Tuesday, December 19, 2006

St George Utah Heritage

St George Utah - A Special Place!

St George Utah is a special place to live. Tis the season to be grateful for our men and women in arms, this free country where we enjoy so many privileages and to those who have gone before- our Pioneers! We have many like kind individuals in our midst... civic, business, church and in our community, giving that the rest of us may have life more abundantly. Yes, it is our heritage to follow in their footsteps and find our own pioneer in us.
Special Event
Southern Utah Heritage Choir Heritage Week Fireside January 14, 2007.
In commemoration of Heritage Week, the Heritage Choir will present a Fireside at the St. George Tabernacle on Sunday, January 14, 2007, at 7:30 pm. Under the direction of Keith Bradshaw and Nancy Allred, the choir will be joined by the Heritage Brass in presenting music to remind us of those who first settled the St George Utah area and built a strong foundation for those who live here now. They, the builders of the Nation, This Good Earth, Redeemer of Israel, Where can I Turn for Peace, A Gaelic Blessing, and Let Zion in Her Beauty Rise are just a few of the songs for the evening. The fireside is under the direction of the Heritage Week Committee and will feature a speaker as well as music from the choir. This concert is free to the public.

Thursday, December 14, 2006

2006 in Review: Market at Large vs. St George Utah Real Estate

The Real Estate Market at Large

2006 was the year of market correction. All the signs were there, we should have known even more that with double digit appreciation gains, what goes up, did go down. The first signs started at the end of 2005. But altogether, we have not experienced a bust, even though many, especially the media was apt to point towards a bubble bursting.


Many real estate markets in the country still experienced above average sales. Yet this market has morphed into a buyers market. The decrease in sales has led to layoffs in mortgage companies and other industry participants. Investors had only encouraged other like-kind thinking- people were moving and considering it as their investment.

Nicolas Retsinas, director of Harvard University's Joint Center of Housing Studies makes a good case that while prices and the market are normalized, that it was the media and not higher interest rates that made is so, inciting an analogy of a match that is lit that becomes hard to extinguish in lieu of all the appreciation and possible mentality of a bursting bubble that was to come.

Interest rates have not really gone up all that much as compared to past cycles. However, interest rates do cast a singular variable potentate upon how home prices can get affected from here. Unconventional mortgage products widened the funnel in recent past, that added to the price increases. With the increase of supply of homes on the market, some have given thought to the idea that some of these unconventional loans contributing to supply, with perhaps setting up more consumers for foreclosure possibilities in the face of fixed rates that change to variable rates in the beginning of this next year. However, the before mentioned Restinas, cites how many appear to be compensating already by just refinancing to more conventional loans. Also Edward learner, director for the University of California, Anderson Forecast says that a lot of home owners can even still rely on an "appreciation cushion", that a profit is still in store should they decide to sell.

The overall economy is stronger than when we were in the fervor of price appreciation. Kenneth Jenny, CEO and managing partner for real estate consulting company tranCen said "The market itself has become right-sized. A right-sized market doesn't allow quick, inflationary numbers." Flippers have largely left the market taking away the frenzy that existed during the boom. Affordability is a problem in some markets, which oversupply and sagging sales will take care of that problem.

St George Utah Real Estate

The St George Real Estate market has been affected pretty similarly. As a strong place to do business, rated one of the safest places to live, one of the best places to retire, etc. St George is not projected to suffer for too long amidst perhaps a little blip that may be an ongoing experience into this next year.

Our unique situation, as well as I have been able to glean from reports through colleagues who have seemed to have had their finger on things in the past, report that just before the "word got out" about this high mountain desert, almost resort atmosphere of a town, the city had restricted or had been back-logged- anyway the housing supply or number of building permits allowed was restricted. Well, when the frenzy hit, we were not prepared with supply. Perhaps this had something to do with..., and largely from hindsight... the market had the fourth fastest appreciation rates in the country.

