Unfinished development project destroyed by lightening

 The NW Philadelphia  real estate market remained relatively stable inspite of the 2009 recession.  Real damage resulting from the boom market excesses of previous years, while painful, has been limited.  But we have not been spared changes resulting from a global financial crisis.

 NW Philadelphia, like the rest of the country, has been changed by the behavior of the big banks, by Fannie and Freddie, and by HUD. For an overview of the decade, and how we got to the 2009 real estate market, Boom and Bust: A Decade of Misadventures in Real Estate – Developments – WSJ offers a collection prescient articles.  

We will remember 2009 as the year when the ‘too big to fail’  banks got bailed out, and became bigger; when new regulations were implemented to stop past abuses, and created new problems;  when the Fed tried to prop up home sales with a Tax Credit, and qualifying for financing became more difficult. Meanwhile  new opportunities became available for those who were looking out for them.  

City of Philadelphia Advertises Housing Counseling Services

To end the year, here are my Top 10 Trends in NW Philadelphia Real Estate in 2009:   

1. Prices in NW Philadelphia fell overall to 8-12% below the high of mid-2007 making homes more affordable, but not drastically depreciated.
2. Interest rates stayed at all time lows making refinancing and 1^st time home buying attractive, if not always attainable.
3. An $8000 Tax Credit created a min-boom in residential home sales, in the $100,000 to $400,000 price range, in November.
4. Quality renovations in selected neighborhoods sold at a premium, providing incentives for well-funded, quality developers.
5. New appraisal rules were adopted preventing mortgage originators from directly hiring or communicating with the appraisers for the properties they were financing. Appraisals became unpredictable, sometimes arbitrary, leading to re-negotiation or the termination of many home sale.
6. Private mortgage insurance became unavailable, restricting loan options to government insured FHA loans with 3 ½ % down payment, or conventional loans with 20 % down payment.
7. Condo sales slowed, and ’spot’ FHA approvals for condominiums became unavailable, leaving only conventional loans for most condo financing.
8. Act 91 offered help to home owners facing foreclosure negotiate loan modifications or sell properties with short payoffs, while the lenders stalled and made the process daunting.
9. Financing for commercial properties became more and more difficult to get for most borrowers, foreshadowing problems in the future.
10. Stimulus programs, and grants were a bright spot, bring  funds to the area for projects including renovating train stations and up-grading business facades to the area a more attractive and better place to live.
    

    Able Plumbing Gets a New Look

Looking back, the year was full of changes both challenging and frustrating. Many people couldn’t do what they wanted to do, whether it was to buy, sell or refinance. At the same time the overall impact of recession has been much less in NW Philadelphia than elsewhere, and there were new opportunities for the making the area a more desirable place to work and live.

 The Numbers:

The following table contains average sales prices and units of homes on the MLS in North Scottsdale, which is comprised of zip codes: 85258, 85260, 85255, 85254, 85259, 85262. All information is specific to the 11/30/2009 through 12/31/2009 and 11/30/2008 through 12/31/2008. All of this data is pulled from ARMLS’ Home Listings Database.

Comparing the last month of 2008 versus the last month of 2009 we see a 14% decrease in the average sales price of all homes sold ($543,023 to $466,353) and a 104% increase in number of transactions (206 to 420).

When we focus on short sale transactions we see only a 3% decrease in average sales price ($400,595 to $387,291); however, there is a dramatic increase of 319% in individual transactions (21 to 88). This change increase in individual transactions is most likely connected to the general improvement of lenders’ short sale systems. They are getting better at approving short sales.

Lenders also have an increased willingness to perform short sales that is most likely attributed to the continued onslaught of REO properties. REO transactions were up 103% (56 to 114). The lenders receive all of the proceeds from a sale of a short sale and a REO sale. As this data indicates the banks end up cutting their losses by roughly $20,000 per transaction by allowing a short sale versus going through the foreclosure process. This “savings” does not even include the costs associated with doing foreclosures such as attorney fees and the liabilities of property maintenance, taxes, etc. The long story short is that from a purely dollar and cents view, when deciding between allowing a short sale and going through foreclosures, banks lose less money by doing a short sale.

What is not shown in these numbers is the amount of profit banks make by not allowing a short sale on an individual that does not go into foreclosure, but rather pays off their note in full. When people hear that banks are giving short sales, whether they need one or not to avoid foreclosure, there will be some individuals that try to take advantage of the situation and cut their losses, at the bank’s expense, on an investment that lost equity.

The following table contains units of homes on the MLS in North Scottsdale, which is comprised of zip codes: 85258, 85260, 85255, 85254, 85259, 85262. All information is specific to 12/29/2009 and is pulled from ARMLS’ Home Listings Database.

Of the 3,449 homes on the market in North Scottsdale, 22% of them are short sales and 8% are bank owned. Of the homes under contract and pending close of escrow, 39% are short sales and 22% are bank owned. Of those 741 homes on the market that are short sales 39% are listed as Active with Contingent Offer, meaning that there is an offer submitted to the bank for short sale approval.

