John Schoenherr

It seems like the real estate market is in a pivotal state right now. In the Dells area we had a very active December, a slow January and we have seen some pick up in the market in February. Year to date 18 properties sold in this area compared to 14 sales last year. There are 14 accepted offers in process indicating that March sales should be above last year's number. These numbers show year to year growth, but at a snails pace.

What is most concerning are the 700 properties currently on the market for sale. At the current rate of sales it would take many years for all of these properties to sell, just too much inventory. The breakdown of the listed properties is 200 single family (many are mfg homes which are tough to sell) 150 condo's and 330 lots/acreage properties.

For buyers these are great numbers. Combine the high inventory with low mortgage interest rates and the income tax credits being offered, this is a great time to buy.

For existing home owners who plan to upgrade their primary residence, this is also a great time to buy. Expect to sell your existing home for less, but you will also be buying your larger home for less. The numbers work out in your favor and you may also be eligible for the $6,500 income tax credit if you have lived in your existing home 5 out of the past 8 years.

For sellers, it is time to be serious about selling. Don't put your property on the market unless you want to sell. Be prepared to sell for less than you think your property is worth. In this market, to list your property for sale over market value means it will just sit there and clog up the unsold inventory.

In Wisconsin there are many pre-built homes that are used as vacation homes as well as permanent residences. Often these homes are called mobile, modular or manufactured interchangeably, but they are very different in construction and use. The 2009 market has seen a reduction in interest by lenders to provide mortgages for some of these homes and it is therefore important to be able to recognize one from the other.

A mobile home is just that - mobile. It will have an axle with wheels and a tow bar that allows it to be moved from location to location. These homes are titled as personal property and are not real estate. In Wisconsin, a Realtor can only sell two of these properties per year.

A manufactured home also had an axle with wheels and was towed from the factory to the dealer. When purchased from a dealer the unit is towed to the building site and permanently placed on a foundation system. The axle, wheels and tow bar are removed. Since 1976 these homes have been built to HUD standards and have a HUD identification number assigned. There are HUD plates attached to the outside wall that must be kept on the unit. When sold, the appraiser will be required to take a picture of the HUD plates as part the real estate appraisal. Manufactured homes can be one unit (single wide) or two units (double wide). There will be a HUD plate and ID number assigned and affixed to each unit.

Manufactured homes are originally titled as personal property and given a title similar to any trailer that travels on the roadways. When placed on the foundation the house becomes real estate and should be newly titled as real estate. It is very important to keep all of the original paperwork and titles that come with the new manufactured home. Upon resale the lender may require that the owner be able to prove that the home was moved to its current location new. Many lenders will not offer a mortgage for a manufactured home that has been relocated. The dealer should provide a certificate of origination upon sale and that certificate will be required by the appraiser upon resale.

Modular homes, in Wisconsin, are considered the same as custom (stick built) homes. They are built in sections at the factory, delivered by truck to the building site and assembled. These homes are built to local zoning codes and are subject to the same inspections as a custom built home. Most lenders underwrite modular homes the same as custom built homes.

In the state of Wisconsin there are many manufactured homes and in the counties that I focus on, Adams and Juneau, manufactured homes are a large percentage of the homes available. Many of these homes are vacation homes and because of the low purchase cost and the ease of constructing, it just made sense for the owners to purchase a manufactured home.

But, this year, there has been a stigma attached to these homes, primarily by the Home Mortgage Insurance companies (PMI) who are not offering mortgage insurance on loans with less than a 20% down payment. Because mortgage insurance is not available, lenders in Wisconsin are not offering conventional mortgages; which all makes sense. However, mortgage loans are available for these properties through FHA and VA. These loan programs are available for no down payment (VA) or as little as 3% down for a FHA loan.

My point here is that if your buyer is interested in a manufactured home there is no reason to turn them away, which is what some lenders and Realtors are doing. It does take more time to find a lender who participates in a VA or FHA approved program, but the money that your buyer can save on these properties is well worth the effort.

Part of the issue with manufactured homes was the quality of construction. However, homes built after 1976 must have conformed to more stringent HUD building codes and these properties are very well built. Homes that have been built recently have 6x6 stud construction, improved electrical and plumbing and are very attractive real estate options. So, when you find a manufactured home on your property search don't automatically skip it. Do your buyer a favor and take a closer look.

My market is the Wisconsin Dells area and a popular local paper is the Wisconsin Dells Events. On Saturday, January 3^rd the front page article was titled "Housing not selling like it used to". There was a large picture on the front page associated with the article of a house with a For Sale sign from my office. It was not my sign but it was one of my associates. She was not interviewed for the article. Instead the reporter chose to interview 3 other Agents. The jist of the article was that the market was in bad shape. One of the agents interviewed made a statement that 2008 has been the worst year for him in his 35 years of selling.

I just do not know what benefit statements like this have. All statistics show that 2008 was a down year, but not the worst year. The agent whose listing appeared in the article was less than pleased. The house was only on the market for 30 days and she has had good buyer interest, the listing is definitely not representative of a down housing market.

We are attempting to counter this negative article. An agent in town wrote a letter to the editor giving some local statistics that show the market is down but not in crisis. I interviewed with the reporter this week and provided her statistics from our MLS that show property values actually increased in 2008 over 2007. The number of properties sold is down about 35%, but values are holding. My opinion is that this is a great market for buyers. Inventories are up giving the buyer some great selections, values are holding giving the buyer security that their investment will be a good one and mortgage rates are really low.

I think that all REALTOR's need to be very careful of what they say to the press. These articles have an effect on buyer and seller decisions. If we are going to give opinions about the housing market make sure that the statistics support the opinion.

I find it difficult to find good information in the news media about my real estate market. The daily news is full of stories about National Housing Trends, Banking Issues and National Real Estate Trends but it just doesn't help me understand what is happening in my local Wisconsin Dells market. This misinformation is confusing local home owners and local buyers and when confused most people tend to sit still.

The problem is that I believe in Real Estate and to me the current market is offering opportunities that we may not see again in our lifetime. As a buyer, mortgage money is cheap and there is a great selection of properties to purchase. As a home owner, this may be the best time to move up to that dream home. But it is tough to feel comfortable to make a move in the market with all of the negative reports in the daily media.

As a REALTOR I have an obligation to my clients and customers to keep them informed of what is happening in the market. During my discussions I try to explain to them that it is the local market that matters. I try to monitor the pulse of the local mortgage rates and lending requirements. I find that community lenders are frustrated by the national stories because they have money to lend and not enough customers to lend it to. I track property sales by neighborhood and have found that in some areas property values have actually increased. I have also found that some properties are selling better than others. I think it is very important in today's market to prepare a full Comparative Market Analysis when evaluating a property; the market is just too complicated to take a casual approach.