Pitfalls to selling your home

Even though we are in a stronger housing market, and many listings are getting multiple offers, some listings just sit on the market. I takes about 90 days, on average, to sell in today's market. The single largest contributor to a slow sale or no sale is unrealistic pricing by the seller.  Market savvy buyers are well informed on pricing and will not "bite" on the sellers "hopeful" pricing. In many cases they will not even visit an overpriced home. Having a qualified real estate agent properly position your home in the right price range is critical to the selling process. Here area few other things that can hamper the sale of your home.

Imposing severe restrictions on when and by whom the house can be shown. For example, sellers who will only allow showings between 10 a.m. and noon on Saturdays, or who require a 24-hour advance notice before appointments to show during the week, or who won't let anyone in unless they or the listing agent are present, inevitably delay offers and sales.

 

Other big turnoffs:

·        Poorly cleaned, messy houses with obvious deferred maintenance.

·        Sellers who insist on being present — or hover nearby — when shoppers visit so they can point out every feature they improved or like. Better for sellers to be out of the house or out of sight.

·        Smells inside the house that are either bad — especially from dogs, cats and other pets — or come across as contrived, such as scented candles, potpourri plug-ins, etc.

 

 

Apartment market booming

Apartment complexes are sprouting up all over the Tampa Bay area. Right now, plans are in the works for 10 new complexes. The 311 unit NoHo Flats bordering downtown Tampa, is an example
of what is happening.  Fueling this building boom have been people making short sales and then being forced to rent until their credit can be restored. One out of every 5 sales these past few years has been a short sale. Lower paying jobs, and higher rents, are reflected in the statistic that 49.3% of renters pay more than a third of their income in rent. The average rent is about $900 in the Tampa Bay area. Recently, many institutional investors have begun buying up homes and turning them in successful rental units. They see the financial return on these rentals much more attractive than the low paying money markets. Downtown Tampa now boasts 5000 inhabitants vs. just a few hundred 10 years ago.  

Strong U.S. Growth rate at 2.5%

The U.S. economy grew at +2.5% in the January-March quarter, up from the anemic growth rate of +.4% in the October-December 2012 quarter. Consumer spending increased +3.2%, the best showing since the end of 2010. Most economists are projecting the growth rate will slow in the April-June quarter to +2.0%. Had government spending not be down by -4.1%, the economy may have reached the growth rate of +3% where many economists think the second half of 2012 will achieve.

Confidence up in job market

Americans are gaining confidence in the job market. The level of confidence has returned to the normal range after dropping significantly in the downturn. Now,  54% of Americans think they would find a new job if they lost their current one. This is closer to the normal 58% and well above the low point of  46% in 2010, the lowest point since 1983. Employers added 2.2 million jobs in 2012, averaging about 180,000 a month. This confidence they could find a new job encourages more consumer spending and boost economic growth.

Housing will drive economy this year

Economists agree that the rebounding housing market will be a significant factor in the improving economy. Sales of new homes in March rose +1.5% to a seasonally adjusted rate of 417,000 units. This is an +18.5% increase over last year's 352,000 units. The sales pace considered healthy ins 700.000 units monthly. The median price of a new home was $247,000 up +3.0% from a year ago.

Sweet upwards movement for home sales

Rising prices, multiple offers, and bidding has come back to Tampa. Prices in Tampa Bay rose +20%
since last year. Single family homes sales increased +17.4% in March. Large institutional investors are buying up homes and creating rentals out of them. Most of these sales are cash and in March, 48.4% of all sales were cash. Condo sales grew slower but pricing moved up +15% to a median price of $92,000. The median single family home price is $144,049.

Pinellas County home sales on rise

Pinellas County, Florida March Home Sales

Courtesy of Pinellas Realtor Organization

 

 

 

Sales are up and inventory is down. Home prices are increasing with the average price at $145,000
vs. $132,000 a year ago. Things are definitely improving within the housing market.

Mortgage interest rates dip last week

The rate on an average 30 year fixed rate mortgage dropped last week to 3.41% down from the previous week of 3.43%.  The 15 year mortgage rate dropped to 2.64 from 2.65 a week before.

Those seeking unemployment benefits leveling out

Last week, about 4000 more people applied for unemployment benefits. This may suggest that sluggish March numbers may only be temporary. The 4 week average of those seeking benefits averaged 361,250 over the last 4 weeks.

Homebuilders break the 1 million mark

Home starts in March reached 1.04 million rising 7%. Apartment construction rose 31% reaching annual rate of 417,000 unit the fastest pace since January 2006.

Where are all the workers going?

