Coffey Thoughts

There was  an article on my board website that I wanted to let everyone know about(http://www.columbusrealtors.com/NewsDetail.aspx?article=526) regarding a market report by Clear Capital Home Data Index that identified Columbus, OH among the top 10 cities in the nation that are poised to see an increase in home values this year. This article was also posted on MSNBC.com. They actually show Columbus, OH ranked 5th nationally. Based on their Index they expect Columbus, OH to see a 2.1% increase in home values this year. There was also a study last year in Forbes Magazine that stated Columbus, OH is 3rd nationally in stability.

 I am sure there are many other studies out there, but essentially the question we must ask is, “Have we now seen the bottom?”. Personally I am told there is a huge back log of foreclosed properties that banks haven’t released to the market yet.   Obviously that will have a large impact on future values depending on how swift they release them. However all in all this sounds like great news for Central Ohio.

Speaking of Central Ohio, here is also a link to our monthly Columbus Board Home Sale Statistics (http://10kresearch.com/sortable/Columbus-OH/Main.htm). This list is comprehensive and include individual break out statistics for all Central Ohio Counties and Communities. Anyone that wants this information e-mailed to them monthly can simply e-mail me at kevincoffey@kw.com,    give me a call at (614) 260-5965 or visit my website at www.CoffeyTeam.com.

This date shows that Central Ohio was very stable. In fact for the entire MLS there was a 0.3% increase in average sales price. Delaware County showed a 6.7% decrease and  Franklin showed a 0.06% decrease. However Union showed a 12.3% increase and Pickaway showed a whopping 26.2% increase. As we realtors always try to preach, real estate is a local market. These stats prove that.

Please feel free to contact me with any questions or thoughts.

Well it’s official, Penn National has officially selected the closed Delphi plant on the Westside of Columbus as the location that they are going to build their “Hollywood Style” casino. I have spoken with many people here and have heard a mixed bag of feelings. Some believe that with a casino in town it will suck up all the money that would have been spent on nearby retailers. In my personal opinion I do agree that casino’s are made to get people in the door and  intice them to stay until their last dollar is spent. However I disagree that a casino will suck up all the money from nearby retailers. I believe what a lot of people are failing to realize is that the casino will become a destination for not only many people in Central Ohio, but perhaps many people all over Ohio. This means dollars will pour in to the area from all over Columbus as well as many parts of Ohio that otherwise wouldn’t have been there in the first place.  as an example,  instead of a group of friends that were going to go out on the town in The Arena District, they may first start the night off at the casino, before heading to a new local night spot and then spend the night in one of the newly built hotels nearby. Then they wake up bright and early to grab some breakfast before heading home. It’s feasible to believe  a group of 4 friends would have just spent anywhere from $400 – $800 on this night depending on how well they did at the casino. There will be those rare instances where someone wins big and stops off next door and decides to pay cash for a new car at our local car dealership. I could probably go out about this for awhile, but I’m hoping I made a little bit of a point here. This money would have never made it to the West Side of Columbus without the casino. Once the money starts pouring in, it will literally revitalize a great portion of the area and bring life back in to the West Broad corridor.

In addition to the money being brought in to the area, much of it will go back out in the form of salaries to employees many of which may live within walking distance. These same employees will shop at nearby grocery stores, eat at nearby restaurants and may even entertain themselves by heading to the newly restored Westland Mall. Hopefully for my sake many of them will want to buy a house or condo. For me personally my imagination grabs  a hold  of me, but I do see this being a great thing for the future of The Westside.

I realize this is slightly a controversial subject and there can be an argument that gambling tears apart families and causes people to lose their homes. For that I can only hope there is a lot of effort put forth by our city leaders and Penn National as well to help counsel those with an addiction. But truth be told many gamblers that suffer from the addiction have probably already found they can gamble online, head 10 minutes South to Buelah Park to bet on horses or drive just 2 hours to the riverboats in Cincy. So at least this will help keep the money local.

Well that’s my thoughts on the matter. I can only hope this turns out to be half as much as I imagine, but we shall soon find out.  We still  need the  constitution changed  to reflect the new location and then demolition, cleanup and then construction all within 2.5 years.

If anyone else has an opinion on this, I would like to hear it.

Well it’s been a busy Summer. So much so that this is my first post in months. The market has been fueled by the rediculously low interest rates which have dipped below 5% once or twice and of course this $8,000 tax credit has kept the stream of first time home buyers coming.

 The issue I have is with a discussion I just had with a first time home buyer over the phone. (Hopefully they don’t read this!). I can’t believe that some first time home buyers don’t understand how little time is left to take advantage of this credit. First for those of you that don’t understand what this credit means, let me  explain. This $8,000 credit is a direct refund meaning if you normally get a $500 refund, next year you will get an $8,500 refund. If you normally owe $5000 in taxes, then you will only get a $3,000 refund. Think of what you can do to the house to fix it up with this kind of money. Or maybe you use the money to pay off debt? Maybe invest it in something. Either way it is $8,000 cold hard cash. So come get it.

