Lee Morof's Real Estate Blog

They say that language reflects culture, and certainly, the difficulties in the real estate market are showing up in the list of new words for this year. If you’re buying or selling Southeast Michigan real estate in Oakland County, Michigan, you may already have taken note of some of these new words. Here are three for your consideration:

Water: Not Just For Swimming Anymore
According to the keepers of the language flame at Merriam Webster, “underwater” has a new definition. “Underwater” now officially also means “having, relating to, or being a mortgage loan for which more is owed than the property securing the loan is worth.”

Many people in underwater mortgages are choosing to delay selling until their home value comes back up. The good news is that values are indeed rising again, so waiting out the storm can be a good idea.

Risk: To Be Feared and Avoided
Perhaps not coincidentally, another new word at Merriam Webster is “systemic risk.” This means “the risk that the failure of one financial institution (as a bank) could cause other interconnected institutions to fail and harm the economy as a whole.”

Man Cave: Give Me Shelter
Many men probably took shelter in the now-officially-named “man cave.” This means “a room or space (as in a basement) designed according to the taste of the man of the house to be used as his personal area for hobbies and leisure activities.”

The good news is that the Southeast Michigan real estate market is improving. Homeowners who were holding their breath while underwater are now coming up to the surface and enjoying the fresh air.

If you’re looking for more information on buying or selling Southeast Michigan real estate, I can help. Give me a call today at 248-514-2640 or email me at info@NorthWoodwardHomes.com.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney Lee Morof 
RE/MAX Showcase Homes, Birmingham, Michigan
www.NorthWoodwardHomes.com

Recently released figures indicate real estate nationwide and Southeast Michigan real estate in Oakland County are continuing to steadily improve. Here are seven signs that demonstrate the upturn:

1. Housing affordability has risen dramatically. This is due to a combination of reduced real estate prices and record-low mortgage rates.
2. Housing starts are increasing, driven mostly by multifamily starts.
3. Existing home sales increased in January, which is now three months of gains out of the past four months.
4. At the end of January, total housing inventory fell to a 6.1 month supply. According to Lawrence Yun, NAR chief economist, “The broad inventory condition can be described as moving into a rough balance, not favoring buyers or sellers.”
5. There are plenty of home buyers and investors competing for foreclosure sales in almost all markets.
6. Purchases of homes by all types of buyers from seasoned investors to first-time home buyers are on the rise.

Most economists agree that the market is improving. Frank Nothaft, Freddie Mac vice president and chief economist says, “Our outlook anticipates gradual, but steady, improvement in the economy and the housing market, supported by low interest rates and brightening job market prospects.”

This is excellent news for the spring and summer Southeast Michigan real estate buying season that’s just around the corner. If you’ve been considering buying or selling a home, now’s the time to start that process so you’re ready for the hottest season we’ve seen in years.

Thinking about buying or selling Southeast Michigan real estate? Please contact me today at 248-514-2640 or email info@NorthWoodwardHomes.com. I can help you achieve your goals.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney 
RE/MAX Showcase Homes, Birmingham, Michigan
Call:  248-514-2640
www.NorthWoodwardHomes.com

The latest statistics indicate that the U.S. real estate market is at or very close to the bottom right now.

On January 18, Bloomberg News reported, “Confidence Among U.S. Homebuilders Climbs to Highest Since 2007.” Bloomberg said, “The confidence measure, which increased for a fourth straight month, improved in all four regions of the U.S. This is ‘yet another indication of the gradual but steady improvement that is beginning to take hold in an increasing number of housing markets nationwide,’ Bob Nielsen, chairman of the National Association of Home Builders and a builder from Reno, Nevada, said in a statement.”

The official data on home prices might not show the recovery yet, because they are always months behind, but most other data indicates that in general the housing market has hit the bottom.

Right now, homes in America are the best value they’ve been in many generations. And right now, mortgage rates are off-the-charts low. In short, now is the time to buy Southeast Michigan real estate.

The reasons to buy now are incredibly basic:

• U.S. home prices are more affordable than ever – by far.
• Mortgage rates are down to record-low levels.
• You can often pay below-market prices on short sales and REOs.

Of course, there is no guarantee that this is the bottom. But with prices this low and with very few other great places to invest your money, now’s the time to seriously consider buying Southeast Michigan real estate. If you can buy now and hold on to it for a few years, it could be one of the lowest-risk, highest-reward investments you ever make.

If you’re still not convinced real estate is one of the best values out there right now, please give me a call at 248-514-2640 or email me at info@NorthWoodwardHomes.com. I will share specific numbers with you about our Southeast Michigan real estate market in Oakland County.

