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Showing posts with label home prices. Show all posts
Showing posts with label home prices. Show all posts
Thursday, October 10, 2013
Monday, September 12, 2011
Lowest Rates in 60 Years!
Remember this time, folks, because you won't see it again in your lifetime. CHFA rates are at 3.625% for a 30-year fixed rate mortgage. Compare that to when I bought my first home--my state-subsidized first-time homebuyers rate in 1982 was 17.75%! Mortgage rates are the lowest they have been in 60 years.
If you add that to the fact that homes are down 5% in price, with vacation homes down 11% in price, this is a great time to buy. Counterintuitively for many people, the period after a hurricane is an excellent time to buy property on the shoreline. Just as with the spring after a bad winter, people often get spooked and decide that it's time to decamp for a condo or assisted living, and they are willing to be reasonable about their price. If you add that to the discount that waterfront property often goes for in the fall, as well as the general rule that the best time to make an offer is between Halloween and Thanksgiving, everyone should be out scouting right now!
Do you really trust the stock market more than the real estate market?
If you add that to the fact that homes are down 5% in price, with vacation homes down 11% in price, this is a great time to buy. Counterintuitively for many people, the period after a hurricane is an excellent time to buy property on the shoreline. Just as with the spring after a bad winter, people often get spooked and decide that it's time to decamp for a condo or assisted living, and they are willing to be reasonable about their price. If you add that to the discount that waterfront property often goes for in the fall, as well as the general rule that the best time to make an offer is between Halloween and Thanksgiving, everyone should be out scouting right now!
Do you really trust the stock market more than the real estate market?
Tuesday, October 26, 2010
It's That Time of Year Again
Every year I write the same thing at this season, because every year it's true: the best time to buy real estate is between Halloween and Thanksgiving. Why is that? Because that's when sellers are most likely to accept an offer that makes a transaction either possible or particularly enticing to the buyer. As the weather gets colder, and thoughts of heating oil, plowing driveways, and holiday hiatuses on open houses and offers creep in, sellers weigh, as they should, the costs of carrying a property through the winter (for that is most likely what they will end up doing, if they don't sell by Thanksgiving) against the reality of an offer that is less than they want to accept. In addition, there's no guarantee that prices will even go up in the spring, and a outside chance that values could decline over the quiet months. As a further inducement, some sellers have tax reasons that make closing before the end of the year important or at least profitable. Although some people say that tax considerations could change with a new Congress, I think most would agree that uncertainty generally doesn't favor waiting when one is talking about the chances of taxes going either up or down. Even the economic news, which has seesawed over the past year, should make one cautious about holding out for better times.
This year, with so much inventory on the market, and so little time before the holiday season, it's especially important to consider pricing properties at levels that are not just correct, but compelling. Stand out from the crowd with a price that entices, and get your property sold while others just sit. And do it before the first flakes of snow hit the ground!
This year, with so much inventory on the market, and so little time before the holiday season, it's especially important to consider pricing properties at levels that are not just correct, but compelling. Stand out from the crowd with a price that entices, and get your property sold while others just sit. And do it before the first flakes of snow hit the ground!
Tuesday, September 22, 2009
Where are the Luxury Buyers?
I thought I should write a little bit more about the information on market inventories that I described last time. As I stated, there is a direct correlation between the price and the amount of months of inventory on the market. So, for properties under $200,000, there is a 1.7 month supply. For each increasing value bracket, that supply goes to between 2 and 3 months, between 3 and 4 months, between 4 and 5 months, and then goes to over a year above $700,000. Only 2.7% of the sales now are above $700,000, and there are more homes on the market in that price range than in either of the two price ranges below that.
This surprises me in some ways. While I know that consumers are cautious, and I realize that the governmental incentives are aimed at a lower price point, one would still think that the combination of low interest rates and a skittish stock market would drive people to spend their savings on real estate. In addition, there are still those who could be downsizing and yet be spending above that amount for a property. Since investing one's assets is so problematic these days, real estate stands out as a tangible asset that is currently selling at bargain prices.
