I had posted the final numbers for February before leaving on vacation and now have posted the real estate sales in my market areas for the first 10 days of March. Continuing the trend that has been evident since the beginning of the year, the total number of sales in February and the first part of March are down this year, when compared to last. That’s mainly due to the lack of inventory in the market, but also aligning with the national trend of sales being off a bit.
Locally, Average and Median sale prices continue to trend up in my markets, as does the recovery of the Cost per Square Foot stat. The average for sale value vs. SEV continues to run between 2.4 – 2.6 times SEV in non-distressed sales, which continues to show that the assessors have overshot on the downside and the market has reversed and is rising faster than assessed values. Lower than sale price appraisals continue to top the list of concerns of local Realtors.
The recovery locally has been uneven, with 3-4 of the 9 markets that I track doing very well and 2-3 lagging behind. Those laggards also still have the highest foreclosure and short sale rates. New builds continue strong in Lyon Township and have come back in Milford, too. New build costs per Sq Ft are now running between $115 – 135/Sq Ft, depending upon the quality of the builds. You can see all of the stats for March and 2013 Y-T-D by going to my web site www.movetomilford.com and clicking on the choice – What have homes in this area sold for?
The tight market has also made it more difficult for Realtors and appraisers to find “Comps” to use for Comparative Market Analyses (CMA’s) or appraisals. That has also affected Broker Price Opinions (BPO’s) that are used by banks to evaluate short sale and foreclosure offers. I’ve had a tough time doing CMA’s lately and have had to expand out further in distance and time than I would normally like in order to fine any similar home sales to use.
What this all means for buyers and sellers?
Well, it’s a great time to be a seller – the tight inventory and rising prices have resulted inan environment where you will get the most for your house that the current market will bear, without having a lot of competition. You still need to keep your house in good condition. The market has shifted a bit towards favoring the move-in-ready houses, rather than the fixer-uppers. So if you’re getting ready to put your house on the market, work yor way down that to-do list of deferred maintenance items that you’ve been meaning to get to for some time.
For buyers it’s a frustrating market – there is less to choose from and, with more buyers chasing the reduced inventory, it is not unusual to see bidding wars for good houses. In addition, buyers are finding it tougher to get the mortgage that they had supposedly “pre-qualified” for once they have and accepted offer. Stricter underwriting policies mean that buyers need to get the best advice that they can find from their mortgage agent about what to do and not to do during the process. Even the most innocent misstep can put something on your credit report that the underwriters will see and use to disqualify you for that mortgage. If you’re a first time buyer or have not owned a home for at least three years, remember that MSHDA is still offering grants of up to $3,000 for non-military and up to $5,000 for military buyers. That money can be used to cover some of your closing costs and does not have to be repaid.