Our team had the priviledge of sponsoring the Great Pumpkin Day at the State Farmer’s Market. Larry & Amy Massengill of Four Oaks won the 5 Day Cruise Drawing that we had at our booth. Check out the pictures here.
RISMEDIA, Oct. 20, 2008- had one of the best articles I have read in a long time about the true state of the real estate market. It focused on the power of emotions. I wanted to share some of their comments mixed in with my own commentary on the Raleigh real estate market.
Fear is a powerful motivator. It can drive banks to failure, nations to war and people watching their growing waistlines to put down that third slice of pizza.
Extreme fear, mixed with hope, was behind recent manic gyrations in the world’s stock markets and has been the only reason why the buyers and sellers in Raleigh are real estate frozen. The Raleigh real estate market has so many buyer and sellers both wanting the same thing, a new home. Yet fear is keeping them from moving towards one today when the interest rates are low and the inventory is plentiful. Interest rates are expected to grow to 8% next. Whatever the buyer thinks he will save by waiting will cost him triple with a higher interest rate. Most buyers never calculated the cost of waiting. They will be shocked when they realize that the $10,000 they thought they would save by waiting actually cost them $200 more per month in a payment which equals a $72,000 loss over 30 years. It is sad for me to watch FEAR keep buyers from making a great investment decision. Remember in 1990 when the media said, “don’t buy real estate”. I bet everyone who bought in 1990 is very glad they did. 15 years of incredible appreciation is what they were able to take to the bank.
Hope also is a powerful motivator.
To think, the financial crisis gripping us today started when people imbued with hope purchased homes they could not afford. That misplaced emotion led to a massive housing market bubble.
The bubble started bursting in other markets two years ago. It appeared for awhile that Raleigh was not going to suffer because of our healthy economy. The reality is the Raleigh real estate market had a small bubble burst last June. By comparison it should have remained very small but, fear is making it bigger every day. We have many sellers struggling to sell and buyers afraid to buy for unrealistic reason caused by false fear.
The media and the financial districts both live together in New York. Doom and gloom live next door to each other. They see each other daily at the local pubs, delis and subways. Doom loves gloom because it sells their air time and the fall out for Raleigh of doom and gloom spending so much time together in New York is buyers missing great houses and seller growing weary by waiting.
I just spent three days at a Mastery Weekend event with top REALTORS from all over the country. I spoke to agents from New York, Florida, Nevada, California and Virginia that reported 50 to 80 percent of their sellers are in short sale. The Raleigh real estate market is nowhere close to those numbers. Short Sales have grown but, I am only experiencing approximately 8% of my market. We did not have a bubble because our appreciation rates have always been steady. Raleigh real estate is experiencing a ripple effect but it is small by comparrision.
In September Raleigh was ranked as the 7th best real estate market in the country. I am so thankful to be living and working in Raleigh! In spite of fear I have had several homes sell recently with multiple offers. I also have others that sit and wait for no reason other than fear. Great houses, perfect condition, priced well and not sold because buyers are frozen with fear.
Anger, is also at play in the Raleigh real estate market.
It was a seller’s market 18 months ago and it is a buyers market now. The industry always fluctuates between those two groups. As a result, buyers and sellers deal with different emotions depending on which way the pendulum is swinging.
Buyers are afraid to buy because they think prices are going to go down more and sellers are really angry. Sellers express anger by saying things like, ‘My neighbor got $50,000 more for their house a year ago. Why can’t I get that now?” “What are you going to do to sell my house?” “Why won’t buyers make an offer?” “I am going to take my home off the market and wait”.
By contrast, a year ago, it was buyers who were “really angry because prices were so high. Buyers found themselves competing with other buyers for the same house driving prices even higher. They experienced the frustration of losing homes they really wanted in bidding wars with other buyers. Starting over to find another home with time pressures caused by relocation or pending sales date on their existing sold home.
While many buyers are afraid to purchase too soon, those that do make a bid on a home become very cocky. They come in with low-ball offers and they ask for everything! They want everything fixed, and they expect a low price too.
Desperation, of course, is another powerful motivator.
Amid financial chaos and the volatility of world stock markets, it is puzzling, yet somehow reassuring, that the most powerful forces controlling our economic destiny happen to be our own emotions. Isn’t it time to get them in check before our country implodes? We have the power to control our emotions.
9,155 total homes for sale in Wake County
1,340 total homes closed September 1, 2008 thru October 17, 2008
1,530 total homes under contract and pending closing
Data retrieved October 17, 2008 at 5:58 am from the Triangle Multiple Listing Service
Absorption rate is 5.98 month supply.
