July is Sizzling!

There aren't many holiday times for real estate agents.  People tend to buy real estate when they have time, and that is often when the rest of their lives are slow.  For us, that can mean writing a contract on the hood of a car on Mother's Day, or in a kitchen on Christmas Eve.

Usually, though, we can count on the fact that, once the rush to buy and close in the spring and early summer is over, mostly by June 30th, there will be a break that can last until Labor Day.  Except for vacation-area properties, most homes are not as likely to be sold, or even shown, in the dog days of summer.  Few people choose to list their homes then, either, maybe because they'd rather be at the beach than getting property ready to show.

But not this year!  We're well into the dog days of summer, and we're cranking along at full speed still.  In my opinion, we are still catching up from the time we lost to storms, particularly the Blizzard of 2013 in February.  Closings were slow in March and April, and we're still scrambling to finish what would ordinarily have been the spring market.  And, as anyone who has been outside in the past month knows, it's not spring anymore!

What does this mean for buyers and sellers?  Sellers should reconsider holding off until Labor Day to list, and many people are doing just that.  New listings are surprisingly robust for summer. Buyers should not give in to the impulse to procrastinate.  Mortgage rates have already gone up 15%.  Prices are up in almost every part of the country, and are starting to climb on the lower end of the market here.  Don't make the mistake that so many people do, and spend your summer next year wishing that you'd bought now!

Good News/Bad News

Within the last week, there have been many reports that have indicated that the recovery is far from over.  Unemployment nationally is still at 7.7%;  in Connecticut, it's 8.8%.  Jobs are being added, but at a faster rate in other states.  We added 300 jobs in November, but have only added back 25% of the jobs we lost during the recession; for the country as a whole, that percentage is more than double.

Then, this week, it was announced that New Haven was the number 1 buyers' market in the country, meaning that buyers can get a better deal here than anywhere else, because prices haven't risen.  There are reasons for that, though, that are far from negative.  We had a lower decline than in many other parts of the country, and we haven't seen the amount of foreclosure activity that has taken place in other states.  Therefore, our prices haven't gone down as much, and aren't then being pushed up as much now, because we still have a supply of properties on the market that exceeds what is available elsewhere.

So why is that good news?  Because Pearce had a great year anyway, and it means that the future is bright indeed!  With just a little bit of what is happening in other states, our revenues were up by a third over 2011. Some of that doubtless reflects an increase in market share, but it still bodes well for next year.  As the recovery pace, which is 46th here among the 50 states, increases, we will see further gains, price increases, and lower inventory.  All of that will be terrific, and that's before we factor in that we are finally doing something about job growth in the state, which will make it even better.

The message:  Buy now.  It will cost you more soon.  Give someone you love a property for the holidays!

Some New Statistics

Just before the beginning of the fall selling season, it's a good idea to review some of the facts we know about the current state of real estate.  We know that Guilford, for example, has twice as many homes on the market now as have been sold since the beginning of the year.  By definition, that constitutes a buyer's market.  We know that pricing high is almost never the way to go, because one of our agents did an analysis of a shoreline agent at another company.  This second agent was known for taking listings at high prices, so we looked at what the sales results were, and the answer was striking, but not surprising.  The agent who lists high sold properties at an average of 59% of the listing price, while most other agents in the same area sold their listings at over 90% of the listing price. 

The final statistic comes from my smart friend in Madison, Wisconsin, whom I've mentioned before, because his market seems to be so much like ours.  He studied the phenomenon of "chasing the market down", which I've blogged about previously.  He looked at the selling experience of sellers who priced correctly from the start, and compared their results to those of sellers who just wanted to "test the market" or who priced their properties above what agents thought they should be for other reasons.  The sellers who priced correctly from the start got 12% more for their properties in half the time. 

What else do I need to say?