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Is the glass really half empty?
Sometimes its hard to know if the glass is really half full or if its half empty. Being an optimist myself, I’m usually looking for the half full point of view. Each morning before writing a new post I read real estate headlines and stories from all across the country. Usually there are a few optimists out there. Today seemed a little different. MSNBC headline covers Countrywide’s loan delinquencies troubles. Inman News headline states housing demand falling faster than home inventory. CNN money headline housing: no room for bulls. Real Estate Journal headline states new blows hit housing industry.
"Oh my, that all sounds bad!"
Is it really half empty? From the sound of those headlines the real estate market’s glass is completely empty. But I refuse to believe its all bad. Take for example this headline Mortgage rates fall below 6% on MSNBC. Now that’s good. Rates haven’t been below 6% in almost two years. There is even talk that the Federal Reserve Board may drop rates again at the next meeting to head off the big "R" word. Yes, recession. Recession talk heated up this week when the new unemployment figures came out higher than expected. That’s another headline for the glass is half empty column. Read about the economy if you don’t mind being discouraged.
If rates are cut again by the Fed and they go into the low 5% range. Houses become very affordable. Check out this mortgage calculator from Bloomberg.com.
The mortgage payment on a $150,000 home (Beaumont’s median home price) at 5.5% is less than 900 per month P&I. That gets pretty attractive for anyone still paying rent or anyone wanting to move up to a home a little bigger than the one they are in now.
Even though its hard to find the silver lining sometimes, just remember when all the national media starts saying the same thing that is usually when things are about to change. Who doesn’t remember the stock market headlines of 2000 when the media was still touting how full the glass was. That was right before the stock market glass was not just emptied it was dropped on the floor and shattered into thousands of little shards.
So I invite you to share your thoughts. Is the glass that is the real estate market full, empty or about 1/2? Let me know what you think.
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Country Club Living
If you are looking for country club living in Beaumont, then you will want to look at Brentwood Country Club. The land was originally purchased in 1996 from the Willow Creek developers since then just about everything has been renovated. If you are a golfer the course has been voted best course in SE Texas several years running by readers of the Beaumont Enterprise.
If you are looking for a great place to call home then this could be it.
There are currently 8 active listings. Prices range from $209,900 to $399,000. For $209,900 you will get a new 4 bedroom 2 bath home with approximately 2000 square feet of living space. If your budget can stretch to the $399,000 price, you will get a new 4 bedroom 3.5 bath home with approximately 3200 square feet of living space. If you are dreaming of golf course frontage, you may have to wait. Right now none of the homes on the market have frontage on the course. There are a few cul-de-sac home-sites available.
"If you are curious about 2007 sales activity read on."
There were 41 closings in 2007. The least expensive home that closed last year was on the market for $167,500. It only spent 11 days on the market. The most expensive home was on the market for $300,000 and it spent 191 days on the market. If you total all 41 closings the median price was $230,000 with an average 105 days on the market. Prices are going up especially the brand new construction. 4 of the 8 homes that are currently for sale are priced above $300,000. So far this year only one home that is on the market has been for sale for more than 3 months. Surprisingly, it is one of the least expensive priced at $209,900.
If you are interested in school zones for Brentwood Country Club which is also referred to as the original development name of Willow Creek you can find out which schools cover the neighbor at BISD attendance zone. For those into social activities – tennis and golf- the lifestyle is a great fit. There are weekly tennis lessons and golfing all year round. There is also a restaurant in the club.
So if you are ready to start living the good life, its time to go look at the homes for sale in Brentwood Country Club aka Willow Creek.
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U.S. National median home price is $220,040
Would you guess the real estate market peaked over 2 years ago? According to WSJ.com the national housing market hit its peak in Q4 of 2005. Just over two years ago. Since then the real estate market in most parts of the country has remained relatively flat or has fallen. Our area, Beaumont-Port Arthur, is one of the few that has bucked the national trend. The median price of homes in our area according to The Wall Street Journal On-line is approximately $120,000. Beaumont’s median price is closer to $150,000 according to information from the Beaumont Board of Realtors. However, the good news is our housing market is still showing upward movement in pricing. Prices now are 111% of what they were during the market peak in Q4 of 2005.
The Texas A&M Real Estate Center keeps track of the number of residential building permits for all Texas counties. Beaumont builders pulled 23 permits in the month of November 2007. This is an increase from the monthly average of 2007 by 32%. It looks like the builders still believe there is plenty of growth left in our market. The average price of new construction has been going up as of late. One report sited an average price of new construction to be in the $200,000-$300,000 range. If the trend continues with new construction prices going up this will also help keep prices in the resale market going up.
While most of the country may have seen a peak in their homes value back in Q4 of 2005, most Beaumont homeowners are most likely still enjoying the climb.
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More Texans by the day.
