Our group met today for our regularly scheduled meeting and the conversations were lively as usual. Any time you get together with a group of movers and shakers in the industry with a history of production, sharing, and enthusiasm, how can you not get excited?
Here is what we covered:
What is happening in the market? Many of us are seeing a heightened level of activity – properties are selling but also inventory levels are increasing plus many of the agents are getting ready to put houses up for sale over the next few weeks. Overall in the Northern Virginia market our inventory level of active resales has gone from 4,421 houses for sale the last week in December to 6,666 for sale today – it is over a 50% increase in just over 3 months. In addition, this was the same level as what was available in July of last year.
We are seeing a lot of showings, but no contracts on some properties – a little slower, no urgency in the $500,000-$600,000, but the properties under $400,000 is still smoking hot.
Appraisals seem to be working out right now – agents were worried about achieving value but they still worked. It is important to educate sellers and have them be prepared their properties might not get the value and be ready to make adjustments.
Interest rates have increased slightly and will continue to rise through the end of year. Inflation is one reason they will increase along with the timing of the spring market and the fact that the government has gotten out of buying mortgage backed securities. More short sales will be affected by rising interest rates – won’t qualify for HAMP and will go into HAFA. This is a good thing as many people will avoid foreclosure and the inevitable debacle that we have seen where yards deteriorate, appliances are taken, and values are decreased.
More healthy sales are on the market versus distressed sales which is good for the buyers. It appears as if that may change – stay tuned. Right now in the Northern Virginia area, only 21% of the market is distressed sales.
In a recent study of first time home buyers by SunTrust mortgage, only 10% bought because of the tax credit. April 30th is impending date we have been speaking about but it doesn’t appear as if it will have that much of a negative impact on the market because many people aren’t aware of the credit, don’t know if it impacts them so many haven’t utilized it as they should or could have the second time around.
What’s next? Concentrate on short sales – they are here to stay. Open house traffic is high so hold opens to increase your database and get more buyers. Advertise your open houses on Trulia, Postlets, Craigslist, MRIS and e-properties to get the most exposure. One agent has also had success with Washingtonpost.com and it is only $42 per month to advertise opens on for your sellers.
What are your activities scheduled to get more business this year? Working on real deals. Do more networking to build relationships. Continue to grow database. Be sure to reach out to agents with a history of working with in the past to become aware of potential new listings for your buyers. It is all about relationship building. Agents are utilizing Listingbook.com to educate sellers.
Other additional information was shared:
Please, please, please order HOA/condo docs for our buyers if seller or listing agent won’t provide them when we are working with short sales – you have to protect our buyers. We have seen many instances where a high percentage of owners are in default on the association fees. Also, get condo questionnaire filled out prior to listing a condo to see that the new owners can get financing on the property.
Equator says to switch contracts and start from scratch on short sales that kick out – you can no longer substitute new buyer contract at the last minute.
Stay on top of the market, what is happening so you can give your clients the right advice whether they are buying or selling a house. Get it? Got it? Good!
Now, go sell something!