 and the 1 year arm moved from 4.81 to 5.04.

So what caused the sudden spike in mortgage rates? Basically the government had a few recent auctions of government debt that went poorly. With less interest in government debt, t-bills and mortgage rates have started to increase.

Below are rates for the major mortgage products for the last few weeks.

Jun 11, 2009
30-yr 5.59 15-yr 5.06 5-yr ARM 5.17 1-yr ARM 5.04

Jun 04, 2009
30-yr 5.29 15-yr 4.79 5-yr ARM 4.85 1-yr ARM 4.81

May 28, 2009
30-yr 4.91 15-yr 4.53 5-yr ARM 4.82 1-yr ARM 4.69

May 21, 2009
30-yr 4.82 15-yr 4.50 5-yr ARM 4.79 1-yr ARM 4.82

May 14, 2009
30-yr 4.86 15-yr 4.52 5-yr ARM 4.82 1-yr ARM 4.71

Dec 11, 2008
30-yr 5.47 15-yr 5.20 5-yr ARM 5.82 1-yr ARM 5.09

In addition to rates we like to look at mortgage payments. Using a mortgage calculator we took rates from this week and translated them into a mortgage payment for a 200k loan. We also did the same thing with rates from June 4th, May 28th and from December 11, 2008 (6 months ago)

Jun 11
30-yr $1146.89
15-yr $1587.84
5-yr ARM $1094.51
1-yr ARM $1078.53

Jun 04
30-yr $1109.36
15-yr $1559.79
5-yr ARM $1055.38
1-yr ARM $1050.53

May 28
30-yr $1062.66
15-yr $1533.05
5-yr ARM $1051.74
1-yr ARM $1036.07

Dec 11
30-yr $1131.81
15-yr $1602.5
5-yr ARM $1176.05
1-yr ARM $1084.67

So as we can see mortgage payments have jumped drastically. Compared to 2 weeks ago the mortgage for a 200k loan has increased by $84.23 or 7.3 percent.

One point is that although rates have jumped rapidly historically speaking rates are still very low.

So what do we expect moving forward? There is some speculation that rates will fall after the recent rise. I am not sure if this will happen or not there are some powerful forces moving mortgage rates. And regardless of what happens in the next few weeks with the massive government borrowing its expected that in 6 months rates will be significantly higher than what we are seeing today.

So what is our advice to people looking for a home? First of all I would lock in immediately. While rates might go down there is a significant chance will continue to rise. If rates fall you can always relock at the lower rate. Additionally, I would avoid arms. Although the difference between 30 year rates and arm's has increased I would expect rates to be much higher in a year.


Ki lives in Austin Texas. His website provides information on Austin Texas real estate. It also provides a mortgage widget and a free mortgage calculator.
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Jun. 12, 2009 - Take a Drive Through Texas Wine Country

If a trip to visit the famous vineyards of Napa Valley, California isn't in the budget this summer, try a scenic drive through some local wine country. Central Texas offers a number of locally produced wines, from the nationally recognized to smaller family owned operations.

A trip down Highway 290 West not only offers rustic Texas landscapes with its own kind of beauty, but also several vineyards along the way. Johnson City has the Texas Hills Vineyard, with soil considered to be like the coveted Tuscan countryside in Italy. Becker Vineyards in Stonewall boasts 46 acres of grapevines and three acres of lavender, which blooms in May and June. Also in Stonewall is the Grape Creek Vineyard with the only completely underground wine cellar in Texas. Continuing west on Highway 290, Fredericksburg has a number of vineyards, including Bell Mountain Wine Cellars in business for 33 years and Chisholm Trail Winery.

If taking in lake views while tasting Texas wines sounds nice, head north on Highway 281 to the family owned Spicewoods Vineyard in Marble Falls. Fall Creek Vineyards on the shores of Lake Buchanan is composed of 65 acres of vineyards making award wining wines in the "French tradition combined with California technology." Take in some Lake Travis views at Lago Vista's Flat Creek Estate Vineyard and Winery.

