Happy Monday, February 12, 2018
I hope you all had a great weekend. Let’s start the week by reviewing how home sales are going so far this year in New Tampa, one of Tampa’s most popular home buying areas.
In January of 2018, 19 fewer single-family homes sold compared to January 2017. In January 2018, 51 homes sold that was 27% less than in 2017 when 70 home sold in January. The number of homes for sale also fell the 27% from 435 (January 2017) to 317 (January 2018). The number of New Properties listed for sale also dropped from 109 in the first month of 2017 to 97 the first month of this year, an 11% decrease. These trends suggest that the decline in sales is directly related to fewer homes being listed for sale. As I’ve said before the biggest factor affecting sales is not pricing or buyer demand, but the lack of homes for sale.
This becomes clearer if you look at Months Supply of Inventory. This measure also plummetted 38% compared to January 2017. Last January, the New Tampa market had 4.3 months of supply, but this January inventory levels had fallen to 2.7 months. The Average Days a Home Stayed on the Market dropped 28%. In 2017, homes stayed on the market an average of 86 days, but this January it was down to 63 days. This means homes sold 28% faster, on average than last January.
Median Sold Price, which shows the price half the homes sold for, rose 4% — from $286,250 in January 2017 to $297,000 in January 2018. The Median For Sale Price of homes jumped 8% or $27,500. In January of 2017, the median for sale price stood at $325,000 and in January 2018 it was $352,5000.
The primary thing holding back home sales is too few homes for sale — not buyer demand or high prices. So this means you have a great shot at finding a buyer if you list now rather than later. Plus if you do so now, you will attract attention when the marketplace is less crowded. Once Spring rolls around, you’ll face more competition as many sellers start listing at that time.
Here’s some useful and interesting information we’ve run across this week. There’s something for everyone so be sure to check it out.
At 2.6 million square feet, the new rental car center at Tampa International Airport is big — bigger, even, than International Plaza.
And it is just one of three airport projects scheduled to open to the public on Feb. 14. There’s a 1.4-mile-long SkyConnect people mover (dubbed the #LoveTrain, since it will debut on Valentine’s Day). And the main terminal will be emerging from three years of heavy construction.
In all, it’s $971 million worth of work to de-congest the main terminal. Future phases of the expansion are aimed at creating an airport capable of handling 34 million passengers — compared to 19.6 million last year — within the current footprint.
“It’s critical that we keep this airport up to date and support this kind of growth for the next 20 to 30 years,” Hillsborough County Aviation Authority chair Robert Watkins said Wednesday during a sneak peek of the new construction.
From the Blog:
Buyers in the market during the winter months are truly motivated purchasers. They want to buy now. With limited inventory currently available in most markets, sellers are in a great position to negotiate.
How Will This Impact Your Mortgage Payment?
Depending on the amount of the loan that you secure, a half of a percent (.5%) increase in interest rate can increase your monthly mortgage payment significantly.
According to CoreLogic’s latest Home Price Index, national home prices have appreciated 7.0% from this time last year and are predicted to be 4.2% higher next year.
If both the predictions of home price and interest rate increases become reality, families would wind up paying considerably more for their next home.
Even a small increase in interest rate can impact your family’s wealth. Let’s get together to evaluate your ability to purchase your dream home.
Buying a home involves its own language. Here’s a guide to the terms you may encounter.
1 BD/1 BA — One bedroom, one bathroom
DR — Dining room
FP — Fireplace
FB — Full bathroom. A bathroom with a toilet, sink and shower and/or bathtub.
HB — Half bathroom. A bathroom with only a toilet and sink. Also known as a powder room.
LR — Living room
W/D — Washer dryer
Active — A property that is on the market and available for sale. It may have received offers but none have been accepted.
ARM — Adjustable-Rate Mortgage. A mortgage loan with a fluctuating interest rate.
APR — Annual Percentage Rate. APR is a broader measure of the cost of borrowing money. It reflects not only the interest rate but also points, fees and other charges paid to obtain a loan.
Appraisal — An estimate of the market value of a property based on comparable recent sales of homes nearby. It is done by a licensed appraiser for a lender.
Arms-length transaction — Both parties to a transaction are acting in their own self-interest. Neither party is pressured by or acts in connection with the other to assure the fair market value of the property.
Assessment — An estimate of the home’s value for property tax purposes.
Closing costs — The expenses and fees associated with the purchase and sale of a home, such as taxes, title insurance, appraisal fees and lender fees.
Closing Disclosure — A final statement of loan terms and closing costs. The buyer must receive it three business days before closing. Replaced the old HUD-1 form.
