Real Estate Information

I Love Real Estate

By Eric Bushnell, Associate Broker – REALTOR, C.N.H.S.

Lee Realty, LLC

 Do you like, love, or hate the real estate market?  I love Real Estate!  Not everyone has this opinion, but everyone has an opinion about real estate.  The topic of Real Estate is a great conversation starter no matter where you are.  Consider this:  the American dream is to own a home, and buying a home is most likely the biggest purchase that you will make in your life.  The Real Estate market effects our lives in many ways. During the 2016 election polls showed 73 percent of Americans feel that housing affordability is one of the most important issues facing our nation.  So, it’s obviously going to be part of our conversation.

Real Estate is a popular topic, let me share with you a question I’m asked each week.  “Is now a good time to sell my home?  Maybe???”  Yes, that answer seems ambiguous, until you look at several factors.  Are you moving? Do you want to down size?  Do you need a bigger home?  Would you like to live in a different neighborhood?  Every person has a different reason as to why they need to buy or sell a home.  The worst one is because you have too, and there can be several reasons that you force you to sell, but we will not go into that here.  Your reason to sell, move, downsize, or upsize is a personal reason that is being caused by economic or social factors in your life.  Good advice here is to be sure this is what you need to do.  Is your reason to move based on specific needs, or an impulse?  Impulse decisions can be very expensive.

So whatever your reason is for moving, the next question is -”What will the real estate market be like this next year?” “Is it a good time to sell?”  “Is it a good time to buy?”  I get asked these questions all the time, and here’s a quick answer.  Springtime brings the highest prices of the year.  Mid-summer is when there is the best selection of homes to choose from.  Late summer and fall is when you start to see prices lowering as homeowners try to seller their home before winter, so you may get the largest discount against their original asking price (they may have overpriced the home, thus the big discount). Homes are sold during all twelve months of the year; however a majority are sold between May-August.  The home that is clean and has minimal deferred maintenance typically sells faster than any other home on the market.  People do not want to buy a money pit.  So, clean your home and make it shine like you’re having a dinner party for your companies CEO.  When buying you want the best looking house on the street, curb appeal is very important.

So back to the next question, “What is the Real Estate market going to do in 2017?” That will depend on how people feel about the local economy.  We know that the national economy is getting better, but is our local economy going to follow suit?  Fear can strangle the local real estate market, by slowing people down in making the decision to purchase.  If there’s less buyers looking, then potential sellers may not put their home on the market (in hopes of buying a different home).  The market begins to slow down.  People are motivated by fear of loss or hope for gain.  Now you see why I earlier answered “Maybe, it’s a good time to sell or buy a home”. The Real Estate market is based on everyone’s perception of the future. 

So, here’s my forecast:  The Real Estate market will be good as long as you’re buying or selling for the right reason!

In January 2014 I wrote a blog on 2012 with a forecast for 2014.  Here is how it started:

"Turbulence on the horizon…

Today is January 18th, 2013, what will 2013 bring? Many people are saying that 2013 will be a great year. I believe that we will good times and slow times in the coming year. 2012 saw growth in the number of homes sold in the Anchorage and Eagle River markets. The Mat-Su Valley was closer to flat, with gains in some areas and losses in other. Most will agree that the average home value increased between 1.5-3.5%...” for the whole article click here!

2014 started out pretty slow and then gained speed through the summer months; however the total number of homes sold in the Anchorage and Eagle River markets appears to be lower than 2012.  The Mat-Su Valley, Palmer and Wasilla, saw an increase in sales by approximately 18% through the first three quarters of the year.  Still waiting to see the final numbers to see if this sales trend was able to sustain the pace.  New construction in Anchorage and Eagle River was down this year as less homes were built.

