It’s hard to believe it’s March already! I want to take a few moments to highlight a few observations from real estate market so far in 2013:
1. More buyers than sellers
2. Low inventory with the need for more.
3. Steadily increasing prices.
4. Regular bank delays causing deals to close closer to 45 days
5. A steady increase in new construction and at higher price points.
All of these things point to bigger and better days ahead. My concern lies with the ability for buyers to get a mortgage and close within 30 days. It is getting worse instead of better, and that is really one of the few things holding people back. I’m all for stricter guidelines than there were several years ago, but it has gotten to the point of being ridiculouse. I have high net worth clients that can’t even close in 30 days due to the regulation on each loan. Hopefully I can report progress on this issue as the year moves forward. Regardless of the issues still at hand, we have a lot to be thankful for with the direction things are going!
The real estate market is off to a strong start so far in 2013. Strong activity for this time of year is a bonus, and promises to get stronger as we get into the spring months. I have been amazed by the number of people inquiring about building a new home. I think developers are going to recognize the need to invest in infrastructure as they see the remaining vacant parcels get sold. I estimate home prices increased around 8% in the Holland area during 2012. That was much stronger than anyone thought. By the time most people recognize there is a recovery going on, much of the recovery will have already taken place. As we go move throughout 2013 I will continue to share information that I think is usual to you as the consumer. Please contact me if you have any questions.
The next bit of technology I wanted to touch on was an app called CamScanner. This application allows you to use your smartphone’s camera as a scanner and fax machine. Just take a picture of the documents you want to send, and you can send it as a pdf or jpg file with the push of a button. There are many practical uses for this, but in the real estate business, this allows agents and consumers to send paperwork on the go. It’s very easy to use, and has extremely good clarity. There are different settings to adjust the brightness and center the documents. Have fun with it!
One little bit of technology that I learned about at the NAR convention, is a little app called “HomeSnap”. Go to your app store and download this app! It allows you to take a picture of any home you want, and it will pull up data about the house and give an estimated value. I would take the value with a grain of salt, but to have info like that with a click of a camera button is remarkable! If you are a homebuyer, or just like to play around with the latest and greatest gadget, I think you will really enjoy using HomeSnap. I will share with you another little piece of technology next week.
This past weekend I attended the National Association of Realtors convention in Orlando, Fl. There was an estimated 25,000 attendees in the largest convention center I have ever seen. There are lots of changes in the real estate industry, but a couple will remain the same:
1.) This is a relationship based business. People remember how you make them feel when you work with them.
2.) Real estate is local. Every house in every area is different. Consumers depend on local professionals to guide them through the process of buying and selling.
Besides those couple points, most everything else is changing. There are some exciting new technology platforms in our business that will change how I interact and provide service to my clients. I am looking forward to implementing some of these things as we move into 2013. I will be sharing some of these changes in the very near future.
Everyone wants to close ASAP when they buy or sell a home. Realtors are more than happy to oblige with those requests. Problem is, it is leaving many buyers and sellers frustrated when there are delays. It is very difficult for banks to close on a loan in 30 days. Underwriting standards have gotten extremely strict, and buyers need to continually provide more documentation during the process. Most banks don’t work on the same set of schedules you and I do. Set your expectations realistically, and plan on 45-60 days to close most deals. If you get it done sooner, that is great, but at least you are setting your expectation going into the deal.
In my recent blog posts, I have mentioned the fact that inventory is light and demand has been good. Prices are slowly rising and new construction is popping up in several areas. Surprise! I has turned into a sellers market! That idea has snuck up on everyone, especially those who don’t work in the real estate field everyday. Buyers are shocked to find out that they can’t find a house they like, or are competing with several offers on the same house. The truth is, we have a long ways to go in order to get back to a healthy housing market, but no longer can we continue to call it a “buyers market”. I believe prices need to come up a little ways yet to convince more sellers to “get off the fence”, and sell their home. Too many people are still “underwater” on their mortgage. Until we get more sellers who can sell, inventory will remain tight. Developers are just starting to recognize this shortage, so most new projects will be a year or two out. It is important to realize this market shift if you are a buyer or seller. It helps frame your expectations, and put in place a timeline to make a move.
This afternoon, the Federal Reserve just unveiled QE3 as its commonly refered to. Chairman Bernanke said his focus with this additional liquidity of money supply in the system will be used to purchase bundles of mortgages off of the balance sheets of bigger banks. This should continue to put downward pressure on mortgage rates, and allow for a larger window of time for those that still want to refinance or purchase at these amazing rates. The Fed is trying to continue the upward momentum we are starting to see in housing prices as well. This should also be viewed as positive for people in the construction trades and the broader economy as well.
The noted downside to all this federal “stimulus” in the long term, is the possibility for more radical inflation. That means interest rates could soar much higher in a quick amount of time. Take advantage of the rates and prices while we have them. Give me a call if I can help.
Back on June 15 of this year I blogged that our inventory was selling through rather quickly. Well now, we are at a point where most agents don’t have many listings, and buyers can’t find enough houses to look at. Most of the homes that have been on the market all summer are either overpriced, need too much work, or some combination of both. Going into the fall and winter are typically slower cylces of the year, but I think sellers who have a nice home and are realistic on price, will find it a great time to sell! This dynamic was unheard of 12 months ago. What a difference a year can make! This may give some sellers the extra push they need to put their house on the market.
Be sure to visit my website and check the local area statistics to see for your self.
I regularly get a house address from a buyer, and then look it up on the MLS, only to find that it has sold or expired. The buyer then tells me that they found the house online so it must still available. The problem is, many buyers are searching for homes from websites that get delayed info from our MLS. These sites provide a disservice to the customer because the data is old. This leaves the buyers feeling frustrated and makes them question who and what they can trust with giving them reliable information.
Be sure to search from the most current data available. My website at www.davearnoldink.com is always up to date. I also put most of my clients on an automatic search directly on our MLS provider. This allows me to plug in the desired criteria that the buyer is looking for in a house, and when any new listings come up that match that, it is automatically sent to the client. No need to search or wonder if you are mssing anything.