2nd quarter 2017 Cache Valley/Logan Market Statistics

“Hotter than the Fourth of July” has real meaning for us this year!  After running numbers on the 2nd quarter stats for Cache Valley, I am here to report the  Real Estate market has been “HOT” as well… While there were 10% fewer sales in the 2nd quarter of 2017 than the 2nd quarter of 2016,  prices were 12% higher!  In June, the average price per foot for homes sold in Cache Valley was a remarkable $105.

Inventory remains tight.  Today (July 7) there are 271 active homes on the market, and the average days on market (time it takes for a listing to go under contract) is 57.  Interestingly, homes priced under $250,000 continue to sell VERY quickly and the inventory remains low, but homes priced over $500,000 have an average days on market of 270 days!  There are currently 45  homes on the market priced above $500,000 (16.6% of the inventory) , and only 9 homes (1% of the sales) in that price range sold in the past 6 months. Takeaway:  If you have a home for sale priced over $500,000, please be patient. 

In this market, traditionally 2nd quarter has the highest number of listings and 3rd quarter reflects the highest number of sales.  If those statistics hold true for this year, inventory in the coming months may be even lower than today’s 271.

Right now, making a move-up in home size makes a lot of sense.  Smaller homes are in especially high demand, and there is more inventory (percentage-wise) available in larger homes – priced above $350,000.  Mortgage prime interest rates are below 4% again, and compared to most of the USA, affordability is good.

If you need any Real Estate information or assistance, please call or e-mail.

Terri Sizemore 435-770-9407, supersizemore58@gmail.com

STAY COOL!

Logan/Cache Valley Real Estate update May 2017

Commerce is all about supply and demand.  Here in Cache Valley, the demand for homes continues to exceed the supply – especially the supply of affordable homes.  Today there are 253 homes active on the market (listed on the MLS).  That’s 27.5% less than the 349 on the market exactly 1 year ago…. and we thought the home inventory was low then!

Although the inventory is much lower than it has been in the past 17 years (yes, the last time active listings were this low was pre- 1999), home sales for the first quarter of 2017  (259 sales) were still higher than the first quarter sales of 2009 through 2015!  (First quarter sales in 2016 were 12% higher at 290).  There were more sales in April this year (119) than any other April since the big boom in 2007 – illustrating just how quickly homes are selling.  The average days on market is just 64, and for the lower priced homes (under $150,000) it’s just 37 days.  

The increased demand for homes has continued to drive home prices upward.  In April the average price per foot increased to $97, and the average sold home price was $220,000 ( In April, 2010 the average sold price was $172,000).  There have been appraisal problems arising with the rapid appreciation rates.  Homes still need to appraise so the values must be substantiated – this will keep rising home prices in check.

Mortgage interest rates, while expected to increase, have really remained stable so far this year and are still hovering around a very affordable 4%.  Now is the perfect time to sell a smaller home and move up.  Of the 253 homes listed, 108 of them (43%) are priced above $300,000.  Homes priced under $225,000 are going like hot cakes.

Newly built homes are adding to the home inventory, and I expect the number of homes active on the market to increase – stabilizing prices…While I don’t have firm statistics on the number of homes built in the Valley in the past year, it’s not hard to see builders are working at a frenzied pace to keep up with demand.

As I look back through old stats and reflect on the real estate market the past 8 years, … it’s a great thing to see seller’s once again realizing profits through home appreciation, and in Cache Valley home affordability is still excellent compared to most of the US.  This is a desirable and beautiful place to live.

Please feel free to ask for help in determining the value in your home if you’re contemplating selling, or help in looking for a home if you think it’s time to purchase.

Enjoy the warmth to come!

Terri Sizemore 435-770-9407

 

 

 

 

 

Status of the Logan/Cache Valley Real Estate Market

Yet another Year has flashed by, and our local Real Estate Market was a real “rip snorter”!                         img_0892

In 2016, home sales were up 10.7% over 2015 (1607 homes sold in Cache Valley), and sold prices were up 9.6%!!  The average sold price per foot in 2016 was $92 and the last 6 months it averaged $95 per foot.  Our previous market high (late 2007) was an average price per foot of $88.  Please keep in mind, these average prices include new homes, single level, 2 story etc… It’s important to have a Real Estate professional or appraiser evaluate your specific home/location to determine your home’s value.

