U.S. Buyers Pay Closer to Listing Price in August, Still Negotiating Thousands in Discounts

October 11, 2009

Home buyers in much of the U.S. are still paying thousands of dollars below the home’s asking price, but had slightly less negotiating power in August 2009 than they did in July, according to the August Zillow Real Estate Market Reports. Buyers paid a median $6,525, or 3% less than the last listing price on homes bought in August, down from $7,018, or 3.3%, less for homes bought in July. Negotiating power peaked in January 2009, when buyers were paying 4.5% less than last listing price, a median of $10,096. Meanwhile, sellers continue to cut prices on unsold homes. One quarter (24.7%) of all homes listed for sale on Zillow had at least one listing price reduction as of Oct. 1, 2009. The median U.S. price reduction was 6.6% off the original listing price.House

Florida home buyers again in August had the most negotiating power, with buyers in the Vero Beach metropolitan statistical area (MSA) paying 8.9%, or a median $20,974, less than the last listing price. Buyers in the Naples MSA paid 8% less than list price. The Naples, Daytona Beach, Miami-Fort Lauderdale, Ocala, Lakeland, Punta Gorda, Melbourne, Gainesville, Tampa, Jacksonville and Fort Myers MSAs also ranked, in that order, as the top markets for negotiation.

But in two California markets, buyers paid more than asking price during August. In the El Centro MSA, buyers paid 2.2%, or a median $2,479, more than asking price. In the Stockton MSA, buyers paid 1.3%, or $2,515, more.

“Negotiating power is a clear reflection of inventory levels, which dropped nationally in August. Tighter supply in some markets is translating into less of a discount off listing price,” said Zillow Chief Economist Dr. Stan Humphries. “Unfortunately, the brisk spring and summer home shopping season is drawing to a close now, and with foreclosures on the rise again, inventory levels will likely head back up in the coming months, leading buyers’ negotiating power to regain the ground it lost in August.”

For more information, visit www.Zillow.com.

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Zillow: U.S. Home Buyer Negotiating Power Falls in August

October 8, 2009

Home buyers in much of the United States paid thousands of dollars below the asking price, but had slightly less negotiating power in August than in July, real estate website Zillow.com said on Thursday.

According to the Zillow Real Estate Market Reports, buyers paid 3 percent less, or a median of $6,525 below the listing price on homes bought in August, down from $7,018, or 3.3 percent, less for homes bought in July.

Buyers’ negotiating power peaked in January, when buyers were paying 4.5 percent less than last listing price, a median of $10,096, Zillow said.Piggy

Meanwhile, sellers continued to cut prices on unsold homes. One quarter, or 24.7 percent, of all homes listed for sale on Zillow had at least one listing price reduction as of October 1, 2009. The median U.S. price reduction was 6.6 percent off the original listing price, the reports showed.

Florida home buyers again in August had the most negotiating power, with buyers in the Vero Beach metropolitan statistical area (MSA) paying 8.9 percent less — or a median $20,974 — than the last listing price. Buyers in the Naples MSA paid 8 percent less than list price.

The Naples, Daytona Beach, Miami-Fort Lauderdale, Ocala, Lakeland, Punta Gorda, Melbourne, Gainesville, Tampa, Jacksonville and Fort Myers MSAs also ranked, in that order, as the top markets for negotiation, Zillow said.

But in two California markets, buyers paid more than asking price during August. In the El Centro MSA, buyers paid 2.2 percent, or a median $2,479, more than asking price. In the Stockton MSA, buyers paid 1.3 percent more, or $2,515, the reports showed.

“Negotiating power is a clear reflection of inventory levels, which dropped nationally in August. Tighter supply in some markets is translating into less of a discount off listing price,” Stan Humphries, Zillow chief economist, said in a statement.

“Unfortunately, the brisk spring and summer home shopping season is drawing to a close now, and with foreclosures on the rise again, inventory levels will likely head back up in the coming months, leading buyers’ negotiating power to regain the ground it lost in August,” he said.

Source: Reuters

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Refinancing Your Mortgage – Is It The Right Choice For You?

