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Buying this Spring? Be Prepared for Bidding Wars

Buying this Spring? Be Prepared for Bidding Wars | Simplifying The Market

Traditionally, spring is the busiest season for real estate. Buyers come out in force and homeowners list their houses for sale hoping to capitalize on buyer activity. This year will be no different!

Buyers have already been out in force looking for their dream homes and more are on their way, but the challenge is that the inventory of homes for sale has not kept up with demand, which has lead to A LOT of competition for the homes that are available.

A recent Bloomberg article touched on the current market conditions:

“It’s the 2017 U.S. spring home-selling season, and listings are scarcer than they’ve ever been. Bidding wars common in perennially hot markets like the San Francisco Bay area, Denver and Boston are now also prevalent in the once slow-and-steady heartland, sending prices higher and sparking desperation among buyers across the country.”

Sam Khater, Deputy Chief Economist at CoreLogic went on to explain why buyers are flocking to the market in big numbers:

“In today’s market, many buyers think the trough in [interest] rates is over. If you don’t get in now, it’s just going to be worse later. Rates will be higher, prices will be higher, and maybe inventory selection will be lower.”

In some markets, “thirty-five percent of properties are selling within the first week or two of hitting the market.” Homes are selling at a rapid clip in places like:

  • Denver, CO
  • Seattle, WA
  • Oakland, CA
  • Grand Rapids, MI
  • Boise, ID
  • Madison, WI
  • Omaha, NE

Bottom Line

Let’s get together to discuss your exact market conditions and help you create a strategy to secure your new home in this competitive atmosphere!

Source: Keeping Current Matters

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15,014 Homes Sold Yesterday… Did Yours?

15,014 Homes Sold Yesterday… Did Yours? | Simplifying The Market

There are some homeowners that have been waiting for months to get a price they hoped for when they originally listed their house for sale. The only thing they might want to consider is… If it hasn’t sold yet, maybe it’s not priced properly.

After all, 15,014 houses sold yesterday, 15,014 will sell today and 15,014 will sell tomorrow.

15,014!

That is the average number of homes that sell each and every day in this country, according to the National Association of Realtors’ (NAR)  latest Existing Home Sales Report. NAR reported that sales are at an annual rate of 5.48 million. Divide that number by 365 (days in a year) and we can see that, on average, over 15,014 homes sell every day.

The report from NAR also revealed that there is currently only a 3.8-month supply of inventory available for sale, (6-months inventory is considered ‘historically normal’).

This means that there are not enough homes available for sale to satisfy the buyers who are out in the market now in record numbers.

Bottom Line

We realize that you want to get the fair market value for your home. However, if it hasn’t sold in today’s active real estate market, perhaps you should reconsider your current asking price.

Source: Keeping Current Matters

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Home Prices Up 6.15% Across the Country! [INFOGRAPHIC]

Home Prices Up 6.15% Across the Country! [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • The Federal Housing Finance Agency (FHFA) recently released their latest Quarterly Home Price Index report.
  • In the report, home prices are compared both regionally and by state.
  • Based on the latest numbers, if you plan on relocating to another state, waiting to move may end up costing you more!
  • Alaska, Delaware, West Virginia & Wyoming were the only one states where home prices are lower than they were last year.

Source: Keeping Current Matters

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Consumer Confidence in Economy & Housing is Soaring

Consumer Confidence in Economy & Housing is Soaring | Simplifying The Market

The success of the housing market is strongly tied to the consumer’s confidence in the overall economy. For that reason, we believe 2017 will be a great year for real estate. Here is just a touch of the news coverage on the subject.

HousingWire:

“Consumers’ faith in the housing market is stronger than it’s ever been before, according to a newly released survey from Fannie Mae.”

Bloomberg:

“Americans’ confidence continued to mount last week as the Bloomberg Consumer Comfort Index reached the highest point in a decade on more-upbeat assessments about the economy and buying climate.”

Yahoo Finance:

“Confidence continues to rise among America’s consumers…the latest consumer sentiment numbers from the University of Michigan showed that in March confidence rose again.”

MarketWatch:

“U.S. consumers are the most confident in the U.S. economy in 15 years, buoyed by the strongest job market since before the Great Recession. The survey of consumer confidence rose…according to the Conference Board, the private company that publishes the index. That’s the highest level since July 2001.”

