Month: January 2011

It’s about time!

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The national news is now reporting good news about the housing market.  Existing home sales are up, interest rates are down, inventory levels remain low, builders are selling homes and distressed property inventory is staying at bay from the market.  In addition, we are seeing more showing activity at our listings, we are receiving more calls on our signs and as a result, more sales are happening.  This has also resulted in higher prices which is a good thing for all home owners.  What a great momentum shift taking us into the spring market.  All this news can do is to continue to help the economic recovery and build consumer confidence.  As consumer confidence grows and spending occurs – we all win! 

The advice you should take away from this information is – buy today while prices are still low, interest rates are below 5% and great properties are available to you.  The spring market can result in higher prices, higher interest rates and even less inventory as fewer homes are coming on the market.  There is no time like the present. 

For Realtors, spread the word, get busy contacting everyone you know and start selling more homes.  Get it?  Got it?  Good!

Now, go sell something!

Hello? Is it me your looking for?

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Hello???  Where have all the foreclosures gone?

As we enter 2011, our area is poised for a great year in real estate in the Washington Metropolitan Area.  Inventory levels are down, we have jobs, interest rates are expected to remain at historically low levels, and we had the second highest level of price increases in the country last year.

We mentioned inventory levels are down, especially foreclosure inventory.  Why are foreclosure levels down now?  It started with the “robosigning” of documents in judicial states back at the end of October beginning of November timeframe when banks and the Government Sponsored Entities put a moratorium on foreclosures to review their processes and ensure checks and balances were in place in their foreclosure proceedings.  Then, we hit the holiday season which typically signifies a slowdown in the process-yes, the banks and GSE’s have a heart.  It will be interesting to see when the foreclosures will be released for marketing and how – all at once or methodically – and then we will see how it will impact pricing.

We have the jobs.  Of the top 15 metropolitan markets, we have the lowest unemployment rate in the country.  Major corporations have relocated here and are expected to continue to relocate here because of the education level of our workforce, multiple international airports, the cultural diversity, the Federal Government, tourism factors and so much more.  In addition, CEO’s under 30 rank our region in the Top 10 so job losses are less likely to occur here locally.

Also, it is projected that interest rates will remain below 5.5% for 2011.  In order to continue to see a rebound in the housing sector, rates must remain low.  In response to this plea, the Federal Reserve announced it would keep the Fed rate at 0-.25% and have agreed to purchase $600 Billion in mortgage backed securities.  At this time, it would have a devastating impact on the recovery if rates were to escalate substantially.

These factors contribute to more stable prices and in some cases, increasing prices.  It is area specific with some neighborhoods seeing huge price increases while others are seeing decreased prices.  It is so important to contact your real estate professional to learn more about your neighborhood.  But it is a fact; low supply and high demand lead to increasing prices.  Many purchasers who bought in the last 2 years have seen an increase already.  We don’t expect huge increases like we saw in 2003-2006 but we expect to see moderate increases, which is healthier for the economy and housing sector.  Another contributing factor to our increase in pricing is that international investors see the value in our region and in 2010, we were ranked second only to New York City in foreign investment both globally and nationally.

What else shall we keep an eye on this year?  The restructuring of the Mortgage Interest Deduction, unemployment nationally, potential terrorist threats as we approach the ten year anniversary of 9/11, foreclosure activity nationally and if we can get a streamline approach to short sales.  Stay tuned into what is happening so you too can have a successful 2011.  Get it?  Got it?  Good!

Now, go sell something!

It’s all about your peeps

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Lately there have been articles written about diversifying your business – well I say, “Go with what you know”.  It is time to focus on your database, the management of your database and its growth. 

  • The question is, why try to get into foreclosures?  This aspect of the business is already overwrought with Realtors, is difficult to penetrate and in many instances can be very expensive as expenses need to be covered until they can be reimbursed by Fannie Mae, Freddie Mac or the banks. 
  • Why begin mass mailing campaigns?  They are expensive, time consuming, produce a relatively low return on investment plus it takes years to establish yourself as the expert. 
  • Internet campaigns are time consuming and have a relatively low return on investment plus the leads can take years to incubate.
  • People – much like yourself – hate to be cold called, so why do it? 
  • Door knocking is for Girl Scouts, not professional Realtors.

So let’s focus on who you know and how they can get to know you better so you can get referred more business.  How can people in your database get to know you better?  It can be summed up in one word – consistency. 

  • You need to become consistent in your mailings to your sphere.  The mailings need be informative to the recipient – their house value, interest rate information, neighborhood information, area trends, etc.  Also, keep good notes on your members so you can send them coupons to their favorite restaurant, information about camps for kids, etc.  Remember, it is about them – not you!
  • You need to be consistent with your calls.  Call them on their anniversary, the anniversary of the purchase of their home, holiday greetings, birthday wishes (remember I said to take good notes on your members?), summer vacation calls, your neighbor just listed calls, or just checking in calls will all work – do it consistently!
  • You need to provide great client events.  Typically one for the kid oriented groups and one for the adults.  Ball games are great, bowling nights, Super Bowl parties, and Casino nights – all work.  Get creative but just do them.
  • You need to invite to participate in charitable events.  If you don’t host one – start.  If you “don’t have the time”.  Get involved in a charity and volunteer.  Your database needs to see that you are passionate about something other than business.  By giving back – you will get back!
  • Network – consistently to add new people to your database.  Join a BNI, referral share group, chamber, hold business to business meetings, join an association, coach youth sports, and get involved in something to allow yourself to meet more people!  The only way to add to your bottom line is to add people to your database.

Basically, you need to spend the year focusing on your database – not other avenues of business to get you long term results.  Get it?  Got it?  Good!

Now, go sell something!

Over and over and over again!

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I am beginning to feel like a broken record but the statement continues to ring true – now is the time to buy a home in Northern Virginia.  The reasons are crystal clear – interest rates are low, prices are stable to increasing, new home sales are rebounding locally, rental rates are increasing and we have the jobs.  Let’s review, shall we? 

  • Although interest rates nudged below 4% for a 30 year fixed mortgage for a day or two and they have creeped up to a whopping 4.75% – you still can’t get a better deal on a mortgage today from a historical perspective. 
  • Prices continue to stabilize throughout most of our region and are beginning to rise in the lower price points which will have a ripple effect on prices in higher price points as buyers “move up”. 
  • Inventory levels are at their lowest level since this time last year – less supply + more demand = higher prices – Econ 101.
  • New home sales in our area are strong compared with the rest of the country.  Stanley Martin set a record for sales in 2010 – Toll Brother’s numbers are strongest in this region relative to other areas where they build and NVR said sales were strong the first 9 months of 2010.  With this momentum – prices will have to increase.
  • Rental rates are increasing as well making owning a more viable option which in turn will also impact prices.
  • People continue to move to our region because we have the jobs.  Our unemployment is the lowest in the area and the Washington Metro area boasts the lowest unemployment rate out of the Top 15 Metropolitan Markets.  Houses are where the jobs go at night so prices will have to increase. 

So how does this impact you as a buyer?  Jump on the train now because it is about to leave the station!  Interest rates in all likelihood are going to increase to around 5.25-5.5% this year.  Prices will be pushed up due to pent up demand and an influx of buyers into our market place.  You don’t want to be one of the people left on the sidelines saying, “I should have bought early in 2011”.  Get it?  Got it?  Good!

Now, go buy something!