As a result of this most recent decline, "life-stylers", retirees, and baby-boomers , have been put up on their feet for a bit, making wise or "sage" pause toward inaction. This population group constituted a good influx of our buyers. We have experienced, maybe more than average price reductions, if not comparable to the rest of the nation at large. While many have been skeptical of buying here, the stagnation hits into our "snowbird" season too; making for an element of temporary uncertainty. But amazingly people with money- namely a few retirees and baby boomers, those who are "late bloomers" in hearing about he attraction of St George, most likely will not be kept at bay forever.

But the average "Joe" that sustains the working class, to including our teachers, policeman and city workers, have long awaited these price reductions and locals have shown a resilience in holding off the buying pattern. So houses under 250K to 300K, are likely great realms for builders to downsize to, if we are talking about "real" supply. That is your eye on the St George Ut real estate market and the market at large for 2006!

Thursday, December 07, 2006

St George Ut Real Estate Total Sales Related to Homes Sales Nation Wide

Home Sales Nation Wide
Home sales nation wide have teadily declined according to a Pending Homes report or index designed by the National Association of Realtors to be a leading index reflecting what the market is doing. We've gone from 124 units in October of 2005 to about 107 units in October 2006, about a -14% nation wide and -17.4% for the Western states.
Total Sales in St George Ut
For St George Ut Real Estate or Washington County, total sold listings, which includes commercial, residential and lots have gone from 435 in October of 2005 to 329 in October of 2006, according to local Washington County Board of MLS reporting statistics, which would be about a -24% reduction in total sales.
Comparing Tatal Sales Locally to the Home Sales Nationally
We recognize we are comparing House Sales Nationally with Total Sales locally and we do this only because this is the only graphical information we have on hand. It helps to see, that the national downward trend in number of purchases is fairly parallel with what is going on locally as well.

Wednesday, November 15, 2006

St George Utah area Total Sales Monthly for 2006

Go to our site to see latest statistics on the market. But to find that home use Brian, your handi-dandi St George Realtor. Coming to you live (live update) from the hot seat, here in St George Utah set in mild winter weather, scenic Pine Valley Mountain and proximatey of Zion National Park- don't miss out on this piece of high mountain desert! Actaully, now is a good time to buy, because we have shown an ability to be a true haven for flocks and I'm not just talking about snow birds, although we have those too. We were the second fastest growing community last year for our size.

Saturday, November 11, 2006

The Ebb or Flow? - 2006 St George Real Estate

As 2006 wraps up realtors consign themselves to an already consitent lack of transactions. However, the ebb in the hallways here at RE/MAX has gave way to a couple of reports of increased business. Has our ebb turned into a flow? I do think it has picked up a bit.

We would like to report to any of our people looking for information about Southern Utah and Southern Utah real estate, that we have updated our pages to give a lot of information about this red rock, vista-ed experience, cognisant of the "SouthWest"- at Southern Utah Real Estate. Find out how our prices compare to the rest of the native southwestern area.

Also, I would like to mention that The Inn at Entrada is a nice little RESORT get-a-way place. I had the chance to use their facilities and stay in one of their suites last night and the experience was literally awesome. Of course my wife and I (5 kids) needed such a take-me-away, set in the flowing water features- "shower" me away is more like it, if you like swimming under a water fall, type of experience as that. I opened my blinds this morning to flowing water admist lava rock, pond and red, red mountain majestic. Take me away! Not many people know that The Inn at Entrada is kind of like Green Valley resort condo's, you can rent them for days, weeks or months and the facilities manager their told me that theirs is nicer- I believe!!!

Saturday, October 28, 2006

2006 Statistical Market Review and 2007 Outlook for St George Utah Real Estate

Important Announcement: an update on the market and as such gave us insight into what's ahead. Also, how do lenders ensure they are not buying properties that are overpriced in this market? This coincides with buyers new buying patterns. Understanding the nuances of the real estate market is precisely what you expect from an agent - especially in a buyer's market. Whether it be interest rates, number of homes on the market or market conditions, Brian has the knowledge and experience your looking for. Taking advantage of lower interest rates before they possibly go up and taking advantage of larger inventories... makes Brian's help... all the more needed. His track history includes many happy buyers and sellers. We recommend that you use Brian to navigate this new market. You can literally get excited with the service he can provide you- your trusted advisor. Contact Brian for immediate help!

