Q: "What is the relationship of sale price to asking price in the current residential market?"
A: There is not a common pattern amongst the three outer Cape towns, but in many segments of the residential market, we have seen a slight drop during the past 12 months in the percentage of sale price to list price. Keep in mind, however, that these percentages do not reflect original list prices. Many of the properties that sold experienced one or more price reductions during the course of their time on the market, and the statistics that are published reflect the percentage of Sale Price to current list price. For examples of this in chart form for Provincetown, Truro and Wellfleet, see this entry on provincetownrealestate.com.
Thursday, July 31, 2008
Thursday, July 24, 2008
Timing is Everything
Q: "I own a home in Provincetown. I recently accepted a position in Chicago, put my South End condo on the market and actually sold it for a fair price. I guess timing is everything even in a slow market. Here’s my question: Should I rent or buy in Chicago?
The market is such a buyer’s market that I’d hate to miss an opportunity. Follow up: Since I won’t be going to Provincetown nearly as much, should I sell the home? I bought it in the mid nineties, have a strong equity position and can be a realistic, competitive seller. "
A: What a great question for the current times. Let’s start by addressing the inquiry about renting or owning. The current real estate market is projected to remain soft for at least another year. You may want to find a rental unit in a suitable location for one year. In that time you will determine which neighborhood in Chicago suites your lifestyle and real estate needs. One year should also be telltale as to whether the job you accepted is going to work out. You may find yourself not liking Chicago or the job.
The first half of 2008 was strong for Provincetown sales. We have seen a correction of about 10+% decrease of value in most cases. If you don’t have to sell than exercising prudence in this instance is strongly recommended. If you can handle the expense of a home in Provincetown then you may want to hold it until the market rebounds, which it will inevitably do. You may want to protect that strong equity position and watch it grow with the next upturn. In the meantime, you may want to rent it out for extra income, hire a management company to look after it and wait.
The market is such a buyer’s market that I’d hate to miss an opportunity. Follow up: Since I won’t be going to Provincetown nearly as much, should I sell the home? I bought it in the mid nineties, have a strong equity position and can be a realistic, competitive seller. "
A: What a great question for the current times. Let’s start by addressing the inquiry about renting or owning. The current real estate market is projected to remain soft for at least another year. You may want to find a rental unit in a suitable location for one year. In that time you will determine which neighborhood in Chicago suites your lifestyle and real estate needs. One year should also be telltale as to whether the job you accepted is going to work out. You may find yourself not liking Chicago or the job.
The first half of 2008 was strong for Provincetown sales. We have seen a correction of about 10+% decrease of value in most cases. If you don’t have to sell than exercising prudence in this instance is strongly recommended. If you can handle the expense of a home in Provincetown then you may want to hold it until the market rebounds, which it will inevitably do. You may want to protect that strong equity position and watch it grow with the next upturn. In the meantime, you may want to rent it out for extra income, hire a management company to look after it and wait.
Thursday, July 17, 2008
Wait to Buy?
Q: "If I wait until the late fall or winter to buy, will prices be lower?"
A: Buyers often ask us if prices decrease during the winter on the Outer Cape. It’s a good question, but the answer is contrary to what you might expect. Even though our local population diminishes during the cooler months, the real estate market on the Outer Cape is active year round, and we don’t see a seasonal shift in pricing. In fact, one of our busiest periods traditionally falls in January, right after New Year’s. Determined buyers often begin their search during the winter months so that they can be assured of summer occupancy in their new properties.
There are a couple of aspects to the market, however, that you might observe to be seasonal. We tend to see a slight increase in market inventory immediately following the summer season. Owners often think about listing their property at the conclusion of one rental season, and prior to the next. Another ‘trend’ that we have seen is increased activity in the Commercial market during the winter months. Future business owners tend to shop for and purchase property during our quiet months, in order to allow themselves enough lead-time to prepare for the summer crowds.
The best time for you to buy is when you find the perfect property! Remember that, in addition to being the ideal summer destination, the Outer Cape is a beautiful and restful place to visit in the quiet-season.
