Wednesday, July 1, 2015

Current Absorption Rates


Explanation of absorption rate: The rate at which available homes are sold in a specific real estate market during a given time period.  If you look at the number for New Haven you can say “If market conditions do not change and if no new listings come on the market it will take 5.0 months for the current inventory to sell at the current pace of the market.  A balanced market’s absorption rate is typically between 5 - 7 months.”



Wednesday, June 24, 2015

New Mortgage Regulations Put Off Until October

Perhaps in a rare admission that what they are about to do will cause havoc, the Federal government has announced that the new proposed regulations affecting real estate closings will be postponed from August til October.  As far as we can tell,  most closings will be harder to schedule and more likely to be delayed, since any change at all to the documents will require a three-day waiting period, each time something is altered.  This means, in all practicality, that there will be no back-to-back closings, where people sell one house and buy another.  That means no moving from the old home to the new in many cases--a major glitch for lots of families. 


What does the delay mean for you?  You have two more months to get into the pipeline for a mortgage under the old rules.  So hurry up!

Tuesday, June 9, 2015

School's Out

One of the truisms of the residential real estate industry has always been that homes are best listed in the early spring, to be sold in the late spring, closed in June and July, and moved into before school in September.  Especially in Connecticut, where the average age is high, and the birth rate is low, this pattern seems to be shifting.


 It was always true that condos, which typically had many fewer school-age children living in them, sold more often towards the end of the year.  That made sense, since the tax consequences were more important than the school calendar, particularly with lots of investors buying and selling them.  Now it appears that houses are also becoming less seasonal, and have more to do with jobs and second homes than with the school year. Part of that may involve the length of time it takes to sell, where people aim for summer and accept fall/winter, but I really think, looking over the past couple of years, that the sales pattern is evening out (except for snowy months) in general, regardless of days on the market.  There are also probably more retired people here, so that they are free to move at any time.


What does that mean for sellers?  It is still usually best to avoid peak holiday times (mid-December comes to mind) for listing, as well as the dog days of summer.  Otherwise, get it ready and price it correctly, and you are good to go.


And for buyers?  You doubtless have done enough on-line looking to know a good deal when you see one.  Don't expect it to last, if you find it, even in what you might think of as an "off" time.  Even if you buy first and sell later, supply is low for well-priced, well-maintained properties, and you shouldn't take choice for granted.



Wednesday, June 3, 2015

Current Absorption Rates


Explanation of absorption rate: The rate at which available homes are sold in a specific real estate market during a given time period.  If you look at the number for New Haven you can say “If market conditions do not change and if no new listings come on the market it will take 6.5 months for the current inventory to sell at the current pace of the market.  A balanced market’s absorption rate is typically between 5 - 7 months.”

Wednesday, May 27, 2015

Renting in Connecticut? Think again.

A new study has concluded that Connecticut is one of the most expensive states in which to rent, making it a place where people should definitely consider buying instead.  Our vacancy rate for rentals, particularly in New Haven, is one of the lowest in the country, and that, of course, pushes monthly rental costs up. Because our housing prices in general are 20% below where they were in 2006, there are some relative bargains still to be had on the buying front.  The combination of a rapid rise in monthly rents, combined with a still-depressed purchase market, means that renters should think before deciding not to buy.  And, if you combine those facts with current mortgage rates, they should think twice!


Although there are many articles that warn against buying unless you are going to stay put for several years, the combination of factors above would argue that that length of time might be shorter.  If you happen to get really lucky, appreciation on the home price could pay all of the moving costs and more.  There can definitely be valid reasons to rent instead, but everyone now should be doing the math before making up their minds.