Category Archives: Market Conditions

Buyer’s VS. Seller’s Market in 2015

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Buyer’s VS. Seller’s Market in 2015

Brief Reference to conditions of an ever-changing Real Estate Market in Year 2015 – Richmond, VA

 

The housing marketplace is a pendulum that is constantly moving. The buyer/seller advantage may not be as it appears, and will vary with location, which is not unusual.

 

Conditions changed several times during the course of 2014; as the market improved, buyers and sellers were anticipating the home sales to favor sellers, but it subtlety changed to favor buyers late in the year. This seems to have happened in spite of generally low inventory in the resale market. Conservative purchasers were taking their time when considering what to buy, and have not turned out in high numbers in order to favor sellers.

 

Slow to get started in 2015, the general forecast for the overall real estate market is positive for projected sales, although modest in terms of value increases.  It is still early in the year, but a noticeable uptick in activity is present in the marketplace. Hang on, things could start moving at a rapid pace very soon – we are on the cusp of the spring market. Improved consumer confidence, pent-up demand, low mortgage interest rates, and new homes coming on the market are a good recipe for activity.

 

DEFINITION OF ‘BUYER’S MARKET‘

  • A situation in which supply exceeds demand, giving purchasers an advantage over sellers in price negotiations. Buyer’s Market is commonly used to describe real estate markets, but it applies to any type of market where there is more product available than there are people who want to buy it.
  • The opposite of a buyer’s market is a seller’s: market a situation in which demand exceeds supply and owners have an advantage over buyers in price negotiations.

 

INVESTOPEDIA EXPLAINS ‘BUYER’S MARKET‘

  • During the housing bubble of the early-to-mid 2000s, the real estate market was considered to be a seller’s market. Property was in high demand and was likely to sell even if it was overpriced or not in the best condition. In many cases, homes would receive multiple offers and the price would be bid up above the seller’s initial asking price.
  • The subsequent housing market crash created a buyer’s market in which sellers had to work much harder to generate interest in their properties. Buyers expected homes to be in excellent condition or priced at a discount and could often secure a purchase agreement for less than the seller’s asking price for the property.
  • In this analysis, a sellers’ market is not necessarily one where home values are rising, but rather one in which homes are on the market for a shorter time, price cuts occur less frequently and homes are sold at prices very close to (or greater than) their last listing price.
  • In buyers’ markets, homes for sale stay on the market longer, price cuts occur more frequently and homes are sold for less relative to their listing price.

 

Zillow Blog:

  • “In general, buyers in sellers’ markets this spring can expect tight inventory, increased competition and a greater sense of urgency.
  • Sellers in buyers’ markets may need to be prepared to lower their asking price, or to wait longer for the perfect buyer to come along.
  • As we put the housing recession further in the rear-view mirror, the broad-based dynamics that applied during those days, when all markets were reacting similarly to nationwide economic conditions, are fading.
  • Real estate has always been local, and as the spring market gains momentum, this old adage will only become more pronounced.”

(2015 Blog; Zillow Chief Economist Dr. Stan Humphries.)

How Do I Know What’s Happening In The Real Estate Marketplace?

Fall

 

We can feel it, we can see it, and by tracking recent office numbers Realtors® can anticipate that while home sales have been moving slightly slower during the last couple of months, things were already beginning to swing back, upward in September. Office sales activity is the first indicator for what the marketplace is doing, weather slowing or quickening. We know because we watch the “board”. While statistics supporting this perceived upward trend will not be available for a few more weeks, toward the end of October for September stats, the real estate market is currently performing as has been predicted by such notable economist as Laurence Yun, Chief Economist for the National Association of Realtors.

 

Real estate has been strong this year, but it may feel a little flat compared to the obvious recovery we experienced last year. Nevertheless, interest rates remain low, and statistics reported by the NAR confirm the market remains positive. The NAR states “the national median existing-home price is projected to grow between 5 and 6 percent this year and 4 and 5 percent next year.” This is all really good news in what is considered to be a stable housing market, and Realtors® know it!

 

Everyone knows the stability of the housing market is a key ingredient to consumer confidence and an improving work force. But as they say on TV, “yea, well, did you know that . . . ” a stable housing market does not lend itself toward a buyer or seller market? In other words, purchasers are still rather picky about the homes they select, and don’t appear to be in a terrible rush to make a decision about buying a home; conversely, sellers have the pleasure of enjoying modest inventory selections which boosts demand, but prices must still be compelling for a quick sale, and condition of the property needs to be such that most purchasers don’t feel they are taking on a renovation project. Why?