Heading south a wine lover can find the Sister Creek Vineyards in Boerne, which is housed in a historic cotton gin. Or, in New Braunfels try the Dry Comal Creek Vineyards and one might as well stop in Gruene Hall while in that area.

All these wineries offer tours and tastings and visitors are encouraged to taste the lesser known wine varieties that Texas is gaining a reputation for producing. Ever heard of a sangiovese or malbec? How about a syrah? Texas soil is better suited to some of these more obscure wine varieties. While one can certainly find a Texas chardonnay, a viognier made in Texas may taste better. The Austin-American Statesman recently picked some favorite local wines like the Becker Vineyards Malbec 2006 or the Tuscan-style red Flat Creek Estates Super Texan 2006.

If wine tasting without the driving sounds a little more appealing, there are a number of local wine bars that offer a unique tasting experience. From the trendy to the cozy to the ostentatious wall of wines, Austin-American Statesman's XLent section recently highlighted some local spots for a good glass of wine. Cork & Co. on South Congress was described as cozy while Cru: A Wine Bar has a "plush ambiance." There is also Taste on Cesar Chavez Street and Uncorked Tasting Room and Wine Bar on East Seventh. An impressive wall of wine can be seen at Vino Vino on Guadalupe Street.

Whether hopping in the car to head downtown for the evening or driving west for the day, Austin and the surrounding Hill Country can offer something from the mildly curious wine-drinker to the passionate oenologist.


Ki works near downtown Austin. He has been involved in Austin real estate for ten years. He has a graphical Austin MLS search on his website. His site also has updated news and stats on Austin Texas real estate on his blog.
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Jun. 12, 2009 - The Roots of an Austin Icon

It is hard to imagine Sixth Street as anything other than the bar-lined street which has attracted bar-hopping young people for decades. But Pecan Street, as it was originally named, got its start in the 1800s as the main thoroughfare into town for farmers and others going into the city for reasons of commerce. By the 1860s, it had its first saloon, along with livery stables and wagon yards.

The city was originally designed on a single square mile grid of 14 blocks, with Congress Avenue running through the middle. All the original north/south running streets were named for Texas rivers, like Brazos and Rio Grande. The east/west running streets were originally named after Texas trees (i.e. pecan), but were changed to numbers in 1884. Much of the original street design is still intact in downtown Austin.

It was the arrival of the railroad to Austin in 1871 that brought the heart of this booming town right to Sixth Street. Soon Victorian limestone buildings proliferated down the tree-lined street, most notably the Driskill Hotel. This luxurious hotel, complete with marble floors and stained-glass dome, was built in 1886.

The seven blocks between I-35 and Congress became known as Austin's entertainment district. The street was changed to a one-way and revitalized in the mid-1970s. Music was at the heart of this rebirth, largely thanks to artists like Wille Nelson who brought national attention to the Austin music scene.

"Today, Austin is known as much for its cultural life and high-tech innovations as it is for the senators and schoolteachers who shaped its beginnings. The same success that has gained the city a national reputation has brought with it many difficult choices, as the city expands on a scale that might shock the early residents of Waterloo," said Biruta Celmins Kearl, Curator Emerita of the Austin History Center.

There are bar-lined streets in cities all across America, but there is something unique about Sixth Street, something quintessentially Austin. Maybe it's the music that spills out into the street from nearly every doorway. Maybe it's the eclectic collection of businesses, like tattoo parlors, to entertainment like Esther's Follies. This combination of improv and satire has been enthralling audiences since 1977.

But it's not just the nightlife that attracts people to Sixth Street. Places like Paradise Bar and Grill have brought in lunch crowds for decades and Dan McKlusky's is a favorite dinner spot for steak lovers. The Pecan Street Festival, celebrating Austin arts and crafts, brings thousands to Sixth Street every year.

