A Look Back at the 2011 Real Estate Market

A housing economist recently noted that all our real estate market really needs to right itself is six straight months with no surprises. All the ingredients for a turnaround are there – record low interest rates, outstanding affordability, and very attractive home prices. But economic and political headwinds at home and abroad kept the market from really gaining much momentum this year.

To be sure, 2011 was anything but predictable. On top of the tepid economic recovery here in the U.S., there was one crisis after another around the world – the Japanese Earthquake and Tsunami, the “Arab Spring” uprising, a spike in oil prices, political standoffs on Capital Hill, the debt limit ceiling and downgrade of U.S. debt, and most recently the sovereign debt crisis in the eurozone and the subsequent stock market volatility here at home.

But there was reason for encouragement for our local housing market. Utah’s real estate market did show some positive signs of rebounding this year despite skittish consumer confidence and the sluggish economy.

Existing home sales along the Wasatch Front in October – the most recent figures available – surged 34 percent in October compared the same month a year ago, according to the Salt Lake Board of Realtors. Through the first 10 months of this year sales were up a solid 8 percent compared to the same period in 2010.

“Utah has been somewhat isolated from … the market downturn,” DeAnna Dipo, president of the Salt Lake Board of Realtors, told the Salt Lake Tribune recently. “And now our unemployment rate is going down, which is probably the biggest factor behind the sales increases that we’ve been seeing lately.”

While sales did move higher this year, prices still remained soft. The median single-family home price in Salt Lake County fell to $196,000 in the third quarter, down 15 percent from the same period last year and off 23 percent from the peak of the market in 2007, according to the SLBOR. Other Wasatch Front counties also saw the median decline.

Distressed home sales
One of the reasons for the increased number of sales and declining median price is the mix of home sales continues to tilt toward the low end of the price range. Entry level homes and distressed properties continue to be the lion’s share of transactions in many areas as bargain hunters rush to take advantage of attractive prices and, of course, low interest rates.

One trend we’ve noticed of late is a drop in the number of bank-owned properties that are listed for sale and an increase in short sales. The reason may be that government regulations and controversies over “robo-signing” have kept more foreclosures from coming on the market. As banks put the robo-signing debacle behind them, we may see more REO properties released in 2012.

While the release of additional distressed properties could keep prices of all homes down in 2012, we suspect that strong demand by investors for these homes will probably keep prices from falling much further. We’ve seen multiple offers for many bank-owned properties, sometimes all cash offers, as investors snap up what they believe to be great bargains.

Non-distressed mid-market
Homes that are somewhere between distressed and luxury properties – the bulk of the market here in Utah – probably were the most challenged in 2011. One big reason for the softness is that we didn’t see very many move-up buyers trading their entry-level homes for larger, more expensive properties as they have traditionally done in the past.

Equity homeowners stayed on the sidelines, perhaps due to a lack of confidence in the housing market and the economy in general. They may have been frightened away by doom and gloom news headlines about the housing market, or maybe fear over whether they might lose their job should the economy stumble again.
This uncertainty and lack of confidence, I suspect, will continue to some degree into 2012 until there is more positive improvement in the economy.
But as we approach the new year there are glimmers of hope that the housing recovery could finally gain some traction.

Gradually we’re seeing fewer distressed sales and more “normal” transactions. The high-end market had a solid year in 2011, which is a good sign for the entire market. In the past, luxury homebuyers – the so-called “smart money” – are often the first to declare a market bottom and jump back in because they have the means to do so once they are convinced the time is right. The other segments eventually follow.

Buyers are far more active right now and that, coupled with tight inventories, is helping to firm up pricing while getting serious buyers to be a little more realistic when making offers–especially in the entry-level arena. Properties priced correctly and that show well are getting a tremendous amount of traffic as well as multiple offers in some cases.
Additionally, we are finally seeing many banks starting to process short sales in a more streamlined fashion, allowing us quicker short sale approvals.

Finally, the news media are starting to join the chorus suggesting a turnaround is near and that now is the time to get back into the housing market. A recent Fortune magazine article declared, “Forget stocks. Don't bet on gold. After four years of plunging home prices, the most attractive asset class in America is housing.” And The Wall Street Journal followed with a headline declaring, “It’s Time to buy that House.”

So will 2012 usher in a steady, predictable economic recovery at long last or another wild rollercoaster ride of economic and political surprises? Only time will tell how it all plays out. Fasten your seat belts!

