Lots Of Homeowner Equity!
Wednesday, February 24, 2021
Add Comment
Real Estate Information Archive
Blog
Pages:
Displaying blog entries 331-340 of 512
Where Have All The Houses Gone on Mt. Hood?
Monday, February 22, 2021
Where Have All the Houses Gone?
In today’s housing market, it seems harder than ever to find a home to buy. Before the health crisis hit us a year ago, there was already a shortage of homes for sale. When many homeowners delayed their plans to sell at the same time that more buyers aimed to take advantage of record-low mortgage rates and purchase a home, housing inventory dropped even further. Experts consider this to be the biggest challenge facing an otherwise hot market while buyers continue to compete for homes. As Danielle Hale, Chief Economist at realtor.com, explains:
“With buyers active in the market and seller participation lagging, homes are selling quickly and the total number available for sale at any point in time continues to drop lower. In January as a whole, the number of for sale homes dropped below 600,000.”
Every month, realtor.com releases new data showing the year-over-year change in inventory of existing homes for sale. As you can see in the map below, nationwide, inventory is 42.6% lower than it was at this time last year:
Does this mean houses aren’t being put on the market for sale?
Not exactly. While there are fewer existing homes being listed right now, many homes are simply selling faster than they’re being counted as current inventory. The market is that competitive! It’s like when everyone was trying to find toilet paper to buy last spring and it was flying off the shelves faster than it could be stocked in the stores. That’s what’s happening in the housing market: homes are being listed for sale, but not at a rate that can keep up with heavy demand from competitive buyers.
In the same realtor.com report, Hale explains:
“Time on the market was 10 days faster than last year meaning that buyers still have to make decisions quickly in order to be successful. Today’s buyers have many tools to help them do that, including the ability to be notified as soon as homes meeting their search criteria hit the market. By tailoring search and notifications to the homes that are a solid match, buyers can act quickly and compete successfully in this faster-paced housing market.”
The Good News for Homeowners
The health crisis has been a major reason why potential sellers have held off this long, but as vaccines become more widely available, homeowners will start making their moves. Ali Wolf, Chief Economist at Zonda, confirms:
“Some people will feel comfortable listing their home during the first half of 2021. Others will want to wait until the vaccines are widely distributed.”
With more homeowners getting ready to sell later this year, putting your house on the market sooner rather than later is the best way to make sure your listing shines brighter than the rest.
When you’re ready to sell your house, you’ll likely want it to sell as quickly as possible, for the best price, and with little to no hassle. If you’re looking for these selling conditions, you’ll find them in today’s market. When demand is high and inventory is low, sellers have the ability to create optimal terms and timelines for the sale, making now an exceptional time to move.
Mt. Hood has a limited inventory of only six properties for sale between Government Camp and Sandy. This is the best time to have your Mt. Hood property for sale!
Bottom Line
Today’s housing market is a big win for sellers, but these conditions won’t last forever. If you’re in a position to sell your house now, you may not want to wait for your neighbors to do the same. Let’s connect to discuss how to sell your house safely so you’re able to benefit from today’s high demand and low inventory.
Mt. Hood Real Estate Sales for January 2021
Thursday, February 11, 2021
January 2021 had a huge amount of sales closing on Mt. Hood. Nineteen properties closed for the month! Considering there are only five properties even for sale today, this is an amazing amount to close for the start of the year. It'll be interesting if the inventory doesn't pick up soon. Most veteran agents have never seen anything like this before. Eight of the mountain sales were over $500,000!
Here are the sales for January:
We're Not in a Housing Bubble on Mt. Hood
Tuesday, February 9, 2021
3 Reasons We’re Definitely Not in a Housing Bubble on Mt. Hood
Home values appreciated by about ten percent in 2020, and they’re forecast to appreciate by about five percent this year. This has some voicing concern that we may be in another housing bubble like the one we experienced a little over a decade ago. Here are three reasons why this market is totally different.
1. This time, housing supply is extremely limited
The price of any market item is determined by supply and demand. If supply is high and demand is low, prices normally decrease. If supply is low and demand is high, prices naturally increase.
In real estate, supply and demand are measured in “months’ supply of inventory,” which is based on the number of current homes for sale compared to the number of buyers in the market. The normal months’ supply of inventory for the market is about 6 months. Anything above that defines a buyers’ market, indicating prices will soften. Anything below that defines a sellers’ market in which prices normally appreciate.
Between 2006 and 2008, the months’ supply of inventory increased from just over 5 months to 11 months. The months’ supply was over 7 months in twenty-seven of those thirty-six months, yet home values continued to rise.
Months’ inventory has been under 5 months for the last 3 years, under 4 for thirteen of the last fourteen months, under 3 for the last six months, and currently stands at 1.9 months – a historic low.
Remember, if supply is low and demand is high, prices naturally increase.
2. This time, housing demand is real
During the housing boom in the mid-2000s, there was what Robert Schiller, a fellow at the Yale School of Management's International Center for Finance, called “irrational exuberance.” The definition of the term is, “unfounded market optimism that lacks a real foundation of fundamental valuation, but instead rests on psychological factors.” Without considering historic market trends, people got caught up in the frenzy and bought houses based on an unrealistic belief that housing values would continue to escalate.
The mortgage industry fed into this craziness by making mortgage money available to just about anyone, as shown in the Mortgage Credit Availability Index (MCAI) published by the Mortgage Bankers Association. The higher the index, the easier it is to get a mortgage; the lower the index, the more difficult it is to obtain one. Prior to the housing boom, the index stood just below 400. In 2006, the index hit an all-time high of over 868. Again, just about anyone could get a mortgage. Today, the index stands at 122.5, which is well below even the pre-boom level.
