Certified International Property Specialist – West Michigan welcomes the world home!

Certified International Property SpecialistGrand Rapids, Michigan is welcoming the world home as REALTORS expand their awareness about the world and global markets. The local association is currently hosting a national designation offered by the National Association of REALTORS to train local real estate agents about the benefits of becoming globally proficient and connected. Approximately 20 students are currently enrolled in the designation course which involves classroom time, a certain amount of practical experience with international transactions and some other requirements.

It’s especially good for me to participate in this class as it represents the fruit of seed from efforts in 2011 when the association created the International Committee. Today, this committee is active in enhancing awareness about the impact of globalization on the economy of West Michigan.

We have had the opportunity to serve people from all over the world. It is always an interesting and enlightening experience. It requires attention to detail and an awareness of some of the unique challenges that people from different parts of the world face. As an immigrant and New American, I have a real appreciation for the benefits of homeownership in America.

One of the challenges of the classroom experience is the danger of stereotyping as we seek to learn more about people whose experience differs. For instance, we’re having discussions about high context vs low context cultures. What’s emerging in the discussion is the fact that you cannot take generalizations too far. At the end of day, it’s about the individual and their culture – you can’t divorce one from the other. It’s a packaged deal.

Grand Rapids, Michigan Rated a ‘Best Buy” Real Estate Investment for 2015

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The housing market has stabilized in Grand Rapids, Michigan.  Gone are the days when investor traffic flooded the market and houses were being plucked up at rock bottom prices.  Although exceptionally low inventory throughout much of the past 18 months has been a challenge, home buyers are once again entering the market in a serious way.  There is ample reason to indicate that a foray into the real estate market in Grand Rapids, Michigan today is a prudent financial move.

According to a recent article in Forbes Magazine, Grand Rapids Mi is now ranked as one of the nation’s Top 20 Housing Investments.  The list was based on key indicators such as: employments opportunities, annual job growth, population and the calculation of an area’s Equilibrium Home Price or Income Price.   This Equilibrium Home Price is used as a tool to measure what the average home price in any given area would be absent distortions such as the housing crash of recent years.  A good score on this index provides investors with confidence that their investments are likely to garner a good return.

Another measure of the strength of the real estate investment sector in Grand Rapids, Michigan is the affordability index. According to statistics cited in the Forbes article, Grand Rapids, Michigan is currently under-priced by 23% when compared to similar areas across the country.  One of the advantages the West Michigan area has had is the fact that the market was never seriously overheated.  For the most part, appreciation rates were stable even during the wild upward swings that overtook many cities prior to the housing crash.  Although Grand Rapids was affected significantly by the crisis, housing has regained its losses and home owners are seeing steady gains in their home equity.

Additional factors which bode well for Grand Rapids, Michigan in terms of real estate investment include a strong rental market. Vacancy rates in the Grand Rapids area are very low. The growth of area colleges (in particular Grand Valley) and the influx of population moving into the area for jobs has created the perfect storm as it collided with people who had lost their homes during the housing crisis competing for dwellings as well.  Buyers in the Grand Rapids, Michigan area are finding that with low interest rates, it is often much cheaper to buy a house than it is to rent one.

Related Content:  11 Reasons Why People Who Don’t Live in Grand Rapids, MI Should Wish They Did!

Metro Grand Rapids, Michigan Quick Stats:

MSA: Grand Rapids-Wyoming, MI

Pop.: 1,016,603

Avg. Home Price: $149,123

Pop Growth (’10-’13): 2.8%

Jobs Growth (annual): 3.7%

Unemployment: 4.7%

Annual price growth: 8%

Over (+) or under (-) priced by: -23%

Home Price/Rent Ratio: 14

Click on the picture below for the slide show featuring all the “Top Best Buy’ cities to invest in real estate within the United States.  Contact Audu Real Estate by calling 616-791-0511 or e-mail:  info@audurealestate.com for more information.

