Scott’s Top 10 & Market Update

Last year the 2009 predictions were that foreclosures would slow, loan modifications would be more acceptable to banks, adjustable rates will go lower as the Fed continues to lower its rates….conventional arms did not go down…new home sales flat…wrong, prices came down, new home sales went up, builders did consolidate offices, etc. most builders are not doing design centers, but back in basements selling like they use today, more offices will consolidate and merge..Yes. More agents will leave the business…that is correct…88% renewal rate in 2009, 9200 agents at NVAR now, down from 11,000. Prices did not remain stable, but Gateway did grown and expand.

So he was 8 out of 10, so that’s not so bad.

This year, Scott’s predictions are

House values stable below $400,000. More people are saving and not planning on moving unless they have to. More agents will leave the business as it becomes more specialized. If you don’t know the process, ex. Short sales, they will exit the business.  Foreclosure activity will increase, but anything that comes up will be absorbed quickly due to the pent up demand. It will increase, but there won’t be a huge influx of properties coming on the market. They are getting absorbed if they are priced right according to Kent Eley.

Short sale inventory will greater than foreclosure activity. You have to get your head out of the sand and do them and not avoid them. It’s the nature of the business.

More will go “green”. Get your green designation today. More real estate offices will merge or close their doors especially the boutique businesses.

Unemployment should rise through late in the third quarter…it has to get better at some point. We might lose or gain some, but should stay at half of where we are nationally.

Social media…get on board.

Videos….they are the wave of the future.  They will replace virtual tours. Get a recorder and get on it.

Interest rates will rise due to the government backing out of MBS.

Prepare for what the future might bring, so you can act today for what might come going forward. Get into the mindset and prepare for it so when it happens you aren’t shocked or unprepared to handle it.

Who buys the MBS after the government? Foreign investors, big banks with large deposits are hopefully going to step up.  Why then? Government is buying and the yield spread isn’t there. Once they stop, the yield spread will increase and be more attractive to investors and banks to buy at that time.

Rate change…1 ½ percent increase…think Dave Stevens was right, probably won’t go straight up immediately, but it will get there.

Price drops…10% nationally, active properties on the market, less than 1%. 

Spencer….expecting drop as bad as 10% , increase of rates, end of tax credit, etc. first time home buyers and investors are driving the market right now that’s why they are thinking that 10% drop in price is accurate.

Chris…unemployment is going to be huge. People aren’t going to be moving due to no job, etc. economy is expanding, but until unemployment starts to change, nothing will change. No money to buys, etc. not below 9%. If healthcare is passed, it will be an even lower number.

Spencer…references Steve Fuller….lost more entry level jobs, builders are buying land, if the builders start building, then those jobs will be taken.

Brett… builders are building spec and they are going fast…can’t build fast enough. That’s a plus.

Scott…ex. 13 out of 36 houses since March, Camberly homes has sold in the $1.3 million price range.  Winchester is selling (4 sold so far) in Brambleton off of a model the same as model they are in and the people cannot see the lots.  Can’t see them, to them or feel them but people are still buying them. They are even seeing a house that they aren’t going to build on those lots.  Many similar sales situations to South Riding in the late 90’s are.  People bought without knowing the lot configuration with utility easements, etc.

Spencer…condos and FHA approval.  If they are approved…they will sell like hotcakes.   No more spot approvals on condos make approved projects more valuable.  Need to know and keep up with ever changing rules and regulations with FHA.

What is the target market for next year?  First time buyers but how many are there out there?  Investors – maybe.  What we really need is move up buyers…need to get consumer confidence back and the only way to do that is to get jobs back.  Question I –  how do we do that?  Many jobs won’t be replaced.  The term “jobless” recovery is too tough to happen or sustain.  Consumer confidence won’t come back until jobs come back.

Appraisal issues are still out there – not as bad as they were 6 months ago.  Must meet appraiser at property to avoid problems – bring comps, survey, home pricing wizard information, and feedback from agent

Fairfax County is going after flippers – making post inspections of properties, giving current owners amnesty and do inspections to see what improvements have been made to see if they pulled permits and did to code.  Somehow they will go after them for not “playing by the rules”.

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