I hope all is well with you this summer! It has been getting hot, a great time to grab friends and family and get on the LAKE! Go take advantage and enjoy what a great place North Idaho is in the summer. This monthly update I want to share information about: 1. Current Inventory, Sold’s, Month Supply 2. Total Market Overviews 3. Vacant Land 4. Foreclosures/Short Sales 5. Keller Williams LUAU Coming Up
1. Looking over July results, it appears fairly optimistic in line with the national housing results that were announced just recently. We sold 308 units in July 09’ (compared with 323, 08’). This is up over the 299 sold in June. The sales also follow the North Idaho trend of summer month sales more than double winter sales (Jan 09’ 120 units sold). If you look at the enclosed trend line stats, you will see what I am talking about. From here on out we can expect inventory to drop a little bit every month then start gaining momentum again in February. Currently, we are at 8,676 listings. If you are a seller, get your property listed to within the top 3 properties in your class (price,quality) if you want it to sell before winter. If you’re a buyer, this market is producing some incredible opportunity for primary residences in all price ranges. The $8,500 tax credit is still in effect until end of Nov. Also, on a side note, legislation just got passed, by Aug 15th loan servicers will begin to modify ANY FHA loans if the mortgagee applies and fits the profile (31% Front End Ratio, 55% Back End Debt) according to the Affordable Modification Program Letter 2009-23. Let me know if you would like more info.
2. Enclosed are the Total Market Overviews (TMO’s) for all of Kootenai County for CONDOS, MULTIFAMILY, and SINGLE FAM. Very interesting to look at, not much activity going on in the duplex/triplex fourplex realm, which may produce some opportunity in the coming year as inventory swells. As banks tighten lending even more, this may force more people to rent. I like the idea of big units 4+ bedrooms ect… Midrange condominiums 300-400K appears to be seeing some action. See the attached TMO’s. Kootenai County Total Market Overview
3. Vacant land inventory on our MLS is up over 3700 parcels available!!!! We sold 407 parcels in the last year. Here are 100 parcels over 80 acres. http://www.flexmls.com/link.html?ou3e0pn4ljn,7,1 You can view all of our land and search specifically for your needs at my http://www.LandCDA.com website.
4. Sellers are starting to price their properties similar to REO pricing. They have to in order to compete. Here is the current foreclosure list; 89 units available now. http://www.flexmls.com/link.html?ou3e0×99732,7,1 If you have interest, 208 REO’s sold in the last year for an average of $93/FOOT. Within 95% of list price. Average Days on Market is only 85 days for an REO, this includes escrow time AVG 45 days….See below for REO sold stats for first 200:
5. Keller Williams Luau – This is coming up Friday August 21, 2009 5-8pm and YOU are invited. 1044 NW BLVD. Food, music and a jumping tent for the adventurous. I hope to see you there!
Have a great remainder of August! As always, if you or anyone you know is looking to buy, sell, invest, lease, property in North Idaho please have them get in touch with me. I would love to work with them. I am always available. CELL 208-660-5785.
JEB COMMERCE used T.J. Barnhart at Keller Williams Realty in Coeur d’Alene, ID to negotiate their commercial lease in a Class A office space in downtown Coeur d’Alene. “We are very excited about our new office space and T.J. got us a fantastic deal” says JEB COMMERCE as they sealed their lease with a grand signing.
I showed JEB COMMERCE 8 different office suites in the downtown Coeur d’Alene area. There is definitely plenty of inventory to choose from in the office space environment. All were vacant units. We were able to use that information as a negotiating tool and we got a great deal. If you or anyone you know is looking to negotiate a commercial, retail, office, manufacturing, industrial lease in the North Idaho region, please forward them my information and I would love to help them out.
