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Displaying blog entries 21-30 of 33

85% decline in Months Supply of Inventory

by Harold Powell

Everyone is asking where did all the inventory of homes go? Over the last 2 years we have seen a 61% decline in the number of properties available.


In Feb 2011 there were 5100 homes available. Feb 2013 there are 1989 homes available. That’s a net reduction  in the supply by 3,111 homes over the past 2 years.       

An even more dramatic revelation is the months supply of inventory. The months supply of inventory is the time it would take to sell all the remaining inventory based on how fast homes sell.  Monthly supply of inventory is considered a leading indicator of sales activity and the direction that the market is headed.



 As you look at the graph you can see there is an 85% decline is the months supply of inventory from  Feb 2011 to Feb 2013. In Feb 2011 there was 7.8 months of inventory.  Fast forward to Feb 2013 and see that the supply has shrunk to 1.2 months of inventory. What that means to you is that it would only take 1.2 months time to sell all the remaining inventory.

 To give you a sense of this number, a normal market should have about 4-6 months supply of inventory. When the inventory number falls to 4 or less we begin to see appreciation in pricing. The fact that this number is hovering below 2 months means that there is a lot of upward pressure on pricing at this time.

 To show you what I mean look at the chart below which shows a 32% increase(red bars) in the median asking price and a 17% increase(green bars) in the sold price over the past 2 years.

Increase your homes value by 11%

by Harold Powell

Today I wanted to take a couple minutes to show you how we can increase the perceived value of your home by as much as 11%.

It’s been said that a picture is worth a 1000 words and the difference between a good quality photo or poor quality photo can affect your property’s perceived value. As a seller, there are 2 groups that you are trying to persuade or influence in regards to the value of your home.  The other realtors and the home buyers themselves.

 

2 important facts

1. 90% of today's home buyers employ and rely on a professional realtor.

2.  Over 88% of prospective home buyers start their search on the Internet

A study was done with home buyers to see how home professional photography can effect
3 things...

Their perceived value of the home
How likely they were to visit a home
How quickly they thought the property would sell.



Results are very convincing...


1.Those who viewed the listing information accompanied by professional photography valued the property 11.5% more than just a property description.


2.When asked how likely they would visit a home with professional looking photography, 7 times as many respondents indicated that were “very likely” to visit the home vs. a home without photography.

3. Home buyer respondents also felt that the home was 3 times more likely to sell within a standard time frame vs. home with just a description.


Probably the most compelling bit of information is this graph of increase of perceived value. Take a look at this.

As you look at the top bar it you can see  those that who viewed listing information accompanied by professional photography, valued the property at an average price of $460,735, an increase of 11.5 percent or $52,896 over the average perceived price of the description-only property, $407,839.


Here are some photos taken from a 5 meg camera phone compared to the same photos taken by a professional. The question to ask yourself is which picture is more compelling value to you.

 

                                                                  

                

              


Understanding that there are 2 people groups we cater to when we showcase your property online.
1. The agents themselves who tour property online.  As an example this particular property had 237 agents tour this property online within the first day of being on the market.  vs. the 40-50 agents that came through on caravan.
2. The buyers who are looking online to purchase a house.  Its a known fact that 88% of the buyers who purchase a property are looking online.

While perceived value is not the same as what someone ultimately pays for a property, it sets the benchmark as to what this property is worth in a buyer's mind compared to other homes in the same neighborhood. First impressions often have a big impact on a buyers' decision-making process on which homes to visit and how much to offer.



To discuss ways more ways to help you increase the exposure to your property and adding market value at the same time,  please contact me at 339-3516.

People are asking where did all the inventory of homes go? Over the last 2 years we have seen a 61% decline in the number of properties available.

In February 2011 there were 5,100 homes available. In February 2013 there are 1, 989 homes available. That's a net reduction in the supply by 3,111 homes over the last 2 years.

An even more dramatic revelation is the months supply of inventory. The months supply of inventory is the time it would take to sell all the remaining inventory based on how fast homes go into escrow. Months supply inventory is considered a leading indicator of sales activity.

As you look at the graph you can see there is an 85% decline in the months supply of inventory from February 2011 to February 2013. In February 2011 there was 7.8 months of inventory. Fast forward to February 2013 and see that the supply has shrunk to 1.2 months of inventory. What that means to you is that it would only take 1.2 months time to sell all the remaining inventory.

To give you a sense of this number, a normal market should have about 4-6 months supply of inventory. When the inventory number falls to 4 or less we begin to see appreciation in pricing.

The lack of supply is putting a lot of upward pressure on pricing. To show you what I mean, look at the previous blog posting that shows a 32% increase in the median asking price and a 17% increase in the sold price over the past 2 years.

