The State of Real Estate in 2009

The state of real estate in 2009 is pretty interesting. There are so many things happening, from an overhang of inventory and low rates to a fringe of distressed property sales and new players in the lending game.

Things are different. Community banks now offer competitive loan products and good old FHA financing is now viewed as downright attractive. Non-purchase lending activity has skyrocketed, Appraisers have new stricter appraisal forms and non-profit housing organizations are now knee-deep in redevelopment of REO properties.

With all of these changes opportunities abound at the extremes of the market, which today offer the most inventory. If you take a look at an On Market Snapshot statewide of single family homes from April 2009 and compare it to April of 2005, the low-end (under $300K) and the high-end (over $1M) have the largest percentage increases of inventory, see chart below. 

Realistically, opportunities are there for anyone with an actual need for a home. What will the future hold? Quite simply - a majority of homeowners with very low interest rates unable to use their homes as no fee ATM machines or liquidate. What exactly will that market look like? I'll have to think about that.

 

A New Take on an Old Super Bowl Ad - Wassup 2008

For a good laugh, watch this commercial. Many of you may remember the original ad from the Super Bowl, 8 years ago. For some reason I find it comforting to laugh about what we've been through this year. Hopefully you'll enjoy this video too, no matter which candidate you voted for this past week!

Town Meeting and The Board of Selectmen

Town Meeting is this Saturday March 27th 2008 and like every year there are a lot of issues on the Town Warrant to be addressed. The usual political fair of overrides, health care cost increases and the need for new town vehicles have been augmented this year with a couple of interesting ideas: a wind energy system bylaw and a museum bylaw. Both are fairly new proposals and for better or for worse Harvard has always been skilled at studying new ideas until quite frankly they become old ideas. So we'll see next week what happens!

We'll also be having Town Election is this Tuesday April 1st 2008. This year voters will be electing a myriad of volunteers including positions in two key/critical offices: three positions on the Board of Selectmen and two positions on the School Committee. The good news is that we have mostly capable candidates and a town full of informed voters. Check out The Harvard Hillside, The Harvard Press, and The Harvard Post for candidate profiles. Why do we have three papers you ask? Boy do I wish I knew - print advertising isn't exactly free!

The Spring Market - And They're Off!!!

Well it's March - officially my least favorite month of the year. Lot's of people say February but for me March is a total kick in the teeth and by this time every year I just can't wait for spring any longer!

So what's happening with the spring market? Well so far in Q1, the weather, the headlines and the lenders have not been our friend. Location, price and condition in Q2 will continue to be key and in some markets high or even low inventory levels will also be a factor.

What I do know for sure is that buyers don't have as much money available to them today as they did before. So secure your financing up front and work with a knowledgeable Realtor in your market that really listens carefully to what you are trying to accomplish and does their research.

Training for Triathlons in Harvard

One of the best features of the Harvard landscape is its varied topography. Whether running, biking, or just plain walking around you'll find an endless number of routes to get your heart rate up whilst enjoying the lovely country scenery.

Harvard is my favorite place to train for triathlons. Running early in the morning from the center of town straight "up" Old Littleton Road across Pinnacle over Oak Hill, to Slough and then down Bolton Rd is one of my standbys. I also can't resist heading out over Depot Rd to Prospect Hill to Madigan to Underpin and Lover's Lane. Both of these routes offer rolling hills and incredible country views. If I want a mental challenge I head out Littleton Rd - a straight shot for as many miles as I can bear or sometimes I head to the town track for some tempo work.

Cycling in Harvard is also a great challenge. On the weekends the town common transforms into a rest stop for numerous cyclists on their way to crank out 30-50 mile rides. I trace a couple routes taking me from Harvard to Bolton to Littleton and back. One thing on all of these rides is the same, its uphill all the way home!

Swimming is the last leg of my training and honestly, I just love swimming at Walden Pond in Concord. I typically see a number of people swimming across the pond and back while I'm out there and safety in numbers while swimming is my strategy. If I found others interested I would definitely swim at the Bare Hill Pond in Harvard, that way I wouldn't have to pay for parking!

Tug of War - Fair Market Value?

