Friday, January 31, 2014


The PTC Index, from Pioneer Title


Building Permits201
New Home Sales175
Existing Home Sales609
Average Sales Price198326.5
Financial-Bond Market(10-yr Treasury)2.9
Days on Market66
Distressed(Short Sales and REO)1217
Notices of Default175
PTC Index169

2013 has come and gone and wasn’t without its ups and downs. Refinance volume dropped significantly, while the average Treasure Valley sales price made steady gains throughout the year. Building permits for the month of December where down slightly from the month prior by 11 percent, up 18% from a year ago. Interestingly, new home sales increased by 18 percent over November, and were up nearly 28 percent from December 2012. Existing home sales inched up by 10 percent from a year ago, and held relatively steady with November 2012 falling only 3.6 percent. After several months of decline, refis inched up slight by 1.3 percent in December, but down nearly 60 percent from a year ago. Average sales price remained steady to settle at just under $200,000, up 19 percent in the year-ago time period. Distressed properties continued to decline down 6.5 percent from the month prior. Notices of default, however, or up in both the year-ago and month prior time frames but nearly 16 percent.


January of 2010 had PTC Index of 28

A year ago, December of 2012  Index of 224

Last month reflected PTC Index of 172

Thursday, January 30, 2014

6 Things Sellers Need to Hear BEFORE Listing.


January 27th, 2014

Edited by Roger Lowe

In a market where home inventory is low and demand is soaring,  sellers may think that their home will move in mere minutes–and at a price that defies even the loftiest expectations. When left untethered, these dreams of big prices and warp speed sales can spell disaster–and major disappointment.

Consider these 6 Items.

1. Staging matters–big time!

Every agent knows the old adage, “Homes that don’t show well don’t close well.” But still, time and time again we see sellers rail against the time and cost associated with staging a home. Afterall, if they love their home as it is, why shouldn’t everyone else? Their decor may be a beautiful expression of their personality, but sometimes less is more.

2. The market sets the price, not the owner.

It’s understandable that many home sellers think that their home is above the price that the market dictates. Sentimental value often translates into an inflated sense of the home’s worth,  but when it comes price, the winning opinion is always the market’s opinion.

3. Small repairs may mean big bucks later

In many cases, the cost of a home repair is less expensive than a potential buyer perceives the cost of the repair to be. If buyers over estimate the cost of fixing the problem, it may negatively impact the offer amount and end up costing the seller more in the long run.

4. Incentives can help close the deal faster.

Offering practical incentives might not sound sexy, but those that fill legitimate buyer needs have the power to differentiate a listing from the competition and attract just the right attention needed to get the home sold for the right price.

Sellers  might be prepared to sweeten the deal if the right offers don’t come rolling in. Talking incentives early and building them into the marketing plan can arm both agent and seller with the ammunition to jump potential marketing hurdles and beat out the competition for a fast sale.

5. Serious buyers never stop the hunt.

Too many sellers see the winter months as the slow season. The reality is, there are plenty of upsides to listing and marketing a home when everyone else is taking a break. Even in this cold inversion, buyers are still looking for just the right house!

6. Real estate is a local business.

The last few years have turned real estate headlines into high-profile news. Home prices are on the rise. In fact, last month home prices were up 11.9% over the year past. While this is great news for the country as a whole, be sure to remember that real estate is a local industry and that asking price isn’t everything.

Check for  local market updates regularly on this blog. or just give me a call to talk.


Tuesday, January 28, 2014

It's the PRICE that sells a Home!

The following article was written by Blanch Evans in Realty Times. It rings very true.

You've heard the old saying - "Location, location, location."

The real truth is "Location, condition, and price." And price trumps every other factor.

Location affects the value of a home, but it's price that sells a home.

Oceanfront, mountainside, or penthouse, the most desirable location in the world won't sell at the wrong price.

Every property has a potential buyer, but like rock, paper, scissors, it's sometimes hard to know which factor is going to win the showdown.

A good location will sell at a fair price. A bad location will sell at a fair price, too. It just won't be as a high as it would be for a good location.

