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First-time Buyers Increase, Home Sales Climb Nationwide

by Joanne Hiller

First-time buyers represented 32 percent of the market in May, a 2 percent increase from April and a 5 percent increase from a year ago. First-time buyers haven't had this much of a presence in the housing market since September 2012. Unemployment is down among young adults, and many lenders are lowering their down payment requirements. These factors combined with more affordable mortgage insurance options are enticing many first-time buyers to leave their rentals and purchase homes. Economists with the National Association of Realtors (NAR) believe that the number of first-time buyers in the market will continue to rise. The percentage of these buyers will depend, however, on how fast mortgage rates and home prices climb.

Fewer Investors
While first-time buyers saw opportunity in the improving housing market, investors saw fewer deals. Individual investors purchased just 14 percent of all homes sold in May, a drop of 2 percent from a year ago. For the third month in a row, all-cash transactions accounted for 24 percent of all homes sold, down from 32 percent a year ago.

Demand Exceeding Supply
In May, housing inventory was up slightly because more homeowners put their houses on the market. Total housing inventory rose 3.2 percent to 2.29 million existing homes for sale. The housing supply is 1.8 percent greater than it was a year ago. At the current sales pace, this level of inventory represents a 5.1 month supply. Despite the modest increase in inventory, demand still far exceeds supply. On average, homes in May stayed on the market for 40 days. This is the third shortest time recorded since NAR began tracking this statistic in May 2011. The inventory shortage led to an increase in home prices. So not only was May the 39th month in a row to record year-over-year price gains, but every region in the country saw home prices increase.

Sales Climb Nationwide
In May, all regions of the country experienced sales increases. The Northeast posted the largest gains with existing-home sales jumping 11.3 percent, for a total increase of 11.3 percent from a year earlier. In the Midwest, sales climbed 4.1 percent month-over-month and an impressive 12.4 percent year-over-year. The South and West both saw an increase of 4.3 percent from April. When compared with May 2014, sales were 6.9 percent higher in the South and 9 percent higher in the West.

3 Methods Appraisers Use to Find Value

by Joanne Hiller

An appraisal is frequently viewed as an inconvenience and a "nuisance" cost, but if you are buying, selling, or refinancing your home, an appraisal will likely be required. Here are three methods appraisers use to find your home's value.

1. Sales Comparison
To develop this analysis, the appraiser will research sales of other houses (known in the industry as "comparables") that have recently sold in the neighborhood. From these sales, the appraiser will find the sale price for your home. When properly developed, this analysis will take into account differences (such as age, condition, location and design features) between your home and the comparables. The sales comparison approach is used in virtually every house appraisal and is usually the most reliable indicator of market value for a single-family residence.

2. Cost Approach
In this analysis, the appraiser estimates the market value of your house by estimating how much it would cost to build a replacement―in other words, how much it would cost to buy a lot and build a similar house. The appraiser's calculations will take into account any depreciation associated with your house. If your house is 20 years old, it will be worth less than a brand new house of similar size with similar features in the same neighborhood. The cost approach is best suited for newer houses that have modern features and design and less reliable when estimating market value of an older house that may have significant depreciation or functional inadequacies.

3. Income Approach
In this analysis, the appraiser develops an opinion of market value by estimating how much income your house would generate if rented out at a typical "market rent." This income is then converted into an estimate of value based on the ratio between value and income. The appropriate ratio is derived from local market transactions. The income approach is most useful when the house being appraised is in a neighborhood where houses are frequently rented and where houses are acquired by investors.

The sales comparison approach is almost always used to appraise single-family homes and is usually the most reliable method. You can expect your appraiser to rely on this technique, which may be supplemented by the cost or income approach.

At the end of February, 1.89 million existing homes were available for sale on the market, a 4.6-month supply at the current sales pace. Inventory was down 0.5 percent below last year. This shortage of housing stock helped to drive price growth to its fastest pace in a year. In February, the median existing-home price reached $202,600, a climb of 7.5 percent from last year. For the 36th month in a row, home prices have increased year-over-year. What's more, every region of the country saw an increase in home prices. Median prices in the Northeast and West were up 3.3 percent and 4.2 percent from last year's prices. In the South, prices climbed 8.5 percent above February 2014. The Midwest saw the biggest gains, with home prices 8.8 percent higher than a year ago.

