Real Estate Market

Homes sales in July 2010 from the Austin Multiple Listing Service show that home sales decreased approximately 25% compared to July 2009. 

These are probably the first true post tax credit sales results, since closings in July were sales that ocurred in May and June. 

We expected this, as showings and contracts in May and June were will below typical for this time of year... we already knew that the number of homes placed under contract in May fell 34% from a year ago.

Unfortunately slower sales was not unexpected, as the tax credit was nothing less than a phenominal incentive for home buyers. It would have been an incredible shock if sales had maintained the same pace as when the tax credit was available.

The number of homes for sale in the Austin market increased from last year, just over 16.4%, resulting in a 7.4 month supply of homes on the market... June and July of 2010 have more homes on the market than we have seen since 1990.

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More Short Sales properties in more price ranges are available in Round Rock and Austin real estate markets than at any time. This may sound like bad news, BUT the fact that home owners are taking advantage of Short Sales means that more homeowners are avoiding foreclosure.

This is good news because Short Sale homes are discounted less than foreclosures, and thus have less negative affect on Austin area home values. It is true that Short Sales homes sell for less than market value, but they will typically sell at 85-90% of fair market value compared to foreclosures, which sell for an average of approximately 70% of fair market value.

It is also a positive for the home owners because taking advantage of the opportunity to use the Short Sale process means less negative impact on their personal credit than a foreclosure would.

It is also positive in a less obvious way, since the fewer homes that banks and mortgage companies repossess, the better their balance sheet, and the more profitable they will be.  The strength of financial institutions is vital in our economy and managing Short Sales properly plays a small but important role.

As an everyday part of the Austin market, Short Sales help home buyers and home sellers. As mentioned, home sellers avoid foreclosure and do less damage to their credit, while home buyers are able to purchase homes below market value, while getting them in better condition, with home warranties and more secure Title.

Yes, Short Sales are just an everyday part of the Austin real estate market, and may continue to be for another couple of years, but accomplishing Short Sales helps Austin home values, it helps the home owners, and home buyers, so how can we not manage this process as professionally as possible... we owe to our clients and to ourselves!

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Many home sellers are asking this question?  With fewer buyers looking at homes, what are the chances of my home selling this summer?

There are several ways to answer that question, so let me see if I can keep from confusing the issue.

First the statistical answer:

In this market, statistics have show us that there is an approximate range of 12 - 19% as far as the chances that any given home will sell in that month.  This statistic changes each month, but a trend is easy to follow.  This means simply that well, you have about the same chances as you did in 2008 and 2009.  Things have not changes all that much.

Your best opportunity to increase your chances is to hire a real estte agent or broker who has a better performance record than the market. If the market is selling at 16% and your agent sells homes at a rate of 26%, then you have a better chance of selling your home.  I guess I could be remiss if I did not point out that we have a much better chance of selling your home than the average agent in the market, as the stat just mentioned is ours. 

Secondly, the general answer is this, there are fewer buyers in the market today than 3 months ago, as inidicated by the dramatic reduction in contracts placed on homes in May.  However I can determine this well before the statistics come out because we can see how many buyers are looking at homes online and physically going to see our homes on the market. 

The number of buyers looking at homes online has decreased the similar levels as before the tax credit.  Not an exciting bit of information, but remember that the Austin real estate market is one of the best in the U.S., and still is.  We are selling homes, we are ust selling them with fewer showings and a little longer market time, so stay encouraged... your home can sell even now!

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Thank you for taking a few minutes, I hope the information was helpful.

Make it a Powerful Day!

Sincerely,

Stuart

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