Other well-known events that bring thousands flocking to this famous stretch of street are Halloween and Austin Mardi Gras, for which the street is blocked off from traffic to allow revelers to roam freely. Perhaps the best known Sixth Street event is South by Southwest. SXSW is Austin's film and music extravaganza that takes place each March.

Even fire can't slow down this stalwart street full of history, music and fun. On February 6, four businesses were damaged by fire in the early morning hours. The damaged caused by a cigarette tossed under some stairs is estimated at more than $1 million. However, crews were quickly put to work repairing the fire and smoke damage and life on this iconic stretch of street will go on as it has for over 100 years.


Ki lives in Central Austin. His website has information on Austin Texas real estate. His website lets people search the Austin MLS it also has a blog with statistical information on Austin real estate.
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Jun. 4, 2009 - Mortgage Rates Spike Up Rapidly

Mortgage Rates spiked up this week. The 30 year rate jumped from 4.91 to 5.29. This is the highest we have seen mortgage rates all year. Last week mortgage rates moved from 4.82 to 4.91 last week. What is interesting is that in two weeks mortgage rates have moved from near all time lows (the all time low was 4.78) to the highest point of the year. The 15 year rate moved up from 4.53 to 4.79. We did not see as much movement in the arms. The 5 year arm rose from 4.82 to 4.85 and the 1 year arm moved from 4.69 to 4.81.

Two weeks ago 30 year rates and 1 and 5 year arms were all hovering around 4.8 making the arms somewhat pointless. There is no reason to get an ARM when one can get a 30 year fixed mortgage for the same rate. With the sudden rise in the 30 year rate the arms have become relevant again. I still think the 30 year mortgage product is preferable over the arms even at current rates. Although 30 year mortgage rates have risen the expectation is that they will continue to rise for the rest of the year. Below are rates for the last few weeks as well as from 6 months ago.

Jun 04, 2009
30-yr 5.29 15-yr 4.79 5-yr ARM 4.85 1-yr ARM 4.81

May 28, 2009
30-yr 4.91 15-yr 4.53 5-yr ARM 4.82 1-yr ARM 4.69

May 21, 2009
30-yr 4.82 15-yr 4.50 5-yr ARM 4.79 1-yr ARM 4.82

May 14, 2009
30-yr 4.86 15-yr 4.52 5-yr ARM 4.82 1-yr ARM 4.71

May 07, 2009
30-yr 4.84 15-yr 4.51 5-yr ARM 4.90 1-yr ARM 4.78

Dec 04, 2008
30-yr 5.53 15-yr 5.33 5-yr ARM 5.77 1-yr ARM 5.02

In addition to mortgage rates we also like to look at mortgage payments. Using our mortgage calculator we translated today's mortgage rates into a monthly payment on a 200k loan. We did the same thing with rates from last week and rates from December 4, 2008 (6 months ago).

Jun 04
30-yr $1109.36
15-yr $1559.79
5-yr ARM $1055.38
1-yr ARM $1050.53

May 28
30-yr $1062.66
15-yr $1533.05
5-yr ARM $1051.74
1-yr ARM $1036.07

Dec 04
30-yr $1139.34
15-yr $1616.18
5-yr ARM $1169.68
1-yr ARM $1076.08

Usually there is not too much difference from week to week. That is not true this week. The payment on a 200k loan has risen 46.7 or about 4.4 percent. Payments are down 2.63 percent from what they would have been 6 months ago.

So what is our advice to people looking for a home? Unfortunately I think mortgage rates will continue to rise so it's probably best to lock in rates now. Second although arms are a viable option I would still take the 30 year rate over the 1 or 5 year arm. There are some expectations this recent rise is just the tip of the iceberg and we could see rates above 12 percent before this is over with.


