Keepin’ it REAL Estate

I can’t believe that 2007 has gone by so fast!  I hope that everyone enjoyed their respective holiday’s.  Now its back to the daily grind, where my posts will resume daily (federal holiday’s excluded )

Being that it is the last day of the year, I thought a view of what happened with the Cincinnati Real Estate Market would be appropriate.  Let the Statistics Begin!

The following stats cover these Cincinnati areas: Hamilton, Butler and Warren Counties.

Sold: 1/1/06- 12/31/07

As you can see as far as residential home sales in Cincinnati, we are only slightly down from last years sales, in terms of units sold (about 13%).  Our average home price fell only about 2% from 184,170 to 180,711 and our days on market rose from 72 days to 80 days.  This is not nearly the gloom and doom picture our media has been giving us all year.

Lets take a look at the over all numbers (residential, land, commercial and multi-family sales)

Once again our units sold is down by about 13% and our total dollar volume down by about 14% and our days on market only rose about 1.5%

Living in Cincinnati is good! We haven’t experienced as dramatic of a dip as other parts of the country and we should continue to see things level out.

Wednesday I will report on some of our 2008 real estate predictions.

Happy 2008!  If I had a chance to serve you this past year, thank you for your business!  For those of you I have not had a chance to work with, I hope to do so in 2008.

Sibcy Cline had the opportunity to be apart of over 6200 transactions this year making up almost 20% of the total real estate volume, almost double that of our competition.

Many people ask me why did you choose Sibcy Cline?  Simply put, they’re the best and why wouldn’t I want to work for them?

Feel free to contact me if you would like help listing or selling a home.

Blessings -

Wishing everyone a Merry Christmas and Happy New Year!  I’m off for the rest of the week….

May everyone have a blessed and safe holiday.

According to the chief economist of the National Association of Realtors, Lawrence Yun;  The challenges of the current housing market should give way to a year of opportunity in 2008.  “All real estate is local and there are some robust local markets, some recovering local markets and some under-priced local markets.  We’ll have a favorable economic backdrop (in 200 which should unleash pent up housing demand.”

Although we are currently seeing declining home prices, according to Yen, when it is all said and done 2007 will still be the fifth best year on record.

So what are Yen’s predictions for 2008?

Yen predicts and upswing in the market place:

• Existing home sales will increase to 5.69 million (from 5.67 in 2007)
• New home sales of 690,000 units (compared to 800,000 this year
• 30yr fixed rate mortgages of 6.5% (vs the 6.4%avg in 2007)
• Existing home prices will remain unchanged in 2008 following a 1.7% drop this year

This is good news for everyone.  The most asked question I get is how is the market????  Things are slow and steady.  People are still buying homes and will continue to buy homes.  I think they and the lenders are just more cautious…

2008 will be a great year - no doubt about it!

At the end of the month I’ll give an area yearly wrap up so that we can see how we did this year, compared to last.

Federal Reserve chairman Ben Bernake said today that the central bank was proposing new rules to clean up mortgage lending and also aimed at protecting home buyers from potential mortgage fraud. 

“We are meeting today to discuss proposed regulatory amendments to protect consumers from fraud, deception and unfairness in the mortgage market,” Bernake said in a statement.

The proposal includes four key protections for “higher-priced mortgage loans” secured by a consumer’s principal dwelling:

• Creditors would be prohibited from engaging in a pattern or practice of extending credit without considering borrowers’ ability to repay the loan.
• Creditors would be required to verify the income and assets they rely upon in making a loan.
• Prepayment penalties would only be permitted if certain conditions are met, including the condition that no penalty will apply for at least sixty days before any possible payment increase.
• Creditors would have to establish escrow accounts for taxes and insurance.

The rule would define “higher-priced mortgage loan” to capture loans in the subprime market but generally exclude loans in the prime market. A loan would be covered if it is a first-lien mortgage and has an annual percentage rate (APR) that is three percentage points or more above the yield on comparable Treasury notes, or if it is a subordinate-lien mortgage with an APR exceeding the comparable Treasury rate by five points or more.

The following protections would apply to all loans secured by a consumer’s principal dwelling, regardless of the loan’s APR:

• Lenders would be prohibited from compensating mortgage brokers by making payments known as “yield-spread premiums” unless the broker previously entered into a written agreement with the consumer disclosing the broker’s total compensation and other facts. A yield spread premium is the fee paid by a lender to a broker for higher-rate loans. The consumer’s written agreement with the broker must occur before the consumer applies for the loan or pays any fees.
• Creditors and mortgage brokers would be prohibited from coercing a real estate appraiser to misstate a home’s value.
• Companies that service mortgage loans would be prohibited from engaging in certain practices. For example, servicers would be required to credit consumers’ loan payments as of the date of receipt and would have to provide a schedule of fees to a consumer upon request.

