Black Friday Influences on Real Estate Market

Black Friday has become an entire weekend of savings for many of the holiday season’s big-ticket items. However, do these savings apply to one of the most expensive items an individual can invest in—a house? According to an article recently completed by Forbes, the fact that the holidays are not traditionally thought of as the time to move can work in a buyer’s advantage. Many wish to simply be with their families, partying and celebrating the close of one year and the start of another. As a result, those who are willing to sacrifice a bit of this celebration and search for homes and attend open houses may find that they score a better deal.

Fundamentally, the holidays are an excellent time to be a buyer; sellers tend to be very aggressive when offering holiday deals, as a means of enticing buyers. James Dainard, a Seattle-area broker with Heaton Dainard Real Estate, says he typically sees a drop in prices between three thousand dollars and twelve thousand dollars. Tracey Hicks, a broker in Portland, Oregon, with Dwell Realty, saw a cut in prices between Thanksgiving and New Years of last year; houses were priced approximately five percent under market value during the festive time of year.

In addition to this, Dainard claims that he often sees an opportunity for steals and deals throughout the holiday season. Often, sellers will throw in additional items in the deal to fulfill the spirit of generosity throughout the holiday season; such items can include energy-efficient washers, dryers, stoves, full sets of living room furniture, and big-screen plasma televisions.

From a seller’s point of view, individuals must proceed with caution. The spirit of the holidays can take hold and encourage offers that shouldn’t be made or that are in conflict with the terms created by the mortgage broker; broker’s create specific lending guidelines and offering some items or wording things incorrectly in a contract can delay the closing date or ruin the transaction altogether. Check with brokers to insure that all added items and changes in price are within the terms of the contract to avoid any delays.

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American Housing Prices Over and Under Valued

A recent study was conducted by real estate website Trulia to analyze home prices in one hundred metro areas relative to fundamentals such as jobs, income growth and household formation and rents, according to an article completed by Market Watch. Over the one hundred largest metro areas in the nation, housing prices varied dramatically. In general, though, the study found that the housing market is slowly edging its way back from the price crash that followed the peak of the housing bubble, which occurred in the first quarter of 2006. At that time, prices on homes in the United States were generally overvalued by approximately thirty four percent.

Despite the fact that things seem to be edging their way back to normality, there is still great variation in prices across the country. Of the top one hundred metro areas in the country, there were several that were highly overvalued. Housing prices in Austin, Texas were found to be overvalued by nineteen percent; this figure earned the city the title of most overvalued market in the United States. Specifically, the median prices of homes in Austin jumped eleven percent year-over-year in August, to come to a resting price of two hundred and forty seven thousand five hundred dollars. The average price of homes in Austin also increased, growing nine percent to three hundred and eleven thousand four hundred and fourteen dollars. Quickly following Austin were Los Angeles and Orange County, which both fell to fifteen percent. San Francisco’s homes were found to be overvalued by twelve percent; Riverside-San Bernardino was just behind San Francisco, overvalued at eleven percent. In general, seven of the top one hundred metro areas in the nation were overvalued by more than ten percent.

Alternatively, undervalued markets tended to fall in either the Midwest or New England like Farifield County, Connecticut. Dayton, Ohio was undervalued by twenty one percent. Shortly following this was Cleveland, which fell to be undervalued by nineteen percent. Finally, Detroit was undervalued at eighteen percent.

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Real Estate Listings Increase in St. Cloud, Minnesota

In the St. Cloud area, real estate statistics are reported via the St. Cloud Area Association of Realtors. The recent release of the latest findings for August prompted an article by the SC Times which specified the most prosperous areas of the St. Cloud region. Overall, new residential real estate listings increased just shy of eleven and a quarter percent during the month of August. During August alone, two hundred and eight new listings were provided in the area, bringing the year to date new listings percentage to just over nine percent. Large portions of these new listings were in Sartell. The town has seen three hundred and seventy one new listings over the course of this year; this figure is up approximately twenty five percent from the roughly the same date in 2013.

Sales prices were also on the increase in August. The average sales price for the month was up nearly thirteen and a quarter percent, coming to rest at one hundred and eighty three thousand, eight hundred and twenty five dollars. Year to date thus far for 2014, the average sale price is up ten percent to one hundred and sixty eight thousand, three hundred and seventy five dollars. Finally, the median sales price in August was settled at one hundred and fifty nine thousand dollars; this figure is the highest for any month since the summer of 2008.

