I’ve
been getting calls
from
sellers that are happy to hear that the market is turning around in
Beaverton,
Oregon, and they want to put their home on the market now.
They have
been
watching the news for the past couple months so they know pending home
sales
are up in Beaverton and since summer prices normally rise, as do sales,
they
are ready to sell their home.
The local media took a lot of bashing over the past two years for bashing the real estate market and now that they found a bit of good news they are all over the band wagon of giving good stats. The one statistic they found that was good was pending sales are up… way up, almost up 1/3 over the past three months
There is only one problem with these statistics being brought to you by your local media. Though pending sales are up, actual closed sales in Beaverton haven’t changed. Meaning more people are putting offers in and more of these offers are being accepted, but I believe because of all the new government regulations like the new appraisal law and underwriting guidelines, these pending sales are not getting to the closing table.
I went back trough the statistics for the past three months and sure enough each neighborhood had pending sales up 10 to 15 homes per week more per neighborhood than in the previous three months, but the number that didn’t increase was the closed sales. They still were averaging 1 to 2 per week.
The government that is there to “HELP” is actually hindering sales and making it harder and harder to close. Even the best buyers are having problems with just ridiculous guidelines that have been put in place. If the government wants the market place to fix itself, then they need to get out of the way and let sales happen.
What have you seen your market place? Has the new government guidelines hindered your sales or even caused sale fails? I would love to hear your stories of the government trying to help actually hindering sales.
Todd Clark - Broker / Sales Coach
Palazzo Realty Group
Phone: (503)524-9494
Fax: (503)622-8739
Todd Clark and the Friendly Home Team
Knipe Realty
Todd@IFoundYourNewHome.com
Phone: (503)524-9494
Fax: (503)622-8739
I am a licensed Realtor who specializes in Washington County, Oregon and also work in both Clackamas and Multnomah Counties including the cities of Aloha, Beaverton, Canby, Clackamas, Gladstone, Gresham, Happy Valley, Hillsboro, Milwaukie, Oregon City, Sherwood and Tigard.
All information contained in these posts are copyrighted and cannot be used without prior written approval authorization from the author me Todd Clark. If you are looking for an outstanding agent please give me a call I would love to help you with all your real estate needs.
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Same thing here. Pendings have little value these days. Closed sales are the only measurement of a market and they are sad, sad.
In our area we call them contingent and they don't go to pending until all contingencies are removed. But, in essense the same thing is happening here. To get someone to the closing table is Hard and tons fall through after the appraisals.
Todd,
The market is operating differently today than it did a few short years ago. Yes, pending sales are up in our area too but no, they're not closing at the same rate they have in the past.
Rich
Todd, I recently had a buyer close on a condo in which the appraisal shocked the heck out of me. Sold data all within 90 days: $117,000, $118,500 and $112,000.
Her offer was $105,000 and I still sweated the appraisal. (It came in at the sales price.)
We're seeing much the same here as you are: Pending homes going back on the market more often than ever before.
Todd,
It ain't over till its' over... I'm getting the same inquiries from sellers in Sussex County who are waiting until things have improved. The data on homes that actually sold is no better.
Perhaps some good press, however, might help things along!
Todd:
Interesting post. Same thing is happening in this area. A lot of what is happening is perception, so the good news is that more people are willing to put their houses for sale, and buyers go shopping. Like you said, now we just need the goverment to get out of the way.
Tere
We're still in the middle of selliing and closing foreclosrues like hot cakes. Stats come out today but my guess is we're up about 60+ percent in closings from last year. That is certainly true for my office.
Our pending sales are currently the highest they have been in two years. However I think this because ONE buyer is writing offers on multiple houses because our closed sales haven't changed much either. I'm sure the government plays a role too, but in our area I think it's the buyer's playing the field.
In Oklahoma City we have had a strong uptick in closed sales in the last 30 days. Our inventory level is very reduced, especially in the new home sector. Prices have been holding even though an overall 15% reduction in closings from last year, shows that there is no reason to declare the crisis over. For the first time in a decade, appraisals are coming in short. Our personal experience with HVCC has been okay, but in some cases appraisers from out of town are hired by out of state lenders, and they do not subscribe to our MLS, so their models for comps are very flawed. This seems to me to be a violation of the intent they had with this change.
