Des Moines September's home sales rose to from the year earlier due in large part to the home buyer tax credit set to expire on November 30th 2009.

I noticed a lot of activity related to first time buyers both on the buying and listing sides. My feeling is that hesitant buyers who had been waiting all year finally got spooked that the tax credit would not be extended or changed substantially and so went on a buying spree.

Our association president was quoted in an October 13th Des Moines Register article as saying" "I believe there are a lot of first-time home buyers out there trying to get their deal done before the deadline for the $8,000 tax credit," said Kurt Schade, president of the Des Moines Area Association of Realtors.

Some highlights from September:

• 475 sales, or 52% of the total unit sales were for homes priced $100,000 to $200,000
• Less than 40 homes were sold last for more than $300,000.
• Unit sales increased to 913, from 772 the year prior.
• Average sales prices fell to $151,589 from $167,366 the year prior.
• Days on market increased to 100 from 96 the year prior.

 Data courtesy of the Des Moines Area Association of Realtors

This year, 2009, will mark the third year I've had the honor to volunteer to assist in the NAMI Walk sponsored by the National Alliance for the Mentally Ill Iowa Chapter. If you're unfamiliar with NAMI Iowa here's their mission from their website:

"NAMI IOWA is a non-profit, state-wide grass roots organization.  Our mission is to raise public awareness and concern about mental illness, to foster research, to improve treatment and to upgrade the system of care for the people of Iowa. We work to support our mission through education, advocacy and support."

Many people are affected by and struggle with mental illness on a daily basis. Just in the Des Moines area this year there have been at least four incidents where police have been called to apprehend a mentally ill person and the individual has been shot and killed or accidentally maimed or injured. But aside from the high profile cases, many with mental illness are unable to stay employed, care for themselves, or become productive members of society. It is estimated that one if four families contains a memebr who suffers from a serious mental illness.

You can find this years walk in Des Moines' Water Works park by taking Park Ave south to Valley Dr. and by entering the south exit appx. 1 mile off Park, across from the Racoon Valley soccer fields. You will then go left appx. 1 mile more. The way should be clearly marked.

This year's 2009 NAMI Walk IOWA is sponsored by The Des Moines Radio Group and Polk County. All donations benefit NAMI and NAMI Iowa. The walk begins Saturday, October 3rd, 2009 - 8:00 AM Registration Starts, 9:00 AM Opening Ceremony, 9:30 AM Walk Begins, Vendor booths open and activities continue until 11:00 AM.

You can register yourself or a team by clicking on this link,2009 NAMI Walk IOWA , or by just showing up! Last year the walk was able to raise $109,000 from just the Des Moines walk alone. If you have the time and are able we'd love to see you there on Saturday!

You have some clients or a client. They've told you they're first time buyers and they are eagerly seeking to take advantage of the up to $8,000 First Time Home Buyer Credit available at present until November 30th 2009. They are looking at homes right and left. You're calling and making appointments. You are making offers. Agents are asking you, "Are these first time buyers?" So what do you say?

NO WAY!!!!!

I've had several offers recently on my listings where this issue came up. In all cases the Buyer Agent volunteered the buyer status. I appreciated the information which I readily passed on to my seller. However, the Buyer's negotiating position was weakened as a result. Why?

1. Because the seller knows that the buyer, if they can get an accepted offer, will be getting up to $8000 off.
2. Because the seller knows the buyer is in a hurry to get something under contract.

The seller now realizes the buyer has both a big subsidy and urgency. This does not work in the buyer's favor. In fact it probably can be argued that it is better to say that the person is not a first time buyer no matter what. Because then the urgency and subsidy is off the table and the seller is back to square one.

As agents, (fiduciaries) our duties to our clients involve exercising ordinary care and diligence, and by state law we are obligated not to disclose a clients real estate needs, at least in Iowa. So if you carelessly disclose the client status you are likely violating state law and the REALTOR code of ethics. (Standard of Practice 1-9) If it was the case that the client asked me to tell, I'd want to try to educate them about the pros and cons first.

I don't ask the status of the buyer of showing agents on my listings because in my experience agents will readily provide it without me having to even ask! However, often when I'm setting up appointments, selling agents ask me if the client is a first time buyer. My standard response is "No, they're buying this home the hard way, with their own money." But that's just me.

The Iowa Association of Realtors has released complete housing stats for the month of August 2009. Iowa and Des Moines unfortunately bucked positive national trends to post declines in average prices, but posted slight gains in volume(good!), but also in days on market(not good!). Here's a summary:

Unit sales 08/08-08/09: +1.2% From 814 in 08' to 824 in 09'

Average Price 08/08-08/09: -10.1% From 179,053 in 08' to 160,918 in 09'

Days on Market 08/08-08/09: +3.0% From 101 min 08' to 104 in 09'.