Factors contributing to the increased home prices are: low inventory – there has been a 13.1% decrease in the average number of homes available on the market since 2015 (at this moment in time there are just 226 homes on the market in Cache Valley), and increased demand for homes as Utah continues to benefit from an influx of new home buyers.  15,000 people reportedly moved to the state last year, and Utah ranks 2nd in the US in Millennial (those born between 1982 and 2004) home buying.

Prime mortgage interest rates, while up .75-1% the past several months, are still very affordable. According to The Mortgage Report (an unbiased, very useful mortgage news publication) they are expected to hover between 4-4.32% in 2017.  Government backed loans (FHA, VA & USDA) actually provide even lower rates currently, but have accompanying mortgage insurance premiums).freddie-mac-rates-long-term

All signs point to the Real Estate market remaining strong. Housing appreciation in Utah overall is projected to slow in 2017 to a more sustainable 5-6% as builders continue to add to the home inventory – which is good news for buyers.

Best Wishes for a Happy and Prosperous 2017!

 

 

 

The truth about on-line home valuations….  

The truth about on-line home valuations in Utah (i.e.… Zillow zestimates, Trulia estimates)

 

I frequently get calls from friends and clients – confused or upset because they saw a “zestimate” that valued their home at $25,000 below what we have it listed for or $10,000 below (or above) what they purchased it for…. Sometimes they’re excited because they think it will be justification to contest a property tax bill.

While offering an additional good marketing tool, sites such as Zillow and Trulia access information that is incomplete and therefore inaccurate.  Utah is a non-disclosure state – meaning sales prices are not public information.   Even in full disclosure states such as Colorado – where sales information is readily available, the MLS is the only really accurate valuation resource– providing important additional information such as square footage on each level of the home.  (Main level square footage is more valuable than 2nd floor footage – which is more valuable than below-grade space).

Real Estate professionals are able to access information from the MLS – evaluating home sales of homes comparable to yours in size, style, age and condition – including the very important square footage per floor comparison; thereby arriving at a reasonably accurate home valuation.  Appraisers perform an even more in- depth evaluation of “sold” comparisons –thus providing an even better assurance of  home value.

In summary:  Don’t stress (or celebrate) about a zestimate or any other on-line look up home evaluation.  If you need to know what you home would sell for right now, call your knowledgeable Realtor – ask her or him to please look at your home, take some time to pull and evaluate comparable “solds” and voila – you’ll find out within reasonable accuracy what your home is worth.

As a buyer, why should I use a Realtor?

For your protection

Buying a home is a very important and expensive purchase – probably the most important purchase you will ever make. It’s very important to have someone help you who is educated in all the facets of real estate.

Unlike hiring an attorney to represent you, it’s one of the few instances in life where you can have professional representation and you don’t even pay for it.  Realtor fees are typically paid by the home seller.  Brokerage commissions are split by the Realtor listing the property, and the Realtor bringing the buyer.  As a buyer, it is generally in your best interest to have a Realtor representing YOU versus using the listing agent who represents the seller.

Realtors have knowledge & CONNECTIONS

A competent Agent knows the market and will do research on the value of homes you’re interested in. If questions arise about properties, they do the necessary research with county records, cities, etc… they’ll find the answers to questions about animal rights, water rights, covenants etc…allowing you to make a well-informed purchasing decision.