Grand Rapids MI Where to Invest Capture

 

11 Reasons Why People Who Don’t Live in Grand Rapids, Michigan Should Wish They Did!

1. Small Town Comforts with a Big City Vibe…

Location, Location, Location…Grand Rapids, MI is a city where you can bask on a pristine sandy white beach, kayak down a lazy river, take a horse-drawn carriage through a thriving down town area and tour a historic neighborhood all within one day.  In fact, all of this within 30 – 45 minutes of driving time without the hassles of big city traffic.  Grand Rapids, MI is a place where people still smile and say ‘Hi’ and will often open the door for you to walk through first, especially if you’re carrying an arm full.

Architecture of Grand Rapids

2.  Art Prize & Beer City US

Yep!  Very few cities can lay claim to both.  But in Grand Rapids, MI citizens enjoy the flair and drama created by hundreds of artists from around the country and world lending their creative muse to public spaces throughout the community.  Art Prize is the world’s largest community art contest in which the citizens choose the winning entry by electronic vote.  Truly a democratic affair! As for the beer thing, Grand Rapids has won the nationwide vote for the best crafted beer two years running…2012 & 2013.

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3.  Maker’s Spaces & Cool Funky Creative Vibes

If you love to build stuff, create new things, innovate and invent – there are few cities of its size which offer what Grand Rapids MI does to the entrepreneurially inclined.  There’s a vibe that you can instinctively feel about Grand Rapids.  It’s citizens are curious souls.  Hardworking too.  There are several communities specifically geared towards working together to collaborate and invent.  These include:  Start Garden, The Factory and the Geek Group to name a few.

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4.  Gorgeous Green Space & Eclectic Art Sculptures

Green space abounds in Grand Rapids MI. The urban landscape is frequently punctuated with park benches to stop & rest awhile.  The city overseas over  1,200 acres in 71 city owned parks.  There’s also a lovely quirkiness about how Grand Rapidians decorate their outdoor spaces.  It’s not unusual to see gardens with numerous lawn ornaments, including dutch shoes.  In the heart of downtown, Rosa Parks Circle designed by famous renowned artist Maya Lin features ice skating in the winter and line dancing in the summer.

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5.  The Downtown Market

Opened a year ago in 2013, the Downtown Market is an eclectic spot where you can browse through fresh offerings from local farmers during three days of the week or shop throughout the week in the indoor market which features an array of different kinds of shops.  Where else can you find an all natural juice bar, a European Bakery, a Crepe Shop, Fish Market, Meat Market, Spicery, Coffee Bar, Wine Bar and take classes in yoga and gourmet cooking all under one roof? Oh and yes…there’s also a roof top garden where you can enjoy a view of the city and several restaurants to boot!

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6.  Awesome Eats & Sweets

Grand Rapids MI has truly become a ‘foodies’ town.  The Farm to Table concept has grown roots into the community and today, several great restaurants feature items sourced from local farms.  One of the most interesting cluster of restaurants to open in the area centers around the East Town Community just east of the downtown core.  Some of our favorites include: The Grove, Green Well, Marie Catrib’s, and Terra.  Downtown we recommend: Reserve, Osteria Rossa, Ruth Chris Steakhouse, Rockwell Republic and Six One Six. For lovers of international cuisine, there are a number of Indian restaurants, Mexican Restaurants and one of our favorites, a Persian themed restaurant Shiraz Grill which features live entertainment as well as excellent food.  Each year, the city showcases restaurants during Restaurant Week, a great opportunity to try out something new at a reasonable cost.

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7.  Affordable Housing & Unique Neighborhoods

Forbes magazine recently ranked Grand Rapids MI as the 2nd Best Place to Raise a Family in the United States.  The ranking was based in part  on Housing Affordability, Home Ownership Rates and Safety.  The median house price for Grand Rapids is $167, 000 according to recent data available from the Grand Rapids Association of REALTORS.  Lonely Planet dubbed Grand Rapids MI as its ‘TOP DESTINATION’ for 2014.  If you’ve been thinking about a vacation to an exotic locale with gorgeous sandy beaches, West Michigan with it’s pristine shoreline, wineries and orchards might be exactly what you need.  Living in an area where your mortgage note doesn’t require scrimping on your life style and in communities which take pride in their homes is a wonderful bonus. Housing stock covers a wide range including: downtown condos, apartments, suburban homes, historic homes, pastoral estates, row houses and gated communities.

