Understanding National Housing Reports from S&P Case-Shiller, NAR and others

What you see nationally for housing trends and reports is important as a general barometer of the market, but you must take into account the local townwide market performance  as well as the market specifically as it relates to your home in order to ascertain what all of these different reports mean to you and your home.

Probably the two biggest and most trusted  national home reports and trends come from Standard & Poor's Case-Shiller Index and the National Association of REALTORS (NAR). I review these reports whenever they come out, which is usually the last week of the month. For example, the Case-Shiller indices came out today, as they always do at 9 AM Eastern time on the last Tuesday of any given month. The Case Shiller reports review non-seasonally adjusted home sales data and  changes in the index are derived  from actual changes in selling prices of homes. At 169.19, our region is in the New York MSA , and  is the third highest in the nation, behind Washington D.C. and Los Angeles, respectively. The index references a starting point of January, 2000  which equals 100.

The NAR (The National Association of REALTORS) report that was issued just five days ago  says that regionally, existing-home sales in the Northeast rose 2.6 percent to an annual level of 790,000 in September and are 6.8 percent above a year ago. The median price in the Northeast was $229,400, down 3.3 percent from September 2010. You may have thought that 790,000 was an average sales price. It almost sounds like one around here. They actually mean that there are 790,000 units sold, and the average sale price is under $230,000. That's my point.

Another thought- For example, as you know,  foreclosures are affecting the housing recovery-some reports say as much as 30 percent of all sales are foreclosures. Now, I would truly hesitate to say,  and I think you would agree with me that for example, nearly one third of all Westport's sales are in distress (they're not) or that that just one third of Bridgeport's home sales are in distress. I can actually look that up, individually on each property that is on the market. It would take some time, but it's do-able. My years of experience tell me quite simply that national averages do not equal local averages, especially in Fairfield County. We typically run better than those national averages, but I also think the general population is astute  enough to know that.

When it comes down to brass tacks, real estate is VERY local.  So local, in fact that I am sure that you, or anyone not even involved in real estate on a daily basis can think of one area in town that sells better than another area, or one area of town that traditionally has lower resale values,  and maybe even one side of the street that is more desirable than other side. That happens all the time, by the way.

A Townwide  average cannot be true for every home in that town. Again, its a great indicator of what's going on in your town, but your home is unique to itself and so are the conditions regarding its value and marketability.  And yes, I perform weekly statistics on five towns. Five towns that I am keenly aware of the market and its intricacies,  because I have reported local statistics for years- as far back as in the 1990's. (ouch, I am dating myself-lol)  At any rate, I offer my reports and trends as an experienced local professional, experienced not only in sales, but in analyzing those sales as well.  When you review my weekly reports, you might notice that I generally focus on the week, and on active listings.  I give averages on sales, but I do not include the addresses of homes that sold. I give an overview at the end of the month, the end of the quarter, and/or my predictions for the upcoming months, but  giving an address and a sale price doesn't do too much of anything for you to figure out what the price of your home will be, without all the additional details that are needed in order to do so.

It is VERY IMPORTANT to know these national statistics. They help us put our market into perspective, just like a townwide analysis helps to put your area in perspective, and a neighborhood analysis helps to put your home's price into perspective. It's all relevant, just place the greater relevancy on the more local figures. Those national statistics are a great base to start on. If you want to price your home, or know what it's worth. Call me, email me, and I'll come over, preview your home, and tell you what the price is after I review the market as it pertains to your home, and your home alone. Just email or call when you need me.

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Finding a Good Real Estate Agent: Things You Need to Know

Looking for a new home is both exciting and nerve wracking. Inexperienced new home buyers need to know how to locate a house that will suit their needs, and how to avoid costly mistakes. A good real estate agent can be a new home buyer's best friend.

It's important to know what to look for when hiring an agent. Before meeting with prospective agents, check realty web sites and advertisements in the area. Prepare a list of questions to ask, and listen carefully to the answers. A good agent will be willing and able to give specific answers to the your questions.

Information from Web Site

The web site can give a lot of information about a prospective real estate agent. Look for at least five years of experience, and some references or testimonials. A successful agent should have clients who can give a good recommendation. Also check for specific data about the particular real estate market such as median home prices and inventory.

Interview Questions and Answers

-          Describe to the prospective agent the type of property desired and specifics such as school district, proximity to work, and characteristics of the neighborhood that would be of interest. Then have the agent reiterate the objectives in his/her own words. This will reveal whether he/she listens carefully to what you say.

