Real Estate Information Archive

Since the topic of conversation with Franklin, MA and Boston area agents has recently centered on the lack of available housing inventory for prospective buyers, I decided to take an informal survey of the situation.

I individually asked ten Franklin Realtors how many buyers they had who would likely purchase a home priced between $250,000 and $450,000 on or before April 30^th, 2010.  I chose April 30^th since move-up or first time buyers looking to take advantage of the homebuyer tax credit must have a signed contract on a home by this date.  The agents did not know any explanation other than I was gathering information for a future blog post.  The data I collected cannot be viewed as statistically significant but rather just a small snapshot of the current Franklin, MA market conditions.

The respondents indicated the following:

• Six agents expect five buyers will buy
• One agent expects three buyers
• One agent expects eight buyers
• Two agents expects four buyers

This was very interesting to consider that potentially a total of 20 buyers –connected to ten different Realtors-- are expected to purchase a home during the next three months.  The harsh reality is that currently there are only 57 homes for sale in the entire town in every price range.  This group was only a fraction of the buyer agents who will likely have prospective buyers for Franklin homes over the next three months.  Most every full-time agent has distinct memories of the endless bidding wars during 2009 in which some buyers were not able to find a home as they attempted to meet the (then) November 30^th, 2009 deadline.

Buyers need homes to purchase now.   Sellers, despite it still being a buyer’s market, can rest assured that the low inventory of homes means a likely higher selling price for their home.  The time it takes to sell a home may also be reduced as buyers feel the pressure to find the best home as soon as they can. Homes do need to properly appraise with the bank agreeing with the selling price but valuations may begin to rise.

It really is a good time to sell or buy a home! 

Please give me a call or email if you need more data or have questions about this information…

Jerry Howard, president and chief executive officer for the National Association of Home Builders, just released his views on the current state of the economy and interestiingly it echoes much of what the Franklin, Massachusetts area Realtors have found.  (Howard has spent 25 years in the housing industry as lobbyist, real estate lawyer and tax counsel.)

Howard believes that first-time homebuyers show that housing is worth pursuing and that the tax credit plan so far can be viewed as a successful experiment that the government should seriously consider extending into 2010.  In the metrowest of Boston area, this has been one of the busiest summers any local Realtor can recall as first time buyers have flocked to find their perfect starter home.  The promise of tax credit money seems to have been the impetus for this flurry of activity during an otherwise quiet time of the year. 

Howard states this historically this is one of the best times to buy a home but qualifies it this way: "a prospective home buyer who is currently employed and your own financial conditions are stable, this is the best possible time to buy. Inventories are at a point where you'll be in a better position to negotiate with the seller. Sellers are in a position where they really want to unload their inventory, and interest rates are still at almost record lows. So if you're in a position, personally, to buy and of the mind-set to buy, this is absolutely the time."

If you need help as you are getting ready to buy a home, give me a call or email me with your questions at 508-369-5131 or franklinmahomes@comcast.net.

Here is a brief but helpful Youtube video on preparing your home for sale. 

http://www.youtube.com/watch?v=uGgTSTRkROg

A review of the latest data shows that the Franklin, Massachusetts real estate market is holding its own and actually fared quite well this summer so far.  The data from May 2009 until the present shows the following:

• there are 124 single family homes for sale total
• prices have changed by 5% from initial asking price
• 36 homes are pending, waiting to close
• the average list price is $459,057 with an origiinal price of $470,781
• the average sale price is $445,147
• 102 days is the average days on market until closing

If you have questions about your home, the buying or selling process or this data, please feel free to call or email me at 508-369-5131 or franklinmahomes@comcast.net.

Lately I have been a buyer's agent for a number of buyers and what I have found is that contrary to some reports real estate is extremely hot in the under $350,000 range.  My frame of reference most recently is the metrowest of Boston area towns, especially Franklin, Wrentham, Plainville, North Attleboro, and Mansfield.  Every listing is getting MANY showings on a daily basis and multiple offers usually within the first week. 

Some agents advise their sellers that gathering all offers for one week then discussing them at the end of the week is a strategy to obtain as many offers as possible.  This can be helpful as long as some buyers don't get anxious thinking that they will have to overbid by a large amount.  Overbidding is not necessarily acceptable now either since the house must appraise by the bank and too high a selling price could be rejected by the bank.

It is very interesting to see this urgent buying scenario where 6 months ago this was not the case.  Maybe the homebuyer tax credit money is prompting buyers to buy now to claim their possible $8000 refund?

