Looking for a home for sale in the general Birmingham, Alabama area?
Here’s an update we’ve produced on market activity in Lake Forest, a popular Shelby Co. neighborhood that’s an easy drive into downtown Birmingham:
Let us know if we can help…
As Fisbo, our highly spoiled six pound poodle, and I took our early morning walk a few days ago, I used the time to contemplate how our real estate business has evolved during 2011 and thought about what’s ahead as we kick off 2012.
Our walk was made rather intriguing because the neighborhood was shrouded in fog, limiting visibility sometimes to only a few hundred feet.
You can’t see very far ahead, and as you keep moving, what’s behind you grows increasingly vague.
Predicting home sale trends in Birmingham and Shelby County can be a little like walking into the fog: You can see a certain distance in front of you, but after that, knowing what’s ahead gets tricky.
That’s not to say we’re in a fog about what will happen, market-wise, during 2012. In fact, Colleen and I are optimistic that a lot of people will be buying and selling homes during ’12.
We think it’s going to be a busy and successful year.
Our optimism about ’12 is due in part to 2011, a year that was not only productive for us, but outperformed previous years.
For a lot of people in the Birmingham area, 2011 was a very difficult year, with the April 27th tornado affecting so many thousands of people and Jefferson County declaring the largest municipal bankruptcy in history.
I believe the new year will be one of healing and stories of success.
If You’re Buying:
2012 will be a year of excellent opportunity.
You might have to spend a little more time picking and choosing than during previous years, because inventory in some areas has dropped. This doesn’t mean the good deals are gone. It just means you’ll have to do a little more work to find them. An Agent with a good knowledge of the market as well as sharp negotiating skills will be one of your most valuable assets during this time.
Pricing will continue to be very much in your favor, but if you’re in search of a “steal,” you stand a greater chance of a Seller saying, “no deal.” If inventory continues to drop, Sellers have less competition, and therefore less reason for agreeing to a “fire sale” Offer.
The Buyer who understands and accepts this still stands to get a very good deal.
With no sharp rise in mortgage interest rates on the horizon, ’12 is shaping up to be another year of tremendously low borrowing costs.
If You’re Selling:
You will be in a better position to get your home sold than in some previous years. Home values will continue to be a big challenge, but the news isn’t all bad. With the number of homes for sale dropping in some areas, what has been very much a Buyer’s Market shows signs of changing. That’s a good thing, but the change is going to be gradual.
During ’11, we saw many homes sell for the same price they sold for ten years earlier. This was great for the Buyer, but not for the Seller. Seeing both Buyer and Seller bring checks to the closing table was not uncommon last year.
If you plan to sell during ’12, understanding one “fact of life” about the Birmingham and Shelby Co. real estate market will help: The maximum a Buyer thinks your home is worth may wind up being significantly less than you had anticipated.
We do feel optimistic that the slide in values is beginning to ease. This easing, however, is likely to be so slow and so slight that many people selling in 2012 may not feel it’s very noticeable. It’s important to remember, though, that the slide in home values didn’t happen in a few weeks or months, but rather, took years. Any correction won’t happen fast, either.
And then there’s the matter of your home’s condition. Do you want your home to appeal to a majority of possible Buyers or only a few? In the Birmingham and Shelby Co. area, the overwhelming majority of Buyers we work with want homes that are immaculate, need nothing done, and are “move-in” ready. We do get calls from Buyers looking for places to fix up, but they expect to pay “bottom dollar” for the work they know they’ll have to do.
Price wise, this home was nowhere near our biggest sale. But it’s not about the money.
The Seller had tried to sell five times before, starting three years ago, and not had success.
This was a sizable home in extremely nice, clean condition. But the sales price had never been in alignment with what was taking place in the Shelby Co. market, and we didn’t feel that the property had been marketed correctly.
Lowering the price was not easy for the Seller to do. But we worked hard in marketing the property, and our Seller worked hard, too, cooperating closely with us as we moved toward our common goal.
That team work finally paid off with a successful closing.
It pays to be a student of the market. Many of the sales Colleen and I helped with here in the Birmingham area offer lessons to the wise if you’re thinking of selling during ’12.
