Wednesday, February 6, 2013
Thursday, November 29, 2012
Michigan Monthly Market Update-November 2012
Michigan Monthly Market Report - November 2012
October was the most active new purchase month in the past two years, giving some great momentum going into the winter. With inventories at 10-year lows and buyer activity building, this should be a wild winter for Buyers chasing their perfect home.
To give you a snapshot for the cause of inventory decline, over the past 90 days sales were up 22%. Meanwhile, the number of new listings placed on the market fell 6% compared to last year, which accelerated area appreciation rates. Appreciation Momentum is growing 2012 vs. 2011 % Change in Price per Square Foot - SE Michigan October 18.30% September 14.80% August 12.80% These growth rates are a combination of fewer lower-priced homes for sale and a growing rate of appreciation. Separating the two is not an exact science, however it appears that at least a third of the growth rate (or 6%+-) is a true value increase.
Should I stay or should I go? A great song by The Clash, but with prices rising, also a good question for today's Sellers, "Sell now or wait?" Since housing is not just about the financial gain, the answer depends as much on your personal housing goals as timing the rate of appreciation. However, if you are looking to move up to a larger home, there is no doubt you should be looking now. The math is clearly in your favor! Should I Stay or Should I Go?
Current Home Value $100,000 Value in 2 Years $118,000
Gain by Waiting $18,000
New Home Value Today $170,000 New Home Value in 2 Years $201,000
Gain by Buying Now $31,000
Loss by Waiting ($13,000)
$31,000 - $18,000
Plus: Cost of extra interest ($18,000) 3.7% mortgage vs. 5.5 in 2 Years
Total Cost of Waiting 2 Years ($31,000) per $100,000 of home value
*assumes a 10 year holding period. For simplicity, does not consider closing costs or tax effects
Right now, a first-time buyer has all the best pieces in their favor to buy. Rising rental rates, low home prices and low interest rates make a once in a lifetime combination. Those downsizing should consider the future interest rate increase, which makes a move today worthwhile. A 1% rise in interest rates will offset a 12% rise in appreciation. We anticipate strong appreciation over the next couple of years, but not 12%. Though, interest rates most certainly will rise 1-2% in the coming years.
Anyone who is considering selling in the next few years should be making plans now, so they can test the market in 2013.
In that vein, we have a great new market update video for you to use to get an overview of your local market area. It's only one-minute in length with great charts and a voiceover. Click this link to see how it works! http://video-portal.sundaysky.com/realestateone
If you would like more information on the market, like to list your property, or want information on any property with any broker, you may call or email at anytime.
Thank you, Conne Terova
Realtors That Make It Happen For You!
P: 248-318-7342
cterova@yahoo.com
www.teamterova.com
October was the most active new purchase month in the past two years, giving some great momentum going into the winter. With inventories at 10-year lows and buyer activity building, this should be a wild winter for Buyers chasing their perfect home.
To give you a snapshot for the cause of inventory decline, over the past 90 days sales were up 22%. Meanwhile, the number of new listings placed on the market fell 6% compared to last year, which accelerated area appreciation rates. Appreciation Momentum is growing 2012 vs. 2011 % Change in Price per Square Foot - SE Michigan October 18.30% September 14.80% August 12.80% These growth rates are a combination of fewer lower-priced homes for sale and a growing rate of appreciation. Separating the two is not an exact science, however it appears that at least a third of the growth rate (or 6%+-) is a true value increase.
Should I stay or should I go? A great song by The Clash, but with prices rising, also a good question for today's Sellers, "Sell now or wait?" Since housing is not just about the financial gain, the answer depends as much on your personal housing goals as timing the rate of appreciation. However, if you are looking to move up to a larger home, there is no doubt you should be looking now. The math is clearly in your favor! Should I Stay or Should I Go?