While 71% of the homes on the market are regular resale (not short sale and not bank owned), 39% of the homes that are pending are short sales and 22% are bank owned. Of all the homes that are pending, 45% are bank owned and 28% are short sales.

We have a 45% ratio of number of homes that are bank owned and pending to the number of homes that are bank owned and active but only an 8% ratio of regular resale pending to regular resale actives.

When looking at the homes that have closed in the last 30 Days we see that as a percentage of the total closed units 53% are regular resales; however, we see a similar ratio of Closed Sales and Active Sales as we do with the Pending Sales. With 2,446 active regular resale homes as compared to 262 active bank owned homes you would expect to see a much larger number of closed regular resale homes.

Second homes made news in 2009, but unlike a few years ago they were not the center of attention, with foreclosures and general economic woes taking center stage.

Private Communities Newswire polled thousands of monthly visitors to see if they thought second homes would make a comeback in 2009; a robust 52 percent said “yes,” 37 percent said “no” and the other 12 percent of responders were “not sure.” The poll conducted through “polldaddy.com” was not scientific, but it did show those who have an interest in the second home market are still in the game either as shoppers, real estate professionals or sellers.

The Tennessean Media Group's Snapshot of Boomers

It is possible that second homes will become more popular in 2010 with some select buyers like baby boomers, some who still have the means to make the lifestyle change from one to two homes. Even a souring economy is not likely to curb some independent-minded boomers who have had their hearts set on the decision for decades.

Expect those with second homes to get more use out of them as they consider their own future plans and face another cold winter in some regions.

The housing industry faced similar tough times in the early 1990s and it was the boomers who helped fuel a real estate expansion to the Sun Belt and even in locations closer to home. If they do it again, it could be a gradual increase rather than another boom. Please share your 2010 predictions with us.

It truly is better to give than to receive… unless you are an apartment owner.  Even owners with the largest of hearts don’t find virtue in concessions, such as “3 months free rent” or “free plasma TV,” decreasing rents and a lack of liquidity in the market.

As the apartment market continues its “slide” (for reasons both real and perceived), the Jansen Multifamily Team is reminded of the classic scene in A Christmas Story when Ralphie “chokes” on Santa’s lap, unable to request the gift he covets; rather, he simply nods “yes” to “a football” as Santa’s crass elves attempt to hastily push Ralphie down the “Santa slide.”  In an instant, Ralphie snaps out of his trance, plants his feet into the slide to halt his descent and blurts out, “No! No! I want an Official Red Ryder Carbine-Action Two-Hundred-Shot Range Model Air Rifle!”  This is the Jansen Multifamily Team’s “moment on the slide.”

Our 2009 Holiday Wish List:

Increased Liquidity in the Market (particularly from local banks rather than agency lenders)

Over the past year, it was abundantly clear that the only viable lenders in the apartment finance game were government sponsored entities – Fannie, Freddie, and, to a lesser extent, FHA.  These lending sources have provided liquidity to would-be apartment buyers, but have not been immune to the increasingly strict underwriting criteria pervasive in the capital markets, for both properties and the borrowers attempting to purchase them.  Had it not been for the GSEs, it is safe to say that the number of units sold in 2009 (already the lowest amount since 1976) would have been reduced by at least half.  Simply put, leverage drives returns, making finance the most critical component of the apartment investment market.  In order for a 2010 rebound to take place, lending must become more accessible to prospective buyers, particularly individual investors and local investment groups.  “Accessible financing” must manifest itself in the form of competitive portfolio loans from local banks that understand the fundamentals of their local markets.  The Fed has announced it will stop purchasing GSE securities by the end of March 2010, thereby eliminating many of the subsidies that are keeping agency loans competitive.  Fannie and Freddie have already projected they will have lower volumes in 2010, and without an appropriate response by local banks to fill the void left by GSE contraction, apartment investments will grind to a screeching halt.

Absorption of New Units

Another crucial element to any recovery will be the absorption of both existing and new units on the market.  The rental market is fundamentally governed by the laws of supply and demand, and stability depends on the equilibrium of the two.  Puget Sound apartment owners have been contending with an oversupply of units over the past year, spurred by overdevelopment of multifamily units (particularly in core King County markets) and reconversion of failed condo projects to apartments.  When supply so drastically outpaces demand, the result is downward pressure on rents and occupancy.  The only path to equilibrium – and the sanity of apartment owners – requires filling the existing supply of units, a move that will be possible with the fulfillment of our next wish.

Job Growth

The clearest path to recovery in the apartment rental market, and the economy in general, is job growth.  Job growth brings people to the Puget Sound region and provides them with income.  Job growth creates demand for all the things an employed population needs, such as housing and durable goods, and is the key to reversing the current market trends of concessions, falling rents and decreasing occupancy.