Ki maintains a website about Austin Texas. His site also provides information on mortgage rates along with a free mortgage calculator.
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Jun. 4, 2009 - New Legislation to Regulate Credit Card Companies

A bill will soon become law that curtails certain practices of the credit card companies. The irony is that banks were told this month to raise more capital, then Congress decides to impede one of the banking industries more lucrative businesses. That is not to say that banks should be allowed to run amuck with interest rates and fees. However, it will most likely be the 42 percent of Americans who pay their complete balances on time every month who will end up paying for this new law.

President Obama is expected to sign into law a bill passed by Congress that overhauls the credit card industry. According to the Associated Press, the bill will do the following:

-Companies cannot charge retroactive rate increases unless the cardholder is at least 60 days behind in paying the bill.

-If a rate increase is enacted because a cardholder has fallen behind on payments, lenders must restore the lower rate after six months if the cardholder has paid monthly bills on time.

-Companies must post credit card agreements on the Internet.

-Potential cardholders under 21 to prove to the credit card companies that they can repay the money before being given a card, or have a parent or guardian promise to pay off their debt if they default.

-Cardholders cannot be charged over-the-limit fees unless they elect to be allowed to go over a limit.

-Companies must say how much time it would take and how much money in interest would be paid if only the minimum monthly payments are made.

-Gift cards must be valid for five years.

-Companies cannot charge fees when cardholders pay the bill by phone or on the Internet.

-Companies cannot eliminate the interest-free period for cardholders who move from paying the full balance monthly to carrying a balance.

-Companies must give cardholders a reasonable time to pay the bill before it is considered late.

-Companies must give cardholders 45 days notice before raising interest rates on new purchases, even if the customer is late or delinquent in paying the account.

"Those who manage their credit well will in some degree subsidize those that have credit problems," Edward L. Yingling, CEO of the American Bankers Association, told the New York Times. In other words, banks will recoup losses from higher interest rates and late fees by reviving annual fees, putting restrictions on reward programs and eliminating the grace period for charging interest on purchases.

It is the fine print on the credit card bill that has gotten many Americans into trouble with their credit. Research shows that the majority of credit card companies stipulate that rates can increase to any amount for any period of time if the cardholder is deemed a credit risk at any point.

"This is America and we don't begrudge a company's success when that success is based on honest dealings with consumers," President Obama said recently. "We need reform to restore some sense of balance." In this time of job loss and financial uncertainty, it is the credit card balances that may trump finding a true balance of fairness in the credit card business.


Ki graduated from UT with a CS degree. Now he works with buyers interested in Austin real estate. His website allows buyers to search Austin MLS listings. It also provides information on mortgage interest rates.
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Jun. 4, 2009 - Home Remodeling: Lavish Bathrooms

Nowadays people are spending upwards of $10,000 on a total bathroom remodel. Homeowners are opting for more spacious and ornate bathrooms complete with natural stone floors and multiple showerheads. But, if your budget can't quite handle the expense of a jetted tub or marble shower, there are plenty of options that provide heightened style without a heightened credit card bill.

The best place to start is with paint. Adding a splash of color can do wonders for your bathroom. Start by changing the color of your walls to a light and airy hue. The best options are blues, light purples and neutral colors, all of which convey a calming and soothing feel that is perfect for feeling relaxed in your bathroom. Another option for a quick upgrade that adds color is to change the faucets and fixtures. Adding a splash of class or style can quickly change the entire look and feel of your bathroom. A hot trend right now is brushed brass fixtures, which convey a rich and classy feel that complements neutral colors. Other popular options are faucets that buck the standard look with a unique layout or design.

The primary area of focus in today's lavish bathrooms is the shower. If you prefer to have a bath tub, there are three general types to choose from: standard drop-in tubs, free-standing tubs or walk-in tubs. Many homeowners are opting for air-jet tubs with provide therapeutic and massaging effects while also allowing homeowners to use bath salts or bubbles. If you prefer the shower only layout, the possibilities are endless. Today's showers are virtually human carwashes with the ability to install multiple shower heads with a variety of sprays and angles.
If these options are not for you, try going with a few simple upgrades. Adding a high window near the top of your bath or shower can allow natural light to enter the area, which opens everything up and you feel less like you're crawling into a cave to take a shower. In addition, consider regrouting your current tub and tile. This simple task can go a long way in eliminating any dingy appearances that have accumulated over several years of use. Another option is the installation of a prefabricated tub or shower surround, which can replace or be installed over top of your existing shower depending on the model and type chosen. Finally, consider adding a luxurious shower head, such as a rain-like or massaging shower head for a extra touch.

