Home Sales Tick Up Another Notch

As regular readers know, we keep track of the national media spin on real estate matters because our Savannah home sales often reflects the tone we all pick up from the feel of the wider market. So let’s not beat around the bush: again in July, the residential real estate picture continued its rise. It has been sensible to remain cautiously optimistic about the direction of things for a good long while, but at this juncture, it’s finally beginning to look like a trend has taken shape.

“For the fifth consecutive month,” the Wall Street Journal reported in its news pages, “sales of previously owned homes notched another rise.” Savannah homeowners who have gone through literally years of sinking prices and moribund home sales must be worried as they read this –worried that someone will snap them out of this pleasant daydream. But it’s real: despite most of the other national economic news that remains considerably less encouraging, the real estate picture is heartening.   

The National Association of REALTORS^® agrees. They report that single family homes, condominiums and townhomes increased sales. Single family home sales rose 9.9% over last year, with condo sales jumping a full 14%.

A low inventory of homes for sale is believed to be at least partially responsible for strong new homes sales numbers. The nation’s biggest builder of luxury homes, Toll Brothers, reported a sales leap of 57% from last year. Meanwhile, the price picture showed the kind of growth you would expect: median prices were up over 9% from a year ago.

 

The median sale price in July for single family homes in 31405 was $187,200.
The sales prices increased by 1.18% from the previous month.
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Supporting trends were also interesting. Distressed sales (foreclosures and short sales) were down markedly, reflecting a tightening supply. This is probably an indication that the glut of such properties has finally worked its way through the market; certainly an encouraging sign for homeowners who have been waiting to list until the home sales market strengthens. The WSJ news story would likely provide some encouragement: they feature one would-be buyer who bid on a home, but lost it to a higher bidder. He and his wife had been viewing homes all summer before finally making their offer. “Maybe I stepped in a month too late,” he’s quoted as saying.

For Savannah homeowners who have been biding their time, that kind of quote will surely be music to their ears. If you have been watching and waiting for your own entry into the Savannah real estate market, I hope you will give us a call to investigate the latest comparables in your own neighborhood.  

MLS Listings Tell Shift in Area Homebuyer Values

The latest indications that we have seen the end of the sagging real estate market have started some Savannah homeowners thinking it may be time to sell. For those who are wondering if the long recession has altered how people look for homes – and if so, in what ways  – we’ve noticed a couple of new trends.

As before, the first stop for most potential buyers is the Savannah MLS listings. When you compare the language and features most prominent there, huge changes do not leap out. But a comparison with former language does reveal something of a shift in emphasis: many details that highlight opulence (to some, excess) are being replaced by features much more in tune with practicality and efficiency (to some, frugality). You would expect that, since consumer confidence is still less than robust.

The trend to open floor plans is nothing new: fewer walls; more living is an idea many buyers embrace. The more casual “great room” is almost always more desirable to today’s buyer than the formal living and dining rooms of 30 years ago. 

As the baby-boomer generation grows older, issues of accessibility and mobility become more important.  Savannah MLS listings that boast easy-access showers, baths, bedrooms and kitchens are highly desired and sought after by buyers in that populous group. Such listings signal a home already equipped for easy access -- meaning no extra dollars will be needed for retrofitting the property. Even for those who have no immediate need for those features, eliminating a future expense (even if it seems a distant concern) can be attractive.

Prominence is growing for features that relate to extra living space. The demographic reasons are clear: in-law apartments or bachelor studios have added value for families whose children may have to move back in with them (the “boomerang” effect).  Since such units may be rented for extra income in tough times, they bring an added element of financial security.  Large garages fall into this category as well (but no longer for that brand-new Hummer!)  Today’s MLS listings featuring an extra large garage are viewed as desirable by Savannah buyers looking to convert it into extra useable space: man-cave, gym, extra storage, or, increasingly, home office space.

Today’s homebuyer seems considerably more environmentally conscious than heretofore. Homes that feature solar panels, green toilets or other water-efficient plumbing, and radiant light windows are increasingly desirable. This may be due to growing social responsibility -- but I’d bet that reduced utility bills can’t be far behind. As a result, green technology features are working their way up in Savannah MLS listings. 

If you are looking to buy or sell a home in the Savannah area and would like to review where the latest trends point, give us a call!  As always, we’re here for all your real estate needs!

Boomer Generation Continues to Smash Expectations

We all know that many Savannah property searchers are looking for homes with more modern, high tech-compatible features. But something that is also interesting is evidence that the trend has broadened to include retirees who are in a downsizing, property-searching frame of mind.

