Independence, OH

September 2010 Independence Ohio Real Estate Market Conditions Report for the Independence, Ohio community in Northeast Ohio.

Absorption Rates and Months Housing Supply

These two terms are one piece of the puzzle to help real estate agents, appraisers, home sellers and buyers alike make sense out of the real estate market.

This is a little-known, but effective tool, if used in proper context, to help a home seller or buyer understand the market conditions for the home they wish to sell or buy.

The easiest way to define these two terms is with an example:

Absorption Rates (AR)- The rate at which homes are selling (ie. absorbed), over a specific time period, typically 12 months. This is beneficial in determining supply and demand trends for the local market.

Months Housing Supply (MHS) - How long it will take, in number of months, for all the current homes for sale to be sold.

Formulas:

Monthly Absorption Rate = # of homes sold in the past twelve months / 12 Months.

Months Housing Supply = # of currently active homes for sale / Monthly Absorption Rate

Reference Guideline:

# Months to Sell Type of Market

1-4 Sellers

5-6 Balanced

7+ Buyers

Note: Six (6) months of inventory is considered a balanced market.

As is true with everything statistical, one has to really know when to apply this tool, under what circumstances is it relevant, and what are the constraints, as with everything in real estate, no individual property fits neatly into a box (no pun intended) or equation.

Here are a few examples of a few constraints:

• Seasonal fluctuations - If more homes sell in the spring and summer months, what should the sampling period be?
• Expired Listings - How should listings that have expired and been re-listed be treated?
• Selecting Active and Sold Homes - What homes should be selected? What criteria should be used?
• Selecting the AR Time Period - Is 3 months enough? 6? 12?
• Is there a negative or positive trend underway? How do you compensate for the trend?
• Since these are median #s, how does my home relate?
• What can I do to make my home defy the median?
• Do watershed events (say...the October 2008 Economic/Credit/Housing meltdown) affect: time periods? the statistics themselves, the subset of homes selected, etc.? The expirations of the 2010 federal tax credit incentives are also another watershed event that will keep the real estate market in a period of uncertainty.
• The local and national economy.
• Is new construction affecting the supply or demand of nearby properties?

A question that sellers typically raise after reviewing this information:

Does this mean my home will take 7-8 months (Median MHS) to sell? While there is no easy answer here, the answer is: It depends. Many factors go into how quickly or long a home will sell. See my post titled "Your home is worth whatever a buyer is willing to pay for it" which talks about the many factors to consider when selling a home. We sell homes that defy the median, and are at the low end of the statistics when sellers listen to our advice and adopt our home preparation, staging and pricing considerations. While nothing is guaranteed, it's all about maximizing your opportunities relative to your competition and constraints.

Using a concrete example below, taken from the Northeast Ohio MLS, this report was run for the City of Independence, Ohio, all single-family homes, so to see what is happening in the community as a whole:

Source: NEOHREX. Information deemed reliable but is not guaranteed.

A couple of observations from looking at the above table:

• The MHS has improved greatly since the last May 2010 Independence Ohio Real Estate Market Conditions Report. The MLS is starting to near a balanced market and is down significantly from 11-25 months reported in the last report.
  
• While the MLS is very encouraging, it remains to be seen what will happen to the inventory now that the federal tax incentives have expired. We will be watching closely to see if the inventory begins to increase.

Note: This is an example at a community level. The selection criteria would be customized to be relevant for a given property so as to make the data more meaningful.

Note: As of 4/1/09, Fannie Mae is requiring appraisers to compile the information you see above to be used as a part of a Market Conditions Addendum for appraisals.

Olsen Ziegler Realty -- A $marter Way to buy and sell your Independence, Ohio Home

May 2010 real estate market statistics and Market Conditions Report for the Independence, Ohio community in Northeast Ohio

Absorption Rates and Months Housing Supply

These two terms are one piece of the puzzle to help real estate agents, appraisers, home sellers and buyers alike make sense out of the real estate market.

This is a little-known, but effective tool, if used in proper context, to help a home seller or buyer understand the market conditions for the home they wish to sell or buy.

The easiest way to define these two terms is with an example:

Absorption Rates (AR)- The rate at which homes are selling (ie. absorbed), over a specific time period, typically 12 months. This is beneficial in determining supply and demand trends for the local market.

