What does the typical seller accept for price on their home?

 

A client of mine, recently  asked me a great question; they asked me “How much a seller is willing to sell their home for, less than asking price?” To start the answer… there is no typical seller….

Every person selling their home has a different reason for selling; every person selling their home is in a different financial position.

The more important question is to ask What are the market and the market conditions telling you about where homes are selling?

· you need to consider the purchase price of the home you’re looking at

· the neighborhood the home is in

· as well as the sellers and what did they purchase the home for and was it financed

These items together will give a little better idea of where to start with your offer; and what the seller is likely to accept.

 

I still wish I had a crystal ball….

Market Update – May

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If you read the real estate news in your newspaper, any day now you will be reading that the real estate market has turned!   UP for a change. 

The right numbers are positive and the right numbers are negative….what I mean is the Sales prices are up.

 Really good news is that the percent of sales to list price is  98.3%.    The “make a low ball offer” period is over.  The lender owned homes are selling with multiple offers, almost to the point of bidding wars.   The number of “conventional seller owned” homes are up.

The right negative numbers are for inventory. The number of lender owned and distressed properties is way down.   Our inventory is very low, actually 47% lower than it was first quarter last year! With a total number close to 13,000.  April’s closings were 8400 The month supply is rated at about 1.5 months !    There are 20,500 sales shown as pending and Active with Contingencies. 

The Active Adult 55+ market presently has 2131 homes for sale with 898 sold in April, another 920 pending  and a current supply of 2.3 months.

These numbers are being repeated in select cities across the country, not just the Phoenix Valley of the Sun. 

To make things even better in the real estate world, the interest rates for the conventional 30 year mortgage  are hovering around the 4% level.

 

April 2011 Market Conditions

Here is the April 2011 Market update from my broker at John Hall & Associates, Jim Sexton.

Inventory is down, pending closing up, all improvements

Here in the greater Phoenix area there is a lot of talk about the changing market.  Our outlying areas have seen the greatest recovery.  Well, let me rephrase that.  Those outer areas, prices have dropped to such a level that people are jumping in to purchase.

days-inventory

This chart is the current inventory, the number of homes currently on the market actively listed, divided by the number of homes that are closing.  Giving us an idea how long it would take at the current level to sell all of the homes available.  Back in April of 2008 there was a 420 day supply of homes.  That is a lot of homes, and not many people purchasing.

Move forward a little more than a year, and we have 209 day supply of homes.  Currently we have people buying homes, and fewer on the market.

active-listings-2

The first chart must be looked at comparing it to active listings.  Together they tell a better picture.  This is the chart of active listings.   I included the 2002 and 2003 data because they show a ‘normal’ market.

You can see the inventory levels rose and reached their highest point in late 2007, and remained high all through 2008.  The first part of 2009 we see the number of listings is reducing, currently at 41,197 active listings.

pending-listings

The last chart to compare is the pending listings.  Is this a fluke or going to last.  This chart is jagged, due to many closing at the end of the month.  You can see the current pending listings is high.  Due in part to lenders taking longer to approve buyers.

From this information we know there are lots of people purchasing homes.  The inventory levels are dropping,  and there are lots of homes pending and about to close.  At least for the next few months, the Phoenix market is moving!

This just in: People are buying homes!

Chicken Little’s  “The Sky is Falling” is everywhere in the papers.  I figured a little positive press would be welcoming.

 

People are buying homes!  

 

There it has been said, now for the proof.  January statistics are in and the Arizona Regional MLS has published their report for this month.  

 

January is the 8th consecutive month of increased sales comparing months year to year.  January 2009 had 4742 closings that is a 63% increase over January of 2008 with only 2912 closings.  

 

January 2008 was the slowest month for closing in the past 8 years.  I don’t expect we will see that 63% increase again next month.  Time will tell though. 

 

The closings in January and in the past few months are more comparable to those in 2001, 2002 and 2003.   This is all good news, there are still a lot of homes on the market and hopefully, we will see the inventory start to lower as well, when that happens prices will stabilize.

Foreclosures and the Adult Communites

Although there are no adult communities within McCormick Ranch, our initial website is focused on Active Adult Communities and we work with many 55+ buyers.   

We are seeing lots of numbers being published for the ratios of Bank Owned and Short Sale properties in the valley.   We are not seeing those same numbers in the Adult Communities.   Since it is a cold rainy day, I have been playing with numbers and really surprised myself with what I found!

Taking only single family detached homes in the entire MLS for the valley, a total of 41,832 this morning, 10,796 of them were Bank Owned and an additional 9,003 were Short Sales.  Those numbers round off to 25% of the single family homes on the general market are bank owned and another 21% are short sales.  

Current MLS Single Family Homes on the market, with Bank Owned and Short Sale

Current MLS Single Family Homes on the market, with Bank Owned and Short Sale

 

 

BUT when you look at the Active Adult Community 55+ single family homes, there are a total of 2819 on the market.  Of that 2819 only 52 are bank owned and 63 are short sales which works out to 2% of the homes are bank owned and another 2% are short sales.

Current active single family home listings in adult communities comparing bank owned/ foreclosure and short sale

Current active single family home listings in adult communities comparing bank owned/ foreclosure and short sale

 

 

HMMMM  kinda makes you wonder.    Our 55+ citizens have indeed saved for their retirement homes, their financing is minimal and their risk taking days are in the past.

There were very few zero down,  or investor homes sold in these communities in the 2005 and 2006 sales surge.    I believe it is the investors who did get in to these adult communities, that are making up the Bank Owned and Short Sale properties.

Scottsdale’s McCormick Ranch home sales Statistics

Here are the numbers for the beginning of the month.  We see an increase of listings, and that is expected.  People who held off listing their homes over the holiday season were busy getting their homes ready for being shown.  We have lots of homes in the pending status.  Next month will see an increase in solds and that is a good thing.  Remember the solds reflect a purchase of 30 days earlier or more. 

Have a great weekend, enjoy and be safe with all the Super Bowl parties. 

  Sept – 07 Oct – 07 Nov – 07 26-Nov-07 2-Jan-08 1-Feb-08
Total Active Listings       568 523 578
Single Family Homes       264 246 277
Patio/Town/Gemini Homes       168 153 157
Apartment style Homes       136 124 144
             
Total Pending Listings       51 36 57
Single Family Homes       21 19 36
Patio/Town/Gemini Homes       17 11 17
Apartment style Homes       13 6 4
  Sept Oct Nov   Dec Jan
Total Sold  33 34 36   38 29
Single Family Homes 19 20 14   17 14
Patio/Town/Gemini Homes 6 7 10   11 11
Apartment style Homes 8 7 12   10 4