In any housing market it is important to know what projects to tackle. Some renovations may not be necessary in order to make your home stand out from the rest. Other improvements may not bring you a good Return on Investment.
Many analysts projected home price appreciation would slow dramatically in the fall of 2021 and then continue to soften throughout 2022. So far, that hasn’t happened. The major price indices are all revealing ongoing double-digit price appreciation. Here’s a look at their reports on year-over-year price appreciation for December:
To clarify, deceleration is not the same as depreciation. Acceleration means prices rise at a greater year-over-year pace than the previous month. Deceleration means home values continue to rise but at a slower pace of year-over-year appreciation. Depreciation means prices drop below current values. No one is forecasting that to happen.
In fact, the FHFA revealed that price appreciation accelerated in December in six of the nine regions it tracks. Case Shiller showed that appreciation accelerated in 15 of the 20 metros they report on. As Selma Hepp, Deputy Chief Economist at CoreLogic, explains:
“After some signs of slowing home price growth . . . monthly price growth re-accelerated again, indicating home buyers have not yet thrown in the towel.”
What Does This Mean for You? Are New Jersey Home Prices Going to Continue to Rise?Whether you’re a first-time purchaser or someone looking to sell your current house and buy a home that better fits your needs, waiting to decide what to do will cost you in two ways:
Home prices should continue to appreciate at double-digit levels for some time.
If you wait, rising mortgage rates and high home price appreciation will have a dramatic impact on your monthly mortgage payment.
Maybe the best thing to do is listen to the advice of Len Kiefer, Deputy Chief Economist at Freddie Mac:
“If you’re thinking about waiting until next year and that maybe rates are higher, but you’ll get a deal on prices – well that’s risky. It may be more advantageous to purchase this year relative to waiting until 2023 at this time.”
John McLain 908.878.9356 McLainRealtyTeam@gmail.com
After almost two years of double-digit increases, many experts thought home price appreciation would decelerate or happen at a slower pace in the last quarter of 2021. However, the latest Home Price Insights Report from CoreLogic indicates while prices may have plateaued, appreciation has definitely not slowed. The following graph shows year-over-year appreciation throughout 2021. December data has not yet been released.
As the graph shows, appreciation has remained steady at around 18% over the last five months.
In addition, the latest S&P Case-Shiller Price Index and the FHFA Price Index show a slight deceleration from the same time last year – it’s just not at the level that was expected. However, they also both indicate there’s continued strong price growth throughout the country. FHFA reports all nine regions of the country still experienced double-digit appreciation. The Case-Shiller 20-City Index reveals all 20 metros had double-digit appreciation.
Why Haven’t We Seen the Deeper Deceleration Many Expected?
Experts had projected the supply of housing inventory would increase in the last half of 2021 and buyer demand would decrease, as it historically does later in the year. Since all pricing is subject to supply and demand, it seemed that appreciation would wane under those conditions.
Buyer demand, however, did not slow as much as expected, and the number of listings available for sale dropped instead of improved. The graph below uses data from realtor.com to show the number of available listings for sale each month, including the decline in listings at the end of the year.
Here are three reasons why the number of active listings didn’t increase as expected:
1. There hasn’t been a surge of foreclosures as the forbearance program comes to an end.
3. Many believed more sellers would put their houses on the market once the concerns about the pandemic began to ease. However, those concerns have not yet disappeared. A recent article published by com explains:
“Before the omicron variant of COVID-19 appeared on the scene, the 2021 housing market was rebounding healthily from previous waves of the pandemic and turned downright bullish as the end of the year approached. . . . And then the new omicron strain hit in November, followed by a December dip in new listings. Was this sudden drop due to omicron, or just the typical holiday season lull?”
No one knows for sure, but it does seem possible.
Home price appreciation might slow (or decelerate) in 2022. However, based on supply and demand, you shouldn’t expect the deceleration to be swift or deep.
