A point that I've been adamant about when speaking to clients over the last few months has begun to gain some traction in articles online, in the paper and on NBC-2.com locally as well as CNBC.com. That is, the market here is improving and has probably over corrected for the most part and also that all real estate is local and you need to educate yourself on what is going on in that market. That is not to say nothing else effects it, but how it effects it can be very different. Just because the Midwest is mostly in a slump due to manufacturing their are and will always be people that have the desire and means to purchase in Southwest Florida (Naples, Bonita Springs, Estero, Fort Myers, etc). Opportunity in resort markets and the stock market is often clouded by avarice (or greed). It seems when the market was good the sellers were unreasonable and the buyers were eager to bend to the terms. Since the downturn in the market it now seems to have turned around and many buyers are not only looking for a great buy but they are specifically seeking "blood in the water" to squeezer out every last bit of value. In either respect when was getting what was perceived as a "good value" not enough?
In terms of the difference in housing numbers being reported, A recent article by Matt Carter of Inman News analyzes the differences between the housing numbers reported by OFHEO (Office of Federal Housing Enterprise Oversight), NAR (the National Association of Realtors) and the numbers reported by the S & P/Case-Shiller index. In short, Carter summarizes that their differences are easily explained, and they boil down to this:
1) Case-Shiller and OFHEO look at repeat purchases and exclude new-home purchases, but OFHEO also throws in appraisals that are generated when people refinance their homes. As we have all become very cognizant of lately, what a house will appraise for and what a house will actually sell for on the market can be very different things.
2) OFHEO doesn't consider transactions involving loans that are too big or too risky to be guaranteed by Fannie and Freddie, and acknowledges that homes with these mortgages on the upper and lower price ranges are seeing bigger price declines than the homes it tracks.
3) NAR looks at sales of existing homes listed by MLSs, and reports median home prices, which reduces the impact of price volatility in upper price ranges.
The result is that the Case-Shiller index can show more extreme swings in price -- both up and down -- than NAR or OFHEO's numbers.
Read the entire article : Click Here
Refer Garren & Expect Noteworthy Results!
Wednesday, June 11, 2008
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