Snow and Real Estate Sales

Snow is not good for real estate sales.  I taught my children at a young age to moderate their excitement on school snow days, telling them that snow causes people to cancel their showing appointments.  Buyers don't want to go out and drive around in bad weather, and sellers don't want to worry about shoveling and dirty boots tracking through their clean houses. 

But real estate isn't an impulse purchase, right?  It's hardly in the category of the candy by the checkout counter, or even the perfect dress in a shop window. Therefore, people who don't look and buy one day should do so the next, or the next week or month. 

Well, they probably do.  Unfortunately for us, we track sales  year to year by the week and the month.  When we look back, we don't always remember the weather at the same moment the year before.  Perhaps, however, this year will be different.  This weekend marks the first anniversary of the Blizzard of '13. That storm impacted sales for weeks, so much so that the whole month of February 2013 was horrendous for us.  That loss followed us for the whole year, for good and for ill.  We popped later in the spring, the spring market lasted well into the summer, and the summer lag started in late August. 

So what will 2014 bring?  So far, a lot of ice and snow!

Snowing Again

It's snowing tonight in Guilford, and it seems to have been snowing quite a lot lately. When our kids were little, they used to get excited by snow, and hope for a day off from school. The phone would ring, and I would tell them that it was the sound of people cancelling their real estate appointments. No school, no showings. Although that was a decade ago, things haven't changed. When the weather is bad enough, no one looks at real estate.

We're lucky that we aren't in a business where a day like today means that those sales can never be made up at another time. If a plane takes off with empty seats, or a theater has no patrons, that's money down the drain. At least most people looking for property will look again on a nicer day. Generally, it's not an impulse purchase, or a date-specific one.

There are also the issues of showings and open houses. Unless everything is perfectly plowed, it can be tricky to have buyers coming in on icy sidewalks. It's often hard to park with snow piled on the sides of streets. And few places look their best with wintry boots and shoes tracking the outside slush onto rugs and floors.

I wonder if the Internet has changed all this for us. When you're home due to cancellations, as I am this evening, do you go online and shop for your dream home? Or a vacation place? Or the new location your business needs? We hope so!

It's the Buying Time of Year Again

Our agents have heard me say this every year, but it's time to say it for this blog: The best time to buy a house is between Halloween and Thanksgiving. Sellers are ready to sell, as they start to pay heating bills, think about plowing, and head into the holidays. Buyers are mostly settled into new homes or forgetting about buying until spring. It's hard to show houses in the winter. There's snow and ice, not to mention cold. Parking and driveways can make open houses and showings tricky. Although many homes show well when they are decorated for the holidays, most families are busy at that time of year and don't want to have to keep their homes clutter-free and ready to show. Most buildings look better in light, and there isn't much of it in the dead of winter. All of that adds up to the realization that, if you haven't sold your home within the next three weeks, you probably aren't going to sell it until the spring.

Despite that chilling thought, there are sellers who want to move at this time of year. For one thing, some have tax reasons for wishing to close before year end. Some have jobs or commitments in other places. Some are tired of the selling process, and some have another home waiting for them. Some just want to spend the winter in a warmer place. All of those people are competing for the buyers still looking when winter comes. Therefore, if you are an eager seller, you are most likely to compromise on the price at this time of year.

Buyers can capitalize on these factors to negotiate for a better price as the weather gets cold, especially if the home is empty and sellers are worried about freezing pipes and empty oil tanks, or even just heating and plowing bills. This is the time of year when a month of expenses can easily become six months of expenses, and sellers will take that into account.

If you are a buyer, particularly a buyer with cash, here's your chance! Don't waste it--buy now.

Connecticut Commercial Real Estate Now

We had an interesting Commercial Department meeting this morning. One of the agents said that the selection of good commercial properties in our area is the best that it's been in a long time. Well-located, well-priced buildings are now on the market, for buyers who can come up with the financing. Based on what else we are hearing, that may mean that they have to have cash! Even that is not a total bar, as there are many investors around who do have access to cash or capital from others. While some may suggest that it's best to wait until prices fall further, I'm not sure that we know enough about the stimulus plan to know when that will be (or even if it's now!).

