What should I buy in a Recession?

September 25, 2009

I ran across an interesting list of the best items to purchase during a recession. Of course, this article is speaking to consumers that might actually have access to cash at this time and does not suggest purchasing any of these items on already extended credit. The online article in www.Time.com presented the list but the comments are my own:

Fancy Threads: A relative bargain at this time compared to year’s past as Designer’s are finding themselves with abundant inventory and lackluster high end clientele orders. Web sites like www.Gilt.com offer many designer items (clothing, purses, and jewelry) at much lower than retail prices. This is a member’s only site and sales are offered on regularly scheduled basis. This allows the designer to knock off prices online without negatively affecting the retail value on the showroom floor. (Plus, you get a $ 25 referral fee each time one of your referrals makes a purchase… great deals and rewards, too.)

Computer Memory: You will find pretty good deals on all computers and computer products at this time. Since it is relatively inexpensive to purchase a new computer, the costs associated with upgrades are lower at this time. However, with the fast pace of technological advances… if your laptop is more than a few years old, you will be better served comparing the costs of upgrades versus new.

Cameras – I love taking photos and anyone with a passion has to feed this passion with great gear. Prices for great quality digital SLR cameras are coming down so fast that I frankly do not see any reason to use point and shoot – except for having it handy for quick party shots or when you do not want to lug around the much heavier SLR. The new cameras are so intuitive that almost anyone can handle them yet they have manual functionality for the shooter who understands what he is shooting. I am a Nikon fan but there are many different and terrific makers to choose from. Check with your local camera store (not necessarily the big box department stores as their staff may not have the experience and brand knowledge necessary to help you find the right equipment for your level of expertise and shooting style).

Stuff for your House: I recently met with the owners of www.DirectBuyHouston.com who stated that their business is usually recession proof. Why? Because today, many of us stay home for a “Staycation” or decide to stay put as opposed to move, and our home becomes a priority. This time of year is a great time to purchase furnishings. Check first with the big name stores but also visit the little guy because he may just have the perfect, unique item you are looking for and at a great price, too. Don’t forget the discount stores like The Dump and Brandon’s… they have an ever changing showroom and offer great deals if they have what you want when you want it. Google “discount furniture Houston” and you will be amazed at what you find.

Lobsters: Funny, don’t know a thing about this one except that I love Lobster. Recently,HEB had lobster tails for $ 5.99 per lb. and they steamed them while I shopped. It does not get any better than that.

New Car: It is a no-brainer that cars are a good bargain right now – even with the makers that have not been bailed out by our Government. This is certainly not the time to pay “sticker price” for any vehicle. I would research your dream car, figure out the base costs and make an offer that will compensate the dealer fairly. I usually go straight to the Fleet Manager and avoid the floor guys (sorry guys and gals) because I want to avoid “the pitch”. I am in sales and hate nothing more than a sales pitch. The more you research and know before you go, the better your deal will be. But whatever you are offered in the deal…get it in writing!

Travel: Ahhh, my favorite topic. Great travel deals are everywhere and truly benefit those with flexibility to leave on short notice. Flights can be researched through a variety of web sites but I like www.Kayak.com because it will watch the fare for you and send you notice of up or downward pricing. Another great way to go is to cruise just about anywhere. My office mates and I are taking a 7 day Carnival Cruise in a few weeks and we paid barely over $ 600 total for 7 days… Do the math, folks… no air because we drive to Galveston, all food, room, entertainment (except our 2 excursions) and all the relaxation we can stand for less than $ 100 bucks a day. WOW! Try to get that deal anywhere on land.

Country Club Memberships: Private clubs are a luxury that has been hit hard with the recession and many are seeking new members with terrific incentives. Check out your local country club and ask for discounts… all they can say is NO. Of course I am like Groucho Marx… I may not want to join any club that would have meJ.

Houses: Glad to see this on the list as this is my area of expertise. First let me state that real estate is truly “local”. Before I suggest you go out and purchase property, you really need to check with a Realtor in your area. That said, our housing market is improving all across the nation and many areas have already bottomed out and are on the incline. Foreclosures are a good buy in some areas but not so in others (due to too many factors to illustrate here.) Again, check with a professional Realtor who knows the area, the market and the ramifications of purchasing a home at this time. If you are a first time home buyer… time is running short on the Tax Credit (although I truly hope our Senators will extend this fantastic incentive) so you may get another chance. Now truly is a terrific time to buy.