Lee Morof
Associate Broker/Certified Distressed Property Expert/Attorney
RE/MAX Showcase Homes, Birmingham, Michigan
Call:  248-514-2640
info@NorthWoodwardHomes.com
www.NorthWoodwardHomes.com

Frequently, there are news stories that impact our Southeast Michigan real estate market.  Here are two I want to share with you this month:

Rising Interest Rates Could Get Buyers Moving

Rising interest rates may finally push Southeast Michigan real estate buyers off the fence and into the market.

In December, after President Obama agreed to extend tax cuts for two years, the financial markets  indicated this event would most likely push mortgage interest rates higher.

Analysts predict that buyers will move quickly when it looks like rates are going up and are unlikely to come down. “Once people see this might actually be the bottom, they’ll go for it,” says Paul Dales, U.S. economist at Capital Economics Ltd. 

For an example of interest rate increases, note what happened in December, 2010.  

• On December 2, the 30-year fixed interest rate hovered around 4.46 percent. 
• One week later, on December 9, it was up to 4.61 percent.
• When I checked on December 26, the 30-year fixed interest rate was up again to 4.875 percent.

National Foreclosure Rates Fall

Has the real estate market hit bottom?  One sign that it has is RealtyTrac’s report that foreclosures fell sharply in November.  RealtyTrac’s November, 2010, U.S. Foreclosure Market Report™ indicated a 21 percent decrease in foreclosure activity from the previous month and a 14 percent decrease from November, 2009.

According to RealtyTrac, a mortgage research firm, foreclosure activity decreased dramatically in November with fewer than 300,000 properties receiving a foreclosure notice for the first time since February, 2009.

While foreclosures typically decrease in November, and we’re sure to see a rebound in foreclosure activity, these statistics are not to be dismissed because they show the lowest level of foreclosure activity since November, 2008.  Additionally, both the 21 percent month-over-month decrease and 14 percent year-over-year decrease in foreclosure activity were the highest drops recorded since RealtyTrac began publishing the U.S. Foreclosure Report in January, 2005.

Want to know more about the Southeast Michigan real estate market?  Give me a call at 248-514-2640 or email me at info@NorthWoodwardHomes.com to discuss our real estate market.  I look forward to hearing from you.

Lee Morof
Associate Broker/Attorney
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

From national and Southeast Michigan real estate to the U.S. economy, the predictions for 2011 are in.  Like any predictions, they vary from gloomy to cheery.  Overall, the U.S. forecasts for national and Southeast Michigan real estate are more positive than negative for 2011.

1. Real Estate Economy Watch predicts:  People are interested in buying a foreclosure.  Nearly half (49 percent) of U.S. adults are at least somewhat likely to consider purchasing a foreclosed property, up from 45 percent in May, 2010. Despite the rising interest in buying a foreclosed home, an increasing number of U.S. adults also recognize negative aspects to buying a foreclosure.

2. Bill Redfern, CEO of A Buyer’s Choice Home Inspections says:  Presale inspections are on the rise.  Sellers, and particularly banks, have become far more interested than in the past in having presale inspections conducted to help attract buyers. This business, which helped sustain inspectors during the downturn, is expected to grow in 2011 even as regular inspections come back. I might be optimistic, but I think in five to 10 years every listing coming to market will have a presale inspection done.

3. The National Association of REALTORS®’ (NAR) Chief Economist Lawrence Yun is projecting: 

• Once businesses pick up spending, job gains will quicken and home sales—fueled by strong affordability and plenty of pent-up demand—will rise.
• 5.2 million existing-home sales in 2011, up from 4.8 million last year.
• Modest improvement in prices—a rise of about 1 percent this year on a national basis. That would be the first in what Yun says will be a series of small but steady gains in the years ahead that will eventually bring home sales back to a period of normalcy.
• Yun says all of the price excesses from the housing bubble have been squeezed out of the market and interest rates remain at historically low levels, making buying attractive now. 

4. The Joint Center for Housing Studies says:

• If the past is any guide, the strength and sustainability of the housing recovery will depend most on the bounce back in employment growth.  Unfortunately, most economists predict that the unemployment rate will remain elevated as discouraged workers reenter the labor force amid slow gains in jobs.
• The oldest baby boomers are just turning 64, with millions soon to follow. Despite their losses in wealth caused by the correction in home and stock prices, the baby boomers will drive demand for senior housing suited to active lifestyles as well as for assisted living facilities.

5. According to the Standard and Poor / Case-Schiller index:  Home prices are expected to rise 12 percent in the next five years. And, according to a survey of economists, that upturn should begin in 2011.

