Perrysburg Blog

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.

I sell houses.  And I have been blessed to sell a lot of houses in 2011.  More, in fact, than any other Realtor in this market.

And I have sold some amazing mansions this year.  And some houses that should have been torn down.

But they all sell – at some point.  Given enough time and the right effort.

Many sellers/homeowners ask me “what can we do to get our house sold”?

Clutter matters.  Decluttering can help sell us sell your house.

Condition matters.   Fixing your houses’ problems can help us sell your house.

Location matters.  So . . . picking up or repairing your neighbors problems can help us sell your house.

And marketing matters.  Getting the word out about your house to the most potential buyers and then actually answering their inquiries really matters in selling your home.

But – in THIS market – the number one determining factor in selling your house is price.

Price can fix everything in selling your house.

It fixes clutter.

It fixes your bad basement.

It fixes your neighbors messed up garage and yard and gutters and weeds.

It fixes your current Realtors’ utter lack of marketing and salesmanship — like the house in Perrysburg without a for sale sign that I wrote an offer on this week (whose out of town owner has NO idea what her agent is up to . . .) to the listings with recorders and voice mail that “answer” every call that buyers make.

Price fixes ALL of those sins.

With mortgages at amazing levels . . .

With prices in Perrysburg leveling off . . .

With buyers always looking – even this Winter – for good listings to buy . . .

Pricing can fix your home.

Just one thought – work on the other factors first!

They are much cheaper and will put more money in your wallet.

The question is: “Are local city and county budgets going to get slammed by falling property values and the corresponding hit on property tax revenue?”

I say “yes”.

I told a couple of my friends/acquaintances who were/are 0n Perrysburg City Council a couple of years ago to be ready.  READY FOR THIS:

To plan now on having less tax revenue on hand.

The Cleveland branch of the Federal Reserve Bank has an opinion: it’s here.

I have made many crazy real estate predictions:

A. Houses are going to get smaller.

B. Brokerages are going to radically change.

C. Agents are going to go mobile and untethered.

D. The internet is going to rule real estate advertising.

E. Shag carpeting is coming back in style.

Most of them have come true!  Well, except for the carpeting one.

But the prediction on municipal revenue is very difficult to accept.  What if the Lucas County lost 25% or 35% of it’s tax base?

What if Wood County lost 20%?  What will happen to city services and infrastructure and jobs and pensions if 50% of our tax base melts away (travel to Detroit or Flint for a view of the future . . .)

Think I am being alarmist?  Read what they are saying in Rhode Island.

Hard choices result.  Put them off . . . . and your entire city can be destroyed (see Detroit, above, which is heading for total financial meltdown with state control of it’s entire budget).

If you add in the effects of the decline in valuation and the imputed number of properties NOT paying any property tax at all in Lucas County . . . it’s a huge problem.

Tax increases are not going to work – no one will vote for them to pass and if you target businesses instead of people, they and their jobs/employees will simply decamp for Tennessee or Indiana (or Mexic0 or China).

In Wood County the property tax provides about 20% of the county’s income/revenue.   And the 2009 tax valuations are fractionally lower than the 2005 total valuation.  2005 was the last of the “boom years”.   I think that the county numbers are going to adjust down – by 20%.    The residential component is 70% of the total – so even record setting farmland prices won’t help when valuations are “normalized to the market”.

From the City of Perrysburg’s point of view it’s not that bad – real estate taxes make up about 10% of the city’s revenue.   So it’s not catastrophic.   The hit comes when the county/state feels the pain and starts squeezing the municipalities.

It’s started – and it’s going to get worse.

Caveat Emptor?  It’s the Latin rendering of “let the buyer beware”.

Because buyers need to beware.   At least in Ohio they do!  A quick Google.com scan shows thousands of entries for “caveat emptor” in Ohio real estate.   It shields the real estate seller.  It protects the real estate agent.  It immunizes the real estate broker.  A good example, from a Realtor trade rag is here.

I had to put a house on the market that made this very painfully real.

The “buyers”, who shall remain nameless, simply relied on what the “seller” told them.   They trusted.  But did not verify.

Big mistake.

The “seller”?  He did not have real title to the property.  It was not his to sell.   There was a bank somewhere – not getting paid.   The “buyers” gave their rather sizable down payment to this Perrysburg-based con artist.   Their “down payment”?   Gone.  Scammed.   Stolen.

They were buyers – and they were not careful.

The damage to them – emotionally, financially, and more was and is terrible.

The seller/agent was neither a real seller or a real real estate agent.

Nothing was as it seemed.

