p13, v7.33 — Business News & Trends

Business News & Trends

Mountain Views News Saturday, August 17, 2013

MVNews this week: Page 13

BUSINESS NEWS & TRENDS

Mountain Views News Saturday, August 17, 2013

CALIFORNIA HOME SALES HIGHER IN
JULY; PRICE GAINS CONTINUE STRONG
BUT TAPERING SAYS A.A.R.

California’s housing market bounced back after a slight dip in June to reach the highest level since
May 2012, as home prices continued to post strong annual gains and home sales recorded the first
annual increase in six months, the Arcadia Association of Realtors® reported.

“The spike in interest rates in June prompted home buyers to delay escrow closings in hopes that
rates would fall back,” said 2013 A.A.R. President Andy Bencosme. “As buyers recognized rates had
stabilized, they moved forward to close escrow, which lifted July’s sales from both the previous month
and year.”

Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted
annualized rate of 443,520 units in July, according to information collected by the California
Association of Realtors® from more than 90 local REALTOR® associations and MLSs statewide. Sales
in July were up 7 percent from a revised 414,670 in June and up 1.5 percent from a revised 436,870
in July 2012. The year-to-year sales increase was the first since December 2012, following six consecutive
months of declines. The statewide sales figure represents what would be the total number
of homes sold during 2013 if sales maintained the July pace throughout the year. It is adjusted to
account for seasonal factors that typically influence home sales.

The statewide median price of an existing, single-family detached home inched up 1.2 percent from
June’s median price of $428,620 to $433,760 in July. July’s price was 29.8 percent higher than the revised
$334,220 recorded in July 2012, marking 17 straight months of annual price increases and the
13th consecutive month of double-digit annual gains. The median sales price is the point at which
half of homes sold for more and half sold for less; it is influenced by the types of homes selling as well
as a general change in values.

“A constrained supply of homes over the past year has fueled robust home price increases, particularly
in the coastal regions,” said A.A.R. Executive Vice President Andrew Cooper. “Looking ahead, we
should continue to see strong price growth but at a less accelerated pace than what we’ve experienced
over the past year. Inventory levels are starting to build in some areas as price gains free up previously
underwater homes and encourage homeowners reluctant to list because of the scarcity of homes to
purchase.”

Other key facts of C.A.R.’s July 2013 resale housing report include:

• The available supply of existing, single-family detached homes for sale held steady in July at 2.9
months, unchanged from June’s Unsold Inventory Index. The index was 3.5 months in July 2012. The
index indicates the number of months needed to sell the supply of homes on the market at the current
sales rate. A six- to seven-month supply is considered typical in a normal market.

• The median number of days it took to sell a single-family home also held fairly steady at 27.8
days in July, compared to 27.7 days in June but was down from a revised 43.2 days in July 2012.

• Mortgage rates ticked up in July, with the 30-year, fixed-mortgage interest rate averaging 4.37
percent, up from 4.07 percent in June 2013 and up from 3.55 percent in July 2012, according to Freddie
Mac. Adjustable-mortgage interest rates in July averaged 2.66 percent, up from 2.60 in June but
down from 2.69 percent in July 2012.

Representing local Realtors® in the San Gabriel Valley for 89 years, the ARCADIA ASSOCIATION OF
REALTORS® (www.TheAAR.com) is one of the oldest trade organizations in CA. The AAR is dedicated
to the advancement of professionalism in real estate and is an advocate for private property rights.
A.A.R. is headquartered in Arcadia.

WHAT TO KNOW
ABOUT ESCROW

When you buy a home, or just make an offer, you will encounter the term "escrow account."
Like making a friendly bet and asking a third party to hold the wager money, the
"escrow agent" is the neutral party that holds funds in the interest of the mortgage lender
and the borrower.

When the terms of the purchase and loan agreements have been met, the money is released.
When your application is approved and the loan takes effect, the lender will likely
require money for property taxes and homeowner's insurance also to be held in escrow.
These funds are added to your monthly mortgage payment and disbursed when the tax and
insurance bills are due.