-          Ask about the list-price to sales-price ratio. A good buyer's agent should have a ratio that is under 97 percent, closer to 92 percent if this is a buyer's market.

-          Have the agent detail how she will go about finding an appropriate property. Expect to see 5-7 homes per day that the agent has previewed and can describe to you, or as many homes as you are comfortable seeing in one outing. Make sure the agent represents you exclusively for the type of home that you desire, and not other buyers who may be competing for the same property.

-          Find out whether your real estate agent  has real estate agent errors and omissions insurance. Just as doctors need to carry malpractice insurance, a reputable agent should have this protection.

-          Probe the agent's relationships with other professionals such as title and mortgage companies. How does he decide which companies to recommend? Does his agency receive any compensation for these recommendations? If so, choose a different agent.

-          Ask the agent, "What are the top three things that set you above the competition?" The answer should include integrity, ability to communicate, availability by phone or email, and other points in the buyer's favor.

Documents to Look Over

Before needing to make a decision, the client should be able to see:

• Buyer's Broker Agreement: This is the document that is signed when the buyer's agent is hired. It should state whether the buyer agrees to work exclusively with this agent, the length of time the contract will last, and that no fee is expected unless there is a closed deal. In most instances, the seller pays the buyer’s agency fee. Make sure that this is in your contract. All real estate fees are negotiable. Ask whether the client can cancel the agreement before it expires, should the relationship not be working out. The answer should be yes.
• Agency Disclosures
• Purchase Agreement: This should be a sample document, since no actual purchase agreement can be presented yet
• Buyer Disclosures

Final Question to Ask

What have I not asked about that I need to know? The agent should respond readily with specific information. No new client will ask all appropriate questions.

Armed with good questions and some prior knowledge, a new home buyer should be able to find an agent who will work in his/her best interests. This working relationship is an important key to making the experience of buying a home pleasant and rewarding.

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Know the difference - Market Time vs. Market History vs. Listing History.

Once you know the difference between the three, and that there is a very relevant difference between the three,  the most commonly used term that you have heard over and over again (Market Time ) becomes incomplete information and nearly irrelevant as it pertains to pricing your home or negotiating for your purchase.

Market Time: This number is measured in days and  is on every listing data sheet. As I have mentioned in previous articles, the number is pretty much hidden in plain site at the top of your MLS listing fact sheet, and it would appear as trivial as MT 122. As a buyer, you may not be aware that MT 122 means that the market time is 122 days on that listing.

Market History: A complete rundown on that particular home's listing history. For example, that MT 122 that I just mentioned is only for the listing that is active NOW. If that home has been on the market before for 200 days and didn't sell, the market time on that house would effectively and cumulatively be 322, and NOT 122. Would that make a difference to you as a buyer in what you might offer?

That particular home could have been listed more than once before. The cumulative market time is the most important figure with just a few things to remember as you look at this data.

Listing History:  A detailed listing of any changes in status of a particular  home's listing(s). If it has been on the market more than once,  you will need the full Market  History before you can obtain the full Listing History.  The Listing history will include the date the home went on the market and the original list price, the date and amount of any price reductions, the date of any deposit, the date the deposit fell through, adn the date that particular listing went off the market

IMPORTANT TIP: Market time is valuable information, but as far as knowing how to best negotiate for a home,  it means nothing unless a the Listing History is obtained.

Here's a Counterpoint -Why do Realtors seem to quote market time  as such an important number in market statistics if in fact, it may not be complete information as you say?

We refer to and quote market time on a townwide basis for averages. At least I do. I cannot speak for other Realtors. A few things to note about averages. There has to be a high and a low, obviously. Most homes will also fall above and below that average, obviously.  It is a generalization, but still an important one to understand the townwide market performance.

Once you understand town performance, you can better pinpoint a property value within that town. Does that make sense? I liken it to learning the alphabet, before one is able to write a word.  You MUST have a very good knowledge of the alphabet before you can write a word and understand what you actually wrote. You MUST know the town well, before you can price an individual  home effectively.

Obtaining Listing History is great for an indiviual property,  but lends little if anything more to the overall town's market performance which is based on averages. So Market Time is best used as a generalization for the town, and to recap, Listing History should be used specifically to price a home as effectively and appropriately as possible after reviewing market history. Bottom Line:When it comes to pricing a home, never forget the market time as an average, but  the Market History and Listing History are both KEY.