Last Monday I had the special opportunity as a Carolina Hurricanes Corporate Sponsor to participate with Jo Ann Gardner, Muriel Bijeau and Brenda Miller from my team in the 11th Annual Kids in Community Foundation Golf Tournament. This event is held in order to raise funds to help the Carolina Hurricanes be able to present grants to Communities in Schools, Boys and Girls Club, Durham Public Education Network, YMCA of the Triangle, Triangle Family Services, and the Danielle Karmanos’ Work It Out Program.
Our team was set up at the 18th hole at the beautiful Prestonwood Country Club in Cary. Many of the Canes Players and staff paired up with the other tournament players. Everyone seemed to have a great time- I know that we did. To see pictures of the event, feel free to check it out on our website: Linda Craft Kids in Community Photos.
Last week the Wall Street Journal economist reported that the bottom has been reached in the metropolitan cities and they predict a return to begin immediately in those cities. They also stated that other areas are expected to follow soon. The lowering of interest rates into the 5% range has helped give every area a spark.
I spoke to a top agent in Las Vegas, an area that was hit first and hit hard and she said from January until July she only had 4 sales. In August she had 8 sales and she reports the phones are ringing off the hook. Sounds like the economist nailed this one.
Other rural areas around the county are reporting that prices have fallen to where they were 5 to 10 years ago and they believe it will be next year before they hit their bottom and begin to see a return in their market.
In Raleigh, our real estate market continues to be one of the strongest in the nation. Our prices have fallen mainly by the amount of appreciation sellers hoped to receive. Most sellers price their homes by taking past sales and adding 8% to 10% appreciation. What we are experiencing is the homes that have closed have sold without “hopeful appreciation” added to them.
Many people have a false sense of our Raleigh reality because they see a lot of homes failing to sell or many sellers making numerous price reductions. This is only because the seller didn’t price their home in today’s market. They used old school thinking of adding appreciation to last years prices. This formula doesn’t work in a down market. I am rarely seeing sales price below their original investment. When I do see this it is because they purchased their home at the end of the peak or in the past 18 months. Most closed prices are equal to where homes were selling in 2006. According to our local TARR Report the closed sales in Raleigh have a 2% gain. People who purchased in 2006, 2007 and 2008 in Raleigh will see strong appreciation in the next couple of years. When the National real estate market returns to their full speed it will be light speed in the Raleigh real estate market. We have so many buyers sitting on the fence waiting for a sign. Don’t wait to long or you will miss the best buying season in history.
The News Media reports on the National Real Estate Market. You can’t judge what the temperature is in Raleigh by watching the weather report in Florida. In Raleigh, you need to buy now. We have a great market. Here are facts from (MLS) Multiple Listing Service.
Raleigh Homes For Sale ….4,473
Raleigh Homes Closed – Year to Date …. 5,181
Raleigh Pending Sales …967
Raleigh Absorption Rate …4.6 Months (A normal market is 4 to 6 months inventory)
If you have questions, or would like to see a copy of the Triangle’ s T.A.R.R. Report, feel free to call me at 919-235-0007.
I hope that you will enjoy this great weather we are having this weekend. My team and I will be at the Caniac Carnival today with the other 20,000 fans celebrating the 2008-09 Carolina Hurricanes Season Opening Week. This event is held at the RBC Center in Raleigh and runs from 10 am to 2 pm. Our team will be there with a large inflatable slide and a drawing for a 5 day cruise for two. At 3 pm the Carolina Hurricanes will offer a scrimmage game that is free to the public. I hope you will come by to join us.
The stock market fell 300 points yesterday which means mortgage interest rates will follow. It is now the perfect time to buy a new home or investment property. Many people feel they need to wait on a home purchase because of the war, fuel cost and the upcoming election. Actually, that is a huge mistake. There has never been a better time in Raleigh real estate history to buy than right now. Think about this…when would you rather buy a new home or investment property? When there are multiple buyers bidding the price up? Or now, when there is less competition in the market and more products available in Raleigh, NC than ever before?
Sellers fear tomorrow will be worse than today so they are negotiating 2% to 5% off of last years prices. This means you are saving 8% to 12% on every home out there. Call your lender and lock in a low rate and buy now is my advice. As soon as consumer confidence returns in our country prices will go up. There are so many people who want to buy and are just waiting for a good sign. All it will take to change our buyers market to a sellers market is a couple of days where the media changes its tune and speaks positively about our economy and the housing market and it will be a buying frenzy. Buy now and save. The sky is not falling you have a great opportunity right now don’t lose it. How many times have you said I wish I had bought land 25 years ago in Wake Forest? How about North Raleigh and Cary when it was farm country and cheap? Don’t you wish you had someone encouraging you to buy back then? Well then is now. Don’t look back on 2008 and have regret because you waited.