America created only 88,000 jobs in March. This was disturbing at best. Even more disturbing was the report that 495,000 people disappeared from the work force...gave up looking for a job. This is the only reason the unemployment rate dropped to 7.6%. It actually increased if these folks were counted. Here is some more disturbing news. Questions have been asked as to why the Asian unemployment rate is only 5%, while it is  9% among Hispanics, and 13% for African Americans. Another shocking statistic is the fact that 9 million American workers in the age group 20-64 (almost 5%) are receiving disability, as compared to 1.5% of the work force in 1971. The workplace is supposed to much safer now that one would expect this number to be lower. The estimate for those unemployed, underemployed, or have stopped looking for employment is 14% of the workforce. The participation of eligible workers for employment has fallen to 63.3%, the lowest level going back to Jimmy Carter's administration.

Mortage interest fall sharply

Interest rates on a 30 year fixed rate mortgage fell to 3.43% down from 3.54% last week. This is approaching the low that was seen in November 2012 at 3.31%. That was the lowest rate going back to 1971.  The average rate on a 15 year mortgage was 2.65% down from 2.74%.

Florida 1st in Foreclosures

A Realty Trac study shoes Florida was #1 in foreclosure activity. During the first quarter of 2013, 85,671 homes in Florida got some kind of foreclosure filing. About 36,000 received first time foreclosure notices. Last year, the number was 73,344. This year's figure is a +17% jump. With Florida having 8.9 million housing units, this means that one out of every 100 homes saw some kind of foreclosure activity in the period. Among 209 metro areas studied, Miami, Orlando, and Ocala finished first through third, Las Vegas was  4th and Tampa Bay came in 5th place. In Tampa Bay, There were 13,491 homes who received some kind of foreclosure activity in the first quarter.

Guest Editorial addressing shadow inventory

A Brief Introduction to the Shadow Inventory

By Sarah Parr       ( contact:  sarah@floridaforeclosedlawyer.com)

A report by CoreLogic shows that the shadow inventory of homes in the United States, with 2.2 million housing units, decreased 28 percent in three years. The number of seriously delinquent homes, properties in foreclosure and homes held as REOs (real estate-owned) by mortgage servicers, but not yet listed on multiple listing services (MLS) were used by CoreLogic to determine the shadow inventory figure.

The shadow inventory

The U.S.’s shadow inventory comprises of a variety of homes not featured on the market. Half of the shadow inventory consists of vacant properties in some phase of foreclosure, also known as “zombie foreclosures.” Many homeowners vacate homes when they can no longer afford to pay their mortgage and anticipate foreclosure. Another part of the shadow inventory consists of the homes held by banks, but not up for sale yet, and homes that owners are holding off putting on the market.

The source

RealtyTRAC reports that the source of the large shadow inventory was caused by the finalization of the National Mortgage Settlement in April illustrated by a 59 percent jump in properties in some stage of foreclosure. The settlement invigorated pending foreclosure cases, as banks re-filed or were required to work with homeowners on alternatives to foreclosure, keeping their homes off the market. As Longwood foreclosure attorneys will tell you, shadow inventory mainly grew in judicial-process states since these states are prone to a buildup of foreclosure cases.

The consequences and the silver lining

Real estate market analysts feared that a simultaneous release of shadow inventory properties would greatly reduce prices. On the other hand, the shadow inventory properties have been slowly listed, and the smaller inventory has led to an increase in prices in some communities, Reuters reported. Single investors and investment firms have also tapered possible flooding of the market by purchasing large quantities of these homes when they are first listed, according to TIME.

The existence of shadow inventory creates uncertainty for homeowners looking to sell their homes and for predicting when a local housing market can expect full recovery. Shadow inventory can also cause housing data to underestimate the amount of inventory in the market. Nevertheless, there is a silver lining: consumers can expect a steady flow of inventory becoming available, especially in Florida, because of the large amount of shadow inventory. Presently, Florida has approximately 16 percent of the nation’s shadow inventory. Once a portion of these properties go through the long judicial-foreclosure process, Florida can count on a solid increase in housing inventory. Lawmakers are looking to remedy Florida’s long foreclosure process as well. The housing market will benefit greatly from a measured increase in supply for those eager to buy.

My Blog is always open for guest editorials like Sarah's which offer great information which benefits and educates us about the housing market.

Ford Focus is the best selling car in the world

2012 was a great year for the Ford Focus.  Ford Focus registrations reached 1.02 million in 2012, surpassing the perennial best seller, Toyota Corolla which totalled 872,774 registrations. In third place, was the Ford 150 pickup, the Ford Fiesta came in 6th, and the Chevy Cruze was 8th, beating out Honda Civic as reported by R.L. Polk & Co. data. Leading auto makers in the U.S. are building their best cars in years, and it is showing up in the sales results worldwide.

More jobs...slow hiring

In February, U.S. employers advertised the most job openings in nearly 5 years. However, companies are filling jobs at a much slower rate being concerned about the economy's recovery. The number of
job openings was up +8.7% in February from January reaching 3.93 million, the most since May 2008. Companies hired 4.4 million people in February, up 2.8% more than January, but still down
from a year ago when it reached 4.49 million. A healthy economy usually has a ratio of 2 to 1 unemployed people for each opening. Currently, the number is 3.1. Some of the reasons for the slow hiring are lack of skills employers are looking for, low pay, and concerns about the recovery.

