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Al Baron's Blog

Marketing Specialist with over 26 years experience

By - Al Baron - | Agent in Morristown, NJ
  • House Flips Up 16% as Prices Rebound

    Posted Under: Home Buying in Morristown, Home Selling in Morristown, Investment Properties in Morristown  |  January 30, 2014 11:07 AM  |  267 views  |  No comments
    DAILY REAL ESTATE NEWS | THURSDAY, JANUARY 30, 2014

    Investors are flipping houses again, a trend that had become popular during the housing boom but fell off after home prices started dropping. Now, with home prices back on the rise again, many markets are seeing flips on the upswing.

    Homes that were purchased and then resold within six months accounted for 4.6 percent of all U.S. single-family home sales during 2013, according to RealtyTrac's fourth-quarter 2013 Home Flipping Report. House flipping was up 16 percent from 2012 and up 114 percent from 2011, the report shows.

    Rising home prices have helped investors see profits again. The average gross profit on flips was $62,761 in the fourth quarter of 2013, up from $52,746 a year earlier.

    “Strong home price appreciation in many markets boosted profits for flippers in 2013, despite a shrinking inventory of lower-priced foreclosure homes to purchase,” says Daren Blomquist, vice president at RealtyTrac.

    In 2013, 21 percent of all homes flipped were purchased out of foreclosure, down from 27 percent in 2012 and 32 percent in 2011, the report shows. But investors are still finding homes to buy at an average discount of 13 percent below market value, the same average discount as 2012, “indicating that investors are finding discounted buying opportunities outside of the public foreclosure process — particularly in those markets with the biggest increases in flipping for the year,” Blomquist says.

    The largest increases in flipping nationwide occurred on homes with a price of $400,000 or more.

    What’s more, the average time to complete a flip is shrinking: 84 days in 2013, down from 86 days in 2012 and 100 days in 2011, according to RealtyTrac’s report.

    Metro Areas With Largest Increase in Home Flipping in 2013

    1. Virginia Beach: +141%
    2. Jacksonville, Fla.: +92%
    3. Baltimore, Md.: +88%
    4. Atlanta: +79%
    5. Richmond, Va.: +57%
    6. Washington, D.C.: +52%
    7. Detroit: +51%

    Meanwhile, the major metros that saw the biggest decreases in home flipping in 2013 were Philadelphia; Phoenix; Tampa, Fla.; Houston; and Denver, the report showed.

    Source: RealtyTrac

  • Latest Housing Start Data

    Posted Under: Market Conditions in Morristown, Home Buying in Morristown  |  January 23, 2014 9:52 AM  |  235 views  |  No comments

    In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses the latest housing starts data.

    • New home construction reached the 3rd highest level in the past 66 months. However, the latest annualized pace of 999,000 new units is insufficient to satisfy demand. Another 50 percent increase in housing starts is needed to help relieve the inventory shortage conditions.
    • The latest figure is a decline from the prior month, which was the best in over 5 years. But activity is still higher from a year ago. Both single-family and multifamily housing starts softened in December. Perhaps the deep freeze in a good portion of the country could have impacted builders, postponing the digging of the earth. Housing permits, which are just paper approval and which should not have been impacted by the weather, also weakened a bit.
    • It takes about 6 months to go from housing starts to housing completion and ready for sale for a single-family home. Big builders can do it quicker on spec homes. Owner-initiated construction takes more than twice as long to complete.
    • The inventory of newly constructed homes is essentially at a 50-year low. Much more construction is needed. Publicly-listed companies like KB Homes and Toll Brothers can tap Wall Street funds to get busy. However, small local builders have historically been the principal supplier of new homes in America. These local homebuilders rely on construction loans, which are very hard to get. Many local lenders have indicated the burdensome regulation arising from Dodd-Frank financial market regulations have hindered their ability to lend. Hence, large companies are getting bigger at the expense of smaller guys getting shut out. A case of unintended consequence of a government policy?
    • The insufficient new housing starts will mean a likely continuation of a housing shortage in 2014. Therefore, home prices and rents will rise in nearly all local markets in 2014. 
  • More Sellers Having to Reduce List Prices

    Posted Under: Home Selling in Madison  |  November 7, 2013 11:16 AM  |  216 views  |  No comments

    ne in four home sellers are reporting they’ve had to lower their list price, according to a new report released by the real estate brokerage Redfin. That represents the highest level since 2011, according to the Redfin survey. It also represents a far greater number than in February, when just one in seven sellers reduced list prices. 

    More home buyers are showing a willingness to wait until the price is right, according to Redfin. 

    Price drops for homes were most prevalent in Atlanta, in which 42 percent of home sellers reported lowering their prices in September. Sacramento, Phoenix, San Diego, and Seattle also saw price reductions of more than 30 percent on homes for sale, according to Redfin. 

    On the other hand, the area that saw the fewest price drops was Long Island, N.Y. Raleigh, N.C., San Antonio, Houston, and Philadelphia also saw some of the fewest price drops.

