May 9th, 2008
Recently, one of my referral sources in California asked about the state of the Raleigh real estate market and commented his client was disappointed he could not find a good deal in Raleigh. This is what I wrote —
“Although we are seeing more softening in the Raleigh real estate market, our market is still not at the fire sale stage. Until late summer 2007, we had held our own throughout this economic cycle. However, we are now seeing builders offering more incentives during the spring market when they noticed their sales were not like they were last year. We have had price reductions, interest rate buy downs, additional “free” upgrades, more closing costs, appliance packages, and many other creative perks. We have 25% fewer sales and 47% fewer construction permits as this time last year. Of course, this is an optimum time to purchase in our market — low interest rates, negotiable sellers and a reduction in construction permits (which could create a shortage when the market makes a turn, and give a real estate investors a bump in appreciation due to shortage). And interestingly enough, even with prices on the move down, the average price of homes in our market rose which is unusual. The neighborhoods where I take buyers are clean, comfortable and safe, easy to rent, and areas I feel have the best chance to grow in appreciation over the years. We are not able to get the extraordinary deals from these neighborhood builders as I might be able to in a neighborhood that is in an area that I do not feel as positive about. Thank you for your call. I hope you can help your client see the value in our market although we are not able to dazzle your referral with a deal up front in our current real estate market. Builders are eager to get offers and they are ready to deal, but unwilling to show all their cards up front by offering deep discounts. I would love the opportunity to negotiate a really great deal for your referral.”
Over my 50 years of experience following the Raleigh real estate market, the Raleigh area has traditionally handled the ups and downs with style and grace when the inevitable real estate cycles come around. We are usually the last to feel the affects of the market and one of the first to feel it when it returns. The four cornerstones of our market — Education, Government, Technology and Medicine — serve us well and continue to attract jobs to our area.
I always love talking with buyers and sellers about our market and if you want to talk about it personally with me, give me a call – 919.961.7777.
Posted in Raleigh Real Estate, Raleigh North Carolina Real Estate, Investing in Raleigh Area Real Estate, eMails to Real Estate Investors | No Comments »
May 2nd, 2008
Little change is expected in Wake County NC real estate sales of existing homes over the next few months, before notably improving during the second half of the year, according to the latest forecast by the National Association of Realtors. Lawrence Yun, NAR Chief Economist, said the market will come into clearer focus this summer. “Existing home sales could start to show a sustained increase within a few months, unless there are some additional economic problems or excessive inflationary pressure,” he said. “The wider access to affordable credit should increase sales activity notably this summer as pent-up demand begins to be met.”
Let’s take a look at the Wake County real estate market activity for this March to see how the spring is looking so far:
Inventory again increased by 25% this March in Wake County, compared with March 2007. Sales for the month were down 29%, while year-to-date sales dropped 12% from the same time last year. The average sales price increased a modest 2% to $259,301.
|
Raleigh
(Wake County) |
Active
Listings |
Sold
Listings |
Average
Sales Price |
Year-to-Date
Sales |
|
March 2008
|
9,058
|
1,245
|
$259,301
|
19,852
|
|
March 2007
|
6,928
|
1,763
|
$255,238
|
22,543
|
Now is a great time to buy or sell Raleigh NC real estate. For more personalized service, please call me at 919-961-7777.
Posted in Raleigh Real Estate, Raleigh North Carolina Real Estate, Raleigh North Carolina Real Estate Statistics, Investing in Raleigh Area Real Estate | No Comments »
April 24th, 2008
Although the Raleigh, Wake County and the Research Triangle Park real estate market is being affected by the National downturn in the housing industry, we are a very sturdy market and observing the way our local economy has handled past economic cycles, we tend to be able to hang in there until the cycle makes a turn. Of course, we have seen things in this economic cycle that we have not seen previously, like higher than usual foreclosures due to the liberal mortgage guidelines that were once readily available. In reviewing the Triangle Multiple Listing statistics, home sales have fallen 28 percent when compared with sales from last year. (However, interestingly enough the average price of $235,175 was up by .6% from last year.) And when you take a look at building permits issued in Wake County (Raleigh, Cary, Wake Forest, Holly Springs, Garner, Fuquay Varina, Apex), there has been nearly a 47% decline. What does this all mean? Well, here is my SWAG (actually it is an educated opinion) – sellers are reducing their prices (MLS statistics report 42% reduced their listing price last month compared with 32% who dropped their price March a year ago) and interest rates are low and that makes for a great combination and excellent environment for real estate investing. Of course, I do not have a crystal ball, however, based on past experience this is one of those times in the market when one will look back and say “If I had only made a decision then, look what I would have now.” And, what about this – building permits are down. So what does that mean? To me it means when the economy turns we could have a shortage of housing which will encourage appreciation. So, bottom line, if you are “waiting for the economy to turn” or “get better” you may find you missed a golden opportunity to purchase real estate at a time of low interest rates and enticing price reductions. Don’t let it slip by.