 

Rising Home Prices Will Affect Renters
A lack of inventory can negatively affect home sales, as can higher home prices. Homeowners benefit from the growth in housing prices, since higher prices lead to more home equity. But the more prices climb, the more difficult it is for new buyers to find a home they can afford. Income growth has not kept pace with typical rent rates; over the past five years, rents climbed 15 percent, but the average income of renters rose only 11 percent. With rents continuing to climb in some areas of the country, the gap is expected to widen to unsustainable levels, which will make it more difficult for renters to transition to homeowners. Fortunately mortgage rates remain near 2015 lows. For the week ending April 16, the 30-year fixed-rate mortgage (FRM) averaged 3.66 percent. Last year, the 30-year FRM averaged 4.27 percent.

National Home Sales Increase
Nationally, existing-home sales increased 1.2 percent in February. Sales climbed 4.7 percent higher than a year ago, marking the fifth consecutive month sales have risen above year-over-year totals. The Northeast was the only region of the country to see existing-home sales drop month-to-month, by 6.5 percent; sales were still 3.6 percent higher than a year earlier. In the Midwest, sales were stagnant from January but 4.9 percent above last year's sales. The South and the West, meanwhile, reported only gains. From January to February, existing-home sales were up 1.9 percent in the South and 5.7 percent in the West. Compared with a year ago, sales in the South and the West climbed 6.0 percent and 2.8 percent, respectively.

6 Traits of Successful Home Sellers

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6 Traits of Successful Home Sellers

The goal for any home seller is to sell a property quickly at the best price for the market. Here are six characteristics that will help home sellers succeed.

1. Realistic Expectations
Real estate agents do not pluck listing prices out of thin air. Every price range they recommend to potential home sellers is the result of meticulous research: of the property, the neighborhood and the current real estate market. Most of the factors that affect a property's saleability―location, interest rates, the local job market―are outside the seller's control. Other things, such as the condition of the home and how it is presented, are within the seller's control. Highly effective home sellers address the things they can control and accept the things they cannot. You might not like what the market is saying, but it doesn’t lie.

2. Flexibility
A flexible home seller is open to suggestions. Listen to your agent and heed his or her advice regarding pricing the home for sale, marketing the property and making it show ready. Flexible sellers are prepared to lower the price if they are not getting any showings. Flexible sellers are prepared to stage and remodel the home if they are getting showings but no offers. Delaying a sale by being inflexible can cost you money in extra mortgage payments.

3. Detachment
Homes sell faster when the seller stops thinking about the property as his home and starts thinking about it as product to be packaged for sale. Sellers who find it hard to emotionally detach from the home often sabotage viewings or reject offers, because they are not ready to leave their home. Be honest with yourself. If you are not ready to sell, don't. If you are, then pack up your emotions and accept that it is time to move on.

4. A Big Picture View
Giving way on price is not the same as giving way on the deal. Effective sellers think about all aspects of the deal. A seller who wants to move quickly may be prepared to lower the price in return for faster closing. Requests for repairs, no matter how galling, should be carefully scrutinized. Would you really want to lose a buyer over a $200 repair bill?

5. Availability
Selling your home is a time-consuming business. You must be available to speak to your agent and make urgent decisions concerning the list price, marketing strategies and any offers that come in. Remember, you can't sell a property if would-be buyers can't see it. Make sure that buyers can view your home at all reasonable hours. No showings on weekends might suit your lifestyle, but it certainly won't suit your buyers.

6. Learning
You don't need a degree to sell your home, but you do need a clear understanding of the home selling process. Sellers who understand how home sales work have a clearer idea of the hurdles buyers must jump to purchase a home and can better pre-empt a buyer's needs. Figure out what escrow means and what happens between the contract and closing. Speak to your agent. Ask him or her to fill you in on the local market, the lending environment and the types of things that buyers are looking for in your neighborhood.

Inventory Drops and Home Prices Continue to Increase

by Joanne Hiller

In December, the total housing inventory dropped 11.1 percent. There were 1.85 million existing homes on the market, which is a 4.4 month supply at the current sales pace; in November, there was a 5.1 month supply. With the strengthening economy and sub-4 percent interest rates, the demand for homes from buyers should be increasing, but a tight supply of homes available for sale could cool that demand.

Supply shortage causes home prices to increase. And according to the National Association of Realtors' economists, home prices and rents are outpacing wages, making it difficult for buyers to save for a down payment. The national median existing-home price reached $208,500 in 2014, the highest it’s been since 2007, and a 5.8 percent increase from 2013. What's more, every region of the country saw home prices increase. In the Northeast, prices rose by 3.2 percent from a year earlier, while the Midwest reported a climb of 5.3 percent. Prices in the South increased 6.6 percent from December 2013, while in the West, prices were up 5.6 percent.

