Supply of Central New Jersey Homes for Sale Struggles to Keep Pace

May 22, 2013 By Mike Downer Leave a Comment

So the market’s recovering, interest rates are low, and you think you’re finally ready to buy a home? Not so fast. Buyers across the country are running into a new roadblock: there don’t seem to be enough homes for sale.

Anyone who has looked at entry- to mid-level homes for sale in Central New Jersey neighborhoods probably knows what I mean. Mortgage rates remain near historic lows, and as the prices of homes for sale continue to rise, fears that we could soon see a repetition of a real estate equity loss seem increasingly unlikely.

Why the lack of inventory? There are several reasons. Buyers may be ready to buy again, but some sellers are still not in a position to offer their homes for sale. When the housing market collapsed seven years ago, some homeowners’ equity loss was such that they remain unable to sell. Prices may be on the rise, but some need more time to return to pre-crash values.

Buyers always want to buy at the bottom, but sellers want to avoid selling there. Buyers are watching that bottom fade into the distance, but some sellers, pleased to watch their homes growing in value, are content to wait longer.

NAR says that there were just 1.93 million existing homes for sale on the national market in March, down nearly 17% from the prior year. In a well-balanced market, what had been a six month’s supply fell to just 4.7 months’ worth. Nationally, homes for sale now stay on the market for just 62 days, down from a median of 91 days only last year. Glenn Kelman, CEO of an online national real estate brokerage, put it succinctly: “Somebody rang a bell and said the boom is back, and nobody wants to be late to the party.”

Homeowners who have been thinking about selling are increasingly liking what they see in today’s market — including the prospects for trading up. Even those whose previous evaluations were unsatisfactory are finding it worth another look. If you would like to find out what your home is worth today, give me a call!

The DoorPath Team is the most comprehensive online source for Central New Jersey real estate information and services. Whether you are looking for the latest sales, trends or homes for sale in Somerset, Middlesex, Union or Hunterdon Counties in New Jersey, The DoorPath Team at Coldwell Banker Residential Brokerage has it all at your fingertips. Browse information regarding short sales, foreclosures, new construction, investment property, land sales or commercial locations throughout Central New Jersey plus much more at www.DoorPath.com or call Michael “Mike” Downer at 732-302-1771.

Filed Under: Buyers Resources, Central NJ Property Information, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, Doorpath Team, foreclosures, home sales, housing inventory, Hunterdon County, investment property, land sales, loan modification, market recovery, Michael Downer, Middlesex County, new construction, short sales, Somerset County

Central New Jersey Real Estate Market Balancing Act: Rates vs. Rises

May 21, 2013 By Mike Downer Leave a Comment

When the Wall Street Journal or Forbes run mortgage rate stories as their lead items, those of us who keep an eye on the Central New Jersey real estate market pay close attention. I frequently share what they say here. But when even the non-financial outlets like USA TODAY and the cable TV news channels give top billing to real estate market news, it’s a real attention-grabber.

That’s what happened last week. USA TODAY’s online headline focused on the 15-year fixed mortgage rate, “at a record low 2.61%.” The cable news channels talked about record low rates, too (although if you hit the ‘pause’ button long enough to read the TV graphics, you saw that the national average for 30-year loans was still a shade away from the actual record low).

Never mind that; it’s still surprising that mortgage rates continue to linger at such tempting lows.

The reason is hardly a secret: the Federal Reserve is holding rates down to energize the real estate market — a key element of the overall economy. Yet, with existing home sales notching up in the first quarter at the briskest pace in four years, you would have thought that mortgage rates would have been loosened up at least somewhat. And with new home sales doing their best since 2008…

Of course, it doesn’t matter what anyone expects: the results of dipping mortgage rates is just plain good news for everyone in the Central New Jersey real estate market: buyers and sellers alike. Those low mortgage rates act to offset the rising U.S. house price index. The result for buyers is a more valuable home without the expected increase in the monthly payment. What more of an inducement to enter the real estate market could there be?

In short, if you’re considering whether it’s time to buy (or to sell your current home and trade up without busting the household budget), last week’s national and local market signs are even clearer than they have been recently. There are definitely opportunities out there! Why not give me a call for an up-to-the-moment Central New Jersey real estate market evaluation?

Filed Under: Buyers Resources, Finance, Sellers Resources Tagged With: 15-year fixed mortgage rate, Central New Jersey, Coldwell Banker, Doorpath Team, Forbes, foreclosures, Hunterdon County, interest rates, investment property, land sales, loan modification, Michael Downer, Middlesex County, mortgage rates, new construction, short sales, Somerset County, U.S. House Price Index, USA Today, Wall Street Journal

Part 2 — Top 6 Mistakes For Home Sellers to Avoid

May 17, 2013 By Mike Downer Leave a Comment

Previously, we cited three of the most common mistakes sellers make after listing their Central New Jersey property for sale. Here are three more:

Proper Insurance

When you have a Central New Jersey property for sale, it’s more important than ever to see that your homeowners insurance is up to date. It is highly unlikely that someone will have an accident on your premises, but the increase in the number of visitors makes it prudent to be well covered. Of course you will want to mitigate obvious potential hazards like broken glass or exposed nails — but should also have a foolproof system for making pets a non-issue during showings.