A home in good condition will sell for a fair price. A home in poor condition will also sell at a fair price. Again, it won't be as high as a comparable home in better condition.

But neither location or condition will sell any house. Only one thing does that - price.

So if you're a seller waiting for that "special buyer" who will appreciate your faded pink and black bathroom tile, your vintage orange shag carpet and is willing to help you put your kids through college because of your real estate prowess, you're going to have a long wait.

So if your home is represented by an agent, and it's been on the market for a long time, chances are it's your own fault.

Maybe you didn't listen to your agent when he said you're pricing your home above the market. Maybe you got mad at the first few folks who looked at your home and didn't make offers.

When the showings stopped completely, maybe you accused your agent of not doing a good enough job.

You put the blame on everyone except where it belongs - on you. It's not about you, what you want, or how much you need for your retirement.

It's about the price.


Sunday, January 26, 2014

Cost of Waiting

A couple of days ago I posted 3 questions every buyer should ask themselves. It spoke of where home prices and interest rates are projected to be heading. Rather than keep waiting and having cost you more, give me a call so we can find that house for you!

The chart below illustrates the cost of waiting!

Saturday, January 25, 2014

Agents: WHITE Lies and LYING

I just read this article from KCM Blog and it really rings true. A great agent will tell you the truth even if it is not what you want to hear. Because it is what you need to hear. A personal example, I was called out to list a home the thad been on the market with another agent for a few months. After preparing the CMA it was very clear the home was very over priced. It was hard to tell the owner, it harder for him to hear. In asking the owner how the original price was selected he told me the agent just asked him what he wanted for the house and that is what they went with. That did not do anyone any good.

We priced the home properly, I secured a buyer, but the question from her thatI had to overcome was: " I heard at church that this home had been on the market a very long time, is there something wrong the home that I am not seeing?"

I have not taken listings when sellers are not being reasonable, I want the most for my sellers as well, but pretending a property is worth more than the market will support only hurts the seller. Sometimes I feel that I need to duck when I tell the truth, but I am glad and eventually my sellers are glad I do!

The article follows.

1.22 VisualGrowing up it seemed ‘white lies’ were okay while lying was a sin. As children, we sometimes had difficulty understanding where the line was. As we matured, we realized there most definitely was a difference.

If a husband or wife asks if it is okay to invite their parents over for dinner, the spouse would probably say ‘sure’ even if it wasn’t 100% the truth. That was a ‘white lie’. If a young boy dresses up as a monster on Halloween and asks his father if he looks ‘really scary’, it was okay for his dad to say ‘YES’! That was a ‘white lie’.

In both cases, the person telling the ‘white lie’ was saying what the other person wanted to hear. In both cases, there was no harm in not telling the 100% truth. In both cases, it was a ‘white lie’. However, if we are not telling the 100% truth in order to save someone’s feelings AND IT HURTS THEM, we are lying.

What does this have to do with real estate?

We believe there are some in the real estate industry more worried about a homeowner’s feelings than they are about telling the truth about the current value of their home. These agents are not necessarily malicious. They just realize they may disappoint a seller at a listing appointment by telling the truth about what the house will sell for. They find it difficult to deliver tough news. To make sellers feel better, they lie.

Good agents can deliver good news. Great agents know how to deliver tough news.

In today’s real estate market, you need an agent that will tell you the truth, even when you don’t want to hear it. You need an agent more worried about your family than they are about your feelings. You need an agent who can get the house sold!

What this means to you

If you are interviewing potential listing agents, demand they tell you the truth. Don’t hire the agent that tells you what you want to hear. Hire the agent that tells you what you need to know. Reward their honesty.


Friday, January 24, 2014

Three Questions a Buyer Should Ask

1.20 VisualIf you are thinking about purchasing a home right now, you are surely getting a lot of advice. Though your friends and family have your best interests at heart, they may not be fully aware of your needs and what is currently happening in real estate. Let’s look at whether or not now is actually a good time for you to buy a home.

