The low end of the market is on fire with multiple offers and low inventory.
The medium to higher priced homes are languishing, still falling in value.
In past recoveries, sales started at the low end, and those sellers bought up. It seems logical that this will happen each and every time, BUT...
Have you already guessed where I am going?
Many, if not most Sellers this time around are either banks or selling short. In either case, those sellers will NOT be moving up, EVER!
At least two thirds of the traditional "move up" sellers are missing this time around.
Also, many of those first time buyers are investors.
So, will there ever be a recovery?
Sure there will, and it will be a healthy, sustainable recovery. None of the speculative, unrealistic appreciation we experienced from 2000 through the first half of 2006. It will be slow, as many people are apprehensive about investing in a house.
Families are coming around, and beginning to think of a house as a home, a place to eventually pay off and own, where they are free of rent payments instead of a conduit for getting rich quickly.
The true American Dream is home OWNERSHIP - not home indebtedness.
Buying a home is only slightly more expensive than renting, requiring good paying jobs and making sacrifices. When families know that the value in their home will come from pride in ownership, and eventually paying off the mortgage giving true meaning to the land of the free, we will have returned to the American Dream that IS sustainable and truly worth striving for.
The low end of the market is on fire right now. There are a ton of first time buyers AND investors snapping up the lower priced inventory. The medium to high price homes are another story.
In past recoveries as the market recovered, sales at the bottom portion of the market led to sellers buying up into larger homes. While certainly that is happening this time too, it is occuring at a much slower rate.
Many, if not most of the homes being sold at the low end today are either Short Sales or Bank Owned properties. Those sellers will not be moving up, EVER.
So, while I am very confident that there will be a recovery, I'm not convinced that it will happen as quickly as many of us would like.
Ok, so it's time to paint the inside of our house.
It's been the builders white since we bought it almost 15 years ago. It was nice, and easy to touch up. The paint still looks new, but we are ready for a new look.
We are going with a light beige for most of the walls - We are considering either Dunn Edwards Sandcastle or Travertine.
If you are familiar with these two colors, I would REALLY like your opinion. If you are not, you can check out all of Dunn Edward's colors here -
http://www.dunnedwards.com/retail/content.asp?Category=89&Content=0
just type to name of the color in to see a sample.
We have a pretty dramatic living room open to the second story ceiling.
The Sandcastle is a very light beige and the Travertine is a shade darker.
What do you guys think?
Oh, the doors will remain white (actually swiss coffee which is off white).
So, what about the floor molding. I'm thinking it should match the doors and door molding, white as well.
Love to hear from you.
Paul
It's been said hear on AR that Tax payers will be repaying the Real Estate Tax Credit for generations. That may be true. It's also been said that it artificially manipulates the housing market and is doomed to fail!
Look, the market has been manipulated since congress allowed the mortgage interest deduction and the Real Estate Tax deduction. Should we also eliminate those? What's the difference? Other than the tax credit is going to be short lived in relation to the interest and tax deductions.
There are precious few homes on the market in South Orange County under 500K that are not short sales. I blame (credit), the tax incentive. Homes have been selling very rapidly on the low end here. I put in an offer last week and had to compete with 25 other offers!! $8000 isn't a huge incentive, but for someone thinking about buying, it may just be enough to help them make up their minds.
Is the tax stimulus artificial? Nope, buyer's really get the money.
We've rewarded many financial institutions for making bad investment decisions. Who in the world came up with the idea that it's ok to lend to a buyer that has nothing down, and oh yeah, believe whatever they claim as income (stated income). Maybe those institutions should have been punished (of course many were).
What about those that have lost their homes. We allowed many of them to be forgiven debt on Short Sales without taxing them. Should we not have done that?
We are in a real pickle here folks. Maybe we should have just let the whole thing collapse and let the cards fall where they may. That would be true capitalism, right?
The way I see it, buyers today are the good guys, they are the ones willing to purchase homes while others point the finger and complain about how things should have been done. It's the courageous home buyers today that are going to get us out of this jamb and get our economy rolling again. Personally, I feel they deserve a reward in the form of a Tax Credit, in fact, I for one think it should be MORE.
Bottom line is, we have rewarded a lot of groups that made poor decisions. Without buyers, there wouldn't be a Real Estate market. A small incentive, if nothing else, to show that our nation applauds them for being courageous, is well worth the cost.
All you need to do, is accumulate 49,800 points or more, then just write ONE MORE Blog, and yep - you too will hit 50,000 points. Sorry, I don't know of an easier way....
Wow, I guess I have done a lot more Real Estate blogging than I thought.