A 2011 Low Point:
We had many successful sales last year. But one home we listed in No. Shelby Co. was not destined to be one of them. It stayed on market for five months and never received an Offer. The home was not priced correctly, drew very little interest, and had significant structural issues cited by many of the few Buyers who actually looked inside.
During one phone call, the Seller (who had moved out but was still making monthly payments) says, “I really need to sell this house.” Only seconds later—during the same conversation, as we discuss pricing—he says, “I’m not giving my house away.”
The Seller’s viewpoint could be summed up in five words: Take it or leave it.
Buyers gave their answer.
The experiences from both our High Point and Low Point provide clear support for a prediction we’ll make for the year, though it’s not the boldest call I could make: 2012 will show that price and condition have never been more important in getting your home sold.
Changes To The Dictionary:
As we kick off ’12, I’m also deciding that it’s time to change the definition of some of the terms real estate Agents use (hmmm … am I allowed to do that?).
Agents have long referred to motivated and unmotivated Sellers. These categories don’t exist any longer. A Seller who is determined to do what it takes to get their home sold is, by definition, motivated. They will adjust their price as needed and will make sure their home is immaculate (as so many folks we worked with did last year). These are the people who, in all likelihood, will get to sit at a closing table.
The unmotivated Seller is typically unwilling to price attractively enough to receive an Offer. They also choose not to deal with with the moldy smell in the basement or the rotted wood that needs to be replaced. This person is not a Seller. They are a home owner. If they do happen to receive an Offer, it is likely to be for an extremely low price.
This year will be another time of great opportunity in real estate. If you’re giving thought to buying or selling a home, you no doubt have questions. Whether you’re a veteran or just starting out, Colleen and I hope you will feel welcome to contact us for assistance.
Feel free to call us at 205.356.5412 or 205.677.8686. Or e-mail us at: firstname.lastname@example.org
And we’re on Facebook, if you’d like to join us.
As for walking through the fog, I look forward to it. What might be ahead may not always be known, but if you’re determined to keep moving, the scene gets clearer as you forge onward.
Our optimism and positive thinking have us excited … we know there are lots of opportunities ahead.
We look forward to being part of your 2012 success story…
Thinking of selling your home?
You already know there’s plenty of competition here in the Birmingham and Shelby Co. area.
But now, there’s a new force to deal with. Check out our video just below. This all started when we decided to pay a visit to a recently listed Foreclosure in Alabaster’s Lake Forest; you may be interested to see what’s happening inside…
We’re ready to help you with getting your home sold, successfully, and sooner, rather than later.
Give us a call at 205.677.8696…
Real estate Agents are always preaching the virtues of pricing correctly for the market. Recently, we’ve seen a good example of the role pricing plays in determining how long it takes a home to sell.
Lake Forest, considered one of the Alabaster area’s nicest communities, is a good case for showing that Buyers are still around (despite suggestions you may hear to the contrary).
Like just about every other community you can think of in the Birmingham and Shelby Co. area, Lake Forest has seen its share of distressed properties (either already in Foreclosure or already facing it).
The owner of the home at 144 Red Bay Dr put the property up for sale in June, 2008, asking $297,000. The home didn’t sell, and was Foreclosed in October, 2010.
When the property came back on the market after being Foreclosed, it was listed at $224,900. Despite the new price, Buyers still weren’t interested. It took cutting the home’s price even further—down to $189,900—to get a Contract (the actual selling price won’t be known until after the sale closes).
Does this mean all Sellers have to cut their home’s price by more than $100,000? Absolutely not. But it does show that—in the current market—Sellers have some major decisions to make when it comes to putting their home up for sale.
The biggest decision every Seller will make is whether or not they are willing to meet the Buyer on the Buyer’s terms. That may sound very fundamental, but there are still a lot of Sellers around who allow their pricing decisions to be affected by:
Emotions and beliefs like these are not your friend when it comes to getting your home sold.
Your real friend toward getting a successful sale is the willingness to price your property low enough that potential Buyers will express interest soon after your home has gone on the market. This is not something many Sellers are anxious to do, given recent drops in home values. But those who do also typically realize another key fact about the current market: After they’ve sold their home and become Buyers again, the same market will be very much working in their favor, thanks to a large supply of properties available, as well as continuing low interest rates for financing. Buyers are getting some awesome deals these days.
