About Eaton County, MI

I would like to start off by saying that every situation is different, however, I feel the new tax credit is not a good thing for the majority of home buyers. There I said it, let the comments come rolling in...... or read on and hear my take.

When President Bush signed Housing Stimulus Bill into Law last month, a tax credit was given to any home buyer that has not owned a home in the last three years, great right? Well yes and no. I have started to see different lenders and real estate companies advertising this, as if the government just cuts you a check, no where do you see the downside of this. I fear that buyers will see "Free Money" and put themselves into a situation that does not make the most economic sense for them.

According to National Association of Realtors the $7,500.00 tax credit is repayable over 15 years. Yes it would be very similar to an interest free loan with $500.00 a year payments for 15 years. Do I think this tax credit will be successful... yes, but I also think that buyers, Real Estate Agents, Lenders and Accountants must do there due diligence to educate buyers before they take advantage of this credit. The most overlooked point of this credit that I noticed is the recapture upon sale. Yes possible bad news for a good thing. Let's say for example a home buyer is to purchase a home and receive the maximum tax credit of $7,500.00. Then two years later their situation changes and they are forced to sell. They will be responsible for $6,500.00 to the government. In most situations sellers will be upside down when selling their home after two years in the current market. With the tough economic times can a Buyer afford to risk adding more to that? I don't know, I don't have all the answers but I feel this is a point where our industry needs to step up and inform our clients of the possible ramifications of it. Another key point to the Housing Stimulus package was prohibiting Down Payment assistance programs such as Genesis and AmeriDream; I look at the Tax credit as a similar demon. Buyers take their savings to put the money down to buy a home knowing that come tax time they will get $7,500 back. Essentially they are back to no money down again, except owing the Federal Government $500.00 a year over the next 15 years.

Again, I think that if an educated buyer makes an educated decision to use the tax credit, that is their prerogative, we as an industry must make it a point to educate, not use the "Hook" of a $7,500 tax credit to get a sale.

The REAL Truth About Trends in Sales Prices in Grand Ledge, Michigan

Mary Ann Heindorf, Realtor, E Z Home Ownership Realty, LLC, Grand Ledge MI

3-7-08

(This is a series of many upcoming posts to analyze the ACTUAL TRENDS in SALES PRICES in the Greater Lansing Area. )

WHY I DID IT:

As well as being a Realtor, I am an analytical chemist and I analyze trends in data all day long. I thought I would share a recent data analysis project that I started working on shortly after the article came out in the Lansing State Journal (LSJ) indicating that 4th quarter 2007 home prices in Lansing fell more than anywhere in the nation. Because trends in real estate are heavily influenced by the location and price points in that particular market, I decided to query the Multiple Listing Service (MLS) by area to better identify changes over time in individual areas in Ingham, Eaton and Clinton Counties. We all know the three most important rules for investing in real estate are location, location, location. Articles like the one in the LSJ totally ignored that basic tenet of real estate.

WHAT I DID:

I started with the area that is defined by the Multiple Listing Service (MLS) as Grand Ledge. To compare with the 4th quarter statistics cited by the LSJ, I queried ALL properties sold in Grand Ledge from October 1 through December 31 for as many years as there was data in the property search portion of the MLS. I exported the data to excel and calculated the average and median values for each 4th quarter data set. I also calculated the standard deviation and various percentiles to provide an idea of the distribution of the data points around the mean, also called average. I didn't include any descriptive statistics here.

Also, to answer the question, how much of an impact are foreclosed properties having on the average and median values in the area, I identified as many REOs using both the style fields in the MLS and my knowledge of the specialties of various listing agents. I removed the REO's and re calculated the median and average prices. REO stands for Real estate Owned by a lender. These are homes that have been foreclosed.

WHAT THE DATA SHOW:

From the 4th quarter 2002 through the 4th quarter 2007, the average sales price of homes in Grand Ledge rose from $173,870 to $188,221. This is an increase of almost 4%, not the decrease described by the Lansing State Journal. The median is lower than the average for most years, and falls lower in the 4th quarter of 2007. However, the total number of homes sold in the 4th quarter of 2007 is 44, so, as you say, the median can become skewed by an outlying data point, such as an REO. The important number is the average which shows an increase in value. Evan Vanderway does a nice job explaining the difference between average and median in his recent post. I included the median here to follow up to Evan's post. Figure 1 shows a plot of the data. A maximum value was reached in the 4th quarter 2005 when the average exceeded $197,000, which is about a 5% spike. All in all, this set of data DO NOT indicate a plummeting in home values in Grand Ledge.

To determine the impact the sales prices of foreclosed homes would have on the overall average sales prices in the area, the REO's were removed from the data set. The average sales price rose from $174,478 to $194,126, indicating appreciation from 2001 to 2007. Again, it's the average you want to watch. The maximum value in 2005 reached $202,770, which is really quite close to the 4th quarter average in 2007 of $194,126, indicating good stability in the market for the last 3 years, not the decline blasted across the front pages of the LSJ.

As I have time, I will continue to investigate changes in sales prices in various locations through the greater Lansing area. I hope you will find the data useful.

Are you thinking of buying or selling Eaton Rapids, MI Real Estate?

Before you do know your numbers. Here are the Active, Pending and Sold Statistics for Eaton Rapids, MI over the last 30 days.

• 169 Active listings in Eaton Rapids
• 18 Pending sales
• 5 Homes have sold in the last 30 days

If you are thinking of selling your Eaton Rapids, MI home be prepared to be the best. With over 33 months of inventory currently on the market buyers have the upper hand. You not only need to be priced right you need to take the time to have your home in the best condition possible.

If you are looking to buy Eaton Rapids, MI real estate now couldn't be a better time!

Regardless if your buying or selling make the first step by hiring great representation for your first or next real estate transaction! The Robert Dowding Team at Keller Williams Realty is here to help you every step of the way!

If you would like more detailed information about your specific area contact "THE ROBERT DOWDING TEAM" today to schedule your personal consultation.

If you are looking to buy and would like more specific information you may search online at www.RobertDowding.com or contact us to schedule a buyer consultation and set up your personal search criteria that will auto notify you as new houses are listed that match your criteria.

• 517.853.6390 Office
• 866.206.5926 e-Fax
• Sold@RobertDowding.com
• http://www.robertdowding.com/

Right now in Delta Township there is an excellent selection of inventory to pick from on some great homes. Interest rates dropped below 6% last week to put a spark of enthusiasm into the market and increase hits on most real estate websites. If your thinking of moving to Delta Township area make sure you check out the opportunities offered by the Delta Parks and Rec Department. Enrichment classes for kids and adults of all ages. You'll also find some information about Delta Township's greener awareness program and recycling program. Delta Township is also connected to two great school systems, Grand Ledge and Waverly. If you are looking for demographics about the community and desire additional information feel free to contact me or visit my website.

"Expect the Best" Mike