Thursday, January 13, 2011
Monday, October 25, 2010
The State of the Market
I think people are beginning to hedge their bets. Prices haven’t been this good for a long time. Sellers are serious. The rate for a 30-year conventional fixed-rate mortgage fell to a record low of 4.43 in August according to Freddie Mac. Note that the rate was 5.19 percent in August 2009.
So what is holding back more buyers? The main reason given is a lack of confidence in our national economy. Many believe that the November elections will create a new direction and confidence will grow. If that is so, then buying now will be seen as the smart move.
I am going to be talking about understanding the value of having a comparative market analysis below. Knowing the local market and seeing the trends in our area is what I do best for you. Let me know if you have specific questions and we can meet at your convenience.
JUST ASK
Q: What is a CMA?
A: A Comparative Market Analysis, or CMA, is an in-depth analysis of the home’s worth in today’s market. If you are thinking about selling your home, then we need to determine the fair market value first. There are online sites as well as newspaper listings that will give valuations. But each house is different and most sales are not posted publicly for months. It takes an expert who has walked through the recent homes for sale, knows the streets of the neighborhood, and knows the trends of real estate transactions to best assess which properties to compare to yours in order to create a realistic CMA.
To create a CMA, first I will walk through your home. At this point, I may recommend some improvements that would increase your home’s value. Then I will check all sales, pending sales, expired listings and active listings in our area that relate to your home. Once we have the analysis, together we will determine an asking price.
Depending on the strength of the market when we list your home, you can expect a range of offers. My goal then is to aggressively market your home so that you get the most exposure from qualified buyers. In the end, you and the buyer determine the final selling price.
MY TOWN
Any parent knows the value of good schools for their children. But the value of good schools doesn’t only affect children and their families, it also impacts neighborhoods and the property values of your home. Even if you don’t have school-age children, knowing the ratings of schools in your current home or prospective new homes will affect your pocketbook in the long run.
The Internet offers some free, comprehensive resources to find school ratings. While ratings don’t cover all of the facets of a school’s value, they give a quick data point to know how well children are learning at any given school. Academic Performance Index (API) score, state rank, parent education and more can be found on www.school-ratings.com. Check out www.greatschools.org for comprehensive school data nationwide. Peruse the website to find the top schools in small, medium, or large US cities (click Find a School tab, then Choose the Right School, then Moving with Kids). Or search for a specific city to review the API results.
As an agent, it is my job to know the local schools not just by test results, but through people and real stories. If you would like more information on your local schools, or the schools in a different neighborhood, just call or email me. Either I’ll help or I’ll connect you with someone who can.
FYI
With a large amount of bank-owned properties on the market, it's a great time for homebuyers looking for good deals. But bidding on bank-owned homes also means the homebuyer has to compete with investors bringing cash offers.
Fannie Mae's got a new program for their Real Estate Owned (REO) properties. For homeowners, this is a way to buy properties that have reduced prices BEFORE investors can buy them. After the property hits the market, you've got fifteen days to look at the property.
Qualified homebuyers must be owner-occupants and can receive up to 3.5% of the final sales price, which can be used toward closing cost assistance including a home warranty, if desired and available. Eligible offers must be submitted on or after Sept. 23, 2010, and must close by Dec. 31, 2010. The sale must close within 60 days of the offer being accepted.
Let me know if you are interested in this program. It is being offered through real estate professionals to give their clients the heads-up. Properties available under this program can be viewed on the REO Web site www.HomePath.com.
Friday, July 9, 2010
WHY IT MAKES SENSE TO BUY NOW
Many buyers are “sitting on the fence.” They don’t know whether there will be a “double dip” in the economy. They feel they missed out on the tax credit incentive etc. While these and other issues, like job uncertainty are keeping many away from making the commitment, there are also excellent and unprecedented reasons to buy now.
Sellers too, have been hesitating, concerned that they won’t receive a “reasonable price” for their homes. They seem to want to wait until prices have come back to pre-bubble bursting times. There is a belief (wish, desire) that things will recover and do so pretty soon. Not only that, many aren’t considering the fact that while their home will rise in price, sometime in the future, so too will the property they want to buy, as well as the cost of their mortgage (when rates rise as well.) Consequently, there are excellent reasons for some sellers to market their homes now as well.
As reported by the LA Times below, interest rates are the lowest they have been in the 39 years Fannie Mae has been tracking these rates.
Prices as most are aware, are back where they were 5-7 years ago and have either stabilized or begun to inch up. With the “affordability index” at its highest point in over 10 years, there are more potential buyers available.
It takes a simple math calculation to document to people how much they will save by buying now @ 4.5% then waiting a year or two when interest rates move up to and over 6%. It will make it even more expensive if property values increase a slight 3% over the next few years.
Below the link to the LA Times article is a link to the mortgage calculator I used in my example.
http://www.mortgagecalculator.org/
SAMPLE COMPARISON – BUY NOW @ CURRENT PRICES - BUY LATER (3% appreciation)
Sales Price today $600,000 $618,000
Loan Amount (20% DP) 480,000 494,400
Interest rate (4.5% current) 6.5% projected
Payment (30 year) $2,432.09 $3,124.74
Total interest paid $395,552.22 $630,579.95
Friday, June 25, 2010
Sunday, June 13, 2010
California Association of Realtors Market Update
Leslie Appleton Young, Chief Economist of the California Association of Realotrs discusses the residential real estate market
Thursday, March 4, 2010
DISASTER PREPAREDNESS
While sitting here creating this note, I can look out my window and see where the Hayward Fault is located, just a few hundred feet from my office. It is a stark reminder of how close we are to the location of a "significant event" as seismologists sometimes refer to a major quake.
One of the first things I remember hearing when I came to California in 1970 was that there would be a major earthquake on the Hayward Fault in the next 30 years. I heard the identical warning last year when the '06 quake was having it's 103rd anniversary. So clearly, we don't know when it's going to come, but to ignore the reality of where we live and what's "around the corner" is no more then sticking our head in the sand. I can tell you as a victim of the Oakland Fire, it is not a good idea to be unprepared.
While no expert, I have had exposure to The City of Oakland's CORE Program (Citizens of Oakland Respond to Emergencies). It assists neighborhoods and families by supplying the training and expertise to ensure residents and their families have the best chance of making it through a major earthquake or other disaster. They assist with little things like creating a plan so that families that are apart when the disaster occurs have an agreed upon place to meet and someone out of area to call to let them know their whereabouts.
Their web site is:
http://www.oaklandnet.com/fire/core/index.html
The other very useful source for this kind of information, with practical suggestions for how to minimally prepare without becoming a survivalist, is http://72hours.org
This site was created by the City of San Francisco. It gets its' name from the belief that for the first 72 hours of a major disaster we are likely to be on our own, without emergency services. This site makes recommendations related to making it through that period of time with minimal inconvenience.
I hope I haven't brought you down with this message. I just wanted you and your families to be safe.