The final element that distinguishes a luxurious bathroom from a standard bathroom is the lighting and flooring. Lighting, while often overlooked, can be an excellent way to control the feel of your bathroom. A good idea is to install a diverse set of lighting such as overhead can lights near the vanity area and indirect ambient lighting that is ideal for low-key and relaxing baths.
Flooring is also a popular upgrade with natural stone and tile being especially popular in lavish bathrooms. Since these types of flooring can be cold, many homeowners opt to install sub-floor heating systems that warm floors with heated water. A more economical choice is to use low-voltage electric mats, which are smaller in size yet provide just enough of a warm area to stand while getting ready each morning.

In addition to these remodeling ideas, top the bathroom off with accessories that accentuate the look and feel of your bathroom. If you're looking for an elegant appeal, small yet stately glass containers with a stainless steel top to store cotton balls and Q-tips are popular accents. If you looking for a warm and low key feel, a popular choice is baskets to store lotions and towels. Finally, top it off with new drawer pulls or towel rods to match the updated look and to carry the theme throughout your bathroom.


Ki works as a realtor in the Austin real estate market. He developed a search of houses in the Austin MLS on his website. His site also has general information on Austin real estate and Austin condos.
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Jun. 4, 2009 - Energy Audits and Tax Credits

While the Austin City Council is not giving home sellers a break this year, the federal government is coming through with some tax breaks for the energy-conscious homeowner. For 2009 only, homeowners can get certain tax credits for making energy efficient improvements on a primary residence.

What does this have to do with the Austin City Council? As of June 1 homes older than 10 years are required to get an energy audit and disclose the results to prospective buyers. So along with the new coat of paint and fresh flowers in the yard, homeowners have an added expense to get their homes sold.

The idea behind the city council ordinance is a noble one of keeping Austin green, but the timing is lousy with job losses and a slower housing market looming over the city. "There's never a good time to add fees to a transaction," City Council Member Mike Martinez said in the Austin-American Statesman, "but I think this requirement is a good thing. It allows the consumer to fully understand the purchase they're about to make. If you spend hundreds of thousands of dollars on an investment, you would want to know how efficient that investment is going to be for you."

Fortunately recession-strapped homeowners are not required to make improvements as a result of the $200-500 audit, however the idea is to encourage sellers or buyers to make their houses more energy-efficient. An audit can help pinpoint exactly what needs to be done to make a home greener.

This is where the tax credits come in. Under the Emergency Economic Stabilization Act of 2008, also known as the Obama stimulus package, Congress has provided two tax credits for homeowners making energy efficient improvements. There is a $500 lifetime credit, which gives a 10 percent credit for improvements such as new insulation, windows, skylights, energy-efficient roofing or exterior doors.

The other tax credit is a 30 percent-of-cost credit for energy improvements. This would include $50 for each advanced main air circulating fan; $150 for qualified furnaces, such as natural gas or propane; and $300 for qualifying energy-efficient heating and cooling systems or hot water heaters.

In a buyers market, sellers wanting an edge may go ahead and make some of the improvements indicated by an energy audit, which focuses on things like insulation and the condition of the heating and cooling systems. This year's tax credits may help offset some of those costs. Also, according to the Statesman, "Austin Energy offers rebates or zero percent loans for energy upgrades."

Of course, these tax credits and Austin Energy incentives aren't just for those wanting to sell their home. According to Austin Energy, in the past five years homeowners have made improvements that have collectively saved $3 million by reducing kilowatt-hours by 38 million.

