The Hammond Real Estate Report

New Haven real estate and properties in the rest of the Connecticut have suffered from frighteningly high foreclosure rates over the recent months.  Luckily, the trend seems to be ending soon.  According to Dan Levy’s Bloomberg article on November 12, 2009, “U.S. foreclosure filings surpassed 300,000 for an eighth straight month as unemployment made it tougher for homeowners to pay their bills.”  Additionally, “rising vacancy rates and the resulting loss of rental income will lead to the reduction of the market values of properties and increase foreclosure rates.”  However, foreclosure filings in Connecticut dropped over twenty-six percent to 2,306.  This positive change brings hope to several homeowners who have watched foreclosure rates increase in nearby New York and Massachusetts as of late.

New Haven homes for sale have maintained a relatively consistent price level despite other areas experiencing price cuts of up to forty-three percent, like in some Floridian neighborhoods. However, New Haven properties have not been immune.  In Daniel Taub’s Bloomberg news report on November 12, 2009, it appears as though more than thirty percent of homes in New Haven have experienced price reductions, although more recent numbers show that price reductions are beginning to taper off as the economy recovers and sellers begin to regain some pricing power.

A large part of real estate in New Haven is dedicated to Yale University’s faculty, staff, and students, and is largely seen as immune to most changes because of the properties’ operational necessity to the school.  Regardless, Yahoo! Real Estate reported 244 foreclosures in New Haven between October and November 2009, selling at a median price of only $139,000.  This price tag is a 0.7 percent drop from the previous month’s median.  The median price for other homes for sale didn’t change.

Although Waikiki is more and more becoming a land of international brand resorts and globally recognized hotel chains, the hallmark of Waikiki, the Royal Hawaiian Hotel, known to many as the Pink Palace of the Pacific, still graces the sandy beaches of Oahu’s southern shores.  Despite the rise in popularity of Waikiki condos, the Royal Hawaiian Hotel has been able to maintain a significant portion of the market share.  As one of the first hotels established in the area, the Royal Hawaiian Hotel is considered one of the flagships of tourism in Hawaii.  Although it first opened its doors in 1927, the hotel has been continuously updated to keep customers happy while maintaining its old Hawaiian charm.  Although the hotel was able to operate as an independent property for so many years, it opened in 2009 after major renovations as a member of The Luxury Collection division of Starwood Hotels.  The arrangement allows the Royal Hawaiian Hotel to continue to operate under its own name and entity.

Known to cater to the social elite and upper class tourists, the Royal Hawaiian has hosted some of the world’s most influential statesmen and celebrities.  Duke Kahanamoku, known as the father of surfing, frequented the hotel as did President Franklin Delano Roosevelt.  The president visited so often that the hotel was called the Western White House.

North Carolina real estate has seen an upswing in real estate activity thanks to the extension of first-time buyer tax credits by the U.S. federal government.  According to David Bracken’s November 6, 2009, article about credit and the housing market, “About 1.42 million U.S. taxpayers have qualified for the credit through August, including nearly 45,000 in North Carolina, according to the Internal Revenue Service.”  The income tax credit is valid for purchase agreements signed by April 30, and closings final by June 30 and can be applied to individuals with annual incomes up to $125,000 and joint filers with incomes up to $225,000 qualify for the full credit. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits.

Another victory for real estate in North Carolina on October 26, 2009, when the RealEstateRama newspaper reported that “foreclosure prevention efforts that have helped more than 1,100 North Carolinians save their homes got a boost earlier this month when the North Carolina Housing Finance Agency was awarded an additional $895,350 of federal funds from the National Foreclosure Mitigation Counseling Program.”  The worthy program has ensured that hundreds of families are kept in their homes and given the resources to refinance their homes.  The news article claims that “funds from the earlier grants are expected to provide counseling for more than 14,000 homeowners by year’s end. Of those who have completed counseling, 1,158 are known to have avoided foreclosure and only 40 are known to have been foreclosed on. The third grant is expected to assist 2,800 homeowners by June 2010.”

