When Do Houses Come On The Market?

Seems like, for years now, people continue to ask “when do more houses come on the market in the New River Valley?” It’s true that, as I write this a few days before Christmas 2016, inventory is down, as it is every year. For instance, if you were looking for a single-family home between $250,000 and $300,000 in Christiansburg right now, you’d have twenty six homes to choose from. In Blacksburg, that number would drop to eleven. This makes sense, of course, as in the last six weeks of the year there are three major holidays, and lots of traveling, but for a buyer who’s ready to buy NOW, it can be frustrating.

With that in mind, our real estate market follows most in the country – a typical bell curve, with more listings coming on the market in the spring, peaking in the summer, and falling off in the fall. It’s a pattern that’s been repeated for years now, and one we can reasonably expect to continue.

So – looking to buy in 2017? Don’t be disheartened by lack of inventory at this moment in time. Consider the chart below, which shows activity levels for the New River Valley real estate market going back to 2003. You can clearly see a sharp peak, year after year, as more and more properties came on the market. And for home sellers, fear not – the same pattern applies to you, as well.

So if 2017 is the year that you’re looking to buy, or sell, know that your options – and competition – may be limited right now, but that will likely change as we head into the New Year. As always, if you have any questions, any of our Nest brokers are happy to discuss further.

Have a Merry Christmas!

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The Fed Raises Rates – So Now What?

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Federal Reserve

As expected, the Federal Reserve raised short-term rates today. This is the first such increase they’ve made in a year, and the second in a decade. So what’s it mean for real estate mortgages?

The Federal Reserve is the bank of the United States – they regulate monetary policy, and they provide stability within the central banking system. And while an increase in short-term rates might seem to be a bad thing, it’s actually an indication that the Fed sees the US economy in positive terms, and is bringing interest rates up to better mirror inflation. While it’s true that mortgage rates will now rise – local lender Robert Mitchell of Movement Mortgage is already reporting that they’ve seen rates rise to 4.25% – the truth is that this is really a sign of an improving economy. With quoted rates effective today of 4.25% on a 30-year fixed loan, let’s run some numbers to see what the difference in today’s advertised mortgage rates look like:

$200,000 loan at yesterday’s closing rate of 4.125% – Principal & Interest payment of $969.30
$200,000 loan at today’s current rate* of 4.25% – Principal & Interest payment of $983.88
* rate pulled from www.Movement.com

For home buyers, today’s news is going to mean a slight increase in the overall cost of a loan. Again, based on the calculations above, that cost is going to be minimal, but each hike in the Fed’s rate will mean a slight increase in the monthly cost of a home loan. And for sellers, it puts a small amount of downward pressure on you, as well – rising rates are going to keep a small number of buyers out of the market initially, but we’re predicting that’ll reset a bit as we head into the spring market. And remember – rates are still incredibly low, historically. The chart below, from HSH.com, shows 30-year conventional rates over the last 16 years.

30-year mortgage rates since 2000

30-year conventional rates since 2000

 

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When’s A Good Time TO Sell A Home?

“Hey Jeremy, when’s a good time to sell my home?”

I get this question all the time – twice today, in fact. A few times this week. There are thousands of other Realtors that are going to tell you “now’s a great time to sell a home!”, but you might have noticed that earlier they said “now’s a great time to buy a home!”, too. So which is it?

The truth is, I really don’t know. Your situation, and your motivation, is going to be different from someone else’s. One person today was looking to sell in order to pay off student loans, so he and his family are looking to downsize for a while so that they can put themselves in a better financial position. The mortgage payment is comfortable, but they want to do more. Another has a house that reminds him of painful times, and he wants the house sold yesterday in order to put the hurt behind him. Think the motivations are different?

Don’t be fooled by those who seem to be saying “NOW” when trying to answer the question of whether it’s a good time to sell. A home will sell in any market – it might sell better in one market than another, but a home will still sell. So weigh your options, review the data, and talk to your Nest agent – we’ll help you work through your options and decide what’s best for you.

 

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Find A Christmas Tree In The New River Valley

Thanksgiving is gone, and Christmas is upon us. While we moaned about seeing Christmas displays in August – TOO SOON – the reality is that Christmas is right around the corner. And before you finish the Christmas shopping, it’s time for the Christmas tree to go up.

