Hello my readers.  I do want to apologize for the 2 month hiatus that I’ve taken.  I should have warned some of you, but I got a bit of blogger burn out…  Hopefully, some of you have been reading my tweets (if you’re not following me on twitter, you should be http://twitter.com/jamistutzman) and you know that homes are selling and that I’m keeping VERY busy.

What?!? some of you may be saying.  Homes are selling??  Yup! its true.  As of right now in Hamilton County alone there are 1341 houses that are pending in the MLS.  Thats fantastic!! Who is buying?  It mainly seems to be the first time home buyers, the people who are under the 250k range.  They’re coming out in force to get the 8k tax incentive.  If you haven’t owned a house in 3 years, you’d be eligible for it as well.  Ask me for more details.

Does this mean that the housing market is in the clear?  Not yet, but it shows that we are on our way to recovery.  I have a feeling its going to be a long process, but it looks to be headed in an upward direction.  Once these first time home buyers start buying up the inventory, the higher priced houses will start to go.  Many people above the 300k mark need to wait for their house to sell before they can buy up.  Its frustrating for those sellers, but they need to either drop their price or just be patient.  We are lucky to be in Cincinnati, we didn’t see the extreme highs of the bubble and therefore we won’t see the extreme lows of the downward turn.  Don’t think that every seller out there is desperate and every home is over priced.  Many homes that are coming up on the market are priced very well for the current day and are actually selling pretty fast!

So, now is the time to get out there and shop!  If you have a first time home buyer house and you’re looking to upgrade, don’t be afraid to try and sell it.  Afterall, if you take a little hit on the selling side, you will probably make up for it on the buying side.

What goes down, must go up. Right?  At least thats how things in general play out in Life.  So why shouldn’t real estate be any exception?  It isn’t. Does that mean its coming back… hmmm not sure yet.  Have we reached the bottom and are at least stabilizing?  I think maybe so or at least we’re close.

I recently read an article on realitytimes.com where Dr. Mark Zandi, chief economist for Moody’s Economy.com, surprised analysts by announcing that “the bottom of the housing downturn is in sight for the nation.”   I had heard whispers of this through some of my out of state colleagues, that some of the hardest hit areas are starting to see some comeback and stabilization.  This is great news!  Why? Because theoretically what was hit the hardest first should also then be the first to start to recover.

Well, I think the key word in Marks quote is that the bottom is in “sight.” Not that we are there yet.  But before that much-desired recovery can take place, the economists warn that there will be more pain. Home values in some of the nation’s hardest-hit markets — in particular Florida, California, Nevada and Arizona — will continue to see prices plunge. In some of the worst-hit places, the peak-to-trough percentage losses will soar as high as 70%. Of the 381 metro areas that the firm looked into, it estimates that 100 will experience peak-to-trough declines of 20% or more. The bright spots on the map — the 42 metro areas that are expected to see a decline of less than 1% — will mainly be in the South.  Of course, job loss will also factor into the ability of some metro areas to improve. Only states that were somewhat immune to the housing boom at the beginning of the decade should expect a quicker recovery.

This is not so good  news for the hardest hit areas, but is somewhat a  sigh of relief for us in Cincinnati. We didn’t see incredibly high home prices and therfore we won’t see ours plunge out of control either.  Housing is still very affordable in Cincinnati.  Our home prices continue to stabilize and more and more homes are starting to come back up on the market.  First time home buyers are ready to use their 8k tax credit and are out searching for the right house.  Our economy looks relatively stable when compared to other parts.

I think its a great time to buy and those who don’t will be kicking themselves in years to come.

The details are out.  Not as great as I’d like, but some of the changes have been for the positive.

Here is the scoop:

1. the limit has been increased to 8k max

2. Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence.

3. Income limits - Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000).

4. Repayment - No repayment for purchases on or after January 1, 2009 and before December 1, 2009

5. Effective on purchases Jan 1, 2009-Dec 1, 2009

For a full comparison of the old vs. new tax credits click here.

I really wish that the entire credit would have been made open to all home buyers.  This really would have stimulated the move-up buyers who are having trouble with getting motivated to sell their homes and move to the next phase.  Perhaps if they  had some incentive, there would be more sales outside the 100-300 range.  Overall, the changes they’ve made are good and I hope those who get it, actually put that money back into the economy.

If you have any questions, email me or talk to your loan officer.

With all of the economic talk the past few months and how housing is in the toilet… I thought it would be fitting to actually show some real estate numbers for Cincinnati.  It is a suburb / municipality comparison of annual single family homes sold, along with the corresponding “average sales price.”