 

One of the benefits of a good, stable housing market is it lends itself to a feeling of equilibrium of forces, where neither one side nor the other feels they have the upper hand and are being taken advantage of during the transaction. Buying and selling a home is a lot of hard work, both emotionally and physically; nobody wants to feel trampled or defeated during the process. Guidance and understanding during the process is why vast majority of people choose to work with real estate professionals. That’s why, aside from being experts in their field, Realtors® make the time to know the market, understand the needs of the consumer, and have a pulse on market activity that they can sense the ups and downs taking place before the numbers can be calculated – all of this for the benefit of you, the housing consumer.

 

John VanderSyde is a Licensed Real Estate Broker and a Licensed Architect; he and his wife Ann are the top producing team at Virginia Properties, a Long & Foster Company in Richmond, VA.

Fewer Unemployment Claims Filed – For The Week Ending May 3rd

  • Fewer workers claimed unemployment insurance in the week ending May 3, an early indicator that the job market continues to improve surely even if slowly. Initial claims for unemployment insurance[1] were at 319,000, fewer by 26,000 from the previous week’s level.

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  • Claims are now down to their normal levels. If this trend continues, NAR forecasts about 2 to 2.5 million net new job creations this year and the next year.
  • For the week ending April 26, the largest decrease in claims were in Michigan (-6,642), New Jersey (-2,269), Pennsylvania (-1,704), Maryland (-1,670), and California (-1,237).  The largest increases in claims New York (+23,523), Massachusetts (+3,983), Rhode Island (+1,080), Oregon (+959), and Delaware (+956).

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  • Still, what matters to housing is the number of people with jobs as depicted in the graph above. Although the unemployment rate has been dropping with the April rate at 6.3 percent, the share of the population that is employed has barely nudged at 58 percent from its peak of about 63 percent. In a testimony before Congress yesterday, Federal Reserve Board Chairman Janet Yellen reported that labor market conditions are “far from satisfactory” and that “housing may be stalling and bears watching.”  Existing home sales are hovering at about 4.6 million in 2014, down from last year’s average of about 5 million.

 

Information provide from the National Association of Realtors.

REALTORS® Expect Modest Price Growth in Next 12 Months

REALTORS® Expect Modest Price Growth in Next 12 Months Based on March 2014 REALTOR® Survey

REALTORS® generally expect prices to increase over the next 12 months at a modest pace with a median expected price increase at about 4 percent, according to the latest REALTORS® Confidence Index. Low inventory compared to demand is expected to continue to buttress prices, as well as the declining share of distressed sales in the market.

The states with the most upbeat expected price increases of 5 to 7 percent are California, Oregon, Nevada, Georgia, Florida, and Hawaii (red). In states with booming economies like Washington, North Dakota, Texas, Michigan, the DC-Metro Area, and NY, the expected price increase is about 3 to 5 percent (orange). In the rest of the states, the expected price growth is less than 3 percent (blue)

For the Full Article go to:

http://economistsoutlook.blogs.realtor.org/2014/04/29/realtors-expect-modest-price-growth-in-next-12-months-based-on-march-2014-realtor-survey/

VAR STATS – PRICING, LISTING & MARKETING A PROPERTY

News Paper - RealEstateResearch released from the Virginia Association of Realtors (VAR) showed 95 percent of consumers who bought a home started their search for the property on-line (Statistics from the NAR are slightly higher) . Catching those buyers attention requires your listing have the right price, the right selling tools, and a plan for getting the product to market.

The best information and results comes from those Realtors who are experienced, knowledgeable and reliable. Ann & John VanderSyde have what consumers need to buy and sell the best homes throughout the Richmond Metropolitan Areas.

Please Review information at www.InSydeHomes.com and contact Ann or John to find out what is happening in your area now.

 

Ann & John are the top producing Team at Virginia Properties/Long & Foster since 2009, and are both Associate Brokers – 18 combined years of Team experience!

Where are all the homes – what’s up with Inventory?

We have a number of people asking about housing inventory, wondering why we are not seeing more homes in the real estate market for sale. Reports and statistics confirm an improving housing market, although it may be “slow and steady” as reported two weeks ago by Carol Hazard in the Richmond Times Dispatch. So shouldn’t we be seeing more houses for sale?