The number of closed sales continued to grow as well. For the third consecutive month for the St. Cloud area, closed sales numbers increased, continuing to rest at a higher number than the area has seen since the summer of 2007. In August, the area saw one hundred and sixty six closed sales; this is on top of a very successful July and June. In June, one hundred and sixty nine sales were closed; in July, the same figure fell only to one hundred and sixty eight. Specifically, to Sartell, the number of closed sales increased almost thirty percent; in total thus far in 2014, two hundred and thirty nine homes have been closed, through the first eight months of the year alone.

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Home Prices Slowly on the Rise

According to an article recently completed by CNN Money, a report released by S&P and Case-Shiller on the national home price index shows that the prices of homes is increasing, but slowly.  The report surveyed two separate home price indexes, and found two different facts to be true.  Prices rose at a slower year-over-year pace in June alone, with nearly every city reporting lower gains.  In both city indexes, prices increased by just over eight percent on an annual basis.  All of these statistics are a first in the market over the course of the last six years.

Despite the relatively solid message sent by these figures, the article acknowledges that the recent housing market data has sent mixed messages.  The number of new homes sold dropped in July, for the third straight month in a row.  However, alternatively, existing home sales in the same month increased to annual rate to over five million units; this figure is the highest seen in the market since 2014.  Likewise, starts in housing projects, building and sentiment towards the market have also all been positive.  According to David Blitzer, a spokesman for S&P, together all of these factors indicate a normal housing sector.  Despite this, the prices continue to rise.

Specifically, the report found several cities to be successful or lacking in their gains from the housing market.  Las Vegas recorded the largest year-over-year increase of any city housing market in June, with over fifteen percent gains.  In addition to Las Vegas, San Francisco, Miami and San Diego also reported strong gains.  Alternatively, Cleveland prices were very nearly flat, whereas in the larger index, actual increases were experienced in Charlotte, North Carolina, New York and Washington.

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Online Real Estate Giants Zillow and Trulia Combine

Zillow and Trulia changed the real estate market for buyers, in a way that had never been experienced previously.  The sites presented another means of shopping for a home; they allowed for a separation from the traditional word of mouth and reliance on real estate agents.  Zillow had a unique function, which it entitled its Zestimate; it served as a housing price estimate for over one hundred million homes nationwide.  This figure was configured from several pieces of data—geographic location, user-submitted information and data pulled from public records.  From there, it put the power in the hands of the buyer, allowing the user to estimate whether the house they were interested in was within their price range.

Zillow and Trulia had their common ground as well.  Both sites offered similar background information on perspective communities.  The name and data associated with the neighborhood school was provided, in addition to crime reports and mortgage calculators.  Both sites also earned their revenue through similar means; Zillow and Trulia relied on advertising and subscription software and services sold to real estate agents to earn their profits.  Through these profits, Zillow and Trulia have earned their spots as the top two competitors in the online real estate market.  Zillow has the edge, with a reported eighty three million monthly unique visitors; Trulia falls to second, with a still impressive fifty four million unique visitors per month.

Their similarities are far more numbered than their differences.  Therefore, it was unsurprising when an article recently completed by the Miami Heraldannounced the two have struck a deal to combine their companies.  Zillow is buying Trulia for three and a half billion dollars.  Trulia shareholders will receive .444 shares of Zillow common stock for every one share they currently hold; as a result, Trulia shareholders will own approximately thirty three percent of the company.  Zillow shareholders will receive one comparable share of the combined company stock and will, therefore, own the other sixty seven percent of the new company.  Both brands will be kept and, together, Zillow and Trulia will create the biggest player in the real estate information market.

Both Boards for the two separate companies have approved the deal; shareholders still need to approve, but it is believed that will come to a positive close by the end of the next year.  When the companies do combine, Pete Flint, the CEO of Trulia, will continue to hold his position, but will report to Spencer Ruscoff, the CEO of Zillow.