Bridging of the “CAP Gap”

Aside from the realities of the capital markets, the next largest obstacle to putting a successful transaction together is the “CAP gap” between buyers and sellers.  Essentially, this refers to the difference in the conception of property value between buyers and sellers.  Many sellers are unwilling to accept the fact that their property values are not what they were in 2007/8 as credit has tightened, converters have gone out of business, and buyers require positive financial leverage, thereby driving up CAP rates.  Many buyers, on the other hand, are looking to “steal” properties by using fear and market uncertainty in an attempt to drive CAP rates to levels seen only in Detroit or other markets that lack the Seattle MSA’s strong fundamentals.  The “sweet spot” is somewhere in between these two extremes, and closings will not take place until both buyers and sellers can get realistic about what a “market” transaction looks like.

Social Darwinism

Real estate professionals, be they investors, lenders, or brokers, need to be proactive.  In an ever-changing market, proactive professionals will separate themselves from the “herd” through superior education, expertise, strategy, vision and execution.  The Puget Sound apartment market is filled with immense opportunity, which is why the Jansen Multifamily Team wishes for lenders to lend, investors to invest, owners to reevaluate their current holdings, and brokers to intelligently advise and educate their clients.  Those in the real estate industry who take a proactive approach to tackling market realities will “rise to the top,” while those who take a passive approach to the market are not likely to survive.  As a result, the best investors, lenders and brokers in the business will thrive, thereby reestablishing a solid foundation upon which our market can again grow.

Initially, Ralphie’s Red-Ryder holiday wish went unfilled in A Christmas Story. It seemed that all hope was lost for the main character of this holiday classic as St. Nick responded, “You’ll shoot your eye out, kid.” However, when Christmas morning came, Ralphie got his wish.  Similarly, our 2009 Holiday Wish List may be nothing more than “wishful thinking” in the short term.  Eventually, however, banks will start lending, employers will start hiring, new hires will rent apartments and buyers and sellers will agree on market realities.  Most importantly, those real estate investors, lenders and brokers who proactively pushed through the market downturn will be poised to capitalize on the market’s eventual recovery.

The Jansen Multifamily Team wishes you and your families a joyous holiday season and a Happy New Year.

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Settling down to a desirable spot that you can call home means something different to many people today than it did a few years ago.  Americans once flocked to Sun Belt and coastal cities like Vegas and Orlando where they could easily buy homes in areas where home values were expected to noticeably appreciate.  However, nowadays, most Americans are seeking solid housing markets, desirable cost of living, stable employment and quick commutes in the community they call home.  Forbes Magazine has recently released a new list of America’s most affordable cities to live.

They compiled the list from cities that offer the most bang for your buck by looking at America’s 100 largest metro cities and measuring important statistics such as foreclosures, vacancies, unemployment rates, a three year home-price forecast, median commute time and median real estate taxes. 

Omaha, NE topped the list with the biggest bang for the buck city and was joined by several other Great Plains metro cities, one of which we proudly serve.  Below, we have listed 20 of America’s most affordable cities to call home.

* Omaha, NE

* Little Rock-North Little Rock-Conway, AR

* Jackson, MS

* Des Moines- West Des Moines, IA

* August, GA

* Wichita, KS

* McAllen-Edinburg-Mission, TX

* Chattanooga, TN

* Colorado Springs, CO

* Ogden-Clearfield, UT

* Scranton-Wilkes-Barre, PA

* Columbia, SC

* Harrisburg-Carlisle, PA

* Provo-Orem, UT

* Syracuse, NY

* Baton Rouge, LA

* Buffalo-Niagara Falls, NY

* Palm Bay-Melbourne-Titusville, FL

* Tulsa, OK

* Greenville-Mauldin-Easley, SC

Here is the full list of all 100 cities.

Realtors® Tom & Bev Herring – Helping You With Your Tulsa Real Estate Needs

Search Tulsa, OK Homes for Sale

What a difference a year makes and as we approach 2010, it’s interesting to note the hot trends that are ‘in’ in real estate.  Cyberhomes.com recently published a great article about 2010’s real estate trends —and the overriding theme is that in our current economic climate homebuyers are looking for quality and value more than luxuries and extravagance.

Photo: iStockphoto

So what are the top 5 trends?

-Smaller homes

-Open floor plans

-Dual home offices

-‘Green’ details

-Extending the indoors outside

The article gives important reasons to support why these trends are so hot for 2010.  We’ve seen these trends coming and I’m honored that I was able to contribute the trends we experience to this piece.  As the new year draws upon us, there’s no time like the present for sellers to pay attention to what’s in demand.

First Time Homebuyer Tax Credit Extended Into 2010!
Plus…A New Tax Credit for Certain Existing Home Owners!

It’s official. President Obama has signed a bill that extends the tax credit for first-time homebuyers (FTHBs) into the first half of 2010. This program had been scheduled to expire on November 30, 2009.

