High Demand Creates Hot Seller’s Market

2015 high demand-sellers-market

2015 high demand-sellers-market

It’s August and the sun isn’t the only thing that’s hot.

Kids are going back to school, vacations are ending, temperatures are rising and the housing market is steaming, especially for sellers.

The real estate industry, normally slower at this time of year, is now on fire.  Low interest rates, lower-than-normal supply, and a rebounding economy have sellers of all ages diving into the smoking market.  As kids across the state and nation arrive to their first day of school, realtors everywhere are scrambling to get folks into homes before parents become burdened with homework, quizzes and the usual paperwork that comes with the first few weeks of school.

Summer continues to get shorter, and Real Estate agents feel the pressure, especially with an in-demand housing market on their shoulders.

And it seems the summer momentum is not showing any signs of fizzling.  Days ago, Fannie Mae released its July 2015 Housing Survey, showing a renewed optimism among its participants.  More than 65 percent of those surveyed said they’d rather buy than rent, even while knowing home prices are predicted to continue to soar.

Home prices. They’ve been climbing, and they haven’t stopped since 2012.  During the past 3 years, prices have soared by 27 percent.  This is great news for sellers and would-be home buyers and investors.  Combine this solid return on investment with historic low interest rates, and all is well.  Or is it?

Nothing lasts forever…  Just like Guns N’ Roses sang, “November Rain” is expected to bring change.

The Federal Reserve is predicted to raise federal fund rates this fall.  This act will likely affect our low mortgage rates.  The National Association of Realtors (NAR) predicts mortgage rates will rise in the next couple months.

In spite of the short window about to close, homes are staying on the market longer.  In fact, houses across the nation are being left on the table 7 percent longer.

Realtor.com’s Chief Economist Jonathan Smoke isn’t worried, though.

“It’s typical to see a slackening in the pace of market activity during this time of year, due to back-to-school and the ‘Dog Days’ of summer,” Smoke said. “Increasing median days-on-market suggests the market is finding more of a balance, but demand is still strong. This bodes well for more moderate price appreciation in the months ahead.”

Knowing the window of opportunity is soon closing, right now is a great time to be a home buyer or home seller in West Virginia.  The Mountain State recently earned the No.7 spot for Huffington Post’s most desirable states to get a mortgage loan.

“West Virginia’s mortgage rates are better than most, with its average 30-year rate about on par with the national average balancing out its average 15-year rate, and housing costs remain low in this state,” the report states.

The door of opportunity could soon be closing.  What are you waiting for?

WV Real Estate Photographer Justin Waybright & WV Real Estate Agent Chuck Boggs

Home Prices, Demand Rise

Rising Home Prices Create Solid Investment

Housing Demand Rises

Housing Demand Rises

Housing starts, interest rates, home sales, home prices.

What do the four have in common?  They’re on the rise.

Let’s talk about home prices.

The price for a home will more than likely cost you less today than it’ll cost next month.  Home prices climbed by 6.3% in May, marking 39 consecutive months of year-over-year gains, according to a report by CoreLogic.

In West Virginia, realtors expect home prices to rise by 2-3 percent during the next 12 months, according to the Realtors Confidence Index Survey Report.

This creates a dilemma for home buyers and home sellers alike.

Sellers: Do you hold on to the home and let its price rise to its peak, then unveil it to the market?  Or, do you sell now while demand is high?

Buyers: Do you buy the home of your dreams now while interest rates for 30-year mortgages still hover at 4 % and home prices are still tangible?  Or, do you wait to see if home prices decrease, but risk an interest rate increase?

National Association of Realtors (NAR) Chief Economist Lawrence Yun believes buyers hold the key to the future.

“The demand is there for more sales, but the determining factor will be whether or not some of these buyers decide to hold off even longer until supply improves and price growth slows,” Yun said.

What’s the rest of the nation doing?

Pending home sales in May remained the highest in more than nine years.  The Pending Home Sales Index showed June 2015 bringing 8.2 percent more for its rating than June 2014.