Please call or email me if you have questions about the buying process at 508-369-5131 or franklinmahomes@comcast.net.

The  tax deductions you’re eligible to take for mortgage interest and property taxes greatly increase the financial benefits of homeownership. Here’s how it works:

Assume:

$9,877 = Mortgage interest paid (a loan of $150,000 for 30 years, at 7 percent, using year-five interest)
$2,700 = Property taxes (at 1.5 percent on $180,000 assessed value)
______

$12,577 = Total deduction

Then, multiply your total deduction by your tax rate.

For example, at a 28 percent tax rate: 12,577 x 0.28 = $3,521.56

$3,521.56 = Amount you have lowered your federal income tax (at 28 percent tax rate)

Note: Mortgage interest may not be deductible on loans over $1.1 million. In addition, deductions are decreased when total income reaches a certain level.

As we start to see signs of stability in the national and especially regional, Franklin, MA housing market, I decided to conduct my own unscientific poll regarding levels of optimism about home valuation. I learned that locally most consumers believe home sales will return to record highs but no one can seem to agree when they think this is likely.  Most feel that within 5-8 years the Northeast will be back to record high home sales. The results were split evenly between those predicting record sales in 10-12 years and those in the 8-10 year group.

A recent poll by Housing Predictor asked consumers if they believed home prices would one day hit the record highs last seen during the residential property boom. Of those surveyed, 62 percent anticipate a recovery and expect record high prices to be achieved down the road.

Consumers appear to have faith in housing, despite troubling media reports triggered by the foreclosure crisis.

In today's real estate market which still favors buyers more than sellers, it is inevitable that a seller will receive an offer on their home that is lower than they would like.  It is important, however, for a seller to try to become detached from their home and pay attention to this buyer rather than dismiss them entirely since this could be the beginning of a dialogue and ultimate sale.

Buyers should be doing their homework in researching some homes as best as they can, then driving by the shortened list of properties.  A buyer agent can assist in educating the buyer about the neighborhoods, home values and type of market conditions.  For example, if the market is trending downward, it may be possible that a seller who does not adjust their asking price at all will ultimately agree to a much lower offer.  The offering amount should be based on something concrete such as recent sales of homes with similar age, condition and size.  It is unwise for a buyer to base an offer solely on what they want to pay.  In other words, the buyer who offers $100,000 below the asking price on Day 1 on the market is certain to lose out. 

Ian Maker, with RE/MAX Gold in Rancho Cordova, California sums it up this way in an interview with Bankrate.com. "If the seller wants to sell the property, every offer deserves a counteroffer, and if the buyer wants to purchase the property, every counteroffer merits consideration. The objective is to keep the lines of communication open until a deal is agreed upon." 

The old adage holds true, "You just never know..."

Although some would not believe it the numbers speak for themselves.  The March-June 2009 Franklin spring market has rebounded in a big way.

• Single family homes in Franklin are taking an average of 69 days to go under contract
• The average sales price is $421,529 which is up 2% from last year's spring average of $410,598
• Single family homes are selling within 3% of their list price

If you need more information regarding the local market, give me a call at 508-369-5131.

All data is from the Multiple Listing Service Property Information Network or MLS PIN.

So we all know by now that the Franklin, Massachusetts real estate market is doing relatively well with many homes for sale and many buyers out looking.  What is not realized, however, is that these buyers are extremely demanding and fussy making it especially trying for a seller these days.

Mark Zandi, chief economist at Moody's Economy.com. says "I don't think [home] sales will really pick up until the job market has stabilized—and that won't be this spring." He goes on to recommend that since buyers have the upper hand, sellers need to be extra diligent and creative in getting the house ready to sell as well as being open minded to feedback.  As a local Franklin, MA area REALTOR I know that I can show my sellers the statistics regarding other homes that are going under agreement while theirs is not, but nothing hits home like a seller going to the competition's open house to really see what is going on.

Do not dismiss offers but instead try to work with everyone.  He also recommends that negotiations cannot be taken personally as difficult as that may be.  The home is now a product for sale and it is a business decision for a buyer to make an offer based on what they think the home is worth.  It is the wise seller who realizes that any offer could become a good one even if it does not appear that way at first. 

It does take extra patience, creativity and diligence to get a home sold now but homes are selling in a relatively reasonable timeframe so in the end it seems worth it to achieve one's goals.

Please call or email me if you have questions about selling your home at 508-369-5131 or franklinmahomes@comcast.net.