2015

So let’s start with new construction.  There will be less building sites available this year, and building prices will be higher.  Keeping this in mind, it is safe to say that there will be fewer choices to be had within the Anchorage bowl.  In the Mat-Su I anticipate new home sales to be about the same as 2014.  The valley will continue to be a bargain compared to Anchorage; newer homes and in most cases more affordable.  Land is less expensive in the valley.  Average cost per acre is about $55,000 and in Anchorage the average .25 acre lot is $140,000 or more.  The valley is home to more contractors.  This naturally leads to more competition than in Anchorage, and competition leads to lower prices.  The bargain will be in the valley in 2015.

Existing home sales will most likely remain fairly stable in the Anchorage market, and we should see a minor increase in prices.  Interest rates remain low which allows home prices to raise.  If we see an increase in interest rates we may see an eventual drop in existing home prices.  New homes will remain higher.  The valley is expecting growth this year similar to last year’s numbers.  Why?

Low gasoline prices fuel development in the Valley.  It's that simple.  There is more to this equation.  Business owners look to the valley for their workers.  If you're going to start a business this year the Mat-Su Valley is the place to do it.  There are more available workers, and according to the State of Alaska, the workers are more dependable.  There is talent available in the valley.

2015 is set to be a good year.  Yes, there is the head winds of a new governor, and the low oil prices.  These factors are also key contributors to the growth of the valley.  The Mat-su School district is more nimble than its Anchorage counterpart.  Their also our biggest employer, with growth comes more children.  This adds more schools and more jobs.  

There is also one other piece to the puzzle, TAXES!  Many Mat-Su communities already have taxes in place and pay their way.  Anchorage will feel some pain in this area, as much of the Municipality's income comes from the State of Alaska.  With lower oil prices there will be budget issues.  The Mat-Su borough should be able to deal with these budget shortfalls better than the Municipality of Anchorage.  

Now is a great time to invest in rental properties.  National home ownership rates are about 62%.  That means that 38% of your neighbors are potential renters.  Not everyone wants to own a home.  Some people would prefer that you take care of the home.  When there is economic uncertainty people don't take risks. Now is the time to take advantage of low interest rates, and high rental rates.

If you would like more information about the real estate market you can call me at 907-360-7471.  I would also be available to speak to any group that would like a speaker on this topic.

Happy New Year, see you in 2015!

I was looking for a pack raft online, so that my son and I can do some fly in float trips as he gets older.  I ran across this video of a couple of pack rafters on the South Fork of Eagle River.

Spring Cleaning is here. Spring is here and the snow is finally on its way out. Now is the time to check your properties for winter damage and get them ready for the Spring selling season. Here is a list of quick Spring cleaning to do to get your properties in tip-top shape:

• Take a look at the roof – Roofs take a beating during the heavy rain, snow and ice of winter. Check the roof to look for any loose, buckling, cracking or missing shingles and get them replaced right away. Taking care of these now could avoid costly roof repairs later on down the road.
• Check the plumbing – Make sure no pipes are leaking or were damaged during the winter season. Check faucets to make sure they aren’t dripping and check around pipes for any signs of dampness or previous leaks that could indicate water damage. Don’t forget to also check outside faucets for damage.
• Get the fireplace cleaned and inspect the outside of the chimney for any winter damage.
• Get debris out of your gutters.  Clean out all the leaves and make sure the gutters are clear and able to flow cleanly.
• Clean and repair screens.  You want those windows to look nice when your clients are doing walk throughs and checking out the great views around the house.
• Touch up cracked and peeling paint. Doing touch ups is fairly inexpensive and can go a long way in making a property look more appealing.
• Rake up dead leaves and mow the lawn. We all know how important curb appeal is when attracting clients so make sure the yard is tidy.

Would you like to see all the new listings in Eagle River? Click here http://www.leerealtyalaska.com/New-Listings-in-Eagle-River-AK

Would you like to see all the new listings in the Mat-su Valley?  Click here http://www.leerealtyalaska.com/New-Listings-in-Wasilla-Alaska

There seems to be more activity in the market right now.  I've noticed that there are more people visiting my website.  Homes are getting more showings.  And three homes I had listed are now under contract.  these sellers are very happy they listed their homes now before the busy summer months.

