Monday, October 31, 2011

House Prices: Where They Will Be in the Spring



Many sellers want to wait until the spring before putting their home on the market. This might be for any of several reasons:
  1. They don’t want to be inconvenienced during the holiday season.
  2. They believe that they will see more potential buyers and as a result will get a higher price.
  3. In the northern part of the country, they might not want people walking through the snow and then into their house.
  4. All of the above
In a normal real estate market, this may make sense. However, this market has been anything but normal. This spring will also see some abnormalities. The biggest difference will be the direction prices will take.
In years past, the spring market would favor the seller because increased demand would outpace any increase in supply: the number of houses coming onto the market would not be as great as the number of buyers newly entering the market. In most situations, when demand is greater than supply, prices increase.
The reason this spring will be different is that the supply of homes coming to the market will be dramatically impacted by foreclosure properties being released by the banks. Many believe this increase in inventory will far outweigh buyer demand. In situations where supply is greater than demand, prices decrease.

Will This Actually Happen?

RealtyTrac, in their latest foreclosure report, explained:
“U.S. foreclosure activity has been mired down since October of last year, when the robo-signing controversy sparked a flurry of investigations into lender foreclosure procedures and paperwork. While foreclosure activity in September and the third quarter continued to register well below levels from a year ago, there is evidence that this temporary downward trend is about to change direction, with foreclosure activity slowly beginning to ramp back up.
This will impact prices.

What Do Experts Believe the Impact Will Be?

Here are the pricing projections by several major entities:
  • Zillow believes we will not see a bottom in prices until the first quarter of 2012.
  • Standard & Poors thinks prices will drop %5 in the next few months.
  • JP Morgan Chase believes prices will depreciate 6 to 7% over the next six months.
  • Barclays says prices will fall 7% by the end of the first quarter of 2012.

Bottom Line

You may pay a hefty price for the convenience of not having your property on the market right now.
Originally posted at the KCM Blog: House Prices: Where They Will Be in the Spring

Wednesday, October 12, 2011

Selling your home out of season? A great deck makes a difference


In a perfect world, no one would ever have to face the challenge of trying to sell a house when there's snow on the ground and the trees are bare. In reality, people have to sell and buy homes throughout the year.

While winter may not be the optimum season to showcase your landscaping, there is one improvement you can make that will help you boost your home's outdoor appeal no matter what the season: a deck.

When potential buyers visit your home in winter, they might not be able to envision how green and lovely your backyard will look come spring. But they will be able to see with their own eyes the square footage that a deck adds to the home's living space.

Decks, patios, sunrooms and porches have always been popular with home buyers, but real estate agents say that too often those spaces are neglected or not used to their best advantage. Yet outdoor improvements like a deck can significantly enhance your home's value and appeal. In fact, at the time of resale, a deck will recoup, on average, about 73 percent of the original cost of building it, according to Remodeling Magazine's Cost vs. Value report.

"Anything that adds living space adds value, and the least expensive way to gain space is to build a deck or turn the one you have into an outdoor room by staging it so that it flows seamlessly with the rest of the house," says Mary Beth Harrison of The Harrison Group, a Dallas-based real estate agency. "A great deck can set your home apart from others with the same interior floor plan or square footage, and deck additions typically add value when it comes time to sell."

The cooler temperatures of fall and early winter make the season a great time to add a deck to your home. Or, if you already have a deck, you can enhance its appeal by adding simple touches and accessories.

A bonus space - for example, a tiny deck or rarely used balcony off a master bedroom - can be transformed into a romantic getaway by staging it with cozy, cushioned seating and a raised firepit. You can safeguard your deck and add designer style with Latitudes deck stones, 16-inch interlocking square tiles made of natural slate or granite. Deck stones can provide an effective fire barrier that's an asset under firepits or grills, or when used to create an outdoor kitchen.

Lighting is another way to boost appeal. LED deck lighting kits, like those offered by Deckorators, are both practical and visually appealing. Adding lighting to a deck can be an important safety feature, and also helps create a warm, welcoming mood for evening entertaining.

Another improvement that speaks to both safety and visual appeal are deck railings. Decorative railings with ornate balusters, post cap and postcovers can give virtually any wood or composite lumber deck a distinctive look for a modest investment.

"More than ever before, people look at their decks as outdoor entertainment areas," says Chris Fox of Universal Forest Products, producers of Latitudes Composite decking and Railing and Deckorators, a leader in decking railing systems and deck accessories. "For some, it's a kitchen; for others, a living room. Decks can be party spaces or quiet retreats. With so many different types of deck materials, lighting, rail systems and decorative accents, it's possible to turn a plain deck into a great outdoor space."

"Potential home buyers always react positively to nice decks that look like a great place to hang out," says Harrison. "From a buyer's perspective, if all else is equal, it's true that the home with the best deck wins."