Ivy Zelman, in her recent Z Report, probably best capsulized the reports:

“The results were incredibly strong and…offer one of the most positive consumer takes on housing since the recovery started.”

Source: Keeping Current Matters

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How Low Supply & High Demand Impacts the Real Estate Market [INFOGRAPHIC]

How Low Supply & High Demand Impacts the Real Estate Market [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • The concept of Supply & Demand is a simple one. The best time to sell something is when the supply of that item is low & the demand for that item is high!
  • Anything under a 6-month supply is a Seller’s Market!
  • There has not been a 6-months inventory supply since August 2012!
  • Buyer Demand continues to outpace Seller Supply!

Source: Keeping Current Matters

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The Foreclosure Crisis: 10 Years Later

The Foreclosure Crisis: 10 Years Later | Simplifying The Market

CoreLogic recently released a report entitled, United States Residential Foreclosure Crisis: 10 Years Later, in which they examined the years leading up to the crisis all the way through to present day.

With a peak in 2010 when nearly 1.2 million homes were foreclosed on, over 7.7 million families lost their homes throughout the entire foreclosure crisis.

Dr. Frank Nothaft, Chief Economist for CoreLogic, had this to say,

“The country experienced a wild ride in the mortgage market between 2008 and 2012, with the foreclosure peak occurring in 2010. As we look back over 10 years of the foreclosure crisis, we cannot ignore the connection between jobs and homeownership. A healthy economy is driven by jobs coupled with consumer confidence that usually leads to homeownership.”

Since the peak, foreclosures have been steadily on the decline by nearly 100,000 per year all the way through the end of 2016, as seen in the chart below.

The Foreclosure Crisis: 10 Years Later | Simplifying The Market

If this trend continues, the country will be back to 2005 levels by the end of 2017.

Bottom Line

As the economy continues to improve, and employment numbers increase, the number of completed foreclosures should continue to decrease.

Source: Keeping Current Matters

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It's a Seller's Market! Should I Downsize Now?

It's a Seller's Market! Should I Downsize Now? | Simplifying The Market

A study by Edelman Berland reveals that 33% of homeowners who are contemplating selling their houses in the near future are planning to scale down. Let’s look at a few reasons why this might make sense for many homeowners, as the majority of the country is currently experiencing a seller’s market.

In a blog, Dave Ramsey, the financial guru, highlighted the advantages of selling your current house and downsizing into a smaller home that better serves your current needs. Ramsey explains three potential financial advantages to downsizing:

  1. A smaller home means less space, but it also means less time, stress and money spent on upkeep.
  2. Let’s assume you save $500 a month on your mortgage payment. In 30 years, you could have an additional $1–1.6 million in the bank to get you through your golden years.
  3. Use the proceeds from selling your current home to pay cash for a smaller one. Just imagine what you could do with no mortgage holding you down! If you can’t pay cash, aim for a 15-year fixed rate mortgage and put at least 10–20% down on your new home. Apply the $500 you saved from downsizing to your new monthly payment. At 3% interest, you could pay off a $200,000 mortgage in less than 10.5 years, saving almost $16,000 in the process.

Realtor.com also addressed downsizing in an article. They suggest that you ask yourself some questions before deciding if downsizing is right for you and your family. Here are two of their questions followed by their answers (in italics) and some additional information that could help.

Q: What kind of lifestyle do I want after I downsize?

A: “For some folks, it’s a matter of living a simpler life focused on family. Some might want to cross off travel destinations on their bucket lists. Some might want a low-maintenance community with high-end upgrades and social events. Decide what you want to achieve from your move first, and you’ll be able to better narrow down your housing options.”

Comments: Many homeowners are taking the profits from the sales of their current homes and splitting it in order to put down payments on smaller homes in their current locations, as well as on vacation/retirement homes where they plan to live when they retire.

This allows them to lock in the home price and mortgage interest rate at today’s values which makes sense financially as both home prices and interest rates are projected to rise.

Q: Have I built up enough equity in my current home to make a profit?

A: “For most homeowners, the answer is yes. This is if they’ve held on to their properties long enough to have positive equity that will be sizable enough to put a large down payment on their next home.”

