Real Estate Information

The good news for today is the sun is shining in Lake Geneva and the Cubs are playing baseball on the radio this afternoon.  Even if you’re not a Cubs fan, that’s good news because it means that the worst of the winter is behind us and Spring can’t be too far away.  But it’s probably a little early for putting away the winter coats and boots just yet.  I’m guessing Mother Nature has a least one more sizeable snowfall for us before winter is officially done. 

As I’ve indicated the last few weeks, the signs of an increase in calls and inquires continues and I think we will see that resulting in more showings in the near future, but it hasn’t really happened as of yet.  Knowing that the average time between accepted offer and closing tends to run between 30 and 45 days, it is still too early to have any measureable signs of an increase in the actual closings YTD. 

I’m having lots of conversations with potential Buyers of various types of property and various price ranges in the Lake Geneva real estate market and there continues to be a concern by many about whether this is the right time to move forward with a purchase.  I even had a conversation with an appraiser yesterday who called me looking for some help with a refinance appraisal he was working on and he came right out and asked how we are able to come up with price recommendations these days with such mixed signals in the market and a lack of actual recent sales to go by.  It’s actually a good question. 

I had occasion to sit in on a speech this week given by an economist for Stewart Title whose credentials includes a PhD in finance with a minor in statistics and a master’s degree in land economics and real estate from Texas A&M University.  He had some very interesting things to say about the real estate market, not all of it positive and many comments about what’s going on in Washington these days with spending.  His outlook for the future of commercial real estate was extremely negative but he had a rather mixed message for residential real estate.  I don’t tend to put too much stock in prognosticators these days but his talk was filled with a lot of very specific charts and statistics.  His main point of focus was on the number of home sales as a leading indicator of the future and not on average sale prices, which is what much of the media tends to focus on.  His point being that with a high number short sales and bank owned property being sold, it is only natural that the averages will go down as those sale numbers are reported.  Getting that inventory sold and off the market is actually a good thing and it doesn’t necessarily mean that overall values are declining.  If you have any interest in viewing his Power Point presentation, drop me an Email message and I’ll be happy to pass it along.

The weatherman says we have a sizable snow storm headed our way in Lake Geneva over the next few days.  I’m not sure most adults are very excited about it but I’m sure many children are, with hopes of a snow day (or two) from school.  It will also presumably assure us of having a white Christmas so maybe in the big picture it won’t be such a bad thing. 

We are in the midst of what is traditionally a slower time for the real estate market with many prospective Buyers attention being diverted to the holidays.   It will be very interesting to see how things start out for the New Year and I know many real estate agents will be glad to tear off 2009 from the calendar and have high hopes and expectations for 2010.

I sense that some Buyers are beginning to come around to feeling as though the timing for making a purchase has improved but the fact is there is still a high level of concern and anxiety over jobs and the economic recovery.  I’m constantly hearing the term “these difficult times” that many advertisers and analysts are using these days and it has to have an effect on the way people think, even if things aren’t too bad for them.  Talk of a “W” recession that tries to make people believe that the current economic uptick is temporary and is going to be followed by another downturn is one of those self-fulfilling prophecies that I think we could all do just fine without.

I remain hopeful and optimistic about our real estate market and have every reason to believe that our area has the potential to outperform many of the other troubled markets and that we can be the exception to whatever negative outlooks and trends the “doom and gloomers” continue to talk about. 

November is turning out to be a very interesting month, we have certainly been blessed with some outstanding weather in Lake Geneva the last couple of weeks and especially this last weekend.  Although it did not seem to appreciably increase the amount of showings and activity on my listings, and most of the other agents I know, it surely makes it more conducive for prospective Buyers to still be thinking about looking at real estate.   I have remarked many times this year that I think 2009 will be remembered as a year that did not follow many of the “normal” trends and tendencies we would normally expect to see in our real estate market, including the summer that never happened and post Labor Day three weeks of summerlike temperatures.  Uncertainty over nationwide economic conditions, the whole healthcare debate and its effect on deficits and possible increased tax consequences have been front page issues on the minds of many.  Without a doubt, many of these circumstances have put a damper on peoples spending habits and their opinion of the future. 

On a more positive note, the slow but steady rise of the stock market remains a bright spot and I tend to want to buy into and believe those prognosticators who are predicting that the real estate market has bottomed out and that we are headed in the right direction for rebound in the coming months. 

I saw an article in USA Today yesterday that indicated home sales nationwide were up for October over 10% for the second month in a row and just read about a speech made last week by the Federal Reserve chairman Ben Bernanke where he used the words “Housing in the coming year is going to be a relative bright spot - a helpful driver of national economic growth, rather than the wet blanket it's been for the past couple of years”.  I have included links below to both articles.

