Perrysburg Blog

The sky is a little brighter this week.

The sun has been shining more in Perrysburg.

And there are lots more accepted offers and buyer offer writing action in play.

Even though things could change.

And even though national indices are split – with sales down and values up.

It’s a confusing market.

But . . . “all real estate is local”.

So here is my take on the recent spate of action in the 43551:

Affordability

• Affordability is at its highest level in the past several decades.
• Many Perrysburg homes now cost 30-40% less than they did 6 or 7 years ago.

Pent-Up Demand

• Many of today’s buyers need to buy because their families have grown, they just moved here, they got a promotion or a raise, and other valid reasons.
• Sellers who hung on during our real estate decline have paid down debt (including mortgage debt), saved their money, and are now ready to move up.

Low Interest Rates

• Interest rates for 30-year fixed-rate mortgages remain below 4% and rates for 15-year mortgages are even less.
• Buyers are realizing that these rates are certain to rise if our national economy regains it footing.

Buyers Believe There’s Little Downside

• Buyers who were previously afraid they would lose money if they bought a home are now realizing that the risk is reduced and that they have waited long enough.
• Prices in the Perrysburg real estate market have stabilized in most segments of the market.
• The grim bloodletting in the suburbs is almost over – with values rationalized and the flight to safety of steadier values in the periphery of Toledo increasing values.

Cheaper To Own Than Rent

• It used to be cheaper to rent than own a home, but that has changed.
• Rents are soaring and now exceed the cost of home ownership in many instances.
• Given a choice, most renters would rather own their own home than pay off their landlord’s mortgage with their rent payments.

I was in Chicago last week at a technology mastermind meeting . . . . for one of the tech products that I provide and use.

It was a great meeting.   I learned a lot.  I will be making some changes based on what I learned.

One upshot:  Zillow, Trulia, Realtor.com, and other real estate technology companies are relentlessly improving.

If you use one of these applications on your iPad . . . they seem to average an app update about every 2 weeks.

When our local Board of Realtors looks at a platform change – that’s a 3 year process.

Even a software update to our current MLS is a 6 month to 12 month action item . . .

Relentless change by vendors with millions of users vs a local board with 1200 users simply cannot be competed with.

So I expect that the search tools consumers use will continue to outpace the tools used by Realtors behind closed walls.

There is also a blizzard of new and diverse applications that hit the market for smartphones every day.

There are too many to keep up with.

So when I meet up with some agents from other areas, and we talk at length while breaking bread, it invariably happens now that one will pull out an iPhone, show me an app that solved a problem or provides a better solution . . . and then in 30 seconds it is up and running on my iPhone.

In the past?  That was a trip back home.   A phone call to arrange a demo.  A CD arriving to install.  Time to test and evaluate.  Then a purchase decision with training or data conversion to follow.

Now?

Done in one minute.  I might risk $1.99 to $3.99.

The pace of change is faster.   The cost of evaluation and a mistake is miniscule.

What’s next?  My guesses:

Agents ability to predict what buyers are looking for and what they need to look at – driven by smart programming and algorithms is coming.

Total elimination of paper in the transaction is on the horizon – and I look forward to that.

Tools to help buyers predict the value of what they are looking at.

Tools and apps to help sellers rank agents or rate agents.

Tools and apps to allow better mortgage decisions, better title decisions, and better house buying decisions.

All coming soon – in a disruptive, chaotic manner.

Think back, if you can, to how you web tools changed travel, stock buying, mutual funds, and shopping for a car.

That’s the kind of technology change awaiting real estate.

One of my rare – and shameless – listing posts.

New on the market – and redone inside by the corporate owner with new paint, carpet, and appliances.

Rossford Schools in Perrysburg Township.

4 beds and 2.5 baths.   An interesting and 60% finished hidden room off of the master closet . . . retreat?  Office?  Safe house?  You decide.

$140,900 is all – and there is a “HomePath” option for any buyer:  no appraisal.  No PMI.  All closing costs can be financed also.

I was able to invite all my clients (and their children) to see a matinee showing of Puss’n Boots on Saturday.  