Stocks: Watch what the big guys do… Warren Buffett only buys when stocks are cheap and only sells when they are high. Sounds easy but when stocks are cheap (like now) most of us are still licking our wounds from recent losses and are afraid to purchase even more stocks so we tend to get conservative and put money in low yield mutual funds, CD’s, etc. Not really all that much better than putting it in their mattresses so it might just be a good time to take our heads out of the sand and dip our toes back in the stock market.

What would you add to this list?

Susan G. Komen Race for the Cure in Houston 10/3/09

September 24, 2009




Dear Friends and Family,

Our Prudential Gary Greene Katy office always takes on a project for National Volunteer Day. This year we are joining thousands of other volunteers in a race for life.

I recently accepted the challenge to raise a mere $100.00 funds to support the 2009 Komen Houston Race for the Cure® being held on October 3rd in downtown Houston.  For those that know me and my pitiful ankle (broken or actually “ruined” according to the Ortho four years ago and still recovering from 2 surgeries) understand if this turns into a “Hobble for the Cure” but it will be worth it.

Please join me in the fight against breast cancer by pledging your support in the Race. Your tax-deductible contribution will fund local innovative outreach, awareness and treatment programs for the medically underserved in the greater Houston community as well as national cutting-edge breast cancer research.  

Please click here to support my participation.  I truly appreciate your support and will keep you posted on my progress. I plan to post photos and a short blog about the actual event.


I am so proud of our Pink Brigade here at Prudential Gary Greene, Realtors in Katy, TX. We are all racing or walking in honor of Rosemay Derstler’s daughter Nicole and sister Linda, both undergoing treatment for breast cancer as well as Phylis and April who are living as proof of the cure.

Thank you for your generosity.  Imagine Life Without Breast Cancer.


Christi Borden

Mayonnaise Jar and Two Beers – Unknown Author

September 24, 2009

Mayonnaise Jar & Two Beers…
When things in your life seem almost too much to handle, when 24 hours in a day are not enough, remember the mayonnaise jar and the 2 beers.

A professor stood before his philosophy class and had some items in front of him. When the class began, he wordlessly picked up a very large and empty mayonnaise jar and proceeded to fill it with golf balls. 
He then asked the students if the jar was full. They agreed that it was..

The professor then picked up a box of pebbles and poured them into the jar. He shook the jar lightly. 
The pebbles rolled into the open areas between the golf balls. He then asked the students again if the jar was full. They agreed it was.

The professor next picked up a box of sand and poured it into the jar. Of course, the sand filled up everything else. He asked once more if the jar was full.The students responded with a unanimous ‘ yes. ‘ 

The professor then produced two Beers from under the table and poured the entire contents into the jar effectively filling the empty space between the sand. The students laughed.’ Now, ‘ said the professor as the laughter subsided, ‘ I want you to recognize that this jar represents your life.
The golf balls are the important things—your family, your children, your health, your friends and your favorite passions—and if everything else was lost and only they remained, your life would still be full.

The pebbles are the other things that matter like your job, your house and your car..

The sand is everything else—the small stuff. ‘If you put the sand into the jar first, ‘ he continued, ‘ there is no room for the pebbles or the golf balls.
The same goes for life. If you spend all your time and energy on the small stuff you will never have room for the things that are important to you. Pay attention to the things that are critical to your happiness. Spend time with your children. Spend time with your parents. Visit with grandparents. Take time to get medical checkups. Take your spouse out to dinner. Play another 18. There will always be time to clean the house and fix the disposal.
Take care of the golf balls first—the things that really matter. Set your priorities. The rest is just sand.
One of the students raised her hand and inquired what the Beer represented. The professor smiled and said, ‘ I ‘ m glad you asked. ‘ 

The Beer just shows you that no matter how full your life may seem, there ‘ s always room for a couple of Beers with a friend.

Should we extend the First Time Home Buyer Tax Credit?

September 24, 2009

Unless you have been living under a rock, you may have heard that the First Time Home Buyer’s Tax Credit is due to expire at the end of November and along with that, the incentive for new buyers to enter the real estate market. There are some that say this is simply a boondoggle for buyers who would have bought anyway without the monetary bonus. I beg to differ… in my opinion as a “boots on the ground” Realtor working with first time home buyers who were happy renters and only decided to purchase a home with the help and benefit of this incentive… hey, $ 8500 goes a long way toward helping with the down payment, new furnishings or paying the mover.

