SO Real Estate

Value of Home Construction

2011-12-19T09:17:00.000-08:00

I read an article today from the National Association of Home Builders (NAHB). In it they discussed how hard the home building industry has been hit by this recession. They reported one in three transactions is falling apart because appraisals are coming in lower than the sales price.

It is more difficult for the value of new homes to meet appraisals because of the huge number of distressed homes on the market. The NAHB said, "Too often, due to faulty appraisal practices, brand new homes with sparkling appliances and interior upgrades get compared to a distressed property that has been sitting vacant and in disrepair."

The NAHB says it's no wonder so many builders aren't building. They believe this is pushing the economy to the brink. The NAHB reports that new-home construction is a key to economic recovery. One hundred new homes can mean 300 full-time jobs and $8.9 million in federal, state, and local tax revenue.

"Resolving inappropriate appraisal practices and restoring the flow of credit to home builders will not only help to put America back to work, it will provide badly needed tax revenues that is essential for local governments to support schools, police and firefighters in communities across the land," said NAHB Chairman Bob Nielsen.

Home Prices

2011-12-16T09:25:00.000-08:00

A November 29, 2011, Case-Shiller press release had the headline that Home Prices Weaken as Third Quarter of 2011 Ends. The thing that caught my attention is it said, "Nationally home prices are back to their 2003 Q1 levels." If you would like a copy of the report, let me know. I can email it to you.

So if you are trying to figure out how much your home is worth, you may want to take a look at what it was worth in 2003. The buyers are.

Remember, real estate values are based on the local supply and demand. I see inventory drying up and prices stabelizing. There is more activity by the builders now and even thought the banks are still hanging onto their money, things are starting to move forward. Prices will follow.

If you are thinking about buying a home, now is a good time. Call me at (541) 210-6698 and I can help you find a great deal on the right home.

Merry Christmas,

Tom

Southern Oregon Real Estate Statistics and a New Listing

2011-12-09T14:53:00.000-08:00

Happy Friday!

We recently listed a wonderful and historic home at 4533 Old Stage Road, Central Point. You can see an infomercial on it at http://www.tmonson.com/videos.html see historic home video.

The number of sales this year from September 1st to November 30 was down slightly from the same period last year. New home sales were up slightly.

The number of homes on the market has gone from 1912 to 1455. This is a big drop in inventory.

Almost half the sales were either foreclosures or short sales. When you consider they make up about a quarter of the inventory, it makes me think people are jumping on the better priced properties out there.

I have noticed quite a few foreclosures hitting the market now. I've seen some pretty cheap properties (under $40,000) lately.

Have a great weekend.

Consumer Confidence Rises

2011-12-02T16:19:00.000-08:00

It's gone almost without and fan fair but consumer confidence has risen substantially over the past week. I can't find out any concrete reason other than I suspect it has to do with the central banks in Europe have made moves to stabilize the Euro. It may also be because black Friday was 16-20% better than last year. In any event, it is a welcome change.

I have seen a significant number of new bank-owned listings hit the market. Some of them are at pretty low price levels. I think we may test the lows of last winter. It feels like the market is stabilizing.

Interest rates are still very low - in fact looking at the chart they are at the lowest rate since 1972. If you know someone who is thinking about buying, now may be the best time ever. Low priced homes and cheap interest rates add up to paying less for a house payment than to rent a similar house. Of course that depends on a person's credit and payment ability.

You can access the multiple listing service at www.tmonson.com. Let me know if there is anything we can do to help.

Mortgage Rates Still Low Existing Home Sales Improve

2011-11-28T14:47:00.000-08:00

I was just part of a conversation concerned with banks and how they are falling behind on funding loans on purchases. The reason? They are slammed on refinancing existing mortgages. Seems that they didn't figure the number of refinancing loan applications and they were caught under staffed. So they are putting the purchase applications aside to fund the more profitable refinance loans. Whether or not it's true, I don't know. I do know the two loans I am trying to get through are taking forever to get done.