It's a good idea to get the exact details on the tax breaks from a tax professional. The Austin Energy website also offers information on the audits, rebates and loans, along with energy saving tips.

Ki lives in Austin Texas. He created a site which has detailed information about Austin Texas real estate. It allows buyers to search for homes in the Austin MLS. He also maintains a blog with monthly statistics on Austin real estate.
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May. 27, 2009 - The Retirement Community of Sun City Texas

Sun City is a retirement community located in Georgetown. It is not the normal retirement home or community. This community offers its residents small town charm, but just minutes from Austin. Sun City was also recently named one of the nations top retirement communities by Retirement Places Rated, a guidebook for seniors wanting to relocate upon retirement.

Its location is excellent, and has extremely affordable cost of living and tax advantages. Currently Sun City has about 5,500 homes and plans to expand to 7,500 homes by 2012-2013.

Most of the homes in Sun City range in price beginning around $100,000- up to $500,000. The sizes vary, but average size is between 1300 square feet to 2800 square feet.

Sun City has many amenities for active seniors to enjoy upon their retirement; tennis courts, three championship golf courses, swimming pools, miles of walking trails and much more.

Sun City also has a community center for residents. The Village Center spans an amazing 86,000 square feet, and is home to many indoor amenities such as art classes, a woodshop which is equipped with all the tools and machinery needed to build something simple or something more complex.

There is also a 5,000 square foot open air legacy pavilion, called Legacy Hills Pavilion. This pavilion over looks Berry Creek Lake and is where many neighborhood gatherings happen. There are many hiking trails in the area and the views and scenery make it very popular.

There is also a computer lab and over 30 clubs. Residents can play dominos, crochet, play bingo or just sit back and visit with other residents. The community also has its own lifestyle director to help residents adjust to their new life, whether they just moved to Sun City or if they have been here for awhile and just never had time for activities.

Sun City also has its own restaurant, Sparky's. It is perfect for residents who are too busy to cook or just want to grab a quick bite to eat without having to drive far.

For residents who are concerned with health issues and transportation the community has nearby medical facilities such as Scott & White Medical Clinic and Georgetown Hospital. Transportation is provided by CARTS, and provides curb side service on Tuesdays and Thursdays.

The community also has many parks for residents to enjoy, with plenty of places to sit and have a picnic or just enjoy the Texas scenery.

Sun City is for adults age 55 and over, and is an alternative to living in a retirement home or living alone in a neighborhood. Sun City gives its residents the security they need, while living an active lifestyle.
For seniors who are not sure if Sun City is right for them, they also have a two night weekend getaway. Potential residents can visit the community and see if it is something they would enjoy, without the pressure to move in.

Ki's office is in Central Austin. He also has a website devoted to Austin real estate. There is a search of Austin homes for sale as well as information on the Sun City Texas real estate.
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May. 27, 2009 - A Look At Credit Cards : The Psychology of Plastic

"We said that big banks can no longer take advantage of hardworking Americans," Senate Majority Leader Harry Reid, D-Nev., said of the recent legislation that will restrict rate hikes and late fees charged by credit card companies. But some out there argue that credit card holders are just as culpable. It seems there is a fine line between who is really to blame: the companies that provide the easy credit with high penalties or the consumers that take easy credit and ignore the possible penalties.

Just how did credit cards become so ubiquitous in the American financial landscape? A recent article in Time magazine noted that credit cards have been around since the 1920s. Service stations, hotels and restaurants began offering credit cards when Americans began venturing out in their cars to a world beyond the convenience of their local banks. By the 1950s, over 20,000 Americans carried the Diners Club card in their wallets. That success was followed by American Express and Bank of America, which both began offering credit cards in 1958.

Flash forward 50 years and Americans are predicted to be in credit card default to the tune of $75 billion this year. It seems psychology had a little to do with that, after all no one forced Americans to obtain credit cards and then charge on them beyond their means. No, it seems that the perceived irresistibly of not actually paying now is hard to refuse.