Contractual Terms

With your property for sale, it’s only natural for your primary focus to be on the bottom line: the sale price. When an offer arrives with the right number, it’s tempting to sign on the dotted line and be done with it. But there is more to a purchase offer than just the price. An offer is a contract, and as such, all its terms are equally binding. For instance, there is the matter of the closing date: sellers who accept an offer without paying enough attention to it can be left scrambling for temporary housing when that date arrives.

Contingency Removal

Removing the inspection and loan contingencies on time are key events in the buy/sell timeline – yet these deadlines can easily slip by unnoticed. The wording of the clauses is important, too, because a buyer can have the right to withdraw an offer if he or she is not satisfied with the outcome of an inspection or a loan rate they deem acceptable. Failure to make sure a buyer removes contingencies on time can turn a ‘sold’ property into a property that’s still for sale.

Aligning yourself with an experienced agent is the simplest way to remain aware of these and other common legal miscues — and how to avoid them. With your property for sale, you become a single-purpose business enterprise, and your agent’s knowledge should be a key business asset. Contact me anytime for that kind of assistance!

Filed Under: Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, contractual terms, Doorpath Team, foreclosures, Hunterdon County, insurance, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, short sales, Somerset County

Central New Jersey “Boomerang Buyers” Enter the Picture

May 16, 2013 By Mike Downer Leave a Comment

“Time flies when you’re having a good time” we hear. But time can also pass quickly for those who’ve had to go through difficult times. Case in point is a million and a half borrowers who have recently experienced the pain of a foreclosure. That’s the estimated number of those who, by this time next year, will have waited long enough to again become eligible for an FHA loan.

Anyone interested in buying a Central New Jersey home after a foreclosure has come through a tough period. The standard waiting period for an FHA-guaranteed loan is 3-4 years following a foreclosure or short sale (though individual circumstances vary). Now that the weeks and months have ticked by, this sizable crop of newly eligible prospective ‘boomerang buyers’ may soon find themselves contemplating the option of buying a home after a foreclosure.

That estimate of the size of the newly eligible was provided by Moody’s Analytics. Since they are key players in determining creditworthiness, it’s a source I trust. A chart of Moody’s count from the second quarter in 2011 (when their number was a mere 285,000) to next year’s second quarter 1,500,000 provides a convincingly uphill slope.

Still, being eligible to apply does not mean automatically qualifying for an FHA (or any other) loan. Success in buying a Central New Jersey home after a foreclosure continues to depend on the same standards that always apply. After the waiting game is over, having cured credit damage will become the prime requirement.

To increase their chances of successfully buying a home after a foreclosure, Central New Jersey prospects will have paid existing credit card and loan debts with the kind of unfailing regularity that reassures loan officers and credit analysts alike. If that hasn’t been the case, the time to begin is ASAP.

Website Zillow predicts the next most influential group of buyers will be those who are looking to buy a home after a foreclosure or short sale. Central New Jersey residents who are among them — and who are ready to make this their turnaround season — should give me a call. We can get started with the pre-approval process!

Filed Under: Buyers Resources, Finance, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, Doorpath Team, FHA, FHA Loan, foreclosures, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, Moody’s Analytics, new construction, short sales, Somerset County

Part 1— Top 6 Mistakes For Local Sellers to Avoid

May 10, 2013 By Mike Downer Leave a Comment

Disclosure Signatures

Disclosing material facts that might affect your Central New Jersey property’s value is a fair obligation that’s understood by everyone. Yet properly disclosing all material facts won’t help you at all if an issue comes up later but you can’t prove the disclosure. A good agent will double- and triple-check all the signatures, but at the end of the day, your peaceful sleep at night is only protected when you also take care to keep complete copies of the paperwork with all signatures accounted for.

Earnest Money

Ah — the thrill of getting the first offer! After readying the property and listing your home, when an offer comes quickly, you’ll be tempted to say, “Where do I sign?” But slow up: getting a great offer is just the first step. Part of being a prudent seller is scrutinizing the offer and buyer to gauge the likelihood that the deal will close. The amount of earnest money should demonstrate the prospect’s sincere intent to buy…not just their desire to tie up the house while they make up their mind!

Exclusions

Want to watch warm feelings ice up in a hurry? Try surprising your buyer with the last-minute news that you intend to take your coveted washer/dryer (or heirloom chandelier, or custom closet system) with you because you forgot to exclude them. It’s part of my job as your agent to go over the more obvious items when listing your home in Central New Jersey, but even so, it’s ultimately up to you to make sure your intent is known. Trust me – I’ve seen more than one sale go south in the eleventh hour over some unbelievably minor items.