We had a great time and there was no popcorn left . . . and it was a really good movie.

Some photos taken by my wife . . . .

I did have to hire some auxiliary hostesses – my daughter Hannah and her friend Emily. 

Spring market.   Spring sales.  Spring new listings.   Spring open house events.

All is new in the Spring market . . .

Except if your house failed to sell in 2011.  

Why?

What happened?

Many would say:

1. It was not marketed properly.

If your last agent is/was broke and destitute and/or does not use internet marketing . . . there may be a correlation with these salient facts and your unsold home.  Just saying!

2. It was not in good condition.

Maybe no one thought to ask the buyers that looked what THEY thought.  Maybe your dog/cat/teenager scared away the traffic.  Maybe the directly competing houses blew yours away.

3. It was not a team effort. 

There should be good and effective communication between the home owner and the listing agent.   They must work together.

4. It was not properly priced.

This is the single most important factor today – price.   It beats 1,2,3 above.  It trumps everything including the price of gasoline, the time of year, and is equal to location.

Price is the KEY dynamic.

Ignore it and your home will not sell.

How should you price it?  Who should you talk to?  What comparable sales are good?  What adjustments do you use?  What repairs do you think I should do?

An open house won’t fix an incorrect price.

A new Realtor won’t fix it!

Price is absolutely critical in the Perrysburg real estate market today.

Why? What?

“REO” is of course banked owned foreclosed property.

And it’s strange how things sometimes run in streaks.

Today – I wrote an offer on very sharp 43551 REO listing.

Showed one.

Listed one.

That’s all normal . . . here is what is interesting:

1. A new RIVER ROAD REO property (30571 East River Rd.)  On the water.  That does not happen every day – in fact it’s incredibly rare.  $175k.  2500 sq. feet.  Township with Rossford Schools.  Last sold for $100k more . . .

2. A “builder’s own home” type REO listing.  We are putting new carpeting in it as I write this – with a 3 car garage, finished basement, and all the bling/bling you would expect.  $180s’ with close to 3000 sq. feet – and I think it’s worth LOTS more . . .it’s open this Sunday from 1 to 3.  507 Harrison Dr. in Shawnee Trace.  It just might be underpriced by $30k . . . at least!

It’s always good to end on a high note.

Here is a table of SOLD prices in Perrysburg, looking back 2 full years.

Even if it’s not that high.

Prices in Perrysburg for single family home sales were technically down in December 2011 vs. 2010.  But the average price was higher.

Seasonality has fully returned . . . which means lower closing numbers are in store for January, February, and March.

What about the price trends for what sellers are asking and buyers are writing accepted offers on?

Glad you asked!

Here’s your pretty chart (just click on it to read it in normal size . . . )

Remarkably steady and constant if you factor our the seasonality effects . . . Still not a normal market in Perrysburg . . . but we are getting healthier!

Since I just got back from a conference in America’s most cosmopolitan, outward looking city – New York City – where you are prone to hear German or French or Russian voices as you walk on 5th Avenue – I thought about the foreign buyer in Perrysburg.

There are a lot of them!

They come here to buy.

They come here because Perrysburg real estate is a very safe buy.

They come here because of the schools, the lifestyle, and obviously the employment.

And they buy a lot of real estate -  MSNBC.com reports that foreign buyers bought over $80 billion in US property in 2010.  That was up from $66 billion in 2009.

I have sold property in and around Perrysburg to buyers from the Ukraine, Poland, Russia, France, Great Brittan, China, Vietnam, Australia, Japan, Saudi Arabia, Syria, Egypt, Italy, and Canada (is Canada that foreign?).

What are foreign buyers looking for in Perrysburg?  The exact same thing that any buyer is -  a good deal, a great floor plan, a nice lot, and no surprises.

When many foreign buyers look at our prices and values I believe that they inwardly, secretly chuckle at how cheap our prices are and how large our lots are.

The best thing to do is look at a map – maps are my favorite tool!

Here’s one view of the flow of “Euro Buyers” into the US, courtesy of Trulia.com

One thing to think about – the three largest home sales EVER in America were all to . . .  foreign buyers.  This is one, in California.  It sold for $100,000,000.  To a Russian.

