November 2008

On a month by month basis, the market is like a roller coaster. The Nov. market is ABOVE last years November market, but not too far off the 06 market. Sometimes when you look at the market, you have to look at a larger picture, and do so without someone looking over your shoulder pushing you to buy. That is not how Real Estate usually ever works, it is mostly just a disclaimer about the market. Simply a particular statistic being up or down is not enough. It is interesting to know the market of Nov. 08 is above Nov 07, but when you look at MORE information, it gives you a different picture knowing that it is similar to the market 2 years ago.

The other snap shot to look at is the market on a 12 month basis. If you have read other reports I have written you will see I often discuss a 12 month market. On a 12 month basis the market has CLIMBED 7%. This is about the same as the 30 year Real Estate average in the Unites States. Obviously that would mean that some years grow faster, and some grow slower. When you look at the monthly numbers instead of the annual numbers, remember: Our local Real Estate market is relatively small. We usually have 600-800 homes on the market, some multiple listing services have several thousand. With ours being a relatively small market a handful of low or high sales in just one month can skew the median and / or average prices up or down. For this reason, I always like to look at trends.

Even if you personally do not understand every trend, the more educated you become the more comfortable you will be buying. Work with an agent who can answer your questions, or get you answers. Your home is a big purchase. However, if it is your residence, everybody needs a place to live. Hope will the home you are looking at compare in price to a rental? In our area a person can often do well by buying a home. This is true whether the current market is rising, falling, or stagnant. Most people who decided to wait in 2006, or 2007 have seen home prices rise. Shop carefully, and then find the right home for you! If you have questions, as always, please feel free to call or write.

October 2008

Price, price, price. Everyone wants to know about prices. Prices are up. Prices, ( both median and average) are above the September and August prices. They are reasonably near the July 2008 prices. I believe this is the peak for 2008. Typically the prices here peak in the Summer, although we have a busy fall. This year, summer was slow, and while the fall has been slow, there was a little burst of activity. Of course, these pricing statistics are for homes that SOLD in October, thus they are homes that were purchased in August, or even July, in most cases. Selling price to list price was DOWN, below 95%. ( just below 94%). Unusually, I would normally say it is a Seller’s market if prices are strong, but of course we know that all the other factors especially that 93.9% sell price show us it is a Buyer’s market. Still fairly balanced in Ithaca, compared to many areas, but still a great time for buyers.

The total number of sales is DOWN, the 12 month period ending October 2008 had about 10% fewer sales than the same prior 12 months.

However, the biggest decline was in listings under contract. This October has 97 listings compared to 166 last October. A 40 % drop. The average for the last 12 months is also way down, but not that much. ( 29%). I expect more high end homes to simply not be built. Many builders are still sitting on homes they built 1, 2, or even 3 years ago, that are far larger than the normal size and price home, and is still being used for a model, and/or waiting for a buyer.

Should you buy? Analyze your expenses, if your rent is high compared to a mortgage, it may make sense to buy now. Rates are low. Prices are stable. Since many homes in this area are rented, it creates stability in the market. A seller who cannot get their price today knows they can get their price later, if the home is rented, and the rent supports the value. At this time of year, many rentals are rented through June of 09, and some are rented until well into 2010. This means that the home values will be stable, as investors look at rent as value indicator. Thus, if you are betting prices will drop, you may be betting against statistics and history.

Should you sell? Well, even though it is a good time to buy, it is still a good time to sell. How can that be? Prices are fair, with many people getting what they want from their sale. There are many inquiries, and many people watching the market. Price your home aggressively, and then be prepared to wait if needed. Your good offer will likely come quickly if your home is priced right. Many buyers now shop electronically, and get electronic notifications. Make sure your home is listed using electronic media, and then adjust the price monthly, unless you can wait, ( 6 months or more).It is perfectly okay to wait. Analyze the expense of waiting. Will you have to pay on two homes? Will the cost of your next home increase while you are waiting? If you cannot afford to lower the price by $10,000, consider lowering it $5,000 in order to bring more attention to your home. There are many other ways to bring added attention to your home. Please feel free to contact me for other methods and ideas.