Stealing My Stuff!
Copy for Real Estate Guide Column for 1-27-06 (459 words)REAL ESTATE PATTERNSBy Ken DuVall STEALING MY STUFF!The February issue of “Money” magazine’s cover article is titled, “Why the Sky Isn’t Falling.” A sub-headline says: “The Chicken Little’s have it all wrong- and there’s money to be made betting against them.” The Judgment Day guys say: “We’re all doomed… we’re on the edge of a recession… inflation could flare up and crush your purchasing power…” etc. I used this same material months ago in a previous column, but I don’t plan a plagiarism suit as I’m certain their editors don’t read this column!! These are some of their observations along with mine. In our collective opinion, the dark clouds guys are way wrong. THINKING OF SELLING?Go ahead. If you want to move in the next year or two, consider selling sooner rather than later. Obviously, don’t cut and run in a panic. And your Realtor must price it right. Just because your neighbor sold for a high price 6 months ago doesn’t mean yours can fetch a premium price now. There’s a lot more competition. You need to make yours look like a bargain. Undervalued properties tend to get pushed up by market forces. Sellers not in a hurry can hold out for a long time.THINKING OF BUYING?Go ahead. Whether the market is up, down, or sideways shouldn’t be your deciding factor. Your new home is just another consumer durable like a fridge. It really doesn’t matter whether the price is going up or down. Think about the service it’ll give you while you own it. Not to mention the tax write-offs. Even if prices plummet, not likely, you won’t get hurt as long as you can make your payments. Be sure to get the proper value from your Realtor.LESLIE SPEAKSLeslie Appleton-Young, the California Assn. of Realtors Chief Economist is calling our housing market the “Goldilocks economy, not too hot, not too cold.” I love it. Gag: what do you call a salmon crossed with a gold fish? Goldie lox, of course! All Realtors admire and respect her knowledge and foresight. Her 2006 forecast, delivered last week at the new Trump Nat’l Golf Course in Rancho Palos Verdes down south, confirmed what others have been saying: “Our market is on course for a soft-landing, not a bubble waiting to burst. There is a bubble- a bubble in the number of articles about a housing bubble! The state’s median price is expected to rise 10% this year to $573,500. We’re expecting a shakeout in the industry in the next few years. There just aren’t enough homes to sell in California.” Interestingly enough, there are about 187,000 Realtors (1.2 mil in the U.S.) in California. That’s about one Realtor for every 190 residents. Meanwhile, lawyers total around 192,000. Who would have believed it?Ken owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at http://www.kenduvall.com/ and call Ken at 345-3700 for all your real estate needs. Free consulting.
Listening to the Experts
Copy for Real Estate Guide Column for 1-20-06 (470 words)REAL ESTATE PATTERNSBy Ken DuVall LISTENING TO THE EXPERTSIt’s been a slow news week, so let’s hear what Mark Anson, Chief Investment Officer for the giant California Public Employees’ Retirement System (CalPERS) said in the Sac Bee. CalPERS has $200 billion in pension assets for 1.4 million members. Anson is credited with boosting their fund value by $70 billion over the last 3 years. Profiting in part from big payoffs in real estate, CalPERS closed out 2005 with an 11.2% investment return. Says Mark, “We did not want to run with the pack and be conservative and sit on our hands. We began to take more risk in real estate. We simply weren’t as scared as other people. Four years ago our real estate portfolio had less than 4% invested … it’s now up to 20% and growing. Everyone has talked about the housing bubble, but we’ve yet to see it burst… Real estate was our strongest performer. I think we still have room for the housing market to grow… the U.S. economy is still robust… growing a little stronger than most people think.” The venerable Kiplinger Letter, published since 1923, said last week: “Jitters about a softer housing market are unfounded. Sentiment will improve by spring as the peak home-buying season offers proof that housing is slowing, not collapsing. And the Fed will end their rate hikes, relieving the upward pressure on short-term rates.” Long term loan rates are trending downward again. Many of us just got a little nervous there for awhile. We’re starting to settle