Saturday, October 14, 2006

Predictions for the Future

I think from my September post that since that, time has only confirmed what we are all feeling and that is that market prices have been coming down a little bit. I don't know that they have come down a whole lot though for houses priced under 300K; otherwise, yes.

What are some projections for the future into next year? I've consulted with a few realtors I think highly of and we have come to the view that the demand will pick back up (or sustain) next year (possibly earlier vs. later) for homes in the lower price ranges and that building them, while still taking place, will not be totally halted, flooded with supply or derailed from continueing. Please realize that know one has a crystal ball on this thing. However, we do have some basis for saying this. That is that we can tell that the commercial sector is still viably growing. Take for instance the new jobs for the new Wal-Mart, hospital or the new Viracon glass factory. All of these industries will feed other industries coming in as well, which all means new people to the area.

A noteworthy note it is... then to say as your trusted advisor, that it is not all too bad a time to buy in my opinion when prices have actually come down a bit, eh. There are some mentalities out there of a lot of people, that say they are going to wait until they see where things will go. Yes, and I don't particularly have a crystal ball on the subject except to add that well, if there are a lot of people waiting, what happens when they all see it is time to move because things are coming back up. If you wait to act untill then, where does it put you then... is a good question to ask. Buying higher? That is why it is good to buy now if you are buying selectively. So, give me a call if your ready to move on getting something lined up.

Make sure to read the last post, I wrote it at about the same time here.

St George Condos

I can speak to a segment of the market because I have a listing there that is getting more action than it had before and that is if the St George condos market. From where I stand, one condo listed at this time, I really think it is picking up in demand. Well, if you figure that there might be many "snowbirds" flying south for the winter, it all seems to make sense.

Tuesday, September 26, 2006

As September 2006 closes up this Quarter of the Year

As September closes this chapter of the year, it is pretty much common news headlines now that prices are actually falling nation wide for values of real estate- prices can actually can go down. In taking a some retirees out to Sun River today they told me that they wondered if St George was the exception to that. While my sources have cautioned me against the price reduction frenzied "seasoners" in saying that property is not selling healthily at all, I am constrained to say that with enough of what I've heard and seen of, in going to Washington County Board of Realtors meetings where property gets talked about, it has to be coming down here to. We are all hanging out there - should come as no surprise to us "Polyanna" types who don't listen to all purveyors of doom and gloom hype. Or us types that want to use denial again, I would have to wake up myself and say, there seems to be enough evidence, you just can't have that many price reductions and NOT have falling prices, can you?... I don't think so, but I've been wrong before.

And to those who have a crystal ball, please call me. However, I don't know if it is in my last post or not, but a key information source, told me that just like the stock market bids people to buy correctly- that is selectively when prices are falling, that starting now and towards the end of the year and beginning of next, is a GREAT time to BUY. Remember, St George Utah Real Estate is always a good bet. We are centrally located and have what crazed Californians and "Urbanites" love, good safe environment, majestic red rock scenery, temperate climate, National Parks... And so centrally located too. Go figure.

Wednesday, July 19, 2006

Housing Starts

The below material is taken from Inman News, Wednesday, July 19, 2006:

Double-digit slowdown reported in single-family sector -- Permits drop in June

"The rate of privately owned housing starts dropped about 5.3 percent in June compared to May and fell about 11 percent compared to June 2005, the U.S. Census Bureau and Department of Housing and Urban Development announced today.
Single-family housing starts dropped about 6.5 percent from May to June to a seasonally adjusted annual rate of about 1.49 million, a decline of about 13.8 percent compared to the June 2005 rate. The June rate for units in buildings with five units or more was 306,000.
For the first six months of 2006, the seasonally adjusted annual rate of housing starts dropped about 3.1 percent compared to the first six months of 2005.
The seasonally adjusted annual rate is a projection of a monthly total over a 12-month period, accounting for seasonal fluctuations in construction activity.
Privately owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of about 1.86 million, which represents a 4.3 percent drop compared to May and a 14.9 drop compared to June 2005.
Single-family building-permit authorizations in June were at a rate of about 1.4 million, which is 6.3 percent below the May figure and 17.5 percent below the June 2005 rate. Authorizations of units in buildings with five units or more were at a rate of 397,000 in June.
Privately owned housing completions in June were at a seasonally adjusted annual rate of about 2.02 million, which is 6.4 percent above the revised May estimate and is 2 percent above the June 2005 rate.
Single-family housing completions in June were at a rate of about 1.74 million, which is 7.5 percent above the May figure of 1.62 million and 2.5 percent above the June 2005 rate. The June rate for units in buildings with five units or more was 255,000.
The agencies noted that month-to-month changes in seasonally adjusted statistics can show irregular movements. It can take four months to establish an underlying trend for building permit authorizations, for example, five months for total starts, and six months for total completions.
Statistics in the reports are estimated from sample surveys and are subject to sampling variability as well as non-sampling error including bias and variance from response, non-reporting, and under-coverage. On average, the preliminary seasonally adjusted estimates of total building permits, housing starts and housing completions are revised about 1 percent.***

Tuesday, July 11, 2006

St George Real Estate Market Update for July 2006

Market conditions have been about as predicted in line with the rest of the nation, that prices would temper. In our area, that has meant "flat lining". While sales have been taking place, one does wonder if the builders weren't just hit hardest. Well, take that in lieu of, earlier in the year, Sellers still thinking they could "ask for the sky" while asking it... and getting it... has proven to be a bit disparaging. So, while price reductions have been the call of the day with a somewhat dramatic increase in inventory, still those Sellers that have been realistic in pricing have sold their homes. In other words, while sales can't compare to last year, they have compared somewhat with 2004, our second highest year- sales are still taking place. Here are the numbers below:

Washington County Sales
Year Jan. Feb. Mar Apr May June July Aug Sept Oct Nov Dec Total for the Year
2002 357 395 469 472 545 452 506 482 416 474 424 473 5465
2003 423 454 516 560 559 592 601 618 578 617 485 664 6667
2004 547 606 830 873 850 975 903 978 943 946 936 950 10337
2005 789 784 1185 1129 1114 1167 1004 1084 1133 1094 984 908 12375
2006 763 689 847 795 813 831 4738

Among some realtors there is expression of a declining market. Our estimation is that while this is being felt, that our market is rather stabilizing with what would be more normal appreciation rates and moderating influences. The unemployment is projected at about 4.9% and other factors seem to be stabilizing enough to project that the market will stay in this more moderate or "compensating" (for last years 4th Fastest Appreciating ) market.

So, is St George Utah Real Estate a good bet? Those that have seen the potential for growth last year as the nations 2nd Fastest in U.S. per capita KNOW that St George Utah, being so centrally located, family and community values based, is poised to be that conglomerate attraction for retirees, second home owners and for all range of working class families.

Tuesday, May 23, 2006

St George Ut Real Estate Update

A quick update on the market. While everything looks to be getting price reductions and more houses "hang", I've heard two views; one from my title guy who has had a pulse on the real statistics (# of transaction) from March 2006 and one view from two other sources about the builders getting "hung-out" with the prognosis to be lower land prices even if it takes till 2007.

The first view with an eye on statistics from March says that homes are selling and selling at NOT much lower prices, just that they are taking a lot longer to do it in. In March, sales parallel 2004, which was still a pretty high year. Nothing will compare with 2005 anytime soon. But Aprils stats show a considerable drop that while is nothing tell tale of the future, as the market has gone up and down from month-to-month as a fairly common phenomenon, but none the less a considerable drop in the number of transactions.