More people relocated to Texas in 2007 than moved away. United Van Lines publishes a study each year on which states people move to and where they move from. Texas got noted once again as an inbound migration state. A trend that started in 1989 and hasn’t stopped since. The 2007 United Van Lines Migration Survey also shows that our neighbor to the East, Louisiana also had a population increase in 2007. The Southern region of the U.S. came in first place with North Carolina taking the grand prize for most new residents. The South was followed by the West. In the western region of the U.S. Nevada had the strongest inbound relocation trend.
It is interesting to note that other migration studies show slightly different patterns of movement. The Dallas Business Journal Newspaper quotes a migration study done by Atlas Van Lines. According to the information released by Atlas Van Lines, Texas not North Carolina, had the highest number of inbound moves. The Atlas study also showed a decline in Florida residents while the United Van Lines study showed a small increase in Florida.
A Southeast Texas blog, the Bayou also mentions the Atlas Van Lines migration study. It seems like whichever migration study you read one thing is for sure. More people are moving to Texas.
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FICO ’08 – The way your credit score is calculated is changing.
Did you know 90% of the 100 largest banks use your FICO score to determine whether they will lend you money? Now in 2008 the company who created the FICO score is changing the way your score will be calculated.Fair Issac is the company that created the FICO credit scoring system. They will let you check out your FICO score at www.myfico.com. The Wall Street Journal explains the changes in the new 2008 scoring system.
Why are they making changes?
It seems demand from customers (IE: big banks) has prompted the change. The whole sub-prime meltdown has left the banks reeling and in need of a new way to assess the risk of lending money to someone with a "thin" or "relatively new" credit history. The scores will stay the same 350-800. The higher your score the better. According to Fair Issac most of us will see an increase in our credit scores. The big change is the way your credit information will be deciphered.
Consumers who have several types of accounts- credit card, car loan, home loan- who pay those on time will have the best scores. Consumers who have only one type of account won’t score as high. Those who let their payments fall 90 days behind will be penalized the most.
Want to check out your credit score?
Go to Free credit report . Experian will let you get a copy of your credit report and give you an explanation of your score. Fair Issac consumer information will help you analyze your credit and give you some helpful information on how to save money by increasing your credit score.
For those of us in the housing market today’s magic credit score is a 620 or higher.
Buyers with 620 and above credit scores get the best interest rates. They also have more loan programs available to choose from. There was a day- not so long ago- that even 550 was high enough to be approved for a home loan but the banks have tightened the ropes. They are still dealing with a rising foreclosure rate. They don’t want to take as much risk anymore.
The new scores start to be available this spring. If you plan to borrow money from a lending institution this spring or after, you’ll want to check out your credit score and see how the new FICO 2008 affected you.
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Neighborhood snapshot – zip code 77706
Zip code 77706 is a popular place to call home. This geographic area is bordered on the S. by Phelan Blvd., on the N. by Eastex Fwy., on the E. by 1-10, and on the W. by the Jefferson County line. It you are from Beaumont, you may have heard it referred to as the W’s. W2, W4 and W5 to be precise. Its convenient to Dowlen which runs right through the middle of 77706 which means you are in the heart of the shopping and dining district.
To analyze this housing market the following criteria were selected: homes priced between $150,000-$200,000, single family residences, 3-4 bedrooms.
Looking at the housing market since Oct. 2007 to today, there have been 17 sales. Currently, 6 homes are under contract also known as pending sales and there are 31 active listings. The average days on the market before one of these homes went under contract is 99. W2 does seem to move faster with less than 60 days on the market before going under contract. W4 is not far behind averaging less than 68 days on the market. W5 seems to take a little longer, pulling up the curve to 99 days for the whole area.
W2 homes sold for approximately 95% of their listing price. W4 homes averaged over 95% of their listing price. While W5 homes showed an average a little lower but still a strong average of about 91% of their list price.
If you are thinking of buying in this popular zip code you’ll need to act fast. Several of the homes were on the market less than 45 days. With so few days on the market, it often means these homes are sold before you will see them advertised in any magazines. The Internet keeps the most up to date information on which homes are new on the market. Even better for fast results is working with a local Realtor who gets daily updates of market activity and knows before anyone else when new homes come on the market.
For a detailed profile of zip code 77706 City Data provides some interesting information. Average age 39.7 years old. Median income is higher than the state average at $58,734.
Does it sound like the type of place you might like to call home? Your comments are always encouraged. Let me know what you think about living in 77706 or any other zip code in SE Texas.
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Housing Market: Is it up or down in 2008?
Happy New Year. Its the second day of 2008 and the debate has begun…or shall we say continues. Is this the year the National Housing Market starts to rebound? Or is it another year of decline?
Entertaining debate on Fox News about the housing market in 2008.
We all know the National Housing Market has been a hot topic in the press over the past year. One big problem is the housing market is not national. It is local. There are 1000’s of local housing markets all over the country. All with different trends for 2008.