The proposed revisions to TILA’s advertising rules require additional information about rates, monthly payments, and other loan features. The amendments also would ban seven deceptive or misleading advertising practices, including representing that a rate or payment is “fixed” when it can change.

The government is stepping in and trying to prevent another “mortgage crisis” from happening again in the future.  And in all honesty they should try to stop predatory lending practices and stop those from trying to buy homes they cannot afford.

Is this a symbol for how bad consumerism has gotten in America?  Are we suffering from “keeping up with the Jones’ syndrome?” 

As far as immediate effects this will have on our market, probably none.  I think everyone right now is sitting tight and waiting to see what will happen in the spring time.

Lets drink our eggnog and open up some presents these next few weeks and forget about our housing woes…

I was Christmas shopping this weekend and as I was driving past what once was Parisian and now a big hole in the ground, I thought to myself “Will Nordstrums do any better?”  Having grown up in Cincinnati, Kenwood was always our shopping area of choice.  In fact, I remember shopping at McAlpins with my mom many christmas’s ago…  While waiting in the holiday traffic, it got me thinking about other building projects that are going on in the area.  To the north of the large hole, is rising Kenwood Towne Place, a $180 million retail and office development by Bear Creek Capital that will house the region’s first Crate & Barrel.  Once rumored to be coming to Rookwood, until the nasty eminent domain suit hit… and now the land is just sitting there, wasting away.  Aross Montgomery Road at Sycamore Plaza, construction is almost complete on the 27,000-square-foot Jared Jewelers. The store is part of a $2 million makeover of the plaza, which has added more than 50,000 square feet of new restaurants and retailers in the past three years, including The Fresh Market, IHOP and Macaroni Grille.

It looks like Kenwood has the right idea.  It has stepped up to the plate with regards to becoming the “new Rookwood”.  Only time will tell.

I want to know if they’re going to put a new movie theater up now? 

Although we haven’t seen the snow (yet) and the temperatures feel more like spring than December, the holiday season is definitely here.  Evidence of the hustle and bustle of shoppers is everywhere and so are the holiday lights!  Some are grandiose and other not so much.  I love just driving around at night looking at the lengths people will go to to put up holiday decorations.  Below are some photos taken while showing property.  The people next door are trying to sell their home….  Do you think some buyers may be turned off by the blinding lights from next door?

Don’t get me wrong. I love it and I really do admire the time, effort and energy these people put into decorating their home.  I just hope they’re not inadvertently scaring off some new neighbors in the process.

So that brings us to the question.  Should you list your home around the holidays?  I say yes! 

1. This is the one time of year that you home is probably the “homiest” it will ever be.  It will be warm, inviting and decorated all probably enhancing the “warm fuzzy feelings” buyers want when they purchase a new home.

2.  Less competition.  I’ve said this before.  Most people will wait until spring to put their house up.  So if you want to be one of a few then do it now!

3.  Many people are home for the holidays and have time off.  These are the days that they actually go around and “shop” for new homes.

If you don’t want to wait until spring, send me an email and I’d love to get you set up!

Pricing is key if you want to sell your home.  No doubt about it.  There are several things that influence the price of a home.  But there are a couple of hurdles that sellers need to cross before they price it right.

1. O.P.P - original purchase price - it doesn’t matter if you bought the house 3 months ago or 30 years ago.  The price you paid has little to no bearing on the homes current value.  Your home is only worth what someone todaywill pay for it.  Just because you may have overpaid doesn’t mean someone else will.  I’ve had several sellers this past year who were in this predicament.  They bought at prime time, 3 years ago and paid asking price.  Now they try to sell, in a buyers market and have had to sell it below what they paid for it.  This is the reality of the real estate world.  Its just like the stock market, its a long term investment and just because you paid a certain amount for it doesn’t always mean you’ll get it in return.

2.  Supply and demand - There may be a lot of similar properties to yours out there on the market and buyers today have a lot to choose from.  So, they may end up choosing a different home if yours is similar but cheaper just down the street.   Or there may be one thats the same price as yours but more updated and bigger.   Many times when I go to list a home and the seller and I cannot agree on a good price, I will encourage them to go out and look at their competition with me.  This gives them a good sense of what they’re up against.

Correct pricing is not the only factor to getting your home sold.  Marketing and the agent you select is equally as important.  In this day and age if you don’t have good marketing you’ve got nothing.  If you’d like to know what I do that is different, give me a call!