North Carolina homes for sale dropped in median price in places like Raleigh and Cary but also rose in price and gained value in several places.  David Ranii of the News Observer reported on November 10, 2009, that “the average sale price of existing homes in Durham rose 3.6 percent in the third quarter compared to a year ago, defying the national trend of declining home prices, according to a survey released today by the National Association of Realtors.”

Bainbridge homes for sale have seen a slight rise in popularity as federal government tax credits help to spur demand and increase interest, especially for first-time home buyers.  According to Rachel Pritchett of the Kitsap Sun on November 5, 2009, “the 380 pending home sales in October in Kitsap County were a substantive 59 percent jump over October 2008.  Experts say renewed interest is from buyers rushing to make the Nov. 30 deadline of a tax-credit program where they can save $8,000.”  Interestingly, while many properties in Western and Central Washington saw declines in value of up to seventeen percent, the article claims that Kitsap County, and especially real estate in Bainbridge, have been able to keep steady pricing despite the tough economic environment.

Another positive sign for the Bainbridge area was that “there were 1,795 homes for sale in Bainbridge Island in October, 27 percent fewer than a year ago. Sellers have pointed to a shrinking inventory as another sign of a market that is stabilizing.”  In what could be one of the slowest turnarounds in real estate history, both buyers and sellers are beginning to realize that they can only demand so much and must let uncontrollable factors do the rest.  On November 11, 2009, Pritchett followed up with another article about how well Kitsap County was doing compared to the rest of Washington state and the rest of the nation.  In terms of hard statistics, “eleven percent of all homes sold in Kitsap in September sold at a loss; nationally, it was 27 percent.  About 29 percent of homes saw increasing value over the past 12 months; nationally, it was 22 percent.”  These numbers are actually quite unusual for such a remote place like Kitsap County and Bainbridge Island.

Bainbridge Island real estate is definitely showing great improvement as the economy begins to move again and the recession begins to dry out.  Yahoo! Real Estate showed a 6 percent increase in the median home price between October and November to almost $160,000 while foreclosed homes jumped even higher, 6.9 percent, to over $80,000.

When the economy is booming, people are generally happier with their work and overall purchasing power.  They go out to buy things, they dine out and they make big investments such as buying real estate properties.  Similarly, when the economy experiences setbacks like the recession we are experiencing today, people have a greater feeling of needing to save.  They feel that they have to tighten their belts and not spend as much.  As a result, the economy goes further down.  People are not as enthusiastic about buying houses or properties.  With regards to selling, individuals find that they have to sell their houses to pay for mortgage, because they are relocated due to employment changes or some find that they would be able to save more if they lived with relatives.

From this instance alone, one can see that although the number of buyers goes down, the number of sellers remain the same or even go up.  As such, prices begin to drop and depreciation of properties takes place.  People should take advantage of this slow period, however.  After such a time the economy would surely kick off again and start to improve.  For this reason, people are still encouraged to make real estate investments even at this condition of the economy.

The key to making a good deal is to make a great offer.  When you have chosen the house you want to purchase, you can now start negotiating with the seller by writing him or her your first offer.  Usually sellers make the price known to potential buyers.  Do not be afraid to offer something that is lower than this.  After all, the seller has already considered having offers that are lower but still reasonable.  According to real estate experts, determining the proper amount that one should offer is a three step process.

The first step is to consider similar properties in the market and how much they are selling.  This is called comparable sales.  In the location where the property you are eyeing is located, consider what the going rate for houses is.  At least have an idea of the price range.  Compare the prices of homes within the same size, number of bedrooms, bathrooms, floors, garage space and total area that you are planning to purchase.  You may also refer to actual documents and databases listing the prices of similar properties.  Three main sources can be accessed by a certified real estate agent.  However, the public is generally restricted to it.  Nevertheless, there are public records and multiply house listings that can easily be accessed by the public.  You can make use of this.

The next step is to look at the house itself.  Does it need repairs?  Are you going to have renovations made?  Also take into consideration the condition of the seller?  Is she or he in a hurry to sell the property?  Is it in a mortgage under a bank?  As a third and final step, adjust the price you have come up with and analyze if this is indeed ‘fair’ for the seller.

It is not very hard to strike a good deal.  Just remember to be fair with the seller as well.  Talk to him or her about your concerns and even your budget and you could actually get that property you want.