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December Real Estate Forecast shows a strong finish to an extremely active year in the Central Oregon Real Estate Market

2016 was a great year for real estate in Central Oregon, and December closed out the year with a strong finish. Sales were up in December, despite lots of inclement weather and snow, inventory dipped expectedly, and a consistent number of pending sales are expected to complete in 2017. Let’s take a deeper look.

Monthly Number of Sales and Price Reductions

The monthly number of sales stayed at a consistent high in the market. The number of price reductions in the month of December were fewer than the month before, as the number had nearly stabilized in November. Price reductions typically happen when properties sit on the market too long, with little to no interest, and it typically means that the property hasn’t been priced correctly. With fewer price reductions in December, we can expect to see more sales moving into early 2017.

Inventory low

Inventory has dipped to an annual low, which is to be expected in the month of December and is typical during the holiday season. The inventory seen this month was lower than the previous four months.

The real estate market becomes more of a seller’s market during the winter months, with fewer listings available.  Property owners should take advantage of this time, with little competition for potential buyers. Duke Warner has months of inventory for every price point under $525,000 in Bend being less than two months.

Consistent Pending Sales

Pending sales stayed at a high number for the month of December, which is surprising considering the winter weather December brought.

Final Analysis

All of this proves that we can expect an active beginning to 2017, that will carry on into the coming winter months.

Sales are expected to remain at slightly above average numbers. Due to the interest in the Central Oregon Real Estate Market, we can expect that fewer price reductions will take place.

The seller’s market will continue into the new year, with fewer properties listed. The time to get a property listed is now, with the expectation of significant activity and lots of serious buyers early in 2017.

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Pros and Cons of Open Houses

Pros and Cons of Open Houses

Selling your home? Considering holding an open house to spark interest? Open houses have long been a point of contention between seller and real estate agents. Some sellers insist upon them, refuse to have them or are undecided about them. Real estate agents are the same: some love them, hate them or don’t have an opinion either way. Learn about some of the pros and cons of hosting an open house, and decide if it’s a great option for you or not.

Pros

There are both negative and positive results to holding an open house. By holding an open house you may be able to attract buyers who are dragging their feet on the start of their house hunt. Some buyers may not be sure as to how to get the ball rolling on a house hunt, and an open house is a great way to get some potential buyers in the door. An open house sign on the side of the street may attract someone who has not yet begun the steps to start house hunting. They allow potential buyers not to feel pressured.

Open houses give great additional exposure to a home. Often open houses are advertised with street signs, newspaper ads, ads online and more. They may also be beneficial to your realtor, as it gives them a chance to connect with other potential buyers.

Cons

Open houses are not necessary to sell a home. The percentage of homes that sell as a result of an open house can actually be quite low. More potential buyers schedule private showings of properties that they’re seriously interested in. Most buyers want to be taken through the home by an agent, and learn about the property. Most open house crowds are less serious.

In order for a potential buyer to be viewing homes with an agent, they must be pre-approved for a certain level of mortgage. The potential buyers that you’re going to attract with an open house could contain a majority of visitors that aren’t even pre-approved. Having people walking through your home, that can’t afford to buy it, is a waste of your time. You would be upset with a realtor that kept showing your home to potential buyers that couldn’t afford to purchase it. Hosting an open house can sometimes be the equivalent of this.

Final takeaway

Deciding to hold an open house for your home is a choice you must make. Consult your real estate agent and get their thoughts on it. Some think that open houses are old fashioned, and in today’s market where the seller has technology at their fingertips, they’ll probably do most of their research online.

 

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Why Hire a Listing Agent?

Why Hire a Listing Agent?

If you’re getting ready to sell your home or property, you may be thinking why do I need a listing agent? With technology these days, you can probably list the property yourself and save yourself the cost of a real estate agent, right? Here are some reasons why hiring a professional real estate agent could benefit you in the long run.

Experience

Local real estate agents have experience selling. While this may not be the first home you’ve sold, a real estate agent has sold hundreds. They know the market you’re selling in, and know what listing prices to recommend, who to market to, etc. A great real estate agent will help you negotiate on a great price, not simply delivering the offer to the buyer.

Agents also can act as a filter for showings and visits. Your agent isn’t going to show your house, unless they’re sure they’ve found a great buyer for it. Typically, your agent will show the house to prospective buyers that have already been vetted or pre-approved by the firm they represent. In short, they’re showing your property to people who they know are interested and who they know can afford it. When you list a property yourself, the calls you get for showings won’t be verified and you could wind up wasting time showing the property to a lot of uninterested buyers, or buyers that aren’t serious about committing to a new property.