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8.  World Class Entertainment & Fun Festivals

There’s always stuff to do in Grand Rapids MI.  In fact, the variety is surprising for a city of its size.  You can enjoy the opera, ballet or symphony or attend a concert or show at the Van Andel Arena or DeVos Hall.    The city features several Festivals which include: Laughfest, Festival of the Arts, Hispanic Festival,  Soul of the City, Oktoberfest and Art Prize.  For sports enthusiasts, there are dozens of golf courses within a 30 minute drive.  Sports teams include the Grand Rapids Griffins hockey team and the West Michigan White Caps, an affiliate of the Detroit Tigers.  If you’re into biking, you’ll love the fact that the city has many miles of dedicated bike trails including dedicated lanes on the roadways.  In 2009, the League of American Cyclist named the city as one of the Top Bicycle Friendly Communities within the United States.

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9.  Top of the Line Healthcare

Even some Grand Rapidians might be surprised to know that two of the areas top employers are associated with the healthcare industry.  Spectrum Health along with Mercy Health St. Mary comprise a significant portion of job offerings in the West Michigan area.  It’s never a good thing to get sick, but if you need excellent care or specialized services, Grand Rapids MI rivals the nation’s best when it comes to wellness and disease treatment.   In addition, the Van Andel Institute is recognized as a world leader in biomedical research and science education.  The campus of the MSU College of Medicine (Secchia Center) is located along the Medical Mile.

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10.  Great Place to Find a Job & School

Due to a diverse economic base, Grand Rapids MI has thrived economically despite the recession which has plagued much of the country and the State.  The area is home to more than 90 International companies and four of the largest private companies featured on the Forbes List.  Blessed with a hardworking and diverse workforce, Grand Rapids has attracted investment from a variety of industry sectors.  Average earning are just under $50,000 according to data from the Right Place and the average work force age ranges from the 20’s to 50’s. Data sourced from The Right Place.

The Grand Rapids area features a number of choices for residents when it comes to elementary, highschool, college and post graduate study.  These include public and private schools as well as charter schools.

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11.  Gorgeous Weather – (well, most of the time)

Yes, winter can be brutal in Michigan, but you have to live here to understand why folks are willing to put up with a little excess from Mother Nature during that season.  Summer in West Michigan is wonderful.  Enhanced by the fact that you’re never more than six miles away from a body of water and approximately 30 minutes from Lake Michigan, Grand Rapidians revel in summer.  We also enjoy fall, when the trees break into glorious splendour and put on a show that’s absolutely exquisite.  We like the change of the seasons – watching the pristine beauty of winter give way to the promise of spring.  One thing about Grand Rapids MI weather that’s for certain is that it’s never boring.

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Inventory Shortage ~ Availability, Pricing and Access to the 2014 West MI Housing Market!

The big news for the summer of 2014 according to statistics compiled and released by the Grand Rapids Association of REALTORS is Housing Inventory…or rather the lack of it as the community prepares to enter what is traditionally the most active segment of the selling season.  According to the report, (which tracks data into May 2014) the amount of housing inventory available for sale in West Michigan has dropped to under 3 months of supply.  (2.4 months to be exact based on Pending Sales)  To give you perspective, a balanced market would have the housing supply at 6-7 months during this time of the year as many homeowners normally take advantage of the warmer weather and school closings to market their homes.

Trends Graphic for Housing Inventory in West MI 2013-2014

Trends Graphic for Housing Inventory in West MI 2013-2014

The issue of low inventory has dogged the market throughout most of 2014.  New listings arriving on the West Michigan market have been about 12% lower than the pace of last year.  (2014 – 6,592  new listings YTD vs 2013 – 7541 new listings).  But in spite of the Inventory shortage, the Sales Volume for 2014 is on an upward trend!  In fact, 2014  Sales Volumes for the real estate Board shows an increase of 4.1%  for 2014 over last year and in May alone of this year, a 14.6 percent increase based on actual Closed Sales.

So what does this mean for the West Michigan Home Seller?  Well, Average home prices have increased over 9% during the past month.  Last year, the Average Home sold for $157,814 during the month of May.  Today, the average price is $174,001.  When ALL Sales including vacant land and multi-family units are added into the mix, the numbers drop a little, but irregardless, the average price of $167,728 is the highest price we’ve witnessed for almost a decade.

