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The latest news about the real estate market this holiday season.
Happy holidays! Thank you for putting your trust in our team. I also want to give you a quick update on what’s happening in the market. There are so many doom and gloom headlines. While they might reflect some parts of the country, real estate markets are very local. Even from one city to another nearby, there can be vast differences.
Right now, homes are still selling, however, the supply of available houses is still low. We have half a month of active inventory. Even if you include the listings with accepted offers, we still only have one month’s supply. A balanced market would have about six months of inventory, so this is still a seller’s market. If you’re a buyer right now, you’ll benefit from not much competition. Only serious buyers want to go look at houses when the weather is like this.
This may be a busy time of year, but we are always here to help you and answer any questions you may have. Give us a call or reply to this email; we’d love to help you. In case we don’t hear from you until 2023, have a happy New Year!
Here are six tips that will get your home ready for the winter season.
How do you get your house ready for winter? Leaves are almost all down, and winter’s on its way. While there are probably a few nice days left this year, it won’t be for long. Now is the perfect time to get everything ready for the winter. Here are a few things that I recommend you should do before the snow falls:
1. Take your hoses off your outdoor faucets. Drain them and store them. The older-style faucets or spigots can be shut off from the inside of the house, while the newer ones have a valve that shuts when you turn it. This way, they’ll be less apt to freeze unless it’s extremely cold.
2. Clean the gutters. Once the leaves are all down, get all the sticks and debris out of your gutters so you won’t have issues with water freezing in there and clogging the drain. If you leave it unattended, this could lead to a problem with ice damming and cause damage to your house.
3. Make sure your snow blower works. If you have a snow blower, make sure that it runs correctly.
4. Winterize the lawn mower. Once you’re done with the final mowing of the lawn, it’s time to winterize the lawn mower. Put it in the back of the garage, and move your working shovels up front. You may also want to pick up some ice melt or some sand if you don’t have any.
5. Check your smoke detectors and high-low vents. It’s always a good idea to regularly check your smoke and carbon monoxide detectors. Replace the batteries if necessary, and make sure that they work properly. Also, don’t forget to routinely check your high-low vents.
6. Set up your holiday decorations. If you have plans to decorate for the holidays, do it now before it becomes too cold to go outside.
For any questions about this topic or anything related, call or email me. I’m always happy to hear from you!
Four reasons why homeowners should consider selling in the fall.
I’m sure you’ve heard that spring is always the best time to sell your house. While spring is traditionally a good time to sell, each other season also has its advantages. Here are a few reasons why you should consider selling in the fall:
1. Inventory. There’s less inventory in the fall compared to the spring and summer months. While there may be fewer buyers out there, you’ll also have less competition.
2. Buyer quality. The buyers during this time of year are typically more serious than those out on a nice day looking at an open house or touring homes to get decorating ideas.
3. School and weather. Summer vacation is over now, and kids are back in school. The weather is also very nice this time of year.
4. Autumn marketing. Fall décor will look great in the photos of your house. A cozy house is very inviting.
If you have any questions about selling or listing your house, please reach out to me at (608) 212-5743. I look forward to helping you.
Here is everything you need to know about the Dane County market in August.
What is happening with the Dane County market? Things are changing in our local real estate, and we have the latest data for you here today.
In our entire market, we’ve seen sales decrease for the seventh consecutive month by 6%. In Dane County specifically, we’re down by 7%. This has helped to stabilize prices in the county, which are holding steady at just below $400,000. That’s 12.6% higher than it was in 2021. Year to date, the average price is $428,488—an increase of 10.2%.
While these prices have been decreasing, inventory is still a pressure point. Over the last year, inventory has decreased. In Dane County alone, we’ve seen a decrease of 25% in new listings from August 2021 to now. From January 2021 through today, available inventory has decreased more than 11%. We’re seeing a low availability of only about a month of inventory across Dane County. In contrast, we’d expect to see about six months of available inventory in a balanced market. This implies that we are still in a great seller’s market.
Interest rates have also been increasing.* Today, we’re sitting at 6.875% for a 30-year fixed mortgage—quite high compared to our previous rates of just under 3%.