There are several versions of this bill before our legislators at the moment seeking an extension … which is supported by the National Association of Realtors. I know what you are thinking and yes, that does sounds a bit self-serving for Realtors to support a bill that will help sell real estate. Very much like if GM or Chrysler lent its support for the extension of the infamous Cash for Clunkers program.  But it goes a bit deeper than simply trying to protect real estate transactions. Another version not only seeks an extension but also broadens the coverage to any buyer – which would be a boon to the move-up segment of our society but may prove too costly to pass. Personally, I would love this version to pass but at a minimum, the first time home buyer is the consumer who will benefit the most from an extension of the existing plan.

According to the NY Times Online in a recent article released on September 15th,

“Mark Zandi, chief economist of Moody’s Economy.com, favors expanding the credit to all home buyers, even investors, into next summer. “The risks of not doing something like this are too great,” he said. “I don’t think the coast is clear.” James Glassman of JPMorgan Chase echoed those views but said he favored continuing to restrict the credit to first-time buyers.

On the other side of the issue is the Tax Policy Center, a joint venture of the Brookings Institution and the Urban Institute. It labeled the original credit as one of the worst provisions of the stimulus package, on the grounds that the money is a bonus for people who would buy a house anyway. The center has an even dimmer view of extending the credit to all buyers. “Is this the best way to spend money we don’t have?” asked senior fellow Roberton Williams.

Dean Baker of the Center for Economic and Policy Research called the credit “a questionable redistributive policy” from renters to home buyers, but said that he used it himself when he bought a house.”

Our nation’s economic health has been and will always be driven in part by our housing market. I agree with Mr. Zandi that while the costs for the credit is high, the cost of doing nothing is so much higher. We are sitting on the edge of recovery and this extension will help push us further toward the brighter future that exists around the corner. Be sure and drop an email or note to your legislator to let them know how important this issue is to your nation’s recovery.

If you would like more information about who qualifies for the current program, click here to visit my previous post “Understanding the First Time Home Buyer’s Tax Credit Before it is Too Late!”

West Houston… still a great environment for Builders

September 23, 2009

I ran across a great article in Builders magazine about recent home builder activity in our area highlighting both a start up builder and an oldie but goodie that has recently reorganized with local owners and local financing and how they are finding success in our master planned communities… all things point to postivie news for our area.

“…The startup, J. Kyle Homes, expects to complete construction of its first model by November at Park Place, a new neighborhood within Cinco Ranch, Houston’s top-selling master-planned community. Jason Hammonds, J. Kyle Homes’ president (Kyle is his middle name), says that market conditions have reduced lot prices to where his company can now get into a premium location that would have been out of its reach two years ago….”

While over 20 builders (Royce, Kimball, David Powers, etc.” have shuttered their doors, some abandoning lots and inventry, homes are still being built and sold everyday in our area. In fact, several of our communities and developers have received national recognition for increased sales in what has been considered a down-turn market.

“…Newmark Homes has already closed its first homes since it repurchased its brand from TOUSA on June 15. Newmark has operated in the Houston market for 26 years, but a clean break from TOUSA—the Florida-based builder that is winding down its business under Chapter 11 protection—is allowing this builder “to hit the reset button,” observes Jarvis. Indeed, Newmark’s president, Mike Moody, speaks of 2009 as his company’s “startup year…”

Newmark is currently building in only the strongest of master-planned communities: Cinco Ranch, Lakes of Bella Terra, etc. as these areas tend to attract buyers who are concerned about future appreciation and quality of life – which have a history of being stronger or more positive in highly controlled master-planned communities.

With positive economic indicators on a national level, our still strong job market, highly rated public schools, abundant commercial/retail for shopping, dining, entertainment… things still look good for the healthy suburbs of West Houston: Katy, Richmond, Sugar Land and more.