In addition to extending the tax credit of up to $8,000 through June 30, 2010, the extension measure also opens up opportunities for others who are not buying a home for the first time.

So Who Gets What?
The program that has existed for FTHBs remains intact with the one exception that more people are now eligible based on an increase in the amount of income someone may now earn.

Additionally, the program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.

Deadlines
In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.

Higher Income Caps in Effect
The amount of income someone can earn and qualify for the full amount of the credit has been increased.

Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible.

Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.

Maximum Purchase Price
Qualifying buyers may purchase a property with a maximum sales price of $800,000.

First-Time Homebuyer Tax Credit – Frequently Asked Questions
Here are answers to some commonly asked questions about the tax credit.

What is a tax credit?
A tax credit is a direct reduction in tax liability owed by an individual to the Internal Revenue Service (IRS). In the event no taxes are owed, the IRS will issue a check for the amount of the tax credit an individual is owed. Unlike the tax credit that existed in 2008, this credit does not require repayment unless the home, at any time in the first 36 months of ownership, is no longer an individual’s primary residence.

What is the tax credit for first-time homebuyers (FTHBs)?
An eligible homebuyer may request from the IRS a tax credit of up to $8,000 or 10% of the purchase price for a home. If the amount of the home purchased is $75,000, the maximum amount the credit can be is $7,500. If the amount of the home purchased is $100,000, the amount of the credit may not exceed $8,000.

Who is eligible for the FTHB tax credit?
Anyone who has not owned a primary residence in the previous 36 months, prior to closing and the transfer of title, is eligible. This applies both to single taxpayers and married couples. In the case where there is a married couple, if either spouse has owned a primary residence in the last 36 months, neither would qualify. In the case where an individual has owned property that has not been a primary residence, such as a second home or investment property, that individual would be eligible.

As mentioned above, the tax credit has been expanded so that existing homeowners who have owned and occupied a primary residence for a period of five consecutive years during the last eight years are now eligible for a tax credit of up to $6,500.

How do I claim the credit?
For those taking advantage of the tax credit in 2009, you may choose to either apply for the credit with your 2009 tax return or you may apply for the credit sooner by filing an amended 2008 tax return with Form 5405 (http://www.irs.gov/pub/irs-pdf/f5405.pdf).

Can you claim the tax credit in advance of purchasing a property?
No. The IRS has recently begun prosecuting people who have claimed credits where a purchase had not taken place.

Can a taxpayer claim a credit if the property is purchased from a seller with seller financing and the seller retains title to the property?
Yes. In situations where the buyer purchases the property, even though the seller retains legal title, the taxpayer may file for the credit. Examples of this would include a land contract, contract for deed, etc. According to the IRS, factors that would demonstrate the ownership of the property would include: 1. the right of possession, 2. the right to obtain legal title upon full payment of the purchase price, 3. the right to construct improvements, 4. the obligation to pay property taxes, 5. the risk of loss, 6. the responsibility to insure the property and 7. the duty to maintain the property.

Are there other restrictions to taking the credit?
Yes. According to the IRS, if any of the following describe your situation, a credit would not be due.

• You buy your home from a close relative. This includes your spouse, parent, grandparent, child or grandchild.
• You do not use the home as your principal residence.
• You sell your home before the end of the year.
• You are a nonresident alien.
• You are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any taxable year. (This does not apply for a home purchased in 2009.)
• Your home financing comes from tax-exempt mortgage revenue bonds. (This does not apply for a home purchased in 2009.)
• You owned a principal residence at any time during the three years prior to the date of purchase of your new home. For example, if you bought a home on July 1, 2009, you cannot take the credit for that home if you owned, or had an ownership interest in, another principal residence at any time from July 2, 2006, through July 1, 2009.

Can you buy a home from a step-relative and be eligible for the credit?
Yes. Provided the person you are buying a home from is not a direct blood relative, the purchase would be allowed.

Can parent(s) who will not live in the property cosign for a mortgage for their child and the child that is a qualifying FTHB still be eligible for the credit?
Yes.

Can a separated spouse who has not owned a home for four years qualify for the FTHB tax credit if the spouse has owned a property anytime in the last three years?
No. However, the spouse may be eligible for the repeat buyer credit. The best path to take in any situation regarding income taxes is to speak with a professional tax preparer or CPA.

If you have any questions that fall outside the situations here, give me a call and if you do not have an accountant to speak with, I can refer you to one.

Time and time again, publications and economists alike make bold attempts to predict where our national economy is headed over the next 6 months, year, or longer.  Economists use key indicators such as Gross Domestic Product and unemployment in order to paint a picture of our future economy.  Unfortunately, these indicators have been heavily influenced by government intervention, rendering them all but irrelevant if capital markets refuse to supply liquidity to the marketplace.   The stability of the Puget Sound apartment market is directly connected to the performance of our national economy.  If the Puget Sound apartment market was one tree, the leaves would be the national economy, the trunk would be employment, and the roots would be the capital markets…  and no tree can survive without strong roots.

