Annapolis Maryland Luxury Real Estate

Real Estate Recovery or Not?
2012 Predictions By the Pro’s Infographic

Data, data everywhere, but what should you believe?  Are we on, in the middle, or at the tail of a deflating real estate bubble?  Is there a Florida real estate bubble?

There is A LOT of conflicting data emerging about the 2012 real estate market and 2012 real estate transactions.  Case-Shiller has emerged as the leading index of real estate values.  The Q4 2011 S&P/Case-Shiller index (1) shows continuing declines in real estate values with quarter over quarter declines of 1.1-1.2% and annual declines of 3.0-3.4%.   RealtyTrac is the leading source of foreclosure data.   On January 12, 2012, RealtyTrac published (2) surprisingly good news showing a 33% decline in the number of homes in foreclosure from 2010 to 2011.   The National Association of Realtors (NAR) Chief Economist Lawrence is projecting a modest 4.7% increase in real estate transactions with a 2.0% increase in real estate values in 2012 vs. 2011.  But, on December 19, 2011, NAR was forced to re-state historical homes sold data (3) due to “upward drift” of their core homes sold benchmarks, which historically have been based on feeds from the multiple listing service (MLS).

So what should you believe?  Nearly all data on real estate transactions and real estate values is historical;  it does not forecast the future and may not reflect the situation in your local market.   Real estate is inherently local, so if the national real estate market is in decline or on the mend, what does that say about your local market?  Does a national real estate bubble portend a Florida real estate bubble? Or a bubble in Fort Myers, or Sanibel Island specifically.

The largest real estate social network ActiveRain Corp surveyed 1,835 real estate agents and real estate brokers in the US and Canada to understand if the real estate market and economy are poised for recovery in 2012, both nationwide and in local markets.

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<p><a href="http://activerain.com/real-estate-values"><img src="http://activerain.com/pdf/FINALhotornot_600px.jpg" height="800" alt="" width="375" /></a></p> <p>Data provided by ActiveRain.com. Join 215,590 <a href="http://activerain.com/real-estate-value">Real Estate Agents</a> on the world's largest Real Estate Social Network.</p>

A Bottom of the American Real Estate Market

American real estate agents expect the US real estate market to be largely flat from 2011 to 2012.  Real estate agents predict that real estate values will be flat from 2011 to 2012, signaling a bottom to the real estate market or the end of the real estate bubble.  Given historically low interest rates as well as a bottoming of real estate values, real estate agents expect that the number of real estate transactions and new construction starts will increase slightly in 2012.   Additionally, real estate agents believe local economies are on the mend and we will see improvements in the economy.

Rental Nation?

With low real estate values, low interest rates and a recovering economy, American real estate agents believe that 2012 is a great time to purchase both single family and multi-family rental properties.  Real estate agents feel that single family homes and luxury homes represent great investment opportunities.   What did real estate agents think are the worst opportunities in the 2012 real estate market?  Due to the glut of inventory in the real estate market due to short-sales and foreclosures, new construction condominiums, new construction single family homes, and land for construction were rated as the worst investment opportunities.

What’s the Problem?  The Banks, Stupid!

When polled about the biggest challenges facing the real estate market and economy, real estate agents rated bank related issues the highest.  The biggest challenges were:  1) short sales, 2) ability to finance a new home purchase / loan qualifications, and 3) foreclosures.  The significant shadow inventory caused by short sales and foreclosures continues to drag on real estate values.  Though interest rates are at historical lows, increased loan qualifications are preventing first time home buyers from purchasing homes and current home owners from trading up into new homes.

We would have expected unemployment to be a greater concern to real estate agent.s  Persistently high unemployment was ONLY the fourth concern to real estate agents, which was surprising given how the poor economy and lack of jobs has dominated the news headlines for the past 24 months.

Local Opportunities, Local Problems

From a local market perspective, the 2012 ActiveRain real estate survey shows markets where real estate agents are significantly more optimistic and others in which real estate agents are concerned about 2012.  Based on our survey data, the ActiveRain real estate network has created a real estate confidence index and ranked the top real estate markets. 

Below is a list of the TOP 10 and BOTTOM 10 real estate markets ranked by real estate agent confidence.

See real estate confidence in your local real estate market.

