Jan DeGiorgio - Mountain Home Idaho Real Estate

The clock starts running on a new home when the Mountain Home, Idaho Building Department signs the building permit. Advances in building science and changing economic conditions work together to cause our homes to rapidly become something less than "state of the art" and worth less than the "next new thing". This is true of every home in the community, but 30+ year old homes need special attention to ensure that value lost by obsolescence doesn't negate value gained through other factors.

It's important to recognize that older homes, in particular, are competing not only with other homes for sale but also with the options of renting in town or living on base.

In Part I of this post we'll look at the "bigger ticket" items to consider and budget for.

My Three Recommended (Major) Upgrades to the Older Home

• The Clear Winner - Energy costs aren't going anywhere but up and installing double pane windows is often a cost effective and visually appealing upgrade. Buyers using VA financing can usually include the cost of new windows and other energy efficiency items in their loans but there's a trick to buying windows so contact me first.
  
  
• Leave the Gravel in the Road - Gravel roofs are messy, trouble prone and singularly unattractive. If you currently own a home with this roofing system and it's time for significant repairs, spending the extra money for shingles may be a smart choice. The current cost of replacing a gravel roof with shingles is about $3.50-4.00 a square foot but shingles require less maintenance and have far greater appeal to buyers.
  
  
• Don't Be Short Circuited - Fused, 60 amp electrical systems are antiquated, possibly dangerous and usually uninsurable - fused, 100 amps systems are only slightly better. Even the smallest of homes should include minimum 125-150 amp service with circuit breakers. Although not as costly as new windows or roofing, upgrading the service may require other code updates so be sure to talk to an electrician first.

Buyers Beware - If you're buying a home with seriously obsolete components (e.g. single pane windows) BE SURE that this is reflected in what you offer. Ask to see sales information about homes with and without the upgraded items. But then again, that's what a good real agent is for.

Jan DeGiorgio - Associate Broker
Century 21 Southern Idaho Realty
Mountain Home, ID
www.mtnhomejan.com

Activity and Prices By historical standards, 2007 was a good but not record setting year for Mountain Home. Sales of both new and existing homes were off about 19% from 2006. During the same period, the median price of existing homes increased by 12% to $152,000 while new homes saw a price drop of about 5% to $192,000. Much of the decrease in new home prices is because fewer, more expensive homes on acreages were built in 2007.

Marketing Time The average marketing time (from date of listing to date of closing) is currently 59 days, an increase of 7 days for the year. However, a recent spike in the average number of days current (unsold) listings have been on the market suggests that the 59 day figure will increase significantly in the near future.

2008 Forecast Although activity has recently (and noticeably) slowed, Mountain Home continues to escape the carnage that other areas of the country are experiencing. One of several factors in Mountain Home's favor is that relatively few sub-prime loans were made so a market flooded with foreclosure properties (and the potential for a "value death spiral") seems very unlikely.

In summary, based on what I'm seeing now, it's unlikely that 2008 will look much different than 2007 - Buyers will maintain the upper hand and Sellers will need to forget the double digit appreciation rates of the past few years and price their homes according to current market conditions.

A Small Side of Facts To Go With the Steady Diet of Media Misinformation Although I feel that "shooting the messenger" might be a bit much, I sure would like to kick him in the shins. As a tonic to the daily dose of hysteria and hype we're being fed every day, I'm including a couple of facts from the Office of Federal Housing Enterprise Oversight that I think will be enlightening.

1. The annualized, national price decline is currently 1.5% - a far cry from the numbers you've probably seen.
2. Price changes, up or down, are based entirely on local market conditions. Over the past four quarters, homes in Merced, CA have lost 13% of their value while those in Idaho Falls, ID have risen by nearly 12% with a 9% increase in the Mountain Home area. Opportunities

Contact Me to learn about the best values available in the Mountain Home, Idaho real estate market and for general market updates.