Contact me to price your home. And to sell it. Or negotiate the best deal for you.

Remember, the right agent is KEY, too :)

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Why You Should Think Twice About Using Your Friend as your Realtor

Most people have a friend or two that is in the real estate business. When it comes time to buy a house or sell your home, or both- your first inclination may be to "use" your friend that's a Realtor.

Not always that good of an idea.  There are over 21,000 Realtors in Connecticut alone, and there are a lot of real estate agents  to choose from. Is your friend an experienced and accomplished full-time Realtor? Unless your friend  truly knows how to market your home and negotiate a sale,  then you are just setting yourself up for trouble, and by that, I mean your bottom line net sales price, AND your friendship. It's time to think twice about it.

Your real estate transaction is a very personal one, and some very private information that you may not want your friend to know may come out.

It's nobody's business in your personal sphere of friends as to  how much money you have in the bank, what your finances are, and what your credit score. You may be judged and not even be aware of it. I know, it's a horrible thing to say. I'm not saying that all agents that are friends with you would disclose your private information to your mutual friends, I'm just saying it can happen. It's an uncomfortable situation that is just waiting to happen, and is easily avoidable.

What would happen if something went wrong or wasn't going well with your home purchase or sale? Would you be strong enough to say something to your friend/Realtor? Is it possible that you could end up getting in an argument and losing the friendship? Suppose that your friend the Realtor botched a sale, and you lost a lot of money because of it. Not good.  Also, easily avoidable.

Okay, so you feel obligated to work with your friend. After all, he/she really is a very good friend. Are you 100 percent certain that they can do the best job for you? Or is this out of loyalty to your friendship?  

Now, I'll ask you the big question...

If you didn't list your home or buy your new home with your friend, would that person be mad at you? Would your friendship be strained at all?  If the answer is yes, your friend will be very mad, then the harsh reality is that that's not really a friend, is it? If you are not sure of the answer, or have any hesitation at all regarding what the answer to that question may be, then the answer really becomes quite clear. A true friend ALWAYS wants what is best for you, and it should NEVER hinge on whether they make any money off of you, or get your business if they truly don't deserve it.

If and when I encounter a client with a friend or relative in the business that they feel immense loyalty to, I offer them the best of both worlds. That is, great representation by me,  and I will give your licensed friend a referral fee on your home sale or purchase. That way you still remain loyal to your friend,  they don't have to do anything at all and get paid without having to work for it,  AND you get the best marketing, negotiation skillset and representation that's available to you.

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TheCTrealtyBlog Lands in the 'Technorati Top 100' and is the Number One Real Estate Blog in CT!

'Technorati's Top 100  for Business/Real Estate: TheCTrealtyBlog.com !

We’re thrilled to let you know that TheCTrealtyBlog.com is featured on Technorati as being in the Top 100 Business/Real Estate Blogs in the entire country! 

We are the only real estate blog in Connecticut to make this Category's Top 100, and  by reading our Blog, you are certainly in good company. Other blogs in the Business/Real Estate Top 100 list includes such notable real estate and finance blogs as and WSJ.com Developments,  Mortgage101, and The Realtor.com blog .

Technorati  was launched in 2002, and is the premier Internet search engine for relevant blogs.  Technorati currently indexes over 150 million blogs and ranks them according to authority, relevancy, and clout within its industry sector.  The name Technorati is a blend of the words technology and literati, which invokes the notion of technological intelligence or intellectualism.

The CT Realty Blog was founded by Broker Judy Szablak, a successful Fairfield County Connecticut  Realtor  for the past 26+ years. "We've concentrated  our efforts in the past year to produce timely, accurate and insightful reporting on real estate in Fairfield County Connecticut," said Szablak, TheCTrealtyBlog's Editor. "I recognize the honor that it truly is, and to see our work recognized by Technorati in this fashion is a great feeling, and we owe our success to our clients- without them, we would not have the experence to write what we do."

To get the most from theCTrealtyBlog, sign up for the RSS Feed to get updates on new posts, the latest news and hottest listings. Visit any of their local town blogs for up to the minute real estate market statistics and forecasts for Easton, Fairfield, Norwalk, Trumbull and Westport.

Judy is a successful real estate agent who specializes in  Fairfield County, Connecticut, so when you are ready to buy or sell, contact Judy Szablak, the agent with "Authority".

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