If you’re in the market for a home purchase, be prepared to aggressively pursue your goal.  This is not a market for the faint-hearted when it comes to the prospect of bidding wars and making quick decisions.  But, a quick decision does not mean you should make a rash decision when in comes to purchasing a home.  Afterall, this is the biggest investment that most Americans will make.  To be effective in a successful negotiation in this market, be prepared to do your research and know what’s for sale in the areas which interest you.  As REALTORS, our company sets up client portals which provide instant notification when new listings which match the criteria for a home which might be a match shows up on the Multiple Listing Service.  In addition, have all financing in order as a well qualified buyer wins hands down in this type of market.

If you’ve been considering placing your home on the market, your timing is impeccable!  However, be forewarned that this market requires attention to detail in which market savvy buyers are not simply looking for a home, but for a well priced and well presented home.  They’ll fight for that!  On the flip side, homes which do not show well, continue to be penalized and sell for less even in a market as active as this one.  If you’d like to know what you need to do to make sure your home attracts the best type of attention and price, give us a call for a free consultation at 616-791-0511.

*Trends Graphics provided courtesy of the Grand Rapids Association of REALTORS

7 Tips for Prepping for a Home Sale during Frigid Winter Weather!

winter-by-audreyjm529Dreadfully cold weather tends to keep most of us in West Michigan inside as much as possible.  Looking outside my window today, this is definitely the case.   With the exception of the snow plow guys, there are few cars on the street.  Even regular dog walkers seem to be sitting in on this one.  If you’ve been thinking about putting your home on the spring market, the prospect of you or someone looking at your home getting stuck in a snow drift in your driveway is a little depressing.  However, there are a number of things that can be done indoors on days like today to keep you on track with regards to being in your new home as soon as possible.

Clear Out Closet Space!

Winter is a great time to reassess the contents of your closet.  If you haven’t worn something once during the year, perhaps it’s time to give it away, donate it or throw it out.  Consider it a small step in the ‘letting go’ process…letting go of smaller items as you prepare to let go of your home so you can make room for new things and new beginnings.

Touch-up Paint

After the holiday decorations are taken down, a home often looks starkly plain.  This is a great time to examine the state of your walls and woodwork.  Is there grime or dirt that needs to be washed or painted?  If you’re stuck indoors, consider picking up a sponge or paintbrush amd doing some touch-up painting.  This is one of the cheapest ways to enhance the appearance of your home.

Organize Garage

Yes, the garage will be cold, but at least it is protected from the elements.  If possible, it is better to clear out your garage when putting a home on the market.  The next best option is to organize it. Neatly staked/arranged boxes or shelves will make even a cluttered garage look as though there is some space for someone else to put their stuff.

Involve Your Kids

On a days like today, most schools have been cancelled.  So kids are home.  And they can be useful, particularly if they have an incentive to help or if an activity is fun.  You know your kids better than anyone else, so think about how to motivate them to help you with getting your home ready for sale.

Collect Documentation for Mortgage Application

If you will require a mortgage to purchase your next home, this is a good time to begin to gather the necessary documentation for your lender.  They are likely to ask for financial records such as a month’s worth of pay stubs, bank statements, last year’s tax returns etc.  Taking the time to put these items in one spot now will save you time in the future.

Update Multiple Listing (MLS) Search Profile

Housing inventory remains tight in the West Michigan area and across much of the country.  Hopefully,  you have created a customized online search profile and are receiving real time updates of available home listings.   If you haven’t done so, that is definitely step 1!  Assuming you have a search profile in place, take the time to review it.  Are there some areas or types of homes which might work which are not included in your current specifications?  The number 1 reason that many people fail to have the best results when searching online is that they make their computer specifications for a home too narrow.  Sometimes, just a little tweak will yield a new set of results for you.

Always feel free to contact us for assistance with your real estate needs.  We’re here to help!

Closing on Your New Home…What to Expect in West Michigan

The anticipation of actually getting the keys as an owner of a new home is an exhilerating experience.  Finally, the months of looking for homes, finding a REALTOR,  attending Open Houses, locating the right property, inspecting the home, negotiating  the transaction, and qualifying for the mortgage have culminated in your arrival at a Closing Table.