Current Home Value $100,000 Value in 2 Years $118,000
Gain by Waiting $18,000
New Home Value Today $170,000 New Home Value in 2 Years $201,000
Gain by Buying Now $31,000
Loss by Waiting ($13,000)
$31,000 - $18,000
Plus: Cost of extra interest ($18,000) 3.7% mortgage vs. 5.5 in 2 Years
Total Cost of Waiting 2 Years ($31,000) per $100,000 of home value
*assumes a 10 year holding period. For simplicity, does not consider closing costs or tax effects
Right now, a first-time buyer has all the best pieces in their favor to buy. Rising rental rates, low home prices and low interest rates make a once in a lifetime combination. Those downsizing should consider the future interest rate increase, which makes a move today worthwhile. A 1% rise in interest rates will offset a 12% rise in appreciation. We anticipate strong appreciation over the next couple of years, but not 12%. Though, interest rates most certainly will rise 1-2% in the coming years.
Anyone who is considering selling in the next few years should be making plans now, so they can test the market in 2013.
In that vein, we have a great new market update video for you to use to get an overview of your local market area. It's only one-minute in length with great charts and a voiceover. Click this link to see how it works! http://video-portal.sundaysky.com/realestateone
If you would like more information on the market, like to list your property, or want information on any property with any broker, you may call or email at anytime.
Thank you, Conne Terova
Realtors That Make It Happen For You!
P: 248-318-7342
cterova@yahoo.com
www.teamterova.com
Thursday, January 26, 2012
Michigan Market Update 2011
Real Estate One
Conne Terova
Conne Terova
248-318-7342
Visit my website
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Michigan Monthly Market Update - December 2011
December showed a bounce back in buyer activity from a slight slowdown in September through the first half of November. Pending sales were up along with showings and website activity.
With 2011 as the year the market began to move off the bottom, the focus now turns to how fast will we get "back to where we were?" With the extent of the market decline and the economy's slow growth most of the real estate industry is cautious in predicting a return to peak levels. Over time, values will return to and even exceed peak levels and they will do so faster than expected (just as we fell faster than expected). What we are seeing day-to-day "on the ground" is strong pent-up buyer demand for residential real estate and buyers willing to pay more than the asking price (albeit at prices 40% off peak). This activity is not being reflected in the national statistics since they tend to be four to eight months behind current market activity.
This Home Value Index Trend Chart shows our current forecast of home values for Southeast Michigan. It is based on a steadily improving economy and uses a combination of historical appreciation rates and an estimate of the decline in foreclosed properties.
We have moved from a peak valuation point in 2005 to the bottom point in early 2011. It has taken a little over five years to hit the bottom of the market and it should take about the same amount of time to recover as well. Interest rates are the biggest wild card in a steady recovery. With property values at a low-point, there is room in the market for higher rates without hurting demand. However, if rates rise dramatically, three to four years from now when values have recovered, to a degree, this could result in another market set back extending the "back to peak" point a few years. The main point of this exercise is to show that "peak" values are a few years away, so if a seller is waiting for their 2005 values, they should plan on a few years wait time, not months. But, keep in mind, all boats rise in a recovery, so as a seller waits for their value to rise, the property they want to purchase will also rise, but in the future, at higher interest rates and payments!
Finally, the banks are expected to increase their inventory release rate, which will have some impact on appreciation rates this year. However, a large share of those properties are in poor condition and will therefore tend to draw investors and bulk buyers, with less impact on the typical single family property sale. Overall, it cannot be said enough that 2012 and probably 2013, will still be in that perfect balance of an improving seller's market as well as a great buyer's market.
If you'd like more information on the market, like to list your property, or want information on any property from any broker, you may call or email at anytime.
Thank you,
Conne Terova
Realtors That Make It Happen For You!
P: 248-318-7342
cterova@yahoo.com
http://www.teamterova.com
Conne Terova
Conne Terova
248-318-7342
Visit my website
Facebook LinkedIn
Michigan Monthly Market Update - December 2011
December showed a bounce back in buyer activity from a slight slowdown in September through the first half of November. Pending sales were up along with showings and website activity.
