Ron Wickes

In the past two weeks we have been flooded with news about mortgages, home ownership, the four keys to our housing market recovery, more foreclosures to come and a ton of other housing related news. Let's take a moment to review some of this news.

Ben Bernanke, Chairman of the Federal Reserve System said that new rules are coming for lenders. These new rules will prevent "shady" mortgages and provide better protection for the borrower and ultimately result in fewer home loans being made. Henry Paulson, Jr., Secretary of the Treasury said that there is no way to prevent a lot of foreclosures from happening because the borrowers involved should never have been given mortgages in the first place. Congress is close to passing the mortgage rescue bill and the Joint Center for Housing Studies at Harvard University said we were in the worst housing market in 50 years. Credit card companies are reducing credit limits thus lowering credit scores and making fewer people eligible for mortgages. Combine these tidbits with what has been called the "new affordability" for large tract home builders and we are faced with a large amount of information to digest. When I first read all of this material I was left with a severe case of "housing" indigestion. My medicine cabinet held no relief for this type of sickness. The same type sickness that affects our real estate market today.

So what does all this mean? I believe it means that there is a new real estate dynamic evolving; a new housing dynamic that is already here, but not realized nor understood by most of us. A new housing dynamic that will affect current and future homes buyers and sellers, mortgage brokers and bankers, real estate agents, credit restoration/improvement specialists, home builders, real estate investors and just about everyone else involved in the real estate transaction chain.

What I am going to attempt to do over my next few blogs is examine this possible new dynamic and explore the possible affects it will have on all of us. I will title "New Housing Dynamic - Pt ?" with the question mark representing the number of the blog in the series. I firmly believe that the new housing dynamic has arrived. It is time that all of us, from agents, to buyers to sellers, wake up to this fact, address it, and adjust to it. It will have a profound affect on all of us now only now but in the future also.

I look forward to hearing from all of you on this matter.

Have a great day!

Ron

How were the April, 2008 sales results for single family residence (SFR) unit sales as compared to April, 2007? Down again but not as bad. Let's take a look.
In MLS area 15 (Woodlands & West) sales were down 17%. In MLS area 19 (Conroe) they were down 9.68%. MLS area 39 (Lake Conroe area) was down 15.91% and MLS area 40 (East Montgomery County) was UP, yes UP 45.45%. Overall county single family residence unit sales declined 12.27% from April, 2007. This 12.27% decline was less than the previous three months of 2008. This lessening in the sales decline may be an indicator that the bottom is near. What a relief that would be for all of us.
The average "Days on the Market" required to sell a home increased in all four county MLS areas. These numbers increased from a low of 14.71% to a high of 22.83%. If you need to sell please remember to price correctly and list your home early.
The number of active listings increased only slightly moving up 1.29%. This small increase combined with the lessening sales decline may, as mentioned earlier, be an indicator that the bottom is near or has been reached. MLS areas 19 and 39 showed decreases in the number of active listings.
When we look at all of the sales numbers objectively, the Texas economic forecast and what the local county appraisers are doing as far as raising tax appraisals on businesses I do believe that something is shaking the trees so to speak. What is doing the shaking? I hope and honestly do believe that it is the pent-up demand for housing. As I mentioned twice earlier I believe the pendulum is about to start swinging the other way if it hasn't already. Is there further evidence of this? Yes I believe there is and I think it is in the area of average sales prices. We will address this subject on Monday along with the year-to-date SFR unit sales numbers.
Have a great weekend!
Ron

Yes it is true, sales in Montgomery County, Texas fell this April versus last April but prices rose in three of the four MLS areas that comprise the county. In MLS area 15 (The Woodlands & west) prices rose 14.12%, in MLS area 39 (Lake Conroe) they rose 2.98%, in MLS area 40 (East county) they rose 13.87% and lastly in MLS area 19 (Conroe) they fell 12.9%. Those numbers are 2008 versus 2007. Amazing that sales fall and the sales prices continue to rise. The "deal" that some of you were hoping for is probably not going to materialize. The number of active listings is also starting to stabilize. County wide there was only a 1.29% increase over the number of active listings at the end of last April.
The average "Days on the Market" did take a big hit versus last April. The increases in this area for the four MLS areas ranged from a low increase of 14.7% to a high increase of 22.8%. Okay so your house takes longer to sell but there is a good chance you may get more money for it. Plan better and plan early is probably the key there.
In looking at the actual sales numbers they did fall again. The amount of decrease is smaller though and I think shows that the bottom is near. I will give you the actual numbers later this week. Don't be surprised if the deal you thought was there vanishes overnight. Last week a client of mine finally decided to make an offer on a home she had been looking at for three months. Well guess what, that same day the buyer got two other offers and my client's was not the high one. Please if you are thinking of making an offer make it today. Time waits for no person.
I hope you all had a great Memorial Weekend.
Ron

Do you have thoughts about selling your home and buying another one or possibly moving out of your apartment into a home? Is the lack of information about your subdivision or the subdivision you would like to move into keeping you from making the decision? Well look no further. Information on most individual subdivisions in Montgomery County is available. All you have to do is ask me and you will have it. I can tell you the price range, number of sales, price per square foot, average annual change etc. for most of the subdivisions in our county.
So please send me an email and get what you need. And yes I would love to list your home for sale and/or help you buy a new one.
Thanks and have a great day.
Ron

Prior to the release of the April sales numbers I thought it might be interesting to take a look at more of the numbers and see if people are still moving and to try and see if the market really has dropped or because of the credit crunch has the market just shifted a little. Here is what I found in looking at the first quarter of 2008 vs the same period 2007. These numbers are for Montgomery County.
Total unit sales of single family residences and townhomes/condos for the first three months of 2008 vs 2007 were down 18.5%. Big number right? Not so fast. Single family residence and townhomes/condo rentals for the same period were up 8.5% At this point we are left with a year-to-year decline of about 10%. But, and I do not have access to these numbers, rumor has it that apartment rentals are up at least that much if not more. And let's remember that the foreclosure rate in Texas is up only about 11% from the previous year and not 65% as advertised so blatantly on CNN today.
Conclusion? That the demand for housing in some form is still present. Is home ownership a problem for those with less than stellar credit? Yes. Can this problem be fixed? In many cases yes. More on that at a later date. Is real estate still a good year to year investment? Yes especially if you are an investor and thinking of purchasing homes for rental income.
Once again I have to tell you please do not believe all that you read in the national media. Montgomery County, Texas is still a great market. It is still a vibrant market with a ton of opportunities available. It is a good time to sell and buy.
See you later.
Ron