Ventura County median asking price up 32%

by Harold Powell

The median asking price has jumped 32% from 2 years ago. February 2011 the median asking price was 386,500 and now it has jumped up to 509,000. Meanwhile the median sold price is up 17%. With the lack of supply of inventory,  you can see why the asking and sold pricing is trending up for 2013.

Top 10 Remodeling Projects

by Harold Powell

Want to know what gets the best bang for your buck?  This is the latest value report for 2013 put out by the National Association of Realtors.

Homes under contract up 62%

by Harold Powell

Homes under contract or homes in escrow for Ventura County has increased 62% from a year ago. Fueled by historic lows in interest rates, demand for housing has been incredible. This helps to explain the increase in today's home prices.

Remodeling Cost vs. Value Report

by Harold Powell

Homeowners looking for the most return on their investment when it comes to remodeling should consider exterior replacement projects. According to NAR’s 2013 Remodeling Cost vs. Value Report, REALTORS® rated exterior projects among the most valuable home improvement projects.

Median asking price up 45%

by Harold Powell

Yes, it’s true prices are going up.  The median sale or asking price has risen 45% over the past year while the median sold price has risen 15% for Ventura County.

 

 

Today I wanted to show you a couple things that will help you see what happened over this past year in regards to median pricing and where the largest percentage of buyer demand took place.

Let’s start with the median pricing. The median price is the half way point of the inventory.  As you look at the graph you can see (red bars) median for sale price or asking price of those homes on the market has risen 45% over the last year. December of 2011 the median asking price was $379,949. Today its is $550,000!

 

This means that there are a lot fewer lower priced homes on the market and consequently there are a greater percentage of more expensive homes on the market.
It does not mean, however, that the price of one’s home has gone up 45% in the last year.

Meanwhile, the median sold price(green bars) for the county has risen 15% over the past year. A year ago the median sold price for the county was $329,000.  Today the median sold price is $379,000.  The fact that both the median for sale and sold prices are trending up tells us the market pricing will continue to trend the upwards direction for 2013.

Most of the increase in pricing this past year was found where the demand was the greatest. As you look at the price distribution graph you can see exactly where the largest pool of buyers bought last year.

 

The green bars reflect the number of properties sold over the last year. The largest percentage of sales between 300,000 to 400,000 closely followed by 200,000 to 300,000 price point.   The 400,000 to 500,000 price range also saw very strong buyer demand. You can see as you move up in price above $600,000 the demand diminishes significantly compared to the other price points.

I expect that the demand in this market above 600,000 to improve significantly this year. As sellers equity improves in the 400-500k range it allows for an easier  transition to a larger or  or higher priced property.  Consequently, I expect the homes over 600,000 to see greater appreciation this year.

To get more specifics about what your home is worth or about how you can benefit from buying or selling in today’s market call me at 339-3516.

California Appreciation and the job market

by Harold Powell

California has the biggest demand/supply imbalance in the country:

  • Demand is strong and new home supply is low: California is adding more than four jobs for every home built (see chart below)
  • There are very few homes for sale (see second chart below)
  • Monthly housing costs as a percentage of income are near the lowest they have been in 30+ years

In summary, what happens when demand is strong, supply is low and affordability is the best in decades? Pretty easy math.

Prices go up.

 

 

 

 

 

 

 

 

 

 

 

 


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On January 1, 2013, as part of the so-called fiscal cliff negotiations, Congress passed an extension of the Mortgage Forgiveness Debt Relief Act. This extension of this act, which has saved homeowners more than $1 billion dollars in taxes, is great news for struggling homeowners nationwide, and for the agents that represent them.

The extension is now only awaiting President Obama’s signature.

The Mortgage Forgiveness Debt Relief Act was originally passed in 2007 to aid the millions of homeowners who suddenly found themselves in danger of losing their homes to foreclosure following the housing market crash.

Under the Mortgage Forgiveness Debt Relief Act, debt forgiven in a short sale, foreclosure, or loan modification, is exempt from federal taxes on primary residences. For homeowners facing foreclosure, this exemption saves them from paying thousands, or even tens of thousands, in taxes on top of losing their homes.

Now for another year, homeowners can take advantage of this exemption and avoid foreclosure without the fear of an impossible tax liability.

And with banks recognizing the significance of short sales as an effective loss mitigation tool, they’re ramping up for business. Short sales will be the key loss mitigation tool used by mortgage servicers in 2013.

Displaying blog entries 21-30 of 33

Contact Information

Photo of Harold Powell Real Estate
Harold Powell
RE/MAX Gold Coast Realtors
5720 Ralston St. Ste. 100
Ventura CA 93003
(805) 339-3516