One interesting thought process from my title company reference is that the jump in the average price from 270k to 320k (don't quote me on the exact figures) or there abouts, is because there are less investors buying into homes that are in the lower price brackets where they can have the rent cover the mortgage.

I've had two seperate sources repeat the same thing, that many builders are in "trouble" with the new homes they have built that are still sitting on the market and that in needing to liquidate are having to sell them at practically cost. Another tid-bit was about how investors who had planned to flip a few of those new construcion homes are now into a default condition without them moving. Also, a comment from a school executive that was that his awareness leads him to predict land coming down in price by next year, as much as 20%-30%. By the way, he also conceded how it was that the district has had a huge problem with many teachers applying to the area- yes and yes when they went to house shop we pretty much lost them all. Much of that was bolstered by an infusion of older, retiree-aged, teachers who are the better with experience and with the desire to teach 'not because they have to but because they want to', he said. That did help buffer our great loss.

I side more along my title guy's March optimism based upon those numbers, and attribute Aprils lack of transactions to a blip along the radar screen and do not yet pretend to know what I do believe is a trend from some builders and investors getting "nailed" to how large the reprocussions will be felt throughout the entire market to include the resales. Our area has boasted a huge growth in the small business factor, enough to gain ranking in the nation. We are centrally located and gaining more and more notariety. But we are still relatively small compared to bigger city and we have to remember that growth takes place over time. So, I believe the market will "steady itself out" without the increases in prices we saw in 2005, almost to compensate for a time; but not to the level of decompensating. Yet, some do feel the affects of and almost all do feel the affects of in terms of 'time on the market'. Interest rates are going up right now too- still relatively lower though in the lower 6's.

Your eye on the market wants you to remember that our services are on the front end of the curve, so if for all your real estate needs we hope you call us- you deserve it!

Friday, March 10, 2006

Average Time to Sell Has Increased

We've pushed the average buying frenzie down to a lull to now more than 30 days to get a home sold. It should not be taking this long, but it is. Most listing agents and sellers do not want the home to "sit" for more than 30 days, so getting the price right on the home is even more imperative for these sellers. We believe, particularly with higher end homes, that the listing agent needs to not only engage in past and current sales on the market for pricing a home, but also in looking at and perhaps even visiting the current direct competition.

Nationally speaking and on the flip side, home prices have moderated in price only, not deflated. A recent survey is compelling to think about in terms of how sellers are still getting higher prices. A couple of surveys conducted by House Hunt reveal respondants view where "82 percent say they are getting 95 percent or more of asking prices. This compares with 80 percent in the third quarter and 90 percent in the second quarter of 2005."

Overall national sales data and forecasts of top industry econonmists say, "We are optimistic that a sustainable, more balanced housing market will be the cornerstone of the U.S. economy in 2006." This eye on the market is brought to you by Brian Habel, your local expert for any of your real estate needs at St George Utah Real Estate.

Thursday, March 02, 2006

Slow Down

The market it slowing down and more inventory has been building on the market. It is pretty obvious by now- most people have noticed.

Interest rates have been bouncing around with the national average in November being the highest in 3 years at 6.33%. Now it has fallen to 6.27% in December 2005 and in January 2006 to 6.15%. A coorelation between where interest rates are and the number of purchases does seem to exist. However, relatively speaking, interest rates are not that high and as such moderate purchasing will probably still take place.

A recent (3/2/06) article on MSN says that while home sales cool off, prices don't. Some of the same exists here in St George. However, we have seen lots of homes get price reductions, meaning perhaps that many have thought to get a lot higher price for their homes than the current market will render. So homes are sitting a lot longer and inventory levels are up. Interestingly, while it is not a Sellers market anymore, perhaps because prices are still relatively sustaining themselves, it is not a Buyers market either.

