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Inventory Drop Fuel Sales Slowdown [INFOGRAPHIC]

Drop in Inventory Fuels Sales Slowdown [INFOGRAPHIC] | Simplifying The Market

Drop in Inventory Fuels Sales Slowdown [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • Existing Home Sales are now at an annual pace of 5.46 million.
  • Inventory of existing homes for sale dropped to a 4-month supply marking the 35th month of declines.
  • The median price of homes sold in April was $257,900. This is the 74th consecutive month of year-over-year price gains.

If you are in the real estate market to buy real estate or sell real estate,  contact Steven Batista, today!

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Selling Your Home On Your Own Could Cost You

Selling Your Home On Your Own Could Cost You!

Selling Your Home On Your Own Could Cost You.  In this extremely hot real estate market, some homeowners might consider selling house by owner. This is known as a For Sale by Owner (FSBO). 

FSBO's rationalize that they don’t need a real estate agent and believe that they can save the commission for the services a real estate agent offers

Selling a house in Bergen County NJ is a full time job which requires a full time Realtor.  When a home owner assumes the position of a Realtor when selling home by owner is asking for trouble. 

As your Bergen County Real Estate Expert, I offer free comparative market analysis.  Home owners don't have access to this critical information when selling home by owner.  The goal is to protect your equity. 

There are several tasks a home owner has to undertake when selling home by owner. Having a real estate education, finding a homebuyer who's pre approved for mortgage is a small part of the process.  Scheduling showings when you sell your own home and opening your doors to homebuyers can potentially lead to theft. 

Please review the article entitled, "How To Protect Your Home When Showing It To Potential Buyers," by Lee Nelson.  

Once a buyer is willing, ready and able to purchase a home from a FSBO, a contract must be executed.  The contract Realtors use is The Statewide New Jersey Realtors Standard Form Of Real Estate Sales Contract. 

Collecting the earnest money deposit and placing it in the sellers attorney's escrow account is next. 

We move on to attorney review which can extend itself well beyond the three day attorney review period.  A buyer can back out at anytime during the attorney review period and the home inspection clause. 

If the home buyer can't secure a mortgage loan the deal will fall apart.  Let's say the home buyer obtains a mortgage commitment the next process is to confirm they secured home insurance. 

Hiring a title insurance company to clear title, getting the Certificate of Occupancy and collecting deposits will lead to closing.

A for sale by owner will go through great lengths to save on the real estate commission.  Some home sellers wonder how they can list house on MLS (Multiple Listing Service).  Listing with MLS has to be done with a licensed Realtor. 

After some research online they encounter Realtors who offer a MLS flat fee listing  to advertise their home.  Some Realtors will charge a for sale by owner as little as $99.00.  Imagine the diluted service a for sale by owner will receive when they subscribe to that.  I recall the old adage, "you get what you pay for."  A flat fee MLS listing may cost the for sale by owner thousands of dollars. 

Contracting a Bergen County Real Estate Expert like myself, gives a FSBO a chance to actually sell their home.

A study by Collateral Analytics reveals that FSBOs don’t actually save anything. In some cases they may be costing themselves more by not listing with an agent.

In the study, they analyzed home sales in a variety of markets. The data showed that:

“FSBOs tend to sell for lower prices than comparable home sales, and in many cases below the average differential represented by the prevailing commission rate.” (emphasis added)

Selling Your Home On Your Own Could Cost You

Why would FSBOs net less money than if they had used an agent?

The study makes several suggestions:

  • “There could be systematic bias on the buyer side as well. FSBO sales might attract more strategic buyers than MLS sales, particularly buyers who rationalize lower-priced bids with the logic that the seller is “saving” a traditional commission. Such buyers might specifically search for and target sellers who are not getting representational assistance from agents.” In other words, ‘bargain lookers’ might shop FSBOs more often.
  • “Experienced agents are experts at ‘staging’ homes for sale” which could bring more money for the home.
  • “Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.” If more buyers see a home, the greater the chances are that there could be a bidding war for the property.

Conclusions from the study:

  1. FSBOs achieve prices significantly lower than those from similar properties sold by Realtors using the MLS.
  2. The data suggests the average price was near 6% lower for FSBO sales of similar properties.

Bottom Line

As Dave Ramsey, America’s trusted voice on money, explains:

“Research has shown that, between mistakes, lack of negotiating skills, pricing errors and general exposure on the market, you’ll cost yourself more than the real estate commission…You’ll come out slightly better and with a lot less hassle if you use a top-shelf agent.”

Looking for a Teaneck real estate agent, contact Steven Batista at 201-207-5217.  Start the home selling process Today.

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Don’t Wait to Sell Your House! Buyers Are Out Now

.Don’t Wait to Sell Your House! Buyers Are Out Now | Simplifying The Market

Sell your house.  Don’t wait!  Recently released data from the National Association of Realtors (NAR) suggests that a now is a great time to sell your home. The concept of ‘supply & demand’ reveals that the best price for an item is realized when the supply of that item is low and the demand for that item is high.