Market Knowledge

Agents know what you should list your property at, because they’re working closely with the real estate market in your area. They can find comparable sales for pricing references. Local real estate agents also know where it’s best to market your property. Your agent won’t tell you what you should list your property at, but they can help guide you to a price that increases your changes of selling.

Your real estate agent is there to ensure you have as easy a sale as possible. They’ll help with paperwork, questions and more. Purchase agreements can run over 10 pages, without including federal or state disclosures.

Take Away

There are a lot of questions that come with buying or selling a home. One of the greatest benefits of having a listing agent is that you can call them and ask questions anytime. Even after you’ve closed your home, if you get an invoice about property tax assessments that you don’t understand, you can call them and straighten it out. Lots of questions can pop up after the excitement of closing on a house, and a real estate agent will still be there to answer them.

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November real estate forecast shows drop in new listings and stabilization of home pricing

The real estate market has slowed down slightly for the holiday season, from an eventful fall market. It continues to be a seller’s market in the Central Oregon Real Estate Market. Moving into the new year the market promises to be a great time to list a property.

Fewer listings and inventory

Typical for the holiday season, fewer new listings are coming onto the market in Central Oregon. With fewer listings on the market, November still saw more properties go into pending. With more pending listings than new listings coming on to the market, there were lower property inventory numbers.

Novembers inventory was lower than the previous three months. Even with a lower inventory, more homes sold in November than in October, representing great activity in the Central Oregon Real Estate Market.

Price reductions

The number of price reductions has dropped dramatically from previous months, with pricing stabilizing in November.

Seller’s Market

With a limited number of listings, it’s a perfect time to sell. Getting your property on the market at this time would be advantageous. Fewer listings could help to highlight your property. This trend is expected to continue through the new year.

Property owners that are thinking of selling should take advantage of the low inventory of property competing for available buyer’s.

Final Analysis

We can expect the trend of the seller’s market to continue. Fewer listings provides for a better market for the seller’s with fewer properties to choose from and consider.

The beginning of the new year is a great time to get a property listed. We can expect the trend of the seller’s market to continue, with continued high buyer demand for properties.  Listings that hit the market early in 2017 should have significant activity of serious buyers’ wanting to make a purchase.

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How long should you own a starter home?

How long should you own a starter home?

Starter homes are great for first time home buyers. While they can tend to come in lower socio-economic areas or require a bit of a fixer upper, they can be a great investment and a great way to enter the housing market.

The case against Starter Homes

A lot of people invest in smaller homes as their starter homes, like townhomes or condos. While this can seem like a great idea at the time, you should really only invest in property if you plan on staying there for at least 5 years.

Typically, when first time home owners buy their first home, they have a renting mindset. They are used to yearlong leases, and may have a harder time grasping the concept of longevity in a house. After about three years most people tend to start looking for larger properties.

Staying in a house for at least five years, can help you see more of a return on your investment. Moving after three years of owning a home can tend to lose you money, unless you’re planning to keep the property as a rental property.

Consider closing costs. Every time you buy and sell a home you have to pay closing costs. While these costs may be small compared to the overall price of a home, it’s still money that you lose every time a housing transaction is made.

They way most mortgages are structured, you pay more interest in the first five years. So spending only five years in a home can be a waste of your resources. After five years, you usually have made enough progress on the principal amount due, to justify paying a mortgage rather than just rent.

The case for Starter Homes

People tend to invest in as much house they can afford, which generally isn’t much. It’s usually in the upper end of what your finances allow, which stretches you thin. If you consider buying in the lower range, and not spending as much money a month on your mortgage, you have the chance to pay off a bigger chunk of your principal amount owed.

Purchasing a starter home is completely up to you and what your finances allow, but consider whether you truly consider your home a starter home or whether it’s an investment that you want to make and commit to for years to come. Consider what you can afford and what you’d like your monthly payments to be, what you want to be financially responsible for. If you want more flexibility and may not want to stay in the home for a long time, buy on the lower end of your budget. It gives you the chance to pay off the home faster, giving you more leverage when you hit the housing market the next time.

 

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Different Types of Mortgages

Different Types of Mortgages

If you’re looking at becoming a first-time home owner, you may need to brush up on your mortgage knowledge. Talk to your real estate broker and see if they can recommend a lender for you to talk to about your mortgage options. Getting pre-approved when you’re house hunting can be a great advantage to getting the home that you want.

If you’re pre-approved you already know what sort of financial situation you are in, and what sort of mortgage you can afford. Therefore, you know what price point of homes you can look at, what price of homes that you can afford.

Learn about different types of mortgages here and talk to a lender and see which mortgage works better for you.

Fixed-rate mortgage

A fixed rate mortgage means that the interest rate for the loan, is locked in at the beginning of the mortgage agreement. Fixed rate mortgages can come in terms of 10-15-30 years. The most common of mortgages is a fixed rate 30 year mortgage. This provides the owner with the lowest mortgage payment per month, as it divides the loan into 30 years of payments, with a fixed rate of interest.