6. WalletPop.com’s prediction for renters in 2011:  The American Dream will include both renting and owning:

• Lifelong renters will begin to buy.  As jobs grow, prices hit bottom or move past their bottom in the handful of appreciating markets, and interest rates start what is likely to be a long, volatile climb up from the all-time lows of 2010, extreme affordability will push even some lifelong renters off the fence and into the market.
• Lifelong owners will begin to rent.  Baby Boomers who have owned homes for decades and lost them at the trough of the job and housing markets will become renters-by-choice.  Retirees will rent their current homes, rather than selling them, move to warmer climes and rent instead of own their retirement homes, at least until the housing market stabilizes and the mortgage market relaxes.

Although no one can be certain what will happen in 2011 – especially for the struggling national and Southeast Michigan real estate markets – we can all gain a little hope from these 2011 forecasts.

If you’d like to buy or sell a home in 2011, I can help. Call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
Associate Broker/Attorney
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

Today’s slow Southeast Michigan real estate market is a hard place to sell homes. However, the fact remains that homes are still being bought and sold.  Buyers are out there; you just have to attract them to your home.

Here are a few tips for getting homes sold in a slow Southeast Michigan real estate market:

Prepare for the Sale
Your home needs to stand out from the rest. Give it a lot of sparkle and shine:

• Make minor repairs:  Patch holes, fix faucets and replace cracked tiles.
• Clean inside and out:  No cobwebs, dirty carpets, worn rugs or smelly odors.
• Check your curb appeal:  Mow the lawn, plant flowers, trim bushes, etc.
• Remove clutter and de-personalize:  If it isn’t essential, pack it up or get rid of it.
• Straighten your cabinets and closets:  Buyers will open them; make sure they’re nice and neat.

Stage Your Home
Hire a professional home stager or read informational home staging articles on doing it yourself. Here are a few quick tips:

• Carefully choose your window coverings.
• Tie new bathroom towels with ribbons for a “finished” bathroom look.
• Use color psychology.
• Bring in plants.

Use Good Marketing Techniques
A strong marketing campaign is a must.  A few techniques you want to be sure you or your agent includes in your marketing campaign are:

• Take photographs with good lighting that show off the positive aspects of your home.
• Create a virtual tour that showcases both the inside and outside of your home.
• Display the photos and virtual tour on as many real estate websites as possible.

Selling homes isn’t a quick or easy endeavor. Especially now, aggressive marketers are the winners. Taking the time to clean and stage your home, as well as create a wide-reaching marketing campaign, can get that for sale sign taken down for good.

If you’d like to sell your Southeast Michigan real estate, let me create a strong, wide-reaching marketing campaign to get your home sold.   Give me a call today at 248-514-2640 or email me at info@NorthWoodwardHomes.com.

Lee Morof
Associate Broker/Attorney
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

If you’re like me and other real estate agents, home sellers, homebuyers and homeowners, you’re always looking for a great resource for information on the Southeast Michigan real estate market. You have questions and you want answers.

• What are the mortgages like in this area?
• What are the current selling prices for homes?
• What’s a specific neighborhood like?
• Is there anything besides the economy affecting the Southeast Michigan real estate market?

For instance, you want to know current market trends. Are they stabilizing? Are things still sliding down hill? Is there a buying trend sellers can take advantage of to market their homes? While a professional real estate agent will help you sell or find a home, it doesn’t hurt for you to do some research on your own to become more knowledgeable. Who knows, you may come up with some ideas we haven’t thought of!

So where can you find reliable information on the real estate market? On the Internet, there are thousands, perhaps millions, of informational sites. Below are just a few of my personal favorites:

CNNMoney.com (real estate) – The information on CNNMoney.com has no bias in terms of convincing you to sell or buy. Where are home prices falling? Where are they strongest? What information do you need to know as a buyer or seller? From mortgages to pricing and market stability, you can find it here.

RISMedia.com – If you can’t find it on CNNMoney, you can most likely find it on RISMedia. Home improvement, financing and foreclosure information are just a few of the topics. As well, because RISMedia is actually involved in real estate, you can find the latest market information.

DQNews.com – DataQuick provides real estate data on a state-by-state basis or on a specific area. While the information can be a little technical for the non-real-estate-professional, if you want to know how the Las Vegas region is doing for home sales, or the average mortgage rates in Missouri, DQ can help. Depending on your area, you may have to pay for the data, but it’s fairly inexpensive and can give you great information.

If you’re interested in the Southeast Michigan real estate market in any way, bookmark this blog and the listed sites for easy reference. The more you know, the better you can prepare for upcoming trends, good or bad!