With 2011 as the year the market began to move off the bottom, the focus now turns to how fast will we get "back to where we were?" With the extent of the market decline and the economy's slow growth most of the real estate industry is cautious in predicting a return to peak levels. Over time, values will return to and even exceed peak levels and they will do so faster than expected (just as we fell faster than expected). What we are seeing day-to-day "on the ground" is strong pent-up buyer demand for residential real estate and buyers willing to pay more than the asking price (albeit at prices 40% off peak). This activity is not being reflected in the national statistics since they tend to be four to eight months behind current market activity.
This Home Value Index Trend Chart shows our current forecast of home values for Southeast Michigan. It is based on a steadily improving economy and uses a combination of historical appreciation rates and an estimate of the decline in foreclosed properties.
We have moved from a peak valuation point in 2005 to the bottom point in early 2011. It has taken a little over five years to hit the bottom of the market and it should take about the same amount of time to recover as well. Interest rates are the biggest wild card in a steady recovery. With property values at a low-point, there is room in the market for higher rates without hurting demand. However, if rates rise dramatically, three to four years from now when values have recovered, to a degree, this could result in another market set back extending the "back to peak" point a few years. The main point of this exercise is to show that "peak" values are a few years away, so if a seller is waiting for their 2005 values, they should plan on a few years wait time, not months. But, keep in mind, all boats rise in a recovery, so as a seller waits for their value to rise, the property they want to purchase will also rise, but in the future, at higher interest rates and payments!
Finally, the banks are expected to increase their inventory release rate, which will have some impact on appreciation rates this year. However, a large share of those properties are in poor condition and will therefore tend to draw investors and bulk buyers, with less impact on the typical single family property sale. Overall, it cannot be said enough that 2012 and probably 2013, will still be in that perfect balance of an improving seller's market as well as a great buyer's market.
If you'd like more information on the market, like to list your property, or want information on any property from any broker, you may call or email at anytime.
Thank you,
Conne Terova
Realtors That Make It Happen For You!
P: 248-318-7342
cterova@yahoo.com
http://www.teamterova.com
Wednesday, December 7, 2011
October 2011 Market Report
Michigan Monthly Market Update - October 2011
So far this year we have had a classic economic struggle of Good vs. Evil.
The Good Side
* Values are stable to rising (even Case-Shiller shows metro Detroit values are up!)
* We are creating jobs in Michigan
* Consumer Confidence moved up a bit
* Strong pent up buyer and seller demand
* Record low combination of prices and interest rates
The Evil Side
* Lack of saleable home inventories
* Larger percentage of homes with little to no equity
* Slow job growth
* Stock market volatility
To date, good has won out over evil, but the market did pause a bit in the last 45 days, with the pace of buyer demand sliding (but still ahead of last year at this time). There are a couple of potential causes. The stock market/European "noise" has been distracting (3rd quarter 401K statements came out in Oct, which may have scared some), but the main cause may be that we simply do not have enough saleable homes. If you don't have enough logs for the fire, it will eventually die down.
We could be in for a strange stair-step real estate recovery cycle: sales rise, depleting inventories, then fall from fewer homes to sell which causes values to rise (fewer listings = feeding frenzy), which brings more homes back into the market (more sellers can now sell), and the cycle starts over again. It is a scenario that occurs with every recovery but exaggerated today because lower home equity levels are keeping a lid on inventories.
Price per square foot has continued to rise compared to last year, with available homes for sale up slightly as well (mainly over $250,000). The available home levels feel lower, because it has actually fallen over the past 90 days (as it did last year as well). The seasonal shifts make it difficult to judge the true market momentum without comparing to the same time last year. Pending home sales are at a faster pace than last year as well, causing the Months Supply of Inventory to decrease over the past 90 days, which is putting positive pressure on values.