We would “normally” expect the next month or so to be relatively quiet with many prospective Buyers attention being diverted because of the Holidays.

I hope you and your family have a wonderful Thanksgiving and for enjoying family and friends.

Usatoday.com Existing Home Sales October 2009

Realtytimes.com Real Estate Outlook          

We had two beautiful days last weekend in Lake Geneva for the beginning of November.  It will be interesting to see if the mild weather will continue and if it will have a positive impact on the amount of activity and sales as we head toward the end of the year.  In past years, we would “normally” expect our activity to slow between Thanksgiving and Christmas as potential Buyer’s attention gets diverted to the Holidays.  I’m not sure much of anything about the real estate market has or will continue to follow the norm this year, so an exception to that with a continued level of higher activity during that time period would be welcomed by all. 

A couple of interesting articles are linked below.  The first indicates that in a poll taken by Home.com, 5% of the respondents indicated they plan to make a real estate purchase this coming year, a possible indication that the perception is that prices have bottomed out and will be on the rise again in the future.

The second article discusses the extension of the $8,000 tax credit that was due to expire on November 30^th and details of the expansion of the program.

5% of Americans plan to buy a home next year

Tax Credit Program extended and Expanded

It was announced yesterday that existing-home sales bounced back strongly in September with first-time buyers driving much of the activity, marking five gains in the past six months, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – jumped 9.4 percent to a seasonally adjusted annual rate of 5.57 million units in September from a level of 5.09 million in August, and are 9.2 percent higher than the 5.10 million-unit pace in September 2008. Sales activity is at the highest level in over two years, since it hit 5.73 million in July 2007.

Lawrence Yun, NAR chief economist, said favorable conditions matched with a tax credit are boosting home sales. “Much of the momentum is from people responding to the first-time buyer tax credit, which is freeing many sellers to make a trade and buy another home,” he said. “We are hopeful the tax credit will be extended and possibly expanded to more buyers, at least through the middle of next year, because the rising sales momentum needs to continue for a few additional quarters until we reach a point of a self-sustaining recovery.”

Existing-home sales in the Midwest jumped 9.6 percent in September to a pace of 1.25 million and are 7.8 percent above a year ago. The median price in the Midwest was $147,600, which is 1.0 percent below September 2008.

There were two additional Lake Geneva lakefront sales reported to the Multiple Listing Service this week.  These are accepted offers at this point and the property's have not closed as of yet, but it is further encouraging news for the Lake Geneva lake front market and evidence that there continues to be a strong and high level of interest in affordable, well priced homes on the lake.  One of the homes is located on the North Shore of Lake Geneva in Lake Geneva in the Geneva Bay Estates subdivision and the other is located in Linn Township on the South Shore of the lake in the Trinke Estates subdivision.  Both were listed by agents in the Keefe Real Estate Lake Geneva office with asking prices under the $2,000,000 price range.

The inventory is up this year and at higher levels than we would normally expect to see, but many of those Sellers have adjusted their expectations with regard to price and there are definitely some exceptional values available right now. There is an easy way to search for property available on Lake Geneva, you can go to Search for Lake Geneva Lake Front Real Estate for a report showing the homes for sale on Lake Geneva as well as many of the other lakes in the area. 

Contact Bob Webster of Keefe Real Estate with any questions or for further informtion on the lakefront market in the Greater Geneva Lakes Area including Lake Geneva, Delavan Lake, Lauderdale Lake, Whitewater Lake, Lake Beulah, Powers Lake and Twin Lakes.

October is turning out to be an interesting month for activity in the real estate market.  Many markets are experiencing a continuation of strong activity in the lower end, entry level price ranges with the upcoming expiration of the $8,000 tax credit at the end of November.  You’ll probably hear news of a lot Buyers scrambling to get to closing by the deadline.  We’ve not seen a great deal of benefit from that particular program here in our market but anything that helps create sales and activity is a good thing.  Interestingly, I had 4 showings last weekend on a Lake Geneva lakefront listing of mine, which was really encouraging and is hopefully a sign that we’ll some second home business come together between now and the end of the year.  Also encouraging is the fact that the last two Lake Geneva listings that have come on the market in the last month have both received accepted offers on them in less than a week.  But one was listed at $1,200,000 and the other was listed at $1,595,000. We have not seen the same level of interest and activity in the higher price ranges on the lake but again it gives us some good news to be sharing with the numerous Buyers sitting on the fence waiting for a reason to take action now rather than waiting.  If we can luck out with some nice Indian Summer weather for the rest of the month, I think there’s a good chance I’ll be able to be sharing some more good news with you soon.