This protects the lender by ensuring a lien isn't placed against your property for non-payment
of taxes, and your home (their collateral) is protected against catastrophe. But escrow
also benefits borrowers by spreading the large annual payments for taxes and insurance over
twelve months.

For example, if your taxes are $1,600 per year and your insurance is $800, you're budgeting
a reasonable $200 per month instead of making two big payments. Escrow accounts do
not earn interest, so if you make a large enough downpayment, you may be able to avoid the
monthly escrow and pay the bills directly. Ask your agent and your lender about the pros
and cons.

BUSINESS TODAY

The latest on Business News, Trends and Techniques

By La Quetta M. Shamblee, MBA

BEWARE OF JOB PROMOTIONS THAT CREATE A PAY CUT

Before you step up to accept a promotion to
move into a management position, be sure
you’re not simply taking on more work for a
lower hourly pay rate. The distinction of being
classified as an exempt versus a non-exempt
employee is sometimes more about a perceived
career status than it is about higher overall
compensation for a more prestigious position.
Although there are specific legal distinctions,
one of the most commonly understood
characteristics of exempt employees is that
they are paid a salary. This is in contrast to
non-exempt employees who are paid an hourly
rate and must be paid extra for working beyond
their regularly-scheduled hours.

There are advantages to working as a salaried
employee but you want to be certain that the
advantages outweigh what you may be giving
up as an hourly employee. A colleague of mine
recently spoke with me about applying for a
job to replace her supervisor who had left for a
high-paying job at another company. Initially
she was very excited about the possibility of
moving into a salaried position with more
responsibility in her current department.
With her current compensation at about $24
per hour (roughly $50K annually), she was
being lured by the prospect of earning up to
$7K more per year. It seemed like a no brainer
until she considered the extra hours that she
would be expected to work above and beyond
the maximum of eight per day, or 40 per week
in her current role – that is, unless she was
going to be paid overtime at a rate of $36 per
hour.

She shared that the other employees in the
supervisor positions were routinely expected
to work a minimum of two to three extra hours
each workday, as well as being required to put
in an average of five extra hours each weekend
just to keep up with their workloads. This did
not include the numerous last minute “other
duties as assigned” that seemed to disrupt or
derail personal plans for the other supervisors
on a routine basis. She took time to do some
calculations and discovered that the big
promotion would result in a raise of $3.37 per
hour – and that was true if it only entailed
working 40 hours per week.

Once she added the extra hours that required
for the new position, she discovered it would
require a commitment of at least 55 hours
per week. This meant the big raise dropped
to an increase of only $1.87 per hour. Since
she worked at least five hours of overtime
each week at an overtime rate of $36 per
hour, it added up to an extra $9,375 per year
– at least $2,375 more than she would earn in
salary as a supervisor. For now, she’s chosen
the less prestigious, yet better paying position
that doesn’t include all of the stress of endless
meetings, nor the unreasonable expectation
of extra hours with no opportunity to earn
overtime.

DID YOU TAKE ADVANTAGE OF
SHARK WEEK?

Who knew that an annual TV show could spawn a marketing feeding frenzy.
Marketers and entrepreneurs across the county recognized this opportunity. They smelled the blood
(a.k.a. buzz) in the water. Ice cream stores advertised “shark” sundaes, news stations 1,500 miles from
any ocean featured “local shark stories,” and businesses across the country had shark week specials.
They leveraged an event that had us swimming in creative inclusion.

Events and holidays are great opportunities to reach out to your audience.

Take a look at the calendar and ask yourself; “Which events or holidays can we leverage to help
promote our business, products and services?”

1. What can you offer your audience?
2. How will they benefit?
3. What channels will you use to promote

Promote your specials in social media, on your web site, with printed materials, maybe a direct mail
piece, email marketing campaign and let your audience know about your offering. You may even want
to create an event and invite people to attend.

Staying top of mind with your customers, prospects, influencers, vendors, associates, followers, fans
and connections is what it’s all about.

About MJ: MJ and her brother David own HUTdogs, a creative services business that specializes
in Internet Marketing strategies. They are known for providing valuable information at their Social
Media and Email Marketing classes. “Like” them on Facebook for trending news in social media,
internet marketing and other helpful tips, www.facebook.com/hutdogs.