Scott Haigh

Sales of Cleveland Heights have risen in the last three month compared with the previous three months. Of those single family homes that sold in the last three months, all of them were $55,000 or less, so this may reflect bank-owned homes, foreclosure, distressed properties, or homes whose owners just had to lower the price to get them sold. In any case 131 homes were sold or pending in the last 90 days compared to 121 sold or pending for the previous three months. The down side of this is that there were 410 homes for sale during the last 90 days and only 89 for sale the previous 90 days. This may reflect people taking homes off the market for the Christmas holiday. So, more homes were sold but more came on the market the last three months, so the absorption rate has dropped for single family homes, from 45% to 11%. The same goes for condomiums. We had more sales in the last three months- 9 units compared to 3 the previous 3 months, but there were 67 for sale the last 90 days compared to 12 the previous three months. Thus the absorption rate dropped from 8% to 4%

The figures:

Last 90 days:

Single Family Homes

410 for sale
131 sold or pending (43.67/month)
Monthly Absorption Rate = 11%

Condominiums

67 for sale
9 sold or pending (3/month)
Monthly Absorption Rate = 4%

Previous 90 days (previous 4-6 months)

89 for sale
121 sold or pending (40.33/month)
Monthly Absorption Rate = 45%

Condominiums

12 for sale
3 sold or pending (1/month)
Monthly Absorption Rate = 8%

It seems that the net effect is that we did not really increase the rate at which homes are selling, so we're not out of the woods yet, but we are gradually working through the inventory. Let's see what the spring market of 2009 brings us!

A recent story on Cleveland.com talks about the 4% decline in the median price of homes in Cuyahoga county. It prompts this thought about the market "bottom".

Buyers need to make a decent offer so as not to alienate the seller. Trying to time the market and waiting for the "bottom" doesn't work because when buyers are sure the market has bottomed, prices have already risen and they miss their chance at buying at the "bottom". Prices are substantially reduced already and buyers can rest assured that they are getting a good discount on most homes! Let's see what happens with the proposed $15,000 tax credit. Hopefully that will flush out more buyers...

Here is my end of year real estate report for the Heights. These are the latest statistics extracted from the Northern Ohio Multiple Listing Service:

These figures represent the MONTHLY average of sold homes in the last three months...

Cleveland Heights- total for sale at present- 433

Solds/month Absorption Rate/month

$0-$99,999
26 5.9%

$100,000-$199,999
10 2.2%

$200,000-$299,000
2 .4%

$300,000-$399,999
2 .4%

$400,000+
.33 (1 in 3 months) .1%

University Heights- total for sale at present- 125

$0-$99,999
8 6%

$100,000-$199,999
3 2%

$200,000-$299,999
.33 0.3%

$300,000-$399,999
0 0%

$400,000+
0 0%

Shaker Heights- for sale at present- 286

$0-$99,999
10 3.5%

$100,000-$199,999
7 2.6%

$200,000-$299,999
4 1.5%

$300,000-$399,999
2 0.7%

$400,000-$499,999
1 0.3%

$500,000+
1 0.5%

Clearly homes below $100,000 are selling the quickest with homes ranging in the $100,000-$200,000 following behind.

Price trends- comparing the last three months with the July-August-September period

Cleveland Heights- down 2%
University Heights- down 42% (ouch...)
Shaker Heights- down 23%

Obviously Cleveland Heights is holding up better or perhaps its biggest price drops occured earlier. That would require more research.

If you are a buyer, this is a great time to purchase a house. Prices have come way down and mortgage rates are as low as they ever have been. As you can see, there are 844 homes for sale in the Heights so there is a wide selection of properties to choose from!

If you are selling, contact a realtor regarding advice on how to prepare your home to put it in it's best light, thereby increasing your chance of selling it in this incredibly competitive market. Don't forget- EVEN IN THIS MARKET PEOPLE NEED TO SELL AND BUY HOMES!

Due to low mortgage rates, it's a great time to refinance your present mortgage if you have one. Whether is purchasing or refinancng, contact your realtor for more information!

Let's look forward to better days ahead with a positive attitude and I wish you a very Happy New Year!!

Scott

Here is a summary of the absorption rates of homes for sale in Cleveland Heights for June, July, and August (up to August 24) These figures are based on data from the local MLS

JUNE

Less than $100,000- 53%

$100,000-200,000- 20%

$200,000-$300,000- 14%

$300,000+ 23%

JULY

Less than $100,000- 55%

$100,000-200,000- 14%

$200,000-$300,000- 11%

$300,000+ 18%

AUGUST

Less than $100,000- 52%

$100,000-200,000- 8%

$200,000-$300,000- 13%

$300,000+ 8%

Conclusion: the fastest selling homes are those under $100,000. June was the strongest month for sales, as expected, and then July and August saw a significant drop in the absorbtion rate for homes over $100,000, while homes under $100,000 continued to experience good sales into August. Sold price per sq. ft. declined significantly over the three summer months except in the $300,000+ category, meaning the more expensives home seem to holding their value.

Days on Market

This changed very little over the three months and average as follows:

Under $100,000 - 89 days

$100,000-$200,000- 102 days

$200,000-$300,000- 116 days

$300,000+ 149 days

Scott Haigh, Realty One

There is interesting news about the real estate market in Cleveland. According to data from NORMLS (Northern Ohio Regional Listing Service), sales in Cuyahoga county from April '07 to April '08 are actually up 5.1% and the number of new listings declined 8.8% for the same period, indicating that progress had been made in working through the housing inventory The down side is that the average price has declined 14.8%. If you are looking for a home for the long term, this is an excellent time, with great prices and low interest rates.

Although the Cleveland has been one of the centers of the real estate meltdown, local government is beginning to tackle the problem. Recently the City of Cleveland went after some of the abusive lenders in court- one of the first cities to do so. In addition, Cuyahoga County prosecutor Bill Mason obtained convictions against three people involved with mortgage fraud. Read about it here:

http://blog.cleveland.com/plaindealer/2008/06/trio_convicted_in_mortgage_fra.html

The recent bad news about Continental Airlines cutting back direct flights from Cleveland and therefore putting their plans to add 700 jobs in Cleveland on hold has been balanced by the news that the Defense Finance and Accounting Service is adding 600 jobs to the Cleveland area. The DFAS does accounting work for the U.S. Navy and Marine Corps. That could potentially pump 4.8 million dollars into the downtown economy. Read about it here

http://blog.cleveland.com/business/2008/06/dfas_adds_600_jobs_to_clevelan.html

Cleveland has had bad spells through it's history but it has a fighting spirit and it is taking good steps towards making progress against the real estate problem.
It is still one of the most livable cities in America and I love it here! Take advantage of this week's great weather and look at some homes!

Visit my sites: www.realtyone.com/scott.haigh and www.scotthaigh.com