Great point Todd. If the closed sales remain the same, which anecdotally I have heard much the same around the country, have we really made any progress? I like your analysis that a chief cause is the delays caused by the government programs.
Hey Todd! I just had an experience that should have been a smooth as silk transaction but was a lot of extra work to get closed...it started off a 48% LTV but then the appraisal came in low! A bad appraisal in my opinion and luckily also in the eyes of the buyer who still wanted to close. This buyer was a retired VP from Bell South and the LTV only changed to 54%. It ended up costing the Seller a great deal because they agreed to finish an unfinished room to bring up the square footage and improve the value. It did get closed but was delayed several weeks. My thought was...if it is like this with a squeaky clean perfect credit/great ratio buyer putting down almost 50% what is it going to be like with an average median income family?
Kinda scary!
Thanks for your post!
Todd: Very true. As they say, a deal doesn't count until it's closed. Things are still tough out there; even on the refinance side. The bottom line is I believe a deal can ultimately get done. It just may take a while these days and borrowers, buyers, etc. need to be patient and flexible. Eventually it will get easier again. I expect sometime next year, guidelines will ease again. I just hope we don't go back to the Wild West days of the earlier 2000's! Thanks again!
A lot of the same is happening a little ways down I5 in Southern Oregon. There's a lot of offers and pending sales out there, but there's still HUGE inventory, and not that many closed deals.
The media reporting the market is climbing and thereby prompting people to add their houses to the ever growing list of available properties is going to do exactly the opposite and reduce values again.
The government and their regulations and guidelines, dont get me started. Things get worse when the government gets involved, never better. Short term gain at the cost of long term guaranteed catestrophic failure is not a good option in my opinion. Clearly the fed disagrees though.
Todd, Media deception is not new but sure gets old after a while :)
I agree with Missy ~ getting offers to the table and closed is the trick and it is not easy! I have seen many properties that have received multiple offers end back up on the market a few months after they sat "pending" in our MLS!
Between getting actual loan approval, getting the home to apprais for the asking price and keeping the buyers on track and happy during the process can be a challenge!
Todd, in this market no home is considered sold under the final piece of paper has been signed at the closing table. We want to share in the excitement with our clients when their home is put under deposit but we still let them know we have a long road ahead of us before they have sold. The market is getting better but every transaction is taking more time.
Todd,
My market is also showing a lot of "pending" sales, but it doesn't mirror the settled sales!
Kathy Opatka
Todd -- AgentOwned has been watching this very closely --- we are seeing Buyer sales up significantly, but not the closings. You are right, it is the government interfering with the ability to get financing.
BTW -- Congrats on your feature.
Interesting. I've never paid any attention to pending sales because, as Lenn pointed out, it's not the pending sales that matter, it's those that actually close.
That said, if I compared last year's sales numbers to this year's sales numbers, I would see a decline still...but if I were to narrow the time (like, say, the last three months), I could argue that sales are picking up in some places. The porblem though is that more inventory is being added at the same time, which means no lessening of inventory.
I am not sure you can blame it on the government, I am usually the first person to do so. I think the big mortgage companies like Wells Fargo, Bank of America e.t.c are being very conservative these days on who they will loan money to. I don't believe the government is setting the rules at all, the perception with everyone is that they are. Sure they have to lend money based on Fannie and Freddie guidelines which yes are now being run by the government. In the end get used to it this is the way it is going to be in the lending industry for years to come.
Todd...
I have no idea what their not telling me. I'm quite sure I'd rather not know anyway :)
TLW...ROAR!
Todd - I agree with William who is in Connecticut like I am. While there are some pocket areas that are seeing a bump up in sales until we see the amount of inventory go down and the banks streamlining the short sale process, I think we have a way to go before we see things start to get better.
Besides just stating the raw statistics there are so many other variables that are not mentioned, like the number of homes being bought and sold in the entry level price range and few families upgrading their homes. Here in the Sacramento area if your looking for a home under $250,000 or so there is tremendous competition - and has been for well over a year. Good homes sell in DAYS if they are REO. Even short sales are starting to pick up. But over that price range it's stagnant still. I can look at the same MLS sales figures and spin it any one of 8 different ways.
Jeff
Todd you are very correct on this and I think the banks actually want the government involved because then they don't have the risk because the government will eventually own all the loans.