Let’s see how this applies to the current residential real estate market.

SUPPLY

Supply of homes for sale has been far below the number needed to sustain a normal market for over a year. A normal market requires six months of housing inventory to meet the demand. The latest report from NAR revealed that there is currently only a 3.6-month supply of houses on the market.

Supply is currently very low!

DEMAND

A report that was just released tells us that demand is very strong. The most recent Foot Traffic Report (which sheds light on the number of buyers who are actually out looking at homes) disclosed that “foot traffic grew 10.5 points to 52.4 in March as the new season approaches.”

Demand is currently very high!

Bottom Line

Waiting to sell will only increase the competition between you and all of the other sellers putting their houses on the market later this summer. If you are debating whether or not to list your home, are a distressed home owner looking options, want to know what your home is worth or want to contact Steven Batista, with Century 21 Allstars 100 Real Estate, today! I can offer selling tips, provide you with a Comparative Market Analysis (CMA) and more!

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Is Your First Home Within Your Grasp Now? [INFOGRAPHIC]

For the longest time, many experts doubted whether Millenials (age 18-36) valued homeownership as part of the American Dream. Looking at the latest statistics from the National Association of Realtors we can see that 'Old Millenials' (ages 25-36) are dominating the first-time homebuyer category.
Is Your First Home Within Your Grasp Now? For the longest time, many experts doubted whether Millenials (age 18-36) valued homeownership as part of the American Dream. Looking at the latest statistics from the National Association of Realtors we can see that ‘Old Millenials’ (ages 25-36) are dominating the first-time homebuyer category.

Is Your First Home Within Your Grasp Now? [INFOGRAPHIC] | Simplifying the Market

Some Highlights:

If you are in the real estate market to buy a home, are a distressed home owner looking options, want to know what your home is worth or want to sell real estate,  contact your Century 21 Allstars 100 Real Estate Agent, Steven Batista, in Teaneck NJ today! I can offer selling tips, provide you with a Comparative Market Analysis (CMA) and more!

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What If I Wait Until Next Year to Buy a Home?

What If I Wait Until Next Year to Buy a Home? | Simplifying The Market

We recently shared that national home prices have increased by 6.7% year-over-year. Over that same time period, interest rates have remained historically low which has allowed many buyers to enter the market.

As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.

The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 5.2% over the next 12 months.

What Does This Mean as a Buyer?

If home prices appreciate by 5.2% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today:

What If I Wait Until Next Year to Buy a Home? | Simplifying The Market

Bottom Line

If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan.  Also, buying a home is cheaper than renting.

If you are in the real estate market to buy a home, are a distressed home owner looking options, want to know what your home is worth or want to sell real estate,  contact your Century 21 Allstars 100 Real Estate Agent, Steven Batista, today! I can offer selling tips, provide you with a Comparative Market Analysis (CMA) and more!

Source: Keeping Matters Current

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50% of Homes Sold in 30 Days in March [INFOGRAPHIC]

50% of Homes Sold in 30 days in March [INFOGRAPHIC] | Simplifying The Market

50% of Homes Sold in 30 Days in March

Some Highlights:

  • The National Association of REALTORS® recently surveyed their members for their Confidence Index.  
  • The REALTORS® Confidence Index is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. Practitioners are asked about their expectations for home sales, prices and market conditions.
  • Homes sold in less than 60 days in 35 out of 50 states and Washington D.C.
  • Homes typically went under contract in 30 days in March!

If you are in the real estate market to buy a home, are a distressed home owner looking options, want to know what your home is worth or want to sell real estate,  contact your Century 21 Allstars 100 Real Estate Agent, Steven Batista, today! I can offer selling tips, provide you with a Comparative Market Analysis (CMA) and more!

Source: Keeping Matters Current

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This Just In: Data Says May is the Best Month to Sell Your Home

According to a newly released study by ATTOM Data Solutions, selling your home in the month of May will net you an average of 5.9% above estimated market value for your home.

For the study, ATTOM performed an “analysis of 14.7 million home sales from 2011 to 2017” and found the average seller premium achieved for each month of the year. Below is a breakdown by month:

This Just In: Data Says May is the Best Month to Sell Your Home | Simplifying The Market

ATTOM even went a step further and broke their results down by day.

Top 5 Days to Sell:

  • June 28th – 9.1% above market
  • February 15th – 9.0% above market
  • May 31st – 8.3% above market
  • May 29th – 8.2% above market
  • June 21st – 8.1% above market

It should come as no surprise that May and June dominate as the top months to sell and that 4 of the top 5 days to sell fall in those two months. The second quarter of the year (April, May, June) is referred to as the Spring Buyers Season, when competition is fierce to find a dream home, which often leads to bidding wars.

One caveat to mention though, is that when broken down by metro, ATTOM noticed that while warmer climates share in the overall trend, it turns out that they have different top months for sales. The best month to get the highest price in Miami, FL, for instance, was January, and Phoenix, AZ came in with November leading the charge.

