by Bill Stanberry

photo by Merrick Ales

Our community had a disaster stroke, and got hit hard.  Many of those suffering damage have already found solutions, albeit in some cases, temporary.  Some have purchased homes already; others are still waiting for insurance settlements or FEMA payments.  In the Realtor community, we have learned much more about insurance, settlement options, how FEMA works, why building on a damaged slab is a bad idea, the scarcity of rental properties, and how quickly demand pushes prices up.  We have learned how to vet builders, that is, to check out their credentials, and learned something about cleaning up lots and how lot prices are lowered in a widely damaged area.

We have also had the benefit of psychology counselors who identify the common stress related problems with which those suffering devastating losses must cope.  They say that the best advice is to “take a deep breath, and wait a while before making major decisions.”  The problem with making hasty decisions is that they are pressed by the current circumstances, when a more deliberate and thought out decision would serve the individual or family much better in the longer term.  

In that regard, many will rebuild in the community, and many more will rebuild on the lot where their home was destroyed.  Building a new home will require several months of a temporary solution which, again, need to be well thought out.  For example, don’t sign a one year lease if your home will be finished in six months.

It is near certainty that there will be well over a thousand new homes built or rebuilt in the Bastrop community during the next couple of years.  Among the large number built, there will be some horror stories of poor construction, broken contracts, lower quality fixtures than you think you paid for, corners cut, and failure to follow-up with the post closing problems needing correction, a need that is common among the very best home builders. Those choosing to build should use good judgment and advice in choosing a builder.  Most in the Bastrop area are reliable, honest home builders, and those who are members of the Greater Austin Home Builders Association are also easy to vet and discern their credentials.  With the great demand for builders in the community, there will also be some coming from outside the area and even the state to contract to build.  To protect the dollars you invest, it is important to learn what you don’t know and what problems are commonly encountered in the process.  Most important is to know that the builder is not your agent; he represents himself.  That doesn’t mean that he is not honest nor that pride in his work and protecting his reputation are unimportant to him.  What it does mean is that the kind of builder who has demonstrated these values are of utmost, long term importance to you in building your new home. It also means that if you need good advice and someone to represent you in choosing a builder and be by your side through the entire process, working with a local Bastrop Realtor is a good solution.  And when contracting for a home, if a fee is paid to your agent, it is paid by the builder and is not an out of pocket expense for you.  Involving a third party professional to insure that your interests are given the importance and care that gives you comfort may well be the best decision you can make.

 In response to the many questions asked of Realtors by the citizens displaced by the recent Wildfire destruction and in an effort to provide Realtors with the ammunition to provide better answers, the Bastrop Board of Realtors arranged for a distinguished panel of experts covering topics of interest such as rebuilding construction, insurance issues, legal topics and psychological issues related to emotional stresses.  Arranged by Board President Caitlyn Lopez and her team, the meeting conducted September 21 was well received and deemed pertinent and helpful by the 46 Realtors in attendance. 

This event provides Realtors with better capacity to provide accurate and helpful information to disaster victims on such matters as insured rights and the procedures to follow plus any recourse for insured complaints of unsatisfactory settlements.  Victims who lost their homes are advised of the several options for rebuilding, buying another home, renting, and selling their lot. All slabs of fire destroyed homes require an engineer’s inspection to determine if the slab must be replaced or can be reused.  Those rebuilding must insure that the builder is vetted by proper authority to avoid sub-standard quality construction. Those who have lost everything have large and life changing options to consider, and should not move or decide too hastily. They are advised to take deep breaths and consider all options carefully, getting advice on all options before making a move.  Everyone should register with FEMA within the 60 day time limit, to insure that any Federal assistance, some which might be approved at a later date is available to them. Bastrop Realtors are now better equipped to provide helpful information and directions to get needed support.

-Bill Stanberry

We at Stanberry and Associates are committed to helping the people of this community in this time of dire need.  Since we are in the business of housing, many people are contacting us looking for properties to rent, and there are not many available.  If you or someone you know has a property that you are willing to lease in Bastrop or surrounding communities, please let us know so we discuss options.  

Additionally, we are opening our Bastrop office as a drop off point for distribution of emergency items for the community:  Food (non-perishable or not requiring refrigeration), bottled water or drinks, clothing, pet food and items for babies (diapers, formula) and personal toiletry items (toothpaste, toothbrushes, deodorant, soap, razors, shampoo, etc.) 

Bring any items to 111 N. Hasler Blvd (across from the HEB) during the hours of 9-5 or call ahead if you need assistance. 

Click the map for directions

Our nation owes a debt of gratitude to the 1 percent of Americans who are committed to fighting for our freedom.  We often talk of how grateful we are for our servicemen and women, but to do something stronger than talk about it often eludes us.  Throughout our history, our nation’s leaders have sought ways to repay our service personnel for the sacrifices they have made in our behalf. 

One of the longstanding and particularly valuable programs was created to enable them to achieve the American dream of home ownership. Even so, there are still many eligible service personnel and veterans who do not fully realize the value of a VA loan when compared to any other means of acquiring a home. With any other financing, the buyer typically must make a cash down payment of 20% to avoid adding 1-1.5% to the interest rate of his loan for mortgage insurance premium. 

In the case of the VA loan, the government guarantees the top 25% of the lender’s loan allowing the veteran to make a zero down loan while avoiding the need to add the cost of mortgage insurance.  There are other benefits such as limits on appraisal costs and other fees required to establish the loan.