With the all the activity occuring with the pending expiration of the first time home buyer tax credit I would have guessed a greater rise in unit sales but the numbers did not bear that out. I wasn't really surprised but the drop in prices however as the inventory foreclosed homes and short sales continues to be robust in the face of Iowa's continued climb in unemployment numbers to 6.8%.

Said Elisabeth Buck, director of Iowa Workforce Development. ".... the state's unemployment rate is likely to remain high into 2010, despite an optimistic forecast of improving conditions in the second half of this year." Somebody should inform Elisabeth that this is the second hald of the year and we're experiencing the third consecutive month of increases in the unemployment rate (and business closures), thereby triggering the federal goverment to extend jobless benefits to Iowa's unemployed by 13 weeks.

Housing data courtesy of Iowa Association of Realtors

Maybe we're behind the curve, or perhaps we're out in front, my suspicion is though that all agents in Iowa will enjoy the new housing stats system unveiled by the IAR in September 2009.

We've always been able to produce reports, but data such as unit sales per month, comparisons to previous years and housing price trends have not been readily available. That's all changed now with the new report system as evidenced by this August 2009 Housing Stats Report. I, like many agents I suspect, was relegated to wait until reading the numbers in the Des Moines Register the day after the figures came from the board. This new system however means I can log-in and easily get the numbers in an easy to read format that I quickly can share with clients and prospects.

Trends are valuable in that listing agents and clients don't have to just guess about what's happening in the area or market, they can have ready access to the data to readily gauge:

1. How aggressive to be on pricing
2. Ascertain number of competing listing
3. Determine whether prices are rising or falling
4. Determine whether days on market are rising or falling

Buyers can also benefit by using the stats to determine:

1. Price trends up or down
2. Declining or accelerating inventory of homes
3. Wheter or not homes on market are within normal ranges
4. Motivations of sellers

If you're looking to buy or sell and would like to analyze the trends to determine your best strategy, give me a call and we'll set up an appointment.

This year, 2009, will mark the third year I've had the honor to volunteer to assist in the Memory Walk sponsored by the Alzheimer's Association-Greater Iowa chapter. Alzheimer's affect so many people which makes this a very important event. Just today I had a client in my office whom I invited to participate in the walk. He had to decline because the very same day, he would be attending his grandmothers funeral who was coincidentally, an Alzheimer's sufferer for many years.

The walk will commence at Des Moines Water Works Park.  Walkers may enter the park by taking Park Ave south to Valley Dr. and by entering the south exit appx. 1 mile off Park, across from the Racoon Valley soccer fields. You will then go left appx. 1 mile more. The way should be clearly marked.

This year's 2009 Memory Walk is sponsored by Care Initiatives. All Memory Walk donations benefit the Alzheimer's Association, the leading voluntary health organization in Alzheimer care, support and research. The walk begins Saturday, September 26, 2009 - 8:00 AM Registration Starts, 9:00 AM Opening Ceremony, 9:30 AM Walk Begins, Vendor booths open and activities continue until 11:00 AM.

You can register yourself or a team by clicking on this link, 2009 Memory Walk, or by just showing up! Last year Alzeimer's.org was able to raise $584,000 nationally through its Memory Walk initiatives. If you have the time and are able we'd love to see you there on Saturday!

Plastered all over the media this past week was news that mortage rates fell for the week ending September 7-11 2009 as a result of Fed auction results. The rates are now near historic lows. Here are a few links to stories about the drop which was announced primarily on September 10th 2009:

http://www.mortgagenewsdaily.com/consumer_rates/106240.aspx

http://www.freddiemac.com/pmms/release.html

http://www.housingwire.com/2009/09/10/weekly-mortgage-rate-dips-to-507-freddie-mac/

http://www.foxbusiness.com/story/markets/industries/finance/freddie-mac-fixed-mortgage-rates-inch-lower/

From the Fox news article above: "The national average interest rate on the benchmark 30-year, fixed-rate loan averaged 5.07% in the week ending Thursday, down from last week's 5.08% and the year-ago 5.93%"

Some pundits are even predicting mortage rates will fall further:

http://themortgagereports.com/2009/09/mortgage-rates-cincinnati-september-10-2009.html

Comparing 5.07%, the new rate, with last years 5.93%, shows that on a $100,000 30 year fixed loan a buyer today would pay $541.11 dollars, compared to $595.06 for the same amount last year, or about 9% less. Wow! What a difference a year can make. With good rates and the $8,000 tax credit in place until November 30th 2009, buying vs. renting just make start making a whole lot more sense to some people.