The average number of days on the market was about 15 instead of the 14 days in August 2021. We think this trend will continue, with properties staying on the market longer.
Thinking about buying or selling and need my help? Please don’t hesitate to give me a call or email. I’d be happy to answer any questions.
* Note: Interest rates have subsided to 6.5%. Interest rates are volatile and since shooting we have seen a slight decrease.
You have options to safeguard yourself from fluctuating rates.
The Federal Reserve has increased rates multiple times this year so far and will continue to do so throughout 2022. That means if you’re in the process of buying a home, the rate your lender quotes could increase sometime in the future. So what happens if interest rates increase after you’ve already gone under contract? Is there any way to protect yourself?
First of all, when we’re writing an offer with a financing contingency, we typically determine whether your rate is fixed or variable and what terms would allow you to cancel the contract. In a rising market like this, you should get a mortgage rate lock as soon as possible in the process to prevent your rate from increasing further. Some lenders have products that let you lock before your offer gets accepted, but you may have to pay a higher interest rate to do this.
Second, ask your lender if they provide float-down options, which prevent your rate from rising but allow it to lower if market rates begin to fall again. Be advised, though, that float-down options typically come with an extra cost in exchange for a lower rate.
If you have any questions or would like to learn more about mortgage rate locks and float-down options, don’t hesitate to give me a call or send an email. I’d be happy to help you.
Are you planning to buy a condo? Here’s what you need to know.
I’ve recently been working with a few clients who want to purchase condos and then rent them out as a part of their real estate investment. It’s a great way to generate wealth but condos are not exactly like houses. If you want to pursue this route, there are a few key differences between the two you’ll need to know.
You can listen to my full explanation in the video above or skip to each topic using the timestamps provided:
0:00 — Introduction
0:34 — Condos are governed by more rules
0:49 — Many condo associations have rental restrictions
1:35 — Renting out your condo can drive down your property’s sales price
1:50 — The condo association typically takes care of the maintenance of the condo building
2:31 — There is typically a monthly condo fee you’ll have to pay
2:56 — What you own when you buy a condo
3:42 — Learn the scope of your ownership and responsibilities
3:57 — A Wisconsin law when buying a condo
5:52 — Wrapping up
If you need more details about this topic or have any real estate concerns, don’t hesitate to call or email me. I’ll be happy to help!
An update on the Madison housing market and what it means for you.
The national housing market is changing drastically—so what does that mean for local markets? Today I have an update on the market specifically in the Madison, Wisconsin, area. Overall, we have seen days on market, prices, and inventory increase, but the number of showings has decreased.
One huge thing is that rising interest rates have put pressure on affordability. Every 1% increase in interest rates raises your monthly payment by about 10%. Plus, rising prices aren’t just affecting real estate; the cost of groceries and gas are climbing too. This means the cost of living is going up, which is putting a strain on many buyers’ affordability.
Secondly, there are around three weeks of available inventory in our area, which is more than just a few months ago. However, even though inventory is rising, it’s still historically low—a balanced market has about six months of inventory. Between this and the rising costs, it is clear that we are still in a seller’s market.
If you want more information about what the market is doing now, or if you’re thinking of buying or selling a home, please reach out to me by phone call or email. I’d love to chat with you and discuss the specifics of your situation!
Four ways to make your offer more competitive in multiple-offer situations.
Today’s real estate market is still competitive for buyers. If you fall in love with a home, chances are that other buyers have seen it as well, and you’ll have to compete against them to get your offer accepted. Even though interest rates have increased, there still aren’t enough homes to balance out our market. That means sellers have the upper hand, and buyers are forced to compete against each other. Fortunately, there are a few ways you can make your offer stand out to sellers:
1. Offer above the asking price. You’ll have to offer more than asking price if you want to win in a multiple-offer situation, but that doesn’t mean you’ll have to bring too much more money to the table. An extra $2,000 might be enough to draw the seller’s attention. As long as you don’t offer far more than the asking price, this shouldn’t change your monthly payment that much.