It may surprise you to know that a successful Closing,  in which final documents are signed to transfer and secure your ownership rights for your new home,  begins long before you arrive at the Closing appointment in the escrow office.  In fact, I believe successful Closings start at the initial client appointment.

When clients who are purchasing homes or thinking about selling homes contact me for an appointment, the first order of duty is an appointment to discuss the entire real estate process from start to finish.  This discussion entails more than just the details of what the client desires to purchase.  It includes exploring differing needs and expectations about their dreams and goals as well as a discussion about service expectations.

This investment of time at the beginning of the process has proved invaluable in helping clients understand what they can do to assist in completing the transaction.  It also gives insight into some of the hurdles which are sometimes a part of the real estate transaction…especially valuable to clients who anticipate buying or selling a distressed property.

The Closing process commences after the home has been inspected, appraised and cleared through the Underwriting Department of the Lender.  In some ways, it is similar to running a relay with the baton passing to different departments as the home loan goes through the process.  The final runner is the Closing Department which is drafted with the responsibility of getting your loan acceptance documents successfully across the finish line.

An accounting of the proceeds for the home purchase (HUD 1 Statement)  is one of the most important documents that you will review during as you head into the Closing Escrow Office.  Ideally, you should receive this document a few days prior to the Closing to review it.  You may also want to have your legal counsel check the numbers.  A good REALTOR will also review the documents to ensure that the terms of the purchase agreements have been followed and monies credited or debited appropriately.   You may find this article about how to read a HUD-1 Statement helpful.  Our clients are always accompanied to the Escrow table by an Agent and/or Broker of Audu Real Estate.

You will likely be contacted by your Lender or the Escrow Officer to ensure that you know the amount required for your Certified Check or Money Order and have Proof of Insurance for your new home.  It will also be necessary to verify your identity, so make sure you bring a copy of your Driver’s License or other official form of identification such as a Passport or State ID.

Depending on which side of the transaction you are on (Seller or Buyer) the documents you will be required to sign during the Closing appointment can be lengthy or relatively short.  Some loans also require more documentation during the Closing process than others.  Plan on arriving at the Closing a little early.  This will help in relaxing any frayed or anxious feelings.  Many Closing Offices offer beverage service and/or snacks to clients waiting to commence their Closings.

In the Grand Rapids, MI area, it is not uncommon for Closings to occur between both parties to the transaction in the same room or at least in the same location.  If you are doing a Split Closing with two different Closing companies, it is unlikely you will meet the other party during the signing of your Escrow docuemnts.  However, if the Closing is in the same location, it is often customary for both parties to meet, greet and sometimes exchange keys( if this is called for in the Purchase Agreement) after the documents for the Closing have been signed.

At Audu Real Estate, it is our goal to facilitate stress free Closings for our clients and all parties involved in the real estate transaction.  This requires attention to details, good communication and meticulous follow-up and follow-through.  If you are thinking of buying or selling a home in the West Michigan area, please consider giving us a call.  616-791-0511.

Positive Home Equity For Many Homeowners…Is It Time to Sell Your West Michigan Home?

Realtors® servicing many segments of the greater Grand Rapids metropolis are reporting an interesting trend…not enough  housing inventory for the buyers they are taking out to purchase homes.  In fact, many listing agents are finding that they are entertaining MULTIPLE offers on some homes.  Earlier this year, one of our listings in Grand Rapids sold within two weeks and had several offers.

A recent report by Corelogic,  one of the nations leading real estate trends and research organizations reveals that at the end of the last quarter of 2011, over 77% of the homes in the United States were in a positive equity position.  The report also indicated that  11.1 Million homes (or 22.8 percent of mortgages) in the United States were in negative equity and an additional 2.5 Million borrowers had less than 5% equity in their homes (which is defined as near negative equity) thus bringing the total of mortgages with a deficit equity or near deficit equity position to approximately 27.8 %…a slight increase from the 27.1% in the previous quarter.

This means that the majority of homeowners in the United States have a positive equity in their homes.  For home sellers who have been pummeled with a continuous barrage of negative news, there is some hope on the horizon.  In West Michigan, we have had almost 12 months of improvement in the average housing price.  Inventory levels are currently below 5.2 months supply which is indicative of the beginnings of a Seller Market.  (Balanced market is defined as 6 months of inventory)  The chart above highlights the trend until the end of 2011.