Quotes from Builder http://www.builderonline.com/local-markets/houston-remains-accommodating-to-builders-and-buyers.aspx

Latest Houston Housing Market Update from Christi Borden

September 23, 2009

September 2009 Newsletter Housing Trends eNewsletter

Welcome to the most current Housing Trends eNewsletter. This eNewsletter is specially designed for you, with national and local housing information that you may find useful whether you’re in the market for a home, thinking about selling your home, or just interested in homeowner issues in general.
The Housing Trends eNewsletter contains the latest information from the National Association of REALTORS®, the U.S. Census Bureau and Realtor.org reports, videos, key market indicators and real estate sales statistics, a video message by a nationally recognized economist, maps, mortgage rates and calculators, consumer articles, plus local neighborhood information and more.

Please click here to view the September Newsletter Housing Trends eNewsletter.

If you are interested in determining the value of your home, click the Home Evaluator link for a free evaluation report.

Social Media… ignore at your own risk!

September 9, 2009

I had the pleasure today to address an esteemed group of custom builders, members of the Greater Houston Builder’s Association and the subject today was Social Media and Marketing. Marketing for this group has always been very traditional. It is hard to imagine my being able to impress upon them the need to jump into The Groundswell… but I did and they were so interested that we have been asked to come back again to go deeper into this subject.

One of the things I spoke about is that I am the target market for a custom home buyer in Houston. I am a married Female of an age from 35 to 55 (not saying on which range I approach), dual income, heavy saver/investor, empty nester, etc. That said, I asked the audience how they were marketing to reach me with their message. And believe me, it is the woman making the decision here. What man in his right mind would look at his “paid off” home, low taxes, fully landscaped lawn, etc and say to his wife, “Honey, I think we should move…” Yeah, that is not happening.

So how are traditional marketers trying to reach “me”?

How about Print advertisements such as Houston Chronicle and magazines? No, this does not work because I download my Chonicle daily onto my Kindle DX (as well as magazines and books) and I do this for control, ease – only highlights and main articles and no advertising.

Radio? Well, no again… I listen to my iPod and Satelite Radio has effectively allowed listeners to have control over their music and again, avoid ads.

How about TV? Nope… other than the one news channel I watch live… anything else is recorded for later and again, ads are deleted.

So what is my message here? I am a pretty normal gal and not really all that techie but I am what I term “the hidden consumer”. I am hidden in the Groundswell and only respond to those seeking to reach me in my natural habitat.

So what is the lesson here? What worked yesterday, may not work today; and what will work today, most likely will not work tomorrow. Jump in the Social Media Pool… the water is warm and inviting.

Understanding the First Time Home Buyer’s Credit… Before it is Too Late!

September 7, 2009

1.   Who is eligible to claim the tax credit?
If you are a first-time home buyer purchasing a new home or a resale-you are eligible for the tax credit.  The purchase must take place on or after January 1, 2009 and before December 1, 2009 to qualify for the tax credit. As it applies to the tax credit, the purchase date is the date when the home closes and the title to the property transfers to the home owner.

2.   What is the definition of a first-time home buyer?
The tax credit law defines a “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. If you are married, both spouses cannot have owned a home.

For example, if you didn’t own a home but your spouse did, you do not qualify.  For unmarried purchasers, the credit amount can be given to any buyer who qualifies as a first-time buyer, for instance, if a parent jointly purchases a home with a son or daughter. If you owned a vacation home or rental property not used as a principal residence you are not disqualified as a first-time home buyer.

3.   How is the amount of the tax credit determined?
The tax credit is 10 percent of the home’s purchase price, however, there is a maximum $8,000 credit.

4.   Are there any income limits for claiming the tax credit?4.
The full tax credit amount is given to buyers with a modified adjusted gross income (MAGI) of less than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. For taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) the credit is reduced to zero.  Taxpayers between these figures are prorated accordingly.
5.   What is “modified adjusted gross income”?
Modified adjusted gross income or MAGI is defined by the IRS.   For most buyers this will be the figure at the bottom of the first page of form 1040 or 1040A.  For Form 1040 EZ this is reported on line 4 as of 2008.

6.   If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
Possibly. It depends on your income.

7.   Can you give me an example of how the partial tax credit is determined?
There is a $20,000 difference between those who are eligible for a full tax credit and those where the credit is reduced to zero.  If you take the amount you are over the limit by and divide it by the 20,000, this will give you the percentage that you are over the limit by.  Subtract that number from 100% and then multiply it times the $8,000.  That will give you your tax credit amount.