We bought our home at what turned out to be the bottom of the last market cycle, and it has turned out to be our best investment. While you cannot pick the bottom of the cycle without luck, this clearly has to be a time that will turn out to be good, considering the interest rates and prices. Why not take advantage of that, and look back years later with great satisfaction on your best investment?
This surprises me in some ways. While I know that consumers are cautious, and I realize that the governmental incentives are aimed at a lower price point, one would still think that the combination of low interest rates and a skittish stock market would drive people to spend their savings on real estate. In addition, there are still those who could be downsizing and yet be spending above that amount for a property. Since investing one's assets is so problematic these days, real estate stands out as a tangible asset that is currently selling at bargain prices.
We bought our home at what turned out to be the bottom of the last market cycle, and it has turned out to be our best investment. While you cannot pick the bottom of the cycle without luck, this clearly has to be a time that will turn out to be good, considering the interest rates and prices. Why not take advantage of that, and look back years later with great satisfaction on your best investment?
Wednesday, September 16, 2009
Market Inventory
We recently received a market inventory study from Madison, Wisconsin, showing that higher-end properties were not selling and lower ones were. Not a big surprise, but we decided to look at our market. What we found was similar, and striking.
Properties over $700,000 are less than 3% of sales now, there are enough homes in that range on the market to represent more than a year's supply, and the sales have fallen almost in half from last year. At the lower end, under $300,000, there exists only a supply of two and a half months, sales have risen by a third, and they represent 41% of all sales. While we knew that first-time homebuyers were driving the current market, it's still fascinating to see that laid out in statistics.
Overall, in our region, prices have fallen 15% since the same time last year. If you put all these facts together, what it tells you is that you are more likely to sell your home quickly if it's in a lower price range and you price it aggressively. But you knew that already!
Properties over $700,000 are less than 3% of sales now, there are enough homes in that range on the market to represent more than a year's supply, and the sales have fallen almost in half from last year. At the lower end, under $300,000, there exists only a supply of two and a half months, sales have risen by a third, and they represent 41% of all sales. While we knew that first-time homebuyers were driving the current market, it's still fascinating to see that laid out in statistics.
Overall, in our region, prices have fallen 15% since the same time last year. If you put all these facts together, what it tells you is that you are more likely to sell your home quickly if it's in a lower price range and you price it aggressively. But you knew that already!
Monday, April 13, 2009
More on the Market
I just gave a press interview on the results of the first quarter in our area. Those results were dreadful. Very little sold, and what sold did so at lower prices. The activity has picked up since then, although those sales won't show up until the second quarter.
What is interesting to those of us in the business, who believe that we are bumping along the bottom, is to guess when the bump will start trending up. Units always increase before prices, and, while prices may continue to go down for a while longer, units should begin to increase. Once activity improves, pent up demand for new housing may cause houses to flood the market, as homeowners seek to trade up or down. That increase in supply will satisfy the still anemic demand for some time to come.
The lesson here is that there is a window, which has already opened in East Rock and Spring Glen, where those contrarians who seek to sell in the face of awful media reports have gotten or are getting surprising high prices. Not much was on the market, and people who needed to be in place for jobs beginning in the summer or fall, or those who needed to move for one reason or another, were competing for just a few houses. Multiple offers, many over the asking price, were common. That may change as people have more choices.
A word to the wise: He who hesitates is lost. List now.
What is interesting to those of us in the business, who believe that we are bumping along the bottom, is to guess when the bump will start trending up. Units always increase before prices, and, while prices may continue to go down for a while longer, units should begin to increase. Once activity improves, pent up demand for new housing may cause houses to flood the market, as homeowners seek to trade up or down. That increase in supply will satisfy the still anemic demand for some time to come.
The lesson here is that there is a window, which has already opened in East Rock and Spring Glen, where those contrarians who seek to sell in the face of awful media reports have gotten or are getting surprising high prices. Not much was on the market, and people who needed to be in place for jobs beginning in the summer or fall, or those who needed to move for one reason or another, were competing for just a few houses. Multiple offers, many over the asking price, were common. That may change as people have more choices.
A word to the wise: He who hesitates is lost. List now.
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