Posted in Raleigh Real Estate | No Comments »
April 19th, 2008
You have probably heard that Raleigh is in the Research Triangle area, but do you know where that name came from? The Triangle referred to is the one created by connecting the research universities in Chapel Hill (University of North Carolina), Durham (Duke University), and Raleigh (North Carolina State University). In the center of this triangle, the Research Triangle Park has developed as a combined effort of business, government and university leaders. While there are a variety of businesses in the Park, the majority of companies are in the medical, research and technology fields.
This month Bizjournals included Raleigh in its profiles of the 10 smartest metro areas in the country. Raleigh is one of 8 metro areas where at least 40% of the residents have at least a Bachelors Degree. Bizjournals reports that a more educated work force boosts the economic strength of the nation’s metro areas. We have certainly seen that in the Raleigh area. Not only does the educated workforce have more income and more to spend and invest, they also attract employers that provide more job growth. These dynamics help feed the vitality we are experiencing in the Raleigh area. It pays to be smart.
Posted in Raleigh Real Estate | No Comments »
March 21st, 2008
February 2008 Raleigh NC Market Trends Report
The volume of existing-home sales is expected to hold steady through late spring, with a gradual recovery during the second half of the year as the mortgage situation improves in high-cost areas, according to the latest forecast by the National Association of Realtors.
Lawrence Yun, NAR chief economist, said many buyers have been waiting for higher mortgage loan limits. “The higher loan limits for both FHA and conventional loans will increase consumer choice and provide greater access to lower interest rate mortgages in high-cost regions,” he said. “Therefore, a notable rise in home sales can be anticipated in the second half of the year.”
Let’s take a look at the real estate sales statistics for February 2008 to see how the market is looking in Wake County:
Wake County saw a 25% increase in active listings over February 2007. Sold listings, however, were down 16% this February while year-to-date sales decreased by 10%. The average sales price dropped a relatively modest 2% to $259,486.
Raleigh
(Wake County) |
Active
Listings |
Sold
Listings |
Average
Sales Price |
Year-to-Date
Sales |
| February 2008 |
8,943 |
1,084 |
$259,486 |
19,892 |
| February 2007 |
6,675 |
1,285 |
$264,355 |
22,225 |
Although listings are up and sales are down, this is a modest change when compared with other markets. Our stable economy has shown it is able withstand the national trend as we have experienced downturns in our economy before. Many buyers are taking this opportunity to take advantage of the situation. (What does Warren Buffet do?) Sellers are negotiable. They know they are competing with more and more other properties. And, interest rates are low. The best of both worlds, wouldn’t you say?
Posted in Raleigh Real Estate, Relocating to the Raleigh Durham Area, Real Estate Bubble? What Real Estate Bubble?, Investing in Raleigh Area Real Estate | No Comments »
February 11th, 2008
Recently an International real estate buyer client came to visit Raleigh. He was interested in purchasing real estate investment property in our area since he had so many wonderful things about our economy and the quality of life we enjoy in the Triangle area. However, because he has also been reading the newspapers and listening to television reports, and the ”gloom and doom” talk, after we located a well-priced, strategically located property, he stepped back to take another look. He kept hearing “the voices” from the media and was suspect about the sustainability of our market. I have been licensed since 1978 and have seen many real estate cycles. Raleigh has demonstrated over and over that it can withstand the downturns. We continue to have jobs come into our market and that is the secret to our stable area. And, recently we were named #2 by Forbes as having some of the best bargains for house hunters.