Lets take a look at some of our favorite suburbs:

If there is a specific suburb you want to know about, just ask and  I’ll post it.  Take note - there are actually some areas that have higher average sales prices in 2008 than in 2007.  This is not an appreciation calculation, just simply what the ‘average sales price’ was for that corresponding area.  We can see that some prices are holding in certain areas and others aren’t.  However, this doesn’t mean that your house has devalued, in order to figure that out, you will need a professional to come in and make that assessment.  If you’re not planning on moving anytime soon, don’t worry just stay put and continue to pay your house down.  If you need help figuring out if you should sell or not give me a call.  I can help you assess your specific situation.

It seems as though the Cincinnati housing market is picking up since the holidays, even with the snow we’ve had.  I’ve spent the past week trudging around everyday in the snow!  Buyers don’t run around in the snow for no reason, they’re serious.  But not everyone is thinking the market is as good as I do.  So that has got me thinking.  Who is buying right now? When I look at the majority of my sales over the past few months, I’ve definitely seen a trend.  Well, I can’t speak for everyone but this is what I personally see:

First time home buyers with at least 3.5%down in the 100-250k price range.  They have started to jump on the buying trend, mostly due to the low rates (in the low 5%’s)  and the great incentives ($7500 tax credit).  Its great that these people are buying up some of the stagnant inventory that is out there.   Those who aren’t first time home buyers?  They seem to be sellers who don’t have to sell to buy or they sell their home first and then go out shopping for homes.

So that begs the question, what about those sellers who HAVE to sell before they buy, but are reluctant to do so because they’re not going to get as much as they want/need from their home.  Some sellers see that if they take a little hit on their home now, if they’re buying in the next price range they can take advantage of the great market and save on their new home.  This logic doesn’t work for everyone.  Most of us out there are a direct benefits kind of consumer.  We need to see the direct savings.  I’ve been trying to think of what would spur these buyers/sellers to take the plunge and help us out of our national housing crisis.

Well, over the past few day’s I’ve heard the flurry of news activity around another tax credit being introduced in our stimulus package.  The proposal would allow a tax credit of 10 percent of the value of new or existing residences, up to a $15,000 limit.  Current law provides for a $7,500 tax break but only for first-time home buyers.  This new credit would be open to everyone.  I think this is a step in the right direction.  First time home buyers have begun to take the plunge, its the others that need a little boost.   If its not this tax credit, it needs to be something like it.

Stay tuned for more details and if you have questions feel free to email me.  I’m happy to help.

Our society seems to run on trends.  People are always searching for the latest coolest thing to do, wear or say.  Housing is no exception to this.  Often times we see people giving their homes the latest trend make over in order to sell it fast.   Anyone can google the latest housing trend or in fact all they have to do is open up the latest pottery barn or crate n’ barrel magazines to see it.  But for those people looking to remodel and not sell until a year or 2 down the road.  What about them?  How can they make best use of their money now?  Should they put granite/stainless steel in the kitchen?  Or will it just be outdated in 2 years?  Trends are always hard to predict, but there are a few that are starting to fall by the wayside.  According to a recent article I read theses seem to be the top trends leaving… I’m not sure I agree with all of these.  I’ll post my opinion in italics…

1. Fireplaces: The fireplace skyrocketed in importance in homes in 1991 with 62 percent of new homes having one or more. But the number has steadily been decreasing ever since. In 2007, the number dropped to 51 percent. 

I’m not sure I agree with this one.  In my area, most of the fireplaces don’t work but people still love having them around.  There is a sense of nostalgiawhen it comes to a fireplace.  Especially the Rookwood ones we have.

2. Carpet: While 54 percent of homes still have carpet floors, the number is decreasing and hardwood floors are taking the place. Vinyl and ceramic tile flooring also are being bypassed more by buyers. Seventeen percent of new homes contain hardwood floors throughout the entire house. 

I do agree with this.  Most buyers I have prefer to have hardwood floors.  Some of them still want carpet in the bedrooms.

3. Living room: These once-decorative centerpieces of homes are slowly vanishing from newer homes. Thirty-four percent of consumers say they’re willing to buy a home without a living room.

I’m assuming that this is the ‘formal living room’ that new construction and older homes don’t have.  I find people want a family/living type room.  Gone are the days of the family room and a formal living room. Today’s buyer wants a room that will work for both purposes.

4. Desks in the kitchen: These desks were once looked at as great storage areas but they’re often too small and quickly become clutter spaces in a home, said Gayle Butler, editor in chief of Better Homes and Gardens. Instead, more consumers say they prefer larger desks in or near the family room—equipped with a messaging center—where they can keep an eye on their kids as they work on the computer.

Ha Ha, this one makes me laugh.   Of course these aren’t in any of the older homes I sell.  But I do see them in the suburbs.   We actually had one in the house I grew up in.  My mom used it all of the time.  Of course those were they days before the personal computer.  Now, we’ve got home offices and computer rooms taking the place of these spaces.  People find it a waste of space today.