Thinking back, the one thing that helped more than anything else is the fact that I type about 100 words a min. And you thought I was going to say something profound.
Thank you Active Rain community - this has (and continues to be) a great ride!!
Besides being a Realtor, I am also a Microsoft Certified System Engineer.
Early this year I installed Windows 7 - I am one of Microsoft's Beta testers.
I have to say, that I really like Windows 7, but there WERE some challanges for me.
Mainly, some of my peripheral hardware was not supported with the 64 bit version of Windows 7
My high speed Fujitsu scanner was one, and my color laser printer was another.
Not being able to use those two devices alone would have kept me from moving to Windows 7.
If you hardware is new, purchase within the last year or so, you should be fine.
Note that there is an and on called Virtual XP that will allow you to run XP at the same time you are running Windows 7, so if you have unsupported hardware, you can run it under XP - but wait, you also have to have a computer whose motherboard and CPU supports Intels virtual mode. Mine is pretty new, and it does not.
The absolute most important things that had to be supported were Winforms (online contracts), and Docusign (online e-signatures).
I'm please to say that both of those applications work great.
Should YOU move to Windows 7 -
If you are due for a new PC - then for sure get Windows 7
If you want to keep your existing PC - but it's been a couple of years since you installed an Operating System, then you are probably due. Might as well upgrade to Windows 7.
If your are running the 32bit version of Vista, you can do a UPGRADE to Windows 7 without having to reinstall all of your applications. Same goes for the 64 Bit versions.
You CANNOT upgrade from the 32bit version of Vista to the 64bit version of Windows 7, I know, because that was my situation.
Finally, I just want to add that I was not able to install the final released version of Windows 7 on my machine, it would NOT install, and I am NO novice. What I had to do was install the 64bit version of Vista first and then UPGRADE that to Windows 7. What a pain, but I have a unique system with lots of hard drives and a RAID system. You probably would not have that issue.
OK- test questions - do yo know why they called it Windows 7????
Because that's what it is....
Windows 3,
windows 95,
Windows 98
Windows Millinium
Windows XP
Windows Vista
and Finally, Windows number 7!
Actually, there many other versions too - Windows 2, Even Windows 1, released in 1983 (I used it).
Plus lots of other versions, but those above were the widely accepted versions.
We had a new short sale come on the market. The clever listing agent only allows showing for one weekend. He publishes the dates and time in the MLS, and clearly states that if you are interesed, you must view it then. All offers were due by 5:00PM Monday.
He was asking for Highest and Best offers.
Why is this a good idea.
The seller isn't bothered with having to show the property, it's only shown Sat and Sun.
The agent only has to hold one open house, well technically 2.
The open house creates a lot of traffic, getting those interested, enticed to make a more substaincial offer.
The listing agent also states in the MLS that the "seller" will make a decision by Thursday. Ok, so the seller making a decision doesn't really help that much, but if it helps a potential buyer make a decision, then it's a good move.
Some banks will only consider one offer at a time. Getting the Highest and best offers, then submitting THE absolute highest and best offer to the bank should greatly increase the odds of getting a short sale approved.
He has made a believer out of me. I'll handle my next short sale listing this way.
Oh - how many offers did he get? 18!!!!
Now, please cross your fingers for me and my client, because we were on of those 18 making an offer.
Nothing to see here folks - Just noticed that I had 199 blog posts, and figured I would make it an even 200.
Interest in Rancho Santa Margarita Real Estate continues to increase. Foot traffic at open houses is the best I have seen in years.
Some have said it because the tax incentive is coming to an end, but I don't think that fully explains it. There are too many investors paying cash, and certainly most of those are not first time buyers.
I did a quick comparison of sold condos for 3 different time frames in Rancho Santa Margarita. I looked at condos from 900 to 1200 square feet. I pulled sales data from the three following time frames:
12/1/2008 through 1/31/2009
1/1/2009 through 3/1/2009
9/1/2009 through 10/18/2009
Anyone who is working in this market can attest to how it's changed over the last 9 months. We have gone from a lot of bank owned properties, to almost none.
We are seeing HUGE demand in this sector with several offers on every condo that is reasonably priced, and is not a short sale.
We are seeing several ALL cash offers.
We are witnessing FHA, first time buyers being forced to the sidelines as investors swoop in and grab these homes at bargain prices.
In the first time frame above, the Median selling price per square foot was $256.34. That dropped to $252.30 for the second time frame. Prices have since risen to $254.29.
While the price increase seems insignificant, extrapolated over a 12 month period equates to a 1.5% increase - which in my opinion equals healthy growth.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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