Prudential Real estate

Real Estate: Homes on Market Taking Much Longer to Sell, in Past Six Months

On average, the length of time required from real estate listing to contract has increased dramatically in the U.S. in the past six months, according to HouseHunt’s latest national “Current Market Conditions” homes for sale activity survey. Seventy-five percent of respondents said it is now taking more than 30 days. Of that figure, 30% said it is taking more than 60 days.

Three months ago, 52% of survey respondents said the average time on the market required for a home to sell was more than 30 days on the real estate market. Six months ago, only 35% said it was taking more than 30 days as buyer frenzy continued unabated.

“Current Market Conditions” 4th quarter survey also found:

Home sales prices remain firm. Currently, 82% say they are getting 95% or more of asking home prices. This compares with 80% in the third quarter and 90% in the second quarter of 2005.

Solid appreciation. One-half of all respondents report home price appreciation of 10% or more in the fourth quarter, year-to-year. This compares with 46% in the third quarter and 42% in the second quarter.

Multiple offers down. Currently, only 50% of respondents report multiple offers. This is down from 70% in the second and third quarters of this year.

Buyers-sellers demand nearly equal. A more balanced real estate market between buyers and sellers demand has emerged in many parts of the country. This compares with a 61-39% buyer ratio in the third quarter.

First-time buyers. Currently at 35%, this percentage has stayed about the same for the last six-nine months despite price and appreciation spikes on the East and West coasts and in Florida, Phoenix and Las Vegas. Greatest first-time buyer activity continues to be in the South and Midwest. Repeat and move-up buyer activity remains strong. Investor and second-home demand has slowed.

Inventory of unsold homes growing. Sixty-five percent said the trend is up in local real estate markets. Fifty-five percent report a good supply in all price ranges. Only 38% reported a good supply six months ago.

Market Growth. Overwhelmingly, survey respondents said job and population growth continues to fuel housing demand in local markets.

“Our latest random survey findings are consistent with both nationwide housing sales data and forecasts of top industry economists,” said Michael Bearden, President and CEO of HouseHunt, Inc. “Our strong economy and consumer demand made record homes for sale possible in 2005 despite destructive hurricanes, rising mortgage interest rates and higher energy costs. We’re optimistic that a sustainable, more balanced housing market will be the cornerstone of the U.S. economy in 2006.”

A sampling of individual survey results:

o Clint Johnson of Rose & Womble and exclusive member agent in Virginia Beach and Norfolk, VA, area: “During the past few weeks we have seen a softening of the market, with fewer multiple home offers and buyers negotiating for closing cost assistance.” He noted that the area has seen tremendous growth in prices and in units sold. Median home price is $230,000, up 15-20% in the past year.

o Rod Sullivan of GMAC Metro Brokers, exclusive member agent for Lithonia, GA, reports more sellers than buyers with a good supply of unsold homes. Average time on the market is 90-120 days. “Our greatest activity is from first-time buyers. Median home price is $150,000. Sellers are getting 95-100% of asking prices.”

o Steve Gaines of CENTURY 21 Landtree and exclusive member agent in Greenwood, IN, reports more sellers than buyers and a good supply of unsold homes. “Average time on the market is 90-120 days,” he said. Median home price is $175,000.

o Diane Ash of Weichert Realtors and exclusive member agent in Middletown, DE, said lower property taxes are attracting buyers from New York, New Jersey and Pennsylvania. Median home price is $300,000. Average time on the market is 30-60 days.

o Tim Ireland of Coldwell Banker Honig-Bell and exclusive member agent in Mokena, IL, said sellers and buyers are about 50-50. Average time on the market is 60-90 days. Median price is $261,190 with a good supply of unsold homes.

o Leah and Neville Bradshaw of Long & Foster Old Town/Historic,, exclusive member agents in Lorton, VA, reported more sellers than buyers and a median home price of $543,000, up 10-15% over last year. Even though sellers frequently get more than 100% of asking prices, they said that first-time buyers are very active.

o Dan Urbach of Prudential California and exclusive member agent in Pacific Palisades, CA, said his market is settling down from a very hot seller’s market to a more balanced market. Median price home is $2 million, up 15-20% over a year ago. Average time on the market is 30-60 days.