Key Trends in Top Markets

Low Cost of Living Markets Rule: Low interest rates and low cost of living have attracted buyers and relocations back into these markets.  Even though the general economy is not as robust as anyone would like, home buyers are adjusting lifestyles to find markets with low cost of living and reasonable housing prices.   Applicable markets: Ft. Myers, Austin, Boise, San Antonio, Denver, Dallas, Nashville, Houston, Salt Lake City

Invasion of the Snowbirds: Senior Housing & Second Homes:  Seniors and those planning for retirement have returned to the South.  Seniors are taking advantage of low priced housing inventory in the Sun Belt and low interest rates to buy a retirement home or a second home in a warmer climate.  Many of these buyers have saved for lifetime and 2012 represents a great opportunity to buy while prices and interest rates are low.   Seniors are targeting markets with low cost of living for retirement. Applicable Markets:  Ft Myers, Austin, San Antonio, Nashville, Miami, Salt Lake City

International Buyers:  International home buyers are taking advantage of a weak dollar and low real estate values.  Florida is the biggest beneficiary of international buyer interest.  Miami is reporting strong home purchase market based on International cash transactions.

Deep in the Heart of Texas: No other state has FOUR major cities listed as growth markets.  So what is going on in Texas?  Texas represents exactly what every home buyer should be looking for: low cost of living, low cost housing, and job growth.   Throw in no state income tax and Texas is looking a lot more appealing than California.  Texas is attracting many large corporations to set up headquarters and operations in the state.   This is especially true in Austin.  Finally Texas has a great mix of technology companies AND energy companies (oil & gas and renewable energy).  See below.  Applicable Markets: Austin, Dallas, San Antonio, Houston

Technology and Energy Industries: Even in the current down market, technology and energy are growth industries driving job creation.  Though most think of San Francisco, Boston, New York and Seattle when we think of technology.  Secondary markets participating in technology and energy job growth are likely good real estate markets in 2012, due to low cost of living and high demand for skilled jobs.   Markets: Austin, San Antonio, Denver, Dallas, Houston, Salt Lake City  

Investment Property: Low interest rates, low real estate values, and rising rents due to job growth is a great investment proposition.  A number of the lower cost of living and lower real estate value markets are reporting growth driven by investors coming into the market looking for deals.   Applicable Markets: Boise, Nashville, Salt Lake City, Austin, San Antonio

Key Trends in Poor Markets

High Cost of Living, High Real Estate Values: Though interest rates are historicly low, cities with expensive housing and high costs of living are suffering.  Tightened loan standards are preventing home buyers from entering the market.  Families are relocating to lower cost of living markets.  The high cities with high real estate values are also suffering the most from the shadow inventory of foreclosures and short sales.  Applicable markets: New York, Los Angeles, Chicago, San Diego


California: Californian cities benefited from the greatest price increases during the real estate bubble.  Simultaneously California has suffered the greatest in the downturn with the highest numbers of foreclosures and short sales in the country.  California is also facing a major budget deficit of $XBn leading to reductions in government services, increased class sizes and increased taxes. Applicable markets: Los Angeles, San Diego, Sacramento

High Shadow Inventory:  Large numbers of foreclosures and short sales continue to depress real estate prices in many markets.  It will take several more years for many markets to stabilize.  Buyers continue to wait on the sideline for conditions to improve.  Applicable markets: Reno, Sacramento, Chicago, Springfield, Los Angeles, Philadelphia

High Unemployment:  Persistently high unemployment without an economic catalyst is preventing home buyers from entering the market and locking sellers into their current homes.  Applicable markets: Philadelphia, Los Angeles, New York, Chicago, Sacramento, Reno

Reliance on the Finance Industry:  Downsizing in the banking industry combined with reduction in Wall Street bonuses has caused challenges in markets reliant on banking,   Wall Street layoffs and a lack luster stock market have affected the highest cost markets like NYC most directly.  Applicable markets: New York , Chicago, Los Angeles, Philadelphia

O Canada!

Unlike the United States, Canadian real estate agents are fairly optimistic about 2012.  Canadian real estate agents believe that all core metrics of the Canadian real estate market and economy will be increasing in 2012.  Real estate values, real estate transactions, new construction starts, and the local economy are project to increase slightly in 2012.  Canada continues to have a strong banking system, a strong dollar, and low unemployment.  Interest rates are low, spurring international investment in Canada..  Canadian confidence continues to be high.  Job growth is being driven by the energy industry in Canada.

Few problems are facing the Canadian real estate market or the Canadian economy.  Inflation and gas prices are the only problems that the Canadian economy seems to be facing.  Unlike the US real estate market, Canada any issues with short sales or foreclosures.

