Buyers · Real Estate · Selling Real Estate · Statistics

May Market Stats…

The housing inventory (homes for sale) is currently at 6.6 months, which matches April’s housing inventory. The peak of our inventory was 18.6 months back in Feb 2009. Inventory is calculated by dividing the active listings at the end of the month by the number of closed sales for that month.

The average home sale price is down 3% and the median sale price is down 5.4%. Not bad when compared to other parts of the country.

The time it takes to sell a home is down 36.1% compared to May, 2009 stats.  This lower number could have something to do with the first time home buyer tax credit that recently expired on April 30, 2010.  Total market time to sell a home for 2010 is down 19.7% from 2009 statistics.

Interest rates are still incredibly low. If you’re considering  selling your home in the near future and you price your house right, the chances of it selling are high. If you want to buy a home, I highly recommend you talk to a lender first to verify you qualify. Once you’re pre-qualified, start watching the market.

These residential statistics are based on monthly figures reported by RMLS™ of which I am a member.

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Law/Regulations · Real Estate · Selling Real Estate

Washington State Residents, Did you know…

Did you know that effective July 1, 2010 Washington state adopted the 2009 International Building, Residential, Mechanical and Fire Codes?

One change that is of particular interest to the real estate market is the requirement that all existing residences (Residential Building Group R1, R2 and R3) sold on or after July 1, 2011 must have carbon monoxide (CO2) alarms (complying with UL 2034) installed based on this new code and the manufacturer’s installation instructions. This means sellers will be required to install them before selling. Fortunately, a seller should be able to easily purchase carbon monoxide detectors in the smoke alarm section of any local building or hardware store or department.

Starting January 1, 2011 all new construction homes (Residential Building Group R-1, R-2 and R-3) will also be required to have CO2 detectors installed.

According to the Washington State Building Code Counsel, Group R-1 includes hotels & motels, R-2 includes apartments and R-3 single family, except owner occupied single family.

According to the US Consumer Product Safety Commission, Carbon monoxide (CO) is a deadly, colorless, odorless, poisonous gas. It is produced by the incomplete burning of various fuels, including coal, wood, charcoal, oil, kerosene, propane, and natural gas. Products and equipment powered by internal combustion engine-powered equipment such as portable generators, cars, lawn mowers, and power washers also produce CO.

The US Consumer Product Safety Commission reports that on average, about 170 people in the United States die every year from CO produced by non-automotive consumer products. These products include malfunctioning fuel-burning appliances such as furnaces, ranges, water heaters and room heaters; engine-powered equipment such as portable generators; fireplaces; and charcoal that is burned in homes and other enclosed areas. In 2005 alone, CPSC staff is aware of at least 94 generator-related CO poisoning deaths. Forty-seven of these deaths were known to have occurred during power outages due to severe weather, including Hurricane Katrina. Still others die from CO produced by non-consumer products, such as cars left running in attached garages. The Centers for Disease Control and Prevention estimates that several thousand people go to hospital emergency rooms every year to be treated for CO poisoning.

For more information about this upcoming change check out the Washington State Building Code Counsel or your local building code office.

For information about the dangers of carbon monoxide, refer to the US Consumer Product Safety Commission.

Please note that I am not endorsing the above brand of CO2 detector, I merely included a picture to show what one looks like.  They look very similar to smoke detectors. There are also combo smoke and CO2 detectors on the market.

And now for my disclaimer, I’m not a lawyer, so please consult a legal professional if you have questions.

Buyers · Real Estate · Selling Real Estate

New Search Feature Added!

I’m pleased to announce my new Property Search feature has been activated on my website. I’m very excited about adding this powerful feature to my site. It allows you to search for properties, save property searches, have new listings sent directly to your email, request additional information or showings and much, much more.

My website is your doorway to the SW Washington real estate market. Google: JoElla Realty to find me. How easy is that? Please check it out soon and let me know what you think. byjoella.com

Real Estate · Statistics

The market stats are in…

Stats for June are in!  The inventory of homes on the market for the month is DOWN from 11.1 in May to 7.9 in June for SW Washington.  That compares to 12.6 a year ago and 6.8 two years ago!!! Portland is down 10.2 to 8.2, which compares to 9.5 a year ago and 5 two years ago.

The Inventory in Months statistic means that based on current trends, if no more homes went on the market, the current inventory would exhaust itself in 7.9 months.  This supports my comment I made in my May 29 post, “… this waiting game can give a false illusion that there are more houses available than there really are. When the bank finally responds, the short sale homes will finally drop from the active list, but remember, the activity was generated months before.”

Market time in June dropped to to 153 from 167.  That means if you put your house on the market, the average days on market before it sells is 153 days.  YTD pending sales are up 6.2%.

The average sale price change is down 13.2 from a year ago.  That means homes are selling for an average of 13.2% less than a year ago.  Since this is an average, one might wonder what areas are doing better?  Good question!  The YTD average sale price with the least change reported in SW Washington is SE County (16.0%), Cascade Park (-0.4%) ,  Battle Ground (-9.5%), and West of I5 County (-5.2%).  That means that home in these areas are selling for closer to the same price they sold a year ago.