Months Housing Supply (MHS) - How long it will take, in number of months, for all the current homes for sale to be sold.

Formulas:

Monthly Absorption Rate = # of homes sold in the past twelve months / 12 Months.

Months Housing Supply = # of currently active homes for sale / Monthly Absorption Rate

Reference Guideline:

# Months to Sell Type of Market

1-4 Sellers

5-6 Balanced

7+ Buyers

Note: Six (6) months of inventory is considered a balanced market.

As is true with everything statistical, one has to really know when to apply this tool, under what circumstances is it relevant, and what are the constraints, as with everything in real estate, no individual property fits neatly into a box (no pun intended) or equation.

Here are a few examples of a few constraints:

• Seasonal fluctuations - If more homes sell in the spring and summer months, what should the sampling period be?
• Expired Listings - How should listings that have expired and been re-listed be treated?
• Selecting Active and Sold Homes - What homes should be selected? What criteria should be used?
• Selecting the AR Time Period - Is 3 months enough? 6? 12?
• Is there a negative or positive trend underway? How do you compensate for the trend?
• Since these are median #s, how does my home relate?
• What can I do to make my home defy the median?
• Do watershed events (say...the October 2008 Economic/Credit/Housing meltdown) affect: time periods? the statistics themselves, the subset of homes selected, etc.?
• Is new construction affecting the supply or demand of nearby properties?

A question that sellers typically raise after reviewing this information:

Does this mean my home will take 11-25 months (Median MHS) to sell? While there is no easy answer here, the answer is: It depends. Many factors go into how quickly or long a home will sell. See my post titled "Your home is worth whatever a buyer is willing to pay for it" which talks about the many factors to consider when selling a home. We sell homes that defy the median, and are at the low end of the statistics when sellers listen to our advice and adopt our home preparation, staging and pricing considerations. While nothing is guaranteed, it's all about maximizing your opportunities relative to your competition and constraints.

Using a concrete example below, taken from the Northeast Ohio MLS, this report was run for the City of Independence, all single-family homes, so to see what is happening in the community as a whole:

Source: NEOHREX. Information deemed reliable but is not guaranteed.

A couple of observations from looking at the above table:

• The MHS is somewhat higher than a balanced market, so the current market (and true as well over the past year) favors buyers.
• Sales are up in the current quarter, which is not entirely surprising as the first federal tax 8K tax credit that expired on 11/30/09 drove sales higher, whereas the extended and expanded tax credit which is set to expire on 4/30/10 has also "moved the market forward" in that buyers are moving up the timeline of their home purchases to take advantage of the 6.5K/8K federal tax credits.
• The May 2010 Independence Ohio real estate market is relatively unchanged from the March 2010 Independence Ohio real estate market report.
• It will be interesting to see if the MHS starts to rise now that the federal tax credit stimulus are no longer in effect.

Note: This is an example at a community level. The selection criteria would be customized to be relevant for a given property so as to make the data more meaningful.

Note: As of 4/1/09, Fannie Mae is requiring appraisers to compile the information you see above to be used as a part of a Market Conditions Addendum for appraisals.

Olsen Ziegler Realty -- A $marter Way to buy and sell your Independence, Ohio Home

Independence Ohio Real Estate Market Report First Quarter 2010

The numbers you see below are fairly typical first quarter results. Some of the closed and contingent sales likely went under contract in December and early January. I have been very busy during the first quarter as is the case with many of the agents in my office. I would expect a good increase in the number of transactions in the second quarter. Although the number of transactions will increase, it remains to be seen whether or not there will be a significant increase in closed sales prices. The yellow areas represent a decrease from 4th quarter, the red an increase. Many buyers and sellers are trying to take advantage of the tax credit, which ends on April 30th 2010.

