Low Inventory Causes Home Prices to Accelerate

The National Association of Realtors (NAR) released their latest Quarterly Metro Home Price report earlier this month. The report revealed that home prices are not only continuing to rise but that the increases are accelerating. Lawrence Yun, Chief Economist at NAR, discussed the impact of low inventory on buyers in the report:

“Without a significant ramp-up in new home construction and more homeowners listing their homes for sale, buyers are likely to see little relief in the form of slowing price growth in the months ahead.”

Here are the percentage increases of home prices for the last two quarters:

inventory

What this means to sellers

Rising prices are a homeowner’s best friend. As reported by CoreLogic in a recent blog post:

“With demand strong and inventory thin, the share of homes selling for the list price or more has also returned to pre-bust levels. With inventory tight, homes are more likely to sell above the asking price.”

What this means to buyers

In a market where prices are rising, buyers should take into account the cost of waiting. Obviously, they will pay more for the same house later this year. However, as Construction Dive reported, the amounts of cash necessary to buy a home will also increase.

“These factors have created a situation where the market keeps moving the goalposts in terms of the down payment necessary for first-time homebuyers to get into a home.”

Bottom Line

If you’re thinking of selling and moving down, waiting might make sense. If you are a first time buyer or a seller thinking of moving up, waiting probably doesn’t make sense.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Mortgage Rates at Historic Lows

mortgage rates low

Mortgage Rates Low Again

A couple of weeks ago, we posted an article discussing where mortgage rates may be heading over the next twelve months. We quoted projections from Fannie Mae, Freddie Mac, the Mortgage Bankers’ Association and the National Association of Realtors. Each predicted that mortgage rates would begin to rise slowly and steadily throughout 2016.

However, shaky economic news and a volatile stock market have actually caused mortgage rates to drop six out of the last seven weeks, and have remained at 3.65% for the past two weeks.

30yr mortgage rateRates have again fallen to historic lows yet many experts still expect them to increase in 2016. The only thing we know for sure is that, according to Freddie Mac, current rates are the best they have been since last April.

Bottom Line

If you are thinking of buying your first home or moving up to your ultimate dream home, now is a great time to get a sensational rate on your mortgage.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Will Appraisals Continue to be a Challenge in 2016?

appraisal challenge

First American Title issues a quarterly report, the Real Estate Sentiment Index (RESI), which “measures title agent sentiment on a variety of key market metrics and industry issues”. Their 2015 4th Quarter Edition revealed some interesting information regarding possible challenges with appraisal values as we head into 2016.

“The fourth quarter RESI found that title agents continue to believe that property valuation issues will be the most likely cause of title order cancellation over the coming year.”

This shouldn’t come as a surprise. In a housing market where supply is very low and demand is very high, home values increase rapidly. One major challenge in such a market is the bank appraisal. If prices are jumping, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that closed recently) to defend the price when performing the appraisal for the bank.

Another monthly report by Quicken Loans measures the disparity between what a homeowner believes their house is worth as compared to an appraiser’s evaluation. Here is a chart showing that difference for each month through 2015.

appraisalsBottom Line: Every house on the market has to be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. That is why we suggest that you use an experienced real estate professional to help set your listing price.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Monthly Real Estate Market Videos

Monthly Real Estate Market Videos for: Hilton Head, Bluffton, Daufuskie & Okatie

Did you know that we offer monthly real estate videos for Hilton Head, Bluffton, Daufuskie and Okatie?

Each month we offer the opportunity for you, the buyer or seller, to get a better idea what is happening in your local real estate market. The market between Hilton Head and Bluffton is very different. Just as the market between Bluffton and Okatie is different. Why settle for generic information that may not be localized enough for you? When you can come to us and get the local monthly real estate market videos that you need!

The Hilton Head Monthly Real Estate Market Video can be found by clicking here

The Bluffton Monthly Real Estate Market Video can be found by clicking here

The Daufuskie Monthly Real Estate Market Video can be found by clicking here

The Okatie Monthly Real Estate Market Video can be found by clicking here

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

You Do Need the Internet to Sell your Home

You do need the internet to sell your home

In 2016, you do need the internet to sell your home.

Trust your real estate agent to get your listing online. The internet continues to drive the most amount of home buyers every year and there is no reason to believe this percentage won’t raise even more in 2016. As a result you do need the internet to sell your home.

As you can see from the above infographic if your listing isn’t online you are missing out on an amazing opportunity. It is just beyond being on the internet though. Are you online in the right places? Is you listing being pushed and shared to the best sites that generate foot traffic? Don’t miss this opportunity to get your listing seen and your home sold!

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!
With over 25 years of experience, our team is ready to help!
Hilton Head Real Estate Partners

Partnering with you every step of the way.

Consider Cost Not Just Price

Screen Shot 2015-12-14 at 9.30.02 PMConsider Cost v. Price

As a seller, you will be most concerned about ‘short term price’ – where home values are headed over the next six months. As a buyer, you must consider cost not just price. That means you need to be concerned not about price but instead about the ‘long term cost’ of the home.

The Mortgage Bankers Association (MBA), the National Association of Realtors, Fannie Mae and Freddie Mac all projected that mortgage interest rates will increase by about three-quarters of a percentage point over the next twelve months. According to CoreLogic’s most recent Home Price Index Report, home prices will appreciate by 5.2% over the next 12 months.