Buyer interest is one of the most valuable keys to knowing whether a home is likely to sell sooner, rather than later, or at all. If your home is priced attractively, you’ll know it by the amount of calls and showing requests you receive. If your home gets plenty of showings but no Offers, this is another important factor, suggesting that the price is still not where Buyers feel comfortable.
If your home is on the market but the phone never rings, the silence should be deafening. It means Buyers are looking the other way, finding other properties they consider more attractive.
Recent conversations we’ve had with several homeowners about selling their homes remind me of a fact I consider important to remember:
We may be in the age of unprecedented access to information, but there’s still a lot of misinformation out there.
Cases in point are Sellers we’ve talked with in Alabaster and Hoover.
Both have tried to sell their homes, both properties are in popular neighborhoods, but neither home sold; in fact, neither couple even got an Offer. One of the homes has been on the market twice.
According to both Sellers, the reason is pretty obvious. “Everybody knows nothing is selling,” one said, while the other told me,
“There just aren’t any Buyers.” To back that up, one of the Sellers points to a home directly across the street from hers that has
been on the market since November, 2008. Within only a few blocks of this setting are at least four more homes that never sold,
I have to admit that I can’t blame these folks for thinking there are no Buyers out there. After all, the sight of real estate signs swinging in the breeze for long periods of time is pretty convincing visual proof for them.
But when you watch the market day in and day out, a different picture emerges.
With almost 1200 homes having sold across Shelby Co. since April, it’s a bit of a stretch to say there are simply no Buyers. The truth is that those Buyers are going after the best deals they find.
The real reason most homes fail to sell is because they’re overpriced. We see proof of this all the time, both in properties that draw little interest from Buyers, and others that draw almost immediate interest after going on the market.
Generally speaking, the current market is not one for putting your home up for sale to simply test the waters or “just see if it will sell.” Sellers with this perspective face slim chances at best of even getting an Offer.
The homeowner who is motivated to sell, and who is willing to meet Buyers on their price terms is the Seller who is far more likely to be successful.
If Sellers sometimes have an unrealistic idea of what a Buyer is willing to pay, Tom Horn brings them back to reality.
Tom is an appraiser in the Birmingham and Shelby Co. area, and owns appraisal-source.com, a company Lenders and homeowners trying to sell on their own rely upon for accurate residential market appraisals.
Colleen and I caught up with Tom and got his analysis of what’s happening with home values in the Shelby Co. and Birmingham areas. We found out pretty quickly that talking with Tom is very interesting!
From everything we learned about home price trends in the area, as well as the negative effects on home sales prices caused by government-mandated changes in the way appraisers are selected, we knew we needed Tom to share his expertise with us.
We’ve divided our interview with Tom into two segments. Click the players just below to listen to Parts 1 and 2.
Tom Horn Interview Part 1:
Tom Horn Interview Part 2:
…or, if you’d like to listen by downloading to your portable device:
Links to Thomas Horn’s websites:
We hope you enjoy … and thanks, Tom, for the great information!
If you’ve been thinking about buying a home in the Birmingham or Shelby county area, be aware: the clock is ticking…
The government’s Tax Credit for first time (and many existing) Buyers ends April 30th.
Under current rules, that’s the last day you can have a Contract to buy a home in place and still be eligible for the credit.
Have you been ‘on the fence’ about buying?
Here are some of the reasons proving why buying now is such a good idea:
Whether you’re buying an existing home or want to buy a brand new home, we are seeing some excellent opportunities to own a home in just about all areas in Shelby County.
In a number of cases, we are seeing such attractive pricing that—provided you meet certain Lender qualifications—you could own your own home, instead of paying rent.
So, if you’re planning on staying awhile, it doesn’t make sense to rent when you could own your own home.
Since buying a home can easily take 30 to 45 days or longer, and since the Tax Credit is set to expire in about two months, it’s time to jump off the fence!
Colleen and I are always available to help with your search and with any questions you have…
After taking a look at new numbers from the Birmingham MLS, it’s clear that Buyers have the upper hand when it comes to purchasing a home in the area.
Almost all across the board in the areas we checked, sales in January were down, and in some cases, half of what they were four months ago:
The message for now is clear: Buyers call the shots.
