The past 18 months have taught us many things, not the least of which is that we don't have control over a number of variables that affect the real estate market. However, we do have control over the actions we take to prepare for and react to these variables. During the next 60 to 90 days, some significant housing-related changes are imminent. We can't control those changes, but to a certain degree we can control how they affect us.
Can't Control: Expiration of Federal Housing Tax Credit
Can Control: Purchase Date / Closing Date
While we can't control how the expiration of the Federal Housing Tax Credit will affect the real estate market, it is an absolute certainty that qualified first-time buyers will receive up to $8,000 and qualified repeat buyers will receive up to $6,500 if they enter into a purchase contract by April 30 and close by June 30. With less than 90 days until the expiration of the Federal Housing Tax Credit, buyers need to be in the market now.
Can't Control: Mortgage Interest Rates
Can Control: Locking in Today's Rates
No one knows what will happen to mortgage interest rates when the Fed ends its $1.25 trillion purchase of mortgage backed securities in a few weeks. But one thing is for sure. Home buyers who lock in their interest rate today will benefit from some of the best mortgage financing conditions in history.
Can't Control: Selling Price
Can Control: Asking Price
If you're a seller, the price you paid for your home or the amount you owe on your mortgage has no bearing on your home's ultimate selling price. What does determine that price is the market. And today sellers must show consideration for the market with correct pricing right out of the gate. The chart below shows just how important Original List Price (OLP) is to selling your home for the highest possible price in the shortest amount of time.
2009 Sales Data
Homes with no price changes Homes with at least one price change
Average selling price as a percentage of OLP Average days on market Average selling price as a percentage of OLP Average Days on market
96%
116
82%
240
Source: Agent Metrics, MRED LLC data, 2009, Selling Price to Original Listing Price, City of Chicago.
One more thing you can control is your choice of real estate agent. Thank you for allowing me to serve you, and please contact me if you or anyone you know needs help navigating today’s real estate market.
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