5. Skylights: The little windows that allow natural light to seep into a home from above are falling out of style. Only 10 percent of new homes will include them this year, a continuing downward spiral for skylights.

I don’t have anyone that dislikes skylights.  I don’t really see this one as being a dying trend.

6. Upscale kitchen finishes: Granite counter tops are slowly becoming less desirable among buyers who are now moving toward affordable, low-maintenance laminate countertops—which tend to last longer and now come in various styles.

This still seems to be a trend in our Cincinnati market.  Everyone is wanting the granite and stainless steel kitchens.  I have often thought of all these kitchens becoming outdated relatively quickly.  My thought is, don’t do it to sell.  Do it because you want to and enjoy it while you’ve got it. 

When it comes to equipping your home with the latest and greatest you take a risk that it will become outdated eventually.  If you enjoy it, then its worth the money.  Have you seen any trends out there that you think are going by the way side?

There was a press release today from the Cincinnati Area Board of Realtors regarding Cincinnati Area Home Sale prices.  The numbers are promising.  A total of 1,272 homes were sold locally last month, an increase of 8.35% over November’s 1,174 sales. Last month’s contracted sales (pendings) are up 1.42% over the level of pending sales one year earlier.  The positive “December-to-November 2008″ sales comparison contrasts with the previous year, when December 2007 home sales trailed previous month sales by 15%.

I think the extremely low interest reates have a lot to do with it.  Right now has never been better to buy a home.  Imagine buying a home 25 years ago…

The Cincinnati Area Board of Realtors notes the following 1981 comparison (when mortgage rates went through the roof) to 2009  (bargain rates):

                       Mortgage      Monthly           Interest                                                             

Year               Rate               Payment          Over 30 Yrs.

1981              16.9%             $1,418            $410,317

2009                5.1%              $ 543             $ 95,462

So We think we’ve got it bad now?  Imagine 16.9%! yikes.  I’ve had buyers decide to take the plunge the past few weeks simply due to these low rates. 

However, its not all good news.  We are still down from the 2007 year to the 2008 year. 

                                                    Yearly Home Sales

                           Closings        Gross Volume           Average Price

Jan-Dec. 2008      18,752        $3,044,201,257             $162,340

Jan-Dec. 2007      22,265        $3,873,808,153             $173,986

             Variance     -15.78%            -21.42%                            -6.69%

I think some of this decline is due to the amount of foreclosures and short sales we are seeing.  As these lower priced homes come up, our volume and average sales price will inevitably go down.

Never fear!  As these homes get absorbed, the market will start to even out and we may start to see some recovery!

I meet a ton of people looking to move (its my business right?). A lot of them get excited when they know about the opportunities and the people in a community. I’m always looking for ways to connect people.  I find that homeowners are most likely to stay in a community when they feel a sense of involvement and they like the people around them. But they usually don’t know where to start. Many communities have websites, but they’re not that great. They’re usually not up to date and they’re pretty un-user friendly. Unless you meet a friendly neighbor who is also involved, you probably don’t know much about your community.  When I moved to Norwood years ago, I had no idea all of the great opportunities they have to serve in the city.  I moved here because it was centrally located and it was in my price range.  However, since then I’ve grown to love it and have been seeking ways to help others get involved.

As some of you know I’m a founding member of the NYP(Norwood Young Professionals) - we are a strong band of young people looking to socialize, connect and help our community.  We have networked with many other organizations throughout the city and helped them with their needs.  We recently met with the Norwood Business & Professional Womens Club to discuss how we can help each other.  There were women from the Tree Board, Service League, Fireworks Committee, High school Band, etc.. All wanting to share with us how they need help and how people can get involved.  So far it all seems to be a grass roots effort here.  I have heard rumblings that the city is going to be updating their website and make it more community friendly and focused.  I sure hope so!  I think we need a bit of a face lift.

One great example of a neighborhood that I think does this well is Northside.  They seem to really do a fantastic job with keeping their community involved and up-to-date.  They’ve got a great website and the people who I’ve helped move there, seem to be really excited that they’ve got this type of forum for the community.

So the purpose of my writing today was really to help you the reader think about how you can get involved in your community.  If you already are, I’d love you to post a comment as to what your community does and how you’re involved.  Help me sell your community to others looking to move there!  All of us get so busy with life, but its really feels good to reach out to our neighbors and feel apart of a community.  I look forward to reading your responses.  If  I get enough for one area, I’ll start a page dedicated to that neighborhood.  Its a win/win for everyone!

