Tuesday, December 22, 2009
Happy Holidays
As this challenging economic year comes to a close, I'd like to take this opportunity to wish all H. Pearce agents, staff, clients, and blog readers a very healthy and happy holiday season, with best wishes for a prosperous New Year. We value your business, and commit ourselves to providing you with the best in professional real estate services. Please call us with any and all of your real estate needs in 2010!
Tuesday, December 15, 2009
Open Houses
Even though we are not in the traditional season for open houses, we've been surprised at how many people have been coming to the ones that have been held lately. We think it's a result of the tax credit, and the interest is stronger at the lower end of the price scale, but we're happy for the activity wherever it falls.
The moral of this story is that this may not be the typical holiday season, and that, if you are a seller, you may want to try harder to sell your home over the holidays. Don't make the assumption that the market will be dead until spring. Our November results were 80% ahead of our November results last year--we are clearly in the early stages of a recovery. While prices will lag for a long time after unit sales rise, there are clearly buyers out there.
The moral of this story is that this may not be the typical holiday season, and that, if you are a seller, you may want to try harder to sell your home over the holidays. Don't make the assumption that the market will be dead until spring. Our November results were 80% ahead of our November results last year--we are clearly in the early stages of a recovery. While prices will lag for a long time after unit sales rise, there are clearly buyers out there.
Wednesday, December 9, 2009
Are You Losing Value?
Recent reports indicate that residential real estate values in our region are declining at around 10-12% per year. That means that a $400,000 home is worth $4000 less every month. Therein lies the real danger of overpricing.
Since we know from experience that the first two weeks of a new listing are the most important from a marketing point of view (since many buyers--and agents--only check for new listings when they search), it's important to begin that period at the correct price. "Testing the market" at a higher amount for a "little while" can lead to months of delay in selling the property, since it doesn't appear as new to those looking to buy, even when it eventually reaches the best price point. Once you factor in the economics of a market that's declining, you can see the true downside of waiting longer for a house to sell. It isn't just the carrying costs, or putting one's life on hold, it's dollars and cents--1% per month, as a matter of fact. And that doesn't even take into account the number of sellers who turn down the first offer (almost always the most motivated offer, and the highest), because they somehow forget that they are "testing the market", and start to think of the higher price as the dollar amount they expect to receive. If we had a dollar for every time a seller tells us later that they regret not taking the first offer, we might not even be taking listings that are too high!
Since we know from experience that the first two weeks of a new listing are the most important from a marketing point of view (since many buyers--and agents--only check for new listings when they search), it's important to begin that period at the correct price. "Testing the market" at a higher amount for a "little while" can lead to months of delay in selling the property, since it doesn't appear as new to those looking to buy, even when it eventually reaches the best price point. Once you factor in the economics of a market that's declining, you can see the true downside of waiting longer for a house to sell. It isn't just the carrying costs, or putting one's life on hold, it's dollars and cents--1% per month, as a matter of fact. And that doesn't even take into account the number of sellers who turn down the first offer (almost always the most motivated offer, and the highest), because they somehow forget that they are "testing the market", and start to think of the higher price as the dollar amount they expect to receive. If we had a dollar for every time a seller tells us later that they regret not taking the first offer, we might not even be taking listings that are too high!
Tuesday, December 1, 2009
Last Call
The Wall Street Journal had an article about buying a house for your child for Christmas. I guess it's appropriate that such an article would be in the WSJ, but it's an interesting idea and deserves some thought!
However, for the average person, it's time to think about buying a property as a holiday gift for yourself. If you hurry, and really move on the mortgage and the inspections, you might even get in for the New Year's celebration. We bought our current house that way. We signed the contract around Thanksgiving, and moved in the weekend before New Year's Day. We even thought of the purchase as a present to ourselves, since, at the time, it was our second home. Many people now do that--buying a vacation home now, with the idea that you might retire to it, is increasingly common with baby boomers. After all, how many socks and sweaters do you need? Putting all the gift money together, and doing something big with it, is likely to be the present that you remember--and enjoy--longest of all.
However, for the average person, it's time to think about buying a property as a holiday gift for yourself. If you hurry, and really move on the mortgage and the inspections, you might even get in for the New Year's celebration. We bought our current house that way. We signed the contract around Thanksgiving, and moved in the weekend before New Year's Day. We even thought of the purchase as a present to ourselves, since, at the time, it was our second home. Many people now do that--buying a vacation home now, with the idea that you might retire to it, is increasingly common with baby boomers. After all, how many socks and sweaters do you need? Putting all the gift money together, and doing something big with it, is likely to be the present that you remember--and enjoy--longest of all.
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