	INDEPENDENCE
	SINGLE FAMILY
# OF ACTIVE LISTINGS	38
AVG. SQFT.	2793
AVG. PRICE PER SQFT.	$126.54
AVG. MARKET TIME	117
AVG. LIST PRICE	$361,505
AVG. SALE PRICE	N/A
# OF CONTINGENT LISTINGS	3
AVG. SQFT.	1485
PRICE PER SQFT.	$139.18
AVG. MARKET TIME	61
AVG. LIST PRICE	$211,467
AVG. SALE PRICE
# OF PENDING LISTINGS	6
AVG. SQFT.	3128
AVG. PRICE PER SQFT	$106.51
AVG. MARKET TIME	149
AVG. LIST PRICE	$371,863
AVG. SALE PRICE	N/A
# OF CLOSED LISTINGS	15
AVG. SQFT.	2020
AVG. PRICE PER SQFT.	$109.16
AVG. MARKET TIME	90
AVG. LIST PRICE	$234,292
AVG. SALE PRICE	$219,864

Independence Ohio Real Estate Fourth Quarter Market Report 2009

Independence Ohio Real Estate Third Quarter Market Report 2009

Independence Ohio Real Estate Second Quarter Market Report 2009

Independence Ohio Real Estate First Quarter Market Report August 2009

Statistics show that nearly 90% of buyers and sellers start their search on line. So your home needs a strong internet presence. Below is some of my internet marketing through point2homes:

Here are the March 2010 real estate market statistics and Market Conditions Report for the Independence, Ohio community in Northeast Ohio

Absorption Rates and Months Housing Supply

These two terms are one piece of the puzzle to help real estate agents, appraisers, home sellers and buyers alike make sense out of the real estate market.

This is a little-known, but effective tool, if used in proper context, to help a home seller or buyer understand the market conditions for the home they wish to sell or buy.

The easiest way to define these two terms is with an example:

Absorption Rates (AR)- The rate at which homes are selling (ie. absorbed), over a specific time period, typically 12 months. This is beneficial in determining supply and demand trends for the local market.

Months Housing Supply (MHS) - How long it will take, in number of months, for all the current homes for sale to be sold.

Formulas:

Monthly Absorption Rate = # of homes sold in the past twelve months / 12 Months.

Months Housing Supply = # of currently active homes for sale / Monthly Absorption Rate

Reference Guideline:

# Months to Sell Type of Market

1-4 Sellers

5-6 Balanced

7+ Buyers

Note: Six (6) months of inventory is considered a balanced market.

As is true with everything statistical, one has to really know when to apply this tool, under what circumstances is it relevant, and what are the constraints, as with everything in real estate, no individual property fits neatly into a box (no pun intended) or equation.

Here are a few examples of a few constraints:

• Seasonal fluctuations - If more homes sell in the spring and summer months, what should the sampling period be?
• Expired Listings - How should listings that have expired and been re-listed be treated?
• Selecting Active and Sold Homes - What homes should be selected? What criteria should be used?
• Selecting the AR Time Period - Is 3 months enough? 6? 12?
• Is there a negative or positive trend underway? How do you compensate for the trend?
• Since these are median #s, how does my home relate?
• What can I do to make my home defy the median?
• Do watershed events (say...the October 2008 Economic/Credit/Housing meltdown) affect: time periods? the statistics themselves, the subset of homes selected, etc.?
• Is new construction affecting the supply or demand of nearby properties?

A question that sellers typically raise after reviewing this information:

Does this mean my home will take 12-30 months (Median MHS) to sell? While there is no easy answer here, the answer is: It depends. Many factors go into how quickly or long a home will sell. See my post titled "Your home is worth whatever a buyer is willing to pay for it" which talks about the many factors to consider when selling a home. We sell homes that defy the median, and are at the low end of the statistics when sellers listen to our advice and adopt our home preparation, staging and pricing considerations. While nothing is guaranteed, it's all about maximizing your opportunities relative to your competition and constraints.

Using a concrete example below, taken from the Northeast Ohio MLS, this report was run for the City of Independence, all single-family homes, so to see what is happening in the community as a whole:

Source: NEOHREX. Information deemed reliable but is not guaranteed.

A couple of observations from looking at the above table:

• The MHS is somewhat higher than a balanced market, so the current market (and true as well over the past year) favors buyers.
• Sales are up in the current quarter, which is surprising given most communities either have flat or declinig number of sales. That said, with the first time home buyer tax credit that expired on 11/30/09 and extended through 4/30/10, the anticipation for greater sales was expected. The median sales price is up from the prior year, not a bad position to be in considering the current state of the economy, but the # of sales is not large enough to provide statistical validity.
• The MHS in the February 2010 report for the Current - 3 Months was 17.75, so a decrease of almost 5 months is encouraging news.