Hope you stay dry this weekend,
I flew into my birth town, Evansville, Indiana, to surprise my 77 year old mother for Mother’s Day this year. My brother picked me up at the airport on Saturday and he had invited Mother to meet him for dinner at 5 pm. (The time all elderly people seem to enjoy dining the most) I had sent her a card with a note stating that her present was coming in a separate delivery and to keep an eye out for it. She was totally surprised when she walked up to the table and saw me sitting there. It felt good to pull off such a big surprise and even better to see her so happy.. I spent all day Sunday “spoiling her” to quote my mom. We went to lunch on Sunday, shopping where we found several new outfits for her and then to dinner that evening where my brother joined us.. It was a wonderful 48 hour visit with her but, it was sad to see so many for sale signs and very few sold signs to go with them in my home town. I can’t help but, study real estate where ever I go. I love my mom but, real estate is my passion. Only 45 sales were reported in the local paper that week in Vanderburg, County. On the plane ride back to Raleigh, I sat next to a nice man from Michigan and he was sharing with me how bad the real estate market is in his area. It made me very thankful to live in Raleigh, NC where are market has only fallen a couple of percent and inventory is 3 months to 10 months in some zip codes with a great job market to absorb the over abundance quickly. Experts believe Raleigh will have the over abundance gone within 6 to 12 months and prices will remain relatively stable until then. I hope the experts are correct for Raleigh homes and that your area will bounce back soon too. New home construction has slowed down around the country and this will help re-sales have a better chance of selling faster.
I have some tips I tell my sellers to do to maximize buyer appeal and increase their chances of selling faster and for more money. Whenever you are trying to sell please email me and I would be happy to email them to you. I hope my tips will help you too and that you had a great Mother’s Day as well.
I hope I will get to see you this coming weekend at Millbrook Exchange Park, 1905 Spring Forest Road. It is the 19th Annual Bark Around the Park event Saturday April 26th 11 am to 3 pm. It is a lot of fun for the entire family. Including your 4 legged family members. You will see dog tricks, vendor booths, and Wake County Animal Care, Control and Adoption will be offering on site rabies vaccinations for $5.00 and micro-chipping for $10.00 beginning at 11am. There will be a lot of vendor booths where you can see the latest in pet care and pet spoiling. Something I know all dog lovers can do very well.
Our office, Linda Craft and Team, REALTORS are one of the major sponsors every year. This year we have invited Stormy from the Carolina Hurricanes to be at our booth. We are also hosting 3 dog bone hunts where we will be giving out over 600 dog bones; setting up a DJ in the back of our moving van (in case of rain) and you can register at our booth for two Carolina Hurricane tickets in the Lexus Champions Club. The tickets include dinner and four drink vouchers. Our tent is the first one on the right as you enter the event. I hope you will stop by to say hello, register for the tickets and meet my two precious dogs Bandit and Katie.
Bandit is a 5 year old Shitzu and Katie is a rescue dog. We think she is around 13 years old. Katie is a Pitt Bull Staffordshire Terrier mix. She is as sweet as can be. Don’t let the Pitt Bull part scare you. Katie’s tail wags so hard her whole body wiggles. Years ago Katie was found eating out of garbage cans in Baltimore. She was skin and bones and very sick. Someone took her to a vet and had x-rays done. They found a bullet in her back hip and she also has a tattoo where she had been in the pound. Now she lives like a princess at my house. She gets groomed every week and has her toenails painted hot pink to match her bandana. Her bed came from Dogmopolitan (an animal print chase sofa just her size) Bandit was born in Smithfield, NC and he moved into my house as a puppy. I named him Bandit because one look at him and I knew he would steel my heart, take up my time and rob my bank account. He has lived up to his name because he has stolen my heart. I could tell you lots of Bandit stories but, I will save them for another time. I am sure if you are a dog lover like me, you have your own stories to tell. Please share them so people reading this blog will not think I am some sort of nut. Only dog lovers can relate and understand why a 53 year old successful business woman would spend time writing about how wonderful her dogs are. Help! Support me in telling the world how great it is to have a dog in their life.
Make it a great day!
Hey Everyone, (in case you are not from Raleigh “Hey” is a southern thing, it means Hello)
I wanted to let you know about a great new restaurant that opened recently in a small strip mall in North Raleigh. The name is Savoy. It is in the shopping center at the corner of Lead Mine Road and Sawmill Road. I had the best scallops I think I have ever eaten and my husband had duck and said it was fabulous. I also heard the steak was amazing. It is family owned and operated which I just love to support, prices are average for the menu, atmosphere is very nice and I hope you will check it out and agree. Please let me know your thoughts.
My all time favorite family owned restaurant is still Hayes Barton Café especially the filet, and VIC’S at city market is another one very high on my list and then there are a couple in Cary, and of course Durham, and we can’t forget Chapel Hill. Wow the RTP area sure has come a long way. I remember when the Charter Room, Swains, and Slugs were about the only fine dining in the area. People also brown bagged their wine because restaurants didn’t serve alcohol. Do you remember that? Seems like yesterday to me.
If you know of any great restaurant please share. We love to try new places.