The TARR report (Triangle Area Residential Realty report) is one of the area’s leading sources for real estate numbers.  My team subscribes to it every year and we look for the big changes along with the small changes that are happening here in the Greater Raleigh Area.  This month’s report was for a General Brokerage Update for Raleigh, Cary, Research Triangle Park and surrounding areas of North Carolina.

This report compared first quarter 2011 to 2010 when the home buyer tax credit was offered. Here’s some interesting local real estate numbers was offered:

• *CSS – Centralized Showing Service reports home showings: Down 24%
• *2,317 homes for sale changed status to pending: Down 29%
• *Active residential listing inventory down 8%, up 2% from 2010. 
•  *Foreclosure filings:  Down 12%.  Sounds like good news but, it really isn’t.  This is because successfully negotiated shor sales are up.  The “robot signing” foreclosure freeze is over and banks do not need anymore loss on their books to deal with at this point.
• National housing reports showed a 3.7% increase in March over February in 2011 but, 40% of those sales were distressed properties. 
• Greater Raleigh area house selling odds based on the first quarter of 2011 pending sales is 28% compared to 81% in 2006.
• Active residential listing inventory: Down 8% (this is good news for home sellers)
• *New home active listing inventory: Down 21% (this is good news for resale home sellers)
• *Average days on market for closed properties: 122 days, up from 105 days
• *National housing reports showed a 3.7% increase in March over February 2011 but, 40% of those sales were distressed properties.
• *Greater Raleigh area house selling odds based on first quarter 2011 pending sales is 28%. Compared to 81% in 2006.

With the challenging market conditions all Raleigh area home sellers are facing, we at Linda Craft & Team, REALTORS are very grateful and proud to report 65 closings completed first quarter 2011 and 71 pending contracts headed towards closing. That’s a lot of negotiation experience with the new due diligence contract. However, I still like to old contract better just as I liked the 2006 real estate market better. Thank you so very much for your business and referrals.

In a presentation from Bank of America it was stated that they are processing 60,000 short sales a month and 1 out of 7 home owners are presently behind in their mortgage and headed towards foreclosure. Others are requesting loan modifications and forbearances which far exceed the number of short sale requests they receive daily. Most loan modifications are turned down and end up in foreclosure or short sale. The banks are drowning in paper and losses while they struggle to keep their head above water.   

What is Happening With All of  The Banks?

Collectively banks are sitting on 5 million foreclosures that have not re-entered the market for two reasons. One they can’t get to them and two if they released them all at once we would have a total meltdown when home values drop 50% over night. The banks do not want to foreclosure. They lose on average 70% on a foreclosure compared to 40% on a short sale.

How Does This Affect Triangle  Homeowners?

Homeowners in the Raleigh, Cary and Triangle areas are getting more and more distressed with the longer days on market and economical conditions that continue to worsen. The word at the conference is the market is not expected to hit bottom and start improving for 3 to 10 years depending on the state. It can’t improve until the number of distressed properties stop pouring in. To give you an example 4 years ago Bank of America processed 100 short sales per month. 100 then, compared to 60,000 now, is a radical difference.

What Do You Think, Linda?

 I personally believe the Triangle area of North Carolina is are a 3 year state in a price range of $500,000 and below and a 5 year state if the price range is over $500,000. I would love to be wrong and see it rebound today! By the way, the 3 day conference was not all doom and gloom information. It was advanced training on how to save families and neighborhoods from foreclosure. I have attended two of these conferences this year and have a webinar every week with the CDPE organization to stay on top of this quickly changing market.

What Do I Do If I Have More Questions or Need Help?

There are three quick ways to receive information.  First, you can visit my Raleigh Area Short Sale and Foreclosure Resource Website , or visit my Raleigh Real Estate Website’s Short Sale Information Center or you can just simply call me at 919-235-0007.

This past week one of my buyer agents,  JV Lavery, mentioned that prices on large tracks of land had dropped significantly and what a great time it was to buy land and hold it. He is so right but, I don’t know many developers  with $500,000 to a million dollars cash in the bank to buy land in these tight economical times. We all know land has always been a great investment and everyone I know is looking for something to buy cheap and hold onto for high profits later so we started brainstorming who could buy this well priced land.

Here Are Some Ideas On How To Buy Land:

1.   A group of individuals could buy the land to use as a hunt club. For the price of a yearly membership they could own acreage together. Use it to hunt now and hold it for a later sale when the value increases. Now that is a great real estate investment with no risk.