The North Idaho Real Estate Market has seen an increase in sales the last couple of months – which is not surprising – North Idaho is a wonderful place to be in the summer. 282 units sold in June. The average days on market increased to 137 days and we are sitting on 29 months of inventory (8340 listings). If we compare ourselves with June 08’ we will see a 13% decrease in total unit sales and a 4% decrease in price (221K vs 212K). Not bad considering the nature of current economic conditions. Please see the enclosed PDF files which include a 2 year trend line of real estate inventory, sales and activity, average sold prices for the last two years, asking vs sold prices, ect. Also, included is the Keller Williams Total Market Overview. This gives all listing, pending and sales activity in every price range. Notice the pick up in activity in the $200-250K price range. I also have Market Overviews for each area and segment in our market (Condos, Post Falls, Sandpoint, Waterfront, Multi-Family, 1 Mil Plus), just let me know what you want and I will send it to you immediately.
REO LIST (84 Active, 8 Pending – 23 sold last month)
Foreclosures and Real Estate Owned by banks continue to keep downward pricing pressure on our active listings. The availability of foreclosures continues to increase every month, with more than a 20% pending ratio! See the list below:
http://www.flexmls.com/link.html?ot50u7tjy8e,7,1
Short Sale List (188 Active, 21 Pending – 19 sold last month)
I ran all the short sales sold in the last year. 70 total. Sellers ON AVERAGE reduced their prices 10% since initially offering their property. Then they averaged a 3.55% price reduction from the bank while in negotiations. This tells me that agents are getting the prices on the short sales below appraised value and close to what the banks will accept. View the list of short sales here:
http://www.flexmls.com/link.html?ot50ucmw7aj,7,1
Waterfront Listings (84 North Idaho Waterfront Listings)
Summer is a great time to be in North Idaho. Here is the latest in waterfront listings.
http://www.flexmls.com/link.html?ot512zgi5s8,7,1
The commercial market is engaging a record $480 BILLION in debt coming due. This is a large number (up to 10X) compared to the residential market!
“…thousands of office complexes, hotels, shopping centers and other commercial buildings are headed into defaults, foreclosures and bankruptcies. The reason: according to research firm Foresight Analytics LCC, $530 billion of commercial mortgages will be coming due for refinancing in the next three years — with about $160 billion maturing in the next year. Credit, meanwhile, is practically nonexistent and cash flows from commercial property are siphoning off.”
Why, you ask, does this affect the market? Well, if you own a commercial property, and you have a balloon payment coming up, traditionally you would refinance, and start the process again. The availability of funds to refinance has dried up and terms have gotten tougher. Understand the issue? It is going to put a strain on banks ability to fund not only commercial but residential, credit lines, ect… This may present some distressed sales/foreclosures in the commercial arena. STAY TUNED. To view the available commercial inventory now, visit my site updated nightly with newest listings:
Coeur d’Alene, Idaho is truly a great place to live. Newsmax Magazine just ranked CDA, North Idaho a top 25 place to live according to lifestyle and ideals. Get the magazine, see the link!Coeur d Alene, North Idaho Top 25 Cities and Towns
I have grappled with this concept for the last couple of days, I figure now is the time to take a stab at explaining inflation effect on property owners, investors, and property buyers. I am no economist, just curious. First of all, I need to explain inflation in my simple mind. Inflation is the price of goods/services going up as a result of the increase in money supply - a decrease in purchasing power. As the FED prints more money it dilutes the value of the money currently in the market driving up prices of goods and services. As a counterbalance to the rise of inflation, the government and/or market raises interest rates. Somehow, unemployment, output and productivity come into play as well.
INCREASE IN FORECLOSURES - Now, as the price of goods and services go up, property owners have to spend more of their income on these items reducing the amount of disposable income. Homeowners that are at the edge of their expenses who do not have savings, become unemployed or have not had increases in salaries will be pinched on making mortgage payments. When a person has to choose between food for family or mortgage, the food will probably win. There will be an increase in foreclosures. Take into account adjustable mortgages as well, when interest rates reset, payments go up making the pinch and foreclosure statistics a whole lot worse.
BIGGER POOL OF RENTERS - When people lose their homes, they are still going to have to have shelter. I think investment properties, rentals, will have a steady availability of tenants. We are seeing this now in North Idaho. Leases/rents are negotiable and reset after a set period of time investors can increase rents based upon inflation creating a hedge that a typical homeowner cannot.