These statistics are based on monthly figures reported by RMLS™ of which I am a member.

Buyers · Real Estate · Selling Real Estate

Rumors…

The information out there is confusing. I’ve read you can and you can’t use the $8000 tax credit as a down payment when buying a house.

I recommend a buyer talk to their trusted lender to find out what programs are available to buy a home. Most likely, if it sounds too good to be true, it is. If you don’t have a trusted lender, ask for a referal from someone you know. When dealing with someone you don’t know, check references, look up their business license, look up their company name on the Better Business Bureau, check with your local Chamber of Commerce or Angie’s List.

I’ve heard credit scores are vital when purchasing a home today. Apparently credit scores are more important than how much money you have for a down. You could have a large down, but if your credit score isn’t adequate, you may have trouble getting a loan. An idealistic credit score is 720 and above, although FHA and VA are more liberal regarding credit scores. I’ve heard lenders are requiring higher credit score standards when lending for investment property.

I’ve also been told several stories about people that put large amounts of money down on homes during the housing boom and later, when their home value dropped, they walked away expecting the bank to take their loss. Since banks are in business for a profit, it is now harder to get the banks to forgive a debt when they release the home (as collateral) on a loan if there is still a balance owned. Today, some banks are leaving themselves a window (in the small print) to allow them to continue to pursue any balance owed after a home is sold to the next buyer in a short sale (sold for less than is owed).  More banks are unwilling to absorb all the real estate losses, so they are going after the person that didn’t pay off their loan they promised to pay at closing (all buyers sign a promissary note promising to pay their loan back).

Remember, when in doubt, consult with a real estate attorney to find out what the small print means.

Real Estate

FSBO… Does it really save you money?

First I must confess, I have sold For Sale by Owner (FSBO) in the past.  With all my husband and my experiences with buying and selling, we knew what we was getting into; however, not ALL people know what they are getting into when they attempt to sell FSBO.

All that said, there are things people need to know about FSBO!!!

It’s a double edged sword. Most FSBO sellers think they can save money selling without an agent. Guess what! Most people shopping FSBO think they can save money too! They think they can offer less because a FSBO isn’t paying a commission! So who is really saving money???

I saw an advertisement on craiglist.org that caught my eye regarding their FSBO services.  They advertise the opportunity to list your FSBO property on the Multiple Listing Service (MLS) for a flat fee and save money. Like all businesses, companies like these make money from selling their services. If they didn’t, they wouldn’t advertise the service in the first place. I can respect a business’ right to generate business. I would, however, like to refute some of their statements regarding the advantages of using a flat fee type of service.

They say: You set the asking price.
TRUTH: When using a real estate agent, you decide the asking price.

They say: You choose the commission to pay the buyer’s agent who brings an acceptable offer.
TRUTH: You decide how much you want to pay a Realtor® that brings you an acceptable offer and you negotiate how much you want to pay a Realtor to sell your property.

They say: You control the marketing.
REALITY: You do all the work promoting your property, the flat fee company only puts your home’s information into the MLS. You compete with all the licensed Realtors out there that are promoting the large inventory of homes that are already on the MLS.

They say: You control the negotiations of offer.
REALITY: A full service listing Realtor handles the negotiations for you. They are trained for this job. A Realtor is required to abide by the laws that govern the process of buying and selling a home. If there are problems, the Realtor deals with the hassle and relays that information to you (the seller).

They say: Buyers and buyers agents contact you directly.
TRUTH: Your Realtor takes all the calls for you and qualifies the good leads to you.

They say: If you sell your home yourself, you pay no commission at all.
TRUTH: Only if you sell to someone that is NOT working with a Realtor! Check with a real estate lawyer on this one!!!

They say: One time fee.
REALITY: If you pay a buyer’s agent (Realtor) a commission to bring you a buyer, you are paying more than a one time fee. Also, beware of flat fee services that have short term expiration dates and hidden fees for additional services that might come about during the process of selling your home.

The bottom line is this: Pricing your house right is critical to selling your home! It’s NOT what you think your house is worth that sells it, it’s what the buyer is WILLING to pay for your home that dictates what it is worth!!!

Remember, there are people out there that take advantage of people that don’t know what they are doing. Don’t be one of them!!! If you don’t have enough experience selling or buying a home, don’t try it alone. Get a licensed real estate professional that adheres to a high level of customer service, preferably one that comes with a referral and/or recommendations, to help you with the process. And remember, you can always terminate your contract with a Realtor if you feel they aren’t providing you with good service. (You just can’t terminate it to avoid a commission if they bring you a buyer.)

I am not a real estate attorney.  If you have any legal questions, you should consult with a Real Estate Professional.

Law/Regulations

Short Sale Debt Relief Act…

For a person about to lose their home to foreclosure, this information is important.

Prior to 2007 a seller would have to pay capital gains on the portion of their loan that a mortgage company writes off for them to sell their home in a short sale.  Today, “The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.”  This change is effective 2007-2012.

For more information, see:  http://www.irs.gov/individuals/article/0,,id=179414,00.html

I am not a tax professional, so please consult with a tax professional before making any tax decisions.