Low Mortgage Rates: But Can You Get One?
It couldn’t be a better time to buy your first home, or upgrade to a new one. In a report by the National Association of Realtors, the median price of a home fell to the lowest point in over a decade. The median price so far this year is $154,700, down from $219,000 just five years ago. Even more worrying to sellers and the market in general is that prices are forecast to fall even more over the first quarter of the year.
One big reason for housing prices not being able to rise is the growing number of foreclosures and short sales. The low prices coupled with the high number of foreclosures have resulted in the highest number of sales in close to a year. Other big factors in the rise of home sales, along with the low prices, are the current record low mortgage rates and other factors such as the up-swing in employment and the price of renting either equaling or exceeding what a mortgage payment would be.
But there is a catch to the low mortgage rates and it doesn’t help the average buyer.
While we’re seeing the lowest prices of homes in over a decade and record setting mortgage rates, only those with near perfect credit scores can obtain the best rates. Even the ones with a few slight credit blemishes are being turned away or at the best given higher rates. It’s a glaring trend that is leading to only the wealthy being able to receive the lowest advertised rates.
Another trick lenders are applying is the minimum down payment they’re requiring. So on top of the extremely hard to get rates, banks are looking for 15-20% down. This is making it hard on many young first time buyers.
While housing prices continue to fall month after month and mortgage rates drop almost daily, it is becoming harder for average and low income families to purchase a home.
Read More»There’s No Such Thing as a Free Car
My parents purchased their third vehicle on the weekend. I asked what they were doing with the 3rd car that they clearly didn’t need (as it is only the two of them) and they replied “Ohh, we thought we’d give it to you or your sister!”
Although I appreciated their gesture of a “free” car, I know all too well that you can not have a free car in the city of Halifax, Nova Scotia. Per month, it would be at least $100 for insurance, $100 just to park it in the underground parking of my apartment building, $100 if I want to pay for a parking spot somewhere beside my work, and with the price of gas these days you might as well add another $200 onto that estimate.
So, $500 per month later, I’d be cruising around in my “free” car. I guess I’ll stick with walking- that’s actually free (minus the infrequent cost of a pair of new sneakers) and it burns calories!
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Cash Is King
Entrepreneurs are the dream makers. They have the ideas that create the next big thing. They have the ability to visualize, and almost as from clay build an idea into their reality. Many times their energy is transferred to those who believe in the dream. In the early days this is often enough.
Never forget that once the dream has taken form the entity becomes what we refer to as a business. Everything can change depending on whether or not the principles of buisness are adopted and adhered to. For in this concrete world cash is king. Keep your dream alive but remember that business is unforgiving. It is like a furnace or an engine that must be constantly fed.
Lay out your plan to satisfy the engine of buisness along with your vision of how your dream can change the world. They are not incompatible and the creation of wealth is indeed one of the purposes of creating a business. So along with the design of your product or service, create a plan for the constant flow of cash. In our terms it is known as the cashflow sheet. Don’t be side tracked and leave this to the accounting clerk who knows very little , if nothing about how to create cash for your business. Worry less about profits and more about cash and you will be on the right track for making your dream or vision a reality.
Read More»The Business Behind Infomercials
The Business Of Selling
We’ve all seen quite a few infomercials over the course of our lifetimes, and chances are you’ve been intrigued by an item or two. Why not let a decorative glass bulb water your plants for you, or store all your sweaters under the bed in a suctioned, flattened bag? While infomercials have a bad reputation for being cloying, annoying, and occasionally misleading, they and their products are big business.
Using As Seen on TV logo has become an especially profitable way to increase awareness of a direct response mail order product, and As Seen on TV products are also now being sold all over the net through countless web vendors. Many products are now even available at traditional retail outlets, where they sell at a brisk pace. The As Seen on TV products are also being bolstered in popularity by their new status as pop culture fodder. Who hasn’t laughed out loud at the “ShamWow guy” Vince Shlomi as he implored you to start slapping your troubles away with the As Seen on TV product the Slap Chop? Billy Mays’ recent tragic death has played a role in the As Seen on TV pop culture phenomenon as well, as web tributes to the TV salesman have popped up on many websites and blogs.