A recovering economy and steady home price appreciation seem to be pulling buyers into the housing market.  But, can the amount of listings meet the demand of more buyers?  It seems the demand from the influx of new buyers is greater than the supply of available homes.

Any economics professor will tell you, “When this happens, the price goes up.”

That’s exactly what’s going on.  The existing price for all housing types is expected to increase to 6.5 percent, matching the record high set in 2006.

“Buyers have come back in force, leading to the strongest past two months in sales since early 2007,” Yun said. “This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that’s giving more households the financial wherewithal and incentive to buy.”

Last month, existing-home sales increased to their highest rate in over eight years, while the effect of rising demand and limited supply pushed the national median sales price to an all-time high.

The data continues to support a strong housing demand.

This month housing starts rose 9.8% to an annualized pace of 1.174 million, the highest since July 2007, according to recent data released by the US Census Bureau.

Building permits, which point to the pace of future construction, rose by 7.4% to an annualized pace of 1.343 million.

NAR President Chris Polychron said that even with the uptick in home prices, demand remains solid.

“The demand for buying has really heated up this summer, leading to multiple bidders and homes selling at or above asking price,” Polychron said.

With interest rates hovering near historic lows, home prices increasing at above-normal rates and demand rising, the window of opportunity to jump into a thriving housing market is gradually closing.  Opportunities such as these don’t last forever.

So, this begs the question for home buyers, sellers and investors: What are you waiting for?

By Justin Waybright and Chuck Boggs

 

 

 

 

Summer 2015 Brings Heat to WV Housing Market

WV Housing Market on a Roll

WV Housing Market Heats up Summer 2015

WV Housing Market Heats up Summer 2015

As July ends and August begins, the WV housing market continues to rise like the temperature.

Existing home sales jumped by 3.2 percent in June to a level the country hadn’t experienced since 2007.  Here at home, the trickle effect is growing.  Increased number of homes sold, continued price appreciation and historically low interest rates continue to pave the way for one of the hottest seasons for the West Virginia housing market, ever.

More and more families are diving into the inviting pool of home ownership.  And why not?  The sun is hot, the water is cool and as we predicted back in March, now is the opportune time.   Whether you’re a first-time home buyer or a veteran home buyer, now is certainly the time to buy.

Mortgage rates in West Virginia are better than most, with the average 30-year rate nearly on par with the national average.  Just last week, rates through the WV Housing Development Fund dropped to 2.81 percent, the lowest level in the agency’s history.

Housing costs remain low across the Mountain State.  The median price of a home in West Virginia is the lowest in the country at $94,500: Just another reason to buy.  Keep in mind the average cost of a home in the US is $189,000.

Due to these factors, West Virginia is considered a top pick for first-time homeowners.  See our article on that here.

Need some more reasons to jump into the housing market?  Try the current interest rate on for size.  The nation sits at 4.1 percent for the popular 30-year fixed mortgage.  However, great rates like these don’t last forever.  Investors and federal representatives continue to imply the rate will increase as the year rolls on.

RealtyTrac Vice President Daren Blomquist believes the housing market recovery is still tentative, and could be temporary with the rate increases looming in the future.

“I think this market is still very interest-rate sensitive and fragile,” Blomquist said. “If we see interest rates go up, the kind of boom we were seeing in the first half of the year could quickly disintegrate as homes become less affordable with higher interest payments.”

See their full article here.

Due low interest rates, the availability of affordable housing, state assistance, the variety of loan products and home appreciation, West Virginia has the highest home ownership rate in the country, according to U.S. Census Bureau data.  The pride of home ownership is alive in the Mountain State.  More than 73 percent of homes in West Virginia are owned by their occupants.

While other states have endured loss during the past decade, the WV housing market has grown. According to data from GoBankingRates, the share of new first-time homeowners increased 57.6 percent between 2003 and 2013, while foreclosures have remained low at less than one percent in 2015.

We’ve said it once and we’re sure we’ll say it again: If you’re wishing to buy or sell a home in West Virginia, now’s your time.

By Justin Waybright and Chuck Boggs

Home Appraisal: Fact & Fiction

All About Home Appraisals

Want to buy or refinance a home?  You’ve got to get an appraisal.  However, misconceptions continue to deter many.  Let’s lay those to rest, shall we?

