I know this comes as no surprise but, right now is a better time if any to buy a home. With interest rates so low and mortgage payments compareable to rent in the area it would be crazy not to own a home and give the landlord back his rent keys, and buy today!
Call me. Tayona Tate (775) 762-8355.
Housing data for Washoe County in April from the Reno/Sparks Association of Realtors.
» $155,000: The median price for an existing single-family home. The price is down 3 percent from March and 14 percent from April 2010.
» 422: The number of existing single-family homes sold. Sales numbers are down by 17 percent both month-over-month and year-over-year.
A used Lamborghini. Jessica Simpson's engagement ring. A high-end Christian Dior wedding gown.
Those are just a couple of things you can get for $100,000 these days.If you're like most normal folk, however, you'll likely be plunking a hundred grand into a more conventional big ticket purchase. And for the average person, a house usually fills the largest single purchase made in a lifetime.With the U.S. housing market seeing one of the steepest declines in history in the last few years, $100,000 doesn't just buy what it used to in 2005. It buys a heck of a lot more.In 2005, for example, only four homes in the $100,000 and under price range -- all condominiums -- were sold in Stead during the first six months of the year. This year, 97 homes were sold in that price range within the same time period in Stead, which has turned into a hotbed for existing home sales.Chalk it up to a market with no shortage in distressed and suddenly affordable homes."The general rule of thumb we tend to use now is to take the price during the housing boom and cut it in half," said Ken Wiseman, broker-owner of Reno Rancho Realty.In short, a thousand Benjamins have a lot more homebuying power now than they did when Reno was one of the hottest real estate markets in the country. Depending on your point of view, that's either a good thing or a bad thing.THEN AND NOW
A key difference between a $100,000 home in 2005 and one in 2011 often boils down to two things: size and age.One of the four aforementioned $100,000-and-under condos that sold in 2005 for example was a 1,128 square-foot unit in Stead with two bedrooms and one-and-a-half bathrooms. It was built in 1979.In contrast, a comparably priced unit that sold this year in Stead was an existing single-family house with 2,130 square feet of space, four bedrooms, two-and-a-half bathrooms. The house was built in 2005.The change is reflected in the average price per square foot, which used to be about $104 during the boom years. These days, it's down to $72."In the heyday (of the local housing market), the homes in the $100,000 range were much older and built in the '70s and '80s," said Sherrie Cartinella, president of the Reno/Sparks Association of Realtors. "Now you can find homes built in 2004, 2005 and even newer than that, which have better features and are built with newer materials. And you're getting a lot more square footage, too."
Add high inventory to the mix and you have a wide selection of homes for entry-level buyers who were priced out of the market during the boom years. A large part of the demand is being driven by first-time homebuyers who have figured out that monthly mortgage payments for an entry level home can be lower than renting. Investors are getting into the act as well."Some of these properties are producing cash flow equaling a return of 6 to 11 percent, which you can't find anywhere else," Wiseman said.But just as buyers are in the driver's seat in this market, sellers are in a tough and unenviable position."When buyers have more choices, it's not so great for the seller," said Amy Shocket, a broker-salesperson for Dickson Realty. "A seller has to make sure their property is competitively priced and in good condition. It's like a horse race and a beauty contest at the same time. You have to look good and come out of the gate fast."Times are especially tough for homeowners who are selling a non-distressed home, given the pricing pressures they face from foreclosed and short sale properties. Expecting homeowners who kept their home in good shape to match the price of a distressed home is unfair, said Margaret Palmer, a real estate agent with Coldwell Banker Select."Short sales and foreclosures are really hitting these homeowners hard," Palmer said. "The fact that a home is in immaculate condition and isn't a foreclosure or short sale really should be considered when determining a home's value. You should get more value for a regular sale."JUNE BUG?
Despite their advantages, however, buyers still have their share of challenges in today's housing market.
One involves stricter guidelines to qualify for a home loan. The tenuous job market also means homebuyers should make extra sure that they an afford making payments on a new house, Shocket said.
"Prices may be very attractive but you still have to be in good financial position to buy a property," Shocket said. "First-time homebuyers can especially get a little emotional and don't look at what a purchase will really cost them, which is what caused (the housing collapse) in the first place."Also, while May posted strong sales numbers, June is surprisingly off to a lackluster start, Wiseman said. Part of it could be the bad weather, which is discouraging people from house hunting, Wiseman said. Another reason could be recent reports about a double-dip in home prices, which is discouraging potential buyers."This is supposed to be the busiest time of the year but the last two weeks have gone pretty quiet," Wiseman said. "A lot of buyers are just retracting again."Concerns about home values falling further are understandable with regard to mid-range and high-end homes, Wiseman said. One reason involves the potential for more "strategic defaults" from underwater homeowners who decide to walk away from their mortgages despite being able to afford their monthly payments. Shadow inventory also remains a concern in the mid-range and high-end housing markets, Wiseman added.The housing market in the $100,000-and-under range, however, shouldn't see any more large drops in price, Wiseman said."That part of the market has pretty much stabilized," Wiseman said. "It might go down a little bit more but it won't be anything dramatic. You really can't go much lower."
One involves stricter guidelines to qualify for a home loan. The tenuous job market also means homebuyers should make extra sure that they an afford making payments on a new house, Shocket said.
"Prices may be very attractive but you still have to be in good financial position to buy a property," Shocket said. "First-time homebuyers can especially get a little emotional and don't look at what a purchase will really cost them, which is what caused (the housing collapse) in the first place."Also, while May posted strong sales numbers, June is surprisingly off to a lackluster start, Wiseman said. Part of it could be the bad weather, which is discouraging people from house hunting, Wiseman said. Another reason could be recent reports about a double-dip in home prices, which is discouraging potential buyers."This is supposed to be the busiest time of the year but the last two weeks have gone pretty quiet," Wiseman said. "A lot of buyers are just retracting again."Concerns about home values falling further are understandable with regard to mid-range and high-end homes, Wiseman said. One reason involves the potential for more "strategic defaults" from underwater homeowners who decide to walk away from their mortgages despite being able to afford their monthly payments. Shadow inventory also remains a concern in the mid-range and high-end housing markets, Wiseman added.The housing market in the $100,000-and-under range, however, shouldn't see any more large drops in price, Wiseman said."That part of the market has pretty much stabilized," Wiseman said. "It might go down a little bit more but it won't be anything dramatic. You really can't go much lower."
No comments:
Post a Comment