Source: Reality Check, entitled Economic and Political Headwinds Impact Housing Market in 2011

The Perfect Holiday Gift: A Down Payment?

The Perfect Holiday Gift: A Down Payment?

More families may be feeling a little extra generous this holiday season and are offering loved ones help with a down payment on a home.


Coming up with the down payment has become a major obstacle to home ownership, according to a survey by Trulia from September. The survey found that 51 percent of 758 renters surveyed said coming up with the money for a down payment was what was preventing them from buying and 36 percent said qualifying for a mortgage was holding them back.

But with the holiday season approaching, some lucky family members may find a down payment gift under the Christmas tree.

However, if giving a down payment gift, gift givers must remember that “under federal tax law, each individual is permitted to give away money or valuables worth up to $13,000 to a single recipient in a calendar year,” according to an article at The New York Times. “A married couple could jointly bestow up to $26,000 a year per recipient.” Anything above the maximum annual exemption could be considered a taxable gift and must be reported to the IRS.

Source: “Help With a Down Payment,” The New York Times

http://www.debbiecheney.com/

Winter-Selling Tips for Overcoming the Gloom

Winter-Selling Tips for Overcoming the Gloom


Selling a home in the cold, dreary winter months may not be ideal but there’s still plenty you can do to get a home to standout.




“Buyers out looking at homes in December or January are, as a group, quite serious about buying,” Laura Ortoleva, a spokesperson for the RE/MAX Northern Illinois, told RISMedia. “Therefore, sellers tend to benefit because each showing is more productive, and fewer showings are needed to sell the property.”


RE/MAX agents offer some of the following tips when selling a home in winter in a recent article at RISMedia.


Turn on the lights: Counter winter’s cloudy and short days by turning on all of the lights in a home for each showing. “Also, it’s a great idea to keep the lights on in the front of the house even if no showings are scheduled,” says Marlene Granacki of RE/MAX Exclusive Properties in Chicago. “People are always driving past the house, and keeping it lighted makes it look happy and welcoming.”


Have a place for shoes: Prospective buyers may arrive at the front door with shoes coated in snow or salt. “Make it easy for buyers to deal with their shoes when they arrive,” says Barbara Hibnick of RE/MAX Showcase, Long Grove, Ill. “Put a festive area rug at the front door for a great first impression and so visitors can wipe their feet. Have slippers or disposable booties available, along with a bench or chair, if there is room for one, where a visitor can sit and easily remove or put on their boots.”


Watch for odors: Homes can get stuffy in the winter. “Pet odors can be especially worrisome in winter,” says Mike Mondello of RE/MAX Synergy in Orland Park, Ill. “Use a room fragrance if needed, but nothing too strong, and I recommend that in winter sellers clean more often.”


Don’t make it too toasty: “Don’t blast buyers with hot air,” the RISMedia article notes. Keep the temperature at a comfortable 65 degrees during your showings (although keep in mind that a comfortable temperature for your thermostat can vary form house to house.) Potential buyers will most likely be wearing their winter coats when they tour the house so no reason to make them sweat.


Source: “10 Ways to Get the Best of Winter When Selling Your Home,” RISMedia

http://www.debbiecheney.com/

Real Estate and Social Media

How one dumb tweet can cause a real-estate #fail



As people share more personal info online, experts warn not to say too much about a real-estate deal until it's completely done.


by Marilyn Lewis of MSN Real Estate


Pity the poor Tiburon, Calif., homebuyer who shared her real-estate triumph too soon on Facebook. The post went something like: "Found our dream house!" and she named a coveted neighborhood where she'd long been shopping.


"She didn't think anyone but those in her own network, which was quite small, was listening," says Ginger Wilcox, who was her real-estate agent. "Unfortunately, a friend saw the post and shared it with a pal who was looking in the same neighborhood."


The friend of the friend moved quickly. She tracked down the listing and offered more money, snatching the home from under the Facebook poster, who later learned through the grapevine how she'd shot herself in the foot with her post.


The Facebook poster did, eventually, buy another home. This time, she was discreet until the deal was done, Wilcox says.


Wilcox, head of agent training at real-estate website Trulia, uses the story to warn salespeople to tell their clients not to share deal-killing personal details on Facebook, MySpace or Twitter.


Social media are embedded in many people's lives. But as of now, most homebuyers, sellers and real-estate agents are using these sites just to comment and report on their experiences and feelings.


[Click here for the rest of the article]

www.debbiecheney.com

NEW! RealSearch App

I now have my very own Real Estate app....
Have you ever been driving through a neighborhood and wanted to know which homes were for sale and what their price was?   Have you ever wondered how much homes in your area are selling for? 