I talked to a friend of mine who knows the Russian speaking Realtor who wrote the contract for Yuri Milner, the Google/Hedge Fund type investor.  I think that he was sad – he will never, ever in all of his career close on a deal that large again.  Must be sad to realize that!

It’s too early (still 2011) to do a 2011 recap . . . or a 2011 statistical look at the numbers in the 43551 – you can be sure that those will be coming soon to this space.

But I was thinking about what was hard to do in Perrysburg real estate in 2011.  

So, I will try to “put lipstick on a pig” and share my problems with you in a positive and affirming manner!  

1. Getting or giving an accurate “quick sale value” was very hard to do in 2011.  In Perrysburg.  In Toledo.  The market was shifting and that made the guessing game of providing quick sale numbers very hard (you don’t want to know and you don’t ever want to need a “quick sale valuation” for your house!)

2. Real estate team management was hard.  My team?  Shifted.  One long time assistant retired.  One decided to, rather sensibly, take care of newborn twin boys!  And one just vanished!  New hires and new licensed team additions have made my team larger than ever.

3. Seeing people you sold a house to . . . . lose it to the bank.  Very, very hard.

4. Watch mold grow in great houses – very hard.  Sometimes the rules and regulations conspire to make a house sit in the shadow inventory of foreclosure-land.  And then bad things can happen.  It’s a dirty rotten shame.

5. Managing growth and the new market.   My team and I have never, ever sold more homes for more money.  And I have added several new lead systems.  Which has added a couple of thousand leads to manage.  Very hard.  

6. Telling buyer clients to be careful.  Just because rates are very, very low does not mean that you should spend all your income on that special house.  Not many people like to hear “no”.

7. Manage real estate deals.  Very, very hard.   Every part of every deal has changed in the past 4 years.  Financial rules.  Appraisal rules.  Valuation rules.  Stress levels are high.  Equity is low.  Jobs are under pressure if you are being transferred in or out.  When I have a “happy” closing – with neither the seller or the buyer under duress or stress or distress?  That’s actually notable today.

8. Telling the truth to sellers about the current and accurate value of their home.  Well . . . not hard.  But sometimes painful.  Or distressing.  But it has to be done.

9. Keeping up with the literature.   Never, ever been harder.  I maintain a few “professional designations” for my real estate career.  It’s a little inside industry inside real estate sales and management.  I have the ABR degree.  The CRP degree.  The CRS. The CDPE designation.  About 8 or 10 of them.  And they all take up biannual or triennial accreditation.  Plus my Ohio real estate broker’s license continuing education.  Plus the various real estate and sales and marketing books I love to read.  Too much in 2011.  For the first time ever I have not yet bought or even perused my favorite authors newest book – Seth Godin’s “We Are All Weird”

10. The iPad.  Love it.  Use it every day for real estate and reading (I did get tired of my dear wife hinting at me to “put that iPad down” . . . so I very cleverly bought her one!).  But it’s been a struggle to get forms and contract on it to work right.  Maybe my software engineer son can “make an app” for that in 2012.

If you are a landlord in Perrysburg in 2011 you have much to be thankful for.

Your property is most likely rented.

Your tenants are on “good behavior mode” as they know that if they have to look for another 43551 rental house or condo it will not go well.

Your bank account is probably in better shape with rent receipts than if you had to sell and mark your asset to market on the bank/REO depressed current market.

And there are no hassles in Perrysburg from the local constabulary . . . unlike a rather large and more regulatory rapacious city just to the north that I will not mention.

There are – at least according to my Mark 1 Eyeball – fewer for rent signs up in Perrysburg now than in recent memory.   Only 1 of my managed properties and 0 of my own properties has a vacancy.

The WSJ has a nice piece on the situation here.

Implications?

If you are fully invested in the stock market . . . . you must be addicted to risk.   Diversify into some nice multifamily in Perrysburg or Sylvania.

If you are fully rented out . . . now is the time to raise your rents.

If you are looking to get out of the rental market . . . not a bad time to sell your multifamily property in Perrysburg (since values are based on cash flow imho).