It's the Best Time of the Year for Real Estate Buyers

 Every year, we post some version of the same message to buyers:  If you want to buy a house, the best time to make an offer--if you are serious and can move quickly--is between Halloween and Thanksgiving.  Sellers who really want to sell are beginning to come up against winter, and the end of the calendar and tax years.  They have begun to heat their homes, and sometimes plow their driveways.  There are fewer active buyers, and not all properties have as much curb appeal once leaves have fallen and flowers are gone.  

All of those factors taken together give buyers a last chance to buy in 2021.  The number of multiple offers have declined in most areas, yet mortgage rates are still attractive.  The choice of listings may be smaller, but more of them are actually going to be available for more than a day or two.  If house hunting has been discouraging this year, think about giving it another chance this fall.  

That means that you need to start now, at the beginning of October, so that you can be ready to go to contract in a month.  Buyers, make your lists, set your priorities, and make sure that you are prequalified.  Serious buyers are good buyers, and more likely to be decisive.  If you use that logic to your advantage, you may be spending the holidays in your new home!

Autumn Won't Slow This Market Down

 As I have written before, the strength of the market during this pandemic has surprised us.  Once we all figured out how to handle transactions in a time of COVID, real estate began to outperform most other industries.  That doesn't mean that it's business as usual, though--in fact, we are predicting that the fall will be better than normal.  

Why would that be?  First of all, the market took a pause in what is traditionally the busiest time of year.  This spring was slow, very slow, for a few weeks, and that pent-up demand has been spreading itself out over the remaining months of the year.  It's a seller's market now, which means that demand exceeds supply.  That translates into showings and offers for everything that comes on for sale.  Theoretically, it's easier to spur listings than to convince people who don't want to buy to purchase.  Sellers want to sell for all different reasons at all different times of the year.  They have often waited until spring, because they thought there would be more buyers then.  This year, the buyers have stuck around, waiting for product, so sellers can choose to list now, and sell in the fall, and eager buyers should snap those homes up.

The second factor would be the desire to find a perfect "nest" for a possible winter lockdown.  Especially for those working from home, the need to have a good place to park oneself has spurred looking at new places.  Given the demands on the construction industry, and the disinclination among some to have workers inside their homes, buying what you want and selling what you don't seems simpler. More time to browse the internet has increased interest at most levels of the market. And the net is wider--New Yorkers are now competing for houses here, with outside space and commuting potential.

Perhaps the most important reason for the surge is the current cost of financing.  For those with good enough credit to borrow, there may never be a better time to buy.  Mortgages have occasionally even dipped below 3%.  When I compare that to my first mortgage, a specially CT-subsidized offering at 17 and 3/4 percent, I rush to urge my kids to go get one!  Since they are now renters, I need to add that pool of prospective buyers to the current group, because it's now cheaper to own in our area than to rent, proportionately.  

What are you waiting for?  Call your agent today, and sell or buy post haste!

Mortgages, Real Estate, and Elections

Why has the market slowed down this fall?  The most obvious answer is that we often see a lull before elections, as people wait for a sign about the future of whatever district is voting that year.  We are seeing it now in Connecticut, where there is a heated battle for governor, with some real philosophical differences between the two candidates, about how to spur growth and recovery in our State. 


Another side effect of looming elections, however, is a good one for consumers, and we are also seeing that.  Mortgage rates tend to hit their lowest point in a year right before elections occur (surprise, surprise, if politicians have anything to do with it!), and that is true now.  Mortgage rates are currently at their lowest level since June of 2013, and it would be a very good idea for buyers to pay attention to that fact.  They almost always rise after elections, so there is a window here of a few weeks, when buyers may be able to qualify for rates that they won't see again.  If legislators are trying to put you in a good mood before you vote, why not take advantage of that fact, and get yourself a good mortgage while you're at it? And, since the market is in limbo waiting to see what happens, you can buy at a favorable price at the same time!

Sellers Take Note

Many people read the national news when it comes to real estate and forget that, like politics, all real estate is local.  In the past couple of years, most news has been about prices rising once again, and inventories running low across the country, especially (of course) in California.

We don't like to dwell on bad news, but our region was one of only six out of the top hundred metro markets around the nation whose average price fell from May 2013 to May 2014.  Three of the past few months have also seen declines.  I hate to bring it up, but sellers considering offers, or even listing price, should take those statistics into account.

There are multiple reasons for the fall in prices here, and some will certainly go away over time, but, for now, we are in stasis at a lower price point for most real estate, and we should accept that during the fall market that lasts until Thanksgiving.  Buyers will have choices, and it's fine to stick to your guns about price, unless you want to sell in the short run.  The spring market may be different, so buyers, who may expect that low selling prices and low mortgage rates will last forever, should act now.  Everybody will be better off if everyone is realistic.

News from the West Coast

I just returned from my biennial meeting of The Leadership Council.  This meeting was in San Francisco, and, although the weather is actually better here, I found it well worth attending, as always.  Around the country, brokers are feeling that the market is improving.  Since prices are still declining in some markets (including Connecticut), that doesn't mean that real estate brokers are in clover, but more units are selling, and faster.  Buyers seem less concerned that prices will drop a lot further, and they are moving on with their lives and finding homes.  Mortgages continue to be a challenge for many, and the effects of the Dodd Frank bill will continue to hurt that industry for years to come.

Some markets are a great deal better, and San Francisco is one of them.  There prices are rising, and units are flying off the shelf, despite a median price of over 1 million in the city itself.  Many homes are selling for more than the asking price, and often before the marketing has really gotten underway.  I was surprised that, for a place known as a high-tech mecca, the agents don't seem to use a lot more technology than we do. It still comes down to signs, open houses, broker to broker marketing, and word of mouth.  The one real change is that the internet has largely replaced print advertising, although there is still some of that.

Two interesting side notes:  I was the only person there without an iPad, which tells you something about why Apple alone is raising the NASDAQ results; and, two, this group, of owners from around the country, plan to vote for Romney over Obama by two to one.  The real news there is that they went for Bush over Gore by 18 to 4, so you can see that the election will be close!

Back to School, Back to Work

I've been out of school for a very long time now, and I don't even have kids in school anymore.  Still, to me Labor Day seems like the beginning of the year, every time it rolls around.  And I don't think I'm alone, because we can certainly notice it here in the office.  One agent just said to me that he'd been spinning his wheels all of August, waiting for people to get back to work and also to their real estate issues.  This year, even the weather made us want to get out of the swimming pool and back to our desks.

What does that mean for sellers and buyers?  There is a noticeable uptick in the market from Labor Day through Halloween, and it's a window you should use to your advantage.  If you trying to sell, this is when you need to get real about the price, the condition, and the cost of waiting versus selling now.  If you are buying, you may find more product out there to choose from, and you may find it easier to make a deal, particularly if you are buying for cash.  Whichever camp you're in, don't let the season pass you by.  Get out there and let the cooler weather spur you on to action!