Fiction:  Assessed Value should equal Market Value.
Fact:  This is often not the case, as appraisers and assessors use different methods to arrive at a home’s value.

 

Fiction:  The appraised value of a home will be different depending on whether the appraisal is completed for a buyer or a seller.
Fact:  The appraiser is an objective authority, who has no vested interest in the home or property he or she is appraising.

 

Fiction:  A home’s Market Value should equal its Replacement Cost.
Fact:  Market value is based on what a buyer will likely pay a seller for a home or property. Replacement cost is the dollar amount required to reconstruct the home or property.

 

Fiction:  A home’s value will rise or fall dependent on the health of the economy and/or the housing market.
Fact:  A home or property’s appraised value is dependent on an individualized basis, regarding various aspects of the home or property in question.

 

Fiction:  You can tell what a home or property’s value is simply by looking at the exterior.
Fact:  A home’s or property’s value hinges on a number of aspects, including location, improvements, amenities, condition, materials used, age and market trends.

 

Fiction: Because consumers pay for appraisals, they own their appraisal.
Fact: The appraisal is legally owned by the lender, unless the lender “releases its interest” in the document.

 

Fiction: Consumers do not need to be concerned with what is in the appraisal document as long as it satisfies the needs of their lending institution.
Fact: Only by reading a copy of their appraisal can consumers double-check its accuracy and question the results.

 

Fiction: An Appraisal is the same as a home inspection.
Fact: An Appraisal does not serve the same purpose as the home inspection. The Appraiser forms an opinion of value in the appraisal process and resulting report. A home inspector determines the condition of the home and its components, and reports these findings.

 

Fact: There is no reason to order an appraisal unless you are trying to get an estimate of the value of a home during a sales transaction involving a lender.
Fiction: Hiring an appraiser can fulfill a variety of needs.  Appraisers can perform a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.

By Justin Waybright & Chuck Boggs

 

 

West Virginia Popular Among First Time Home Buyers

West Virginia: a Magnet for First Time Home Buyers

There’s 50 states in this great nation, and West Virginia is No. 1 for first-time home buyers.

During the past 10 years, first-time home buyers flooded the Mountain State. From 2003 to 2013, the amount of new first-time home buyers in West Virginia increased by more than 57 percent while foreclosures in 2015 remained low, holding at 0.01 percent.

Days ago, GoBankingRates conducted a nationwide survey and found the Mountain State to be most desirable. A number of factors make up the findings that place West Virginia above the rest.

Let’s take a look:

Low costs

The low costs of buying a home in West Virginia make it accessible and affordable for folks on a budget. The median sale price of a home in the Mountain State is $115,850, according to reports from Zillow. This translates to a $550 monthly payment for a 30-year mortgage. That’s almost 40 percent less than the monthly payment one can expect to endure for rent.

Helpful Resources

Strong and easily accessible public programs are available for first time home buyers in West Virginia. The West Virginia Housing Development Fund offers a special Homeownership Program that provides 100 percent financing for first-time home buyers who meet income requirements. The state also offers Down-Payment/Closing Cost Assistances programs.

Solid Market

West Virginia holds a resilient housing market, containing a plethora of homes for all styles, needs and budgets. A long winter has brought forth a healthy spring and summer for both home buyers and home sellers. Demand from home buyers continues to rise as interest rates continue to sink. Home values constantly rise, adding an extra incentive for those wishing to invest and build equity.

Spring has proven to be a success for not only West Virginia, but the national housing market. In May, 32 percent of home purchases were made by first-time home buyers, according to stats from the National Association of Realtors (NAR).

“This is an encouraging sign, stemming from strong job gains among young adults, less expensive mortgage insurance and lenders offering low down payment programs,” said Lawrence Yun, chief economist for NAR.

Yun believes, if current trends continue, the amount of first-time home buyers entering the market will rise even further.

By Justin Waybright and Chuck Boggs

This themes includes code from Andreas Hassellöf, licensed under a Creative Commons Attribution v3.0 License