From wireless availability to health monitoring systems, technology is one of the key hot buttons in the senior housing industry. "Many people are trading older houses for new [properties] that offer energy efficiency, great rooms, open floor plans,” according to Jane O'Connor, a specialist who studies trends in the 55-plus population. 

Although earlier studies found that most baby boomers preferred to stay in their current home as long as possible, those times are a-changin’. That attitude may have been typical for most of the last 50 or 60 years, but perhaps due to skyrocketing energy prices over the past few years, willingness to downsize and move is growing among retirement aged advocates.

Photo Courtesy of  www.123RF.com

As the publisher of Mature Living Choices magazine, O’Connor suggests other contributing reasons. “Boomers…were the first generation to question authority.  They changed everything they touched, from the creation of suburbs to mini-mansions.” Today’s retirees are also strong entrants into the virtual communities that the social networking explosion has created. They are using e-book readers, tablets, and other digital technology -- including online services like Skype and other video chat enablers. A decade ago, members of the senior sector were generally considered to be interested in (but in need of instruction regarding) the latest electronic communication devices. No longer. Especially given how particularly useful the new gizmos are for keeping in touch with children and relatives in other states, more tech-savvy seniors consider strong cable and internet access absolute necessities.

It seems like just yesterday when it was principally the 20-somethings who were wired. The senior population today can be nearly as high-tech as their offspring, and – when the time arrives to begin a Savannah area property search at the start of retirement - they expect to continue. It’s no wonder that assisted living facilities, retirement communities and nursing homes are also being required to have all the amenities of today’s connected world.

Whether you are one of the retiree generation setting out on your own property search, or a homeowner preparing to sell into this changing market, we’re here to assist in your plans. Give us a call anytime or begin your search at www.SavannahHomeSales.com

Psychology Helps Savannah Home Sales

When you choose the local real estate agent who will be your home-marketing partner, you are choosing someone who will need to fill many roles: marketer, stager, tour guide, negotiator.  And don’t leave out another role -- psychology major!   

 

To build our kind of successful track record, a real estate agent needs to study and understand the way prospective buyers think about their search for a future home, how they are likely to react to different forms of presentation, and what builds or detracts from the value they assign to your property. It’s psychology, all right -- and it’s usually an integral part of any sales or marketing success.

A good example of how psychology can affect a real estate transaction comes from a study done at the University of Texas. There they have a Real Estate Finance and Development Program. A couple of years back, they began conducting some psychological studies, and one of them used sophisticated statistical tools and a huge sample of real estate transactions.

What’s fascinating is what they discovered about using the word “new.” Real estate agents who marketed homes with phrases like “new paint,” “new carpets,” and “new roof” wound up selling them for slightly less than those who did not!  

The study’s explanation is that, for homes that are not brand new, touting “all new” features seems to call attention to the fact that the items mentioned needed to be replaced. It unnecessarily opened the door to suspicions about what went wrong that made replacement necessary.

A more effective strategy: under-promise and over-deliver. Rather than trying to convince buyers how “new” an older home is, do the renewal work, but don’t brag about it.  Then when potential buyers walk into the home, they will be impressed by the new carpets and fresh paint.  It’s the approach that uber-successful Zappos company founder Tony Hsieh calls “surprise and delight.” What is effective for leading a company and retaining customers can also be psychologically effective for selling a local home.

As a leading real estate company in our community,  we are constantly reminded of how important it is to never stop learning. If you are considering selling your home and are looking for cutting-edge marketing and advice, we hope you’ll contact us for a complimentary consultation.

The Right Contractor Gets Your Job Done

We have all heard horror stories about what can happen when people hire the wrong contractor. “It took three times as long as it should have!” “They wound up charging me half again what they said it would cost!” “They never even called me back!”

Those kinds of tales can be enough to keep you from even considering starting any of the home improvement projects you may have been thinking about for this summer. But that doesn’t need to happen – and it shouldn’t happen: protecting and improving your real estate investment is too important to your financial future. Sometimes the difference between a successful outcome and a disappointment is as simple as getting started the right way. Just three simple steps (combined with your own good common sense) will get your own Savannah real estate improvement project off on the right foot:

1. Get Recommendations

Most important is the first step: get recommendations. Trusted real estate agents usually know some of the most reliable local contractors (We always have a few recommendations or know where to point you to get them.)  Take enough time to collect as many names as possible. Friends, family, neighbors, co-workers – even the local hardware store proprietor -- can offer names and first-hand experiences. Then check reputations: use the Better Business Bureau for their accreditation, and see what people on the Internet have to offer (though you should always take Web gossip with a grain of salt!). Usually the best recommendations come from people you know who relay their own experiences, good or bad.