So much excitement would not surround As Seen on TV products if they weren’t extremely profitable. While most industries have been squeezed by the recession, As Seen on TV products continue to sell at a healthy clip, and advertising for the products has seen increased spending.
Telebrands, probably the largest supplier of As Seen on TV products, is worth over $100 million. Discerning exactly how much is being made off of these products and which medium (TV, web, or retail) is most profitable, however, it is a difficult business due to the wide variety of independent vendors that have proliferated on the web. Part of the secret to the As Seen on TV profitability is their clever pricing. You may have noticed that infomercials never seem to give an exact, full price for the product being offered. Usually the item is offered for several small payments, or a price is offered for multiple items “plus separate shipping and handling.” This is a calculated move on the part of the hucksters, who understand the psychological aspect of buying using smaller increments. Even though the price isn’t any cheaper simply because it is broken up into small increments, it still feels that way to the buyer. Infomercials and web based As Seen on TV vendors also use false scarcity methods and time constraints to goad people into buying impulsively. The items also sell for more obvious reasons: many solve common problems, or at least claim to solve these problems, such as the Purse Hook, which keeps purses and small bags from being left on the floor, or the popular Ped Egg, which not only shaves calluses but traps the debris.
For more about profits please visit our Finances section on GKBusiness.
Read More»Going Green Business Initiatives
The Business Behind Going Green
The market for green products, green taxes and green publicity has boomed over the last few years, and many businesses are earning millions of dollars in profit every single day thanks to the booming green industries. But where is the money actually going? Is it actually helping save the planet, and how long will it last for?
The green taxes have raised tens of billions and the green businesses themselves have boomed, with green energy companies estimated to have made $138 billion in 2009 alone. These values are pretty impressive, however with many of the green taxes being ‘redeployed’ and many companies suffering from carbon tax red tape.
While there may be a lot of current investment in green business, it is unsure how long it will last. The current science behind the current carbon crisis has been put under question, and many scientists are now saying that the money being invested in the relatively unproven carbon based climate change could be better spent elsewhere with worldwide deforestation and overall pollution.
A lot of the global funding is currently being spent investing in current green technologies. Some businesses are making a fortune out of this. However, green political parties are now suggesting that some of this money be invested in researching further into renewable energies which could be harnessed.
The business behind going green remains a profitable area, despite this opposition, and it can only be a good thing for the environment and the world around us. These green investments have been creating wind and solar farms around the world. You would think this would be helping to boost the countries investing the most in green technology.
However this may be a false hope, countries such as the United Kingdom have given huge subsidies for wind farms in the UK, and off its shores. The subsidies that were promised as a boon to the British economy stalled early on, and much of the money ended up going to both German and French companies. The United States suffered a similar issue, with much of its green stimulus money ending up in China, which is coincidentally where most of the financing actually came from, rather than from US banks.
The good news is that since many of the green subsidies are going to countries outside of the US, there will be less impact when the hype behind the green movement dies down, and die down it will.
The recorded temperatures of 2008 show that the last ten years have erased nearly all the progress of global warming in the last 100 years. In fact this recent drop in temperatures has re-ignited worries that emerged 40 years ago of a mass global cooling, which looks at world temperatures on a much larger scale.
This in itself has caused massive friction in the green parties, since the global cooling theory was one which suggested dumping carbon dust over the polar ice caps to reduce reflected heat to help keep the earth warm. This is a huge contradiction to current green policies, and has of course sparked some serious controversy, as well as threatening the business behind going green.
For more great articles concerning business growth please visit the Business Growth section on GKBusiness.
Read More»The Business Of An Uncapped NFL Season
The Business Behind The NFL
2010 marks a vast change for football players, team owners and fans alike. The Collective Bargaining Agreement (CBA) under which the National Football League (NFL) has operated for over 90 years has expired. This means big changes in the way teams operate, how they ‘buy’ new players and how fans will experience the game. One of the biggest changes is the removal of the salary floor and ceiling. Under the CBA, teams had to adhere to a strict set of rules.
The salary for each of their players had to fall between the salary floor and ceiling. In theory, this was supposed to foster competition and to keep things fair. Without the salary ceiling, players could ask for, and most likely receive almost any amount of money, as long as they were good enough. 2010 marks the first year there will be neither a ceiling or a floor for salaries.