Recessions are like people — no two are alike. The only thing certain about them is that every few years, they show up.  What is more certain is that they come and go.  In one like we are in now, we wonder when it will go.  For about three years now, we have been expecting and hoping that there would be an economic turn around and the market, even the devastated housing market, would turn around and promptly get back to some kind of a norm. 

Despite the fact that the Fed said that it ended nearly two years ago, there hasn’t been a lot of convincing evidence to show that to be the case.  In most of the nation, home prices have fallen, some exceeding 40%, while in our local market, slow appreciation has continued.  It isn’t uncommon for the Central Texas housing market to be “counter-cyclical” with the rest of the nation. That also occurred in the early 80’s.  Though we have had several thousand foreclosures during this recession, our pain has been small compared with that of many other cities and states across the nation. 

The market we have here now is marked by continuing historically low interest rates, like below 5%; reasonably low prices with many distressed property sales still available; and rental rates  rising rapidlywhile rental property occupancy is approaching saturation.  These are the conditions that make owning or buying residential property a opportune choice.  On the side of taking advantage of this buying opportunity for most prospective buyers is the greater challenge of getting financing approved.  Lenders have raised qualifying scores, generally  required larger down payments, and made a more concentrated effort to insure the loan gets paid off.  Even so, there are many financing programs available to enable buyers with smaller down payments to get affordable loans.

No matter what the economy, people need a place to live, so for those for whom buying is a possibility, it’s also an opportunity.  Being an optimist, I expect the market to recover at some point in the near term, and being a pragmatist, I don’t recall that buying in the bottom of a recession to ever be a bad choice.  If buying now is even a remote option for you, you might be will advised to check in with a Realtor to see how practical and achievable that choice might be.  Five percent interest rates won’t last forever.

The housing market currently is a lot like the economy; pretty uncertain when this recession will be on the mend.  The stock market is up one day and down the next representing the uncertainty and anxiety of investors.  America Corporations are pretty much on the mend but hold expenses down by not hiring.  The millions of Americans out of jobs don’t yet see a light at the end of the tunnel.  Despite historically low mortgage interest rates, the housing market is slow to gain momentum.  With the more stringent lending guidelines, many potential buyers don’t qualify for loans and are renting; sellers who have lost their jobs or must move are trying to cope with slow sales, upside down mortgages and short sales, or the most traumatic experience of all — dealing with a foreclosure. Keep in mind that the Central Texas housing market continues to be one of the best, most active in the nation.  Here recovery is better, prices remained stable, and job growth is the envy of the nation. That says that we have less people with problems, but it doesn’t help the one who has a problem. As during the downturn of the mid eighties, a transaction process broadly referred to as “creative financing” can solve the problem for both buyers and sellers.  Anyone needing help should inquire about creative financing but should be very careful to insure that both the risks and rewards or advantages and disadvantages of such financing methods are very clearly explained and understood.  For anyone facing foreclosure or who must sell, or someone who needs to buy but can’t come up with a down payment, or qualify for an institutional loan, there are other and perhaps better options.  Call for information if you are in need of the long version.

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“You don’t concentrate on risks. You concentrate on results. No risk is too great to prevent the necessary job from getting done.” -Charles Yeager

Zero down – still a possibility for first time homebuyers, or those who haven’t owned a home in three years.  To compensate for the expiration of the Federal tax credit program, the State of Texas has produced a program of five hundred million dollars to fund low interest rates and down payment loans to qualified Texans.  The program, called the Texas Bond 77 program, enables loans with rates as low as 4.75% along with zero down payment.  The program administration is somewhat complex, but select lenders are well trained in the mechanics.  The program is a simple addition to the standard VA and FHA loans and compensates for the currently unfunded USDA program.  The USDA program that provides similar loans for Bastrop County residents is expected to be funded again later in the year. Stanberry agents handle the Bond 77 program by referring buyers to trained mortgage loan officers with participating lenders. Incidentally, virtually all economists predict that mortgage loan rates will increase by next year and unlikely ever again lower to levels currently available.

To celebrate Independence Day every year, many of our Realtor associates put out small replica flags in the sub-divisions where they work.  The agents usually get several calls of appreciation for the effort; often with expressions of a shared gratitude for the freedom that we Americans celebrate on that day. In one case this year, the issue of flags touching the ground arose, with observations that this resulted in disrespect of the flag and what it represents.  It was unfortunate that some of the plastic flags ordered for this purpose were larger than normal, and even more unfortunately, the staffs were too short resulting in some of the flags touching the ground.  In our company, we will hereafter remedy that situation by ordering miniature replica flags from the flag provider that serves the local American Legion.  We will also provide our neighbors with a card indicating protocol for the American flag.  Since the flag protocol was written specifically addressing and clearly aimed at the proper respect for the national colors, it is appropriate as a guide that should be followed to the extent possible in the use of miniature, representative or symbolic flags of any size or material that are used on holidays or special events to show pride in our nation and all that it represents..  We are proud of our America and like to show it and encourage others to do the same.

Here’s a fun article from the Austin American Statesman about Old Bastrop history and a good way to spend some time seeing the town. 

http://www.statesman.com/life/travel/bastrop-history-and-fun-within-spitting-distance-of-757331.html

Here are a few tidbits I picked up  this week that preview the rapid growth of our area:

-Bastrop is the 6^th fastest growing county in Texas

-10,000 acre Steiner Ranch residential development is currently underway

-Construction on new bridge across Colorado River in summer vicinity FM 969 and FM 1209 

-Second high school opens at Pope Bend and HWY 71 in August ‘10

-Construction is underway for the Bastrop Convention Center