Projections and outlook is that things are stabalizing and prices will have to cooperate for those needing to move there houses in a faster time frame. Buyers will have to be astute to recognize those houses that are priced right in order to move on something. Occasionally a seller of a piece of property will show evidence in the price (either at first being introduced OR of having a price reduction) of being very motivated-- those homes/condos/land may appear to have been sitting and then all of the sudden... be gone. This is our update on the market.

In our view, St George Utah real estate will always be a safe bet as people increasingly look for better places to live. We have it all here: National Parks in close vacinity, low crime, family freindly, mild climate, snow sports one hour north for those needing a flavor of that, hiking, golfing, bicycling, water sports, etc. You name it, we most likely have it. You can't say that about Arizona, that I know of. Yet, most people do not know that huge population explosions are taking place there because of the mild weather. So, in my view, we are still one of the nations best kept secrets. With all the fan fair of yester year, most would not still think so.

I think we still need to do something to make it easier for our teachers, policemen and city workers to settle into our area. Some denser housing projects might be the answer. Think about the gap between home owners owning in the 150K to 200K range and those in the 250K range. Now think about the gap between those who own some real estate and those who don't. Where is the bigger gap in those two examples? Well, after last year I side with those who need to just get into any piece of real estate. However, one view expressed also is that with the slow down of appreciation, the new home owner will not see a lot of equity built, particularly if as many first time home buyers of now-a-days do, come in with no money down.

Sellers will need a good realtor to be able to make sense of pricing because pricing it wrong can have LONGER consequences.


Monday, February 13, 2006

Parade of Homes- St George Utah

Come feast your eyes on St George's home show which takes place annually as part of featuring and showcasing some of the finest home building in the country. Take advantage of our nearly 70 degree weather we have already been having with over 300 days of sunny weather.

Our home show, the Parade of Homes takes place February 17-26 and is very popular, so book your hotel reservations ahead of time. By now it may be too late.

The 25 homes take about two days to view with rest stops and breaks. Tickets become available at Lin's Grocery on Feb. 16 at 5 PM and are $10 for age 3 and up, no senior discounts.

Features of the homes include completely automated homes, "philosophies of green building with the use of proven construction techniques and materials, innovative home entertainment systems, garden courtyards, and infinity pools and spas, " according to the Parade of Homes website.
Inventory Levels

Inventory levels of homes are up here in St George. Buyers have many more options than they did last year. Interest rates appear to be heading up, so with the increase of inventory, now may be a good time to buy here in St George, before those rates do go up. Your St George realtor, along with the Brian Habel team is prepared to meet and exceed your real estate needs.

Saturday, January 28, 2006

Market Projections-- RE/MAX chairman, Dave Liniger and other National News Figures

A recent article/email was sent to me from InWest Title Marketing and Escrow Officer, Michael Dinsmore in St. George, Utah, conveying and article written by Blanche Evans. Among the things discussed is the outlook nationally. A couple things worth highlighting is that the markets inventory levels are still in the range of being a Sellers market, although on the borderline of being neither a Sellers nor a Buyers market.
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For all those newbies out there, a Sellers market means that conditions are favorable for Sellers and not Buyers. Those conditions would include a low inventory of homes like theirs (the Seller), making theirs more valuable, therefore in being able to get a higher price. Also, the supply of homes are affected by interest rates. If they stay low or lower, then the enticements lead Buyers to buy and with a higher amount of Buyers, the Sellers are sure to pull a better price with more demand on his/her home. Remember that people still have to move on occasion and will tolerate a little higher interest rate than our current lower 6%ish rate. They do it out of necessity and circumstance. Visit our page St George Homes For Sale for more Seller tips and information.

Hopefully you will see from the following article written by Blanche Evans that our recent blog predictions and information look "right on". See News Release below (NAR is abbreviation for The National Association of Realtors):


As Predicted, NAR Sets Fifth-year Sales Record -- What's Next?
by Blanche Evans

Despite a nearly six percent decline in home sales in December 2005, existing housing sales easily set a fifth annual record, but what does 2006 hold in store?