Home Sale Numbers
December closed out the year with 5.04 million sales, a 3.5 percent increase from December 2013. December was also the third month in a row where sales climbed above year-over-year levels. However, sales for all of 2014 were still 3.1 percent below 2013. Existing-home sales were up in the West in December; sales climbed 9.8 percent month-over-month and 2.8 percent year-over-year. The South also saw gains in their real estate market, with sales climbing 3.8 percent from November to December and 7.4 percent from a year earlier. Existing-home sales fell in the Northeast by 2.9 percent, but the news wasn't all bad as sales are still 3.1 percent higher than a year ago. In the Midwest, sales declined both month-over-month and year-over-year, falling 3.5 percent and 2.7 percent, respectively.

First-time Buyers Decline
The number of first-time buyers making purchases last year fell to the lowest level in almost three decades, according to a NAR survey. For all of 2014, first-time buyers accounted for 29 percent of the market, tying their percentage for 2013. In December, first-time buyers represented 29 percent of all buyers, down from 31 percent in November but up from 27 percent in December 2013. Economists with NAR are optimistic that first-time buyers will be better represented in the market in the coming year. The Federal Housing Administration recently reduced annual mortgage insurance premiums, which will make buying a home more affordable for new homebuyers.

Positive Signs from the Housing Market

by Joanne Hiller

The national housing market is continuing to stabilize. According to Freddie Mac's Multi-Indicator Market Index (MiMi), half of the markets across the country are showing positive gains. While the national MiMi value of 74.4 indicates a weak housing market overall, the index posted a 0.51 percent improvement from August to September. Year-over-year, the index is up 3.68 percent. Since the market's all-time low of 59.8 in September 2011, the market has rebounded 24.4 percent.

More Construction
The National Association of Home Builders/Wells Fargo Housing Market Index is on the upswing as builder confidence climbed four points on the index to 58. Builders are more confident in today's market because consumers are more confident. Low interest rates, reasonable home prices, and an improving job market make home buying not only an attractive option but a viable one. As a result, builders are seeing more committed buyers walking through their sales centers and signing contracts. The news is welcome after the slow start to 2014. For the past five months, the HMI has stayed north of the 50-point mark. Economists with the NAHB expect builder confidence to continue to climb in the new year.

How Low Can They Go?
At the beginning of December, mortgage rates dropped to the lowest levels of the year. The 30-year fixed-rate mortgage fell to 3.89 percent, the lowest rate posted since May 2013. At the same time last year, mortgage rates were 4.46 percent. Economists have long maintained that mortgage rates will increase, and they predict that rates will climb to five percent by the end of 2015.

Good News for Most
For the second straight month, existing-home sales rose in October. According to the National Association of Realtors, existing-home sales climbed 1.5 percent to a seasonally adjusted annual rate of 5.26 million. For the first time in a year, sales are above year-over-year levels. Most areas of the country experienced gains in sales. In the Northeast, existing-home sales rose 2.9 percent month-over-month and 4.4 percent year-over-year. Sales climbed 5.1 percent in October in the Midwest, a 2.5 percent increase over October 2013 sales. The gains continued in the South, where sales jumped 2.8 percent from a month earlier and 5.3 percent from a year earlier. Only the West posted a drop in existing-home sales. Month-over-month, sales declined 5.0 percent; when compared with October 2013, sales are down 3.4 percent. NAR economists believe existing-home sales will continue to improve. Low interest rates, stabilizing price growth, and an improving housing supply should convince buyers that now is the right time to purchase a new home.

From Casual to Fine Dining - Local Clearwater, FL Restaurants offer Delicious Cuisine

Conveniently located on Island Estates, you have waterfront dining at Island Way Grill, which offers Pacific Rim Cuisine, or enjoy a more casual atmosphere at Island Way Café or Windward Bar & Grille.

Only 5 minutes away you have the vibrant restaurants of Clearwater Beach. Popular beach restaurants include Clear Sky Cafe, The Brown Boxer and the nationally known, Frenchy’s Café with five different locations each offering a unique décor and atmosphere. Other restaurants include Watercolours, The Beachcomber and fine dining at Caretta on the Gulf and beachside Tate Island Grill located in one of the most luxurious 5-star resorts on Clearwater Beach, The Sand Pearl.

Travel 15 minutes north to Dunedin, FL which has some the top-rated restaurants in the country; most are located in Downtown Dunedin. For fine-dining, Mediterranean flare, enjoy an indoor or outdoor setting at The Living Room. For mouthwatering, unique southern BBQ, with a dog-friendly outdoor patio, visit the Smokehouse. For Waterfront Dining at Surprisingly Affordable Prices visit Bon Appetit or their sister restaurant in downtown, Café Alfresco. There is even a homemade ice cream parlor, Strachan’s,  offering 15+ ice cream flavors and novelty desserts like chocolate covered Key Lime Pie, Grasshopper Pie and Cobblers.  Other restaurants include an exclusive fine dining restaurant, The Black Pearl and a fabulous sea food restaurant, Sea Sea Riders.