The broadest measure of the national economy is the Gross Domestic Product (GDP).  GDP is the output of goods and services produced by labor and property located in the United States.  Per the U.S. Department of Commerce Bureau of Economic Analysis, GDP increased at an annual rate of 2.8% in the third quarter 2009. This is good news compared to the previous four straight quarters of declining GDP.  Consumer spending is the biggest factor in assessing GDP.  So how accurate is the third quarter 2009’s increase in GDP?  The third quarter saw massive government spending and intervention with the “Cash for Clunkers” program as well as the $8,000 tax credit for first time home buyers.  With short term solutions for short term gains, it is not surprising to see positive growth in the GDP.  Just as any tree with large leaves and ample sunshine strengthens its trunk into a strong and healthy organism, one would speculate that such a large increase in GDP would correlate to a significant increase in employment.

To the contrary, unemployment remains high.  According to the United States Department of Labor – Bureau of Labor Statistics, the national unemployment rate increased from 9.2% in second quarter 2009 to 9.6% in third quarter 2009.  The same period saw a 2.8% increase in GDP.  These two sets of data pose an intriguing question:  “If GDP increased, why has employment decreased?”  The answer: artificial stimulus.  During periods of “sunshine in the winter,” trees do not open up and bloom to capture the sunshine as this action would damage the tree for the rest of winter (the short term gain would seriously damage the tree in the long term).  The tax credits offered by the government are not creating jobs; instead, they are simply preventing necessary industry-related layoffs/restructuring, thereby stalling the rate of unemployment in the short term and, ultimately, slowing our crawl to an economic recovery.

Continued high rates of unemployment directly impact the Puget Sound Apartment market.  Reduced wages and lay-offs force families to cut expenses where they are able.  A family’s largest expense is on housing, and “downsizing” this expense has the greatest impact on a family’s “bottom line” (unemployment rises, families downsize and move to more affordable housing options).   Properties collecting higher rent are unable to compete to attract tenants and fill vacancies without their own stimulus:  months of free rent, reduced rents and added incentives, to name a few.  Increased vacancies and concessions and lower rents decrease property owners’ net operating income (NOI).  As the overall performance of their asset declines, their balance sheet weakens, creating a difficult refinance task if the investment was bought with short term money.

With increased downward pressure on property performance, lenders are unwilling to deviate from extremely conservative underwriting, thus preventing loans and transactions from taking place.  Business owners, property owners, government, and individuals all depend on lending from the capital markets.  Businesses need loans to expand and hire more employees.  Retailers need customers to buy their goods.  Individuals need buying power (credit) in order to consume.  Apartment owners need tenants to maintain their property’s performance.  Without reasonable access to credit, commerce stalls.  To prosper, or even survive, the economy needs an infusion of liquidity from the capital markets.  If a tree is to grow, the roots need to be strong, absorb as much water as possible, and disburse the water throughout the entire tree.

According to Forbes the most affordable cities to live in are ranked by stable employment rates, low-cost of living, short commute times, low property taxes and stable housing markets.  Most of these markets didn’t go through the same boom in housing sales the rest of the country did a few years ago, meaning they did not have as many subprime loans or foreclosures.  These markets instead have remained stable making home prices and job markets a little better than most of the rest of the country.  Several of these markets weren’t as appealing to buyers during the boom which insulated them from the boom and crash as well.  Buyers and sellers weren’t attracted to these markets then which makes them more attractive now.  

Here is a list of the top five most affordable metros in the United States:

1. Omaha, Nebraska

The most affordable city is Omaha, Nebraska which is also the number one ranking city surviving the recession.  Several Great Plains cities made the list including Wichita, Kansas (Number 6) and Tulsa, Oklahoma (Number 19) as opposed to the coastal metro areas that were hit hard during the housing crisis.  The Great Plains didn’t overbuild and weren’t as affected by the overeager developers rushing new housing projects. 

      2.    Little Rock, Arkansas

 Little Rock has a median home price of roughly $163,000 making it a great market to buy into with low unemployment rates and a good three-year job forecast. 

      3.    Jackson, Mississippi

The Jackson metro area has great commute times and low real estate taxes.  Foreclosures are also low and homes are affordable.

      4.    Des Moines, Iowa

Home-price affordability is above average in Des Moines and the unemployment rate is very low (6%).  The three-year home price forecast is also good and the metro area boasts few foreclosures.

      5.    Augusta, Georgia

Another southern city to make the top 5, Augusta boasts very low real estate taxes and the second-lowest average commute time to work.  Job forecast outlook is also good with low foreclosure rates as well.  Nearby resort towns are devastated by home price speculators that ran up home prices, but largely stayed away from other southeastern cities like Augusta, Columbia (Number 12) and Greenville (Number 20).