This year has presented us with some of the most difficult times in terms of trying to accurately get a handle on what’s happening in the real estate market and what direction the various parts of the market are headed.  We’ve had some exceptionally nice weather since Labor Day, probably more nice days than we did in the “summer” and there seems to be somewhat of an effect on certain parts of the real estate market.  The $8,000 First Time Buyer Tax Credit being offered by Uncle Sam has had a positive effect on the lower end entry level priced homes in many parts of the country.  That program has an expiration date, similar to the way the Cash for Clunkers program worked, coming up at the end of November with some Buyers now scrambling to get to closing.  In some areas of the country it has definitely worked and been responsible for an increase in Buyer activity and the sales numbers being reported.  The second home market in Lake Geneva continues to be soft, despite many Sellers adjusting asking prices down to the point where there are some very attractive values available to Buyers willing to ignore all the doom and gloom talk and step up and take action now. 

It just seems that many folks are being extremely cautious right now about making financial decisions and many are just not comfortable taking on additional debt in what the media seems to enjoy referring to as these “troubled economic times”.  I really dislike that term, because I think if people hear it enough over and over, it can become a self-fulfilling prophecy.  Despite this, I remain hopeful that some of the signs of increased levels of activity we have begun to see recently will continue and that the market will respond in a positive way to what I believe is a great time to be in the market for the long term.

 
I’m not giving up on 2009 as the Fall season can be a beautiful time in Lake Geneva with lots of visitors to the area.  I’m determined to make the most of the next couple of months to see if we can get some additional business done and end the year on a more positive note.

We are mid way through the month of September, isn’t it great that summer has finally arrived?  We had an exceptional run of nice days last week and the weather over the weekend was as nice a weekend as I can remember in a long time.  I had occasion to attend our statewide Wisconsin Realtor Convention last week and had an opportunity to brainstorm with a number of agents from across the state on the current market conditions.  Many areas, especially the in larger markets, are definitely seeing signs of the market picking up and much of that credit is being given to the $8,000 tax credit being offered to first time Buyers.  That program is due to expire at the end of November and there is some talk of a possible extension or expansion of the program in the works.  That would be good news for those of us in markets with higher price ranges, especially if the program is expanded to go beyond just first time Buyers.  The second home market here is the southern part of the state as well as the northern part of the state remains sluggish with lots of questions in terms of what it will take to give the second home Buyers the confidence to decide to move forward and take some action now.  With much concern about job losses, healthcare debates, talk of higher taxes and the possibility of increasing deficits, it makes the job of selling people on the idea of considering a second home purchase at this time increasingly difficult.   I’ve had several discussions the last couple of weeks with potential Buyers who think that they can come in with extremely low, unrealistic offers and that Sellers should be willing to give them serious consideration.  There was an article in the Chicago Tribune recently that I have been able to use with many of these types of Buyers that basically says Sellers in several of the resort markets are not giving their properties away and that Buyers need to keep this in mind when it comes to second homes.  There was a local real estate agent interviewed who has done very little second home business around the lake but in spite of that, he made some good points and the author of the article did not seem to try to change the basic message he and the agents from the other markets seemed to be making.   I’ve included a link to that article below.  I remain hopeful that this will be the year that the post Labor Day selling season will outperform the traditional summer season and that we’ll end the year on a high note. 

Chicago Tribune Article

Well we’re into August now and many people are still wondering when summer will arrive.  I heard on the radio this morning that it may be 95 degrees this weekend so maybe there is still hope that we’ll see some nice weather and the effect that it seems to have on bringing out the potential Buyers.  I’m encouraged that there have been some positive indications in the media that the market may be to the point of a possible turn around.  But before any of us get too excited, I think we need to remember these are just predictions and it will take some time for any of the positive forecasts to show up as actual results.  But at least there are some positive things being said. 

It is an ongoing, literally everyday struggle to work with Buyers today in this market who are anywhere from simply afraid or concerned about making a move to being downright negative and pessimistic about the real estate market, all as a result of everything they hear and read and have been told about these challenging times.  Our only response is to try to point out the favorable interest rates and some very attractive asking prices that have been adjusted by some Sellers in response to lengthy times on the market and the reduced number of sales taking place across the board. 

Some segments of the market have been extremely slow as far as activity and showings, in spite of our advertising and marketing efforts.  The only good thing is that both the showings and the lack of showings tend to run in spurts, so we often have the possibility of making up for lost ground in a short period of time.  We’ll continue to push forward and remain optimistic that the market will respond favorably to some of the recent news, and that we will be successful in finding a Buyer for your property in the very near future.  I’ve included links to some of the articles I mentioned for your review.

USATODAY Article on Pending Home Sales

USAToday Article on Manufacturing

CNNMoney Interview

USATODAY Article on Housing Rebound

USATODAY Article on Best July for the Dow in 20 years