A study at the Massachusetts Institute of Technology showed that people can be quite irrational when it comes to credit. The study by Drazen Prelec and Duncan Simester showed that people don't perceive credit and cash in the same way and will pay twice as much for something, in this case basketball tickets, purchased with credit. Researchers at the University of Pennsylvania have estimated that the typical cardholder pays an extra $200 a year in interest on a credit card balance while keeping a large amount of cash in savings or checking.

It seems people happily ignore the fine print in those multiple-page credit card bills that come every month and focus instead on the minimum amount due, which is printed in large bold numbers. While the new credit card laws may offer consumer protection from the credit card companies, perhaps it is protection from the innate urge to whip out the plastic now and pay later that is the real culprit.

Here are a few tips on how to be smarter about credit cards:
1. Look over credit card bills carefully. Taking a few minutes to look at the fine print can save a cardholder money in the long run. While the new credit card legislation stipulates that lenders must say how much time it would take and how much money in interest would be paid if only the minimum monthly payments are made, it will be several months before that disclosure shows up on bills. In the meantime, consumers should do the math and make purchases with the long-term costs in mind.

2. Credit cards make it easy to track spending, so consumers should pay close attention to what goes on the bill every month. It doesn't make sense to carry a balance on lattes and lunch when paying cash for those items would save money in the long run.

3. Get a credit report and make sure the facts are correct. Credit scores determine not only a consumer's credit worthiness, but also the interest rate that will be paid on loans.

4. Make an effort to pay off credit balances, starting with those carrying the high interest rates. By paying a little extra each month, cardholders can chip away at debt and improve credit scores. However, financial planners warn consumers not to close accounts once they are paid off. A long history of good credit with many accounts is what credit scores are based on.


Ki works as a realtor in Central Austin. He maintains a website focused on Austin Texas real estate. The site allows future owners to search the Austin MLS as well as read stats and analysis on his real estate blog.
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May. 27, 2009 - Mortgage Rates Hover Near All Time Lows

There was not much movement in most of the major mortgage products this week. The 30 year rate dropped from 4.86 to 4.82. This is only slightly above the 4.78 all time low that was reached a few weeks ago. The 15 year rate dropped from 4.52 to 4.50. There was some interesting movement with the 5 and 1 year arm. The 5 year arm dropped from 4.82 to 4.79. At the same time the 1 year arm rose from 4.71 to 4.82. This is the first time the 1 year arm has been above the 5 year arm. Regardless both rates are pointless because they are at or near the same rates for a 30 year arm; therefore there is no reason to get an arm instead of a 30 year mortgage in the current market. Below are mortgage rates for the last few weeks and from 6 months ago on November 20, 2008.

May 21, 2009
30-yr 4.82 15-yr 4.50 5-yr ARM 4.79 1-yr ARM 4.82

May 14, 2009
30-yr 4.86 15-yr 4.52 5-yr ARM 4.82 1-yr ARM 4.71

May 07, 2009
30-yr 4.84 15-yr 4.51 5-yr ARM 4.90 1-yr ARM 4.78

Apr 30, 2009
30-yr 4.78 15-yr 4.48 5-yr ARM 4.80 1-yr ARM 4.77

Nov 20, 2008
30-yr 6.04 15-yr 5.73 5-yr ARM 5.87 1-yr ARM 5.29

As we can see rates have not experienced much movement in the last month. They have continued to hover around all time lows for the month of May. They remain substantially lower than what we saw 6 months ago. In addition to rates we always like to look at actual mortgage payments. We took today's rates and translated them into a mortgage payment for a 200k mortgage. We did the same thing with rates from last week and rates from November 20, 2008.