If you’re one of those who likes to be Clark Griswold and chop down your own tree (and really, is there any other way?), here’s a list of Christmas tree farms throughout the New River Valley.

  • Idyllwood Farms, Blacksburg – technically not a cut-your-own, but still a recognizable location that’s been serving the New River Valley since 1984. Pre-cut, along with wreaths for sale.
  • Joes Trees, Newport – my personal favorite, Joe’s Trees is a great place to go and spend a couple of hours, wandering the many acres and getting lost among the trees. You can cut your own tree, or choose one of their pre-cut selections. They also have hayrides, and a full retail shop.
  • Rifton Farm Nursery, Pilot – Recently featured in The Roanoke Times, they have 40+ acres of trees, ready to help you cut and load.
  • Roll Out Farm, Pilot – Also located in Pilot, this farm has choose and cut options, pre-cut trees, and a full retail shop.
  • Spruce Ridge Tree Farm, Newport – if you’ve ever been down Spruce Run Road in Newport, you’ve almost certainly noticed the seemingly miles and miles of trees available at Spruce Ridge Tree Farm.
  • Sweet Providence Farm, Floyd – choose and cut at this farm in Floyd, and enjoy some of their delicious treats in their retail store. They also have a satellite location at Tanglewood Mall, in Roanoke.

There are plenty of other places throughout the New River Valley to get your Christmas tree this year – what are some of your favorites? Mention them in the comments and I’ll add them to this list!

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How To Prepare Your Home For Winter

buddyWinter is here in the New River Valley! Well, almost, but it’s never too soon to start prepping your home for winter.

While we’re hunkered down through the winter months, remember that your home is exposed to the elements all that time, keeping you safe and warm. And there are certain things you should do now to ensure that all continues to be safe and comfortable.

Looking for your next home this winter? Start your custom search here.

I wrote about preparing your home for winter several years ago, which you can see here, and then our friends up north in Canada – if ANYONE knows how to handle winter it’s Canadiens – posted this 10 Tips To Winterize Your Home. Everyone loves top ten lists, right? The whole post is linked here.

  1. Clean the gutters
  2. Reseal the windows
  3. Clean out the garage
  4. Install storm windows
  5. Prep the fireplace
  6. Drain the hose pipes
  7. Pack up the patio furniture
  8. Prep the furnace
  9. Automate the thermostat
  10. Block drafts

Winter in the New River Valley is a spectacular time. Take some time now, while temperatures are still mild, to prepare your home for winter, and keep the comfort rolling throughout the year!

 

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Lawrence Yun’s Opinion on a Trump Presidency and Real Estate

As a follow-up to last week’s post about what a Trump presidency will mean for mortgage rates, I wanted to come back to this with a post by Lawrence Yun on Forbes.com. Lawrence is the Chief Economist for the National Association of Realtors, and a man infinitely more qualified than I to pontificate about all of this. But it’s my blog, and I can use the word pontificate here.

Read Lawrence’s opinion here. It’s long, but good. If you want the bullet points:

  1. There will be a short-term stimulus.
  2. The trade deficit will rise.
  3. The stock market will gyrate. (now I just envision a dancing stock market)
  4. Dodd-Frank will be revised, opening up loan options for local development. This could be a huge boon for the New River Valley real estate market, which is slated for significant growth in the next two decades.
  5. Fannie Mae and Freddie Mac could be finished.

There are more, but those were my big takeaways.

Here’s the long and short of it all. No one knows. Part of what creates all of this uncertainty is that President-elect Trump has not provided much of anything in the way of a coherent policy, so much of what we’re seeing now is a best-guess shot in the dark. Expect to continue to see things settle as the Trump team prepares for the transition, and I suspect as we get closer to Inauguration Day, we’ll have a clearer idea of things to come.

Isn’t this fun?

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What Does A Trump Presidency Mean For Mortgage Rates?

dusty-computerTap tap tap. Is this thing on? It’s been a long time since I blogged with any regularity at all, but today seemed an appropriate day to dust things off and get back into the saddle. I was speaking to a group yesterday and was asked about the blog, where I was reminded that it had been far too long since I had done this blogging thing. So … let’s get back to this, shall we? Now’s as good a time as any.

There was a relatively significant event in the United States yesterday, one in which hundreds of millions of people, and every country in the world, was watching. Did you catch it? The 2016 Presidential Election was held, and Donald J. Trump has been named President-elect. Like it or not, we made our bed, so now we’ll lie in it. I was glued to the TV last night, watching every pundit talk about this and that, and wondering what this all means for the New River Valley real estate market going forward.

