2013 Year End Wrap Up

Terravita Housing MarketIt is that time of year to look back over 2013 sales and see how we compared to 2012 and how we are doing in the economic recovery process.

Although we hoped Terravita would top 2012 total sales, we came very close.  In 2012, Terravita had 102 and  98 sales in 2013. Our actual dollar volume was up 6% from $46 million to $50 million.  The average sale price rose 12% from $459,343 in 2012 to $516,348  in 2013. Important to note that the home values rose in double digit percentage points at 12%.  Sales also sold closer to listed price from 96% of list price in 2012 to 97% of list in 2013.  It is definitely an indicator if you price the property with laser accuracy from the beginning, then the Days on Market will be less.  The case in point is that Days on Market in 2012 was 128 days and in 2013, Days on Market dropped to 74, a drop of 42%.

These are all positive signs that we are returning to a market of normal appreciation in the 5-9% range, steady sales and reasonable list to close days of 75-90 days and an 8-9 % turnover rate.

Other economic factors to keep on our watch list includes the composition and future policy plan of the Federal Reserve. The new Federal Reserve Chairman  Janet Yellen and her choice for Vice Chair, Stanley Fischer, the new Board’s policies are yet to be determined.   Chairman Yellen’s philosophy is in many ways akin with former Chairman Bernanke, to create consumer confidence in the present by committing to short term future policy positions. Vice Chair Stanley Fischer expresses a forward guidance policy but rather based on conditions in the future rather than set dates or times.  The months ahead will see the new Board’s policies unfold.

Another piece in the puzzle of the housing recovery is the impact of the  current implementation of the Dodd Frank legislation.  The following observations are most probably going to occur:

  1. Buyers will need, more than ever to make complete loan application before beginning to look at homes.
  2. Buyers will need to respond to lender requests with the utmost sense of urgency since certain time lines must be met or the entire application must start over.
  3. Not all loans will have to fit into the “Qualified Mortgage” box of requirements.
  4. Investment properties will come under greater scrutiny, require more down payment and more time to approve.
  5. Any changes in the loan package will trigger a several day Buyer review requirement, thus lengthening the time for approval.

However, all these new conditions will not really change anything for the Buyer as long as they are committed to following the guidelines and instructions of their loan officer.  If you are thinking of Buying or Selling in the coming months, having a strong Loan officer on your team is critical.  I would suggest that a call to Brian Cardenas at AmeriFirst Financial ( phone …   & email….    ) will give you answers to your questions and a sense of confidence in getting your purchase or sale completed with a strong team by your side.