http://www.forbes.com/forbeslife/2008/02/07/house-bargain-hunters-forbeslife-cx_mw_0207realestate.html
Here is how I responded to my cautious investor:
Your comment “in light of the recent happenings in the US market”. One cannot read National news and apply it directly to our local economy. It does not fit the Research Triangle Area like it fits many other parts of the country. We continue to have jobs flowing into the Triangle which of course is what any economy must have in order to maintain growth. We are in an optimum time for real estate investing in the Raleigh area, as we are one of the more stable markets in the US. Of course we have been feeling the effects of the national economy — we cannot help but be affected. I have been in Raleigh since 1959, and have seen a number of economic cycles. Traditionally our area is the last to feel the downward trends, and we are the first to respond when the economy makes a come back. Our local economy has demonstrated many times it is strong enough to withstand the continuing cycle. Stick around — in good times and in not so good — it will change — it always does. My personal prediction — we will smooth out for a while and “hang in there,” then begin to see an upturn in about 12 to 18 months. I am currently adding to my personal real estate investment portfolio. It’s a timely thing to do in the Triangle with interest rates as low as they are, along with it currently having turned into a buyer’s market. As an aside — last Spring we were in a seller’s market; Summer came and we sensed a change; October arrived and we were could see the difference; then since November, sellers have been realizing more and more they are not able to take the hard line they enjoyed as few as 6-8 months prior. I am grateful to be working with more buyers than sellers right now. And, I am thankful to be a real estate broker who works with investor buyers and am not a builder. Look forward to hearing from you soon. Take care. jan
Posted in Raleigh Real Estate, Raleigh Durham Area "Top Ten" Lists, Real Estate Investing in the Raleigh-Durham Area, Investing in Raleigh Area Real Estate, eMails to Real Estate Investors | No Comments »
December 23rd, 2007
Selling real estate in Raleigh is such a pleasure. What a great opportunity I have had over the years to meet relocating families who are looking forward to making the Raleigh and Research Triangle Area their home. And as part of my real estate practice, for the past couple of years I have also had the opportunity to work with out-of-state real estate investors (California, Florida, New York, Massachusetts, Nevada, Oregon to name of few places) helping them locate sound long-term real estate investments in our area. The Raleigh real estate market is perfect for the long-term buy and hold investor who is looking at the future and wanting to invest to put a child through college, or prepare for retirement. The Raleigh real estate market has shown slow and steady growth over the years which makes for a stable area for real estate investing.
Posted in Raleigh Real Estate, Relocating to the Raleigh Durham Area, Real Estate Investing in the Raleigh-Durham Area, Investing in Raleigh Area Real Estate | No Comments »
December 23rd, 2007
An excerpt from an email to one of my real estate investor clients:
What a great question, and one to which I am always happy to respond, because the answer is so amazing – especially in light of the current National trend in the housing market. As you are certainly aware, one of the best indicators of the health of any economy is to look at job growth. In Raleigh, our highly-educated job pool attracts more and more high tech companies looking to rub elbows and capture the opportunities provided when there is a concentration of like companies. And, although these incoming companies are important to our job growth, our current employers are another important resource, as they continue their expansion mode. A recent internet article projects future job growth in Wake County over the next ten years to be 25.57% (Source: bestplaces.net).
The employment cornerstones of Raleigh-Cary and Wake County are (1) Medical Research (2) Technology (3) Government and (4) Education. Because we are not dependent upon any one industry for our economic health, we are able to provide a balanced economic climate for both incoming companies and real estate investors. For instance, in 2000 - 2002 we experienced a significant lay off within our telecommunications industry. Most would have predicted a downturn, however, it did little to the state of our economy and we were able to quickly recover and absorb the added housing inventory without a too much difficulty. And because there were new jobs coming in behind the ones that were lost, we hardly missed a step.
