Perrysburg Blog

One thing to add is a clear, shoveled driveway and sidewalk.

But that will become less and less important as we hit March and April . . .

AVID Ratings does a big survey every year (LINK).  Here is what the survey said!

1. Large kitchen with an island
2. Energy efficient appliances, insulation, and windows
3. Home office / study
4. Main-floor master suite
5. Outdoor living room
6. Ceiling fans
7. Master suite soaker tubs
8. Stone and brick exteriors
9. Community landscaping, including walking paths & playgrounds
10. Two-car garages

Now – these all sound reasonable.

I would add a few Perrysburg-focused items that will BOOST your homes value:

1. A three car garage (you can’t “add” this, but you can plan it for your next house . . . )
2. Kitchens and Baths – update them!  There is nothing wrong with changing out a 20 year old microwave . . .
3. Do something to bring light into the house – glass front door, Solatubes, skylights.
4. Landscape lighting.
5. A “moderate” finished basement (carpet, black painted ceiling, painted walls, lights).

These features add “zing” and “POW!” to the buyers memory banks when they compare your home to another when it is time to sell it.

They have both a high “return” in that you can enjoy the improvements while you live there and then get some resale value out of them when it’s time to move.

For the month of July and as of today:  Perrysburg City and Township.

Active Listings

148 houses for sale.

Price Range $59,500 to $650,000

Contingent Listings

7 houses contingent on another house closing

Pending Listings

17 houses went pending in July.  $89k to $265,850

Sold Listings

49 Houses closed in July.  $52k to $480,000

Withdrawn Listings

8 Houses withdrawn from the market in July

Failed to Sell / Expired

19 Houses failed to sell in July and went off the market.

Median Price

$185,000 in July 2009

Days on the Market

95 Days on the Market for SOLD listings in July

Months Supply of Inventory

6.2 months in Perrysburg

My oh my!

Some better numbers!

Green shoots?

Nope.

Buyers remain very, very cautious.

We are seeing sellers who MUST sell and who are VERY motivated.

They can easily sell in today’s market.   But then – they always could.

I think we are back to a more seasonal pattern of sales.  I think that the panic is now gone out of the market.

I am always asked  “When will _____ (you fill in the blank: prices, sales, values, etc) come back?”

I always will answer:  when the JOBS come back.

Everything else is window dressing.  Goosing today’s sales with $8k credits, looser FHA standards, cheap money – not going to help in the long run and will help bankrupt our country oh, in about 2 years.

Jobs.  Get that right and the real estate market will ROAR back.

Toledo double taxing its’ citizens.

Bowling Green sending us a new corporate HQ.

Toledo laying off their police force.

All of these things tend to increase residential housing demand and values in our little town of Perrysburg.

Now I just learned that in one years time – which if you hadn’t noticed seems to arrive very much faster today than it did years ago – in April of 2010 the rules re. lead based paint are going to change.

Currently any Realtor selling any home built before 1978 has to provide a Lead Based Paint Disclosure to the buyer.   This is a trivial thing – for not once have I ever met a seller that had known that he had lead based paint in their house.  No one tests – so no one knows.

So the disclosure has what value?

Zero.

Nada.

None.

Year after year Realtors have been giving disclosures that say nothing to people who know nothing so that people can not read them but sign them anyway.

All at the behest of the Federal government.  (And you are worried about them running GM?)

But that is ALL going to change.

Starting on 4/22/2010 ALL regular consumers and normal Joes who buy investment property – duplexes, triplexes, 4-plexes, and even single family houses – for use as rental properties have to abide by the rules that giant “Market Rate” owners of thousands of properties have to abide by.

Such as:

-Testing each and every unit ($500+)

-Building and keeping and supply an audit-proof paper trail on all work done in each rental unit.  Fine for bad paperwork?  Up to $33,000!!!!

-Containing ANY work area in ANY pre-1978 rental unit just like it is an asbestos contamination zone.

-Only using  power tools with HEPA attachments in such units.

-Seeing that ALL personal that do ANY work in such units are trained and certified.

Painting more than 6 square feet of a pre-1978 built rental property?  You are most likely going to have to hire a professional  and PAY BIG MONEY.  Or else test and prove you have no lead in your unit.

How in the world does this help Perrysburg?

Think about it . . . the NEWER suburbs with NEWER rental properties are EXEMPT from this madness.

If you have a post 1978 rental property you can just smile at this insanity.  If you want to sell it, and I am your listing agent, we will make sure to point out in our marketing that it is LEAD FREE and EXEMPT from the new law.   This will, in my opinion, have a huge impact on values and investment property demand.  Most of Perrysburgs RENTAL units are post-1978.

I could go on . . . trainers need to be EPA certified, firms need to be certified, if a child comes into contact with dust from a building as they walk on the sidewalk . . . you cannot imagine what this is going to cost.

But not to the majority of Perrysburg rental units.

Duplexes “in the Boundary’s” are hit.

Some units in Southwood Park . . . maybe.

Three Meadows  – safe.

Most of the Township – safe.

The City of Toledo – in 10 months you won’t want to own so much as a stick of wood in that town if you are a property investor.

Not unless you are either a lawyer or a commercial painting contractor.

Do you see it?

Not many do.