Well, I have the answer....on your smart phone go to this link: http://agentmobile.mobi/?ccid=322.  Bookmark it on your phone and start searching. Or send a text to 35620, keyword is Debbie Cheney...download the app. 

No more trying to find a website to go to...it will be on your phone!  It is wonderful, so share it with everyone you know!

www.debbiecheney.com

Tax Credits - Get 'Em Before They're Gone!

Home Energy Efficiency Tax Credits to Expire Dec. 31

Home owners may be able to take advantage of several tax credits for energy efficiency home improvements from this year. But they need to hurry: The tax credits are set to expire Dec. 31, and Congress has yet to renew them for 2012.

“Making efficiency improvements this year will lower home energy bills and improve home comfort for years to come, while also reducing 2011 federal income tax bills,” Kateri Callahan, president of the Alliance to Save Energy.

The allowance for the tax credits that home owners may be eligible for include:

•10% of the cost of insulation and sealing materials, exterior doors, and certain types of energy efficient roofs.

•10% of the cost, up to $200, of exterior windows or skylights.

•$300 for electric heat pump water heaters, electric heat pumps, central air conditioners, biomass stoves, and natural gas, propane, or oil water heaters.

•$50 for advanced main air circulating fans.

•$150 for natural gas, propane, oil furnace, or hot water boilers.

For more information about applying for these tax credits, visit the Alliance to Save Energy Web site.

Source: “Last Call for Energy Efficiency Homeowner Tax Credits,” RISMedia

Low Mortgage Rates Keep Housing Affordability High

Great News:

Low Mortgage Rates Keep Housing Affordability High

from REALTOR®Mag  Daily Real Estate News

Friday, December 09, 2011

Mortgage rates continued to be near record lows this week, keeping housing at affordable levels for most households.
 
"Thirty-year fixed-rate loans have declined 0.62 percentage points from a year ago, and median sales prices on existing homes are off 4.7 percent in the year ending with October,” Frank Nothaft, Freddie Mac’s chief economist, said in a statement. “These low rates and home prices have pushed housing affordability to record highs this year.”

Monthly principal and mortgage interest payments accounted for 12.6 percent of a median family incomes in October, Nothaft notes. For the sixth time this year, the National Housing Affordability Index reached another all-time record high, according to the National Association of REALTORS®.

Here’s a closer look at mortgage rates for the week ending Dec. 8.

•30-year fixed-rate mortgages: averaged 3.99 percent, with an average 0.7 point, down from last week’s 4 percent average. A year ago, 30-year rates averaged 4.61 percent.

•15-year fixed-rate mortgages: averaged 3.27 percent, with an average 0.8 point, just slightly above the all-time low of 3.26 percent it reached on Oct. 6. Last year at this time, 15-year rates averaged 3.96 percent.

•5-year adjustable-rate mortgages: averaged 2.93 percent this week, with an average 0.5 point, ticking up slightly from last week’s 2.90 percent average. Last year at this time, the 5-year ARM averaged 3.60 percent.

•1-year ARMs: averaged 2.80 percent this week, with an average 0.6 point, edging up slightly from 2.78 percent last week. A year ago, 1-year ARMs averaged 3.27 percent.


Source: Freddie Mac

http://www.debbiecheney.com/

Weather Damage and Homeowner's Insurance

Recently Northern Utah has suffered damage from high winds.  This might have you thinking about your current homeowner's insurance coverage.  If not, here's an article from Yahoo News that might encourage you to do so...

"A storm can do a lot of damage to a home; whether from wind, snow, hail, lightning or any other weather danger. InsuranceHotline.com reminds consumers to be aware of what is covered under a homeowner’s insurance policy and what is not – as well as the steps each homeowner should take to reduce the chance of weather related damage.

Toronto, ON (PRWEB) December 07, 2011

From winter’s blizzards to summer thunderstorms, the weather can wreak havoc. Some of the most common weather damage claims involve missing shingles, toppled trees and water damage from rain or melting snow. Not every weather damage claim will be covered under the standard homeowner’s insurance policy, however, so it’s important to know the difference.

What Is Generally Covered Under Standard Policies

The coverage under any homeowner’s policy depends greatly on the type of policy that has been selected. The most comprehensive policy in the market will likely provide coverage for the following types of weather damage, with some caveats:

• Lightning

• Wind and Hail (exterior damage only unless the weather caused an opening in the home)

• Damage from Falling Debris (including trees and branches)

• Water damage from rain, only if the storm was responsible for allowing water to enter the home

Remember that damage to the contents of the home is only covered if the policy includes contents coverage; it is important to consider this when shopping for a home insurance quote.