INVEST IN ASSETS THAT CAN PAY OFF YOUR DEBT - Creating hedges in an inflationary environment is key to wealth protection. Inflation hedges include tangibles and goods (commodities). Land and property is definitely an asset but you have to buy right. Finding property deals that are close to the bottom as possible is key. Any good agent can give you a synopsis on the current market conditions in the area you would like to purchase. Good indicators would be level of foreclosures and short sales, active price ranges, and amount of solds/pendings in each price range.
HYPERINFLATION (a long shot) - Lets say hyperinflation comes around - that is - huge increase of inflation month over month. The value of money changes drastically and becomes worth less and less (i.e. it takes much more dollars to purchase the same thing). It makes sense if you have tangibles that increase at the same rate, if you owe 200,000 on your property and a pound of gold is worth 200,000 you can sell and pay off your house. I see having debt as being a plus in a hyperinflationary environment, AS LONG AS, you have assets, tangibles, goods that can counterbalance. The value in this for example, is now you can buy pound of gold for under 16,000. You have got to have a means to create income that is adjusted to inflation on a daily basis.
IN SUMMARY - The key to inflation and the housing market on you, the property purchaser is to make sure you get the best deal you can on a house you have interest in. Be aware of what is on the market, and the direction the market is headed in you area. Act in front of the market. Your real estate agent should be able to help you with local housing information. If you can get a loan, buy an investment property in foreclosure or one that is priced right. If your the property SELLER, get your price in front of the market now! That is where the buyer pool is. If you are backwards in value to loan on your house, shortsale it. Banks are taking losses on their loans, freeing up homeowners that could go into foreclosure. Good luck and let me know if I can help!
Property buyers in the $125-175k price range are the winners in this market. Over 700 options available, including 26 foreclosures! We are almost experiencing a 20% pending ratio with listings available and listings with accepted offers. A buyer can reasonably expect to get a property within 97% of list price. I currently beat that with my clients, I typically get within 90-94% of ask price with buyers I represent. Let me help you navigate the process. Real estate is what I do.
This is a great snippet about Idaho being a state that may show employment numbers that actually improve. This is good for housing. In North Idaho, we are better off than the average national unemployment rate. See the article below.
5 States Moving on to LOWER Unemployment
In a report from Moody’s, projections are that 5 states expect an increase in private employment by the fourth quarter 2009. Due to the density of high tech jobs in the northwest, the region is well positioned to spark the rise in employment.
Colorado, Idaho, Oregon, Texas and Washington are all expected to show improved employment. Texas jobs will improve due to the oil industry but the other states will benefit from their technology industries. Another factor adding to better conditions in these states is the fact that residents have better than average household credit ratings. Analysts expect the housing market to improve in these states first.
Michael Pereira with All West Environmental Engineering.
Michael P. used T.J. Barnhart, REALTOR and owner of Keller Williams Coeur d’ Alene, to navigate the throngs of buying a home in North Idaho. Michael ended up buying a Hallmark home in Hawks Nest. After looking at numerous homes with his real estate agent, he decided the best option was a new construction. See the video above…
Across the nation real estate existing home sales are up. There are more properties selling now that prices are dropping to levels that buyers feel comfortable. We are seeing that in the North Idaho real estate environment as well. Prices have been dropping and we are seeing a huge level of buyer activity, particularly in the sub 175K range.
I was in some new construction model homes this weekend with real estate clients (Hawks Nest, Viking Construction and Hallmark Homes (I wrote 3 offers on Saturday). I was observing that there was a constant stream of buyers coming in. I think North Idaho real estate will be picking up starting now. Looking at the total market overview, we are at a 20% pending ratio for sub 175K homes (number of listed to number of pending), which is very strong compared to the last couple of months. If you would like a copy of this weeks Kootenai County Total Market Overview (TMO), just let me know and I will send you a copy.