If you’re looking to buy, all sorts of factors are on your side at the moment. First, there are lots of homes available (482 in Helena and Pelham, 350 in Alabaster and 684 across the North Shelby Co. area at the moment!). Second, smart Sellers know they have competition and will do whatever they can to ‘work a deal.’
Third, interest rates are, in two words, still great. One of the Lenders we work with reports 30-year fixed rates remain below five percent, while 15-year rates (which were around 4.375% last week) have dropped a bit more.
So, if you’re a Seller, the message here is that you absolutely must meet Buyer’s expectations in terms of how nicely your home shows, and price. Fail to meet either of those requirements, and your home won’t sell.
And if you’re a Buyer, with such a good market for buying a home, one question comes to mind:
What are you waiting for?
Ever wished for a crystal ball so you’d know what’s ahead? That might, or might not, be a good thing, depending on what you want to know…!
On the one hand, having a crystal ball to look into the real estate market could sure help ease concerns for some folks here in the Birmingham and Shelby county areas. Or would it?
Suppose you’re thinking of selling your home. Would you be more inclined to sell sooner, if, say, the ball suggested values would continue to slide in 2010? What if the ball suggested you’d get more if you wait?
I don’t think we really need a crystal ball to know that home values will rise. Nearly every expert out there predicts they will, at some point.
It’s those last three words that are the kicker: At some point.
Hmm. Does that mean in the next three months? Ten months? Two years? This is where having a crystal ball would be pretty handy.
However, crystal balls are about as plentiful as bumper stickers in Alabama supporting the Texas Longhorns. People ask us questions frequently that would pretty much need a crystal ball to answer accurately. “What is my home going to be worth in a year?” would be one such question.
“What will my home sell for if I list it right now?”
Ahh. There’s a question that doesn’t need a crystal ball as badly to answer. We have good resources we can draw upon to come up with a figure that—more times than not—winds up being very close to actual selling price.
The fact is that if your home ‘shows nicely’ as Agents like to say, and is priced where we know Buyers will bite, your odds of selling are promising. And, yes, that’s true even in the tough market affecting so many neighborhoods in the Birmingham and Shelby Co. areas as we plow into 2010.
This might sound ridiculously obvious to some, but the ‘shows nicely, priced right’ concept is one we’ve seen trip up a lot of people trying to sell their homes. So, not everyone really understands how important this really is. Or put another way, not everyone really ‘gets it.’
During 2009, we represented Sellers who agreed to price their homes where we suggested. Granted, they weren’t always thrilled with the price we recommended. But they swallowed hard and said, ‘okay.’ Why? Because they needed to sell. Helping ease this frustration was their knowledge that—when they turned around to buy another home—they’d be enjoying the opposite side of the tough selling market, getting a very good deal on the home they’re buying.
We also dealt with Sellers in 2009 who disagreed with us. They felt they had a better idea than we did of what their home would would sell for. And guess what happened with their efforts to sell? Nothing. Zilch. Their homes didn’t sell, despite being on the market plenty long enough to sell. I remember several cases where other homes in the same neighborhood as our Clients’ house sold, and in the general price range we had recommended.
There were some cases where our Client’s home never even got an Offer. We always talk about how important it is to listen to what the market is telling us. Let me assure you of one thing: If a home for sale doesn’t even get an Offer, that’s the market talking. It may even be shouting.
I know one thing for sure about trying to get a home sold in this market. You either have to ‘get it,’ or you have to trust your Agent’s advice. Otherwise, your home is probably not destined to sell.
I think the real question that emerges is: How badly do you want, or need, to sell?
Clearly, there are many situations for folks where—regardless of how the market may be performing at the moment—it’s important to sell sooner, rather than later. Some Sellers who contact us tell us they need to sell as fast as possible, and are waiting for us to tell them what to do to make it so.
These are the people we feel confident we can help.
And no, we don’t have a crystal ball to predict the outcome.
But listening to the market and to your Agent go a long way right now, and will most likely mean you can start packing sooner, rather than later.
You can have fun and help people at the same time.
That’s what the Oak Mountain Real Estate Network’s annual Christmas Auction, held November 18th in Pelham, is all about:
Despite a tough economy, we had a lot of Agents and people working in affiliated fields participate. When it was all over, the Network had raised nearly $2,200. The Network supports two very worthy causes here in Shelby County: SafeHouse and Family Connection.