Winter Blues

The Winter season is normally the cold period for Real Estate. People are busy enjoying the holidays and traveling with loved ones. The last thing they want to do on a blustery Sunday afternoon, is to go look at property. Most people wait until the Spring to put their house on the market.

However, in the current economic climate and with housing inventory sky high, you may not have the luxury of waiting. As more debilitating economic news filters down, consumer confidence plunges.

While homes that are priced right traditionally sell, motivated sellers are encountering many problems with reaching potential buyers. There are just too many choices. If you wait until the Spring like everyone else, you may find more buyers, but also encounter an increasingly overcrowded inventory.

Interest rates may be higher (or lower), and the market may have moved. The only thing you are guaranteed of, is that your will be paying property taxes and mortgage payments. If you are serious about selling, thoroughly market your home (virtual flyers, syndications, vids, mls) and try to catch the serious buyer now.

Any questions or for FREE customized Market Reports, automatic email updates on properties that fit your criteria, or Realtor Referrals, please EMAIL ME or call me at 734-478-9270. -Anwell Tsai

The power of inflation (or deflation!)

The erosion of purchasing power (inflation) occurs when the general level of prices rises. Changes in anticipated inflation can have a significant impact on Real Estate. Changes in perceptions of long term inflation often cause mortgage interest rates to rise, affect affordability and therefore prices of property.

Inflation and appreciation affect yield rates in different ways, though their affects on future values are similar. Assuming that the risks associated with a property remains the same, appreciation has no effect on yield rates.

Unexpected inflation cause yield rates to move upward as nominal rates of return adjust up. Indicators of inflation include the consumer price index (CPI), wholesale price index, and the Gross Domestic Product (GDP) implicit price deflator.

Any questions or for FREE customized Market Reports, automatic email updates on properties that fit your criteria, or Realtor Referrals, please EMAIL ME or call me at 734-478-9270. -Anwell Tsai

Pricing Property

Pricing property is part art and part science. Besides locating similar homes to compare towards, home buyers and sellers must make certain pricing adjustments, based on market data. Though people traditionally take into account differences in size, number of bedrooms, and upgrades, they often overlook several crucial elements.

These elements include adjusting prices depending on which property and/or personal rights were sold, motivations of sale, market conditions, and financing adjustments. Click here to learn about financing adjustments in a blog I wrote for BiggerPockets.com, a Real Estate Business site where I am a weekly contributor.

Any questions or for FREE customized Market Reports, automatic email updates on properties that fit your criteria, or Realtor Referrals, please EMAIL ME or call me at 734-478-9270. -Anwell Tsai

Why it's good to purchase in a down market

In a red hot market, prices are appreciating, credit is easy to come buy, and everybody is making a bundle. People are in euphoria and are purchasing houses without truly analyzing the market and forecasting changes. The only sure thing is that real estate is cyclical in nature and will have peaks and valleys. Emphasis should be placed on the fundamentals.

People who purchase in a hot market often expect appreciation to be the sole measure of return and have a short time horizon. As an asset class, Real Estate is an extremely risky investment in the short run because of high transaction costs, illiquidity, and market inefficiencies. With a long term time horizon, returns generated from tax deductions, rent (or enjoyment of ownership), amortization, and appreciation increase. Depending on the motivation for purchasing, individual’s financial strength, and time horizon, buying in a down market is offentimes less risky than buying when the market is “good.”

Any questions or for FREE customized Market Reports, automatic email updates on properties that fit your criteria, or Realtor Referrals, please EMAIL ME or call me at 734-478-9270. -Anwell Tsai