If you’re thinking of selling your home this year, the time to list is NOW! According to the National Association of Realtors, homes sold in an average of just 30 days last month! If you list now, you’ll have a really good chance to sell in May or June, setting yourself up for getting the best price!

Bottom Line

Let’s get together to discuss the market conditions in our area and get you the most exposure to the buyers who are ready and willing to buy!

Source: Keeping Matters Current

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How Much Has Your Home Increased in Value Over the Last Year?

How Much Has Your Home Increased in Value Over the Last Year? | Simplifying The Market

Home values have risen dramatically over the last twelve months. In CoreLogic’s most recent Home Price Index Report, they revealed that national home prices have increased by 6.7% year-over-year.

CoreLogic broke down appreciation even further into four price ranges, giving us a more detailed view than if we had simply looked at the year-over-year increases in national median home price.

The chart below shows the four price ranges from the report, as well as each one’s year-over-year growth from February 2017 to February 2018 (the latest data available).

How Much Has Your Home Increased in Value Over the Last Year? | Simplifying The Market

It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor that determines how much your home has appreciated over the course of the last year.

Lower-priced homes have appreciated at greater rates than homes at the upper ends of the spectrum due to demand from first-time home buyers and baby boomers looking to downsize.

Bottom Line

If you are planning to list your home for sale in today’s market, let’s get together to go over exactly what’s going on in your area and your price range.

Source: Keeping Matters Current

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Why Home Prices Are Increasing

Why Home Prices Are Increasing | Simplifying The Market

There are many unsubstantiated theories as to why home values are increasing. From those who are worried that lending standards are again becoming too lenient (data shows this is untrue), to those who are concerned that prices are again approaching boom peaks because of “irrational exuberance” (this is also untrue as prices are not at peak levels when they are adjusted for inflation), there seems to be no shortage of opinion.

However, the increase in prices is easily explained by the theory of supply & demand. Whenever there is a limited supply of an item that is in high demand, prices increase.

It is that simple. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In most housing markets, anything less than six months will cause home values to appreciate and anything more than seven months will cause prices to depreciate (see chart below).

Why Home Prices Are Increasing | Simplifying The Market

According to the Existing Home Sales Report from the National Association of Realtors (NAR), the monthly inventory of homes for sale has been below six months for the last five years (see chart below).

Why Home Prices Are Increasing | Simplifying The Market

Bottom Line

If buyer demand continues to outpace the current supply of existing homes for sale, prices will continue to appreciate. Nothing nefarious is taking place. It is simply the theory of supply & demand working as it should.

Source: Keeping Matters Current

If you are in the real estate market to buy a home, are a distressed home owner looking options, want to know what your home is worth or want to sell real estate,  contact your Century 21 Allstars 100 Real Estate Agent, Steven Batista, today! I can offer selling tips, provide you with a Comparative Market Analysis (CMA) and more!

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“Short of a war or stock market crash…”

“Short of a war or stock market crash…” | Simplifying The Market

This month, Arch Mortgage Insurance released their spring Housing and Mortgage Market Review. The report explained that an increase in mortgage rates and/or home prices would impact monthly payments this way:

  • A 5% increase in home prices increases payments by roughly 5%
  • A 1% rise in interest rates increases payments by roughly 13% or 14%

That begs the question…

What if both rates and prices increase as predicted?

The report revealed:

“If interest rates and home prices rise by year-end in the ballpark of what most analysts are forecasting, monthly mortgage payments on a new home purchase could increase another 10–15%. That would make 2018 one of the worst full-year deteriorations in affordability for the past 25 years.”

The percent increase in mortgage payments would negatively impact affordability. But, how would affordability then compare to historic norms?

Per the report:

“For the U.S. overall, even if affordability were to deteriorate as forecasted, affordability would still be reasonable by historic norms. That is because the percentage of pre-tax income needed to buy a typical home in 2019 would still be similar to the historical average during 1987–2004. Thus, nationally at least, even with higher rates and home prices, affordability will just revert to historical norms.”

What about home prices?

A decrease in affordability will cause some concern about home values. Won’t an increase in mortgage payments negatively impact the housing market? The report addressed this question:

“Even recent interest rate increases and higher taxes on some upper-income earners didn’t slow the market, as many had feared…Short of a war or stock market crash, housing markets could continue to surprise on the upside over the next few years.”

To this point, Arch Mortgage Insurance also revealed their Risk Index which estimates the probability of home prices being lower in two years. The index is based on factors such as regional unemployment rates, affordability, net migration, housing starts and the percentage of delinquent mortgages.

Below is a map depicting their projections (the darker the blue, the lower the probability of a price decrease):

“Short of a war or stock market crash…” | Simplifying The Market

Bottom Line

If interest rates and prices continue to rise as projected, the monthly mortgage payment on a home purchased a year from now will be dramatically more expensive than it would be today.

Source: Keeping Matters Current

Learn more about the buying process, mortgage programs, Private Mortgage Insurance (PMI) and more.  If you are in the market to buy or sell real estate contact your Century 21 Allstars 100 Real Estate Agent, Steven Batista, today!