There are three questions you should ask before purchasing in today’s market:

1. Why am I buying a home in the first place?

This truly is the most important question to answer. Forget the finances for a minute. Why did you even begin to consider purchasing a home? For most, the reason has nothing to do with finances. A study by the Joint Center for Housing Studies at Harvard University reveals that the four major reasons people buy a home have nothing to do with money:

  • A good place to raise children and for them to get a good education

  • A place where you and your family feel safe

  • More space for you and your family

  • Control of the space

What non-financial benefits will you and your family derive from owning a home? The answer to that question should be the biggest reason you decide to purchase or not.

2. Where are home values headed?

When looking at future housing values, we like the Home Price Expectation Survey. Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

Here is what the experts projected in the latest survey:

  • Home values will appreciate by 4.3% in 2014.

  • The cumulative appreciation will be 28% by 2018.

  • Even the experts making up the most bearish quartile of the survey still are projecting a cumulative appreciation of over 16.8% by 2018.

3. Where are mortgage interest rates headed?

A buyer must be concerned about more than just prices. The ‘long term cost’ of a home can be dramatically impacted by an increase in mortgage rates.

The Mortgage Bankers Association (MBA), the National Association of RealtorsFannie Mae and Freddie Mac have all projected that mortgage interest rates will increase by approximately one full percentage over the next twelve months.

Bottom Line

Only you and your family can know for certain the right time to purchase a home. Answering these questions will help you make that decision.


Thursday, January 23, 2014

Ada-Canyon 4th Qtr Rental Vacancy Rates

Vacancy rates moved upward .7% above last quarter. Comparing winter to winter, the surveyed vacancy rate rose from 3.4% for Q4 of 2012 to 3.9% for Q4 of 2013 with a recent surge in single-family vacancies for the quarter.

Rental rates were also pressured for the last quarter, but realized healthy annual growth. Winter rate fluctuations are historically expected to be the result of increased competition attempting to avoid vacancy and turnover time in the coldest weather of the year when renter demand is lowest. Multi-family rates were relatively stable with some segments slightly up and some slightly down within the statistical variability of the survey. Most of the downward rental rate movement for the quarter was in the single-family market. Year-over-year, average rents increased by 7.6%!

Courtesy of Park Place Property Management, For full report click here


Wednesday, January 22, 2014

Mortgage Application Volume Starts Out the Year with Increased Activity

In the last two weeks of 2013, mortgage application volume steadily declined. However, since the beginning of the new year, mortgage application volume has ticked back up. In the Mortgage Bankers Association’s (MBA) weekly application survey for the week ending January 3rd, application volume increased by 2.6% from the prior week. For the week ending January 10th, mortgage application volume increased again – this time by 11.9% over the prior week. Refinance activity showed an 11% increase while purchase activity also saw an increase by 12%.

The average contract interest rates tracked in the survey all saw decreases. Thirty-year fixed-rate mortgages with conforming balances decreased to 4.66% from 4.72%. Thirty-year fixed-rate mortgages with jumbo loan balances decreased to 4.58% from 4.66%. Fifteen-year fixed-rate mortgages declined to 3.72% from 3.77% and 5/1 ARMs dropped to 3.28% from 3.33%.


Bottom line for home sellers….buyers are still out looking! Listing now may keep you ahead of the competition.

Wednesday, January 15, 2014

Will rising mortgage interest rates lead to lower house prices?

blue interest rates
Many pundits are warning that there will be a drop in real estate values because mortgage rates are beginning to increase. The logic makes sense. However, history shows that increasing rates have not negatively impacted home values in the past.

Four times over the last 30 years mortgage interest rates have dramatically increased. Here is the impact the increases had on home values at the time:


Mortgage Rate

Home Values

May ‘83 - July ‘8412.63 – 14.67+ 6.6%
March - Oct ‘879.04 – 11.26+ 5.2%
Oct ’93 - Dec ‘946.83 – 9.2+ 1.2%
April ’99 -May 20006.92 – 8.52+ 10.9%

Perhaps the impact of increasing rates on future home prices won’t be as dramatic as some are predicting.

Tuesday, January 14, 2014

Ada County Real Estate sales end the year with a Big Bang.