Well, it's snowing AGAIN. Since no one buys real estate in the snow, my only question for the rest of the day is whether yoga will be held. Yoga is one of the arrows in a real estate broker's quiver these days--whatever calms you down is good.

Back to the Cold

Today is my first day back from vacation. I just finished going through my 600 emails and dozen papers, and tomorrow I will start writing articles that I've promised to people. Like a lot of people, I hope that the new President and his administration will bring a new beginning for our industry and others. The government is certainly pumping money into the economy--it just has to find its way down to the real estate market. And, in the Northeast, the weather isn't helping! Every day seems to bring snow, ice, or freezing temperatures. We know from other years that people don't look at property under those conditions. We also know that it can lead to a nice pop as the spring market blooms (pun intended), and never before have we needed that so much.

Vacation post

Just a quick update from Scottsdale. It feels mean to say that it's 77 degrees and sunny here every day, when there is so much cold and snow in Connecticut! But everybody needs a break, and this is mine. I run a lot, read a lot, and just generally chill out. We've played golf, shopped, and fiddled around.

Phoenix has been very badly hit by the economic downturn, and it shows how lucky we are in our region not to have the tremendous overbuilding that exists here. There are shopping centers and restaurants on every corner; it's hard to imagine where all the business can come from to keep them afloat. They've had phenomenal job growth here as well, but now they're just ahead of Detroit in new job growth, so the party's over. Our education and health care-based economy looks pretty good in comparison.

OK, Enough Snow!

Well, we were waiting for the snow and we got it! Once the snow started on Friday, it came down so fast that going home was an adventure. I tried to dig out the car closest to the bottom of the driveway so I could go to yoga on Saturday morning, but couldn't do it. Saturday night, all four of us took that bottom car to a party in Norwalk, and ended up pushing it off the driveway at midnight that night. Sunday was another day when none of us went anywhere; there is a downside to living in the highest-up house on Long Island Sound in Connecticut! We're 85 feet above sea level, and the water is right at the bottom of our driveway. If we miss the road by much, we're toast. Our plowing company had gone out of business since last winter, but hadn't bothered to tell us, so a BIG thank you to George Sanders of West Lake Landscaping, who saved the day (or night) by plowing us out on Saturday night. In the interim, we missed a couple of parties, but no days of work. Nature becomes much more important when you live so close to the water. When it's not snow or ice, it's flooding on Old Quarry Road or Route 146.

All that ice means that I haven't been running, either. I can't wait to get out there again! I'm just too clumsy to take the risk of falling. All those Christmas cookies and no exercise is not a good combination, though.

Our New York Times did come on all those days, however, and I got to read about Carl Icahn's suit against Realogy. Realogy is the parent corporation of Coldwell Banker, C21, Sotheby's, ERA, and CB Commercial. They have a LOT of debt, and they were trying to restructure by replacing the debt people already held with less debt of a higher caliber. Carl Icahn didn't like that, and the court agreed with him. It may be tough to be an independent company in this market, but at least we don't have billions of dollars of debt. Now they're looking for another way to restructure. Maybe they'll start by spending only what they have to spend--there's a novel idea!

A snowy weekend

I'm sitting in my office waiting for the snow to begin. The first big snow of the season always leads to cancellations and traffic, but little real estate activity. Most of our activity this week has been in the form of office parties. Spirits have been surprisingly good, although maybe it's due to the spirits consumed! We've had many toasts to a better 2009.

What I am seeing, however, is that those listings that our offices collectively think are "well priced" have been selling. From one meeting to the next, more than half of those will have gone under contract. That's very surprising, considering that it seems as though nothing is selling. I guess that's because we're only talking about 5 percent or so of all the properties we have listed. I put quotation marks around well priced because it's so hard to know what that means now. Even if a seller took our advice when he or she listed it, it's probably lower now. Past sales are very little indication of what will happen today, and buyers are only signing if they perceive that they're getting a bargain. Believe it or not, there are still some multiple bid situations when that is the case. The internet provides so much information, and most buyers look at so many properties, that they know right away if they need to move quickly to lock something in before it sells to someone else. What does this mean for sellers? Your property must stand out in a sea of listings, and price is the most important factor for all but a very few.