I just published a pretty comprehensive look at the town of Harvard's real estate market in two market reports on HarvardRealty.com. I think my blog readers and property sleuths will find these reports very helpful in level setting the Harvard market for 2008.

As you are well aware, it has become a tug of war between buyers and sellers to identify the fair market values of properties. To keep the market moving we need actual sellers. What do I mean by "actual sellers"? Actual sellers are property owners who want to sell their properties within a reasonable timeframe and are realistic about today's fair market value of their property based on recent comparative market statistics and projected market conditions.

Last year the average original list price for single family homes in Harvard was $689,524 and the average sale price was $590,503. That's a $99,021 difference or a 14% price reduction in a market where price was just about everything. To be fair I looked at a neighboring market to see what kind of pricing gap they faced. So let's take Bolton - Bolton's average original list price was $670,832 and their average sale price was $621,836 which is a 7% price reduction, a difference of $48,996.

In general, it is my opinion that a 14% tug of war on value in Harvard is pretty painful for both buyers and sellers. No one wants to put an offer in on a property that is $100,000 out of their price range and no one wants to see an offer that is $100,000 less than what their asking. The truth of the matter is that fair market value is much easier to deal with for everyone when it is just that - fair.

The Correction - Prices of Homes in Harvard

Some may find the 2007 sales results for the town of Harvard surprising even though a market correction has been widely predicted by experts for quite some time. As you can see at left sale prices are not climbing exponentially like they were in the early part of the decade.

While Harvard experienced a 36.1% median sales price increase from 2002 - 2004 it recently saw a 8.6% median price decline from 2005 - 2007. In 2007 alone the median price for a single family home in Harvard declined by 6.8% to $550,000 down from $590,000 in 2006.

Pricing, property condition, and inventory levels will continue to pose a challenge for both buyers and sellers laboring through this market correction in 2008. Remember I'm here to help!So if you do want to make a move give me a call and I'd be happy to help you make the best real estate decisions.

For more detailed market information, or to ask a question call me at 978-456-3855 or email me at: marysprague@harvardrealty.com.

The Value of Education - 2007 MCAS Results

Whether relocating from out of state or making a move from school district to school district MCAS is one benchmark used to compare communities in Massachusetts and these rankings are one of many factors to consider when evaluating school districts.

It is important to note that Harvard Elementary and Bromfield (the town's public high school) typically perform very well on the MCAS standardized test and generally rank between 1st and 15th in the state depending on the year and the grade level. Boston.com has compiled a great section of their Website devoted to MCAS. Check out our district's 2007 10th grade ranking.

Congratulations to the teachers, children, teens, parents, and families that all contribute to our continued MCAS success!

Harvard Farmer's Market

Three Cheers for the new Harvard Farmer's Market! Open Saturday mornings 9:00-12:00, Labor Day Weekend through October. The event takes place rain or shine in front of the Elementary School on Route 111 and sells mainly local produce, eggs, meats, baked goods, flowers, and herbs. This is a great way to support local farmers and spend time with members of the community! Did I mention there is music?! It's a great cause, just be careful parking, this attraction draws quite a crowd!

What's a Seller To Do?

If you have read recent headlines you would know one thing for sure, that credit right now is TIGHT. The financial markets have been rocked by investment fallout due to what analysts like to categorize as "sub-prime lending" in the real estate market. What had recently become America's new favorite investment is now turning into many Americans biggest nightmare.

The unfortunate truth of the matter is that sub-prime lending is only one part of this difficult story. It seems that a majority of qualified homeowners also took advantage of the "easy money" financing and refinancing days and are now finding themselves with zero equity or even worse upside down. It turns out that borrowing equity to remodel a kitchen, pay a college tuition, consolidate other debt, or worse by a second home, might not have been the best idea.

What does all of this mean for sellers in towns like Harvard? Back to basics really - location, price, and condition. Borrowers today see the market declining which means that they won't be able to refinance and borrow from their equity anytime soon. Therefore, basic affordability and condition is paramount. Where once a borrower could refinance to update a kitchen, a bath, or install a new furnace, they now need to use their own cash. Since utilizing credit/equity is no longer possible, pricing is everything. So buff up that 1970's Colonial and price it as best you can, and remember, top dollar days where a home sale could augment your retirement is now "so 2005".