2.  A church could buy land now to hold for a future church plant

3.  A group of individuals could buy land to hold for future development or to sell when the next housing boom hits

4.  A family could buy land and put it into a family trust which would benefit their children

What are some other ideas you may have?  If you are interested in finding out about the best tracts of land for sale in the Greater Raleigh area please contact my team, JV Lavery or myself.  We would love the opportunity to work with you.

Have a great weekend,

Linda

How Will A Raleigh Homeowner Benefit?

The $6,500 tax credit will really help many sellers offset any depreciation they may have experienced in the Raleigh Real Estate market and will give them the extra funds they need to buy a new home. When selling a home you have to deduct the mortgage pay off, property taxes, real estate commissions, revenue stamps and other miscellaneous charges for selling a home. The remainder after everything is paid is the net proceeds. Or better described the check the seller gets at closing to spend on their new house. The Government is giving them an additional $6,500 tax credit to help home sellers in Raleigh buy new homes. This is pretty exciting especially when you consider mortgage interest rates are still around 5% for a 30 years fixed rate mortgage. The low interest rates and the tax credit will help many homeowners get into better houses than they ever dreamed.

Raleigh Mortgage Lending Guidelines Have Changed

Today in order to buy a home most lenders require a minimum of 5% down. We can usually negotiated to get the mortgage closing cost paid by the seller but, when the Raleigh housing market hasn’t appreciated over the past several years it makes it really hard to sell and be able to net enough money from the sale for the down payment on a new home. The $6,500 tax credit will put many home buyers in the market now that could only sit and wait before. Here are some details:

Who is Eligible  

• Existing home owners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (“repeat buyer”), may be eligible for up to a $6,500 tax credit.
• All U.S. citizens who file taxes are eligible to participate in the program.

Income Limits

• Home buyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.
• For married couples filing a joint return, the combined income limit is $225,000.
• Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
• The credit is not available for single taxpayers whose MAGI is greater than $145,000 and married couples with a MAGI that exceeds $245,000.

Effective Dates

• The eligibility period for the tax credit is for homes purchased after Nov. 6, 2010, and before May 1, 2010. However, home purchases subject to a binding sales contract signed by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010.

Types of Homes that Qualify

• All homes with a purchase price of less than $800,000 qualify, including newly-constructed or resale, and single-family detached, townhomes or condominiums, provided that the home will be used as their principal residence. Vacation home and rental property purchases do NOT qualify.  

Tax Credit is Refundable

• A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.
• For example:
  • A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. If you are due to get a $1,000 refund, you would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit).
• All qualified home buyers can take the tax credit on their 2009 or 2010 income tax return.

Payback Provisions

• The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.

The www.federalhousingtaxcredit.com site is being updated and you can find alot of useful information there.

Please remember to talk with your CPA or tax advisor to verify how the tax credit can help you and your family.  I am not a tax advisor but have given you the information above as I understand it.

Hope you stay warm today!

Linda

What is Happening With Luxury Homes Here in Raleigh?

This past meeting I asked everyone what percent they believe real estate values have fallen in the Raleigh, Cary, Apex and Triangle area. We all agreed prices have dropped 15% to 20% in the upper end and at least 10% drop in other price ranges. This is so much better than other areas of our country but, still very painful to folks who need to sell now. 28% of American home owners are under water and that number is expected to be in the 45% by the end of 2010.

If you know of anyone who needs to sell and finds themselves in this negative situation have them call me or visit my web site to learn about some of the solutions available. Several years ago we all believed Raleigh homeowners would be mostly bullet proof when it came to declining real estate values.   Now we know different. Ouch it really hurts!

For more properties in the Greater Raleigh Area feel free to check out my raleigh real estate website where you can create your own search.

A Few Quick Moving Tips For Raleigh Area Families: 

1.   Your children’s rooms should be one of the first places you unpack and set up.  Once it is done they can play in their room and get settled in while you move on to the next important space. 

2.  If your children are used to certain bedtime or morning routines, stick with them.  I know that it is hard when you are in the middle of boxes to do it, but it will make a difference.

3.  Set up your children’s rooms the same way they had it in their old home.  You can always change it later, but having everything in the same spot makes it easier for them to know where things go.  

4.  Get out and meet the neighbors and their families.  Check out your neighborhood playground for a few minutes or walk around the block when it is time for a break. 

5.  Go easy on your children and yourself.  Moving is stressful for everyone.   Remember to take care of yourself.

6.  Give your children an area to unpack.   Preschoolers through highschool can always help whether it is dishtowels in a drawer or other simple areas.  You can always redo it later and they will feel like an important part of the move and family.

For more tips on moving with kids, pets or setting up your household visit my raleigh real estate website or call my office and speak with my team.  We all have moved around or to the Raleigh area from other parts of the country and know what it is like to be in transition.   We are here 24/7 to help make everything about your move easier.