There has been a recent surge in buyers looking for lender owned properties. Or perhaps there are just more lender owned properties out there??  Both may be true.  What definitely is true is that people are searching for a deal.  They are looking for something they can make some instant equity on.  Don’t we all want this, regardless of the market?

Yep!  Only now, we’ve got more pots on the fire…   Looking at lender owned properties isn’t a bad thing.  I love it when people see a deal they get excited about and the race is on to put a contract in and negotiate.  However, dealing with a bank is completely different from dealing with your average home owner. There are NO emotions involved.

Here are a few things I’ve learned in dealing with lender owned properties around Cincinnati:

1. Make sure the numbers work for the bank - The bank is looking for a number of things in a buyer, but most importantly they’re looking at the numbers.  They want the most amount of money and they want to close the deal fast.  Cash and close within the week is usually preferable.  However a lot of home buyers who are looking for a deal, just aren’t able to do it.  I’ve been in multiple offers with the bank on properties and they’ll take more money over certain financing  or inspection contingencies.  As long as the buyer looks solid on paper.
2. Banks are Pricing relatively competitively right now - As far as bank pricing goes?  They’re a lot more realistic right now than seen in the past.  With the onslaught of properties that are bank  owned and the anticipation of more of them coming up, banks are becoming more realistic about price.  Its seems as though lately they’re pricing things closer to where they should be, or they’re taking regular price reductions at faster rates than before.
3. Expect Multiple offers -  Almost every lender owned deal I’ve been involved in has been in multiples… and this really upsets the buyers at times.  Contrary to popular belief, even in multiple offers banks won’t always take the highest bid.  Sometimes they reject all offers, perhpas waiting to get something better.  This sounds weird to me, but I’ve seen it happen numerous times.  If numbers don’t work for the bank and they just say no to all parties.  From my side, I don’t get it.  Isn’t it better to cut your losses early than to prolong the evadable?  Also, one of the first rules in real estate is “your first offer is always your best offer.”  Ask any seller who has been burned on this.
4. Expect to make some repairs and improvements to any of the lender owned properties you look at.  Most of the time, the copper has been stripped, the appliances have been taken and the house is really just a mess.  After all, if the previous owners couldn’t afford to keep the property, how could you expect them to afford to maintain the property?
5. Expect for the deal to take longer than normal. 
6. Make sure the deed is in the name of the bank and still not in the previous owners name.  I was just told this recently by a mortgage banker friend of mine.  Making sure this is clear will keep a lot of headaches from happening.
7. Be sure that none of the utility bills are attached to the house.  This discussion came up around the office the other day.  Someone had this issue come up with a 1700$ water bill as a lien on the house.

Thats about all I can think of right now.  I’m sure as my experience grows with these, there will be more to add to the list!

HAPPY NEW YEAR!

Many people like to do predictions for the new year. I’ve read it on countless sites, and heard many people talk about it.  Everyone says something different - The market will go up, the market will go down. It will be another year until we see improvement or we will see improvement by summer. Interest rates will go up, or they’ll go down even further…

Does anyone really know?  Predicting real estate right now is like being a weatherman in Cincinnati.  Sometimes we are right and sometimes we are wrong…

So what can we bet on?  No one really knows for sure.  But one thing I can tell you is that “what goes down, must come up.”  Its true we are seeing numbers go down, but if prices continued as they had, no one would have been able to afford housing.  They’re coming back into a realistic place  - so that we can all afford to purchase a home.  We didn’t see real estate in Cincinnati fly through the roof like other parts of the country, so we won’t see it come crashing down either…

Housing is something that is a basic need for everyone.  We all need a place to live.  There is always someone that is going to purchase the homes that are out on the market.  If people are buying, that means that homes are selling!  And with the start of the new year, there are  a lot of people out there looking to buy.

Some like to think that financing is stopping people from buying , however financing is almost a “non issue” right now.  Its a big myth that no one is getting financing approved for a home.  Simply not true.  You’ve got to have some money to put down and you’ve got to have good credit.  Perhaps you can’t afford the house that you really want (who can??) but you can qualify and thats the biggest thing.  The record low interest rates right now are VERY enticing for those prospective buyers.  Cincinnati always seems to be a little behind in the trends, so by spring time we should all realize that its a good time to buy with interest rates this low.

There are places in Cincinnati that are actually doing well.  In Oakley we’ve actually seen some homes appreciate from last year to this year (meaning they sold a little over a year ago and actually sold for more money recently).    Isn’t that something? 

So what do we get from the predictions of 2009?  - houses will continue to sell and people will continue to buy.  Interest rates for the time being are FANTASTIC and if you haven’t taken advantage of refinancing or purchasing yet, you should…  Real Estate is never a bad investment when its treated as a long term one…

Here is to a GREAT 2009!  Thanks for reading.