Fixed rate mortgages are also popular because they are the most predictable; the owner knows what their payment will be month to month for the entire timeline of their term in years.

Adjustable Rate Mortgages

There are many different types of adjustable rate mortgages(ARM), but the essential idea is that the interest rate can change over time.  If a home buyer gets a one year ARM, the interest rates on their loan change to the current market rate, once a year on the anniversary of their loan. This can be risky as you could wind up paying different amounts of mortgage payments from year to year. They payment amount may go down, but it also may go up.

10/1 ARM’s also change in interest as time goes on. This features a fixed interest rate for the first 10 years, but then is subject to change every year to the current market interest. This loan is typically for 30 years, and is typically used by homeowners who intend to pay their home off before the initial 10 years have passed.

Balloon Mortgages

Balloon mortgages feature a much shorter term and a fixed rate of interest, much like a fixed rate mortgage. The difference is that balloon mortgages feature a larger or balloon payment at the end of the loan. The monthly payments are lower and typically go to interest being accrued. Balloon mortgages are great for responsible borrowers, and typically are for people who intent to sell the house before the balloon payment is due. These mortgages can get tricky, as you’ll be required to re-finance if you can’t afford the balloon payment when it’s due.

Check out the different types of mortgages and see what you can afford, and how long a payment schedule you want to commit to. Talk to a lender to see what your options are and what makes the most sense for you.

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October real estate forecast shows drop in number of homes sold and home prices

The real estate market has slowed down since an eventful summer market. Even though things have slowed slightly in the Central Oregon Real Estate Market, November is promising to be a strong month for the year.

Median Home-sale price

In October, the number of homes sold dropped from September. The median home-sale price in Bend, Oregon, fell in October, which copies the trend from October of last year. The year-to-date median sales price continued to rise last month, adding a very small amount in October to the previous month’s figure. The median sales price has continued to rise each month in 2016.

The median sales price in September, of $385,750, dropped by 4.2 percent to $369,500.  September’s median sales price was the second-highest in the 10 years for which Duke Warner Realty has data. In three of the last four months, the median price has been less than $370,000, a threshold reached in May ($374,000), June ($370,000) and September.

Before 2016, October’s figure of $369,500 would have ranked as the second-highest for any month in the past 10 years, behind the high of $396,250, achieved in May 2007. This is a pretty impressive number considering Central Oregon’s trends concerning the real estate market.

Number of homes sold

 The number of homes sold has decreased, with the lowest number sold per month since March. One hundred ninety-two homes were sold in October, and 185 were sold in March. Sales and transactions aren’t processing as fast as they have in recent months, which is to be expected in the fall market. October’s total units sold was the lowest by 12 percent for the last couple of years. September finished with 229 homes sold.

Final Analysis

The median home sale price has dropped from September, just like it did in October of last year. Number of homes sold decreased from September to October, lowest since March. This can be attributed to a slower transaction process.

We expect to see a very active market in November, including pending sales moving the following months.

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The Pros and Cons of Owning a Timeshare

The Pros and Cons of Owning a Timeshare

If you’ve ever considered investing in a timeshare, there are many options to consider. You need to know how they work and if that fits into your yearly vacation plans. Here is a breakdown of what timeshares are and if they are a worthy real estate investment.

What are timeshares?

Timeshares are typically fully-furnished apartments or condos that you can pay to rent for certain weeks of the year. For example, you may pay to rent the same condo in Florida, for the same week or two of every year. You will sign a contract and pay a lump sum to ensure that for the time-period of the contract, every year the condo is yours for a specified date range. The average sales price of a share of a condo is $19,000, with a smaller yearly maintenance fee.

Some companies are offering a points system timeshare system, that can provide more flexibility. Users earn points that can be used at any time of year at certain hotel or property system. For example, if you buy into a hotel chain’s timeshare program, you have the flexibility of staying at any of those hotels locations, with some flexibility added in.

Cons

Timeshares can be a long-term financial commitment. Most timeshares don’t have an expiration date, meaning you’re saddled with a yearly maintenance fee until you sell your timeshare. This isn’t a problem if you use your timeshare every year, but if your enthusiasm wanes, getting rid of your timeshare could be slightly more difficult than selling a house.

If your finances aren’t exactly stable, investing in a timeshare may not be for you. You want to make sure that you can always afford the yearly maintenance fee. While affording a monthly mortgage is still something you need to plan for, a mortgage ends when the loan is paid off. Timeshare agreements don’t typically have end dates, so be prepared to pay fees until you get rid of the share.

