Dropping Into Your Lap
April 4th, 2009 categories: Market Trends, Real Estate News, Relocating
“Doubtless one man’s loss is another man’s gain.”
Walter Scott, 1821
Yesterday’s New York Times featured an article on the influx of first time homebuyer’s who’ve taken advantage of the current real estate market, which is flush with foreclosured homes for sale. Of course, “foreclosure property” normally means a home priced at a bargain.
The article highlighted a few bright spots in the evolving housing market:
1) Many families, who previously rented, are now finding bargain prices coupled with rock bottom interest rates, resulting in increased purchases.
2) The addition of the first time homebuyers tax credit of $8000.00, coupled with bank incentives (like closing cost assistance for buyers) on listed foreclosed homes has encouraged many to purchase a home for the first time.
3) Additionally, many buyers ar taking advantage of current Federal Housing Authority loan requirements which allow for lower credit scores and a down payment of 3.5 percent of the purchase price of the home.
For many of us in the real estate industry, the Times article is anything but surprising. The price depression is something you’d have to be blind to miss. Coupled with low interest rates, and now, prime buying season, those interested in purchasing a home, who may have been on the sidelines waiting for the dust to settle, have decided it’s time to get in the game. Perhaps they’ve heard the old adage; “Never look a gift horse in the mouth.”
If you’re one of those on the sidelines, don’t you think its time to get moving? Believe it or not, the great deals won’t be there forever.
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Homes By The Numbers
March 13th, 2009 categories: Market Trends, Real Estate News, Relocating
Our local newspaper, the Free Lance Star (FLS), provided us with housing figures this week. First, on Wednesday, it reported the median sales price for the Fredericksburg area had fallen to the lowest level since April, 2003. February sales figures indicated the median sales price dropped to $190,000. RealtyTrac provides current tracking data for foreclosure properties nationwide. Below is a snapshot of the latest picture of Virginia foreclosures.
Yesterday, the FLS followed up with news that Spotsylvania was #1 last month. First in Virginia in the rate of foreclosures, by county. Again, the figures were drawn from RealtyTrac. As the article reported, Stafford County wasn’t far behind, finishing fourth in the state’s foreclosure rate.
While many see the foreclosure numbers as bad news, for those in the market to purchase a home, the news couldn’t be more welcome. There are a couple of obvious attractions for buyers:
1) Coupled with low mortgage rates, depressed home prices provide a market ripe for the picking.
2) For first time homebuyers ( to qualify for “first time” status, you only need not to have owned a principal residence for three years before buying a house), you also benefit from the recent stimulus package’s first time homebuyer’s tax credit.
According to the Metropolitan Regional Information Systems sales data, Spotsylvania home sales increased approximately 40 percent from January to February of this year. Some of the increase may be attributed to the move towards the traditional Spring buying season. But, an increase in the number of foreclosed homes, and the lower prices that accompany them, contributed as well.
While many lenders have taken steps to halt foreclosures, according to RealtyTrac, the number of U.S. homes threatened with losing their homes rose 30 percent in February from last year’s levels. So, from all appearances, it doesn’t appear as if our economic Humpty Dumpty will find himself in one piece anytime soon. And, while buyers may not feel home sellers’ pain, they can certainly benefit from it.
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Today’s Housing Numbers, Then There’s the Good News
April 29th, 2008 categories: Market Trends, Real Estate News
In a survey released today by Standard & Poor’s, home prices have posted another record decline. The S&P Case Shiller Home Price Index, which tracks 20 of the nation’s largest housing markets, showed prices falling by 12.7% in the 12 months ending February. According to the Indices, 17 of those 20 markets posted their largest year-over-year declines ever. The good news for those of us from the Washington D.C. metropolitan area is that Las Vegas was the hardest hit with a drop of 22.8 percent. Ours, on the other had, was a decline of 13 percent. If historical home prices are something you’d like to look at, visit the S&P homeprice history which they’ve been tracking for more than 21 years. 