2. Meet Each Contractor

You are looking for a licensed professional who does excellent work on time and on budget.  After creating a short list of contractors, take the time to meet each of them at your house. The contractor can then give you a written estimate of how much the work will cost you and how long it will take.

3. Double-Check

After you have settled on a final candidate or two, don’t be shy about asking to speak to a couple of recent clients about their experiences. It’s not unreasonable to ask; after all, if your job gets done on time and on budget, won’t you be willing to answer a phone call or two? 

If you want a stress-reducing way to protect and improve your real estate investment, hiring a great contractor is the vital first step.  As your Savannah area real estate professionals, we will be happy to steer you in the right direction when it comes time to work on your home – don’t hesitate to call!

Why Experts Urge The “5-Year Rule”

Even some veteran renters are looking at today’s housing market and wondering whether it’s time to start a home search. With prices and mortgage rates as low as they are while rents continue to move higher, the numbers point to home ownership as an ever more obvious choice.

But that’s just the quick, back-of the envelope budget equation: monthly rent vs. mortgage payment less tax savings. If this June finds you at the start of your own Savannah home search, many financial advisors recommend that you also consider another rule of thumb – you should plan to stay in your new home for at least five years.

Transaction costs are only one consideration that makes this a good idea. Here are some of the others why it’s prudent to think about the 5-year planning horizon as you conduct your home search:

Financial Safety - Homeowners need to have at least some extra liquidity: funds set aside as an emergency resource in the event of unforeseen loss of income. Affording a home and its maintenance costs should never jeopardize the financial health of your household.  Liz Weston of MSN.com recently asked several experts for their calculations regarding home repairs. Their answer? Plan to spend at least an additional 1% of a homes’ value on maintenance each year.

Resale Value - The significant overhang in distressed homes will likely continue to exert at least some pressure on home values for the near future. If you need to sell your home two or three years down the road, you may come up short when all the moving, transaction, and other expenses are considered. It may be at least that long before the familiar growth in residential real estate value resumes. 

Sanity – Studies have shown that moving is one of the top stresses in life (up there with death, divorce and illness). Personally, I think a well-planned move is a little less dire, but it is true that a happy homeowner is a settled homeowner.  When you’re starting your home search, consider the changes coming to your family in the coming years: New baby?  Child to college?  If you know a move is eminent in the near future, consider finding a home with long-term rental value.  Buy a home that can grow with you and you’ll find yourself much more financially secure…and sane!

The current low prices and 30-year fixed mortgage interest rates aren’t likely to last forever, and that old adage remains true: buy low, sell high.  If you’re looking for a reason to start your home search in Savannah now, call for a serious look at this June’s market.  

Survey Nails Outdoor Living Trends

Those of us who focus professionally on our Savannah real estate trends can vouch for it: outdoor living sells! And depending on what life phase their family is in, homebuyers’ choices tend to follow similar lines.

The 2012 Residential Landscape Architecture Trends Survey confirms again how important those backyard grills and dining areas are when it comes to what most people have at the top of their minds when they think about buying homes.

When potential homebuyers come to us, some of the features highest on their “must have” list virtually always have something to do with outdoor space.   Young families buying homes, for example, are usually pleased to find a grassy area off the kitchen where their toddlers can toddle.  High-profile clients often seek out impressive spaces with great foot-traffic flow for indoor/outdoor entertaining.  Empty-nesters buying homes often come to us seeking the opposite -- less yard with easy- or no-maintenance landscaping.   The point is, no matter what the age or demographic of the buyer, in today’s market, outdoor space sells.

So -- what is hot for those buying homes in 2012? The survey cited earlier is one conducted every year by the American Society of Landscape Architects. This year they came up with some clear winners. According to the survey, top popularity goes to BBQ grill space (97.4%), followed by low-maintenance landscapes (96.6 percent), fireplaces/fire pits (95.8 percent), and dining areas (95.7 percent). 

Not so obvious winners were decorative water elements such as ornamental pools, splash pools, waterfalls, grottos, water runnels or bubblers, and pergolas. Not as popular as they once were? Turf lawns at 50.9%, gazebos at 49.1%, and hammocks at 27.4%.  Go figure!

If you are considering an outdoor remodel before selling your own home, be sure to design with Savannah buyers in mind. Contact us any time for a stop-in -- we’ll be happy to go over the features most clients look for when buying homes today.