Friday, April 23, 2010
Image by reeltor99 via FlickrWith less than a week to go before the tax credit is over, I've been thinking about what the real estate market in Philadelphia will look like for the rest of the year. I was thinking specifically about the real estate market here, because real estate is too local for me to have a sense of what the national scene will look like in May and after.
The tax credit has certainly sped up the market so far this year. All of our offices have outpaced their production for the same period last year (when we were ranked as the number Century 21 company in our area, and number 3 for the state), so its obvious that the tax credit has had some impact. The question is whether is has driven the market or enhanced the market, and my opinion leans towards enhancement. Investors seem to have re-entered our market, and that (to me) is a sing that they percieve value in our real estate. Though activity is speeding up as we near the deadline, my sense is that the market will slow but not stall after the tax credit, because all of the basic reasons to buy a home are in place.
1. Prices are stable and gaining ground. According to Trend MLS, in the first qiarter of this year, closed transactions were up almost 10% (9.6% actually) and the average sale price actually increased over the same period in 2009.
2. Interest rates remain historically low - I don't think I really have to explain this one. Articles speak about rates going up from 5 to 6% as if that were a lot. People wouldn't be happy unless the bank paid them, but frankly, anything under 9% has always been really indicative of inexpensive money.
3. The financial benefits of home ownership are undeniable in the current market. In a recent article, the New York Times once again published its rent vs. buying calculator, and in our market, with no appreciation and no rental increases, a home buyer still makes out better after only 5 years of home ownership - and any prudent landlord would certainly increase the rent at least a few percent over 5 years!
With all of that going for us, it would seem that we have reason to believe that there will be reasonable activity for the rest of the spring market. Certainly if more jobs are created, and we avoid any major economic body blows, it would seem that we might be headed towards the recovery we have heard so much about.
Existing Home Sales rose in March, as expected. U.S. home buyers closed on 7 percent more homes as compared to February.
Furthermore, versus March 2009 -- a month many people equate to the low point of the U.S. economy -- sales volume was up 16 percent.
"Existing home sale" is the technical term for a home resale; a home previously inhabited by a person. It's the opposite of a "new home sale" which is a sale of a newly-constructed home.
Existing Homes Data is tracked by the National Association of Realtors® and a closer look at the March data reveals some other interesting notes:
- Year-over-year sales are higher for the 9th straight month
- Real estate investors represented 19 percent of all homes purchased
- First-time home buyers account for 44 percent of all buyers
Also worth noting is that the supply of available homes is down on a broader basis. At the current rate of sales, the existing home inventory will be exhausted in 8 months.
Despite banks releasing foreclosures and REO into the Palmyra market, that's still one half-month less from February.
When supplies drops, home prices tend to rise. It suggests an underlying strength in housing that should support home prices through the next few months -- especially as the home buyer tax credit finishes working its way through the system.
That said, real estate markets are local. You shouldn't assume that what's happening on the national level is also happening here at home. Be sure to check with your real estate agent about local market conditions before making a decision to buy or sell.
Friday, April 2, 2010
Spring is here and Philadelphia homeowners are starting their respective Spring Cleaning rituals.
In some households, Spring Cleaning is best tackled in a single weekend filled with rubber gloves, ratty clothes, and sweat. In other homes, it's a less serious undertaking. Either way, to clean a home from top-to-bottom, you need to have a plan.
If you've never used the Martha Stewart, 9-step Spring Cleaning Organizer, check it out. It covers the basics:
- Cleaning shades and windows
- Sorting through wardrobes for "old" clothes
- Cleaning and rotating mattresses and cushions
For most of the cleaning, everyday household cleansers and a vacuum or rags will do the trick.
There are a few items on the list, however, that require heavy-duty appliances; ones you may not keep at-home. For example, cleaning carpets is best-handled with a steam cleaner. You can choose to rent cleaning equipment from a local hardware store, or considering hiring an Angie's List contractor to do the job. It'll be more expensive, but the job will be done properly.
Also on the list is a reminder to check batteries in smoke alarms, carbon monoxide detectors, and flashlights.
Thursday, April 1, 2010
Home maintenance is an ongoing project. There's always something to do around the house, or something to fix. The problem is, you may not have the time, or the skills, to get it done yourself.
In this 4-minute piece from The Today Show on NBC, you'll see some projects are quite simple.
Dubbed "15-Minute Fixes", see how simple it can be to handle 3 common household chores:
- De-alcification of a shower head
- Clearing hair from the inside of a bathroom drain
- Sealing a granite counter-top
Each clean-up job is cheap, quick, and can be handled sans handyman. As Spring Fever sets in, put these fixes on your To-Do List.