Folks, the spring real estate market is here!  If you’ve been wanting to sell your Grand Rapids, Mi home, but didn’t think you could, it’s time to get a second opinion.  If you’re a part of the 30% of homeowners in the United States who don’t have ANY mortgage on their home, that fact alone may equate to some value when buyers are faced with the prospect of long drawn out negotiations with banks through the short sale deficiency process.

To determine if you may be time to Sell Your Grand Rapids, Mi home, consider the following:

1.  Do you own your home Free & Clear of any mortgage debt?

2.  Have you lived in your home for more than 10 years?

3.  Is your home free from any 2nd or 3rd party liens?

4.  Would you like to move into another home?

If you answered YES to one or more of these questions and you have been thinking about selling your West Michigan home but didn’t think you could afford to do so, please contact us for a confidential assessment of your home value in the current market.  In fact, we may even have buyers who are already working with Audu Real Estate for which YOUR home would be the perfect fit.  Don’t delay…Call us at 616-791-0511 today.

3 Simple Ways to Release Emotional Ties During the Home Selling Process

Releasing Emotional Ties During the Home Selling Process

From time to time, I assist clients during a real estate transaction who are having a really difficult time leaving a home.  Sometimes, it is a home which holds a lot of precious memories.  At other times, circumstances have changed; perhaps a job transfer or loss which necessitate a move.  It is a really difficult thing to wrestle with the fact that deep down inside…you’re not really ready to leave…just yet.

Over the years, I’ve realised that there are myriads of reasons why people struggle to let go of a dwelling…even when they know they must.  One huge factor is fear for the future and the unknown.

Here are a few simple suggestions  that many of my clients have found very helpful in helping facilitate a successful transition.

Practical Solitude

Set aside some time to alone & quiet within your home…quiet your heart, be still.  Turn off the TV, listen, hear and re-live special moments.  Look, really look at your home the way you would look into the face of a dear friend.  Relish the moments that have been shared, the laughter, the tears, the good times, the bad…Listen to hear things that may still need to be resolved.  In the stillness you will hear this as well.  Take note

Thanksgiving

Express gratitude outloud.  Yes, these walls have heard a lot of things during your time within them. Why not your thanksgiving?

Thank out loud for the goodness & provision and shelter that your home has provided you.

Thank out loud for the many friends and family members who have found solace, refuge and friendship within it’s walls.

Thank out loud for the difficult lessons learned and the trials you survived.

Thank out loud that you and this home exist…many homes and people no longer do.

Thank out loud that your home will soon be transferred to new owners who will be the beneficiaries of the shelter your home has faithfully provided.

Release the Blessing of Peace

A final step is to release the blessing of peace.  I suggest that home owners go through each room while  releasing God’s peace into the space in preparation for the new owners.  This can be a wonderful time to envision the blessings that you desire for the welfare of those who will purchase the home.

Different blessings can be released for different areas.  For instance in the kitchen, you can release wholesome goodness in the food that is prepared & bless this center of life to be a place in which the family or individual experiences the joy of friendship and satisfaction. Remember we all reap what we sow.  What you are doing for others will eventually be returned in some fashion back to you.

Many have found these few simple steps to be very helpful as they prepare to move.  Even if it is not a difficult emotional transition, this process can be extraordinarily enriching.

A Few Simple Tips to Improve Your Odds in Selling Your West Michigan Home!

Probably the biggest source of angst that home owners in Grand Rapids, Michigan have about selling their home is knowing IF their home has a chance for a Sale.  Quiet turmoil mounts with the following irksome thoughts. 

 Potential Sellers silently question, “Will this Home Sell?”  or “Will anyone even want to look at my home?” 

I’ve been hearing many reports of homes now sporting 12 month listing contracts instead of the traditional 6. The fact is that many homes in West Michigan are not having ANY showings at all!

To improve your odds of selling, it is important to understand that having a good Pricing Strategy is crucial to your success.  Last month, approximately 680 homes Closed successfully in Grand Rapids.  This was 25% below the number of successful property closing during the same 30 day period in 2009. However, there is good news; the good news is that there were homes that Sold and to be successful, it’s important to focus on what successful home sellers did correctly.