In the current real estate market, demand is real, not fabricated. Millennials, the largest generation in the country, have come of age to marry and have children, which are two major drivers for homeownership. The health crisis is also challenging every household to redefine the meaning of “home” and to re-evaluate whether their current home meets that new definition. This desire to own, coupled with historically low mortgage rates, makes purchasing a home today a strong, sound financial decision. Therefore, today’s demand is very real.
Remember, if supply is low and demand is high, prices naturally increase.
3. This time, households have plenty of equity
Again, during the housing boom, it wasn’t just purchasers who got caught up in the frenzy. Existing homeowners started using their homes like ATM machines. There was a wave of cash-out refinances, which enabled homeowners to leverage the equity in their homes. From 2005 through 2007, Americans pulled out $824 billion dollars in equity. That left many homeowners with little or no equity in their homes at a critical time. As prices began to drop, some homeowners found themselves in a negative equity situation where the mortgage was higher than the value of their home. Many defaulted on their payments, which led to an avalanche of foreclosures.
Today, the banks and the American people have shown they learned a valuable lesson from the housing crisis a little over a decade ago. Cash-out refinance volume over the last three years was less than a third of what it was compared to the 3 years leading up to the crash.
This conservative approach has created levels of equity never seen before. According to Census Bureau data, over 38% of owner-occupied housing units are owned ‘free and clear’ (without any mortgage). Also, ATTOM Data Solutions just released their fourth quarter 2020 U.S. Home Equity Report, which revealed:
“17.8 million residential properties in the United States were considered equity-rich, meaning that the combined estimated amount of loans secured by those properties was 50 percent or less of their estimated market value…The count of equity-rich properties in the fourth quarter of 2020 represented 30.2 percent, or about one in three, of the 59 million mortgaged homes in the United States.”
If we combine the 38% of homes that are owned free and clear with the 18.7% of all homes that have at least 50% equity (30.2% of the remaining 62% with a mortgage), we realize that 56.7% of all homes in this country have a minimum of 50% equity. That’s significantly better than the equity situation in 2008.
Bottom Line
This time, housing supply is at a historic low. Demand is real and rightly motivated. Even if there were to be a drop in prices, homeowners have enough equity to be able to weather a dip in home values. This is nothing like 2008. In fact, it’s the exact opposite.
Mt. Hood Land Swap
Saturday, February 6, 2021
The Mt. Hood land swap is back in the news! Negotiations between the U.S. Forest Service with land next to Government Camp and Mt. Hood Meadows owned Cooper Spur ski area continues. Two decades later it is back in the news with a final decision on the environmental impact by the Feds and a draft decision of terms.
This recent article in the Oregonian gives a good background on the history of the swap along with past and future challenges of the appraised values of the parcels.
If you would like to read the draft of the final decision the 40 page document is HERE.
Map of swap area
New Zig Zag Riverfront Cabin on Mt. Hood One Bedroom
Friday, January 29, 2021
There's FINALLY a new cabin on the market near Rhododendron in the Mt. Hood National Forest. It's in great condition with a newer septic system and riverside deck! This charmer has everything you could want for your Mt. Hood getaway. The open floor plan has tons of wood and log accents! A stone fireplace features a wood stove that will easily heat the entire cabin. Wood floors. $209,600
Its Time to Sell on Mt. Hood!––
Friday, January 29, 2021
Is Right Now the Right Time to Sell? [INFOGRAPHIC]
![Is Right Now the Right Time to Sell? [INFOGRAPHIC] | MyKCM](https://files.mykcm.com/2021/01/29101958/20210129-MEM-1046x1262.png)
Some Highlights
- If you’re on the fence about selling your house, now is a great time to take advantage of sky-high demand, low supply, and fierce buyer competition.
- With buyer demand rising and historically low inventory for sale, if you’re in a position to move, your house may really stand out from the crowd.
- Let’s connect today to get your homebuying process underway.
Mt. Hood National Forest Storm Damage
Friday, January 15, 2021
Here's the latest information for Mt. Hood National Forest Cabin owners concerning our recent wind and rain storm:
Summer Recreation Residences
January 12- 13 Storm Damage Alert
Due to the wind and rainstorm, there are many downed trees and downed power lines in the recreation residence tract. PGE and forest employees are working on clearing roads, prioritizing those who are trapped behind storm debris. This work will take several days. In the meantime:
- Please postpone a visit to cabins. There are many safety hazards in the area, including downed power lines.
- First responders and work crews are out working and making progress- it is very important to not impede their work or block roads.
- Road 12 (Still Creek Rd.) is blocked and requires heavy equipment to remove a giant downed tree.
- The Zigzag Ranger District and many of its employees are without internet, phones, and/or power.
- As staff gets safe road access they will assess recreation residences for damage and notify owners of discovered damage.
Pages:
Displaying blog entries 331-340 of 512
Syndication
Categories
- Government Camp Real Estate (755)
- Mt Hood Inspiration-Morning Coffee (256)
- Mt. Hood 1031 Tax Exchanges (75)
- Mt. Hood Economic Conditions (825)
- Mt. Hood Local Events (366)
- Mt. Hood Mortgage and Financing Information (408)
- Mt. Hood National Forest Cabins (512)
- Mt. Hood New Properties on Market (310)
- Mt. Hood Sales Information (357)