Total existing-home sales, which include single-family, townhomes, condominiums and co-ops, were up over 4 percent for 2005. Over 7 million homes were sold, up from 6.8 million in 2004.
David Lereah, NAR's chief economist, says he expected the monthly sales decline. "This is part of the market adjustment we've been discussing, with a soft landing in sight for the housing sector," he said. "The level of home sales activity is now at a sustainable level, and is likely to pick up a bit in the months ahead. Overall fundamentals remain solid, driven by population and employment growth as well as favorable affordability conditions in most of the country, so we expect the housing market to remain historically high but lower than last year's record."

The national median existing-home price for all housing types was $211,000 in December, up 10.5 percent from December 2004 when the median was $191,000. The median is a typical market price where half of the homes sold for more and half sold for less.

But this may be the last year that housing sees double-digit gains for a while.

NAR President Thomas M. Stevens from Vienna, Va., said it may take a while for home price growth to cool. "We're coming off of five years of tight supply, and many sellers are accustomed to expecting very strong price gains and exceptional returns on their investment," said Stevens, senior vice president of NRT Inc. "With the supply of homes improving and buyers having more choices, the rate of price growth should come down to more normal levels this year."

Currently, says the NAR, there's a 5.1 supply of homes nationwide at the current sales pace, which is getting close to the 6-month benchmark of a "normal market," which neither overfavors the buyer or seller. Below six months of inventory, homes are said to be in a seller's market, where conditions favor the seller due to demand. Above six months, conditions favor the buyer, due to increased inventory.

Is it time to panic? Will sellers be unable to sell their homes?

"The sky is not falling in the housing markets, only cooling," reasons Lereah. "After five years of record-breaking performances, the housing sector is taking a breather -- home sales are falling and price appreciation is slowing. The great fundamentals that were in place that initially generated the boom -- historically low mortgage rates, favorable demographic trends (substantial home buying from boomers, immigrants and boomer children), and reduced home buying costs from technology innovation (Internet home search and mortgage application and closing processes) are still in place today."

Interest rates, according to Freddie Mac, are dropping. The national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.27 percent in December, down from 6.33 percent in November; and is 6.10 percent currently.

"If lower interest rates are sustained, the housing market could see some unexpected lift," Lereah says.

Yet, according to the California Association of Realtors, home prices are rising, but sales decreased nearly 18 percent in December. Why are sales trending toward softening?

"As the boom winds down, investors are exiting the markets, cleansing the speculative element in housing," explains Lereah. "There may be a handful of interest-sensitive local hot housing markets that experience a short-term contraction, but for the nation, as a whole, the boom is winding down to an expansion."

RE/MAX chairman, Dave Liniger predicts 2006 will be the second best year the real estate industry has ever experienced.

"I don't think the last two months are anything worse than a normal cycle of the real estate business. November and December declines were a normal reaction to fluctuating interest rates. This year we would anticipate that resales will probably drop 4 to 5 percent from the record pace that they were last year. I think we are going to see an outstanding year for the real estate business."

Like Lereah, Liniger expects housing prices to retreat more in some parts of the country than others, but for most regions, housing is unlikely to show a dramatic collapse, although he suggests, "You do certainly have to be a little concerned with properties that have shown double digit appreciation on both coasts."

He says the market will be much more "normal." "You're going to see price appreciation, depending upon the region you're in, somewhere between three and six percent."

One of the reasons that the housing market has been on a record setting pace is historically low interest rates. Liniger believes that rates may climb somewhat in the upcoming year, but not enough to derail the real estate market. "I think you're looking at very reasonable rates in the neighborhood of six-point-five percent before the year is over."

For clues to the future, Liniger advises keeping watch on the Baby Boomers. "They'll continue to keep the market hot," he predicts. "They see real estate being a very, solid investment, unlike recent experiences in the stock market. So, I think you're going to see second home sales continue to be very, very strong."

