Lynda Bennett

Market Analysis: Are you Behind the Curve?

As we have been hearing on the news; prices are falling in real estate. Appraisals are coming in lower. The market is different than it has ever been before. What does that really mean? It is shocking. It means that the value/price/sales price/list price of a house or property for sale is actually going down each month it is for sale.

This means that if you have real estate for sale and the price is too high; then you are behind the curve and losing ground daily. Every month (or year) that goes by - the gap between ‘what the properties are going to sell for' and the ‘list price' gets wider; creating a scenario in which it is increasingly difficult to get an offer.

The obvious solution is to drastically reduce the price to create an environment where an offer may come in. The list price needs to be within 6% of the realistic sales price. As time moves along the spread between the list price and the sales price widens. That creates the need for a substantial price reduction.

This is not the experience that we have seen in past years. In the past, prices went up over time. That made things easier. If you wanted more for your house - all you had to do was wait and the prices would rise; eventually reaching the asking price. These were the ‘good old days'.

Waiting will only make this problem worse - since we are not waiting for prices to go up; but rather for them to go down.

If you want to sell your property, it is important that this concept be fully understood. Rather than waiting until a low offer comes in, and trying to explain all of this in the moment; it seems like a good idea to discuss it in advance.

This information is not what any one wants to hear. If you are one of the people that needs to sell or that must sell - then this information is essential.

If you are one of the sellers that do not have to sell or you are attached to the price; then this is not what you want to hear, but it may not affect your decision.

These two scenarios are creating essentially two markets - one that is competitively priced and the other market that is not. The discrepancy between the two markets is becoming more evident.

We are having sales - over 1000 homes sold in Haywood County, North Carolina last year. Only the houses that are competitively priced are selling.

The real estate agent is responsible for marketing the property, but the buyers will decide which ones are competitively priced and which one to make an offer on. The seller is responsible for creating an environment that encourages offers.

It is my belief that if you want to sell, then it can done.

The buyers are very conservative right now and they will not over pay. They are shopping around and know what is on the market - now - not last year. There are many choices for them.

They are real buyers and they will buy. Now is a great time to buy. Low interest rates, great prices and a large inventory create a perfect market for buyers. And the activity is apparent for the competitive properties. Offers are being made and properties are selling.

It is too soon for the Stimulus Package to be working. There for - what could it be?

Business is picking up. More buyers are looking, more offers, more activity.

Is it just me or is it happening in other areas as well?

I do not think it is any new strategy on my part - I have been hanging in there. It is our 'slow time of year'. So, is it just a feeling or is it a trend?

I tried pulling statistics; but what should I compare it to - the good years of 2007, 2006, or what?

0 % Financing is a new concept we are trying in the Katua Community in Maggie Valley, NC. It is a resort sales area so we are attempting to grab the interest of people that do not 'need to buy' but may want to get a good investment with great terms and while prices are very competitive.

Has anyone tried 0% financing to promote properties? The CPA said the tax consequences include that the amount of a 'normal interest rate' would be deducted from the sales price and categorized as interest earned on the tax return. That is not too big of a negetive.

Any other ideas, suggestions & comments on how this might be marketed or any pit falls in your experience.

See Katua www.MountainHeritage.com

The USDA loans are available for the time being. These low interest rate, low down payment loans are a source of funding for my 'rural' area.

This loan source is allowing some people to enter the market that might not otherwise have a loan source. Derrick Prickett of Action Mortgage has been a great help in geting approvals for these loans. Below is a house that just got an offer with a USDA loan.

http://www.wncrmls.com/wnc/maildoc/a004v33456.html

In these interesting times, we find opportunities to buy quality properties for less.

This may be one of those opportunities. This new home is on the market as a pre-foreclosure property. It does not have a CO yet. The home has never been lived in and it is in one of the premier neighborhoods in Waynesville, NC.

So if this is of interest to you please let me know. Be sure to notice the gorgeous VIEWS, the large windows in the great room with a 2-story fireplace, and big bedrooms. The full basement is unfinished at this time. The two car garages are on the main level, which makes for easy access.

Give a call or an email for additional info or a showing!