I'll be out this afternoon visiting with one seller and then showing a couple a home in Wasilla, they're considering purchasing.  There is optimism in the air.  Even Wall Street had a good day, stock market closed in positive territory today.

There is currently 94 homes available for sale in Eagle River; however 22 of those homes are under construction and not ready to move into at the moment.  That leaves 72 options.  Last February 26 homes sold, and then in March 80 homes came on the market, and in April/May 184 homes came on the market.  103 of those homes sold, but that a lot of competition. 

My advice is get started now.  You will most likely get the price you want for your home, if its clean and ready to sell.  Homes that don't shine will be sitting on the market in September.

Be ready, call me today for a free consultation.

Daily Real Estate News | Friday, January 24, 2014 The housing market has been experiencing a “healthy recovery” over the past two years, with home sales last year rising to the highest level since 2006, according to the National Association of REALTORS®' latest housing report. “Existing-home sales have risen nearly 20 percent since 2011, with job growth, record low mortgage interest rates, and a large pent-up demand driving the market,” says Lawrence Yun, NAR’s chief economist. “We lost some momentum toward the end of 2013 from disappointing job growth and limited inventory, but we ended with a year that was close to normal given the size of our population.”Existing-home sales rose 1 percent in December 2013 compared to November and reached a seasonally adjusted annual rate of 4.87 million.Existing-home sales for all of 2013 reached 5.02 million sales, 9.1 percent higher than 2012, and the largest rise since 2006 when sales were at 6.48 million at the close of the housing boom, NAR reports.  Home prices were also on the rise in 2013, up 11.5 percent over 2012, with a median existing-home price of $197,100 last year compared to $176,800 in 2012. It was the strongest gain in home prices in a year since 2005, when home prices rose 12.4 percent, NAR reports.NAR President Steve Brown says that with job growth expected this year, home sales should hold despite rising home prices and higher mortgage rates.“The only factors holding us back from a stronger recovery are the ongoing issues of restrictive mortgage credit and constrained inventory,” Brown says. “With strict new mortgage rules in place, we will be monitoring the lending environment to ensure that financially qualified buyers can access the credit they need to purchase a home.”Housing Recovery Regional SnapshotHere’s a look at how existing-home sales fared in December and for the year across the country:Northeast: Existing-home sales fell 1.5 percent in December but remain 3.2 percent higher than December 2012. Median price: $239,300, up 3.6 percent from year ago levelsMidwest: Existing-home sales dropped 4.3 percent in December and are 0.9 percent below year ago levels. Median price: $150,700, 7 percent higher than December 2012.South: Existing-home sales rose 3 percent in December and are 4.6 percent higher than December 2012. Median price: $173,200, up 8.9 percent from a year ago.West: Existing-home sales increased 4.8 percent, but are 10.7 percent below a year ago. Median price: $285,000, up 16.0 percent from December 2012.By REALTOR® Magazine Daily News

Current inventory here in South Central Alaska is at the lowest point I've seen in my ten years of real estate.  In any given price point the select is very slim for buyer.  I remember when I moved back to Alaska in 1999, I encountered a similar market.  I was only able to look at a dozen homes that fit my criteria and budget.  I looked from South Anchorage to Chugiak to finally find a home.

This creates certain market dynamics that would lead a seller to believe they can get whatever they want for their home.  This is somewhat true, but they should be cautious.  Buyers can only afford so much, and interest rates are rising; a full point over last year.  This takes $30,000 out of a buyers buying power at the $300,000 range.

So is the market going to go up in value, but down in the number of homes sold? Yes, that is what is going to happen for some home owners selling.  Many will try to raise their asking price too high. The smart seller will price their home approximately $10,000 below their immediate competition.  This makes their home look very attractive to prospective buyers, and usually results in a quicker sale.  the seller that does not do this, has their home sit on the market as new smart home owners come on the market just below them.  These home usually attract the buyers currently in the market, and sell rather quickly as well.

