Wednesday, October 21, 2009
The vacant land numbers are so dismal I'm not sure how to put percentages to them as far as values. Very little, and I do mean little, is moving for lots or acreage.
It appears that this trend will continue until 1) the foreclosures begin to dry up, 2) employment goes up and 3) the value of the homes being sold begins to equal the cost to replace them. And, obviously, all three of these conditions are intertwined with each other.
Bottom line: this is a wonderful time to buy.
Monday, September 28, 2009
September 29, 2009
As the news continues to get better for the economy, it still doesn’t seem to help those that are still taking pay cuts, getting laid off or forced into jobs that pay much less than a previous job. It is tough out there!!
I guess the good news is that homebuyers, or should I say property buyers, have never had such a choice of properties at such “affordable” prices. The “affordable index” is telling us that because of interest rates, the low prices, tax breaks and federal and state backed financing, now is the time to purchase a home. Especially if you qualify as a first time homebuyer.
Interest rates for 30 year fixed are currently around 5.04% which is a full 1% less than a year ago. How does this affect a payment? On a $200,000 loan, the payment would be about $125/mo less than a year ago. This gives a buyer about $25,000 more buying power for the same payment.
Another phenomenon that seems to be evolving is the increasing number of short sales (you owe more than it is worth). While this situation has been with us for a while, it has taken a back seat to the foreclosure/REO sales that have dominated our market for the past few months. We will have the foreclosure problem for a while yet and the short sale will be coming up more often. Many Realtors have tried to avoid the short sale properties as the process is long and frustrating as buyers (and sellers) await word from all the entities that have an interest in the note as to whether they will accept the offer. It is hoped that new federal pressure may help speed up the process and we, as Realtors, with new education and experience, can help the homeowner make wise decisions in this respect.
A quick stat:
(source: Bubble Meter.com)
Tuesday, August 25, 2009
- The monthly year vs. year comparisons of median price for the Phoenix area have actually risen for 4 consecutive months. We think this is a prelude to the Verde Valley and Sedona activity.
- According to a Zillow survey, American homeowners are more optimistic about the near future of the economy (81% believe their homes will not decrease in the next 6 months), which is much higher than 6 months ago.
- The same survey indicated that a much higher percentage of homeowners (60%) now understand while the reality is something over 80% for properties that decreased in value over the last 12 months.
- The number of home sales (single family site built) in the Sedona-Verde Valley MLS is up 25% for the first 6 months of '09 vs. the first 6 months of '08. A caution: the values are still down.
- In addition, it appears that asset managers (the contact for agents working on foreclosed properties) have had less flexibility on their price points over the last 3 weeks than they have had over the prior year. Interpretation: they are negotiating harder because they have been instructed by their clients that the market has stopped the freefall.
Thursday, July 30, 2009
Our associates are constantly assisting folks in determing the value of their home. Yes, the market has fallen. No, it never happened here before in anyone's memory. Yes, it will go back up. No, it won't be quick. And yes, it feels like the bottom is near. So how much have the values dropped in the Verde Valley? Every stat you pull will send you a different direction but the drop of value from the high in 2006 statistically is about 38%. And while the number of home sales have slowly, ever so slowly, been rising, the average value has not. Some areas of the Verde Valley vary somewhat from this 38%, but this average applies in many areas. The biggest influence on the decreased values and the increased sales is definitely the foreclosed homes being sold by the lender's asset managers. Foreclosures represent over 60% of the home sale market and the number could still rise. What does this mean to the average buyer or seller? Basically, you can buy really cheap but you have to sell cheap, too. Interest rates are in a historically low range, which is great. But if you purchased a home in 2006 for $300,000, you may have to take a loss of over $100,000 to sell. Some homes that sold for over $200,000 now are closer to $100,000-$115,000. Yes its brutal. But the opportunities are more plentiful than ever before. Check out the tax benefits, the low interest rates and the government assisted loan progams (no, the cash-for-clunkers does not apply in the real estate arena). All for now.