2. Limit your inspection. Many sellers worry about deals falling apart because of issues during the inspection. However, if you waive your inspection entirely, you could be on the hook for costly repairs. Instead, you can limit your risk by reducing the inspection period or agreeing to only ask for major repairs.
3. Cover the appraisal. With home prices rising so quickly, many houses aren’t appraising for their final sales price. Normally, the buyer and seller would negotiate to see who’s responsible for the difference. However, you can make your offer more attractive by agreeing to cover a potential appraisal gap. If you’re already fully underwritten, you can waive your appraisal contingency entirely. If not, then you can offer appraisal gap coverage, which is where you’ll cover any gap up to a certain amount you choose.
4. Be flexible. Sellers might want different things concerning the timing of their sale. You can work with the seller’s agent and either offer an extended closing or a quick closing to coincide with the seller’s needs. Doing so can help your offer stand out to the seller. To sweeten the deal even more, you can also offer a leaseback agreement or post-occupancy period, where you let the seller stay in their house after closing to give them time to move and/or find another house. These agreements usually last for anywhere up to 60 days and can be a great way to offer your seller a flexible closing.
If you’re tired of competing, have hope. Interest rates are rising, and it looks like the competition from buyers is easing up slightly. While we still expect to see a seller’s market for a while, it may get easier to purchase a home in the coming months.
If you’d like to take a look at what’s presently available on the market, you can view our multiple listing service here:
Click here to see all available homes in your area.
If you have any questions about making your offer more competitive or buying homes in general, feel free to call or email us. We would love to help you navigate this market.
What can you do if a home doesn’t appraise in this crazy-hot market?
In the Madison market, inventory is incredibly low. As a result, competition for homes is fierce, and prices continue to rise. When you want to buy a home, the bank or your lender order an appraisal to make sure the house’s true value supports the amount you’re paying for it. This usually isn’t an issue; however, when prices are rising so quickly, homes often don’t reach the agreed-upon price during appraisal. What can you do in this situation to make sure the deal doesn’t fall through?
In our current market, many buyers deal with this situation by skipping the appraisal altogether. They do this by either offering all cash or waiving their appraisal contingency. Unfortunately, this isn’t an option for everyone.
If you can’t waive your appraisal contingency, your real estate agent can help you dispute a low appraisal. The appraised value is supposed to be what the true market value is. If your agent can make a convincing case that the home is worth what you’re paying for it, you can successfully win your dispute.
Often, we’ve found that multiple-offer situations are a good piece of evidence to show an appraiser. Home values are increasing rapidly, so the more recent the data, the better. If you can prove that others were willing to pay a similar or identical price for the property, you could win your dispute.
This is a complicated topic, so if you’d like to talk about it, please call or email us. We are always willing to help!
Here are the top three remodeling projects in terms of return on cost.
When it comes to remodeling your home, which projects stand the best chance of getting your money back when you sell? Sellers often ask about home upgrades, so today I’ll talk about the three that will get you the biggest bang for your buck according to data from Remodeling Magazine. You can look over their Remodeling 2021 Cost vs. Value Report for 2022 here. These are the top three according to the report:
1. Garage door replacement. According to Remodeling Magazine, replacing your garage door has the No.1 return on cost, with a national average of 93.3%. It’s definitely a good way to increase your home’s curb appeal.
2. Installing manufactured stone veneer. Putting stone veneer on the outside of your home will spiff up your curb appeal, too. On average, you’ll recoup 91.4% from the project.
3. Minor kitchen remodel. On a full kitchen remodel, you’ll get about 50% of your money back when you sell. A minor kitchen remodel, however, will bring you a 71.2% return.
If you’re thinking about doing any remodeling, I encourage you to talk to your Realtor and get some estimates on the projects you had in mind. If you’d like my advice or have any questions, don’t hesitate to give me a call or send me an email. I’d love to help you.
© 2021 Zonda Media, a Delaware Corporation. Complete data from the Remodeling 2021 Cost vs. Value Report can be downloaded free at www.costvsvalue.com.