A: Buyers often ask us if prices decrease during the winter on the Outer Cape. It’s a good question, but the answer is contrary to what you might expect. Even though our local population diminishes during the cooler months, the real estate market on the Outer Cape is active year round, and we don’t see a seasonal shift in pricing. In fact, one of our busiest periods traditionally falls in January, right after New Year’s. Determined buyers often begin their search during the winter months so that they can be assured of summer occupancy in their new properties.
There are a couple of aspects to the market, however, that you might observe to be seasonal. We tend to see a slight increase in market inventory immediately following the summer season. Owners often think about listing their property at the conclusion of one rental season, and prior to the next. Another ‘trend’ that we have seen is increased activity in the Commercial market during the winter months. Future business owners tend to shop for and purchase property during our quiet months, in order to allow themselves enough lead-time to prepare for the summer crowds.
The best time for you to buy is when you find the perfect property! Remember that, in addition to being the ideal summer destination, the Outer Cape is a beautiful and restful place to visit in the quiet-season.
Thursday, July 10, 2008
A Fully Furnished Sale
Q: "I am selling my condo in the East End of Provincetown fully furnished. Is there significant value in doing so?"
A: This is a good question that many sellers are on the fence over. The best way to determine value is by attaching an executed offer to it, no matter what you are selling. If you have no need for the furnishings and your home is for sale, than list it as furnished. You’ll have to spend money having it cleared out if the buyer doesn’t want it. Or you can sell it furnished and let the buyer have it all. There is a perceived value by certain buyers when furnishings convey, but whether or not it is of real value can only be determined on a case by case situation.
In our experience, when furniture does convey, it is in excellent condition, relatively new and part of a tasteful décor.
A: This is a good question that many sellers are on the fence over. The best way to determine value is by attaching an executed offer to it, no matter what you are selling. If you have no need for the furnishings and your home is for sale, than list it as furnished. You’ll have to spend money having it cleared out if the buyer doesn’t want it. Or you can sell it furnished and let the buyer have it all. There is a perceived value by certain buyers when furnishings convey, but whether or not it is of real value can only be determined on a case by case situation.
In our experience, when furniture does convey, it is in excellent condition, relatively new and part of a tasteful décor.
Thursday, July 3, 2008
High Speed Re-Fi?
Q: "I am in the process of refinancing my home. The loan has been in the underwriting department for a few weeks already. Apparently, the appraisal process is taking an abnormally long time. Is there anything I can do to speed this process up?"
A: You are not alone. Due to the chaos in the mortgage industry, refinancing a mortgage can be next to impossible. You must make sure that you have enough equity to refinance. The part of the process that is hindering your effort, the appraisal, can take an undeterminable amount of time. Investors want to see accurate comparable sold properties to determine value. Appraisers are having a difficult time in one segment of the market obtaining this information due to low sales. Basically, there is nothing to compare the subject property to in order to determine value. Usually, an appraiser will use comparable properties that have sold within the past six months. Banks are now asking appraisers to provide comparable properties that are still for sale, expanding beyond the normal geographic radius and potentially using comparable sold properties from within one year.
These are truly challenging times for homeowners seeking to refinance. However, with the rates as low as they are, there is value if the loan clears and you put on a patience cap during the process.
A: You are not alone. Due to the chaos in the mortgage industry, refinancing a mortgage can be next to impossible. You must make sure that you have enough equity to refinance. The part of the process that is hindering your effort, the appraisal, can take an undeterminable amount of time. Investors want to see accurate comparable sold properties to determine value. Appraisers are having a difficult time in one segment of the market obtaining this information due to low sales. Basically, there is nothing to compare the subject property to in order to determine value. Usually, an appraiser will use comparable properties that have sold within the past six months. Banks are now asking appraisers to provide comparable properties that are still for sale, expanding beyond the normal geographic radius and potentially using comparable sold properties from within one year.
These are truly challenging times for homeowners seeking to refinance. However, with the rates as low as they are, there is value if the loan clears and you put on a patience cap during the process.
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