They have connections with other professionals.  They can direct you to qualified lenders, reputable inspectors, contractors etc…

         They’re trained Professionals

  1. Real estate professionals take classes continually to make sure they’re educated on all new laws, procedures, forms etc…
  2. They have experience. .. The first time doing anything is always rocky and uncertain. experience helps take away the rockiness.
  3. Realtors pay dues for full access to the MLS (multiple listing service)- they can access and research all of the properties for sale (not just those from a particular brokerage), share listings via the internet, and then physically show you homes that interest you.
  4. Realtors are able (time allowing) to preview homes before you see them…saving you time if you’re clear on your parameters.
  5. Paperwork…They know what forms and contracts are needed and will make sure they’re filled out correctly and legally.
  6. They will manage the transactions and dates for you.
  7. Maybe most importantly, a trustworthy Realtor will negotiate the best terms for YOU. After you find that perfect home, research will be performed to determine the true market value of the home, ensuring that you know what you’re buying, and you don’t overpay

 

A competent, honest Realtor is invaluable in making your home purchase a smooth, safe and happy transaction.  If you’re thinking about purchasing a home I would appreciate your consideration when choosing a Realtor.  Terri Sizemore 435-770-9407

The Best Day!

Winter Glory
Winter Glory

Ralph Waldo Emerson said “Write it on your heart that every day is the best day of the year”.

As I reflect on the:  many joys, some difficulties, embarrassing moments, successes, failures, new friends, fun days,  and blessings experienced in 2014 I have to say THANK YOU GOD FOR YEAR PAST, AND HURRAH FOR NEW ONE COMING!

Helen Keller- so familiar with every kind of difficulty –  profoundly expressed a New Years Resolve:

“Your success and happiness lies in you.

Resolve to keep happy,

and your joy and you

shall form an invincible host against difficulties.”

Happy New Year!

Should I Purchase a Rental Property?

Investing in Real Estate can make terrific sense, but as in all investment strategies – there is some inherent risk…

Here is a brief summary of things to consider when purchasing a rental property:

  • Personal Finance considerations: Lenders typically require 25% down on an investment property mortgage (caveat -if part of the rental property is your primary home – as in a duplex where you live in one unit and rent the other unit out, loan programs such as FHA with as little as 3.5% down are available).  Interest rates will also be higher than the rate available on a primary residential mortgage.  Your credit, income, assets and debt ratios all factor in on the interest rate offered.  As with all mortgages, closing costs will be associated (plan on 3% of the loan amount).   It’s wise to have a large “nest egg” saved up to cover vacancy loss, improvements and repair costs.  Money desperation can facilitate unwise decisions in accepting “risky” renters – leading to serious money woes.
  • Personality considerations: Ask yourself, “Do I want to be a Landlord?”  Landlords have to screen for tenants.   Will you be able to say “No” when you need to?  Will you be able to be firm about collecting rent?  How do you feel about doing/ or hiring out repair work?  Using a property management company is a very good option (one I recommend) if you don’t want to be a landlord.  Most management companies charge around 10% of the rental income (becoming another financial consideration).
  • Property considerations: Budget will dictate some things, but when evaluating properties consider the neighborhood and associated demographics.  Properties near the university are in high demand (low vacancy), and often can glean higher rents (depending on the condition of the property), but also may have higher turn-over and more repair costs.  A single family home near a school may provide more rental stability and lower turnover once rented but may be harder to rent initially.  The age, size, condition, location and amenities (garage, laundry, yard etc…) of the property will influence potential rental income as well as the potential outlay for maintenance.
  • Investment considerations: Return on investment (ROI) a profitability measure that evaluates the performance of a business by dividing net profit by net worth,   cash flow Income less expenses, risk, and tax implications are all important aspects of investment considerations.   

Cash flow example:  

                     1900 sq. ft, 3BR, 2 BA single family home in North Logan

                     $160,000 (negotiated seller paid closing costs $4800)

                     25% down            $40,000 

                     Loan                      $120,000 @ 4.75% interest

          Payments             $626 + $100 per month tax & insurance = $726/mo

         Potential rent      $1150/mo – less 10% management fee =    $1035/mo

         Gross monthly cash flow:   $309   ($3708 per year)

                                  9.27% ROI, excluding vacancy loss & repairs – (an unknown)   

Additional tax advantages & appreciation of the asset (Real Estate has traditionally appreciated at a rate of 3 -4% per year, although we all know this is not a fail safe assumption) May make this purchase a very desirable investment decision.