My New Blog

People are anxiously waiting for this housing decline to bottom out.  I know I will be glad.  I hate being the guy letting people know their house declined in value so that they owe more on their house than what it is worth.  I don't like being the bearer of bad news.

So the big question remains, "How long?"  The answer is, "No one knows."  Some of this will depend upon how long and how deep this recession lasts.  Unfortunately 2.8% of U.S. mortgages are now at least three months in arrears, up from 1.4% a year ago.  That rate is projected to peak in early 2009.  That is according to a new CNN report.  That's not good news. 

Also if this recession lasts more than three quarters and people loose their jobs it could be a lousy year for real estate.  And S&P/Case-Shiller home price index which tracts income and housing values believes that we are in for a 20% decline in home prices next year.  Another forecaster is looking at a 15% decline.  The fact is it can't help but decline.  The supply is too high, and the demand is too low.  It's basic economics.

So what do you do, if you have to sell?

• Wait it out.
• Make your place shine if you intend to sell.
• Price it below market to get people to look at it and buy it.

If you are buying....

• Look for home that have been listed a long time and drive a hard bargain.
• Improve your credit score.

It's just plain ugly.  The good news is that in some areas of the country activity is picking up because of the reduced prices.  And remember all real estate is local, so my advice is talk to a good appraiser to give you the scoop on what is really happening in the local market.  And PLEASE before you buy a house get it appraised to make sure you are not paying more than you should.  You hire the appraiser, and do it BEFORE you make an offer.  You could save thousands, and in this market that could be really important.

There were 65 closed MLS sales of non-watefront homes in Burnett County in the past six months.  The average sales price was about 114,000, and the median sale price was 94,500.  That is an aborption rate of about 10 homes per month.  There are 170 MLS listings on the market at this point.  This means that we have about a 17 month supply on the market. 

There were 60 closed MLS sales of non-waterfront homes in Washburn County in the past six months.  The average sale price was about 106,000 and the median price was 95,500.  This is an absorption rate of about 10 homes per month.  At present there are 175 MLS listings on the market.  This means that there is about a 17 month supply on the market.

These are stunning statistics and demonstrate just how slow the market is.  A healthy market would only have about a six month supply on the market.