Coming next, I’ll flesh out more of these most common pitfalls. Of course, listing your home with me means you won’t need to worry: I make it may job to keep an eye out for all of them. If you’re thinking of listing your home in our area this spring, call me today!

Filed Under: Sellers Resources Tagged With: Central New Jersey, chandelier, Coldwell Banker, custom closet, Doorpath Team, earnest money, foreclosures, heirloom, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, short sales, Somerset County

Appraisal Lag Hurting Buyers and Sellers

May 8, 2013 By Mike Downer Leave a Comment

Despite the uptick in prices in the Central New Jersey Grove real estate market, buyers continue to have issues with their appraisals. Property values are increasing significantly over a short period of time (particularly here in Somerset County) and appraisers are hesitant to use the higher sales figures in their analyses. We are seeing a lag of about three months in appraisal decisions reflecting the current value of homes.

With this in mind we caution sellers to be realistic in their pricing. Every home has to sell three times; once to the agent who agrees to put it on the market at that price, once to a buyer who agrees to the price and lastly to the mortgage company who is investing in the home. If a home does not appraise in most cases it will kill the deal or cause a major adjustment at the last minute to the agreed upon terms.

Sellers will take a cash deal over a financed deal any day because it gives them peace of mind that they don’t have to worry about the appraisal. Failing that a larger down payment will allow for many appraisal issues to vanish.

Filed Under: Buyers Resources, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, Doorpath Team, foreclosures, home appraisal, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, short sales, Somerset County

Wider Choices Greet Central New Jersey First-Time Home Buyers

May 7, 2013 By Mike Downer Leave a Comment

The concept of “starter homes” cropped up after the end of the Second World War, when millions of young families took advantage of low-cost new developments to gain a foothold in homeownership: the emblematic first step in fulfilling the American Dream.

Today’s first-time Central New Jersey home buyers are a lot less predictable—just as the market itself is altogether different. As we recover from the previous years’ economic declines, which temporarily suppressed the number of area home buyers, the combination of low interest rates and historically affordable home prices allows many to aim for bigger and more accommodating housing— skipping the starter home altogether.

For sure, the market hasn’t completely abandoned the starter home idea—especially if you include Central New Jersey REO and foreclosure fixer-uppers as financially rewarding targets for handy young householders. The FHA 203(k) loan, which includes a built-in “limited repair” budget, can enable that route. But new home buyers also find other prospects can be newly within reach— among them, larger older homes and newer condominium and townhome choices.

If the combination of bargain prices and low mortgage rates isn’t enough to call prospects to action, the clear trend toward rising prices may do the trick. As inventories of the best bargains begin to shrink and mortgage rate rises look more and more inevitable, Central New Jersey home buyers could well imagine a ‘tick-tock’ sound growing louder. For area sellers waiting to make a move upward on the housing ladder, the same conditions could well make this spring’s real estate market the one they’ve been waiting for.

It all means that prospective home buyers in Central New Jersey stand to be rewarded by keeping an open mind about the variety of properties they may now find within reach. By seeking the help of an experienced agent, the widest choice of possibilities will be open for consideration. If you are looking for the area’s most up-to-date market advice, I’m here to make sure you have access to the tools you need to make the right decision—the first time around, and every time after!

Filed Under: Buyers Resources, Investment Property, Sellers Resources Tagged With: 203K loan, Central New Jersey, Coldwell Banker, Doorpath Team, FHA, foreclosures, Hunterdon County, investment property, land sales, loan modification, low mortgage rates, Michael Downer, Middlesex County, new construction, Realty Trac, REO, short sales, Somerset County, starter homes, world war two

Web Appeal is Central New Jersey’s New Curb Appeal

May 6, 2013 By Mike Downer Leave a Comment

Remember the days when you didn’t have to rummage furiously through the house to find a ringing phone, because it stayed where it was supposed to be—plugged into the wall? You remember: it used to take less than 10 minutes to check out the TV listings because there weren’t hundreds of channels. And a gallon of gas cost less than a loaf of bread…

Of course, those days are long gone. Unless you want to live on an isolated island somewhere in an underdeveloped country, that’s that.

In the real estate profession, the good ol’ days are gone, too. When I’m helping a client sell his or her home, I make the most of the fact that the super-highway to today’s buyer is no longer the newspaper or snail mail. It’s the Web.

It’s the listings.

The first glimpse potential buyers get to any property is most often found through our Central New Jersey real estate listings. Those attention-grabbing real estate listings are the agent and seller’s best chance to attract an in-person visit—with all that follows.

So how do you help your agent ace the area real estate listings?

As in preparing for any performance: set the stage!