September 17, 2009

Mortgage refinancing is an option for many homebuyers who are paying interest rates 2-3% or higher than what they can find today, or who need additional cash. Were you a first time homebuyer or you had poor credit the last time you obtained a loan? Now you are on your feet and make a salary that could help you receive the best interest rates. Possibly you are looking to refinance your mortgage so you can free some funds for a new car or for educational purposes. There are many options available when you refinance.

Before you decide if refinancing is right for you, look at your current financial situation. Do you have an adjustable rate loan or a fixed rate loan? How long do you plan to be in your home after you obtain your new mortgage? What is your ultimate goal? Most people want to refinance so they can access more money now. Refinancing is a great solution, but is a refinance of your loan the right solution for you?

The first step is making contact with you lender, and be aware how much your monthly payment is now. It is also helpful to find out how much you have paid of your mortgage towards principal. Since you will refinance the amount left on the mortgage principal, and not refinance the original mortgage amount, it is really important to know how much principal is left. If you plan to stay in your home for a length of time and still have a sizeable principal left on your loan, then a mortgage refinance may be a good option for you if interest rates are lower than when you obtained your last loan.

Just as with most conventional loans, refinancing offers similar options of adjustable and fixed rate mortgages and anywhere from 10-40 year loans. Be sure to review with your mortgage lender the reasons you are interested in refinancing; do you need to refinance to obtain cash for home improvements or for a new car purchase? These are important factors to make your lender aware of as you are deciding how to refinance your mortgage.

Mortgage

Another factor that determines whether borrowers refinance is interest rates. Current mortgage interest rates can rise and this often scares refinance borrowers who have ARMs because they are afraid the adjustable rates will rise after they refinance. It is difficult to assess what will happen to the adjustable refinance mortgage interest rates over the next few years. If you refinance into a fixed rate mortgage during a high interest rate period, then when interest rates go back down, you are stuck with a high fixed rate mortgage and another decision about whether or not to refinance again. Of course the only sure-fire way of knowing if you should apply for a refinancing is to assess your reasons for the refinance and how it will affect you in the future.

Source: Real Estate Global Network

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Quality of Home Construction on the Rise

September 15, 2009

Builders may not be putting up as many houses as they did during the boom, but what they are building, they’re building better.

According to the J.D. Power and Associates 2009 U.S. New-Home Builder Customer Satisfaction Study, overall customer satisfaction increased for the second consecutive year, up 32 points to 811 on a 1,000 point scale.

Satisfaction with the quality of the home also grew, to 825 up from 799. The rate of customer-reported problems dropped to 9.55 problems per home down from 11.51 problems in 2008.

“Fierce competition among home builders has led to a market where only the strongest companies have survived,” said Paula Sonkin, vice president of the real estate and construction industries practice at J.D. Power and Associates. “This is great news for new-home buyers — particularly first-time buyers — since builders are offering unprecedented high levels of quality, value and service at relatively low prices.”

Various California markets, plus Phoenix and Tampa, Fla., recorded the greatest gains in overall satisfaction. Those are all markets hit hard by the real estate bust and they have lots of unsold inventories.

construction

J.D. Powers rates satisfaction on nine criteria: workmanship/materials; builder’s warranty/customer service staff; price/value; builder’s sales staff; construction manager; home readiness; recreational facilities provided by the builder; builder’s design center; and location.

The quality of workmanship and materials has become significantly more important to consumers, the study found, while the construction manager and readiness has become less of a concern.

“Fewer home buyers are spending large amounts of time working with construction managers or are concerned about home readiness, since many builders have large inventories of homes that are already complete at the point of purchase,” said Sonkin. “For homeowners, this can make for a smoother, turnkey ownership experience, with fewer unanticipated delays.”

Instead, she added, “Upgrades, like granite countertops, have become the norm.”

Of the 23 markets covered by the report, Pulte brands, which include Del Webb, DeVosta Homes and Pulte Homes, led in satisfaction in 12 of them. Other market leaders include Ashton Woods, Brookfield Homes, Centex Homes, Darling Homes, David Weekley Homes, K. Hovnanian, Lennar, M/I Homes, Pardee Homes, Shea Homes, Standard Pacific Homes, and Village Builders.

