Bobbie's Blog: When are home prices going to rise

Please read the article below that I copied in full.

Everyday I get asked by sellers and homeowners "When are we going to be out of this?" Well if we use the information below as a guide by 2009 home prices will be finally steady.

The next most common question I here from Sellers is "The spring market is the best market should I wait till then to sell?" The answer to that would be a big "NO!!" If you wait until Spring you could lose an additional 2% more than now!

Than I hear "If I wait to sell a couple of years the market will be back." In a couple of years the market will no longer be declining and finally staying steady. If we go by the opinion below your home will be worth a full 4% less in a couple of years than it is today. And that is not taking into consideration depreciation based on condition. Roofs, furnaces, windows have all aged in that time and maybe getting to the point of replacement. 2-3 years can be the difference between having to replace a roof or selling it the way it is.

We are in a market of "Equity Preservation". By that I mean when you price your home you want to underprice your competition AND price your home lower than recent sales.

"WHAT?!?!" you're now screaming.

Let me explain.

We are currently losing value of 0.5 to 1% per month. A recent sale is one that has closed in the last 3 months, better yet the last month. Like I just said it is a sale that has CLOSED. Well that means that the offer to purchase was made 1-2 months prior to the closing. So if we take a sale that closed 1 month ago on an offer that was accepted 2 months prior that is a 3 month period of further depreciation. At 1% per month that is a full 3% of loss. If you price your home at or above the Sale price of that recent sale and your home sits on the market for over 30 days your home has now lost 4% in value.

A well priced home will sell and will sell quickly.

That is Equity Preservation.

Bankers: Worst is yet to come ( BOSTON ) – The chief economist for the Mortgage Bankers Association is advising members not to expect a recovery in the housing markets until 2009. The MBA’s Doug Duncan says he expects national median home prices to fall between 2 percent and 4 percent next year because of an oversupply of homes from foreclosures. Duncan said California , Texas , Arizona and Nevada would be the hardest-hit states because of speculation by investors, while Ohio , Michigan and Illinois would follow because of job losses. He said he expects mortgage originations to be off 15 percent this year and another 18 percent next year. Reprint from U.S. News.

I can help you with every aspect of buying or selling your home because I’m experienced, because I’m professional . . .and because I care. The relationship between a home buyer or seller and their agent is based on trust, shared goals and understanding. I strive to continually improve and to do this I listen and take the needs and wants into consideration. I'd love to hear from you!