Well, we all lived through the end of the Mayan Calendar! So, what next?
December has been unseasonably busy. Primarily its been new buyers coming into the market that are just beginning to look not just buyers that have been in the search for sometime wrapping up their searches. This is exciting news! It’s been many years since we’ve seen a genuine uptick in homebuyer traffic this late in the year. This tells me that we likely to have a busy Spring real estate season. There has been much new about “the Fiscal Cliff” but it appears to me that the increasing numbers of people coming through my company’s doors just don’t care and don’t relate to issues like “the Fiscal Cliff”.
The potential Homebuyers that my staff and I are talking to are people that have been waiting for several years to buy at “the right time” and they perceive that opportunity is likely to be passing them by if they wait too much longer. Most Homebuyers we are seeing are expressing their concern about missing a closing window of opportunity of low home prices and low interest rates. Often the challenge, at this point, is not finding a credit worthy Homebuyer but finding a home that is in financeable condition for a reasonable price.
To be sure Bank/Lender Owned REO properties represent a large section of the market probably 25-30% of the home market in Central New England unfortunately a very high percentage of these properties cannot be financed with out obtaining special re-hab financing such as an FHA 203K loan. These properties remain especially attractive to first time homebuyers however, lenders are slow to make these loans and many times first time buyers do not realize the extent of the work needed or they anticipate they can “do it themselves” which is often impractical from a lender’s perspective.
So here’s how the Spring real estate market is likely to sort itself out. Buyer’s will be coming through the door in increasing numbers through the first three months of the year and then volume of buyers is likely to level off and stay constant through mid-June. Houses in good locations, in good condition, in good price points are likely to sell in days and weeks rather than months and years. There will be “clinkers” in all neighborhoods that just won’t sell or have interest because of some flaw that the Home buying public will walk away from either price or condition most likely. Clean houses will sell at a 10% premium over the same house in the same neighborhood and investors and “flippers” will still be an active part of the market buying these properties at significant discounts and returning them to the market in 60-90 days.
The most active price range is likely to be between $145,000 and $170,000 in our area and it very likely that there will almost no homes available in the range from $100,000 to $135,000. There will be junk properties under $100,000 which will be selling basically for lot value but the range just of $100,000 is likely to evaporate quickly as it’s too low for a good house and too high for a junk property. The most active markets, as measured by rate of turnover are likely to be anything in Swanzey, which never has enough inventory, Marlborough or Troy followed by the largest volume of sales in the City of Keene. In Vermont properties in Bellows Falls and Saxton’s River are likely to take off in price as will Brattleboro. In Sullivan County Newport has already seen an explosive 24% increase in housing prices in the last year and Claremont is not far behind. Winchendon and Athol will probably see ten to fifteen percent increases in home prices over the next year.
By Dick Thackston CRB, ABR, ABRM, Broker NH, MA & VT