For anyone paying attention to the market, this price drop should not come as a complete surprise. With an increasing amount of foreclosed and short sale properties on the market, downward pressure on home prices are par for the course. According to RealtyTrac, the leading online marketplace for foreclosed properties, March figures show a 60% increase of foreclosure properties compared to last year. While this market information isn’t what sellers want to hear, the good news is, their focus shouldn’t change when marketing their home.
SELLERS
The keys to success at selling a home don’t change with the market. While there are a number of key components to properly market your home, three critical keys are:
- Understanding Your Market
- Remember – Prices and market conditions vary depending on time, location and the condition of your home.
- Have Your Home in SHOW Condition
- Especially in today’s buyer’s market, make sure your home shows like new, if possible. Hiring a staging professional may well be worth the expense. Remember the old saying, “you never get a second chance to make a first impression.” So, make the most of it!
- Price It Right
- While the first two keys are vital, pricing it right may be the most important decision you make. One of difficulties in today’s market, is an appreciation by sellers of current market conditions. That is why it is extremely important to depend upon the pro, your Realtor, for advice on the price. It is their domain – let them do their job, and listen. Any good agent will give you the support data used to support their recommendation. Trust them. Hopefully, their price justification will reinforce why you chose them in the first place to market your home.
For buyers, things don’t get much better….
BUYERS
As mentioned in an earlier blog entry, today’s market is about as good as it gets for the prospective home buyer. Inventories are at record levels, and interest rates are extremely low. Outside of a complete market collapse (in that case, we’ll have bigger worries than the diminishing value of our home), buyers and investors can almost pick and choose their next home.
If you do decide to make a trip to your local county Courthouse for the auctioning of homes, make sure your Realtor has clearly explained what’s involved. While there are great deals to be had at the Courthouse steps, make sure you show up with money in hand. Yes, a Cashier’s check will work. Again, if it’s your first auction, make sure and do your home work.
However, if you’re buying your next home the old fashioned way, give your Realtor a call. For the home buyer, refer to these 10 Critical Steps as you begin your journey. And, remember, in this market, the numbers are your friend.
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It’s Still a Numbers Game
April 14th, 2008 categories: Real Estate News, Relocating
Now that the Masters golf tournament is over for another year, the Spring house hunting season has officially begun.
Each year, about mid-April, the Northern Virginia housing market begins to heat up. For those planning a reassignment or relocation to the area, late April to mid-June is when the buyers come to town in droves. These days, it appears to be the ideal time for that Spring house hunting trip. With temperatures in the 60s & 70s, blue skies & a comforting breeze, the conditions make it less of a chore and more an invition to enjoy the natural experience of the journey. And, today’s local paper, the Free Lance Star made the thought of buying more inticing for many. While the front page headline “HOUSING PRICES IN TWO-YEAR DIVE”, wasn’t telling us anything we didn’t already know, the account made a number of valid points.
John McClain, the deputy director of George Mason University’s Center for Regional Analysis, whose has closely studied housing trends in the Washinton Metro area since the mid 1970s, says the market’s advance until 2004 was a reaction to years of price stagnation and increases in job and wage growth. Additionally, McClain contends, as do many other market experts, that “irrational exuberance”, coupled with:
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Low interest rates
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Lax lending standards
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The expectation of many homebuyers for a substantial return on their investment
resulted in an economic or housing bubble, that was doomed to burst sooner or later.
According to GMU, 10-12 percent of the total listings in Stafford and Spotsylvania counties are short sales or foreclosures. The building boom, coupled with the high rate of foreclosures and short sales have resulted in a home inventory that is extremely high, the perfect storm for home buyers. Will these conditions last long? It may be difficult to predict the future of the home market, or the overall economy. But, one thing is certain, it took years of bad credit, bad loans, and bad decisions to get us into this mess. There’s no reason to think that the journey to clearer skies for the housing market won’t take just as long. For any home buyer, that’s a deal too good to be true!
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