Monte Helme is a national public relations consultant with HouseHunt, Inc. Previously, he was vice president of public relations and publications for Century 21 Real Estate Corp.; vice president of communications for AmeriNet Financial Services (now LendingTree); assistant city editor/Orange County for the Los Angeles Times; executive sports editor of the Rockford, IL, Morning Star and Register-Republic; and reporter for the Dixon, IL, Evening-Telegraph. Find real estate, homes for sale through public MLS and check what my home is worth by visiting websites: HouseHunt.com, moveUp.com, and SuperMLS.com, powered by HouseHunt, Inc. For additional information on HouseHunt, Inc., and the products and services it provides, please visit the HouseHunt-Inc.com corporate website.

What Does REO Mean When Buying Real Estate For Sale?

As a property investor, I am often asked what does REO mean when buying real estate for sale? An acronym for ‘real estate owned’, REO refers to foreclosure property repossessed by mortgage lenders. When foreclosure real estate does not sell through public auction it returned to the lender, who in turn lists the property for sale through an assigned realtor.

A second question buyers ask is what does REO mean in terms of buying houses at discounted prices? Most bank owned homes are sold slightly below market value. Since properties are sold in “as-is” condition, banks consider home repair costs and adjust prices accordingly.

Although REO homes are typically more expensive than houses sold through public auctions, overall they are actually cheaper. Most foreclosure properties require multiple repairs because foreclosed homeowners are financially incapable of properly maintaining the home.

Many properties sold through auctions have liens and judgments attached. In some cases, foreclosed homeowners continue residing in the home until evicted through the court system. All of these issues are resolved once the bank takes possession of the home. Buyers are able to purchase REO homes with a clean title and quickly take possession.

Real estate owned properties are sold through each bank’s loss mitigation division or designated realtor. Since banks have incurred foreclosure legal costs and fees associated with lien, judgment or tenant removal, there is little room for negotiating the asking price.

Bank owned homes can be a great option for first time home buyers, real estate investors, or individuals looking for an affordable vacation home. REO houses are perfect for use as rental houses or lease-to-own properties. Since bank owned foreclosures are priced below market value, investors can reap profits by rehabbing and flipping the house or offering seller carry back financing.

Buying bank REO properties can save investors and home buyers time and money. There is no need to spend time attempting to remove creditor and tax liens or commence with eviction action when tenants refuse to vacate foreclosure properties.

Time-consuming details are taken care of by the bank; allowing buyers to purchase the property at a discounted rate and quickly take possession of the property. Closing on a foreclosure home can take several months, while REO purchases can be expedited in a matter of weeks.

Many resources are available for locating real estate owned properties. Countrywide, Remax, Prudential and Bank of America publish bank owned foreclosure homes for sale directly on their company websites.

Many mortgage lender and realtor websites include additional resources to help borrowers further reduce the cost of buying houses through first time house buyer programs and government grants.

These are just a few options available for buying REO homes at reduced prices. The Internet offers an abundance of information to help home buyers and investors locate distressed properties. Local realtors often offer foreclosure seminars to help buyers understand the process of buying foreclosure homes through auction or bank loss mitigators.

Take time to conduct research, attend seminars or talk with real estate professionals to learn the ins and outs of buying REO real estate. Doing so can help you obtain exceptional real estate at significantly reduced prices.

Online Real Estate Auction – How to Buy Cheap Real Estate Online

Buying a real estate property is serious business. It takes a lot of time, thought and money. The fact that you may need to spend a large sum of money to acquire properties can be quite scary.

They are several ways to buy cheap real estate online. They are through online properties auction sites such as eBay or government seized auctions.

Before anybody buys a property, there are so many things to think of such as the accessibility of the house, familiarity of the area, claims on it and the legality of online auction sales. The big question would always be if this online auction sale is legally binding.

There are two types of auction, binding and non-binding.

Before we further discuss these two, keep in mind that some online services such as eBay are not qualified companies that can actually sell property.

What these online services do instead is to connect potential buyers to the actual real estate sellers. Going back to the type of property auction, as previously mentioned, there are two types the binding, where you have expressed your intent to buy the property and in case you win, you are further obliged to settle and complete the purchasing of the property.

While on the non-binding property auction, even if you win in the auction, you can choose not to complete the transaction.

Government seized real estate on the other hand is a binding contract. These are usually seized from homeowners who can’t afford to pay mortgage loans and some were seized from criminals. They are usually a lot cheaper than houses for sale on the open market.

Just like on eBay, government seized properties are being auctioned and the highest bidder wins. However, I noticed most of the real estate being auctioned are being sold cheaper than anywhere else.

