The most informative Real Estate Blog in St. Louis
The residential housing market has been hot. Home sales have bounced back solidly and are now at their second highest pace since February 2007. Demand remains strong going into the winter. Many real estate professionals are reporting that multiple offers are occurring regularly and listings are actually selling above listing price. What about your house?
If your home is on the market and you are not receiving any offers, look at your price. Pricing your home just 10% above market value dramatically cuts the number of prospective buyers that will even see your house. (See Chart)
The housing market is hot. If you are not seeing results you want, sit down with your agent and revisit the pricing conversation.
As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As either a first-time or repeat buyer, you must not be concerned only about price but also about the ‘long term cost’ of the home.
There are many factors that influence the ‘cost’ of a home. Two of the major ones are the home’s appreciation over time, and the interest rate at which a buyer can borrow the funds necessary to purchase their home. The rate at which these two factors can change is often referred to as “The Cost of Waiting”.
According to CoreLogic’s latest Home Price Index, prices are expected to rise by 4.7% by this time next year.
Additionally, Freddie Mac’s most recent Economic Commentary & Projections Table predicts that the 30-year fixed mortgage rate will appreciate to 4.7% in that same time.
Here is a simple demonstration of what impact these projected changes would have on the mortgage payment of a home selling for approximately $250,000 today:
This well maintained 3 bed 2 bath ranch home is ready for new homeowners! Upon entry the open living area offers a guest closet, vaulted ceilings, plant shelf, and opens to a nice size eat in kitchen. The kitchen has plenty of cabinet space, new laminate hard wood floors, and a separate food pantry. Down the hall find the 3 bedrooms, 2 bedrooms share the hall bath and the Master Bedroom has it's own full bath! Plenty of closet space, main floor laundry room, 2 car garage with new garage doors, new roof, new hot water heater and much more! Walk out to the huge level, fenced, back yard. The lower level awaits your personal finishes. Better Hurry this gem won't last!
According to a joint study released by Google and the National Association of Realtors, 2 of 3 people searching for a prospective real estate professional research them “extensively online prior to working with them". And, that number is probably increasing every day.
Are social media channels such as Facebook really a good place to gather information about an agent before using them? If so, what should you look for?
There is a plethora of information on any subject available on social media sites such as Facebook. A recent study by the Pew Research Center revealed that 63% of Americans now even get their news from Facebook (up from 47% in 2013).
It is no different for both buyers and sellers of real estate. Yes, Facebook is a good place to gather information about the housing market and “checkout” an agent you are considering hiring to help buy or sell a home.
You want an agent that cares more about you and your family than they care about bragging about themselves. One way to determine this is to look at what they post on their Facebook page. Are they more interested in ‘hawking’ a listing or bragging about their accomplishments or are they trying to post insightful information that will help you make the best decision for you and your family?
At a recent real estate conference, Guy Kawasaki, an executive fellow at the Haas School of Business at U.C. Berkeley, gave the following advice to the Realtors in attendance:
“Value comes in the form of information and assistance. You want to establish a position where people see - through your social media efforts - that you know what you’re doing and are helpful…The point is to make yourself useful and valuable. To build credibility; to build trust…”
In school we all learned the Theory of Supply and Demand. When the demand for an item is greater than the supply of that item, the price will surely rise.
The National Association of Realtors (NAR) recently reported that the inventory of homes for sale stands at a 4.8-month supply. This is significantly lower than the 6 months inventory necessary for a normal market.
Every month NAR reports on the amount of buyers that are actually out in the market looking for homes, or foot traffic. As seen in the graph below, buyer demand this year has significantly surpassed the levels reached in 2014.
Many buyers are being confronted with a very competitive market in which they must compete with other buyers for their dream home (if they even are able to find a home they wish to purchase).
Listing your house for sale now will allow you to capitalize on the shortage of homes for sale in the market, which will translate into a better pricing situation.
Many homeowners underestimate the amount of equity they currently have in their home. According to a recent Fannie Mae study, 37% of homeowners believe that they have more than 20% equity in their home. In reality 69% of homeowners actually do!
Many homeowners who are undervaluing their home equity may feel trapped in their current home, which may be contributing to the lack of inventory in the market.
If you are debating selling your home this year, let's get together to evaluate the equity you have in your home and the opportunities available in our market.
This 2 bedroom 2 bath ranch is ready for its new owners! Upon entry, notice the spacious living room with a bay window and newer carpet. The separate dining room is a great space for entertaining! Walk in to the updated kitchen and find granite countertops with undermount sink, newer faucet, gas range, granite backsplash and plenty of cabinet space. The master bedroom suite offers newer flooring, ceiling fan and the master bath has an updated vanity, shower and a convenient laundry area. Walk out to the large deck, great for entertaining, and enjoy the screened in back porch on those warm summer evenings. This home is on a large double lot with a newer cedar privacy fence. Building in the back of the lot with electricity run to it is an extra BONUS!! Additional sleeping area in the lower level. Upgraded Leaf Guard Gutters and Newer Roof with Architectural Shingles. Don't miss this one!