Comments: A study by Fannie Mae revealed that only 37% of Americans believe that they have significant equity (> 20%) in their current home. In actuality, CoreLogic’s latest Equity Report revealed that 78.9% have greater than 20% equity. That equity could enable you to build the life you’ve always dreamt about.

Bottom Line

If you are debating downsizing your home and want to evaluate the options you currently have, let’s meet up to help guide you through the process.

Source: Keeping Current Matters

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How to Get the Most Money When Selling Your Home

Every homeowner wants to make sure they get the best price when selling their home. But how do you guarantee that you receive maximum value for your house? Here are two keys to ensuring you get the highest price possible.

1. Price it a LITTLE LOW 

This may seem counterintuitive. However, let’s look at this concept for a moment. Many homeowners think that pricing their home a little OVER market value will leave them room for negotiation. In reality, this just dramatically lessens the demand for their house (see chart below).

How to How to Get the Most Money When Selling Your Home | Simplifying The Market

Instead of the seller trying to ‘win’ the negotiation with one buyer, they should price it so that demand for the home is maximized. By doing this, the seller will not be fighting with a buyer over the price, but will instead have multiple buyers fighting with each other over the house.

Realtor.com gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly underpriced, especially in areas with low inventory.”

2. Use a Real Estate Professional

This, too, may seem counterintuitive, as the seller likely believes that he or she will net more money if they don’t have to pay a real estate commission. With that being said, studies have shown that homes typically sell for more money when handled by a real estate professional.

Research posted by the National Association of Realtors revealed that:

“The median selling price for all FSBO homes was $185,000 last year. When the buyer knew the seller in FSBO sales, the number sinks to the median selling price of $163,800. However, homes that were sold with the assistance of an agent had a median selling price of $245,000 – nearly $60,000 more for the typical home sale.”

Bottom Line

Price your house at or slightly below the current market value and hire a professional. This will guarantee that you maximize the price you get for your house.

Source: Keeping Current Matters

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Housing Market Expected to “Spring Forward”

Housing Market Expected to “Spring Forward” | Simplifying The Market

Just like our clocks this weekend in the majority of the country, the housing market will soon “spring forward!” Similar to tension in a spring, the lack of inventory available for sale in the market right now is what is holding back the market.

Many potential sellers believe that waiting until Spring is in their best interest, and traditionally they would have been right.

Buyer demand has seasonality to it, which usually falls off in the winter months, especially in areas of the country impacted by arctic temperatures and conditions.

That hasn’t happened this year.

Demand for housing has remained strong as mortgage rates have remained near historic lows.

The National Association of Realtors (NAR) recently reported that the top 10 dates sellers listed their homes in 2016 all fell in April, May or June.

Those who act quickly and list now could benefit greatly from additional exposure to buyers prior to a flood of more competition coming to market in the next few months.

Bottom Line

If you are planning on selling your home in 2017, let’s get together to evaluate the opportunities in our market.

Source: Keeping Current Matters

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Thinking of Selling? Do it TODAY!!

Thinking of Selling? Do it TODAY!! | Simplifying The Market

That headline might be a little aggressive. However, as the data on the 2017 housing market begins to roll in, we can definitely say one thing: If you are considering selling, IT IS TIME TO LIST YOUR HOME!

The February numbers are not in yet, but the January numbers were sensational. Lawrence Yun, Chief Economist for the National Association of Realtors, said:

“Much of the country saw robust sales activity last month as strong hiring and improved consumer confidence at the end of last year appear to have sparked considerable interest in buying a home. Market challenges remain, but the housing market is off to a prosperous start as homebuyers staved off inventory levels that are far from adequate…”

And CNBC says consumer confidence in the economy is fueling the market:

“U.S. home resales surged to a 10-year high in January as buyers shrugged off higher prices and mortgage rates, a sign of growing confidence in the economy.”

The only challenge to the market is a severe lack of inventory. A balanced market would have a full six-month supply of homes for sale. Currently, there is less than a four-month supply of inventory. This represents a decrease in supply of 7.1% from the same time last year.

Bottom Line

With demand increasing and supply dropping, this may be the perfect time to get the best price for your home. Let’s get together and discuss the inventory levels in your neighborhood to determine your next steps.

Source: Keeping Current Matters