For example: A married couple has a modified adjusted gross income of $165,000. Their income exceeds $150,000 by $15,000. Dividing $15,000 by $20,000 yields 0.75.  This means they are over the limit by 75% and so are eligible for a tax credit of 25%.  Multiplying $8,000 by 0.25 shows that the buyer is eligible for a partial tax credit of $2,000.

Please remember that this is an example. You should always consult your tax advisor.

8.   How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?
The most significant difference is that this tax credit does not have to be repaid.  This tax incentive is a true tax credit. But home buyers must use the residence as a principal residence for at least three years or face having to repay it. Certain exceptions apply.

9.   How do I claim the tax credit? Do I need to complete a form or application?
You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on Line 69 of their 1040 income tax return. No other applications or forms are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests.

10.What types of homes will qualify for the tax credit?
Any home that will be used as a principal residence qualifies for the credit. This includes single-family detached homes, attached homes (i.e. townhomes and condominiums), manufactured homes (also known as mobile homes), modular homes and houseboats.  If it qualifies for the capital gains tax on a primary residence, it qualifies for this.

11.I read that the tax credit is “refundable.” What does that mean?
It means that the credit can be claimed even if the taxpayer has little or no federal income tax liability to offset.

For example, if you owe $6,000 in taxes and had $4,500 in taxes withheld for the year you still owe $1,500 in taxes.  You would receive a check from the government for $6,500.  ($8,000 – $1,500 = $6,500.)
Or perhaps more common would be that you have a tax liability of $6,000 and you had $7,500 withheld so you would be getting a refund of $1,500 before the credit – the credit gets added to your refund so you would get a refund of $9,500 ($1,500 + $8,000 = $9,500)
And you don’t have to have any tax liability in the year you claim the credit – but you do have to have income.

12.I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns.How can I claim the new $8,000 tax credit instead?
You may file an amended 2008 tax return with a 1040X form. You should consult with a tax advisor to ensure you file this return properly.
13.Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
Yes. The “purchased” date is the date the owner first occupies the house.  The date of first occupancy must be on or after January 1, 2009 and before December 1, 2009.

In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit isdetermined by the settlement date.

14.Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
Yes. The tax credit can be combined with the MRB home buyer program. Note that first-time home buyers who purchased a home in 2008 may not claim the tax credit if they are participating in an MRB program.

15.I live in a district where I am already receiving a first time home buyer credit (Washington D.C.)   Can I claim both credits?
No. You can claim only one.

16.I am not a U.S. citizen. Can I claim the tax credit?
Consult your tax accountant.  If you are NOT a nonresident alien (as defined by the IRS), have not owned a principal residence in the past three years and meet the income limits you may be eligible to claim the tax credit for a qualified home purchase.

17.Is a tax credit the same as a tax deduction?
No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

A tax deduction is subtracted from the amount of income that is taxed. Assuming the same $8,000 tax liability from above, a taxpayer is in the 33 percent tax bracket would have their liability reduced from $8,000 to $5,360. ($8,000 minus 33%).
So the tax CREDIT is much more helpful to the buyer

18.I bought a home in 2008. Do I qualify for this credit?
No, but you may qualify for another tax credit  if you bought  your first home between April 9, 2008 and January 1, 2009.
19.Is there any way for a home buyer to get the money before they file their 2009 tax return?
Yes. If you believe you will qualify for the tax credit you can reduce your withholding taxes on your paycheck by adjusting your withholding amount on your W-4 via your employer or through your quarterly estimated tax payment.  You can put this saved money aside to use as a downpayment.
IRS Publication 919 contains rules and guidelines for income tax withholding. Please note that if the qualified purchase does NOT occur, then you will be liable for repayment to the IRS of income tax and possible interest charges and penalties.  Consult your account prior to doing this.
20.If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
Yes. The law allows taxpayers the opportunity to treat qualified home purchases in 2009 as if the purchase occurred on December 31, 2008.

Taxpayers buying a home who wish to claim it on their 2008 tax return, but who have already submitted their 2008 return to the IRS, may file an amended 2008 return claiming the tax credit. You should consult with a tax professional to determine how to arrange this.
21.For a home purchase in 2009, Can I choose which year to claim the credit (2008 or 2009) to make sure I get the largest credit possible?
Yes.  You can choose to claim the credit in the tax year that will give you the greatest credit based upon your MAGI.  The purchase must take place in 2009.