Canadian real estate agents feel like single family homes, investment properties for rental and condominiums all represent good investment opportunities, due to historically low interest rates.  Interestingly, Canadian real estate agents are slightly LESS optimistic about real estate as investment opportunity when compared to American real estate agents

ActiveRain Corp is the world's largest network of real estate professionals.  ActiveRain is a social network, blogging and training platform built for real estate professionals, including real estate agents, real estate brokers, lenders, mortgage brokers, title companies, home inspectors, architects, home stages, and contractors.  ActiveRain receives more than 2 million real estate visitors per month.   For more information, sign up for a FREE account on ActiveRain here.

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(1) Q4 2011 S&P/Case-Shiller index

(2) RealtyTrac 2011 Year End Foreclosure Report

(3) NAR Re-Benchmarking of Home Sales

 

 

Everyone has heard rumors of de-cluttering when it's time to sell your home. But, what does that really mean?  Before going hog wild and moving out... here's a few of the most important things to consider removing before you list your home for sale.

10. Personal photos. I don't always recommend removing photos of the 'family' but if you have hallways filled with photos or photos on every end table it is probably necessary. Buyers really DO get distracted by them. They will take them all in as they walk down the hall. Not only do they take away from the home, but it's really disturbing when a buyer is excited to 'know' the sellers. And, the buyers do look at them.

9. Bills and personal papers. I understand that you cannot remove these document from the home all together, but please take the time to organize them, box them up and put them out of sight. If you have bills laying out on the counter or kitchen table it's like an invitation for the buyers to 'peek' at them. Believe me - I discourage it - but it still happens. And as a seller you just don't want to leave the temptation behind.

8. Money. I would love to say that every buyer (and Realtor) going through every home is honest, but I really don't want to test those waters. If you have cash, cash boxes or coin jars sitting out in the open... put them away. It's just better for everyone if it's out of sight. As Realtors we do what we can to protect your home, but your help makes a difference!

7. Valuables. Jewelry, watches, valuable antiques.... anything that might be worth a bit of money that you wouldn't want to lose. Out of sight, out of mind. If buyers don't know they are there they won't think about it. I can't tell you how many homes I've been in where the jewelry is left on the dresser.... somehow it's uncomfortable. At least put it away.

6. Guns and ammo. I don't care if they are in a case or out laying around or under a bed. It's better if you just plain old remove them from the home prior to listing. For some reason they make buyers (in my experience) feel really insecure.

5. Shoes! If you have a pile of shoes at the door... ask yourself why. A pile of shoes gives a buyer two impressions. The first? That there isn't enough storage in your home. 2. That there are too many people living in the home. So, in order to avoid wondering on the part of the buyer... just put them away.

4. Medicine. Take it out. Don't store it on the counter. Don't store it in the cabinet. Don't store it in the bathroom. Remove it. There have been many complaints over the years of potential buyers 'stealing' the medicine out of the cabinets. I have never had it happen on my time clock, but to avoid any trouble it's best to simply remove it.

3. All things on your kitchen counter. Everything? Really? Yup. The cleaner you can leave the counter, the more buyers dream of being in there. Have you ever been in a cluttered kitchen? Does it feel inviting? How about a cleaned up kitchen? Does it make you wanna spend time there? Also, if you store things on the counter it gives the appearance that you do not have enough storage space.

2. No more junk drawers. Seriously. Clean 'em out. There is nothing more tacky than a potential buyer opening the cupboards and drawers and having things sticking out everywhere. Box up all the notes, pens, tacks, and odds and ends and put them away. Chances are you don't dig in the drawer often anyways.

1. Nothing but magnets.... and maybe not even that. Take a photo of your fridge, take everything off, wash the front (and side), and take another photo. It is really refreshing to walk into a home that has a clean fridge. The kids pictures are beautiful (believe me... my fridge is covered in them) but buyer's can't imagine their own children's drawing on there if it is covered with yours. And, the magnets... If they aren't decorative (and even then) they are generally more of a distraction to the room than a help. Consider it.

There are many more ways to declutter a home for sale... but these are some important things to consider. For more information on selling your home in Minnesota... give me a call.

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                 In the meantime... if you are looking to move into the area... I'll wait for you to call!

Selling Real Estate in Minnesota!

If you are looking for professional real estate services I am only a ring away! I am looking forward to working with you. And, please feel free to share my name with anyone that you know who needs assistance buying or selling a home ~ I love referrals!

                                                   Lindsey Hasford, REALTOR
                                                        Coldwell Banker Vision
                                             231 Main Street - Elk River - MN 55330
                                          763-241-5488 (office)  763-218-1347 (cell)
                                           lindseyhasford@coldwellbankervision.com
                                                  http://www.hasfordhomes.com