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Housing Market Improving, But Not There Yet

Karl ‘Chip’ Case is a well-known economist and co-creator of the much-watched S&P/Case-Shiller home price indexes. His experience in the housing market if revered and his advice is rarely held as anything less than the epitome of accuracy.  According to an article recently completed by CNN Money, Case claims that the housing market is improving, but that it still has quite a bit of ground to make up from the Great Recession.

The key component to watch, as an indicator on the current and future success of the housing market, is the number of house starts.  Housing starts is the measure of new residential home construction projects.  Typically, even in the worst of economic conditions, the number of house starts hovers above one million; in thriving economies, this number can reach or even exceed two million.  However, in 2009, in the heat of the Great Recession, this figure fell to five hundred thousand and remained there for several months.  Since then, the recovery has been a slow one, with the number only climbing its way back over one million in April of 2014.

For Case, this does not scream a permanent and true turn around.  The test will be if there is a continued demand that allows the number of housing starts to stay over the threshold of one million.  Case hopes that a surge in Millennials entering the housing market over the next few years could help preserve this demand.  In addition, he hopes that rich foreign buyers entering the American market in an attempt to secure a safe investment for their wealth may also assist in preserving this reestablishment of a healthy housing start statistic.

Case applies this figure to implications for first time buyers to deliver advice for those entering the market for the first time.  He cautions against buying a house that is unaffordable at the current level of salary; in addition, a quick profit should not be expected in the way of the current market.  If the investment is not intended to be a long-term purchase, Case claims the home shouldn’t be purchased at all; those looking to simply turn over the property could find themselves waiting through long cycles of down market time.

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Frank Jermusek: Northco Real Estate | The Valley Golf Course

Enjoy this beautiful 120 acre golf course with fourteen Residential Lots
This course in Near Eau Claire, Wisconsin just minutes from the city of Mondovi, was opened in 1962 with 9 holes and was expanded to 18 holes in 1998.

The course includes cart paths six feet wide for easy use, with paving for all high traffic areas,
a practice green, and is a Par 72 course with 6,420 yards.

Please contact Frank Jermusek for more information.

Important Factors in Choosing Your New Home

Whether you are a first time homeowner or you’re in the market to buy your second or third home, finding a house that is right for you is not a simple task. Some buyers take months or years to decide with house is right for them and their families. It may take even longer to find one that is within their budget. According to a recent Forbes article, there are 10 factors to determine if the current home you are looking at is the right one for you.

Think Beyond Square Ft.

If you’re thinking about side, you should really avoid basing your decision on the square footage of the house. Square feet may seem like a valid basis of comparison for people, but it is important to take into account other characteristics of a house that could determine the list price.

Don’t Look For Perfection

In looking for a house, you shouldn’t expect perfection. Nothing is perfect. Setting the bar to unreachable expectations will only lead to disappointment. Instead of expecting to find a perfect home take note of changes you would make to the home you were interested in and brainstorm ways you could make that house closer to your perfect home- such as small changes to the interior/exterior.

Consider the Current Floor Plan

Think about the floor plan of the house rather than its finishes. A home with a kitchen, living room and bedrooms the size you want is much more important than the finishes on the countertops and faucets in the house. The finishes can be changed later for a smaller price point than for knocking down walls or expanding rooms in order to manipulate space.

Availability

You might want to look through homes that are on the market. On the other hand, if you see something you really love, you may want to inquire about it, or wait for it to go on the market. If you don’t see anything you think is right or that stands out to you, hold off for more houses to come on the market. If that doesn’t happen in a right time span for you, you can either expand your searches or adjust your expectations.

Cost

For many people a house is not just a roof over their head, but a home where memories are made. Choosing a house purely based on how much it costs is not the best choice unless it provides you with everything you want and need in a home. Strike a balance with budget, and remember there are always special financing options.

Neighborhood

Next is choosing not only the house but the neighborhood. The neighborhood encompasses the home and you would want to make sure the surroundings were comfortable for you and your family- this could provide a positive social atmosphere for them. You can also think about the “feel” of the house itself, and whether or not you can really see yourself being comfortable and at home.

In addition, there are a few final aspects you should consider in buying your home. Consider the additional costs to your home such as new furniture, and also know what aspects of a home are non-negotiable for you and your family. If you consider all of these things listed, you and your family will be on the right track to owning the home that is right for you.

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