Another big change regards how free agents are handled. Previously, players need only four years of experience to become unrestricted free agents. Under the ‘uncapped’ rules, player now need six years of experience. The final eight teams from the 2009/10 season will also be restricted in the number of unrestricted free agents they can sign.
Under the current ruling, none of the NFL teams will have a reduction in funds. This is because NFL teams primarily find income in the form of revue sharing. Simply put, the NFL teams all receive identical funds from a television contract. In fact, it is estimated that 2/3 of the revenue that teams receive is from revenue sharing. Other sources of income such as gate sales and concessions play a role as well. Still, it is unlikely that teams will see a reduction in funds available to them.
The uncapped season shouldn’t, in theory have a huge impact on teams, mainly because of the revenue sharing agreement. However, there are still ‘rich’ teams and poor teams. The difference between the Dallas Cowboys, one of the wealthiest teams, and the Indianapolis Colts, one of the poorest, is extreme. It is likely that some of the poorer teams will have to implement a series of cost saving measures in order to remain competitive – they simply will not have the budget to sign big ticket players.
The uncapped year does make some attempt at remaining fair. The cap on the number of unrestricted free agents that the top eight teams from the previous season can sign is meant to even the playing field. Unfortunately, there is no way to even things out monetarily. Teams that have had poor seasons in recent years are unlikely to be able to afford some of the uncapped salaries. It is likely that the wealthier teams will manage to sign the top talent, while the poorer teams, even after implementing cost saving measures will be stuck with the leftovers.
One is left to wonder if the uncapped year is a positive change. In theory it is, but only time will tell if the new system is equitable.
Read More»What Is Geo-Fencing?
Placecast’s New Marketing Pitch
Most of us have heard about Geo-Fencing Technology used for security purposes that make sure children don’t leave school before the end of the day, or to notify you when your car is leaving a designated area and may be being stolen. The broad definition of a “Geo-Fence” is a virtual border that surrounds an actual geographic area. Once a geo-fence is established, a location based service can send a notification through text or email when a specific device enters or exits the geo-fenced area.
Placecast and other location based mobile ad companies are taking geo-fencing to its natural commercial extension, by creating location based text message advertisements for businesses who would like to reach customers (who have, of course, chosen in advance to opt-in for the service) whenever they are close to a storefront or other designated area.
Placecast’s marketing service is called ShopAlerts and works on any mobile phone, unlike many other mobile advertisement applications which work only on smart phones. Placecast will use either the phone’s GPS signal, proximity to cell towers, or data purchased directly from carriers to pinpoint the location of a subscriber’s cell phone. Consumers who opt in to Placecast’s ShopAlerts service are able to pick their preferred brands out of a list of retailers who have constructed a customized version of the ShopAlerts service. Consumers don’t have to go far to opt in to the service, either. This step can be taken at the store itself, online, through text message, or through social networking sites such as Facebook. Once the activation process is complete, whenever that consumer is near a location of one of their selected retailers, they are sent a text message alert.
The geo-fencing technology should be very helpful to businesses, which will be able to lure potential customers into stores with promises of discounts, promotions, or new inventory. Businesses also can use the technology to as a new way to strengthen their brand and communicate with customers, through branded informational texts that can be sent whenever an opted-in cell phone enters a corresponding geographical location. For example, Placecast client The North Face can text information about weather conditions whenever people enter certain hiking trails or national parks. While this might seem like a lot of texts, Placecast is aware of the potential of advertisements to overwhelm and annoy, so a maximum of only three texts are sent per week.
Even if the texts don’t get people directly in the door, geo-fencing still works well from a marketing perspective. Companies which send useful texts, whether they are about sales or simply generally informative, will benefit from increased brand awareness and association with a specific location. ShopAlerts is easily integrated into existing marketing programs and calendars. Early pilot programs for the ShopAlert service were overwhelmingly successful with a vast majority of positive reviews from consumers. And while geo-fencing hasn’t quite yet caught on with most advertisers, interest is steadily building as more money is spent each year on interactive mobile advertising.
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