My advice is not to get greedy.  It's better to sell quickly at a lower price then hold out for that buyer that will pay your price.  If you can find them.

Turbulence on the horizon…

Today is January 18th, 2013, what will 2013 bring? Many people are saying that 2013 will be a great year. I believe that we will good times and slow times in the coming year. 2012 saw growth in the number of homes sold in the Anchorage and Eagle River markets. The Mat-Su Valley was closer to flat, with gains in some areas and losses in other. Most will agree that the average home value increased between 1.5-3.5%.

At a recent Chugiak/Eagle River Chamber of Commerce luncheon, Mark Edwards, Economist for Northrim Bank spoke on the economy. Tax reform and government spending are issues here in Alaska as well as Washington DC. He also explained that many new businesses are started with funding taken from the equity one has in their home. So if values are increasing, we may see more new businesses that will lead to job creation.

As we move through the year I believe inflation and interest rates will drive the ebb and flows of the housing market. Currently here in Alaska we have limited supply of homes on the market. Unless values increase 5-6% many home owner may not be able to sell their homes without taking a small loss. So for the first half of 2013 I believe the new construction market will do well. As prices rise in 2013 more homes should come on the market, leading to a saturation point in the 3^rd Quarter.

If interest rates rise, buyers will have less buying power. If inflation occurs in any significant amount then new home prices will also rise above the reach of many buyers. Looking at all this information it is my opinion, and let me emphasis this, my opinion, the market will see good growth in value of homes below $350,000. However buyers in this range will get less for the amount they spend as the year progresses. The best deals will be in the spring.

Higher end homes with smart owners will bring their homes to the market slightly below the retail value and sell quickly, while those trying to take advantage of rising prices that attempt to sell for full retail will sit on the market. If interest rates rise, we will see downward pressure on the higher priced homes.

So fasten your seatbelts. Get your home ready to put on the market before the federal government starts messing with interest rates and taxes. I can create a market evaluation for your home and give you advice on when would be the best time to sell your home.

Call me at 907-360-7471 or click this link Market Analysis.

Today is the last day that all will be normal...or is it?  Tomorrow according to the Mayan calendar is the end of the world.  So now is a great time to reflect on the good that has transpired in 2012.

Real Estate has done well this year here in South Central Alaska.  The Anchorage market had one of its best years in recent history.  I Eagle River we're on tract to sell approximately 12% more homes this year than last.  The Valley market started the year well, but has gas prices rose homes sales declined.  No with the price gas back down in $3.50's or below, we are seeing more traffic to Valley homes.  Land sales in 2012 were very good in all markets, and we have seen 20% of the Powder Ridge Phases sell already.

The weather has not been a positive point in 2012.  Last winter was very snowy, so if you like to ski and snow machine it was excellent.  The summer was cold, and this fall snow had been non-existent until recently.  It's been cold, definitely colder than normal.  Yesterday morning it was -26 at my home in Wasilla.  Today its warmer but we have 30 mph+ winds, wind chill in the -30's.

On a personal note, I stepped away from management and it has been perfect for me.  I've been able to concentrate on more real estate.  I've had time to be with my family.  My daughter came back from a year in Bolivia, where she was an exchange student.  She had a great time, but its good to have her back.  I had time to work with our local Eagle River Area Rotary club to build the Let's all Play playground here.  This was the first full accessible playground in the state, so that kids of all abilities could play together.

This fall I've had more time to  spend coaching hockey which I love.  I'm coaching two teams, Mini Mites (4-6) and Suirts (9-10).  We have agreat time and I am getting in better shape.  Three days a week at the gym is helping as well. 

2012 was a good year.  I made decisions and moved forward with my long term plans.  I was able to work with the chamber of Commerce, Eagle River Area Rotary, Sunrise Rotary, Mat-Su Amatuer Hockey Association, my family, the gym, and was able to go hunting this fall.  Yes, I did get a moose and my freezer is full.  Life has been good this year.

How was your 2012?  I hope the world doesn't end tomorrow, because I've go more on my bucket list to do.