How’s the market?

I guess you could ask 100 Realtors this question and get 100 different answers. Even agents in the same geographic area will have varying responses. Here’s what I think based on what I have been experiencing.

In the Treasure Valley, the market is improving.  That is not to say that we don’t have our fair share of distressed properties. We do. It also doesn’t mean that home prices are soaring, but in some areas prices appear to be stabilizing and even rising slightly. The market is interesting to say the least.  According to January numbers from the Intermountain MLS for the last three years, the percentage of Active Properties (listed for sale) vs. Pending Properties (under contract and waiting to close) has significantly improved.  Also, notice that the inventory is very low. This means that quality homes that are priced right are selling more quickly.

New Construction Numbers:

          Active          Pending

01/2010     1582             200           13% pending

01/2011     1298              145            11% pending

01/2012     1014             198             20% pending

Existing Home Numbers:

         Active            Pending

01/2010      8362              1285          15%  pending

01/2011       7228              1190          16%  pending

01/2012      4885               1470         30% pending

The biggest complaint I hear from agents these days is about lack of inventory.  The buyers are out there, and why not? Prices are good and interest rates low.  The problem is that there isn’t much to buy.  Well qualified buyers are waiting for “the house” to come on the market. It seems sellers are holding tight. Perhaps they think that prices will increase, or maybe they are just afraid to find out what their home is worth.

As a Realtor, all I can do is spread the word that buyers are waiting – perhaps for your home! It would be nice if we could get sellers back into the game.

Sell Now or Wait for Spring?

This is the time of year when perspective sellers start to ask the question, “Should we list our home now or wait until next spring?” It is a question worth considering in Boise where the winters can mask some of a homes features. So, what is the answer? It depends.
Real estate is somewhat seasonal in Idaho with more homes being sold in the spring and summer than in the winter. There are several factors that make this true. It does not, however, mean that homes don’t sell in the winter. They absolutely do. People move all year. And, if you are a seller, there is less competition.
To determine what is right for you, ask yourself the following questions.
Does your yard greatly enhance the appeal or value of your property?
Is your house show ready, or do you need time to make repairs, paint, or deep clean the house?
Are you willing to risk what the market may or may not do between now and next spring?
The answers to these questions should help you decide if now is the time to list or not. Remember that people do move in the winter and, if your home isn’t listed, you can be sure it won’t be shown.

Changing Values, Changing Venues (Part II – Renovating)

In part one of this blog I spoke about the exodus from the suburbs and the current thinking that makes living close to where you work and play so desirable.  Commuting adds a big expense to the monthly budget as well as adding to ones carbon footprint.

 

If you want to live close to downtown Boise, there is a good chance you’ll end up in an older home in one of Boise’s established core neighborhoods.  Many of the close-in neighborhoods (North End, East End, Northwest and the Bench) consist largely of homes dating from the mid 1900’s back to the turn of the century.  These homes have character that many find pleasing, but they often lack some modern conveniences that homeowners have come to expect.  This is why many people choose to remodel these older gems.

 

With society’s increasing emphasis on sustainability and our awareness of more eco-friendly materials, these remodels can accomplish several things.  First, they can make an older home function in a way that works for modern life.  A good remodel can increase the appeal and value of a home while, at the same time, it can make it a more efficient and healthier place to live.  Your remodel can save you money as well as help you stay healthy. 

 

Naturally, there are costs involved with every remodel decision you make. However, you might be surprised at how many of the choices you make can be eco-friendly for about the same price as less sustainable choices.  Energy Star appliances, low-flow faucets, sustainable floor coverings and more are priced competitively with less eco-friendly choices.  Plus, when you factor in the usage savings plus any tax benefits, I’m sure you’ll find that they are a true value.

 

Here are a few examples based on a 2500 sq. ft. home.

 

Payback Time in Years:

Added Cost:

Annual SAVINGS

10 Year SAVINGS

 

Programmable Thermostat	0.6	$115	$180	$1,800
Compact Fluorescent Lighting	0.8	$60	$80	$800
Shower Heads	0.9	$180	$300	$3,000
Water Efficient Toilets	2.0	$50	$25	$250
Windows	2.3	$700	$300	$3,000
Whole House Fans	3.6	$450	$125	$1,250

 

Info courtesy of http://www.greenandsave.com  Find complete list here

 

During the current economic situation, home prices in these core neighborhoods have remained more stable than those in communities further from the downtown area. If you are thinking of moving to one of these neighborhoods, or if you are lucky enough to already own a home in one of them, remodeling might make sense for you. Let me know if I can help by referring you to a trusted contractor or vendor who is well qualified to help you achieve your dream.

 

Changing Values, Changing Venues (Part I-Commuting)

 

“Home is where the heart is,” but the location of that heart appears to be changing.  U.S. homeowners have had a love affair with the suburbs since the late 1940’s when troops returned from WWII.  Single family homes with big yards and lawns have been all the rage for over a half century.  Now, the pendulum is starting to swing in the other direction.  More people are choosing to live closer to where they work, shop and play. Why? I believe the two biggest reasons are the growing concern for the planet and the current economic situation.

 

What do subdivisions have to do with the rising green consciousness and the economy?  Well, everything.  Let’s start with one of the most obvious answers; commuting. According to DowntownBoise.org (thank you @unequivocal208), over 36,000 employees work downtown every day. As of 2003 (Capital City Development Corp.), there were only 2000 dwelling units downtown.  The rest of the workforce was commuting from outside the downtown area.  When gas hit $4 per gallon, commuters took notice.  Even with the lower cost of fuel today, the cost of commuting really adds up. Here is an example:

 

Homeowner A lives 20 miles from work.  He bought a home for $250,000.  He earns $50,000 per year, drives a $20,000 car that gets 20 mpg. His mortgage is at 5% and he pays $2.90 per gallon for gas.

