April continued to show the strong activity level we have seen during the first quarter. The actual rate of sales on an annualized basis did slow however. It is too early to tell if that change is significant, it could have simply been weather related. Compared to last April sales were off about 15%, but last April was a peak tax credit month, so a 15% decline is not a bad number and not unexpected. Here's the interesting piece. In most every metro Detroit market we continue to see six year lows in the Months Supply of Inventory (MSI). It may be that some of the growth slow down from March to April was simply there were not enough salable homes to purchase.
It is tough to tell just how much of the increasing activity could be a temporary spike vs. a permanent market uptick. We are certainly one of the strongest markets in the country. Regardless of which it might be, the strong activity makes this the best time to have your home on the market since 2005! So for anyone who is considering selling their home in the next 12 months, act now and act fast. Demand is rising, inventories are low as are interest rates.
Even though values appear to be strengthening, Sellers will still need to set their prices based on the most current sales activity. A home that was on the market last year at $75,000 over the then current market will still be overpriced today. Home values are bouncing off the bottom of actual comparable sales, not what the asking prices have been. We don't expect prices to jump dramatically (tough appraisal standards will keep a check on that) but there could be some nice bidding wars for well priced and conditioned homes bringing prices off their bottoms from last year.
Another thing to keep in mind is that buyers are still being very picky. Homes that are not updated or in great condition are still sitting on the market or going for below asking price. If possible, a Seller might consider using a FHA 203K rehab loan as a refinance to help fund their updates for a more salable home.
Another issue that has gotten some press is the MERS (Mortgage Electronic Registration System) foreclosure problem. The core issue is the willingness for title insurance companies to write a title policy on bank owned homes that used MERS in their foreclosure process. It is too early to tell if this will be a significant issue but there have been a few banks that have taken their homes off the market until they can determine their title insurance status. It may have the effect of squeezing the available home inventory even further and in some cases causing a postponing or canceling of a sale if title insurance cannot be provided to the buyer. For current Sellers it would be a good idea to have your old title policy handy just in case there was a MERS foreclosure in your title history.
Many of you do this now, but as a reminder, be sure to prepare for all of your appraisals in advance. Research your comps, including pending sales and be prepared to walk through them with the appraiser at the property. With so many of our strong listings selling for at or even above list price, appraisers will find it tough to keep up with the market without our help.
If you don't remotely know how or where to begin with implementing any of these, come work with us. We already have a system that does it all for you! Including our new - 1st To Know Mobile Text and Email. This allows the consumer to text the address of any active listing, no matter who the broker, and be sent the entire listing information on their mobile device. Contact us to learn more.
The best in their field, even professional athletes take advantage of coaching. If you would like the benefit of working with a full time coach, absolutely free to you, please call me directly or email to set up an interview.
(313) 516-6644
suzanneo@realestateone.
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