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The Rilliet Report February 2014

February 13 2014
February 13 2014

THE BUZZ

Reflection is important in real estate.

The years of 2008-2012 marked a downswing and a time of indecision. Buyers were scarce and prices fell. The economy offered no confidence. Mortgage restrictions negatively affected sales. It was a buyer's market.

Then an upswing began in 2012. By spring of 2013, we were in a seller's market. Multiple offers were commonplace. Inventory flew off the market. All-cash buyers had the advantage.

By the last quarter of 2013, we moved from a seller's market to a balance market, with inventory remaining low.

Looking forward, mortgage rates have remained down but are expected to rise. Job growth is stronger and pent-up demand is higher, according to Lawrence Yun of the National Association of Realtors (NAR). New home building is up. House flips are up with investors betting on rising prices.

Spring typically sees a rush of sellers putting their homes on the market. Since competition will be higher then, savvy sellers often list their properties well in advance so their home stands out.

If you have thoughts of selling or buying, let's talk. The time is now.

 

JUST ASK

Q: Are foreclosures a thing of the past?

A: According to the National Association of Realtors, at the depth of the real estate downturn, there were 12-13 million underwater homeowners. That number now has been slashed in half.

Four years ago, there were 4.3 million delinquent properties. One year ago, there were 2.9 million delinquent mortgages. Today there are reported to be 2.3 million mortgages that are 90 days or more delinquent. Yet remember, real estate is local. California, Arizona, Utah and Colorado are a few of the states with low delinquency rates.

The good news is that property owners have witnessed on average $32,000 increase in home equity in the past two years. More inventory is needed to meet the demand of buyers. In the coming months, strong activity should continue to drive up home values. I am watching the trends and would be glad to talk about how to strategize.

 

MY TOWN

Recently I wrote about all-cash buyers. They are coming in with full-cash offers that are significantly higher than asking price. Last year, between late spring and summer, multiple offers was the norm.

We are now seeing the effects of investors shutting first time buyers out of the market. Hedge-funds, private equity investors, and foreign buyers are purchasing lower-priced homes and creating a new single-family rental trade. These homes can be rented by the year but also by the week or month. Websites such as VRBO make it easy for the masses to access these rentals.

First time home buyers represented historically about 40% of the market. As of December 2013, just 27% of sales were to first-time home buyers. That is the lowest percentage since the NAR started tracking in 2008.

 

FYI

Times are changing. Two in every five U.S. homes are opting out of having landlines. According to the Center for Disease Control and Prevention, this number has been rising over the past decade. Roughly 38% of the population, roughly 90 million adults, now exclusively uses wireless.

This doesn't mean they are restricted to only use their cellphones. There are services that require an Internet connection such as Skype, a free video chat online service, and Facetime.

Ditching the landline will allow you to shed a monthly bill. However, remember that having a landline does provide security. Hurricane Sandy disrupted cell phone and Internet service. It makes you stop and think twice about what is best for you.


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Gardneres

October 10, 2018 10:39 PM

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