down now. As prices increase and affordability falls (only 14% -vs. 50% nationwide- of the state population can buy our $548K median priced home) fully 25% of all home loans in California now have 40-year terms. Fifty-year, and even 60-year loans, both on the horizon, would lower monthly payments so more borrowers can qualify.SIGN OF THE TIMESIncluding the entire Bay Area and extending to the Central Valley, a huge group of Realtors have agreed to combine into one giant MLS. It will be the State's largest and the 2nd largest in the country. Encompassing 6 major Realtor’s Associations representing 46,000 agents in 11 counties, all their listings will be merged into a single MLS system. So from Monterey to Merced, you’ll be able to pull up any listing from one central database. The program, under discussion for over a year, is expected to be online sometime in 2007. It’s a whole lot easier to all be against something than to all be in favor of it. Nice going, guys and gals. It took us many years to do the same thing here with our recently combined Chico, Paradise, Oroville, etc., MLS databases. As a result, go on any website like mine and you can now pull up most listings in the North State. High tech is boss anymoreKen owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at www.KenDuVall.com and call Ken at 345-3700 for all your real estate needs. Free consulting.
NO DOOM & GLOOM FOR 2006
Copy for Real Estate Guide Column for 1-13-06 (483 words)REAL ESTATE PATTERNSBy Ken DuVall NO DOOM & GLOOM FOR 2006Following 5 years of strong growth which created $5 trillion in new wealth, and another record year on track for 2005, home sales and housing production figure to ease back to healthier levels this year. From all reports, we’re headed for a good economy through 2006, with tame inflation, GDP and job growth at roughly the same pace as 2005, all key factors for real estate. Consumer confidence is on the rise again. Housing should see a simmering down to a sustainable level of sales, home production, and price appreciation, as opposed to a full-blown cyclical contraction. Typically, home prices grow at least 1 to 2% higher than inflation, now pegged at about 3% for ’06. Most experts are predicting an average 10%+ gain for California this year, higher in the most desirable areas. I’ll go along with that. A nationwide poll of investors reveals the real estate industry is surpassed only by energy as America’s leading investment opportunity.Listings will continue to remain on the market longer as we shift to a balanced market between buyers and sellers. Interest rates won’t go crazy, people will stay in their houses longer, and the continuing shortage of housing will prevent prices from dropping steeply. Versus multiple offers, Chico is now seeing some asking price reductions; however homes are still selling close to list price. It looks like a case of returning to market fundamentals, not a bubble deflating. We’ve had an incredible charmed run for 5 years, THE all-time real estate boom. In my judgment the projection for 2006 appears to be a modest cooling, back to our normal growth pattern, but without “steroids”. The top experts say sales in 2006 are expected to be merely the 3rd best on record. We should be able to live with that. California, with our 36 million residents, accounts for 12% of America’s population. The State median home price is now $548,400. In Chico we’re returning to the traditional market we’re used to seeing over my 28 years here. There were some 300+ active home listings worth $137 mil as of last week, which is about what we always used to have on hand over the decades. Last spring we were lucky to have 120 listings! The median list price is now $359,000, with an average 77 days on the market to sell. That’s more normal, but for the prices. In 2004, 1230 Chico homes sold worth $376 mil, median price $277,000, 87 days on market. In 2005, 1116 homes sold worth $393 mil, median $325,000, 53 days on market, representing an annual price gain of 17%. Remember: Real Estate is not a get rich quick scheme. Rather, it is a get rich slow equation based on ownership over the years. You take care of the property and the equity takes care of you in the long run. Let’s all have a Great Year! Keep the Faith.Ken owns Ken DuVall & Associates, Realtors at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings at www.KenDuVall.com and call Ken at 345-3700 for all your real estate needs. Free consulting.