Ada County Real Estate sales end the year with a Big Bang.

by marclebowitz

by Marc Lebowitz, RCE, CAE

Executive Director, Ada County Association of REALTORS

Single family home sales in December 2013 were 569 in Ada County, an increase of 12% compared to December 2012.  December sales were surprisingly strong; erasing two months of lackluster numbers and contributing to a strong 2013.

Year-to-date sales are 7,957; up 14% over 2012 YTD sales of 6,979.

Dollar volume for December was up 26% to $136 million and YTD we are just over $1.8 billion in sales.

The fourth quarter of 2013 brought worry (over what would happen to mortgage rates in 2014), frustration (over the Government shutdown and how that severely impacted our ability to close business in October) and uncertainty about the continuation of tax forgiveness for sellers in short sale deals.

In the end, the juggernaut that was 2013 overpowered all of those negatives and finished strong.

Days on market averaged 59 in December, up nearly a week from November.  Our year-to-date average is 52 days.

New homes sold in December totaled 134; up 16% from December 2012.

Historically, December sales decline from November by an average of 2%. December 2013 posted a 4% increase over November 2013.

Of the total sales in December, 11% were distressed; up 1% from last month. In December 2012, 24% of sales were distressed.

For the month of December, REO sales (55% of Distressed; 34 total sales) exceeded Short Sales (45% of Distressed; 28 total sales), for the second consecutive month.

Pending sales at the end of December were 686; down 13% from December 2012.

Of Pending sales in distress (15%), there was a decrease in the number of Short Sales (from 59% to 57% of activity; 58 total sales) and a increase in REO sales (from 41% to 43%; 44 total sales).

December median home price was $198,512; up 11% from December 2012.  Our 2013 YTD median home price is $198,000; up 16% for the year.

New Homes median price for December was $280,500; up 19% from December 2012. For Existing homes the increase is 13% to $183,000.

The number of houses available for sale at the end of December decreased 10% from November 2013 to 2,016.  This is the fourth consecutive month of decrease.  This is 15% more than last year at this time. Since January we have increased the number of single family homes for sale by 21%, allowing us to grow our YTD sales increase.

Historically, inventory decreases steadily from August to December.

Of the total active listings, 12% are distressed, up 1% from the end of November 2013.

With inventory experiencing seasonal decreases and the percentage of distressed inventory holding very low, median home price will remain strong through the end of this year.

Of our Distressed Inventory, 69% is Short Sales (166) and 31% is REO (74).

Available inventory decreased at all price points.

In Ada County we now have 3.6 months of inventory on hand, up a little from the end of November.

The price category in shortest supply is <$100K where we have 1.6 months.

From $100,000 to $160,000 we have less than 3 months available inventory.

From $160,000 to $300,000 we have slightly less than 4 months.

Above $300,000 we have a 4+ month’s supply. Above $500,000 the supply is closer to five months.  Remembering that six months of available inventory describes a “stable real estate market”; it looks like we are heading into a period of “normal” like we haven’t seen in several years.

Of sales in December, the most popular price point was $160,000 to $200,000 (23%); followed by $120,000 to $160,000 (20%), $200,000 to $250,000 with 14%.

So…what’s next?

Lawrence Yun, NAR chief economist, said the market is being squeezed. “Home sales are hurt by higher mortgage interest rates, constrained inventory and continuing tight credit,” he said. “There is a pent-up demand for both rental and owner-occupied housing as household formation will inevitably burst out, but the bottleneck is in limited housing supply, due to the slow recovery in new home construction. As such, rents are rising at the fastest pace in five years, while annual home prices are rising at the highest rate in eight years.”

For Ada County, the positives that have helped push the pace of our recovery past the national average are still in place; growing population, jobs creation and quality of life issues will bridge us through the slow winter months.


New High in VA Loans

I wondered if it was just me, but according to the article below I guess it was a trend. I knew I had a high number of buyers last year using VA loans. The good thing to remember is the VA process is much easier than it used to be, both from a buyer and a seller standpoint.  Home sellers had reason to avoid VA sales in the past with the extensive fees and over zealous evaluations of the home. Now they are really quite similar to a FHA loan.

