The Real Estate Market in Northwestern Michigan.

We are definitely in the full swing of the “seasonal” real estate market.  We have seen an increase in activity in purchases of first time home buyers and vacation home buyers (there are some great deals in both of these segments - actually in all segments!).   Interest rates remain low, sellers are willing to negotiate.  NOW IS THE TIME TO BUY.  For those of you that think we have not “hit the bottom of the market” - you are going to miss out!!  

Sold Market Analysis April 2008: 

Total Listed 638; Total Sold 161; Average List Price Sold $200,219; Average Sale Price Sold $186,473; Average Days on Market 161

 

Tame Inflation Data Turns Rates Lower

Mortgage rates ended the week close to where they began the week, but the end result masked a lot of movement. The week began poorly for mortgage markets. Stronger than expected Retail Sales data and tough talk on inflation from Fed officials pushed mortgage rates higher on Monday and Tuesday. In particular, Tuesday’s Fed speakers suggested that the economy was beginning to recover - even if there is still a long way to go - and that inflation concerns have increased. The tide turned on Wednesday, however, when CPI, the most closely watched inflation report of the month, showed a lower than expected increase in inflation. Mortgage rates fell every day through the remainder of the week.

The April Core Consumer Price Index (CPI) rose at a 2.3% annual rate, below the consensus forecast of 2.4%. So far, higher food and energy prices have not been passed through in a large way to the prices of other goods. The Fed has been emphasizing inflation fears for a couple of weeks, which has had a negative impact on mortgage markets, so the good news on inflation was a relief to many investors. The Fed is generally considered to be comfortable with Core CPI readings below 2.5%.

In the housing sector, this week’s news was mixed. Against a consensus forecast of 940K, April Housing Starts rose 8% to an annual rate of 1,032K units. Building Permits, a leading indicator of housing market activity, rose 5%, the first increase in in five months. The construction of single family homes remained weak, however. The strength in the Housing Starts report came from new apartment construction, which is extremely volatile on a monthly basis. Separately, the National Association of Realtors (NAR) reported that median home prices fell 8% during the first quarter from the same period one year ago. The chief economist of the NAR suggested that the data may be a little misleading, since a smaller percentage of high end homes were sold during the period due to the difficulty in obtaining jumbo mortgages. In addition, the results varied in different parts of the country. 100 out of 149 metropolitan areas saw price declines during the first quarter.

Compliments of Corey Phelps, Front Street Mortgage, (231) 360-7283, email: corey@frontstreetmtg.com

 

7 Reasons to own you own home…

1. Tax breaks. The U.S. Tax Code lets you deduct the interest you pay on your mortgage, property taxes you pay, and some of the costs involved in buying your home.

2. Gains.Even with today’s market, home-ownership is a good investment.  Right now, you can find some real good deals.  This market is going to change and now is the time to buy.
3. Equity. Money paid for rent is money that you’ll never see again, but mortgage payments let you build equity ownership interest in your home.
4. Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.
5. Predictability. Unlike rent, your mortgage payments don’t go up over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will rise.
6. Freedom. The home is yours. You can decorate any way you want and be able to benefit from your investment for as long as you own the home.
7. Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, you and your family establish lasting friendships, and offers your children the benefit of educational continuity.

To calculate whether renting or buying is the best financial option for you, use this calculator courtesy of Ginnie Mae: http://www.ginniemae.gov/rent_vs_buy/rent_vs_buy_calc.asp?Section=YPTH

For the listings in Northern Michigan, visit www.45thParallelRealty.net

The Price Must be Right.

1. Your home is most likely to sell for top dollar when it’s fresh to the market.

2. Buyers buy after they shop around. Buyers are in search of the best deal. If your home is priced too high, it will make the others look more attractive.

3. Your property will need to be appraised. If it appraises below the contract price you may have a problem.

4. Other than possibly location, price is the most critical item that both buyers & real estate agents look to when selecting homes to view.

5. If priced too high, it’s possible that no one will seriously consider or see the benefits of starting the negotiations.

6.  The more accurately priced the property is, the less likely the buyer is to start the negotiations with a “low ball” offer. 

 To view northern Michigan real estate, visit our website www.45thParallelRealty.net.