What Does This Mean as a Buyer?
Above is a simple demonstration of what impact an interest rate increase would have on the mortgage payment of a home selling for approximately $250,000 today if home prices appreciate by the 5.2% predicted by CoreLogic over the next twelve months.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Mortgage Rates are Going Up – Move Now

mortgage-ratesHistoric Low Mortgage Rates May be Coming to a Close

Freddie Mac’s Primary Mortgage Market Survey shows that mortgage rates for a 30-year mortgage have started to inch up, most experts predict that they will begin to rise even more over the next 12 months.

An increase in rates will impact YOUR monthly mortgage payment. Your housing expense will be more a year from now if a mortgage is necessary to purchase your next home.

With that said the big question is:

Should I Pay An Interest Rate Over 4%?

Mortgage interest rates, as reported by Freddie Mac, have increased over the last several weeks.

This has caused some purchasers to lament the fact they may no longer be able to get a rate less than 4%. However, we must realize that current rates are still at historic lows.

Though you may have missed getting the lowest mortgage rate ever offered, you can still get a better interest rate than your older brother or sister did ten years ago; a lower rate than your parents did twenty years ago and a better rate than your grandparents did forty years ago.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Two Reasons to Sell This Winter

Should you Sell this Winter?

The last two major reports (Pending Home Sales and Existing Home Sales) issued by the National Association of Realtors (NAR) revealed information that suggests that selling this winter may be your best move.

Pending

The Pending Home Sales Report

The report announced that pending home sales (homes going into contract) are up 3.9% over last year, and have increased year-over-year now for 14 consecutive months.

Lawrence Yun, NAR’s Chief Economist, expects demand to remain stable through the final two months of the year, and “forecasts existing-home sales to finish 2015 at a pace of 5.30 million – the highest since 2006.”

Takeaway: Demand for housing will continue throughout the end of 2015 and into 2016. The seasonal slowdown often felt in the winter months hasn’t started and shows little signs of being near – even more reason to sell this winter.

ExistingThe Existing Home Sales Report

The most important data point revealed in the report was not sales but instead the inventory of homes on the market (supply). The report explained:
•    Total housing inventory decreased 2.3% to 2.14 million homes available for sale
•    That represents a 4.8-month supply at the current sales pace
•    Unsold inventory is 4.5% lower than a year ago

When there is less than 6 months inventory available, we are in a sellers’ market and we will see appreciation. Between 6-7 months is a neutral market where prices will increase at the rate of inflation. More than 7 months inventory means we are in a buyers’ market and should expect depreciation in home values.

As rents and prices increase, potential buyers will not able to save as much for a down payment and many may become priced out of the market.

Takeaway: Inventory of homes for sale is still well below the 6 months needed for a normal market. Prices will continue to rise if a ‘sizeable’ supply does not enter the market. Take advantage of the ready willing and able buyers that are still out looking for your house.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

For Sale By Owner May Hurt Your Sale in the End

FSBO

For Sale by Owner Isn’t As Easy as it Looks

In today’s market, with home prices rising and a lack of inventory, some homeowners may consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). There are several reasons this might not be a good idea for the vast majority of sellers.
Here are five reasons:
1. There Are Too Many People to Negotiate With
Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale By Owner:
•The buyer who wants the best deal possible
•The buyer’s agent who solely represents the best interest of the buyer
•The buyer’s attorney (in some parts of the country)
•The home inspection companies, which work for the buyer and will almost always find
some problems with the house
•The appraiser if there is a question of value

2. Exposure to Prospective Purchasers
Recent studies have shown that 88% of buyers search online for a home. That is in comparison to only 21% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you?

3. Results Come from the Internet
Where do buyers find the home they actually purchased?
•44% on the internet
•9% from a yard sign
•33% from a Real Estate Agent
•1% from newspapers
The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

4. FSBOing has Become More and More Difficult
The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

5. You Net More Money when Using an Agent
Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real estate agent’s commission. The seller and buyer can’t both save the commission.
Studies have shown that the typical house sold by the homeowner sells for $209,000, while the typical house sold by an agent sells for $235,000. This doesn’t mean that an agent can get $26,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

Bottom Line
Before you decide to take on the challenges of selling your house on your own, sit with a real estate professional in your marketplace and see what they have to offer.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.

Don’t Wait – Buy Now!

Don't pay more, buy now

Don’t Wait – Buy Now

Buy now to keep costs down on the house of your dreams. As you can see each state is appreciating at different rates. South Carolina is appreciating at one of the highest rates in the States year-over-year. Waiting for that right moment may wind up costing you more than you thought. Don’t wait, buy now!

Add that interest rates will most likely be going up in 2016 and waiting will cost you more than it has in the past couple of years. Don’t miss out on a great opportunity to find your perfect home.

The October numbers reinforced the facts that the real estate market continues to gain strength:

  • The annual adjusted sales are currently at a 5.36 million pace.
  • 14,684 homes sell every day in the United States.
  • October marked the 44th consecutive month of price gains.

If you are interested in where the Bluffton / Hilton Head Island real estate market is going? Give Jo Anne or Tony Rizza (843-301-5825) a call to better understand the current market, see the latest available properties, or to list your own home!

With over 25 years of experience, our team is ready to help!

Hilton Head Real Estate Partners
Partnering with you every step of the way.