Optional Coverage and Uninsurable Perils

Standard homeowner’s policies do not provide coverage for certain weather related perils; these include preventable issues or maintenance issues and certain predictable weather related items. Homeowners will require optional coverage for earthquake damage. This is separate from standard home insurance because it is a peril specific to the area in which the home is built.

Some items are considered uninsurable perils – this means that there is no coverage available for these items under any policy. These are items considered preventable by homeowners and include:

• Freezing of pipes and resulting damage

• Snow melting or movement

• Landslides

• Water damage for water entering the home due to poor maintenance

Taking Action to Prevent Weather Damage

There are steps homeowners can take to reduce or avoid weather damage. “It is always the homeowner’s responsibility to take action and keep their home as safe as possible,” reminds InsuranceHotline.com’s Tammy Ezer, “Not all weather damage can be prevented, but everyone can reduce the risks.” A home can be kept safe from some types of damage by:

• Taking appropriate steps to prevent pipes from freezing especially in cottages not in use

• Clearing away snow build-up from roofs and areas where snow slides might take place

• Keeping roofs in good condition to stand up to stormy weather

• Awareness of specific dangers in the area where the home is located, such as bodies of water that could flood, and taking appropriate measures

Prevention is always a better choice than filing a claim and having to make repairs, so homeowners should take steps wherever possible to avoid weather related damage. While a storm cannot always be predicted, potential areas of damage can and preparing for stormy weather is the best way to avoid a claim. When comparing home insurance quotes, it is vital that consumers ask about optional coverage and uninsurable perils on the policy."


www.debbiecheney.com

Keeping Your Home Safe For the Holidays (and the rest of the year)

'Tis the season to protect your home from those Scrooges known as burglars. According to HomeSecurity.us, "Most homes are extremely vulnerable to burglaries during the December holidays. The reason for this is simple – families may be traveling or away for long periods of time and homes are usually filled with high value items. However, this in no way means that robberies and burglaries do not happen during other months. According to data from the FBI, insurance companies, and burglar alarm companies, burglars are active pretty much throughout the year...

...Since holidays and vacations are boom time for burglars, it is important that homeowners take preventive steps to protect their house and belongings. Simple steps such as informing close friends or a trusted neighbor and having them keep an eye on the house, notifying the local police about your absence, canceling the newspaper and having an automatic timer for the lights may prove to be deterrents for burglars on the prowl. In addition, one can ask someone to mow the lawn and pick up the mail as well to avoid giving the impression of an empty house."

Check out their whole list of "Tips To Keep Your Home From Being Burglarized".


And here are 10 Quick Security Tips from The Burglary Prevention Council (BPC), "a national organization dedicated to the prevention of residential burglaries":


1.  Keep all doors and windows closed and securely fastened. An open window or door is an open invitation for burglars. Thieves are also quick to spot weak locks that may be easily forced open. Doors should have deadbolt locks with a one inch throw and reinforced strike plate with three inch screws. All windows should have window locks.

2.  Secure sliding glass doors. Place a metal rod or piece of plywood in the track and install vertical bolts. These will help prevent burglars from forcing the door open or lifting it off the track.

3.  Always lock the door to an attached garage. Don't rely on your automatic garage door opener for security.

4.  Create the illusion that you are home. by using timers on lights, radios and TV's. Making your residence appear occupied, even when no one is home, will deter criminals.

5.  Keep the perimeter of your home well lighted. Installing low voltage outdoor lighting is a cost-effective way to discourage intruders, as well as highlight a house.

6.  Never leave clues that you are away on a trip. Have a trusted neighbor collect mail and newspapers while you are away so delivered items do not accumulate. You can also ask a neighbor to park in your driveway or parking place to make it appear that you are present.

7.  Keep some shades and blinds up and curtains open to maintain a normal, everyday appearance in your residence.

8.  Never leave a message on your telephone answering machine telling people that you are away from home. A message that you will return at a certain time leaves your home vulnerable in the interim.

9.  Keep shrubbery trimmed away from entrances and walkways. While large, ornate hedges may be beautiful, they also provide a hiding place for burglars who need only a minute to break in through a window or door.

10.  Organize a community watch program to protect your neighborhood. An alert community is a safe community.