Pros

You typically save on travel expenses, because you don’t have to pay for a place to stay. Cost per usage can work out when you factor in the cost of hotels on normal vacations. Because you have access to a full kitchen in most timeshares, you also can save money when you travel, due to less restaurant dining.

Some timeshare programs offer trades for users, letting them trade their weeks for shares in other locations. For example, you’ll give up your week at your normal timeshare in Florida, for a week in Spain.

One of the pros that timeshare users note is that you’re guaranteed a vacation once a year. Whether you rent your timeshare out, or trade it for another week, it’s certain that it forces you to take the time each year to take a break and go on a vacation.

If you’re concerned that the excitement of going to the same place every year may wear out, consider purchasing of a timeshare with a points system, so you can trade weeks and experience new locations.

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Showing your home in winter months

Showing your home in winter months

Perhaps you’re selling your home in the colder months. While it may be easier to sell a home with lush flowers, bursting garden beds and green grass, there are ways to highlight a home in colder months to make it appealing to potential buyers.

For potential buyers

If you’re looking at buying a home in warmer months, it’s important to know how the house is heated. Heat can be a major expense in some homes. Older homes may feature older heating systems, which can cause you more money in utilities in the long run.

Know how warm the house typically stays. Try to find out if the house hold’s heat well, or if it’s drafty. This doesn’t strictly apply to older homes. Newer homes can leak heat as well.

Know what sort of climate that you’re buying in. If it’s cold all the time, your heating system is important to consider. If you’re buying in a mostly warm climate, it may not be that important.

If the home you’re looking at is in a very cold climate you may want to consider roads leading to your house, or your driveway. If there’s only one way to get to your house, and it features an extremely steep hill that’s prone to ice, you may want to reconsider the home.

For homeowner’s selling

Make sure to inform your listing agent how your home is heated. If your heating system is outdated, updating it could make your home more attractive to potential buyers, and help you get more value when you sell your home.

Highlight warmer areas of your home, like a central fireplace in a family or living room. Be sure to flaunt any additional warmer features, like heated floors or a master bedroom fireplace. These are features that will entice buyers.

Selling a home in the fall or winter

Some people think that buying or selling a home in the fall or winter is a bad idea. Typically the housing market has more listings in the spring and summer, as people believe this is the “perfect time to buy.” The reality is, people buy homes year round, and in the colder months you’ll find more serious home buyers. Buyers in cooler months tend to be more serious. They need a home now which is why they’re looking.

Take Away

The housing market doesn’t fall flat in any market in the colder months. People will always need homes, and sometimes they can’t or don’t want to wait for warmer months. Make your home seem as cozy as possible and highlight any unique heat-related features. If you’re looking for a home, be sure to consider how it’s heated, what your utilities could look like, and what sort of climate you’re in.

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Tips for Getting Your Home Appraised

Tips for Getting Your Home Appraised

If you’ve decided to sell your home and get it appraised there are some things you should know to look out for to get a better appraisal price. Here’s a list of what to fix, organize and look out for.

Let your appraiser know about any home improvements you’ve done over the years. Don’t leave anything out that could potentially help increase the value of your home.

Simple updates can go a long way when you’re getting your home appraised. Try updating fixtures, like doorknobs, light fixtures, faucets, etc. Updating paint color and window coverings can also help a home to feel more updated.

Always be sure to keep your eye on the market in your area. Check out other homes that are for sale and see what they’re highlighting or updating. It’s best to stay competitive on these features. You may be able to figure out what cause problems in appraisals within your area. This information should be public record.

Make sure to have all of your safety equipment installed and working properly. Check all of your smoke alarms and carbon monoxide alarms to be sure the batteries are charged and working properly.

Clean! A clean home is always more attractive than a cluttered or dirty home. Clean counters, tables and other horizontal spaces that tend to gather junk and piles of mail or magazines.

Take care of your lawn. If you have brown patches get your sprinklers fixed, or invest in a bag of grass seed and get that portion of your lawn re-growing. Trim any bushes or trees that have gotten overgrown, and weed your flower beds. Make your home look like you take care of it regularly, and it will make the home’s value higher, to both an appraiser and potential buyers. Think about curb appeal.

A great tip from appraisers is to fix anything that cost less than $500 to fix. Even if they’re small fixes, and you think they won’t harm your appraisal or selling price, they could. A small fix that costs $150 could often cost you much more than that in value after an appraisal.

Be sure to familiarize your appraiser with attractions in your location. If there is a school or park nearby, or a small neighborhood café or grocery store. These things tend to increase the value of homes, as they offer convenience.

You can always talk to a local real estate broker and find out what their buyers are looking for in homes, and what they’ve seen prior appraisers focus on. Get some help in diagnosing what you want to focus on improving or fixing.