For a complete list of affordable cities see forbes.com.

Short Sale Specialists Redirect from Main – San Diego Real Estate |San Diego Homes and Property for Sale | San Diego Real Estate Agents – McMillin Realty.

Don’t just give your home to the bank.  Let McMillin Realty’s Short Sale Specialist help you.  McMillin Realty’s experts are qualified to offer insight, direction, and your best course of action.  It is free and confidential.  Call them today for a no-obligation appointment, or follow the link above.

McMillin Realty has been servicing the San Diego Real Estate community for over 40 years with a reputation built on quality, integrity and trust.  Call them today – 1-800-599-8715 ext. 3202.

Housing Market Snapshot from Yahoo Real Estate

Athens, GA Real Estate Market Snapshot

updated Monday, November 23, 2009

Winder, GA Real Estate Market Snapshot

updated Monday, November 23, 2009

Jefferson, GA Real Estate Market Snapshot

updated Monday, November 23, 2009

www.AthensGAHomesForSale.com

$201,000 To $250,000 Showing Trends For October

The Number Of Showings In October 2004 Was 68 At A Weekly Average Of 15.4 For A Per Listing Average Of 3.6.

52 Showings Were Recorded In October 2005 To Produce A Weekly Average Of 11.7 Showings And 4.0 Visits For Each Listing.

Tenth Month Of 2006 Gave Us A HUGE 390.4% More Showings Compared To The Previous Year For A Figure Of 255. This Worked Out To Be An Average Of 57.6 Per Week And 4.1 Per Listing.

The Number Of Showings For October 2007 Stood At 238. This Gave A weekly Average Of 53.7 With Each Listing Having 2.9 Showings.

178 Showings In October Of 2008 Giving A Weekly Average Of 40.2 And Each Listing Was Shown 2.0 Times.

We Had A Total Of 350 Showings For This Price Range In October 2009, For An INCREASE Of 96.6% Relative To Same Period Of Previous Year. This Resulting In A Weekly Average Of 79.0 And Each Listing Being Visited 3.4 Times.

Looking for a good simple explanation on the homebuyers tax credits?  Check out this video from Keller Williams.  http://www.youtube.com/watch?v=IMzTpn3FvA8

For this month’s statistics, I analyzed the Santa Ynez Valley real estate market by price range.

Following the theme of last month’s blog, the low-end and lower-mid range of the market is very strong and considered a strong seller’s market*. The inventory is low and based on the number of properties entering into escrow we have from 1-3 months of inventory.

From the upper-middle range to the high-end of the market ($800,000+) it is considered to be a strong buyer’s market* with 13+ months of inventory, based on the current trend of property entering escrow compared to active listings.

Click here to view the year to date statistics (January 1st through October 31st) which support the above.

That being said, a property in any price range that is priced well will sell quickly, as there is quite a bit of pent-up demand. As a matter of fact in Santa Barbara multiple offers are occurring quite regularly. The Santa Ynez market closely follows the Santa Barbara market, so it is only a matter of time. In addition, the low end is the first to be affected by economic downturns and it is the first to recover. The recovery of the low-end will have a trickle-up affect to the higher-end over time.

There is quite a bit of positive economic news, but the issue of high unemployment tends to overshadow much of this. The following is a link for an informative and positive press release from the Federal Reserve: click here

With prices and interest rates at an all-time low and a good selection of inventory, especially in the mid to upper range, it is a “perfect storm” for buying.

Please feel free to contact me with any questions or if you would like any additional information.

I spend most of my time thinking about what people my own age are looking for in a first home. In talking to my parents and friend’s parents, I’ve been feeling a series of stark differences between the process those my age work through and the process they went through so long ago.

That difference is reflected in Terrence Belford’s piece for The Globe and Mail, where he says:

The cross-Canada survey says young people prefer city living (64 per cent versus 50 per cent of that 55 plus age group, when they were buying their first home) and that their first purchase was a single family house not a condo or row house (65 per cent). Granted 85 per cent of those in that 55 and over age group said their first home was a detached house.

This might surprise you for a few reasons. One being that the price in housing has obviously changed so dramatically since our parent’s bought their first home so you would assume today’s youth would choose to buy smaller, more affordable condos in the city.

But this is assuming that finances have played a key role in younger people’s purchasing habits when the fact is that, in my experience, they are now preferring to buy a lifestyle, not just an affordable alternative to living with their parents. A lot of young people are also choosing to buy older homes in the city and renovating them to suit their needs. Of course, young buyers are concerned with resale value and their budget largely determines where exactly they can live, but the above shows that younger people are most concerned with buying into a neighbourhood they fit into. The youth of today are more active, more social, more emotionally driven, more practical, therefore where they choose to live is very important to them.

As with every city, every area in Toronto has a different lifestyle and vibe, which is why I enjoy living here so much. There is something for everyone no matter what your price range may be.