If you’re on the fence about whether or not you want to sell your house this year, there’s good news. Real estate professionals are highly experienced in how to sell houses safely during the pandemic. Over the last year, agents have adopted new technologies and safety measures designed to keep you safe. And experts say these practices are here to stay. As Bob Goldberg, CEO of the National Association of Realtors (NAR), puts it:
“The pandemic has confirmed to all of us in the industry that technology will continue to transform real estate.”
Below is a closer look at some of the new tools real estate professionals are using to better serve sellers.
New and Existing Technology Are Impacting the Process
In the 2021 Realtor Technology Survey, NAR asks real estate professionals their opinions on the most valuable pieces of technology for their business over the past 12 months. The graph below highlights the top five tools those agents said are true game-changers:Tools that allow agents to serve clients at a distance and limit exposure to others, including eSignature, lockboxes, and video conferencing, became increasingly important during the last year. Those same tools are just as essential today. Restricting the number of people a seller must interact with during the process is the best way to keep all parties involved in a sale safe.
Trusted Advisors Stay Up to Date on Guidelines for In-Person Showings
As things change in our day-to-day lives, the guidance on how to stay safe changes as well. NAR regularly updates the resources available to real estate professionals to ensure the latest recommendations and best practices are readily available. This includes suggestions on how to continue to conduct safe in-person showings.
Agents also follow guidance from the Centers for Disease Control (CDC) to make sure homes are safe. The CDC’s advice includes information on how to clean high-touch surfaces like doorknobs, tables, and countertops so they’re disinfected for all.
This past year changed the way agents do things for the better. Real estate professionals use new technology, tools, cleaning procedures, and the latest guidance to meet your changing needs. The goal is to keep you safe and build your confidence throughout the sales process.
It’s important to know that your safety is still a top priority when it comes to selling this year. Let’s connect today so you can have the best tools available to help you take advantage of today’s sellers’ market.
A short sale transaction is VERY different from the a “usual” home buying process. It involves more time to wait, and more leg work for your Real Estate Agent. Due to the rise of short sale properties on the market, training companies see it as an opportunity to train agents specifically in this area, giving them certification upon completion. Although it’s a plus to have your agent be trained in short sales, it’s better that they have actual experience doing the work that goes behind a Short Sale, Especially in NJ. Here are some pointers on short sales. Focus on the qualities you should seek when hiring an agent for this type of transaction.
What is a short sale?
A short sale is when Real Estate is sold for less than its unsettled mortgage. The value of the properties put up for a short sale has usually dropped by 20% or more. Ex. The Mortgage owed is $500,000, and the new Market Value is $400,000.
How does a short sale work? Let us Explain it to you.
How to Find the Best Agent for a Short Sale in New Jersey will Explain it all to you!
If a homeowner is in financial strife and there is not enough equity in the home to pay off the mortgage after paying for the costs of sale, they may consider a short sale. A short sale allows homeowners to avoid incurring a bad record of foreclosure on their credit rating. To do so, they must present documents that support their claim of inability to pay off their remaining mortgage balance to their lender. These documents are subject to the approval of the lender before the house can officially be put up for sale.
A prospective buyer will have to make an offer to the seller, and also to the lender, and wait for their short sale approval letter.
As a home buyer, what are the advantages and disadvantages of buying a short sale?
It’s cheaper than the usual house prices in the market – The last thing that the bank/lender and the homeowner want is for the house to remain for too long on the market, so they price it low to attract buyers.
Less competition with fellow buyers – Most buyers are not prepared to wait, and since the process of buying a short sale can take time, this trims down the number of prospective buyers that can make an offer on the property.
The process is long – Processing the escrow is a long haul, and the approval of your offer is passed on from the seller to the lender.
You may need to pay costs that are not included in the selling price – Included in these costs are the closing costs, which the lender will not agree to split. There may be additional costs as well.
You buy the house as is – Contrary to the norm of buying a property and asking for a decrease in price based on necessary repairs, price reductions for a short sale will usually be declined. Importantly, you may counteract this by including contingencies on home damage and repair on your purchase contract.