These days it seems as though a majority of my time is spent with my clients talking to them about pricing.  We’ve all heard that home prices are going down (which they are) and I think logically sellers realize this, but when it comes to pricing their own home correctly they’re in denial…  (it becomes a lot more emotional).  I hear a lot of “Lets just see what happens at this price,”  “Well, I’ll entertain a lower offer, but I don’t want to advertise it.”  The list goes on….

Well, there are 5 reasons why a home is going to sell:

1. Location

2. Price

3. The Agent You Select

4. Terms

5. Condition

As a Seller you control 4 of these.  The only thing you can’t control is the location of your home.  Everything else is up to you.  In this market the 2 most important factors should be your price and the agent you select.  And if you select a good agent then he/she should be able to help you determine what the price of the house should be. 

So lets get to the reasons why homes don’t sell:

1. BEST OR BIGGEST HOME ON THE BLOCK

Surrounding properties do influence the value of your subject property.  I’ve actually had many potential sellers tell me “Well, we’re not going to price our house according to the home prices around ours.  We’ve done more improvements and feel our home is worth more.”  You cannot forget about your neighbors.  Their home value influences yours.

2. ABSORPTION RATE - The Absorption Rate is the ability of the real estate market to sell off all of the houses that are for sale. This was defined in a previous post I had about the absorption rate in Norwood.  The agent you select should talk about this rate and how it will effect the price you select and how long your house will sit on the market.  When I go on a listing presentation and talk with my sellers about what is specifically happening in their area and show them facts and figures, their pricing strategy goes from being more emotional to more statistical.  Numbers don’t lie.

3. PRICING STRATEGIES FOR A CHANGING MARKET

In a rising market, you can overprice and the market will catch up

In a flat market, a high asking price won’t be “saved” by the market

In a declining market, even a market price may be too high as prices drop - This is what is happening here (and everywhere).  This is why it is so important to have an agent who can and will effectively price your home.  It is the homes that are priced correctly right away that sell the quickest!

Selling your home is never an easy task.  As an agent I try to make it a fun and painless experience.  If you or anyone you know is interested in buying or selling property, I would love to speak with them!

Last Nov Cincinnati council voted to push forward with plans for a streetcar line from Freedom Way in downtown to McMicken Avenue in Over-the-Rhine.  Which would undoubtedly help to revitalize the downtown area.  Yeah for streetcars!
Today, the front page of the enquirer gave us a bit more of a look at the proposal and how it compares with Portland’s streetcars.  City planners and council members have been using Portland’s streetcar plan as a model for our own.  According to the article:

“Six years ago, Portland launched a streetcar linking rundown, underused property near downtown to the city center. There were several goals, but the most important was to jump-start development and redevelopment.

It worked. To date, Portland counts $3.3 billion in private investment within three blocks of its 3.6-mile circuit. The route has been extended three times since 2001, with more ambitious growth on the drawing board.“

This is fantastic news for the growth of our rundown and underused property downtown. 

So what makes a streetcar better than a bus system?  And how will it help with revitalization?  

1. Permanence- The cars run on steel rails embedded in the pavement and are powered by electricity delivered through slender overhead wires.  This permanence is especially helpful for people looking to invest in the areas along the route.  Investors want to know that they are investing in an area that is going to grow and bring people in.  Bus routes can change, streetcar routes cannot. 

2. Better perception - Buses also have a stigma that go along with them.  It has been found that more people will ride a streetcar over a bus.

3. More environmentally friendly - Because they are electric less CO2 will be emitted.  Wouldn’t Al Gore be happy??

We, the people of Cincinnati should be very excited about this new streetcar system and what it will do for our city.  If you want to check out the entire article in today’s paper to get more info go here: http://news.enquirer.com/apps/pbcs.dll/article?AID=/20071211/NEWS01/712110346/1077/COL02&GID=ye9fV9Uiz47ffV4ivzIThb4OJjRW5RjCwtv3bUAUC6g%3D

I recently found this really great website that rates how “walkable” your neighborhood is.   http://www.walkscore.com/

Basically it helps you determine how close things are to your perspective property.  We at Sibcy Cline have an interactive map on each of our properties websites that shows how close it is to area restaurants, shopping, groceries, etc…  This website takes it one step further and rates your neighborhood on a scale of 1-100 based on how many and how close these things are to you. 

It neat and a lot of fun to play with :0

What I found was interesting is that my house in Norwood got a higher walkability rating than some houses in Hyde Park.  Usually people associate Hyde Park and Mt. Lookout to have a lot of things to walk to, but it looks like Norwood wins!