Seattle fell seven spots in the Urban Land Institute’s annual rankings of the top commercial real estate markets in the U.S.  While still in the top 10 markets nationwide for 2010, Seattle was dethroned from its top ranking by Washington, D.C.  Here are the key points from ULI’s “Emerging Trends in Real Estate:”

The bad:

• The only market that fell further in the rankings was Tucson, AZ
• Market fundamentals deteriorated rapidly and unexpectedly from last year
• Retail and office properties will be the hardest hit in 2010

The good:

• Seattle remains a top-10 market due to the region’s development barriers and connection to global commerce
• Seattle’s “buy” rating for apartments is the fourth highest
• When the economy rebounds, Seattle will recover faster than most markets

The drop is not unanticipated, as Seattle’s market generally lags the rest of the country by 12 months.  The good news for apartment investors is that the majority of the downturn is attributed to office and retail properties.  Although the apartment rental market has seen its share of vacancy growth, property values are slowly returning to their historical trendline.  While the market recorrects, it is a great time to buy and/or sell and reset your basis prior to the next bull market.  ULI clearly recognizes this opportunity, as evidenced by the high buy rating for Seattle apartments.

The spring and summer months are considered peak season for real estate while the fall and winter are thought of as the off-season.  This doesn’t mean you can’t sell your home in the colder months, you just may have to work a little harder.  There are some advantages to selling your home or property in non-peak season as well.  You will have less competition and have the knowledge of what the market did during the prime season and can therefore adjust your price accordingly.

As for showing your home to a potential buyer, many of the same rules apply.  You should make sure to pack up all personal belongings, empty drawers and stage closets to protect your privacy.  You also need to clean thoroughly: dust furniture, ceiling fan blades and light fixtures, clean cobwebs, wash windows, polish chrome mirrors and faucets, bleach grout, wash and wax floors, vacuum daily in one direction, re-caulk tubs, showers and sinks if necessary, clean out the refrigerator and empty trash and recycling.  Be sure to provide specific information by printing up cards and attaching them to items potential buyers should know more about.  For example if you have an antique chandelier, attach a card with its age and details or if you have removed a washer and dryer from the laundry room attach a card to the wall describing what the room is used for.  These cards can give a potential buyer more information in a short time since you have so little time to make an impression.

There are also certain things you as a seller can do differently in the colder months to attract potential buyers.  One of the most important things you can do is to clear a path to your house.  If you live in a snowy area be sure to shovel the snow, scrape the ice and lay down some sand.  If a buyer cannot get to your front door they will not be interested!  Also consider placing a rubber mat by your door if you live in a wet climate and a container for umbrellas.  The best way to make your house inviting during the shorter daylight hours is light.  Open all blinds, drapes and shutters to encourage as much natural light as possible and turn on every light in the house.  Don’t forget appliance and closet lights!  If you are no longer living in the home use electric timers on indoor lights and motion sensors on outdoor ones.  For rooms with few windows you can brighten them by placing spotlights behind furniture on the floor.

Heat is another way to make your potential buyer want to linger on a cold day.  Be sure to make your home comfortable by setting the thermostat to a warm temperature.  If you have a gas fireplace turn it on!  If you have a wood burning fireplace and are home it can make for a nice homely touch, but be sure to open the damper, put up a grate and attend the fire.  Soft music is another nice touch.  Jazz and classical are soothing, however be sure to load a CD player and not utilize a commercial radio station.  You want the music to be continuous.

As a seller, you also want to create a mood.  Place vases around the house filled with winter flowers and set up your fine china in the dining room.  Display photographs of lush green lawns and summer flower gardens.  You can turn your bathroom into a spa by hanging plush robes, placing groups of lotions and soaps on the counter and rolling up wash cloths tied with ribbon and placed in a basket.  Go easy on scents as many buyers are allergic to candles and air fresheners.  The number one pleasing scent to potential buyers is that of chocolate chip cookies.  If you want to create that scent be sure to provide some for the buyer to munch on!  You may also consider serving winter foods that encourage the potential buyer to linger as well.  These foods include hot soups like squash, potato or tortilla or stew or chilli.  You can also serve hot cocoa and apple cider.

While attempting to sell your home or property in the winter and fall months can seem like a daunting task , if you take a little extra time to create a warm and inviting home you just may have better luck with potential buyers!  Consider adding holiday touches during the holidays as this can tug at the heartstrings of those looking to buy your home and hopefully will make your holiday a little brighter as well.

Home sales bounced back strongly in September with the help of the first-time buyer’s tax credit driving much of the activity.  This marks five gains in the past six months, making sales activity its highest in over two years, according to an article released on Realtor.org.   

Existing home sales include single-family homes, condominiums, townhomes and co-ops.  Each one jumped 9.4% to a seasonally adjusted annual rate of 5.57 million units in the month of September from 5.10 million in August.  

