Archive for January, 2011

Improving Housing Market?

January 26, 2011

Signs of an improving real estate market:   three straight months of rising sales and a decreasing inventory of homes (a six-month supply is considered healthy; today it’s 11 months).  Currently in Clark County WA, there is nine months of inventory.  The average is 11 months in the past six months.

 ACTION PLAN: Buyers. Don’t try to time the market perfectly. Even if prices fall a bit more, mortgage rates could rise later in the year, offsetting the drop. Initially bid about 10% below what comparable homes have sold for over the past three months; go even lower if the area is rife with foreclosures.

ACTION PLAN: Sellers. Hang on a few more years until the market recovers. Can’t hold off? Then try to unload fast.   Prices will be falling in most areas for the next several months. Pricing your home right is key.

Buyers typically put an upper limit on their search in increments of $25,000 or $50,000. If your house is priced at $365,000, shoppers who cut their search at $350,000 may never see your home.  Slightly underprice your house. More often than not you’ll attract numerous buyers who bid up the price, and you’ll end up getting fair value in much less time. 

 Interest Rates: record low mortgage rates, averaging 4.2% for a 30-year fixed term, are expected to remain low at least through the first half of the year.

Is the market improving? No one knows for sure.  There are no crystal balls.  Nothing in the past compares  with this housing crisis.  With low interest rates, plenty of homes to choose from, what is holding you back?  Is this the bottom?  Won’t know until it’s too late. Hind sight is 20-20.