  • Housing Market Optimism Tempered by Shutdown

    Posted Under: Home Buying in Madison, Home Selling in Madison  |  October 9, 2013 10:55 AM  |  275 views  |  No comments

    Fannie Mae said today that consumer responses to its monthly National Housing Survey may have been tempered in September by growing concern about Congress's fiscal policy debate.  While consumers continue to be generally upbeat toward the housing market, their attitudes appear to have plateaued or even decreased over the last three months.

    "Our September National Housing Survey results show that the improvements in consumer housing attitudes witnessed in recent months softened ahead of the government shutdown," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Americans' awareness of policy uncertainty leading up to the October 1st shutdown and the pending debt ceiling debate appears to have grown as indicated by an apparentcautionary holding pattern in overall consumer housing and personal finance sentiment."

    How and when the policy issues are handled could impact consumer attitudes over the next few months, Duncan said.  The gap between people who think the economy is on the right track rose from 37 percent to 39 percent from August to September with the wrong track opinion declining by those same two points to 55 percent.  This narrowing gap, Duncan said, "Could widen, depending on the outcome of the debt ceiling negotiations as the Treasury expects that the extraordinary measures to extend the nation's borrowing authority will be exhausted by October 17. For example, during the contentious 2011 debt ceiling debate and the resulting S&P downgrade of the U.S. government debt, our survey showed that the right track-wrong track spread widened to a survey record of 64 percentage points."  


    The percentage of survey respondents who expect home prices to increase further over the next 12 months decreased from 55 percent in August to 52 percent in the current survey and the average expectation for an increase was down from 3.4 percent to 3.1 percent.  However, mortgage rates are anticipated to increase by a survey high 63 percent of respondents, up from 60 percent the previous month.

  • Subject: Interested in looking at homes.

    Posted Under: Home Buying in Gillette  |  September 18, 2013 10:44 AM  |  300 views  |  No comments
    This is a real email I received this year. Check out my reviews.

        You probably don't remember me, but you gave my boyfriend and I change for a meter in and a few months ago, and asked that we take your card. 
        
        I think I am ready to start looking at houses. I currently live in Sussex County, I work in Chester as a teacher. I am mostly interested in the Morristown, Morris Township, and Morris Plains area. My max price would be $300,000.

        I live at home, so there is no rush, but I am financially ready to start looking, and I know it is a good time to buy, so I figured this was a good time to start. I don't want anything that needs too much work. I kind of want to be able to move right in with minimal work done beforehand.

        I was wondering if by chance you might be available this weekend, on Sunday, to start looking at a few. If not, I was hoping we could set another day.

    Thanks for your time. I look forward to hearing from you.
    Christa

    Christa looked at 17 homes and finally found a beautiful starter home in Denville.
    I loved meeting her mother, sister, boy friend and her boyfriends mother in the process. Real Estate is a people business and I love what I do. 
  • Subject: Interested in looking at homes.

    Posted Under: Home Buying in Madison  |  September 18, 2013 10:42 AM  |  321 views  |  No comments
    This is a real email I received this year. Check out my reviews.

        You probably don't remember me, but you gave my boyfriend and I change for a meter in and a few months ago, and asked that we take your card. 
        
        I think I am ready to start looking at houses. I currently live in Sussex County, I work in Chester as a teacher. I am mostly interested in the Morristown, Morris Township, and Morris Plains area. My max price would be $300,000.

        I live at home, so there is no rush, but I am financially ready to start looking, and I know it is a good time to buy, so I figured this was a good time to start. I don't want anything that needs too much work. I kind of want to be able to move right in with minimal work done beforehand.

        I was wondering if by chance you might be available this weekend, on Sunday, to start looking at a few. If not, I was hoping we could set another day.

    Thanks for your time. I look forward to hearing from you.
    Christa

    Christa looked at 17 homes and finally found a beautiful starter home in Denville.
    I loved meeting her mother, sister, boy friend and her boyfriends mother in the process. Real Estate is a people business and I love what I do. 
  • Subject: Interested in looking at homes.

    Posted Under: Home Buying in Morristown  |  September 18, 2013 10:41 AM  |  310 views  |  No comments
    This is a real email I received this year. Check out my reviews.

        You probably don't remember me, but you gave my boyfriend and I change for a meter in and a few months ago, and asked that we take your card. 
        
        I think I am ready to start looking at houses. I currently live in Sussex County, I work in Chester as a teacher. I am mostly interested in the Morristown, Morris Township, and Morris Plains area. My max price would be $300,000.

        I live at home, so there is no rush, but I am financially ready to start looking, and I know it is a good time to buy, so I figured this was a good time to start. I don't want anything that needs too much work. I kind of want to be able to move right in with minimal work done beforehand.

        I was wondering if by chance you might be available this weekend, on Sunday, to start looking at a few. If not, I was hoping we could set another day.

    Thanks for your time. I look forward to hearing from you.
    Christa

    Christa looked at 17 homes and finally found a beautiful starter home in Denville.
    I loved meeting her mother, sister, boy friend and her boyfriends mother in the process. Real Estate is a people business and I love what I do. 
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