Since the tax credit has recently been extended for first-time home buyers and there has been an addition to the tax credit for repeat buyers, many are feeling hopeful to see even more strong home sales activity because it’s what’s needed for a few additional quarters to help us reach a point of a self-sustaining recovery.

Since September, housing inventory has fallen 7.5% to 3.63 million existing homes for sale.  Now, unsold inventory totals are 15.0% below a year ago.  The current housing supply is the lowest it has been in over two years.  If this could continue, home prices could return to normal by next year.

In the Northeast, existing home sales were 11.8% higher than September 2008.  The Northeast’s median home price was $234.700, which is down 7.0% from one year ago.

In the Midwest, existing home sales jumped up 9.6% in September, making them 7.8% higher than they were that same month one year earlier.  The median home price in the Midwest was $147,600 in September, which was down by 1.0% from one year ago.

The South’s existing home sales rose 9.0% in September, which is 10.0% higher than sales of September 2008.  The South’s median home price in September was $153,500, which is down 7.6% from one year ago.

The West saw a surge of 13.0% in their existing home sales in September, which was up 5.7% from September 2008.  The West’s median home price was $219,000 in September, which was below what they were one year ago.

Discover the Difference…Realtors® Tom & Bev Herring

Search Home for Sale in Tulsa, Oklahoma

A friend sent me this graph yesterday. It tracks the real estate sales activity in Pagosa Springs compared against the S&P index. It is not rocket science but it gives the indication that market activity is directly tied to stock market confidence here in Pagosa Springs. This makes even more since considering we are primarily a second home driven market. I thought it looked interesting when you look at it using the graph.

Pagosa Springs Real Estate market compared with the S&P 500

As you can see from this chart Chula Vista real estate is on the move. Inventory is low and prices are on the rise! If you are on the fence about selling your home, NOW is the time!

Real Estate Trends for 91913!

The deadline for the first-time home buyer tax credit for 2009 is fast approaching.  Many people are wondering how to take advantage of this credit and who it applies to.  Here are some facts you should know.

• The credit applies to first-time home buyers only
• This includes people who have not owned a principal residence in at least 3 years
• The credit is for principle residences and the property must be used as such for 3 years after purchase
• Your spouse also must be a first-time buyer if you file taxes jointly
• The credit is good for purchases between January 1, 2009 and December 1, 2009
• The purchase date is considered the day the closing occurs and title is transferred
• The credit is equal to 10% of the purchase price up to $8,000 depending on your income
• The income limit for a single person is $75,000 and for married people it is $150,000
• If you have a Modified Adjusted Gross Income (MAGI) of more than $95,000 single or $170,000 married you do not qualify
• If your MAGI is below this and above the income limit you may still qualify and have to use the phaseout range of $20,000 (subtract your overage, divide the phaseout, subtract from 1.0 and multiply by $8,000 to find your credit amount)
• Your Adjusted Gross Income or AGI is your total income for a year minus certain deductions or adjustments
• Your AGI is the last number on page one of your 1040 or 1040A or the first number on page 2
• Your AGI includes all forms of income including salaries, wages, dividends, interest and capital gains
• For more about MAGI and AGI see IRS form 5405
• To claim your credit on your federal income tax return use IRS form 5405 or claim on line 67 of your 2009 1040 form
• No pre-approval is necessary for the tax credit
• The credit is good for ANY type of principal residence
• You cannot purchase the residence from your ancestors or lineal descendants or spouse
• The credit is not good for intended purchases, it must be on completed purchases only
• You can construct a residence on a previously owned lot, you just must occupy the residence in the timeline
• The credit is considered refundable meaning it can still be claimed if you have little or no federal income to offset
• If you bought a house in early 2009 and already applied for the 2008 credit you can still apply for the 2009 credit by filing an amended 2008 return with a 1040X form
• If you buy a residence under a Mortgage Revenue Bond (MRB) program you are still eligible but not if you used the MRB program in 2008
• You cannot claim the credit if you live in the District of Columbia and file for the Washington D.C. credit
• If you are a nonresident alien you may still qualify (see IRS publication 519 for the definition of nonresident alien)
• You can file to apply the credit to your 2008 return or whichever year (2008 or 2009) yields the larger credit amount
• If using a FHA insured mortgage you can apply the credit toward your closing costs and down payment instead of waiting to file your federal tax return
• The tax credit is different from a deduction in that the credit is dollar for dollar and a reduction of what is owed

This first-time home buyer tax credit is different from the Congress credit from July of 2008 in that is does NOT have to be repaid.  The July 2008 credit was more of an interest-free loan in that is had to be paid back.  There is some talk on the Hill that the first-time home owner tax credit will be extended for 6 to 12 months due to its success.  There is even talk that it will be increased to $15,000 and will include previous homeowners as well.  At this point there are a lot of pressing issues in Congress so this is all speculation.  If you don’t want to miss out on the tax credit and are eligible now you should take it.