You may need to pay part of the agent’s commission – It’s the lender who calls the shots on commissions for the agents in a short sale transaction. They typically pay more to the seller’s agent. Buyer’s agents know this is the case, and may request a higher commission be included in the buyer’s brokerage agreement.
What agent qualities should I look for when deciding to buy a short sale home?
They Have handled short sales before – Most Importantly, an agent who’s not only handled but closed a short sale. If they’ve closed a handful, that would be even more ideal because. What this means is they know the necessary (and tedious!) legwork short sale transactions require. They could also acquaint you with lawyers to aid you in the negotiation process with the banks.
Ability to explain the whole process of a short sale to you in a comprehensible manner – Have them explain to you all the legwork and necessary measures involved in a short sale transaction. That way, you are able to prepare what needs to be done, and ascertain whether they have enough knowledge to handle the transaction.
They’ve a trained eye for spotting red flags – An agent with a good amount of experience in short sales can easily detect if there are possible legal or tax consequences. Once they spot something fishy in the transaction, they can direct you to consult with your hired attorney on how to address the issue.
They are knowledgeable on lenders and banks –The lengthy part of the short sale process is really at the bank. The agent will need to call for regular updates. Also, an agent who has closed a lot of short sales will know how the lenders/banks fare in the process. This can shorten the process significantly. There would be no guessing game on your side of the equation. Your agent would already know how to strategize in order to expedite the process and make it as smooth as possible.
Firstly, every day that passes, people have a need to buy and sell homes. Especially if they are wondering what if I need to sell my home during the pandemic. It has not stopped during the current pandemic. If you’ve had a major life change recently, you may be in a position where you need to sell your home. And Fast! While you probably feel like timing with the current pandemic isn’t on your side, that is false. Making a move is still very possible. Rest assured, with our technology at your side and fewer sellers on the market, you can list your house and make it. Most Importantly make it happen safely and effectively. Especially when following the current COVID-19 guidelines. Furthermore these were set forth by the National Association of Realtors (NAR) and the Centers for Disease Control and Prevention (CDC).
You may have a new baby, a new employment situation, or you just built a home that’s finally ready to move into. Maybe even some other major part of your life that has changed in recent weeks. Buyers have those needs too! You can rest assured that someone is likely looking for a home just like yours.
According to the NAR Flash Survey: Economic Pulse taken April 5 – 6, real estate agents indicate, not surprisingly, that there’s a noticeable decline in current homebuyer interest. That said, 10% of agents stating in the same survey that they saw no change or even an increase in buyer activity. So, while buyer interest is low compared to normal spring markets, there are still buyers in the market. Don’t forget, you only need one buyer – the right one for your home.
Here’s the other thing – people are spending a lot of time on the Internet right now. Buyers are actively looking at homes for sale online. Some of them are reaching out to real estate professionals for virtual tours and getting ready to make offers. Homes are being sold in many markets.
There Is Less Competition Right Now , so What I Need to Sell my Home During the Coronavirus
Furthermore, 56% of home sellers are removing their homes from the market. This can definitely work in your favor. Although other sellers are removing their listings, your home has a better chance of being notived. Keep in mind, listings will pick up again soon. This is because 57% sellers are only planning to delay the process. If you need to sell right now, don’t wait for the competition to get back in!
Delayed listings from the typically busy spring season will push into the summer months, so more competition will be coming to the market as the pandemic passes. Getting ahead of that wave now might be your biggest opportunity.
The McLain Realty Team can Help Selling your home during the Pandemic
Furthermore, our Real estate team is working hard every single day. Under traditional circumstances, utilizing technology to help both buyers and sellers who need to continue with their plans.
We’re using virtual tours to show homes currently on the market
We are holding Online Virtual Open Houses
We constantly stay connected with the buyers and sellers through video chats, leveraging resources to complete transactions electronically.
Most Importantly, we’re making sure the families we support remain safe especially as life is changing so rapidly.
Finally, homes are still being bought and sold in the midst of this pandemic. If you need to sell your house and would like to know the current status in our local market, let’s work together to create a safe and effective plan that works for you and your family.