Our best leading market indicators are open house visitors, website visits, and the number of showings on our listings. As you can see from the Percentage Monthly Change - 2011 vs 2010 chart, compared to the same time last year, all three have positive trends, with the showing count giving some mixed signals (confirming the October slowing).
In summary, this is a great time to put your house on the market if you have been thinking about it. The right priced homes are seeing multiple offers and selling quickly. If you'd like more information on the market, like to list your property, or want information on any property from any broker, you may call or email at anytime.
Thank you, Conne Terova and Brenda Banwell
So far this year we have had a classic economic struggle of Good vs. Evil.
The Good Side
* Values are stable to rising (even Case-Shiller shows metro Detroit values are up!)
* We are creating jobs in Michigan
* Consumer Confidence moved up a bit
* Strong pent up buyer and seller demand
* Record low combination of prices and interest rates
The Evil Side
* Lack of saleable home inventories
* Larger percentage of homes with little to no equity
* Slow job growth
* Stock market volatility
To date, good has won out over evil, but the market did pause a bit in the last 45 days, with the pace of buyer demand sliding (but still ahead of last year at this time). There are a couple of potential causes. The stock market/European "noise" has been distracting (3rd quarter 401K statements came out in Oct, which may have scared some), but the main cause may be that we simply do not have enough saleable homes. If you don't have enough logs for the fire, it will eventually die down.
We could be in for a strange stair-step real estate recovery cycle: sales rise, depleting inventories, then fall from fewer homes to sell which causes values to rise (fewer listings = feeding frenzy), which brings more homes back into the market (more sellers can now sell), and the cycle starts over again. It is a scenario that occurs with every recovery but exaggerated today because lower home equity levels are keeping a lid on inventories.
Price per square foot has continued to rise compared to last year, with available homes for sale up slightly as well (mainly over $250,000). The available home levels feel lower, because it has actually fallen over the past 90 days (as it did last year as well). The seasonal shifts make it difficult to judge the true market momentum without comparing to the same time last year. Pending home sales are at a faster pace than last year as well, causing the Months Supply of Inventory to decrease over the past 90 days, which is putting positive pressure on values.
Our best leading market indicators are open house visitors, website visits, and the number of showings on our listings. As you can see from the Percentage Monthly Change - 2011 vs 2010 chart, compared to the same time last year, all three have positive trends, with the showing count giving some mixed signals (confirming the October slowing).
In summary, this is a great time to put your house on the market if you have been thinking about it. The right priced homes are seeing multiple offers and selling quickly. If you'd like more information on the market, like to list your property, or want information on any property from any broker, you may call or email at anytime.
Thank you, Conne Terova and Brenda Banwell
Thursday, June 23, 2011
MARKET UPDATE
It has been quite a while since the statement "things are remaining the same" was a good sign, but for metro real estate it is. Available home inventories continue to decline and the rate of sales are holding near the same annualized pace as last year, with the average price per square foot on the rise. There certainly is a chance of a double dip market decline, but with the current buyer activity levels and reduced inventories, that does not appear likely.
Saleable listings and discounted bank owned are getting multiple offers and selling quickly. With so much activity focused on those segments, the best opportunities for bargains are the homes that have been sitting on the market. Many are actually priced within their saleable range, but in outdated or poor condition. Using FHA 203K loans, a buyer can find a diamond in the rough, get a loan to cover the repairs and get a home at a great price.
For buyers, with the most popular homes selling in days, it is important to understand the rules of the road when working with competing offers.
- Be ready to move quickly
- Be pre-approved for your mortgage
- It is now officially OK to offer above asking price for the right home
- Be ready to bridge the gap between your agreed upon price and the appraised value (because the next guy will if you don't)
Below, please find the latest May’s Market Update for your review. If you have any questions or need any real estate advice, feel free to contact me.
Also, feel free to pass this update on to anyone that may be interested.