The stats are in! The stats are in! July 2009 was a blowout month for sales in the area with 890 homes sold* making July the best month for unit sales since August 2007. So, many were hoping that August would ride July's coat tails. Sadly, those folks were disappointed. Data released on Thursday from The Des Moines Area Association of Realtors showed:

Units sold: 775, -3.4% from 08/08

Pending sales: 988, +30% from 08/08

Active listings 5,692, -8.1% from 08/08

Average days on market: 93, -4.1% from 08/08

The economy continued to struggle in August in Iowa with more companies shedding jobs more plant closings and low dairy, corn, and soybean prices all taking their toll on Iowa's rural areas. It's no surprise then that unit sales could not get traction going into the fall. Pending sales are up however indicating most likely that buyers are rushing to get homes under contract in advance of the $8000 home buyer credit expiration on November 30th 2009. In a separate stat I read that 57% of the sales this year have been for home priced $160,000 or under, which, if accurate, means first time, entry level buyers and investors are really floating the boat in 2009.

*Source Des Moines Area Assocaition of Realtors

For the first two years of the real estate market slowdown our local paper, The Des Moines Register did a pretty poor job of accurately reporting on the housing crisis and its effect on the local economy. This year however it has been putting out some pretty good stories about how the Des Moines market has been affected. Two recent articles that did a great job of not glossing over the facts and showing the depth of the issue were Karen Mraceks September 4th piece Defaults, Foreclosures send bank holdings soaring, and Donelle Eller's top of the fold front page story Sunday September 6th  Foreclosures Seen Hurting Home Values.

Donelle Eller's story was complete with a graphic showing foreclosed properties mapped out across the county. It added a very visual dimension to a subject that is often treated only with line type. On the map one could see huge clusters of foreclosed homes in certain areas, but one could also see that the problem really covers the entire metro area and suburbs, not just traditionally blighted inner city areas. Some key points cited in from the article from local and national sources were (quoting):

"Foreclosed houses in Iowa will reduce the value of 317,552 neighboring homes by $323 million this year"

"Foreclosed homes, mostly sold by banks after a sheriff sale, accounted for about 9.5 percent of last year's $4.5 billion in Iowa home sales. So far this year, foreclosed homes account for about 8.3 percent of Iowa home sales, compared with 3.4 percent two years ago"

"About 15 percent of all Polk County home sales from January through July were of homes owned by lenders. In Dallas County, the sales were 12 percent."

"Lender-owned homes typically were sold about 35 percent below market value in Polk County from January through July, and 22 percent below market in Dallas County."

"The gap between the market value and the sales price is the largest on properties selling for $150,000 and less - ranging from about 20 percent to 60 percent below market values, 2009 data from the Polk County assessor's office show."

"Nearly 130 lender-owned homes in Polk County and 29 in Dallas County sold for less than $50,000. The lower-priced sales made up about 30 percent of foreclosure sales in both counties"

An interesting fact that I learned from the article was that, quoting, "Distressed sales may be considered when private appraisers determine a home's market value to secure a mortgage, but excluded when the assessor considers a home's value for tax purposes."

So, foreclosures drive down market values, the price a home actually sells for, but that reduction in value does not give you a break on your property taxes! I'd call that a quadruple whammy: Lower values due to foreclosures, increased competition for buyers from foreclosed homes, less equity for homeowners from appraisals, no benefit to homeowners affected by lower values in the form of reasonable taxation. I'm sure there's a really good reason why the assessor won't consider foreclosed homes when determining your tax bill. I'm sure there is.

All rancor aside, the Register has been putting out some good information for the public this year despite massive layoffs and scathing cost cutting. It's no fun for anyone to read these things but it's better than having the reality swept under the carpet. Lets just hope the recovery we're all hoping for is on its way. Property owners in Polk County would love to see it.

Well it's that time again. Time to close the pools and elect four new members to serve four year terms to the Des Moines school board.

Since Des Moines has a fairly large district with 30,783 students anda budget of appx. $420,650,000 funded by local residents and homeowners, it behooves the general populace to get involved by participating in the selection of school board members.

This time around three incumbents are fighting to remain in their seatson the Des Moines School Board: Connie Boesen,  Patty Link, Teree Caldwell-Johnson, against 6 challengers: Margaret Buckton, Felipe Galardo, Timothy Halsted, Veola Perry, Thalia Sutton, and Zachary Toillion, whom you can read about by following the link.

The board members elected on September 8 will serve four-year terms, new for the first time since the state law recently passed requiring four-year terms. As a result, school board elections will be held every two years thereafter.

Polling places will be open from 7 a.m. to 8 p.m. on Sept. 8. Information for voters, including polling places, can be found here. Several other municipalities will hold elections for board members and or referendums for spending the .01 cent sales tax and various public measures. See the ballots here.

This year you can register and vote the same day at the polls. I will be serving as Precinct Chairperson at Precinct 75 in Des Moines at 2501 Park Ave. this year along with Shirley and Delores with whom I have worked several elections. One of them always brings some yummy baked goods and they are both lots of fun to work with and to talk to. Should be a great day. See you at the polls!