Photographs are your best listings allies, so “stage” the house before photography begins. Professional photographers know that the viewer’s eye will be attracted to any out-of-place detail: a dog bed in a corner, or one window with a blind pulled lower than the others will create a distracting element. What looks okay in real life is much less critical.

Savvy buyers will peruse real estate listings in Bridgewater for instance online before scheduling visits. They save time, effort, and expense—and for those not committed to a specific area, the wealth of information published online about the community helps narrow their search. If you’re looking to sell your house, be sure your listing catches the attention of those serious and educated buyers. They’re the ones who are likely to write an offer.

Ready to set the stage for a successful sale? I’d love to prepare a marketing plan for you this spring!

Filed Under: Buyers Resources, Central NJ Property Information, Home Improvement, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, curb appeal, Doorpath Team, foreclosures, Home Staging, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, real estate listings, short sales, Somerset County, staging, web appeal

Features That Set Central New Jersey Luxury Homes Above the Crowd

May 5, 2013 By Mike Downer Leave a Comment

Some Central New Jersey luxury homes are so distinctive that they stubbornly resist fitting into any simple category. Whether due to unusual architecture or unique geographical features, such properties remain in a class of their own.

But for most other homeowners preparing to sell their luxury homes in Central New Jersey this spring, some baseline features are close to must-haves. According to Morgan Brennan of Forbes.com, “It is almost a given,” that listed multimillion dollar properties will claim certain features.

Top-of-class luxury homes almost always include a pool. In fact, many traditional homes now offer this feature as well (sometimes labeled a “luxury” addition). That being the case, the pools that appear in luxury home listings often sport a bonus feature or two. That may be a hot tub, waterfall, or other creative design element like infinity edges or outdoor bars and TVs— always attractively designed.

Today’s Central New Jersey luxury homes may not seem luxury enough without a richly appointed home theatre: one with the additional media features that take television and movie viewing to a new level. True home theatres come equipped with plush seating, multi-channel surround sound systems, or even (why not?) classic velvet curtains to part when the movie begins.

Many luxury homes do not just have walk-in closets for the master bedroom—they may also include them throughout the house. Since their owners usually have extravagant budgets when it comes to shopping, you would hardly expect standard-sized wardrobe arrangements to suffice. Luxury homes in our area may have closets equipped with complete dressing facilities, including full-length mirrors and individual powder rooms.

These features are predictably popular with prospective buyers of Central New Jersey luxury homes, but the whole package also needs to be presented properly: savvy marketing remains the key to a successful sale. If you are poised to offer your own home, contact me to discuss how a distinctive marketing plan can make yours one of this spring selling season’s success stories.

Filed Under: Home Improvement, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, Doorpath Team, foreclosures, home theatre, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, pool, short sales, Somerset County, walk in closets

Central New Jersey Short Sale Option: Action Steps

May 3, 2013 By Mike Downer Leave a Comment

A short sale is the option usually preferred by anyone who faces foreclosure. It’s the path that, with the approval of the mortgage lender, promises to ultimately minimize damage to the homeowner’s credit score.

According to Realty Trac, distressed sales of all kinds continued to decrease in the last reported quarter, yet the non-foreclosure short sale volume increased by 4%. That amounts to a significant 22% of all sales. Realty Trac’s are the most reliable national statistics, and our Central New Jersey short sale profile has likewise reflected the continuing working out of the distressed property phenomenon.

Completing a short sale in Bridgewater (or anywhere else, for that matter!) can be challenging. If you’ve decided that it is your best course, you can do a lot to help your agent accomplish it:

From the beginning of the short sale process, keep your agent informed of any changes in the financial picture. That means keeping up-to-date on the changing balance remaining on the mortgage, as well as the number of missed payments. When the information is at hand, your agent can impart the sense of urgency that gets your home sold as fast as possible.
The speed of sale is important, yet while a Central New Jersey short sale specialist is an expert in that arena, other important details regarding taxation and the law may influence the best overall strategy. By encouraging your real estate agent to work alongside an experienced attorney or tax specialist, you will form a team that can execute your short sale package more efficiently than if they worked independently.
Executing a short sale means meeting multiple demands—each with its own timing requirements. That can mean a lot of pressure: but if your agent asks you to do something or provide additional information, stand ready to do it! That speeds negotiations with buyers and lenders, increasing the chance that you will successfully close your short sale.

Short selling a home is a somewhat complicated process. I offer a no-obligation, in-home consultation to help assess your circumstances and the next steps to consider.

Filed Under: Buyers Resources, Finance, Investment Property, Sellers Resources Tagged With: Central New Jersey, Coldwell Banker, Doorpath Team, foreclosure, foreclosures, Hunterdon County, investment property, land sales, loan modification, Michael Downer, Middlesex County, new construction, Realty Trac, short sale, short sales, Somerset County