Commission — A fee charged by a real estate agent for his services. In many cases, the seller pays the commission to his agent as well as the buyer’s agent.
Contingency — A condition that must be met before a sale can close. Common contingencies include home inspection, financing and home appraisal.
DTI — Debt-to-Income. The total percent of a borrower’s income that is paid toward debt each month calculated as a ratio of a borrower’s gross monthly income over his debts including car payments, student loans and credit card bills. A borrower’s DTI affects his credit rating.
Deed — A legal document filed with the county that records homeownership.
Down payment — The amount of money a buyer pays at closing toward a home purchase.
Earnest money deposit — A partial payment by a buyer when submitting a contract that demonstrates the buyer’s commitment to the deal. The money, which is held in an escrow account, goes toward closing costs.
Equity — The amount remaining after subtracting the amount of a mortgage loan from the sales price of the home.
Escalation clause — A tool used by buyers to outbid competitors for a property. In the contract offer submitted by the buyer to the seller, the buyer states he will increase his offer by a certain amount if the seller receives offers higher than his.
Escrow — A neutral or third party who handles the exchange of money and documents on behalf of two other parties before the closing of a sale.
Fixed-rate mortgage — A mortgage loan with an interest rate that won’t change during the length of the loan.
FSBO — For Sale By Owner. The owner of the property is selling without a real estate agent.
Listing — Property for sale that is listed on the multiple listing service. A FSBO is not a listing.
LTV — Loan-to-Value. The ratio of the amount of money borrowed over the appraised value of the home. It is a key risk factor that lenders consider when evaluating a loan application.
MLS — Multiple Listing Service. A local or regional real estate service that compiles available properties for sale submitted by real estate brokers and agents. An MLS can only be accessed by real estate brokers and agents.
Pending — An offer has been accepted, a contract has been executed and the contingencies have been met.
Points — A one-time fee paid to a lender equal to 1 percent of the loan amount to reduce the interest rate.
Preapproved — A buyer completes an application, pays a fee and supplies the necessary documentation to the lender who performs an extensive financial background check. The lender will issue a conditional commitment in writing for an exact loan amount. Preapproval does not guarantee a loan.
Prequalified — An informal estimate of how much a buyer can afford to borrow for a mortgage. It does not include an analysis of a buyer’s credit report or an in-depth look at his ability to purchase a home.
PITI — Principal, Interest, Taxes and Insurance. The major homeownership costs included in many monthly mortgage payments.
PMI — Private Mortgage Insurance. Insurance that protects a lender against loss if a borrower defaults on a loan. PMI is required for conventional loans that have less than a 20 percent down payment.
Rate lock — An agreement between a borrower and a lender that allows the borrower to lock in an interest rate on a mortgage for a specified period of time.
Title insurance — Compensates the buyer or lender if title defects, liens or competing claims of ownership on a property arise after closing.
Under contract — A seller has accepted the buyer’s offer but any contingencies have yet to be met.
While homebuyers are as individual as the homes they plan on purchasing, one thing they share is a desire to ensure that the home they will call their own is as good beneath the surface as it appears to be. Will the roof end up leaking? Is the wiring safe? What about the plumbing? These, and others, are the questions that the buyers looking at your home will seek professional help to answer.
According to industry experts, there are at least 33 physical problems that will come under scrutiny during a home inspection. We’ve identified the 10 most common of these and, if not identified and dealt with, any of these 10 items could cost you dearly in terms of repair. In most cases, you can make a reasonable pre-inspection yourself if you know what you’re looking for. And knowing what you’re looking for can help you prevent little problems from growing into costly and unmanageable ones.
The U.S. weekly average 30-year fixed mortgage rate rocketed up 10 basis points to 4.32 percent this week. Following a turbulent Monday, financial markets settled down with the 10-year Treasury yield resuming its upward march. Mortgage rates have followed. The 30-year fixed mortgage rate is up 33 basis points since the start of the year. Will higher rates break housing market momentum? It’s too early to tell for sure, but initial readings indicate housing markets are sustaining their momentum so far. The MBA reported that purchase applications are up 8 percent from a year ago in their latest Weekly Mortgage Applications Survey.
Have a Fantastic Week!
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Thanks for taking time to read the Tampa Market Monthly! If you want to buy or sell a home or find out your home’s value please let us know. We’d love to work with you. You can reach me, Doug Bohannon or Dale Bohannon at 813-979-4963 or by completing this contact form. You can search all Tampa area homes for sale at www.teambohannon.com.
Have a Fantastic week!