That's probably because Freddie Mac Primary Mortgage Market Survey® (PMMS®), showed the average fixed mortgage rates changing little and remaining near their historic lows (3.98% this last week) while adjustable-rate mortgages averaged new record lows.

Amidst turmoil in the stock market and continued crisis in both our own and European debts, the latest figures from the National Association of Realtors show that existing-home sales improved slightly in October. Though this rise was marginal, any upward movement is reason for some holiday cheer in the real estate market. (Realty Times)
I forgot to mention that we have redone our website: www.tmonson.com. Check it out.

Really Great Deals

2011-11-22T09:19:00.000-08:00

Happy Tuesday,

Every day I monitor the new listings that come on the market and am sometimes amazed at the incredible deals.

How do I know they are deals? Good question. Here's how: If you can buy it for less than you can rent it, then it is a good deal. If you are renting now and your credit is not bad, then you should look at the implications of buying vs renting. By the time you add the tax benefits and the potential for long term appreciation buying makes more sense.

How much house to buy? That's a great question also. Let me put it this way, you have to have a place to live right? Buy a house you can afford. Buy a house where you know that no matter what you can generate enough of an income to make the payments -- no matter what.

Have a wonderful Thanksgiving. Even in these tough times, we have so much to be thankful for.

2012 Outlook for Southern Oregon

2011-11-21T14:01:00.000-08:00

According to Realty Times next year is supposed to be the year for the buyer. Meaning that there are more foreclosures coming on the market. I can tell you that there have been a constant flow of new foreclosures coming on the market. I have noticed that prices are a little more stable of late. I translate this to mean that maybe, and I stress the maybe, we are not going to see prices take meaningful declines in the months to come. I remain optimistic.

A Nation of Renters?

2011-11-17T14:47:00.000-08:00

Here's something worth sharing: According to the National Association of Realtors®, (NAR) the U.S. will not become a nation of renters. Currently, over 65 percent of Americans are homeowners, a rate that has held since the 1960's. It's no wonder why most Americans seek out a home of their own.

Homeownership has both financial and social benefits. According to the most recent data from the Federal Reserve Board, a homeowner's net worth is 45.9 times that of a renter's.

Show me the money!

What's Your Market

2011-11-16T16:50:00.000-08:00

I am asked almost every day about the real estate maket.

I can't speak for all markets but since I work in it every day, I can speek to what is happening in this market.

In my opinion, overall we are moving from a “buyers market” to what’s referred to as a “balanced market.” A balanced market occurs when markets are changing from a buyer’s market to a seller’s market or visa versa. The change is directly related to the inventory (number of homes available on the market).

The following chart shows the number of months of supply based on the price:

Price Range	Months of Supply
Under $99,999	2.8
$100,000 - $199,999	3.9
$200,000 - $299,999	8.2
$300,000 - $499,999	13.9
Over $500,000	29.3
Total	6.9

This is truly a tale of two markets. Inventory levels for entry level homes and rental properties are low. Where the inventory levels for the more expensive homes is high. It is also important to note that the majority of sales in the past six months (83%) sold for less than $300,000.

What this means: if you are trying to buy a lower-priced home, you do not have a lot to choose from (this is considered a “seller’s market). If you are looking at a more expensive home, you have a lot to choose from (this is a buyer’s market). When it is balanced it is a market in transition. Overall, that is where we are at today.

This also means that if you want to sell your home, this may be the best time in the past few years.

I'm reworking our web site to reflect today's market. Go to http://www.tmonson.com/ and let me know how we could do a better job for our clients in providing what kind of information on our site. Thanks,

Southern Oregon Real Estate

2011-11-15T19:09:00.001-08:00

In the coming months and years, I plan to post what is going on in real estate in Southern Oregon (SO). I will start with this:

In the last three months there have been more short sales than REO (foreclosure) sales. This could signal one of two things 1) banks are changing their ways of doing things or 2) the inventory of foreclosures is lower.