Although the Raleigh market is beginning to feel some of the influence of what is happening Nationally, because the Raleigh real estate market traditionally appreciates at a “slow and steady” pace, any decline that comes our way tends to be correspondingly modest. Over the last 10 years we have experienced appreciation rates of 3% each year from 1998 to 2001; 4% in 2002; 5% in 2003 and 2004; 6% in 2005 and 2006 (Source: TARR Report - Triangle Area Regional Real Estate Report)**. Early predictions during 2007 indicate a 7% appreciation rate in 2007. Although we do not know what the future holds, historically the Raleigh-Cary and Wake County real estate market has always been able to hold its own and should continue to be a viable market for long-term buy and hold real estate investors. I call our area a “Blue Chip” market, and based on past history, a ”Safe Haven.” Fortunately for those of us who work with real estate investors, we are secure when presenting our area for consideration, since we are confident about the strength of our market, our future and the likelihood of continued growth. The Raleigh-Cary and Wake County area provides a strong and stable market for real estate investors.
Please let me know if you have additional questions, as I am always happy to have an opportunity to talk about the Raleigh and Wake County real estate market!
** I use several sources to gather statistical data (News & Observer; Triangle Area Regional Real Estate Report; Multiple Listing Service and several Federal websites. Although the statistics vary from site to site depending on the criterial used, trends from source to source tend to show a similar pattern.)
Posted in Raleigh Real Estate, Raleigh North Carolina Real Estate Statistics, Real Estate Investing in the Raleigh-Durham Area, Investing in Raleigh Area Real Estate, eMails to Real Estate Investors | No Comments »
November 27th, 2007
Based on recent predictions by financial forecaster Global Insight, provided to the US Conference of Mayors, the Raleigh-Cary economic growth is expected to decline by more than 20 percent next year. The Raleigh-Cary real estate market has been more or less sheltered from the national housing slump and has just recently noticed a slow down with more homes on the market than this time last year (however, interestingly, appreciation of homes has gone up 5% to 6%). Although we have been expecting the national real estate downturn to affect our market for a while, as in the past, we do not anticipate our area to experience the dramatic economic downtown as seen in many of our other national real estate markets. Real estate appreciation rates in the Wake County area for the last ten years has been 1996 3.4%; 1997 3.8%; 1998 4.2%; 1999 3.9%; 2000 3.1%; 2001 4.4%; 2002 2.4%; 2003 2.1%; 2004 3%; 2005 4.8%; 2006 6.2% The coming year will be interesting one as our market is influenced by the national downturn in the housing market while facing the predicted 1.4 million foreclosures (nationally) and the pending reset of millions of adjustable rate mortgages. The Raleigh-Cary real estate market still has something that many of the other areas do not – job growth! We continue to attract high tech industries and our companies are continuing to grow. What a great area to be investing in real estate!
Posted in Raleigh Real Estate, Raleigh North Carolina Real Estate Statistics, Real Estate Investing in the Raleigh-Durham Area, Investing in Raleigh Area Real Estate | No Comments »
November 6th, 2007
Many thanks to Ethan Jarvis, Mortgage Consultant with Carolina Residential Lending, for sending this link along with his comments about the relationship (or lack thereof) of the prime rate and how it relates (or doesn’t) to mortgage rates. If you would like to consult with Ethan, you can reach him at 919.656.6647 or send him an email at ethan@carolinaresidentiallending.com
“This is a great article explaining the how and why many times fixed rate mortgages do not follow the Fed cutting rates. To sum it up, the Fed reduced the Fed Funds rate and the discount rate last week. The fed funds rate is what prime rate is based on. So when they cut rates last week it lowered HELOCs (Home Equity Line of Credit) and credit card rates. The discount rate is what banks are charged from the Federal Reserve discount window. Neither of these rates have a direct bearing on how the 30 year fixed rates with perform. As we have seen in the past, many times when the Fed reduces the Fed Funds rate, fixed rates actually increased. The bond market dictates how fixed rates move. Many times people are confused to why fixed rates are not lower after a rate cut. I hope this helps you explain to your customers how it works.”
Article Link: http://bankrate.com/brm/news/fed/20071102_Fed_mortgages_differences_a1.asp
Posted in Raleigh Real Estate | No Comments »