Note: This is an example at a community level. The selection criteria would be customized to be relevant for a given property so as to make the data more meaningful.

Note: As of 4/1/09, Fannie Mae is requiring appraisers to compile the information you see above to be used as a part of a Market Conditions Addendum for appraisals.

Olsen Ziegler Realty -- A $marter Way to buy and sell your Independence, Ohio Home

Here are the February 2010 real estate market statistics for the Independence, Ohio community in Northeast Ohio

Absorption Rates and Months Housing Supply

These two terms are one piece of the puzzle to help real estate agents, appraisers, home sellers and buyers alike make sense out of the real estate market.

This is a little-known, but effective tool, if used in proper context, to help a home seller or buyer understand the market conditions for the home they wish to sell or buy.

The easiest way to define these two terms is with an example:

Absorption Rates (AR)- The rate at which homes are selling (ie. absorbed), over a specific time period, typically 12 months. This is beneficial in determining supply and demand trends for the local market.

Months Housing Supply (MHS) - How long it will take, in number of months, for all the current homes for sale to be sold.

Formulas:

Monthly Absorption Rate = # of homes sold in the past twelve months / 12 Months.

Months Housing Supply = # of currently active homes for sale / Monthly Absorption Rate

Reference Guideline:

# Months to Sell Type of Market

1-4 Sellers

5-6 Balanced

7+ Buyers

Note: Six (6) months of inventory is considered a balanced market.

As is true with everything statistical, one has to really know when to apply this tool, under what circumstances is it relevant, and what are the constraints, as with everything in real estate, no individual property fits neatly into a box (no pun intended) or equation.

Here are a few examples of a few constraints:

• Seasonal fluctuations - If more homes sell in the spring and summer months, what should the sampling period be?
• Expired Listings - How should listings that have expired and been re-listed be treated?
• Selecting Active and Sold Homes - What homes should be selected? What criteria should be used?
• Selecting the AR Time Period - Is 3 months enough? 6? 12?
• Is there a negative or positive trend underway? How do you compensate for the trend?
• Since these are median #s, how does my home relate?
• What can I do to make my home defy the median?
• Do watershed events (say...the October 2008 Economic/Credit/Housing meltdown) affect: time periods? the statistics themselves, the subset of homes selected, etc.?
• Is new construction affecting the supply or demand of nearby properties?

A question that sellers typically raise after reviewing this information:

Does this mean my home will take 15-41 months (Median MHS) to sell? While there is no easy answer here, the answer is: It depends. Many factors go into how quickly or long a home will sell. See my post titled "Your home is worth whatever a buyer is willing to pay for it" which talks about the many factors to consider when selling a home. We sell homes that defy the median, and are at the low end of the statistics when sellers listen to our advice and adopt our home preparation, staging and pricing considerations. While nothing is guaranteed, it's all about maximizing your opportunities relative to your competition and constraints.

Using a concrete example below, taken from the Northeast Ohio MLS, this report was run for the City of Independence, all single-family homes, so to see what is happening in the community as a whole:

Source: NEOHREX. Information deemed reliable but is not guaranteed.

A couple of observations from looking at the above table:

• The MHS is somewhat higher than a balanced market, so the current market (and true as well over the past year) favors buyers.
• Sales are up in the current quarter, which is surprising given most communities either have flat or declinig number of sales. That said, with the first time home buyer tax credit that expired on 11/30/09 and extended through 4/30/10, the anticipation for greater sales was expected. The median sales price is up from the prior year, not a bad position to be in considering the current state of the economy, but the # of sales is not large enough to provide statistical validity.
  

Note: This is an example at a community level. The selection criteria would be customized to be relevant for a given property so as to make the data more meaningful.

Note: As of 4/1/09, Fannie Mae is requiring appraisers to compile the information you see above to be used as a part of a Market Conditions Addendum for appraisals.

Olsen Ziegler Realty -- A $marter Way to buy and sell your Independence, Ohio Home