View a complete list of local Restaurants.

The Island Estates, Clearwater Beach, FL market will be heating up, as not only have sales risen this week to 12 homes sold over the last 30 days, but there is a new upward trend of new listings, with 22 going live in the same time frame. Be the FIRST TO KNOW about new listings for your dream home by clicking this link http://islandestatesrealty.idxbroker.com/idx/search/basic.

5 Financial Fitness Habits to Begin in the New Year

by Joanne Hiller

While many people focus on personal health goals in the new year, the beginning of the year is also a great time to check your financial fitness. So how can you whip your finances into shape?

South University College of Business, Virginia Beach faculty member Dr. Alan Harper says everyone should adopt these five financial habits in 2015:

Establish a budget
Harper says the first step in taking control of your finances is to establish a budget. "It is extremely important to know how much money is coming in, where it's going, and allocating it appropriately," he says. "Having a budget allows you to gain a broader understanding of your spending habits."

Make sure your budget includes allowances for food, clothing, gas, and even entertainment, Harper advises.

Start saving
Your budget should also include money set aside for emergencies. Harper says the old rule-of-thumb that three month's salary is enough to have in your bank account no longer applies in our current economy.

"We found in the last recession that people who lost their jobs tended to stay out of work much longer than three months," he says. "You should have six months to a year's worth of income in savings, just in case."

Harper says you should also try to put away 15 percent of your take-home income toward your retirement. Many retirement savings options are available, including 401(k)s, Roth IRAs and individual retirement accounts. It is important to do your homework before deciding on a long-term investment strategy so that you are aware of terms, conditions and any fees associated with your options.

Manage your credit
The beginning of the year is a perfect time to check your credit history, and to look for any mistakes on your credit report, Harper advises. Mistakes on your credit report can cost you large sums of money in interest rates, or even keep you from being approved for a loan.

"The law requires the three major credit reporting agencies to provide you with one free credit report a year," Harper says. "Pull those reports and look for discrepancies. If you find one, file a dispute with the credit reporting agency and they will remove the item if it is incorrect."

Harper also says to check your FICO score on the report, make sure you have an understanding of what the score means, and how to improve it if the score is low.

Shop smart
Make it a priority to save money while you shop, Harper says. He encourages clipping coupons, and says purchasing membership cards to discount stores like Sam's Club and Costco can help you save money over time.

"Those stores will save you money in the long run on purchases like food, gas, and even personal care items."

Check your insurance
Setting aside time at the beginning of the year to check your insurance policies can also save you money. Harper advises that you should review your auto, home and life insurance to make sure you have the proper coverage.

"You want to make sure you aren't paying for coverage that you may no longer need, but you also want to make sure you have adequate coverage in case there is an accident or you need to make a claim," he says.

Many companies also offer discounted rates if you hold multiple policies with them. So, if your auto, home and life insurance policies are with different companies, you may want to explore the benefits of choosing just one company.

"It's also important to make sure your life insurance policies are sufficient to protect your family from a financial crisis in the event that something happens to you," Harper notes.

"Establishing a budget, saving, staying on top of credit and insurance, and shopping smart all take some work," Harper points out. "But the rewards to your personal and household bottom line are well worth the effort.

Donation for the "Pink is Beautiful" Fundraiser

by Joanne Hiller

Dear Business Owner,

Thank you very much for your donation to the Island Estates Women's Club "Pink is Beautiful" Fundraiser Luncheon for the Pinellas Mammography Voucher Program. We had 111 local women attend the luncheon/fundraiser held on October 21, 2014 at the Island Way Grill. Each attendee received a copy of the enclosed program listing the names of businesses who generously donated gifts for the event.

Through the generosity of yours and other local business, we raised in excess of $5,500 to support the activities of the Pinellas Mammography Voucher Program which helps women without adequate healthcare receive much needed preventative screening. That number equates to about 70 routine mammograms for women with no known problems or 50 diagnostic mammograms or 59 necessary ultrasounds. By your donation to the IEWC you are making a difference and helping many women in our community.

Regards,

 

Lynne

President, Island Estates Women's Club

Displaying blog entries 1-10 of 32

Contact Information

Joanne Hiller
Coldwell Banker Residential Real Estate
110 Island Way
Clearwater FL 33767
(727)460-5721
Fax: (727)446-2691