Let us introduce you to Nick and Christine who recently purchased this beautiful 5 bedroom, 3 bathroom, 2771 square foot home for $415,000. What makes this story worth sharing is that Nick and Christine were able to use Nick’s VA benefits since he had served overseas in Kuwait just after the conclusion of Desert Storm. The process for a military veteran to purchase a home using their VA benefits can sometimes be a challenge but the challenge often doesn’t come from the lack of qualifications from the buyer themselves. What often makes these transactions hard is the perception by the seller and or the sellers’ real estate agent that a VA buyer is somehow less qualified than a cash buyer or a buyer using some other form of financing. This is often the farthest from the truth and certainly not the case with our clients Nick and Christine. So let us encourage you to give our veteran’s a chance when they come knocking on your door to purchase a home. Congratulations Nick and Christine on your new home and we wish you all the best!
It would appear from all major market indicators that our Real Estate market has entered into a slight market correction. This is in no way bad news at all. What we need to realize is that real estate values actually peaked in most major markets in California around August 2006. We then witnessed a real estate value decline of approximately 20% by January 2008 and real estate values in most markets continued to decline and reached a low point in February 2011 which was a total loss of approximately 50% from the peak of the market. The government then stepped in and provided a tax credit incentive that helped boost the purchase market and also helped increase values slightly but the heavily loaded distressed inventory (REO – Bank Owned and Short Sales) caused that increase to diminish and the market stalled once again. By February 2012 the decline in home values adjusted to its lowest point bringing the total loss of equity in most major real estate markets to just a little under 55% from its peak in August 2006.
The good news is that the decline in home values is over. What began to happen toward the end of 2012 is that, investors, first time buyers, move up buyers, and those who re-entered the market after losing their homes, started creating a home buying bonanza. With the rules of supply and demand being the guide, home values increased rather quickly by conservative estimates of 25-30%. This means we still have 20-25% of the overall loss to make up before we reach the peak values of mid-2006. We are all keenly aware that the job market is moving slower than we would like and the economy remains fragile but home values remain stable and poised for future growth.
The rules of supply and demand continue to rule the day and with a shortage of new construction, it won’t take the consumer long to figure out that prices are not dropping and the wheels are not falling off the bus as they were in 2008. In addition, normal buying patterns (job transfers, school year influence, and seasonal shifts) are allowing for a normal real estate cycle of buying and selling to occur. Sellers must face the facts that what a willing buyer will pay based on comparable sales prices are (in most cases) what will dictate or determine the value of their home as we move forward. Buyers on the other hand should not sit back and be idle as interest rates are probably not going to go down anytime soon and more potential homeowners are entering the market at a pretty quick pace.
One additional item to remember is that new home construction is on the rise in California and this means more jobs which in turn will drive up the need for more infrastructure and even more housing. All of this is good for the overall economy and good news for current homeowners and future homebuyers. There are always other factors (i.e. increased taxes, regulations and inflation) that can damper any economic and or housing recovery but the housing engine remains strong and even with this market correction it remains healthy and vibrant. From my perspective, this housing market correction is simply allowing for a balance in home values as it relates to the overall economic cycle and we are simply returning to a normal real estate market.
Written by Mike Southwick
Use by permission only
During the summer months you may want to take in one of these local festivals. We have listed several of them throughout the State of California and they feature the heart and soul of the culture that makes each community they represent very distinct and unique. We often forget this when we only think in global or large scale terms. I would encourage you to take the time and visit some of these festivals listed here and check back, follow this page or book mark this web site as we plan to try and post these on a monthly basis. For a printable version click here – September 2013 Festivals
I have spoken to a number of people who find that vacation costs have increased dramatically and many people are choosing to do things closer to home. This particular posting shows some of the upcoming County Fairs for the month of September in various Counties throughout California in case you want to take in one or two of these. The County Fair is one of those timeless events that does not seem to lose its old fashioned charm and we usually take in two or three of these a year. Be sure to follow us or bookmark this page as we will post County Fairs for the remaining months of the summer in future blog posts. For a printable version please click here – California County Fairs September 2013
Now that summer has wound down, you may still find time to take in a few of these events mentioned here – some of which are perfect for the whole family! We have done the research for you and all you have to do is click on this link September 2013 Events and you will be taken to the full schedule that we have created for you. There are a number of plays, events, concerts, races, car shows, along with a host of fairs and festivals throughout the month of September. Take a look at the attached schedule September 2013 Events and click on the links (pictures) for full details and the web site associated with each event. There are enough local events going on throughout Placer County, Sacramento County, El Dorado County, Amador County, Yolo County, and Solano County to fill your whole calendar for the month of September. So get out your calendars and have some fun!
The 2013 Placer County Heritage Trail Museum Tour took place on August 10th (Saturday) and August 11th (Sunday). This is the 6th year that this event has been held and once again there were 19 museums from Roseville to Tahoe that were open free of charge from 10:00 a.m. to 4:00 p.m. each day. All 19 museums provided historical artifacts and displays, along with a number of volunteer docents who took you back in time and described what life was like in our rich Placer County history. Each museum provided its own unique historical setting and some even had food and beverages like root beer floats and homemade hand cranked ice cream. There were 6 Valley Museums to see in South Placer, 6 Museums in Auburn, and 7 Mountain Museums located in Sierra Nevada and the north shore of Lake Tahoe. For more information be sure to visit the Heritage Trail web site and look for announcements about next year’s event. See you on the trail!
I have spoken to a number of people who find that vacation costs have increased dramatically and many people are choosing to do things closer to home. This particular posting shows some of the upcoming County Fairs for the month of August in various Counties throughout California in case you want to take in one or two of these. The County Fair is one of those timeless events that does not seem to lose its old fashioned charm and we usually take in two or three of these a year. Be sure to follow us or bookmark this page as we will post County Fairs for the remaining months of the summer in future blog posts. For a printable version please click here – California County Fairs August 2013