In elections past we’ve seen some market caution leading up to, and even after, the election. That’s not unusual, and not unexpected. It’s been the case the last elections I’ve seen as a practicing Realtor (2008, 2012, 2016), and it was something we knew was likely. This year, however, we saw almost right away that market futures started to fall, and they kept falling throughout the night – the markets did not like the uncertainty that a Trump presidency might bring. This wasn’t altogether unexpected … in the weeks and months leading up to the election, the markets had typically improved when Hillary Clinton was polling well, and it had typically fallen when Donald Trump was polling well. What was unexpected – to this hack, however – was how quickly it started to fall.

crazy-numbersAnd then the emails and texts started to come, from clients and casual observers. “What’s this mean for mortgage rates?” “Should I lock my refinance?” Since I’m a wealth of knowledge on this subject, I crunched the numbers and then asked a few mortgage lenders who really know what’s going on.

The general consensus among the lenders I talked to is that the market is going to be pretty volatile over the next few weeks. As one lender told me, “look – the bond market is tanking, and that moves inverse of mortgage rates, so they’re going to go up. It’s time to lock.” Another surmised that President Trump – that sounds REALLY weird to say – is likely to replace Fed Chairman Janet Yellen, who he’s said has been terrible at her job, with someone more aggressive. All of this is likely going to mean volatility for mortgage interest rates.

Moral of the story? If you plan on buying a home before Inauguration Day 2017, it might make sense for you to do it sooner than later – or at least lock your rate now. If you’ve read for any period of time you know I’m not prone to creating a lot of “the sky is falling” scenarios, but when it comes to what your monthly mortgage payment is going to be … well, it might cost a little more. The lenders I’ve spoken to today have been busy locking rates, and will likely continue to do so in the next several days. Failing to do so is going to mean your monthly payment is likely to rise as we deal with the uncertainty of exactly what a Trump presidency means for the economy as a whole, and the real estate market in the New River Valley in general.

These are interesting times.

Dusty keyboard.
Crazy numbers.

 

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Brexit – What’s It Mean For New River Valley Real Estate?

BREXIT.

By now you’ve likely heard that British voters have voted, in an historic referendum, to exit (or British exit = Brexit) the European Union. British Prime Minister David Cameron will resign later this year as a result, and the value of the British pound has fallen to some of the lowest levels since 1985. And, befitting a headline you’d expect to read on The Onion, The Washington Post reports this.

Regardless of whether or not Brexit is good or bad for the UK, EU, or the world, the United Kingdom is a long way away from the New River Valley – 3875 miles, roughly – so what impact will that have on the real estate market?

Everyone wishes for a crystal ball, but there is none. However, if I had one, this is what I’d say we should expect. In the short-term, it seems that we’ll see lower interest rates in the coming weeks, as markets worldwide seek an equilibrium. Not wanting to assume anything, I asked a few of our recommended lenders their thoughts, as well, on the whole Brexit thing, and what it would mean for home buyers (and owners) here in the New River Valley. They’re the best at reading the markets, and can usually give us a pretty good look into the short-term future of mortgage rates. Here’s what they had to say:

Kim Burke, LeaderOne Financial – “Markets reacted strongly to the news of “Brexit”, with money being dumped into bonds as uncertainty in Europe drives people towards safe harbor.  Things quickly simmered this morning as the news settled in, but expectations are to see rates continue to push towards historical lows in the coming weeks. Of course, as we all know — our crystal ball can only tell us so much — we’ll see what other news unfolds as Brexit plays out and how markets are affected. My recommendation — hover your finger over the lock button — if you see 0.250% or more improvement to the rates you’ve been quoted this week — grab it.”

Robert Mitchell, Prime Lending – “Good news for home buyers, mortgage rates are very likely to stay low due to a bold move by the Brits voting to leave the European Union (EU). The overnight trades were volatile where the British pound dropped to a 30 year low. Reactions like today’s trade are quick, mainly driven by confidence, and will balance out over the next few months. The overall outcome of this is going to take time to determine. This will be the beginning of a large change in the global politics. The following weeks to come will be volatile for the global markets. This will take rate hikes off the table with the FOMC for now. The vote was close, 52% to 48%. The impact of this daring move can last for years causing a lack of confidence in traders. This translates to mortgage interest rates remaining low if not lowering more. This is good news for those in the market selling & buying! Rates staying low means buying is still attractive and realistic!”