Published: January 26, 2006

Thursday, January 19, 2006

Economic Summit 2006

I'd like to talk between the lines with two sources I have come accross in telling what the demand and in predicting what the market will do here in the local area of St George, Utah for the year of 2006.
First Source
The first source is an article from January 2006 copy of REALTOR Magazine, entitled "2006 economic outlook- A Stellar market by any measure". This source comments, "Despite lagging consumer confidence, the economic fundamentals are good. Continuing strong population growth, fueled in part by immigration and new household formation by boomer children, is keeping housing demand at peak levels." An easing housing shortage with increase of inventory on the market, although still lower than usual, will soften price appreciation. That is on the grand scale. Now for the St George Utah area.
Second Source
Recently an ecomomic summit 2006 was held for this areas real estate, Saint George as its chief anchor city. The report puts appreciation values for 2005 as among the highest in the nation for real estate.
In looking forward to 2006, a look at what the projection of what interest rates plan to do is in order. The summit comments that, "The 30year fixed rate mortgage should trend up modestly and reach 6.6 percent during the second half of 2006." To continue with predictions and comments from the summit, "The residential construction market is showing initial signs of slowing nationwide. However, in Utah homebuilding remains strong with residential construction concentrated in Salt Lake, Utah, Washington, and Davis counties. All indicators point to a vibrant residential construction market, with singlefamily housing accounting for much of the growth.
Average U.S. home prices increased 12.02 percent year over year from the third quarter of 2004 through the third quarter of 2005 . Utah continues to show noticeable house price appreciation with annual price growth of 11.4 percent. Utah’s ranking jumped to #22 , compared with #31 in the previous report and last place in the fourth quarter of 2003. St.George came in at #4 in terms of highest rates of house price appreciation when compared to other “Metropolitan Statistical Areas” with a one year appreciation rate o f 31.57% .
While there may be a housing bubble on both coasts, it is not likely the case anywhere in the intermountain West and certainly not here in Utah. Growth in our market can be attributed to nice homes in great neighborhoods. We enjoy spectacular scenery set in a mild climate. We have amenities and cultural offerings often times reserved for large metropolitan areas. We have the peace of mind associated with worldclass healthcare and a sense of security that comes from below average crime statistics. All in all, we are living in a pretty great place. Bot tom line, 2 006 will be another great year for investing, owning and transacting real estate in Southern Utah!"
Summit Report- inclusive of
Among the things included in the summit report are:
The St George MSA (Metropolitan Statistical Area) was the fastest growing area in 2003 according to the Census Bureau. Graphs show single family residences, land, lot and water, and condo townhomes. The graphs show the number of sales for the last five years, which 5 subset areas contained which portion of that, the last three years month-by-month sales prices graphed linearly and average quarterly sales prices for the last three years compared side by side. Other items covered are: residential building permits and for what areas, housing inventory, future big developments, home appreciation forecast, affordability index at its lowest, where is the in-migration coming from, market indicators, global economic conditions, median price appreciation for 2006 real estate, Saint George report on foreclosures and general investment analysis.
To access the power point presentation off our website go to the in-line paragraph link we placed in the third paragraph of this article above. Hope we are keeping you abreast and alive about St George Utah real estate.
Reading Between the Lines
Our reading between the lines takes on the dimension of caution pertaining to what interest rates will do. But while caution seems to be invoked in the Summit report, I believe that it is mostly due, at least in part, for cautioning realtors and sellers to not be so ambitious as to what they can expect to get when our appreciation rates were among the most illustrious in this last year. Still the astute will read between the lines, that St George is St George's best kept secret in order to preserve our economic base- we are small and can only grow so fast people.
Bigger Homes, Bigger Inventory
To what degree have we overbuilt in our larger home department may be a good question to ask? Because my shopppers are noticing quite a bit of those on the market these days. Yet these days really ought to mean Nov. 2005 because as the graphs show, December and January are always slower.
St George Area Parade of Homes
We will see what happens in leau of our annual St. George Area Parade of Homeskick up to take place Feb. 17-26, 2006. Mostly, I am not worried about this year being a good year for real estate values, except for what interest rates will do.