Lexus to go sporty

Having lost its leadership position to BMW and Mercedes in the U.S., Lexus will begin introducing "performance" cars to compete for more market share. Lexus contributes about 20% of Toyota's profits according to analyst Koji Endo with Advanced Research Japan. A new IS sport sedan will be targeted at entry level younger buyers who might be lost to German automakers.

Gas prices dropping

In the past 2 weeks, gas at the pumps has fallen over 6 cents a gallon. It has now fallen for 6 straight weeks. Gas prices today are 32 cents a gallon less than a year ago.

Economy not back yet

Even with the stock market in record territory, housing sales on the rise, strong retail sales in many sectors, we still have a ways to go for a sustained recovery. There are 7.7 million people unemployed, and 3 million less jobs than when the recession began. After 5 tough years, the economy is almost
back to when the recession started in December 2007.

Auto sales pushed by strong demand for pickups

The demand for pickup trucks in March helped drive auto sales to its highest point since August 2007. Ford, GM, and Chrysler reported selling 154,722 full size pickups in March...up +14% vs. 2012. Auto sales rose +3.4% over March of 2012. The new Altima outsold the perennial top selling Camry in March, and the newly designed Accord was right on its heels. Total auto sales in March reached 1.45 million units...again the best performance since August 2007.

Fannie Mae reports $17.2 billion earnings

Foreclosures are declining, new home construction is gaining strength, both indications the housing market is continuing to recover. Fannie Mae reported profits of $17.2 billion for 2012 and expects to remain profitable in the future. Fannie Mae also paid $11.6 billion in dividends to the U.S. Treasury this past year. These are all heartening signs things are improving in the housing market.

Headed towards best real estate market in 12 years

According to RealTrends, we are heading into the best spring season in eight years. The publication went on to list three things that real estate professionals should watch:

 

1. Inventory- with inventories at 13 year lows, will the banks, Fannie, Freddie and others begin to release the overhang of foreclosed properties? Will the increase in prices begin to bring more homes to the market from those who have been unwilling or unable to consider a sale?

 

2. Interest rates- they have headed up for several weeks now and indications are they will continue to rise slightly. Historically, this brings sidelined buyers into the market. Will the clash of increased buyer activity and low inventory cause prices to leap in the next few months - and will this bring even more sellers into the market?

 

3. Off Market Listings- will the tightness of inventory and the opportunity to increase incomes from double sided transactions cause the percent of off market listings to grow even more than it already has? And will this result in even more tightness in inventory available to the market in the highest activity time of year? Normally this drives prices up rapidly. Watch unit sales, pricing and inventory levels over the next few months as these will provide answers to these questions. An off market listing is kept out of the MLS and marketed through advertising to agents. The general public is not aware these homes are for sale.

Housing market gaining real strength

    Things Really looking up in the housing market.

· Florida unemployment drops to lowest level in four years. Florida's unemployment rate dropped to 7.7 percent last month, below the national rate of 7.9 percent and plunging to its lowest point since October 2008.

· Defying national trend, Floridians' confidence up. The latest numbers from the University of Florida’s consumer-confidence index showed a small gain, even as a national barometer recorded renewed worry among consumers who have been facing higher gas prices, higher deductions from their paychecks and seemingly endless headlines about cutbacks from Washington.

 

· Good news for residential real estate. The S&P/Case-Shiller 20-City Composite index released March 26 showed January home prices posting their largest year-over-year increase since the summer of 2006. The index, which tracks single-family home prices in 20 large cities, improved 8.1% with all 20 cities posting year-over-year price gains.

· Housing Starts rose slightly in February. Nationally, starts are coming in above expectations and up 28 percent since this time last year. Both Single-Family Housing Starts and Building Permits also increased, reaching their highest levels since June 2008

Real Estate wealth improved $1.4 Trillion in 2012

 A lack of inventory has slowed home sales in some markets yet rising prices are encouraging more people to place their homes on the market. Existing homes for sale rose 10% in February, according to the National Association of REALTORS^®.
Rising home prices are also driving down the threshold of underwater homeownership. CoreLogic reported in late March that another 200,000 residential properties returned to a state of positive equity during Q4. For all of 2012, 1.7 million homes moved from negative to positive equity, CoreLogic said.

Accordingly, household real estate wealth increased by $1.4 trillion in 2012, according to the Federal Reserve, which suggests that more homeowners will return to the real estate market to buy and sell.

Higher home prices also have activated homebuilders, who in February broke ground on a seasonally adjusted annual rate of 910,000 homes, the second-fastest pace since June 2008, according to the Commerce Department.                    Source:  Prudential Tropical Realty Monthly Newsletter, April 1, 2013