Pearson Group Real Estate


June Real Estate Report for Michigan
June 15, 2012, 4:32 pm
Filed under: Clarkston Real Estate | Tags: ,

No new news is good news! The market continues its march upward. The Months Supply of Inventory continues to decline as sales are outpacing new listings coming on the market. Certainly, shaky economic growth news here and in Europe has caused some concerns, but at the moment it appears that the combination of low interest rates and values, along with a large base of consumers able to consume, will cause the housing market to be a key factor in keeping our economy going through this current dip. A nice role reversal for us!

Based on current activity, we expect values to make a relatively quick jump over the next 12 months (10% plus) as a result of low salable inventories, low rates and buyers who for the most part have the financial strength to overbid. As interest rates and values rise and cash buyers become increasingly scarce, more inventory will hit the market and values will settle back to a more normal pace of appreciation.

Median prices have been increasing, but much of that to date is a result of buyers shifting to more expensive homes as well as fewer bank-owned properties. Most of the real appreciation has occurred in the last 90 days, so it will not show up in sold data for a few months. The majority of homes sales are occurring among listings on the market less than 90 days. In fact, in southeast Michigan, 42% of the under 90 day sales are at or above list price (we expect that number to rise as spring market closed data comes in).

As we said last month, 50-70% of all sellers will tell you the market is still slow, with not a lot of activity, while 85% of all buyers will tell you the market is moving at a crazy pace. This is not like 2008 when buyers were scarce. There is an abundance of buyers in the market and we distribute our properties to enough eyeballs that if a seller is not averaging three showings per week or at least one offer in 30 days, the home is overpriced for its market and condition. About 15% of those overpriced homes are eventually selling after several price reductions and, typically 6-8 months longer on the market.

Homes are selling on average at 97% of the listing price (93% in northwest Michigan), which means it takes only a small miss on the right price (5%-8%) to move a home from active to quiet. The good news is once a home’s value is reduced to the right price range, there is enough demand that it will sell quickly (96% of asking price) and not suffer as much of a “stale market” discount as we have seen in the past, but with an extra 6-8 month time cost.

Once again, if buyers are frustrated with a lack of inventory they should not forget to focus on the 50-70% of listings that are sitting on the market. These buyers might use an FHA 203K mortgage to make the updates/repairs that are typically keeping the home from being sold.

Good numbers again for May and good momentum going into June as well.    – See the Supply and Demand Chart below

Dan Elsea
President of Brokerage Services for Real Estate One 

 

 



Home Prices on the Rise
May 21, 2012, 10:35 pm
Filed under: Clarkston Real Estate | Tags:

APRIL SALES STATISTICS SHOW MEDIAN PRICES UP FOR MOST MLS AREAS

  • The median sale price for the entire MLS coverage area rose by 20% as compared to last year.



Bidding Wars are Back for Home Buyers
May 9, 2012, 7:50 pm
Filed under: Clarkston Real Estate

The Wall Street Journal – Friday, April 27, 2012 As of 10:01 AM

Home Buyers are Stunned!  A new development is catching home buyers off guard as the spring sales season gets under way: Bidding wars are back…..Read the Article

The Pearson Group has seen “Bidding Wars” with numerous offers on the houses they recently listed.

Recently Sold!

9073 Bavarian Court –  “Pending”   Robin listed this Clarkston Condo for $79,900 on April 20th.  There were 6 showings within the first 4 days.  “This Bidding War” included 3 offers.

View the Flyer 9073 Bavarian Court, Clarkston MI 48348

Just Listed!

7079 Snowapple  This Clarkston Colonial was just listed on May 7th for $169,900. There have been 6 showings scheduled already. Based on this activity,  the seller’s of this Beautiful Clarkston Home can anticipate the positive outcome caused by another Bidding War

View the flyer 7079 Snowapple, Clarkston, MI 48346



Michigan Monthly Market Update – April 2012
April 29, 2012, 7:18 pm
Filed under: Clarkston Real Estate, Uncategorized

Image

As the market recovers, there will be fewer months where we beat the prior year. Such is the case with March 2012. In terms of new contracts written, numbers continued to show improvement over March of last year. Across all of our markets Closed Sales were down just a bit from last year. This is not a cause for concern (it would be if there were three months of decline). March 2011 was an unusually strong month, so it is not surprising that we did not top it this year. As the percentage of short sales grows, pending sales will outpace actual closings since there is a higher fall-through rate for short sales. The more significant number from this point forward is the average/median sale price, since much of the market gain will be in rising values. If available home inventories remain tight, in ensuing months we may even see a slight decline in the number of homes sold as we simply run out of homes to sell. That trend, however, should not last long because it will cause values to rise thus more homes will be released to the market.

Southeast Michigan as well as both Southwest (Grand Rapids area) and Northwest (Grand Traverse) Michigan, the Months Supply of Inventory (MSI) hit another two-year low. (Southeast Michigan had the largest positive movement.) This is a very good thing because each month with a falling MSI moves us closer to a sustainable appreciation rate. For bank-owned, the MSI fell below 3 months, with non-bank owned at 4.8 months.  Most of that fall was a result of an increase in contracts written in March. Available bank-owned inventories fell, but non-bank owned remained about the same.

The rest of the nation appears to be joining us in the market upturn. Brokers across the country are reporting strong buyer demand and a lack of home inventories, similar to where we where in mid 2011. With the rest of the country joining our party, housing is beginning to move from an economic anchor to one of the key pieces fueling the recovery.

For those looking to move, a common question is… should I buy/sell now or wait for the market to improve a bit? The chart below shows the cost of waiting to buy versus buying this year in terms of total cost of ownership. The chart used the anticipated mortgage and appreciation rates over the next few years to project the cost of waiting to buy versus buying this year (2012).

Image

By waiting, buyers face both a higher interest rate as well as a higher purchase price on the home they buy. Each year a buyer waits it will costs them more (blue line), yet reduce their future appreciation gain (green line). For many homeowners, their mortgage gap is too wide to sell; however, that gap is closing every month, so it is more important than ever for sellers to ask their Realtors to track values.

If you’d like more information on the market, like to list your property, or want information on any property from any broker, you may call or email at anytime.

Thank you,

Robin Cutler and Kay Pearson
PearsonGroup@MaxBroock.com
248-860-0366



Clarkston’s Premiere Golf Community