"The Department of Veterans Affairs announced that the number of loans it guaranteed reached a record high in 2013.

The VA guaranteed nearly 630,000 mortgage loans in 2013, says Mike Frueh, the director of the VA’s Loan Guaranty Program. The average loan was about $225,000. The VA’s total loan volume has soared about 372 percent since 2007, according to Chris Birk, the executive editor at Veterans United Home Loans.

The New York Times reports that one reason for the increase is historically low interest rates, which have driven a high demand for refinancing loans. The paper notes that about half of last year’s VA loans were for the purpose of refinancing. However, that business did drop off a bit toward the end of last year as interest rates increased.

An overall tight lending environment is also making VA loans more attractive to service members.

“It’s become so much more difficult for military personnel and veterans to qualify for conventional financing,” Birk says. “This is the only path to homeownership for many.”

VA loans do not require a downpayment for first-time home buyers, and about 90 percent of all VA-guaranteed loans for home purchases are made without any money down. The loans also do not require private mortgage insurance.

The three states that have seen the largest increase in VA loan activity in the last year are Arizona (up 40 percent in 2013 over 2012), Ohio (30 percent), and Connecticut (30 percent).

Late last year, the Center for Specialized REALTOR® Education launched the Military Relocation Professional certification, a one-day program that trains real estate practitioners on the special skills needed to help veterans and service members engage in real estate transactions."

Source: “A Big Year for V.A. Loans,” The New York Times (Jan. 9, 2014)


Monday, January 13, 2014

The #1 Reason You Should Sell Now

The #1 Reason You Should Sell Now 

Posted: 13 Jan 2014 04:00 AM PST

Home For Sale Sign in Front of New HouseThe price of any item (including residential real estate) is determined by ‘supply and demand’. If many people are looking to buy an item and the supply of that item is limited, the price of that item increases.

According to the National Association of Realtors (NAR), the supply of homes for sale dramatically increases every spring. Putting your home on the market now instead of waiting for the increased competition of the spring might make a lot of sense.

Buyers in the market during the winter months are truly motivated purchasers. They want to buy now. With limited inventory available in most markets currently, a seller will be in a great position to negotiate.


Wednesday, January 8, 2014

Interest Rates-Going Up! But how far up?

From KCM Blog:

Most experts are calling for an increase in mortgage interest rates in 2014. However, we believe the increase will be more dramatic than is being projected. We believe rates will be closer to 6% than 5% by year’s end.

The Fed announced last month that they would be pulling back some of their stimulus package which has helped the housing market by keeping long term mortgage rates at historic lows for the last few years. This should come as no surprise as the KCMBlog has been warning of this likelihood over the last several months.

1.8 Interest Rate Projections

Above are the most recent projections of where rates will be at the end of 2014 by the four major agencies. However, we believe that the government is not afraid to shoot right past these levels.

Doug Duncan, chief economist for Fannie Mae, this past summer announced:

“I don’t think the Fed ultimately would be troubled with a 6.5% mortgage rate.”

And Frank Nothaft, Freddie Mac VP and chief economist, at virtually the same time explained:

"As the economy continues to improve, we expect to see continued upward movement in long-term interest rates… At today’s house prices and income levels, mortgage rates would have to be nearly 7 percent before the U.S. median priced home would be unaffordable to a family making the median income in most parts of the country.”

Only time will tell. However, we feel that rates will be in the 5.75-6% range by year’s end.


Tuesday, January 7, 2014

Idaho’s Maximum Homeowner’s Tax Exemption Increases in 2014

The Idaho Tax Commission has announced that the maximum homeowner’s tax exemption will rise from $81,000 in 2013 to $83,920 in 2014. The exemption has been in effect since 1980, when the maximum was $10,000, and “provides a partial property tax exemption to qualified homeowners for their primary dwelling up to one acre of land. The law exempts 50 percent of the assessed value from taxation; however, the exemption can’t exceed the maximum value that changes each year.