Researching you area…

The days of simply guessing about the price at which to list your home, or asking your neighbor what they Sold their home for are over.  The former is a dangerous strategy and the latter often provides inaccurate data.  It’s best to get the facts.

This can be done by requesting a Market Analysis from a good local Realtor® or obtaining an appraisal. One of the most valuable tools available through our Grand Rapids Association of Realtors® MLS system is the ability to obtain a quick analysis of your immediate area by utilizing a proprietary mapping function which details accurate records of homes Sold within a variety of radius options and also gives us access to trends data.

Utilizing mapping and trends data can provide insights which can be easily missed when using the broad ranges which generally divide areas on on popular sites like Zillow or Trulia for property search purposes.  In addition to mapping tools and trends data, pricing strategy is enhanced by understanding how property has traditionally appreciated or depreciated in a local area.  This is where the experience of a good real estate agent can be invaluable.

In today’s market where less than 10% of homes listed for Sale are Closing in any given month, it’s important to improve your odds by understanding the issues and specific dynamics in your neighborhood. If you’d like to know more about creating a pricing strategy for today’s challenging marketplace and you live in the Grand Rapids, MI area, please contact us. 616-791-0511 or info@auduhomes.com

Are There Over 7 Million Foreclosures Coming?

This article was posted by Steve Harney.   It is excerpted with permission.  The issue of Shadow Inventory is already impacting the real estate industry throughout the country and is definitely a factor in the Greater Grand Rapids Mi area.    The percentage of homes Sold in distress sales  through during the month of June 2010 for the Grand Rapids was slightly below 50% of the total volume of transactions.  The total number of homes Sold in June (907) was already significantly lower than the two years prior.

It is critical that homeowners who intend to Sell their homes be aware of this issue when it comes to pricing a property for Sale.  As the article notes, there are a number of factors impacting the Shadow Inventory and as this is a fairly fast moving situation,  it is likely that there will be some significant variations and shifts in the days ahead.  If you’re interested in a more detailed analysis or a market trends analysis about the homes in your neighborhood, please contact Audu Real Estate.

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Are There Over 7 Million Foreclosures Coming?

Article by Steve Harney ~ July 13, 2010

There have been some extraordinary numbers being bantered about when talking about the number of foreclosures that will be coming to market over the next 18 months. Different studies have estimated that number to be between 5-8 million. Let’s take a look at one of these studies today and see how these totals are being calculated.

The Financial Analysis Journal last month posted an article titled Dimensioning the Housing Crisis in which they break down how they arrived at the number of 7.13 million foreclosures about to come to market.

When looking at foreclosures, it is important to realize we are not talking about only those homes currently owned by banks (REOs) but instead the probable number that will be owned. To decipher that number, we must look at two things:

  1. The percentage of foreclosures and the percentage of homes in delinquency
  2. The probability of liquidation (cure rate)

THE PERCENTAGES

The article breaks down the percentage of foreclosures and the percentage of homes in each delinquency category:

At the end of the third quarter of 2009 (last data available), a staggering 14.1 percent of mortgages in the MBA survey were in some stage of delinquency: 4.47 percent of units were in foreclosure, another 4.41 percent were 90+ days delinquent, 1.67 percent were 60 days delinquent, and 3.57 percent were 30 days delinquent.

These percentages put the actual number of homes in danger at 7.89 million.

THE CURE RATE

Cure rates measure the percentage of loans exiting delinquency and returning to their current payment status each month. These percentages have plummeted over the last several years as the housing market has suffered.

The cure rate is most negatively impacted by unemployment and negative equity. Neither of these are expected to improve in the near future.

THE FINAL TALLY

Below is a table using both the percentages and the cure rates to determine the number of potential foreclosures coming to the market.

The first column shows the percentage of homes in each category of delinquency. The middle column are the current cure rates for each category. The last column is the total percentage of each category that will wind up as a distressed property.

The study estimates 7.13 million distressed properties will come to market.

What does this mean to you?

Whenever there is an increase in supply of an item, there is downward pressure on pricing. The houses coming to the market will be sold by the banks at discounted prices. Home values will be impacted dramatically.

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