 

Homeowner B lives 2 miles from work.  She paid $300,000 for her home.  All other factors are identical to Homeowner A.  They each make 22 commutes to work per month.

 

Here is the financial breakdown:

 

Homeowner A:

Monthly Payment on House B: $1,342.05
Loan Amount: $250,000
Monthly Fuel Cost: $127.60
Monthly Maintenance Cost: $211.20
Monthly Time Cost: $488.89
Total Monthly Cost: $2,169.74

 

Homeowner B:

Monthly Payment on House A: $1,610.46
Loan Amount: $300,000
Monthly Fuel Cost: $12.76
Monthly Maintenance Cost: $21.12
Monthly Time Cost: $48.89
Total Monthly Cost: $1,693.23

 

You can fill in your own information here.

 

When you take this information and combine it with the fact that Homeowner A is adding approximately 900 lbs of CO2 emissions per month compared to Homeowner B’s 82 lbs just from driving to work, the picture becomes even clearer.  Commuting takes its toll on the planet as well as the wallet.  It is not necessarily less expensive to move farther away from work to buy in a less expensive area.

 

What does this mean for Boise real estate?  The popularity of Boise’s core neighborhoods (those in close proximity to downtown) will keep rising.  Homes in these areas will continue to be more expensive and will hold their value better than those that are further away from amenities.  People will keep remodeling and renovating the older, close-in neighborhoods and we will see more people choosing to live in downtown condos.

Smaller Homes Make Big Sense

According to The Idaho Statesman, McMansions are on their way out. To this I say, “Good riddance!” For some reason, the keeping-up-with-the-Joneses mentality seems to have overridden common sense in the recent past with respect to home size. People believed they hadn’t made it unless they lived in 4000 square foot homes with vaulted ceilings. Whether the economy or greener values or a combination of the two have been responsible for the shift, the good news is that we are seeing a change.

Huge homes mean added expense. Upkeep runs much higher, as do utility bills. These too large homes are big polluters as well as space wasters.  More people are realizing that they can be happy in much less space in part thanks to books like The Not So Big House by Sarah Susanka. This series of books helps people learn how to utilize fully the space they have. We don’t need bigger; we need better planning.

Locally, we still have a long way to go in embracing this smaller-can-be-better lifestyle choice. Although builders are building smaller homes in some price ranges, it is still nearly impossible to find small higher end homes. Builders will eventually realize that even people with the money for high end upgrades don’t necessarily want a bunch of extra space.  Currently in Boise, anyone looking for a high-end, smaller home option is relegated to condo living or a custom build job.  Hopefully, more people will get on the not-too-big bandwagon and options will expand to include reasonable sized, higher end single family houses.

What is a good real estate deal (and how do I get one)?

There are absolutely fabulous deals right now if you are looking to buy a home or investment property in Boise, Idaho. Prices are down, and sellers need to compete with short sales and REOs (bank-owned properties) if they want to sell. The question is how do you compare homes and find the real deal?

First, decide exactly what you are looking for. This “dream list” should include area, home features and size. Realize that you may not get everything on your list, but it is a place to start. Enlist the help of an experienced Realtor® who can help you find the homes you’ll want to look at and begin your search. Your agent should also refer you to several lenders to get pre-qualified for a loan. The best deals definitely go to those who are prepared.

When comparing properties and prices, there are many things to keep in mind. Every home is different, and value must be measured keeping those differences in mind. Two 1500 square foot homes may have wildly different prices, but it doesn’t mean that the less expensive of the two is the better deal.

The biggest factor affecting pricing is location. You will pay much more per square foot in East Boise or the North End than you will in West Boise. The next thing to consider is what updates have been made. If you are looking at an older house, have the electrical & plumbing systems been improved? Is the kitchen remodeled? The bathrooms? How old are the roof and the HVAC system? How much work (read money) will you need to put in to get the home into the shape you want? There are other factors that need to be considered as well. Your agent can help you identify and research these.

Once you have found the right property, it’s time to craft an offer. This is where a good agent’s skill really comes into play. A well-planned offer will save you money and frustration. Your agent should prepare a market analysis of the home. Together, you can study the comparables and decide what a reasonable price would be. You can discuss the best way to approach your offer by taking into consideration things like how long the property has been on the market, what competition it has and the condition it is in.

Your agent should present the offer and be prepared to negotiate on your behalf if there is a counter offer. She will also use those negotiating skills to get the seller to pay for repairs needed once the inspection has been completed. She will be able to discuss with you the pros and cons of asking for seller concessions and get you past small things that should not be deal breakers.

Just looking for the lowest priced home is not the way to find the best real estate deals. It takes work, but by teaming with a professional and doing some groundwork, you can find the perfect property and get it for a great price.

Save Some Green

Everyone knows some ways to add energy savings to their home. Insulation, Energy Star appliances, upgraded windows and switching to compact fluorescent bulbs might save you some money, but how much?  Instead of throwing money at updates that may or may not help you save energy, why not have an energy audit?

An energy audit will help you determine what the big energy offenders are at your house. Along with the auditor, you can formulate a plan and a budget to handle your energy saving updates. The auditor can tell you how much you will save and how long it will take a particular item will take to pay for itself.  You might be surprised at what really makes the biggest difference.

When looking for a new home, why not have an energy audit as part of your inspection? A list of items not usually checked will give you negotiating power. You can even ask the sellers to make repairs that will help keep your expenses down.

If you are interested in having an audit done on your current home or if you are planning a move, give me a call. I can get you set up with a professional energy auditor.