I was recently at a real estate conference and one of the Realtors was talking about their listing process. He said one of the questions he often asks sellers is whether they want to list to sit or list to sell. In today’s market, this is a very smart question.
I often think of the real estate market like the stock market – there is a price to buy and a price to sell.
Would you call a stock broker and tell them that you would like to sell stock ABC for $50 per share when the price is actually $42 per share? The advantage to the stock market is that the value is printed for you. In the real estate market we can’t always give you an exact price that your property will sell for, but we can usually tell you what it won’t sell for.
It is important to realize that sellers and real estate agents do not determine the price; especially in this market. It is all based on the current real estate market.
So when you list your property, do you want to list to sit, or list to sell?
I noticed in the local Island Packet today that the average 30-year fixed mortgage has reached 4.93% which is the lowest level we have seen in quite some time. If someone is interested in purchasing property on Hilton Head Island, interest rates are your friend.
There are a lot of things pointing out that now is a great time to buy – there is a great selection of property, great prices, low interest rates and motivated sellers.
If you read my blog yesterday, you know that we were talking about the states with the highest percentage of mortgages with negative equity.
The following are the states with the lowest percentage of mortgages with negative equity; Oklahoma with 6.1%, New York with 6.2%, Montana with 7.4%, Alabama with 7.4% and North Dakota with 8.6%. There were several states that did not report including Louisiana, South Dakota, Maine and West Virginia.
If you will notice, the states with the highest percentage of mortgages with negative equity are ones where massive building occurred and most of the mortgages were obtained between 2003 and 2007.
For the real estate market to turn around we are going to have to see the number of foreclosures reduced. With high numbers of foreclosures, it makes it very hard for regular sellers to compete in the real estate market.
I received several phone calls from clients this morning asking if I had seen 60 Minutes last night. Unfortunately I missed it, but I have actually been doing some research myself looking at the percentage of mortgages that have negative equity – meaning that the owners owe more than the property is worth. There are five states that are in really bad shape with very high percentages of mortgages that have negative equity; Nevada with 65%, Arizona with 47.9%, Florida with 44.7%, Michigan with 37.3% and California with 34.7%.
I find this absolutely unbelievable – this means that in Nevada that 2 out of every 3 people with a mortgage have negative equity. These statistics have a detrimental effect on the real estate market. I feel that it important to realize that one of the first things that needs to be fixed is the real estate market as it has an effect on many other factors in this economy.
If you look at these numbers you will realize that we have not solved the foreclosure problem in the United States and it could definitely get worse before it gets better. For purchasers, there are some great opportunities available.
Stay tuned – tomorrow I will give you the states with the states with the lowest percentage of mortgages with negative equity.
Many companies report their quarterly sales – I’ve seen all kinds of numbers floating around comparing 2009 to 2010. I thought we should look at these statistics for the Hilton Head Island real estate market.
For the first quarter of 2009 we had 562 homes sell in Hilton Head MLS, compared to 670 sales in 2010.
We had 304 villa sales in 2009, versus 325 sales in 2010; for a total of 787 sales in 2009 versus 984 in 2010 which gives us a 24% increase in properties sold.
This tells us that even though prices are decreasing in the Hilton Head real estate market, people are buying property.
For buyers, get in there and take advantage of some of the great purchasing opportunities.
We seem to be in a slow real estate market where the number of sellers outnumber the number of buyers.
I recently spoke to one of my sellers to tell them that we were expecting an offer. He told me to relay to the purchasing agent not to bring him a “low ball offer”.
I had to tell the seller that it might be, because they have been reading the same newspapers and watching the same news – they know that the buyers seem to be in the driver’s seat at the moment.
The offer came in and it was less than he wanted, but we were able to negotiate the sale – the buyers ended up paying a little more than he wanted to pay and the seller ended up taking a little less than he wanted to take.
In a slow real estate market I think it is interesting that a seller expects someone to make an above average offer. Why would a purchaser pay retail in a slow market. They have to step back and take a look at the market through a buyers eyes and ask what they would do in that same situation.
Spring is here on Hilton Head Island and there are a lot of things going on in the real estate market. Here is a quick snapshot of what has happened during the first quarter of 2010 in the Hilton Head Island Real Estate market.
We have had 393 sales on Hilton Head Island from January 1, 2010 through March 31, 2010 (homes, lots and villas). Area sales are as follows:
James Wedgeworth was recently featured on The Lowcountry Report, produced by local network, WHHI. James gave a quick update on the current real estate market and where he sees the real estate market going in the near future.
You can only put your life on hold for so long; this is why I feel that 2010 will be the year when a lot of people will work harder than ever to get their property sold.
I feel like most people who currently have had their home listed during this tough real estate market come to the conclusion that their property has been on the market for a long time and that they are not getting any younger. They will reduce their price in order to get their home sold in today’s market so they can retire.
I believe that I have definitely seen this trend spike in the first two months of this year. I have sold more property in the last six weeks than I ever have in this same time period in years past. People are ready to make a move and they are tired of waiting around for the market.
I believe pent up demand is one of the reasons this trend will be true; another reason I believe 2010 will be the year of the buyer.