If you’re trying to sell your home, or are looking for your dream home to buy, I can help. Call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

Government support in the national and Southeast Michigan real estate sectors is slowly being pulled back. For instance, the federal homebuyer’s tax credit expires this month and the Fed stopped purchasing mortgage-backed securities in March. These two changes in financial backing for the housing market are causing worry because people fear the expiring tax credit will cause a dramatic drop in sales.

An important question right now is how much did the government support really help the national and Southeast Michigan real estate markets and the economy?

The Economy
Dean Maki, chief U.S. economist for Barclays Capital (New York) and one of the most accurate economic forecasters for the past 20 years, says the U.S. economy is on the rise. Many economists share Maki’s view:  We’re at the bottom and there’s no place left to go but up.

The Fed Stops Buying Mortgage-Backed Securities
The largest hurdle for the real estate market came at the end of March, as the Fed finished buying up $1.25 trillion worth of mortgage-backed securities and taking care of housing-agency debt to the tune of $175 billion. However, strategists and economists conclude that the change won’t have a lot of impact; the central bank will be replaced by private demand.

The Expiration of the Homebuyers Tax Credit
The second largest hurdle, the expiration of the homebuyers’ tax credit, might have a bigger impact if it had brought a huge sales increase. It didn’t, however, and the belief is that things will slowly improve with – or without – the credit. Although vacant housing rose to 2.09 million by the end of 2009 and foreclosures are expected to hit around 2.2 million this year, the number of new households may reach as high as 1.25 million.

The Good News
Of the potential 1.25 million new households, almost 1 million are currently living with family members. With home sales gradually improving, economists predict that even a slight improvement in the job market will bring those 1 million households out of the woodwork to find a home. When this happens, the excess housing supply will quickly disappear. 

If you’ve been stuck, waiting to sell your Southeast Michigan real estate in Oakland County, your home is part of the housing supply. With the housing market slowly improving, you may very well end up coming out on top within the next three to six months.

If you’d like to sell your home, or buy a new home, I can help. Call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

2009 was a rough stretch for many Southeast Michigan real estate sellers and buyers, but new reports hint at possible stabilization in the housing market that may prove beneficial for everyone. As 2009 rolled to a close and 2010 opened into a new year, economic and real estate reports poured out good news, but bad news wasn’t far behind. For each positive note, there is always that unavoidable “but”:

• Mortgage rates are holding steady below 5%, thanks to government intervention. Thanks to the low rates, more people are buying and refinancing. However, the downside is that banks are more reluctant to refinance or loan. This leaves many, who want to buy Southeast Michigan real estate, with the inability to do so. Ironic that, in a buyer’s market, it’s the banks with all the selling power.
• The other “but” is that the Federal Reserve program providing the low mortgage rates is set to expire in March. Rates could very well double shortly after, which is highly likely to drop the number of interested buyers. A drop in buyer numbers will only further shift the supply/demand ratio.
• As of December 10, 2009, the number of foreclosures in a month had dropped 16%, nationwide. The home buyer tax credit expansion, foreclosure prevention programs and loan modification programs have helped, as well as state mandated financing programs. As great as that is, there were still over 300,000 foreclosures in November, 2009, which is 18% higher than November, 2008.
• Home prices are “firming,” showing improvement over five consecutive months. Although the rise is considered mild, fewer homeowners are underwater, where they owe more mortgage than their house is worth. Because housing prices are improving, home sellers are more confident in the listing prices they’ve set.

However, many – who are currently unemployed – have ARM mortgages that will be resetting shortly. While they can afford their current mortgages, many won’t be able to afford a higher one. This could bring another round of foreclosures and another drop in housing prices.

What does all this mean for Southeast Michigan real estate buyers and sellers? As Ben Franklin put it, “nothing in this world is certain, except death and taxes.” However, there is also the famous “nothing ventured, nothing gained.” 2010 could be rocky, but, if you’re careful and do your research, you’ll find smooth sailing ahead.

If you’re trying to buy or sell a home, I can help. Call me at 248-514-2640 or email me at info@NorthWoodwardHomes.com for more information.

Lee Morof
RE/MAX Showcase Homes
Birmingham, Michigan
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640

Good news continues for Southeast Michigan real estate housing numbers in Birmingham, Michigan.  In June 2008, as compared to June 2007,  total homes on the market declined by 26% and the Median Sale Price increased by 52%. Total sales were down by 33% which was probably due to the decrease in inventory.

If you’re thinking about buying or selling Southeast Michigan real estate, give me a call today at 248-514-2640.

Lee Morof
RE/MAX Showcase Homes
www.NorthWoodwardHomes.com
info@NorthWoodwardHomes.com
Call:  248-514-2640