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We are on the cusp of our spring market here in Richmond, and therefore anticipate seeing more and more homes trickling into the marketplace. However, it may not be what we are used to when we contemplate a healthy marketplace. We have to keep in mind that as the economy continues to evolve the marketplace also shifts. People are often slow to respond to change, and there is still perceived uncertainty in the minds of some consumers as to how these improving conditions will impact home sales. Well don’t think about it too long. Homes are selling more quickly today, and inventory is not keeping up with demand.

 

Realtors are seeing homes showing up “For Sale” and then “pending” under contract rather quickly every day. And for good reason – there is pent-up buying demand fueled by low interest rates which makes this a great time to buy and sell homes. We can all see that low mortgage rates combined with low inventory is a win-win situation for buyers and sellers. Under these conditions, sellers know that homes priced well that are in good condition sell quickly and at a higher price. Buyers understand the value of borrowing with low interest because it allows them to purchase more home for their money, and enjoy a greater return on their purchase over the life of the loan.

 

While “slow and steady” may be the rallying cry of the day, to hesitate may mean not getting what you want. Although inventory may be low, so are the rates available for borrowing the money to purchase these homes. There is no question that this is a great time to buy and sell real estate. Speak to your real estate professional today and find out how these conditions will work to your advantage.

 

Ann & John VanderSyde are Associate Brokers at Virginia Properties, a Long & Foster Company. They have been Sales Team of the Year since 2009. Call (804) 287-4660 and visit   www.InSydeHomes.com

Is a Realtor’s Guidance Reliable in a changing Real Estate Market?

 One of the most difficult times for buyers and sellers to make informed decisions on pricing, or making or responding to offers, is during perceived variations in the Real Estate market. It is relatively easy for Realtors to guide buyers and sellers when there is consistency in the marketplace. It’s a bit more of a challenge to gauge changing trends when things are in flux. As in all aspects of life, there is often a sense of uncertainty when things are moving away from what had been the norm, as seems to be true today.

  The answer is “Yes”; rely on your Realtor during these ever-changing times. Statistics confirm that sales are on the rise, and despite the knowledge that these changes are being compared to the “down market” of last year, these numbers will most assuredly continue to rise. These statistics support the rally-cry of economist who are carefully monitoring the new horizon of future housing improvements. Your Realtor is the one closest to the daily action, and can respond most knowledgably to your questions and housing needs.

  The latest numbers also convey to buyers that it remains a good time to purchase a home. All reports predict, if not confirm, that interest rates will remain low, making it extremely affordable to borrow money. And even though inventory is relatively low, it remains, at least for the moment, a “buyer’s market”. As for Sellers, well they are currently offering housing products at realistic prices. In many cases homes are presented in move-in ready condition, and often with numerous upgrades. Furthermore, the terms and conditions negotiated through the aid of a Realtor ensure that both parties will reach their common goal of buying and selling a home.

  There is little doubt that we are going to continue to see positive trends of change in the housing market. By all accounts, when moving forward, we will enjoy a very different real estate experience than we have come to expect during the last several years. While change is not easy to grasp, the best source for reliable housing information continues to be from the Realtors who are in the market every day. Realtors have their fingers on the pulse of buying and selling homes, even when it happens to be an irregular pulse.

 

Ann & John VanderSyde – Virginia Properties “Sales Team of the Year” (804) 287-4660   www.InSydeHomes.com

Foot Traffic Relates to Home Sales

Richmond Real Estate Foot-traffic in August Can Be a Test in Patience

Typically August is one of the slowest months of the year for real estate activity, followed closely by December.  Vacations and back to school activities obviously rival the December holidays. As a result, less foot traffic means less activity.

Understanding that we know the people who are out looking for homes is going to be fewer in August, you would think we would be prepared for the resulting activity. This lack of activity is reflected in the number of people actually out searching for homes this time of year. We would like to believe that those folks out searching for homes are very serious about purchasing one. Unfortunately it doesn’t always translate into website hits or open house traffic or home sales. Therefore, patience is the key.

According to SentriLock, LLC, Foot traffic and future home sales have a strong correlation. NAR research with monthly data on the number of showings supports this notion. Just try relating such figures to the sellers whose listings you have on the market and see how supportive your clients suddenly become. Nevertheless, it is a fact.