Conne
Conne Terova
Team Terova
248-318-7342
www.teamterova.com
May, 2011
$0 to $100,000 Home Values Past 90 Day Trends | ||||||||||||
#of Homes Pending | Homes for Sale | Ave Price/sqft. | ||||||||||
Area | May 11 | Trend | May 11 | Trend | May 11 | Trend | ||||||
Oakland County | 982 | é | 3,113 | ê | 41 | é | ||||||
Macomb County | 507 | çè | 2,025 | ê | 34 | é | ||||||
Livingston County | 81 | é | 299 | ê | 51 | é | ||||||
Washtenaw County | 86 | é | 258 | ê | 43 | é | ||||||
Wayne County ( - Detroit & G.P.) | 780 | é | 2,268 | ê | 38 | é | ||||||
Detroit* | 721 | çè | 5,364 | ê | 10 | çè | ||||||
Grosse Pointe(s)** | 96 | ê | 439 | ê | 20 | ê | ||||||
Northwest Michigan*** | 67 | çè | 3,964 | ê | 47 | çè | ||||||
Total | 3,320 | é | 17,730 | ê | 32 | é | ||||||
Median Sale Price | Months Supply Inv | |||||||||||
Area | May 11 | Trend | May 11 | Trend | ||||||||
Oakland County | $49,000 | é | 3.2 | ê | ||||||||
Macomb County | $35,022 | çè | 4.0 | ê | ||||||||
Livingston County | $71,450 | é | 3.7 | çè | ||||||||
Washtenaw County | $59,950 | é | 3.0 | ê | ||||||||
Wayne County ( - Detroit & G.P.) | $41,200 | é | 2.9 | ê | ||||||||
Detroit* | $8,500 | çè | 7.4 | é | ||||||||
Grosse Pointe(s)** | $19,950 | ê | 4.6 | çè | ||||||||
Northwest Michigan*** | $55,000 | çè | 59.2 | çè | ||||||||
Total | $36,350 | é | 5.3 | ê | ||||||||
Over $100,000 in Home Values Past 90 Day Trends | ||||||
#of Homes Pending | Homes for Sale | Ave Price/sqft. | ||||
Area | May 11 | Trend | May 11 | Trend | May 11 | Trend |
Oakland County | 1,203 | é | 6,189 | çè | 106 | é |
Macomb County | 261 | çè | 1,768 | ê | 82 | çè |
Livingston County | 213 | çè | 1,473 | çè | 97 | é |
Washtenaw County | 279 | é | 1,264 | ê | 123 | çè |
Wayne County ( - Detroit & G.P.) | 471 | é | 1,878 | ê | 101 | é |
Detroit* | 721 | çè | 283 | ê | 44 | ê |
Grosse Pointe(s)** | 30 | ê | 329 | çè | 107 | é |
Northwest Michigan*** | 96 | ê | 4,042 | çè | 122 | é |
Total | 3,274 | é | 17,226 | çè | 91 | é |
Over $100,000 in Home Values Past 90 Day Trends
Median Sale Price | Months Supply Inv | |||
Area | May 11 | Trend | May 11 | Trend |
Oakland County | $192,500 | çè | 5.1 | ê |
Macomb County | $146,000 | çè | 6.8 | é |
Livingston County | $175,000 | çè | 6.9 | ê |
Washtenaw County | $197,500 | çè | 4.5 | ê |
Wayne County ( - Detroit & G.P.) | $193,000 | é | 4.0 | ê |
Detroit* | $120,500 | ê | 16.6 | ê |
Grosse Pointe(s)** | $215,000 | ê | 11.0 | é |
Northwest Michigan*** | $187,000 | é | 42.1 | é |
Total | $172,341 | çè | 8.8 | ê |
Source: MIRS, Realcomp, AABOR, TAAR
Months Supply Inventory is the current rate of sales to sell existing home inventory
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