How Is the Real Estate Market?
How is the housing market in our neighborhoods?
Over the past several years we have watched housing prices decline. Pleasant? Of course not. However, it is only an issue if you are in the position of having to sell your home. Please consider: a home provides shelter. It is not an “investment”, because in any matter you need to have a roof over your head. In the past several years we seem to have lost sight of this. If you compared the holding costs of a home in North Collinwood, factoring in the tax and shelter benefits, you would see that the housing value is significant.
Are houses selling? Yes, if they are in good condition, with good updates, and priced well, they sell.
Are the City employees leaving the city? Yes, some, are moving. However, other city employees- understanding the housing values and income tax benefits – continue to move into our neighborhoods.
Has the price of homes fallen? Yes, the average sale price of a single family home in Zip Code 44119 North Collinwood was $46,800 in 2010 from Jan 1- Aug 1. The average list price was $84,600. In 44110 The average sale price was $28,000, and average list price was $64,000,. This is a far cry from the selling price of homes during the height of the “bubble” in 2005-2006.
What is a “Short Sale”? Suppose an owner needs to sell their home due to a hardship condition, and the home has a market value of less that what is owed on the mortgage; if the bank agrees to accept the proceeds of a sale at a lower price than what would pay off the mortgage, that is a “short sale”.
What is a “Strategic default”? When a homeowner, knowing that the current market value of their home is LESS than what they owe on the home, intentionally stops paying their mortgage, leading to a bank foreclosure. (The actual foreclosure process may take up to 2 years.)
What is a “Flipper”? – Someone who buys a house, does not substantially improve it, but re-sells it for a much higher price, often to an unsuspecting third party.
What is a “Defensive purchase”? Neighbors buying a foreclosed home to prevent a “flipper” from being able to buy it. Oftentimes they renovate it and are able to sell it at a higher price.
What is the highest sale in the North Collinwood area this year? A house sold for $250,000. (lakefront house – nicely updated! )
What is the lowest sale? A house sold for $8000.
Who are buying? Creative, artsy people. There is also significant out-of-town investor activity. And of course, anyone who loves the lake and had dreamed of living nearby the lake. Generally today’s buyers are either very well qualified by their lender, or purchasing “cash” with funds they have saved up.
Interested in additional info? Send your general questions to the Observer, or if you have a specific question, please feel free to email me at Vilija@nasvytis.com.