Take my former hometown, Orlando, FL. The Orlando market, once a golden real estate market, is now suffering from the investor and builder bubble. A former colleague and good friend of mine writes a real estate blog about the Orlando real estate market. He posted an article today about with information from the The Florida Association of Realtors.
Now take our local area, Beaumont, TX. Our market is going strong. The Real Estate Center at Texas A&M keeps statistics on what is happening in local markets throughout Texas.
"Did you know Houston is now the largest housing market in the country?"
Over 44,000 permits for single family homes were issued between October 2006- 2007. That beat out Atlanta, Georgia by over 10,000 permits.
With job expansion at the refineries, low unemployment, and an increasing population the outlook for the Beaumont Real Estate Market is one of the best in the country.
"Enjoy listening to the experts debate but don’t let those national housing market stories get you worrying."
You are lucky to be living in SE Texas where home values are expected to increase in 2008.
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Acreage provides a little extra elbow room
Did the neighbors seem a little too close for comfort this holiday season? Maybe you’ve dreamed of having your own little slice of land one day. In SE Texas, if you want some acreage to call your own you are in luck because we’ve got land all around.
A quick look at the Beaumont Area Real Estate Market shows 50 properties that are for sale with acreage between 5 – 100 acres. How affordable are these properties you ask. Well, the price range is wide. The most expensive property currently for sale is listed for $789,000, located in Spurger with 80+ acres and 4750+ square feet of living space. Now, that’s a nice little piece of land. The least expensive property in the group is listed for $36,000, located in Chester with 6+ acres and a 2 bedroom 1 1/2 bath home. You might call it a fixer upper. The median price of all the homes listed is $224,000.
So where are they located?
Fannett has the most homes with 5 or more acres right now. They have 8. Tyler County and Vidor come in tied for second with 6 a piece. But you will find properties with acreage in almost all parts of the Golden Triangle.
Want to do a little home searching on your own?
Try Coldwell Banker’s website or Realtor.com. These sites allow you to search for homes from the comfort of your home. They are a great place to start searching before you are ready to go out and see some homes in person.
Not everyone wants to take care of land. Some of us would prefer the convenience of town home living. No yard to worry about. No grass to mow. Whatever your dreams of the perfect home are you can find it here in The Golden Triangle, you just have to know where to look.
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Happy Holidays
Enjoy the holidays…
If you take any great holiday photos here in SE Texas and want to see them on the blog, email them to me and I’ll run a post with the best SE Texas holiday photos. Check out more holiday photos at Flickr. I’ll be back with more SE Texas real estate news after Christmas.
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Selling your home in 2008
After the holidays have ended, the decorations are neatly boxed up, all the presents are open, and the relatives have left town, you may be one of many families in SE Texas that decide to buy a new home in 2008. If your plans call for a bigger home, smaller home, larger yard, better location in ’08, then you are in need of some "tips to help you sell your current home quickly and for a lot of money".
Here are 10 things you can do to help your home sell:
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On the outside- mow, trim trees and plant flowers.
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Paint touch ups – where ever needed.
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Clear out the clutter- get rid of unnecessary furniture, clear off counter tops, closets.
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Clean, Clean, Clean – carpets, tile, windows, any stains must go.
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Replace broken doors, knobs, tiles
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Freshen up the interior – no smoking inside, keep trash cans empty, use baking soda
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Flowers, Potpourri and Air Fresheners inside – neutral smells are a must.
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Invite a "friend" to walk through as a potential buyer. Get their opinion on whether or not your home is inviting.
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First impressions are made in the first 30 seconds before the potential buyer even walks through the door. Front door, steps, porch all make a good or bad first impression.
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Enlist the help of a professional real estate agent who can help you stage your home.
For more information on preparing your home for sale, view Coldwell Banker’s video on staging. The art of making your home look great inside and out.
In reality the market conditions, age of your home and location are going to play the most critical role in what price you can get for your home but following the 10 tips listed above will help you sell faster and maximize your sales price.
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Jefferson County homeowners may see higher insurance rates with State Farm
State Farm, the largest insurer of homes and cars in Texas has filed for a rate increase with The Texas Department of Insurance. The story covered by KFDM News states that State Farm is seeking an increase of 11.9%-13.8% in Jefferson County.
The Dallas News also covered the story. According to State Farm the increase request results from higher reinsurance costs that the company takes out to help cover claims from natural disasters. Some homeowners in non-coastal areas and those who have multiple policies may see a rate decrease according to State Farm.
Its all up to the Texas Department of Insurance. They have 30 days to decide whether or not to allow the increase. Recently, the Texas Department of insurance did approve a rate increase for the Texas Windstorm Insurance Association. In the approval it was stated the rate increase was granted to help build up the reserves of the fund.
If the Texas Department of Insurance approves the increase the new rates will go into effective March 1, 2008 for new business and May 1, 2008 for renewals.
