I just got through going through some stats (I’m a stats freak) concerning the market and was really surprised at what I found.
Going back the last 90 days (for homes sold) and taking into account which homes are currently under contract, it seems to me that the sweet spot right now is the $60K – $140K price range.
That’s surprising because about 8 months ago I looked at the same numbers and the price range that was hit hardest with slow sales was the $75-$125K spread.
So what’s changed in the last 8 or so months?
Last year the banks really tightened up on lending and I know for a fact that many first time home buyers were not able to obtain financing. The zero down loan programs started to dry up and knocked out those folks with little or no money and questionable credit.
Now, with that being said, the lenders are still tight compared to 3 years ago, but with the lower interest rates and the new tax credit that first time home buyers can receive (up to $7,500) from the IRS, first timers are making their way through the front doors of mortgage lenders.
You can’t forget about one important change that’s happened in the last 8 months though… Gas prices. Today, they’re less than half what they were last summer. The gas prices really put a crunch into folk’s pocket books (mine included). Now that the prices have subsided and appear to have stabilized somewhat, may people are looking to buy/invest (or, at least, they’re thinking about it) again.
If you ask me, we’ve got a good idea of what $4.oo+ gasoline can do to this country, and it’s not pretty. But back to the Waco real estate market… if you’re selling your house or, at least, considering it, ask your real estate agent about the market. Don’t settle for “Hey, it’s not bad” or “Well, it could be better”… try to get some specifics from him/her/them. If you’re listing a house in Midway ISD that’s $400,000… You’re agent needs to break it down for you so you get an idea of what’s going on. How many months of inventory of $400,000+ homes do we have? Average days on market? What’s selling right now? What about values?
Especially right now, the real estate market is pretty tricky and it pays to be informed.
If you’re selling your house and it’s about $100,000 (the actual market value… NOT what you hope to get for it), according to my stats… You should be doing okay (well, for today, at least).
I just wonder if the first time home buyers really come out in strong force (so to speak) this spring looking for homes. After all, if they want the tax credit, they need to close before July 1st.
If you have questions about the tax credit… you can download this FAQ: $7500 Tax Credit
Oh by the way, I’ve failed to mention in any of my previous posts, for those buyers who are seeking an FHA loan, the minimum down payment has gone from 3% to 3.5%…. A new rule that went in effect on January 1st.