Foot traffic from this year to last year in August will likely be the same for our area of Richmond, VA. The Richmond Association of Realtors will support this idea once their figures come out in September. Although foot traffic will be slow, the sales activity will likely be up slightly this year. The market slump is behind us and mortgage rates remain low. There are still deals to be made and it remains a buyer’s market – for now.

So keep being patient, the fall market in Richmond is almost upon us, and foot traffic will be on the increase. Low mortgage rates and tightening inventories are drawing more potential buyers into the market as confidence in price stability and stable employment grows. Keep your hat on; real estate and new-homes construction are going to experience significant change in the coming year. Tell that to your clients!

 

John VanderSyde is a Licensed Real Estate Broker and a Licensed Architect. He has been in construction, development and building since 1986, and a Realtor since 2002. He and his wife Ann are team partners at Virginia Properties, a Long & Foster Company in Richmond, VA.

Spring and the Marketplace – What’s Different this Year?

   I’m looking at the Weekend Section of the newspaper. There is a lot of information about the latest market conditions, news beyond the bust, and interests in the “home” trending upward.  There is a resurgence of advertisement, upbeat statistics, and the pleasing optimism that aligns itself with improving real estate conditions. It is the blush of spring, where new homes for sale honestly reflects the time of year when fresh and new is sincere and hopeful. It is distinctly different than what we have been experiencing over the last several years, and it is notable.

   None of this can happen without the eager participation of buyers and sellers! Open house dates are spinning with activity, full of sincere purchasers looking at the “home” as something more than just an investment. They are remembering that homeownership is about choosing a lifestyle, as well as a standard of living, that suits one’s particular needs. It is the notion that “location, price and condition” are more than simply buzz-words and market hype, and that people really want to live where it matters most to them.

   The relevance of investors doesn’t adequately describe the true nature of their contribution to the marketplace. The National Association of Realtors (NAR) reported that 27 percent of all real estate transactions in 2011 were for the purchase of an investment property, and that 11 percent of all real estate transactions last year were second home purchases. A significant portion of these transactions were paid for with cash, which further supports the idea that many buyers are investing in a lifestyle, and not just their bottom line.

    There is no doubt a science to real estate, but it doesn’t overshadow the complementary feelings and emotions that go into buying and selling homes. People know this, and it is eminently apparent that we are currently enjoying a little more of the latter during this rather delightful time of year. This is of course the notable difference from recent past years in real estate. Let’s choose to keep looking forward; because after all that’s where the future is – for all of us!

 

John VanderSyde is an Associate Broker, REALTOR with Virginia Properties in Richmond, VA (804) 282-7300

Rising Trends, Improving Conditions in Real Estate

If you don’t think things are changing in the real estate housing market, well think again! It’s easy to get caught up in media reports the most recent real estate market statistics that point to improving sales conditions in the Richmond Metropolitan area and believe home sales are getting better. After all, it’s just more of the cautious optimism that’s been keeping us going for the last three or four years, right? On the other hand, recent activity indicates genuine change has arrived. Of course some areas will lag behind others as the market picks up, but Realtors can sense the new mood wafting across the plains.

Market activity has been on the increase since at least November 2011. Our individual numbers as well as every stat tracking real property transfers confirms it. Nevertheless, real estate professionals have been cautiously monitoring trends to see if conditions were actually improving, or if perhaps this was simply another market teaser. It is one thing to watch the numbers reportedly go up, but quite another to see actual behavioral change.

Just last weekend we called to schedule an appointment to visit a home in the west end of Richmond. There were so many appointments we could not be accommodated. It didn’t matter that we were willing to wait another day to see it because the seller received so many contracts on the first day they discontinued showings and agreed to work with one of the offers submitted the first day. WOW! You might say this is just one story, but it’s not. We are hearing about other interactions similar to this where multiple offers have been generated. But of course the good ones will always sell fast!

This may not be the norm, but it most assuredly points to distinctive change in the attitudes of people ready, willing and able to buy a home. With dwindling inventory, improved market conditions, historically affordable interest rates, I would not be surprised to see more interesting stories like this one that point to a changing real estate market for 2012.

 Ann & John VanderSyde, Associate Brokers – Virginia Properties, A long & Foster Company “2009, 2010 & 2011 Sales Team of the Year” (804) 287-4660   www.InSydeHomes.com  “HOME is a Lifestyle Choice!”