"How's The Market?" / Market Metrics by Marlys
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Dear Marlys, First and foremost – HAPPY VALENTINE’S DAY!! So………..”HOW’S THE MARKET – 2012? Well, the quick and easy answer is that properties are selling. All signs point to a slow and steady recovery. Single family home sales are up 22% from the lows of 2008. Days on the market have decreased, while prices and interest rates are down. PHEW - That was quite a mouthful!!! Now let’s break it down a bit more…. By all indications, 2012 is looking good for real estate. Throughout 2011, pending home sales stayed above 2010 levels and, according to a recent report by the National Association of Realtors (NAR), sales of existing homes rose for the third straight month in December, providing encouraging news as we enter 2012. “Housing affordability conditions are too good to pass up,” Lawrence Yun, NAR’s chief economist said. “Our hope is lending conditions will gradually improve with sustained increases in closed existing-home sales.” So, let's examine the sustainability of our current affordability index. Finance Corner by Chris Davis and Linda Munoz, Private Mortgage Advisors, APR Mortgage Bonds are sharply lower on a far better than expected Jobs Report. Let's break it down. The headline Jobs Report showed 243,000 jobs created, which was much better than expected. Meanwhile, a whopping 257,000 private jobs were created, also much higher than expected. Upward revisions to November and December added another 60,000 jobs to what was previously reported for those months. And adding to the euphoria was a 0.2% decline in the Unemployment Rate, bringing it to 8.3%...the lowest since February 2009. Despite all this good news, the report did show a pretty sharp decline in the labor participation rate from 64% to 63.7%. We really need to have more people "participating," or working to help pay down our debt. Understandably, the demographics of baby boomers retiring does account for some of the decline. But is it the entire 0.3%? And the U-6 Unemployment Rate (which counts all persons marginally attached to the labor force, including those who are employed part-time but would prefer full-time) remains at a lofty 15.1%, with that figure dropping just 0.1% for the month. And there was other good news to note last week as well: The Commerce Department reported that Personal Incomes rose in December by 0.5%, above expectations and well above the 0.1% reported in November. This marked the largest increase in nine months! So what does all of this mean for thehousing market and home loan rates? While Bonds and home loan rates did worsen on the good Jobs Report news (remember good economic news often causes money to flow out of Bonds and into Stocks, as investor try to take advantage of gains), home loan rates remain near historic best levels. In addition, the problems in Europe remain…and as uncertainty reemerges, US Bonds (including Mortgage Bonds, to which home loan rates are tied) will benefit. Marin County Market Update The following chart demonstrates the long-term stability of Marin County home prices despite 46 years of widely fluctuating markets.
From 1966 - 2007, this chart demonstrated nearly unbelieveable price stability, during even the longest and deepest recessions - until 2008. The recent recession, coupled with a number of economic and political factors, including the well-publicized collapse of many of the world's financial institutions, created an environment in which (for the first time since the existance of this database) prices plunged. The good news is that prices started to firm up in 2010. In 2011 they disappointingly dropped back down to 2009 levels. However, this give-and-take within relatively narrow parameters would appear to demonstrate a market attempting to correct itself. January statistics give us reason for optimism as we enter 2012: After a brief dip in December, new sales picked right up in January with 237 pending sales - 21% more sales than January 2011. It would appear that the strong buyer demand we experienced last year has carried over in to the new year. Unfortunately, so has the low inventory. Based on the number of homes currently on the market and the rate of sale, this chart indicates that we would be completely out of homes to sell within 2.3 months. This index is 49% lower than last January and about half as long as most economists consider "healthy." This chart demonstrates the temporary benefit to sellers of this supply/demand imbalance. The pending rate for Marin overall was 42.9 in January, 54% higher than at this time last year. This number means that of all of the homes available for sale during the month of January, 42.9% of them received acceptable offers and went into escrow! That is extremely high historically and benefits sellers by attracting more offers while placing upward pressure on price. As a reslult, more properties are receiving multiple offers, a scenario which almost always results in the hightest price and best terms possible. We have literally turned the corner when it comes to new sales and new listings. After the anticipated holiday lull, the number of new listings taken in January represented a 108% increase over December. However, this still represented 19% fewer listings than we took in January 2011. New sales increased 47% over December, and 26% over January 2011. Until the number of new listings overtakes the new sales for a period of time, we will be in this temporary seller's market. Wise sellers are taking advantage of this "window of opportunity" by getting their homes prepared and on the market before inventory catches up to demand. How long will this window remain open? Great question. It will depend on two factors of course: 1. Demand: will the current affordability factors remain in place? It would appear that the Fed will keep interest rates low for another year or two. As long as the employment picture shows even slight improvement and there are no further financial "surprises" demand could remain at high levels for the foreseeable future. 2. Supply: This is up to sellers. Their willingness to sell depends on many factors, personal and financial. Sellers who need or desire to sell in the next year two must determine the most beneficial time to place their home on the market. Each town, each neighborhood, each home is unique. A general statement about the time to buy is just not appropriate. That is why I analyze each home individually before I recommend a time and stategy for selling. If I can help with any of your real estate decisions, please give me a call. I work primarily through referrals. If you know of anyone you feel could use my services, please give me a call. I'm always here for you. JUST ASK Q: Can you help me with real estate in other areas of the state or country? A: Absolutely. I work closely with agents from all over. It does not have to be local or just in our state. The benefit of working with a referral agent is you’ll receive more personal service and attention since they’re accountable not only to you, but to me as well. What’s more, you can call me at any time. I am your advocate. I will intercede for you. For moving, remember that our company has a list of preferred service providers, including cleaning services and movers. I have my favorites too. If you know anyone who is thinking of relocating, please feel free to give me a call. Once again, I am YOUR Gal, for any and all of your Real Estate needs! FIRST IMPRESSIONS COUNT As buyers drive around the neighborhood, does your home stand out from the rest? Here are some ideas for setting the stage for your home.Install a border along your driveway. Edging materials such as bricks, pavers and stone bring asphalt slabs to life and imply a higher level of detail. Quality counts. Install lights along the sidewalk and path that leads to your entryway. Solar lights don’t require running electrical cable and are easy to install and most have a run time of at least six hours. Do you have trees in front of your house? If so, cover updead spotsthat appear near their roots. By adding two inches of mulch, your entire yard will look healthier. Bigger projects that have a good payback include a new garage door, new hardware and paint on the front door, and a new mailbox. First impressions can sell your home. Let me know if you want me to come over and give you my thoughts. PERSONAL UPDATE That is an update for the moment. There is always lots and lots more information available on my website: www.MarlysHooper.com. Feel free to click on at any time and puruse the varioius links that I have made available for you. If you are considering buying a new home, or selling the home you have, now may be the perfect time! Just know that as always, if there is anything that you might need that is real estate related, know that I am "Your Gal" and here to help. Please call @ 717.8200 :-) | ||||||
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