If you are looking for cheap properties to live or simply want to flip properties for profits, government seized real estate auctions is a good place to check out.

Appreciation in Real Estate

Appreciation is a very subjective word. It is said that what goes up, must come down; but what does that mean in Real Estate? Since the beginning of time we have seen the cyclical movement in Real Estate values. Sometimes it is just a natural self-adjustment of the market and at other times, such as now, there are other factors influencing prices such as economic issues in our core target-market and of course our own domestic issues.

It has been reported that the real estate market for cities in beach locations in Mexico was the one that most felt the effects of the slowdown in 2008. The real estate crisis in the U.S. put a brake on sales in the second home market, while the decline in tourism activity limited the ability for Mexico’s nationals to realize their dream of owning a vacation home as well.

Does that mean the market is dead and will never recover to the point where one can “own a piece of the rock”, as Prudential likes to say, and see their investment not only appreciate, but become one of the best investment returns of a life time?

Supply and demand have always been two of the most dynamic forces in the appreciation of any tangible product. Fortunately, Puerto Vallarta is always in demand for its tropical climate, beautiful topography and friendly people; and there is only so much coast line to develop, which creates a finite supply.

The challenge for 2010-2011 for realtors will be to adapt to an environment of slower growth, considering at all times real demand and attending more precisely to client preferences and needs, and remembering the rule of thumb has always been and still is, buy low, sell high, and there is no better time to buy low than right now to ensure that you will be able to sell high in the future.

About Marilyn J Newman
Associate at Prudential California Realty – Vallarta Division With a keen interest in Vallarta’s development, I am excited to be part of the Prudential Vallarta sales team and the burgeoning real estate market. A.M.P.I. associate and a member of Multi-List Vallarta and FLEXmls. I have passion for service excellence, professionalism and complete client satisfaction. -She has received the distinction of Certified International Property Specialist (CIPS)

Making Sense of Real Estate Lingo

As with all industries, real estate professionals have developed a lingo and acronyms to help them communicate with each other more easily. For the first-time home buyer (and even some veterans), making sense of property listings can sometimes leave you feeling like you’re deciphering the DaVinci Code.
Let’s take a look at a sample real estate listing:
2,500 sf on a c-d-s, 2BR, 2.5BA, CA, spac grt rm w/ wbfp, grmet kit, det gar
Looks a lot like alphabet soup. However, using this type of abbreviated property description saves valuable advertising space. Some abbreviations you’ll probably encounter are:

o AC or A/C: air conditioning

o BA: bathroom

o BR: bedroom

o CA: central air

o C-D-S: cul de sac

o DET: detached

o DK: deck

o EIK: eat-in kitchen

o F/FIN BSMT: finished basement

o FDR: formal dining room

o FP, frplc: fireplace

o GAR: garage

o GRMT KIT: gourmet kitchen

o GRT RM: great room

o HDW, HWF, Hdwd: hardwood floors

o HOA: home owners association

o LR: living room

o KIT: kitchen

o OFC: office

o PVT: private

o SF: square feet

o SPAC: spacious

o VW, VU: view

o WBFP: wood-burning fireplace

In addition to the abbreviations in property listings, here are a few other common terms you should become familiar with.

FSBO–For Sale By Owner. This term refers to a property which the homeowner is trying to sell independent of a real estate professional.

MLS–Multiple Listing Service. MLSs are comprised of a group of real estate brokers who have agreed to share their property listings. This listing is then provided to the group through a database or directory. If you are buying your home, this is the service that your sales professional will use to search for potential homes for you to purchase. If you are selling your property, your real estate professional can list your home through the MLS. For-Sale-By-Owner (FSBO) properties are typically not listed through the MLS.

CMA–Comparative Marketing Analysis. This analysis is an informal assessment of a property’s market value. This is one of the tools your real estate professional can use to help you determine a reasonable listing price. Usually, the CMA compares your property with similar properties that have sold in your area within a certain time frame. Besides purchase price, some of the information typically listed is the number of bedrooms and baths, approximate square footage, size of major rooms, amenities such as fireplaces and pools, age of the home, and property taxes.

During the real estate process, you’ll more than likely come across more acronyms and lingo. Make sure you ask your real estate professional to explain any terms you are unfamiliar with so that you are not in for any surprises.

By the way, the listing above was a 2,500 square-feet home on a cul-de-sac, with two bedrooms and two and a half baths, central air, a spacious great room with a wood-burning fireplace, and a gourmet kitchen and detached garage.