Ryan Stenger, Freedom First Credit Union – “Just like everything in the media this is creating big stir. Make no mistake this IS big news simply because it creates uncertainty in the market place. With uncertainty comes volatility in markets. I would expect the mortgage bond market that drives mortgage interest rates to move up and down a bit with lenders making many price changes throughout the day. If a lender quotes on rate in the morning another higher or lower rate in the afternoon, they are not trying to pull one over one you. No one has crystal ball, but we should know more about general  rate trends by middle of next week.”

According to them, we should be expecting a bit of a bumpy ride, but if everything goes as expected, home buyers and refinance loans should do well in the coming weeks. Feel free to connect here, or reach out to any of the recommended lenders above, for more insight!

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10-Year Growth Report in Blacksburg

Dusting off the blog a bit … been a while since I’ve posted here. The title of this post … snooze, right? But I promise it’s a little more interesting than that.

On Tuesday, I had the opportunity to speak with Bethany Teague, of WSLS, about a report the Town of Blacksburg had released earlier in the day. The report discussed how property values in Blacksburg – as well as in Montgomery County – had increased over the last decade, and highlighted some of the developments that have contributed the most to the Town’s tax base over that time.

The fact that property values in Blacksburg have increased so dramatically is really no surprise to anyone who’s followed real estate here for the last 10/20/30 years. Blacksburg has for many years had the highest median home values in the New River Valley, and much of that has to do with the solid foundation that Virginia Tech brings to the region. What I was suggesting in the clip above was that, while rising property values are certainly good for current homeowners, one thing that’s been a continuous theme among home buyers is that Blacksburg is sometimes out of reach for buyers looking to get into the market. Blacksburg may be at the epicenter of rising home values, but areas throughout the NRV – areas like Christiansburg, and Montgomery County in general – have also benefited, as well. You can see our previous market reports here.

One of the things that makes our real estate market unique in Blacksburg is that a town of ~ 50,000 people, with half of those residents living here only seasonally (and usually not buying houses, either), continues to stay strong. For “fun” (since I geek out on this stuff), I ran a quick search of median real estate sales figures for Blacksburg over the last ten years, and have posted those below.

YearMedian Sales PricePercentage Change
2005$213,097-----
2006$231,0167.8%
2007$234,8141.7%
2008$242,0193%
2009$230,460-4.8%
2010$243,6555.5%
2011$228,736-8.2%
2012$232,1031.5%
2013$253,8778.6%
2014$234,563-7.7%
2015$255,0488.1%

While sales figures in Blacksburg ARE higher than other areas of the New River Valley, one of the things that gets overlooked is that our tax rates are still relatively affordable. When compared to other regions of the country, which may see tax rates swing as much as 60% from one municipality to an adjacent municipality, the New River Valley continues to be one of the most affordable – and wonderful – places to live.

Thanks to WSLS for reaching out, and to the Town of Blacksburg for the report. If you’d like to read the Town’s report, you can do so here.

 

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That Rental Amount Seem Too Good To Be True? It Probably Is.

Craigslist scamI’ve written about Craigslist scams and rental properties before, but it seems that it’s hit someone here locally again, according to this article, by Travis Williams. Thankfully, it seems that the seller’s weren’t harmed any more than just unnerved, but it brings up a good point – for both renters and homeowners.

If you own a home, set up a Google Alert for your address and/or keywords, so that you’ll be notified when your listing gets “scraped” by these idiots. They’ll find your listing online, then repost it with the same language, even the same photos, and usually an absurdly cheap rental rate. Then, they’ll attempt to lure someone into wiring them money for the first month’s rent, and maybe the security deposit, never to be seen or heard from again.

And if you’re a renter? Beware the ridiculously low rental rate. If it seems too good to be true, it almost certainly is.

The Internet Crimes Complaint Center are a nice recommendation, but we’ve been reporting these scams for several years, with nary (I just wanted to use the word nary) a response or acknowledgement. You’d be better off just being vigilant, doing your due diligence, and if you have a question about the validity of a rental, contact a quality property manager for verification. These scams are so ridiculously simple that it’s surprising they continue to work, but obviously they do – they keep showing up.

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