I would trust . . . but then verify:

1. Who are you?

2. Why are we not using a title agency?

3. You allright with my lawyer looking at this?

4. Why isn’t your deed recorded?

5. Why don’t you have an office?

Just a few things to consider and learn to ask so that you can avoid some of the scams that are being done right now on innocent, trusting, unaware buyers!

Disclaimer:  no snarky comments or inferences in this post should be construed as anything but an endorsement for my Dentist – Dr. Christopher Clark.  I like him.  He is incredibly talented.  He knows the ins/outs and tools/tactics to do any dental procedure with elan and skill and care.

But . . . sometimes selling a house in Perrysburg today IS like going to your dentist and getting root canal.  Which I just did with Dr. Clark.

It takes time.

It takes multiple appointments.

It takes effort.

It takes reasonable skill and training.

The dentist has to have the right tools and facilities.

The dentist has to have the right support staff.

You want your dentist to be . . . actually working full time in and on dentistry.  

All of these things are similar in my pursuit of helping clients sell their real estate and my dentists skill and care at removing dental problems.

(But . . . I sadly note . . . that I cannot give you laughing gas or an anesthetic shot to make your pain fade for a couple of hours).

As with the average root canal . . . in selling a home today there is perhaps going to be some pain involved.

Some emotional conflict.

Some stress and or trepidation.

But . . . if it has to be done and needs to be done and the situation and circumstances tell you to get it done . . .  what else can you do?

You get it done.

That’s the abbreviation for “good news . . . bad news”.

I have seen lots of multiple offers in Perrysburg.

I have seen a seeming “shortage” of good listings priced to market.

But is that good news?  Or is that bad news?

It really depends on where you are sitting and whose side you are on.

A buyer/future homeowner?  That’s often bad news.

A seller/homeowner?  That’s maybe good news.

Now – more GN/BN.

The Case-Shiller numbers just went UP for the first time in a long time – as far as Detroit matched pair real estate numbers go.  And I really do believe that Detroit is now the perfect analog for Toledo real estate numbers and velocity of sales.

So . . . . that’s good news, right? Yes.   I think so.

What’s the bad news?

Mortgage defaults – i.e. future foreclosures – are going up for the first time in 2 years.

It came from a blurb on housingwire.com:

“The national delinquency rate for borrowers who are 60 days or more past due on their mortgages rose for the first time in two years during the recent third quarter, TransUnion said Tuesday.

The delinquency rate for seriously past due loans edged up to 5.88% in 3Q, TransUnion reported.”

Which tracks what I am seeing – lot’s more foreclosures in Perrysburg and Maumee.  

That is the bad news.

You know I love numbers if you read this blog.   More numbers!   More stats!  More graphs!

And you might think that I therefore believe that you figure out the Perrysburg real estate market by reading the statistics reported by the media.

But, the numbers aren’t always the numbers and here’s why!

Sales Prices

• May include seller-paid buyer’s closing costs and/or bonus commissions paid to buyer agents that distort the true property value.
• On FHA loans that close today . . . almost ALWAYS includes 3.5% credits to the buyer.
• May include major repairs and or other credits on cash sales.
• Often use funky/wonky things like tax prorating methods to shove more cash to a buyer.

Average Prices

• Can be influenced substantially (higher or lower) according to the mix of properties sold during the time period.
• In a small sample size – one or two large sales can skew the numbers.

Days On Market

• Can be gamed by pulling the property off the market for 30 days, then re-listing.
• Can also be gamed by changing the address spelling (North First Street vs. N. First Street or N. 1st Street, for example).
• Often covered up by switching brokers.

So . . . the numbers you read are not always truthful.

But I still love analyzing and sharing them!

Here is a tabular report of the MSI – Month’s Supply of Inventory – for Perrysburg as of 30 days ago.

Seasonality is stronger than it was 5 years ago.

20% or so fewer houses active on the market vs. 2 years ago and WAY down over 5 years ago.

8 months or so of inventory?  Pretty balanced in my opinion – as I am hearing from more and more buyers who are NOT getting the house they bid on – which was unheard of last year.

And I am not sure that I like it . . .

Because I just wrote an offer and got a home sale pending for the “child” of a client.

Yep.   Someone’s “little kid”.   Whose dad I sold a house for many, many moons ago.

Now buying a home with me and my team.  Taking out a mortgage.  Signing legal documents.

Great.

Which means:

1. Either I have been selling houses for over 20 years. Or,

2. There is a time warp and a dimensional shift has occurred since I don’t feel that old.

In any event it is always a compliment to be chosen to help a man/woman/family find and buy their new home.

It’s a compliment to have loyal, faithful clients – who often turn into friends.

But really – your kids are growing up way to fast!