Firstly, the Coronavirus disease (COVID-19) has created volatility and uncertainty. Secondly, this is the expected to be the best real estate market in history. How is this unprecedented health crisis impacting people looking to buy or sell a home this Spring?
How has it lead to an all-time low in interest rates?
Why are the costs of housing commodities dropping?
Can real estate activity (i.e. Open Houses and showings) raise virus exposure?
Contact Us Today, to discuss this current market and the opportunity it raises.
With money cheap to borrow, and a Lack of Inventory, it is the Best Time to Sell, with Proper Precautions. Only 16% of Realtors have decreased nationwide decrease in Buyer Demand. With our 87 Step Marketing and Innovation System, we are adding and adapting with Video Tours to make viewing homes easier.
We have been fully trained on the methods to keep your home safe during the times of NJ Coronavirus Real Estate Market pandemic.
John McLain – Team Leader of the McLain Realty Team of RE/MAX 365
Office: 908-923-4538 Cell Phone: 908-878-9356 Call or text 24/7
When selling your house, there are a few key things you can prioritize to have the greatest impact for a faster sale:
1. Make Buyers Feel at Home
Declutter your home! Pack away all personal items like pictures, awards, and sentimental belongings. Make buyers feel like they belong in the house. According to the 2019Profile of Home Staging by the National Association of Realtors, “83% of buyers’ agents said staging a home made it easier for a buyer to visualize the property as a future home.”
Not only will your house spend less time on the market, but the same report mentioned that, “One-quarter of buyers’ agents said that staging a home increased the dollar value offered between 1 – 5%, compared to other similar homes on the market that were not staged.”
2. Keep It Organized
Since you took the time to declutter, keep it organized. Before buyers arrive, pick up toys, make the bed, and put away clean dishes. According to the same report, the kitchen is one of the most important rooms to stage in order to attract more buyers. Put out a scented candle or some cookies fresh from the oven. Buyers will remember the smell of your home.
3. Price It Right
More inventory coming into the market guarantees there will be some competition. You want to make sure your home is noticed. A key to selling your house is ensuring it is Priced to Sell Immediately (PTSI). This means you’ll be driving more traffic to your property, and ultimately creating more interest in your home.
4. Give Buyers Full Access
One of the top four elements when selling your home is access. If your home is available anytime, that opens up more opportunity to find a buyer right away. Some buyers, especially those relocating, don’t have much time available. If they cannot get into the house, they will move on to the next one.
If you want to sell your home in the least amount of time at the best price with as little hassle as possible, a local real estate professional is a useful guide. Let’s connect today to determine what you need to do to sell your home as quickly as possible.
Many sellers believe spring is the best time to put their homes on the market because buyer demand traditionally increases at that time of year. What they don’t realize is if every homeowner believes the same thing, then that’s when they’ll have the most competition.
So, why sell your home this Winter? Less competition.
Housing supply traditionally shrinks at this time of year, so the choices buyers have will be limited. The chart below was created using the months supply of listings from the National Association of Realtors.As you can see, the ‘sweet spot’ to list your house for the most exposure naturally occurs in the late fall and winter months (November – January).
Temperatures aren’t the only thing that heats up in the spring – so do listings!In 2018, listings increased from December to May. Don’t wait for these listings and the competition that comes with them to come to the market before you decide to list your house.
Added Bonus: Serious Buyers Are Out in the Winter
At this time of year, purchasers who are serious about buying a home will be in the marketplace. You and your family will not be bothered and inconvenienced by mere ‘lookers.’ The lookers are at the mall or online doing their holiday shopping.
Finally, If you’ve been debating whether or not to sell your house and are curious about market conditions in your area, let’s get together to determine the best time to list your house.
Ask for more Information in regards to Listing your Home for Sale This Winter with #REMAX365 #McLainRealtyTeam
RE/MAX 365 John McLain McLain Realty Team REMAX365NJ@Gmail.com NJGUARANTEEDSALE.COM