The survey is based on responses from 26,231 buyers of newly built, single-family homes who have lived in their homes an average of four to 18 months.

Source: CNNMoney.com

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U.S. Homebuyers Paid $7,039 Less Than Listing Price in July

September 15, 2009

Amid continued falling home prices, U.S. homebuyers are negotiating even more discounts at the bargaining table, according to July’s Zillow Real Estate Market Reports. Buyers paid 3.3%, or a nearly $7,039, less than the last listing price on homes for sale during the month of July 2009. That is down slightly from 3.5%, or $7,630, in June, and substantially down from 4.6% ($10,260) in January.

Meanwhile, 22.8% of all homes listed for sale on Zillow had at least one listing price reduction as of Sept. 1, 2009. The median U.S. price reduction was 6.5% off the original listing price. Homes listed for sale on Zillow during August were listed for a median 96 days, up from 91 in July.

Florida homebuyers had the most negotiating power in July, with buyers in the Vero Beach metropolitan statistical area (MSA) paying 10.2%, or a median $23,500, less than the last listing price. Buyers in the Sarasota MSA paid 8.2% less than list price. The Naples, Daytona Beach, Miami-Fort Lauderdale, Panama City, Punta Gorda, Melbourne, Ocala, Tampa, Jacksonville, Port St. Lucie, Gainesville and Lakeland MSAs also ranked, in that order, in the top 25 markets for negotiation. There was less or no room for negotiation in some California markets that have been hard-hit by foreclosures. In the El Centro MSA, buyers paid 1.8%, or a median of $2,150, more than the listing price. In seven California markets- Sacramento, Merced, Modesto, Riverside, Stockton, Yuba City and Fresno- asking price and sale price were the same.

“The strong summer selling season in 2009 has led to a decreasing difference between the last listing price and final sale price, but most buyers are still getting some additional discount at selling time,” said Zillow Chief Economist Dr. Stan Humphries. “We expected list-to-sale price ratios to fall as the sales volume picked up during the summer, and the California markets are showing strong declines in the discount off the last listing price, relative to levels at the start of the year. This is fueled both by increased sales and high proportion of foreclosures re-sales, which are already priced relatively low.

“The fact that many Florida markets are still showing comparatively higher differences between the last listing price and final sale price suggests that inventory levels are still relatively high, keeping considerable downward pressure on prices and encouraging buyers to seek large discounts off the listing price. Overall, buyers are finding favorable conditions for negotiating prices, and now can be a good time to buy, provided homebuyers are financially prepared with healthy down payments and intend to stay in their home for a minimum of five to seven years.”

Source: RISMedia

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Buyers Remain Largely in the Driver’s Seat

September 11, 2009

Homebuyers continue to drive hard bargains, holding down prices while allowing properties to sit on the market for an increasing length of time, according to Zillow.com’s market report.

Nationwide, buyers paid 3.3 percent, or nearly $7,039, less than the last listing price on homes for sale during the month of July. That is a slight improvement over June, when the discount was 3.5 percent and significantly less than the 4.6 percent discount in January.

For Sale

Meanwhile, 22.8 percent of all homes listed for sale on Zillow had at least one listing price reduction as of Sept. 1. The median U.S. price reduction was 6.5 percent off the original listing price. Homes listed for sale on Zillow during August were listed for a median 96 days, up from 91 in July.

Florida homebuyers got the best deals with buyers in the Vero Beach area, paying 10.2 percent, or a median $23,500, less than the last listing prices. Other Florida cities with a percentage of discount in the top 25 nationally were Naples, Daytona Beach, Miami-Fort Lauderdale, Panama City, Punta Gorda, Melbourne, Ocala, Tampa, Jacksonville, Port St. Lucie, Gainesville, and Lakeland.

In California, the situation is swinging in the other direction. In El Centro, Calif., buyers paid 1.8 percent, or a median of $2,150, more than the listing price. In seven California markets – Sacramento, Merced, Modesto, Riverside, Stockton, Yuba City and Fresno – asking price and sale price were the same.

Source: REALTOR.org

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Written by djumper · Filed Under Real Estate Blog