Linda

Refreshing a home here in the Greater Raleigh area starts with  removing wall paper and adding a fresh coat of neutral color paint on worn walls to provide a wow factor without a big expense. Something that often gets overlooked in painting is the scuffed trim and dingy caulk lines. The trim needs a fresh coat of paint too and everything should be re-caulked to look like new. Door hardware is also a quick fix as well and switching out knobs and pulls in kitchens and baths to catch the eye and revive an entire room. Taking it a step further update faucets, lights and even switch plates can take a space from dated to feeling new. If you have white cabinets with polished brass pull change them out to oil rubbed bronze and notice how the eye now sees the room instead of the shinny objects on your cabinet fronts. If carpets are worn or any color other than neutral refresh those too. Just ok will not bring you a sold sign in our competitive Triangle Real Estate Market.  If you can’t find the time or know how to do it, hire a professional.  The investment will be well worth it in the long run. 

Don’t Overlook Your Exterior  Home Curb Appeal

The fresh new look you have on the inside will never be revealed if curb appeal doesn’t draw them in.  Don’t forget to make a good first impression. In real estate this begins on the outside. Do you see  home buyers  in Raleigh, Cary, Wake Forest or Apex driving past your home?   How fast do they drive?   Do they tap the brake lights or do they come to a full stop? Curb appeal is 80% of a  home sale.  If the buyer doesn’t like the looks of the outside they will never come inside to see your beautiful  home. So refresh the paint on you front door and shutters. Remove the window screens, powerwash the driveway and sidewalk, clean the garden, plants some flowers, add fresh mulch and put out a new door mat. Don’t forget to look at your house the way your buyer will. If your exterior light fixtures or door hardware is dull or rusted replace them. Most important of all, if your shrubs are overgrown and covering windows or tree limbs are hanging down so low you can’t see the house, trim them back, cut them down or replace the shrubs. “If you can’t see it you can’t sell it”. 

Refreshing your home  to make it compelling may also include new counter tops or covering vinyl floors with tile.  However, this depends on what your competition is offering in the same price bracket.  If you would like to meet with me to determine if that expense would be needed or an over improvement that will not bring you a return on investment, just give me a call.  I may be reached at 919-235-0007 .

Hope you are having a great week.

Linda

As parents we teach our children to never take candy or get into a car with a stranger. Yet everyday around the world strangers call into real estate offices and ask the eager 100% sales commission based real estate agent to meet them at a house so they can see it. What happened from childhood to adulthood that we forgot the lessons our parents taught us?

This month in the Greater Raleigh Area, a female real estate agent was held at knife point and raped in a vacant new home. Every year somewhere in the country reports are sent from the National Association of REALTORS and local real estate board office telling of another tragic story of rape, robbery or murder. Last year a female agent who was raped and stabbed multiple times survived because she was wearing a Blue Tooth and had enough strength left to reach her ear piece and press the button for 911. Many REALTORS rushed out to buy Blue Tooths for a new level of protection. I think they missed the main lesson and that is how many violent crimes occur against REALTORS. It is amazing to me how all of these reports of real estate agent found dead in basements and robbed at open houses we  still meet strangers at houses and the parents who warn their own children never talk to strangers expect us to do it and get mad when we say no.

As an Real Estate Industry Our Home Showing Practices Need to Change

Everyday in Raleigh the telephone rings  into real estate offices where people are out in front of a home for sale and they want to know if someone will show them the home. When we tell the prospective home buyer our company policy is to meet in our office first, qualify them financially, copy their driver’s license, make an appointment with the seller to view the home and then drive them to the property for the showing they feel it is a waste of their time and are insulted by our protective measures.  As you read this blog ask yourself…would I be insulted if a REALTOR said they wouldn’t show me a home unless I first went through that sort of security screening? Of course you would be insulted. You are  in a hurry, you are not a bad person, you are a serious home buyer being treated like a criminal. You will hang up the phone and call another real estate agent who gladly put their life at risk for a chance at a small commission. Pop Tart REALTORS is what I call them. They pop out of the chair and speed off to a vacant house to meet an unqualifed stranger. When you think about this common occurance, isn’t is kind of crazy thing to do?