May 21
30-yr $1051.74
15-yr $1529.98
5-yr ARM $1048.12
1-yr ARM $1051.74

May 14
30-yr $1056.59
15-yr $1532.03
5-yr ARM $1051.74
1-yr ARM $1038.47

Nov 20
30-yr $1204.24
15-yr $1658.67
5-yr ARM $1182.43
1-yr ARM $1109.36

A mortgage payment this week is slightly lower than what it would have been last month. This is nothing compared to the saving one would get compared to 6 months ago. For a 200k house a mortgage payment is $152.50 less a month now than it would have been on November 20, 2008 for a drop of 12.66%. This is often forgotten when the media talks about home prices being down 15% to 20%. After one factors in mortgage rates along with falling house prices the actual payments could be down over 30%.

So what do we expect to happen over the next few months? As long as the economy stays week mortgage rates will probably continue to hover around just under 5%. Once the economy starts to recover the general expectation is that rates should start to rise. It's hard to know how high mortgage rates will go once the economy recovers. Estimates have ranged from 10% to 18%. Most of this will depend on how quickly the economy recovers and if the FED moves quickly enough to changes policies from boosting the economy to slowing inflation.


Ki lives in Austin Texas. He website provides a free Austin home search. He also provides a mortgage calculator widget along with a few other mortgage widgets that show updated information on mortgage rates.
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May. 27, 2009 - The Price of Clean Air

The term "cap-and-trade" is heard a lot these days when discussing global warming and environmental policy. What exactly is cap-and-trade? Well, it's the government giving companies an allowance (the cap) on pollution by setting CO2 emission standards. Companies that stay under the cap can sell (the trade) their leftover allowances to companies that go over the pollution standards. It sounds like a win-win, but cap-and-trade has its opponents.

In recent weeks the Environmental Protection Agency has declared carbon dioxide as dangerous to public health, and in all likelihood will move to regulate CO2 emission under the Clean Air Act. With that in mind, U.S. Reps. Henry Waxman of California and Edward Markey of Massachusetts have drafted a bill that would establish a U.S. greenhouse gas policy.

The Waxman-Markey bill, also known as The American Clean Energy and Security Act of 2009, would use cap-and-trade to set CO2 standards across the nation. The ultimate goal of the bill is to reduce the number of available allowances each year in order to achieve an 83 percent reduction in CO2 emissions by 2050. That's an impressive goal.

It's also a goal that many deem too expensive, especially in the midst of a recession. Some house Republicans have put the price per household as high $3000 a year to comply with the Waxman-Markey bill. A recent post on a Wall Street Journal blog stated that the EPA puts the cost at less than $150 per household each year. "According to Lisa Jackson's number-crunching crew at EPA, households would pay between $98 and $140 a year through 2050 for overhauling the country's energy landscape. Economy-wide, the impacts also seem pretty modest. It will take until 2030 for the national GDP to reach $22.6 trillion; if cap-and-trade is passed, that will just take three months longer."

The other concern is how the so called pollution allowances are set by the government. University of North Texas professor Bernard L. Weinstein stated in a recent Austin-American Statesman column that the government could either auction off the allowances or allocate them with a set standard. Weinstein believes that auctioning off the allowances to the highest bidder will put undo financial pressure on companies and consumers alike. He is a proponent of a cap-and-trade system with the government allocating allowances, at least initially.

The other concern with cap-and-trade is that it allows some companies, and thus some parts of the country, to continue to be big polluters. While overall air quality standards may be met, poor air quality could still exist in some parts of the nation. This seems incredibly unfair, not to mention unhealthy, to cap-and-trade opponents.

So what does all of this mean for Texas? Well, it could mean more money and even jobs for the state. While Governor Rick Perry remains staunchly against cap-and-trade policies, saying it will hurt the Texas economy, others point to the opportunity for Texas companies to be at the forefront of these clean air policies. New policies often require new technology and Austin is a perfect place for that technology to be developed.

Ki has an office in central Austin. His website has general information about Austin real estate. His website provides a graphical search of the Austin MLS. He also writes about Austin Texas real estate news and statistics on his blog.
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