 Now here is the larger problem however; The market is busy right now and due to the slow sales we’ve had for the past 12 months and recent changes to underwriting laws, we are low on appraisers and underwriters. So now they can’t keep up. What used to take 2 – 3 weeks to appraise and underwrite is taking 4 – 5 weeks and it’s only going to get worse in the months of October & November. So my best guess is that you better be in contract on something by the end of September to guarantee you get it done.

However that brings me to my next issue; The best deals out there are bank owned or short sales which take even longer. So if you really want to be safe, you should really be in contract on something no later than the end of August. So basically this means you have 3 weeks to find the good deals on distressed properties. Otherwise you are going to have to pick from normal non motivated home sellers who will try to get top dollar for their home.

So if you are ready to purchase, now is the best time. Right now! August 2009. If you are one of those buyers that finally understand that you can’t waste another day, then please call me immediately on my mobile at (614) 260-5965.

Otherwise, Happy Home Hunting and I look forward to any comments!

Kevin Coffey

If anyone has been paying real close attention lately, you most likely noticed that The Columbus Board of Realtors has starting running a new advertising campaign to get the word out to buyers that now is the time to buy. I completely agree with the campaign, but I still can’t believe it took money ($200,000 to be exact) and 7,000 realtors word of mouth along with countless individuals in the real estate related fields (i.e. mortgage, title, etc) to explain to buyers what should be common sense.

Everything I read is about how bad off the market is right now. Home prices are falling, builders housing starts are at or near record lows, the “credit crunch” has made it difficult for some buyers to purchase or some current owners to refinance and more. So based on this, both buyers and sellers are scared to do anything.

But then you hear about all the government action to assist this problem. You hear every day about how lenders are doing loan modifications to help current home owners.

So my only advise to buyers that are waiting is to look at the momentum that is being created.

• Governments and corporations are getting involved to do as much as possible to stop the foreclosure crisis. This will eventually decrease the supply of distressed homes, therefore increasing the demand for distressed homes.
• Also non-distressed home sellers have started to put off moving which also decreased the supply of available homes.
• Builders have become more strict about qualifications from buyers before they start new homes, therefore decreasing their quantity of inventory homes.
• In the meantime interest rates are stable at roughly 6% on a 30 year fixed rate loan. You can still buy a home using FHA financing with only 3% down which can be gifted by multiple sources or using OHFA bond money, you can finance the downpayment.

However what I see instead of an increased amount of owner occupant buyers,  I see investors  buying up properties because their is an increase in the amount of buyers that either can’t get financing now or they have been brainwashed into  thinking this is a bad market to  buy. So there is an increase in the amount of people wanting to rent.  It’s a  interesting  stat I read one time that out of 100 random people, only 5 will be either wealthy or comfortable financially at the age of retirement based on historical data. It stated that 4 of the 5 will have obtained their wealth through real estate.

OK well enough of my jibber jabber. You can vist the CBR “Grass is Greener” campaign at www.ColumbusHousingFacts.com. There you will find all the information you need to know.

Visit my website www.Coffeyteam.com if you would like to request more info or sign up to receive FREE listing updates on homes in your area.

Good Luck!

Kevin Coffey

IS anyone out there? I realize that I am brand new to blogging and therefore there will probably be no readers to this post. However I am finally excited to get this off the ground. The reason is that being a real estate agent I speak to so many people through out the day, week, month, year, etc and they all want to ask, “Hows the market?” Well we all know how the market is right now…”It’s unbelieveable!”

The truth is that home prices are declining, inventories are high and more homes are falling into the distressed category. This isn’t positive for home sellers. However what could be better for home buyers? Many of your most wealthy real estate investors made their money when inventory was high and home prices were declining back in the 80′s. However the difference between the 80′s and now is that interest rates are in the 6% range and not 18%.

This brings me to my next point, if many sellers are also buying and many of those sellers are moving up to a larger or more expensive home, how does this hurt them. Take the loss on the sale and make the gain on the purchase. Seems simple to me. I know everything isn’t simple, especially in these market conditions. However this is relatively simple if you fall in this category.

The fact is that there can only be  2 types of markets: 1) Sellers market – too many buyers and not enough inventory 2) Buyers Market – too much inventory and not enough buyers.  You have to view it like a teeter todder. One side goes up and the other goes down. With so many new home starts the past decade,  we had to have this correction. It was bound to happen. So now the builders  will tighten their standards and quit building houses for people that haven’t yet qualified for them which will decrease their on hand inventories  and  unfortunately put some of them out of business. Many sellers are already starting to realize they can’t sell to cover their mortgage balance. So they  will pull their homes from the market and try some time in the future. All of this, coupled with interest rates remaining low  will decrease the selection for current buyers which will level the market and stabilize the depreciation.

If anyone reads this, please give me your thoughts. Am I completely inaccurate here?

OK sorry to get off on a tangent, but I had to get that off my chest. Please look forward to me publishing more information frequently. I spend a lot of time reading local and national papers and websites, so I am full of information that I want to discuss with others.

Thanks for visiting.

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