As Experienced Real Estate Agents We Need to Help Safeguard Our Newer Associates

Last week I had one of my young new REALTORS all excited becasue she had gotten a call from a  Doctor who wanted to see a 2 million dollar estate home in Raleigh. He had found it on my web site www.lindacraft.com.  All she could see in her mind was the big commission she would earn if this Doctor bought it. As a 24 year veteran real estate agent here in Raleigh all I could see was danger. I asked her are you meeting him in the office? Yes, she replied.  Have you Googled him and checked LinkedIn as I asked? Yes, she couldn’t find him was her answer. Have you requested a letter from a lender or banker showing proof of funds for purchase? No, she meekly confessed and then quickly asked what if he gets mad. Where I responed, if he has money he will understand and be proud to show you his financial strength. If he doesn’t he will get mad and you will never hear from him again. Either way you have your answer. As she dialed his number to make the requests I emailed my fellow members in the Triangle Luxury Home Marketing Group to see if any of them had encountered a Doctor with this name. Within 10 minutes 2 emails popped into my account with warnings to stay away. He isn’t a doctor, lives in an $80,000 town house and has no money. We had our answer and our seller didn’t waste their time and interrupt their life.

Let’s Stand Together and Change Our Ways

Everyday in the world of Raleigh real estate someone is posing to be a buyer when they are not, sellers are also told to vacate their house during all home showings and real estate agents heed no safety warnings even after reading graphic details from stories of other victoms. Something has to be done to change this system. Real estate agents need to remember their Mother’s warnings and the world needs to understand how dangerous it is to demand REALTORS to meet strangers at a home for sale.   The National Association of REALTORS is the largest association in the world. It is time to commit together to change a system that has been broken from day one.

Linda

The Biggest Real Estate Problem We Have in the Raleigh Region

is that we are not seeing many move up buyers. This is causing many sellers to compete for a sold sign and has driven home prices down. The listing inventory of homes for sale is still high and many sellers have reduced their home prices several times and still are not sold. The average home list price to sales price is  96% if sold in the first 30 days and 89% if price reductions occur. With declining home values, low interest rates and tax credits you would think real estate here in the Greater Raleigh area would be booming but, it isn’t. Everyone is busy showing a lot of houses but, the truth is Triangle real estate home sales are still lower in 2009 than they were in 2008.  

Let’s Look At Some Contributing Housing Market Factors

1.  First Time Home Buyer and Tax Credit  

Raleigh area homes  under $300,000  have been driving the market as our first time home buyers are out looking for their dream home and an $8,000 free gift from the government. The $8,000 first time home buyer tax credit is due to expire in 102 days.   Many people who have been unsure about the economy and their jobs have decided to wait until the last minute to find a house.  Not a good idea. Every first time buyer needs to get busy now. Procrastination can cause you to loose your chance at $8,000 and pay more for a house. On July 31, 2009, new mortgage regulations went into effect that can extend a real estate closing to approximately 45 days.  This means in order for someone to use the credit they have to hire a REALTOR, find a house they want to own, negotiate an acceptable contract and apply for a loan by October 15 in order to be assured a closing before December 1st. I believe this fall we may see Raleigh real estate priced below $300,000 spike up in value as those that waited to the last minute are now in bidding wars over the best houses left in the market. 

2. Life Change

People in all walks of life have to have some place to call home.  Some of our Raleigh market activity comes from every day situations where people moving  are  merging households, downsizing, having kids and running out of room, relocating due to a job transfer, divorce, death or need a change due to health reasons.   This type of activity always happens in our Raleigh Real Estate Marketplace and will never change regardless of market conditions.

3.  Short Sales and Foreclosures in the Greater Raleigh Areas

Today’s investor loves our Raleigh real estate market. They know now is the time to see the highest returns on a home purchase. Raleigh is ranked in the top 10 cities to rebound fastest. Homes in the Raleigh, Cary, Apex, Holly Springs and Wake Forest real estate markets have about 20% distressed properties and cash is king. People who have patience, good credit, or cash in the bank are another segment in our Raleigh real estate market. If you want to invest in these type of properties look for an REALTOR with a CDPE designation. It is not a traditonal transaction and you will need someone with experience to guide you.

4.  Supply and Demand

Standing inventory is a real problem in the Greater Raleigh area.   The absorption rate is 10 months to 39 months in some price ranges and locations. In my recent blog posting “Home Sellers Need Tough Love in this Economy” I talk about how some Triangle Home Sellers are experimenting with the market.   As I said before, if you don’t need to sell your home right now, don’t list it.   Yes, I am a Top Producing Real Estate Agent in the Triangle area, however, I believe in helping people and not just closing a transaction.  Our real estate market is still over saturated with homes that are not selling.  It is a fabulous time to buy a home and one will find many great deals out there, but if you don’t have to sell, please wait.

If you have questions about the real estate market here in Raleigh or would like to receive new listing alerts, please don’t hesitate to contact us.   We are here to help you make wise decisions about your home.

Linda