I will share with you my current take on the Perrysburg/Northwest Ohio real estate market.

First – there are TWO markets.   Not surprisingly you may have already figured this out.  There is the REO/Bank Foreclosure market.  And then there is everybody else.

Two markets – in the same market space.

Competing with each other.  Interacting with each other.  Together making up one single market.

I believe that every single buyer and seller has to understand this in all its’ implications.

Second:  There is a giant elephant standing the corner of the Perrysburg market.

Many agents are willfully blind.  Many sellers are deluded.  Many people don’t want to talk about him.

But I will.

That giant elephant in the corner?  He is representing the lack of “move up” buyers in the current Northwest Ohio real estate market.

Move up buyers?  They have been Perrysburgs’ bread and butter.  People “move up” out of their Toledo/Sylvania/Maumee/Point Place home to a larger, better, more expensive house in Perrysburg.

These move up buyers made our market work.   They bought the $189,900 house.  The $320,000 house.  The $499,900 house.

Now we have a market in NWO full of first time buyers ($8000 tax credit) and full of investors (Heh!  This is better than my stocks!).     This dearth of move up buyers is NOT unique to Perrysburg – see this story.

I talk to many homeowners today – they CANNOT afford to sell and move up.

I can also report, in an anecdotal manner, of buyers who buy who tell me that this is their last house.  They plan on being buried in the yard of their home!   A mental shift has occurred-  houses in Perrysburg are no longer investments, or financial stepping stones on the upward path to The Sanctuary.  No – they are hard-nosed financial purchases that have to work in a families budget.

The upshot – the lack of move up buyers is felt especially hard in Perrysburg and other former “move up” suburbs (Sylvania, Monclova, et all)  and shows no signs of abating.

People who bought at the peak of the market have no reason to sell now and then “lock in” their paper losses.

People who bought and have mortgage problems?  They can’t move up.

Seniors and older buyers?  They are not buying up – they are buying down.

First time buyers?  They ARE buying in Perrysburg, but not in the traditional move up price ranges.

If you have a “McMansion” that you HAVE to sell – I can sell it.  It is salable.  But the price will have to be compelling to attract buyers.

I have sold close to 40 homes in the past 60 days – the highest number in my career.   But that is because I and my team are pricing to today’s market.

Most people know that Perrysburg prices have dropped (a few Realtors surprisingly have not gotten that memo – but I don’t want to be snarky . . .)

But what of taxes?

Property taxes should be coming down too, n’est pas?

I do not believe that the County automatically adjusts taxes down.   They must have missed that memo too!

So what can I do to find out the history of taxes.  Not that hard if you have a record of old MLS comparable sales . . . and here is what we find:

We find that property taxes in Perrysburg have relentlessly increased.

The 3 bed, 1.5 bath house in the Southwood Park subdivision of Perrysburg would cost you $393 in 1/2 year taxes back in 1984.

In 1994 that same house would cost the owner $557.

In 2004 your 1/2 tax bill would have been $1076.

Today?  You are may be looking at almost $1400 per 1/2 year for a 3 bed, 1.5 bath in Southwood Park (Edgewood, Southwood, etc. by the big blue city water tower for those who do not think in terms of subdivisions like I do!) (Caveat: Not everyone pays the same tax amount for the same home – it depends when you were last assessed/appraised by the County, how accurate your assessment is, and if you have recently filed for a reappraisal).

$393 to $1400.   I think that is an increase.

But – property values have declined in 2006, 2007, 2008 and this year.

I wonder if property taxes have gone down since 2007?

What is your experience?

Enjoy your tea!

I do hear this.

Probably at least once per week.  Maybe more.

The buyer calls me or emails me and has the address of a specific house that is REO (”real estate owned” aka bank owned) and wants to see/buy said house.

But the problem is . . . THIS house is not for sale yet.

It is bank owned.  But NOT for sale!

It is part of the “Shadow Inventory”.

“We believe there are in the neighborhood of 600,000 properties nationwide that banks have repossessed but not put on the market,” said Rick Sharga, vice president of RealtyTrac, which compiles nationwide statistics on foreclosures. “California probably represents 80,000 of those homes. It could be disastrous if the banks suddenly flooded the market with those distressed properties. You’d have further depreciation and carnage.” (San Francisco Chronicle)

Many people cannot understand why it is not for sale.

There are many reasons.

1.  The foreclosure process may not be completed.

2. The former home owner may still be occupying the house.

3. A tenant may be in the house.

4. The home is being appraised/prepared for market.

5.  The lender is simply overwhelmed and CAN’T get it on the market.

6. The lender is not willing to sell it – so that it does not have to be written off as bad debt on their balance sheet.

And amazingly the most common reason is that the bank is simply not going to put it on the market right now.

Which seems to make no sense.

But if ALL the REO homes hit the market right now . . . their values would be very depressed.  So it makes financial sense for banks to parse them out “slowly” or at lease more slowly then they can be marketed.

And think about this – up until this year, in Perrysburg, we have MAINLY been dealing with “Alt-A” and Sub-prime foreclosed loans.

But there is a giant “clot” of OTHER types of bad loans/foreclosures coming right for us.

Look at this chart:

It is a forecast of the future REO inventory.

And it is a sobering picture.

Here’s a breakdown of Perrysburg’s year-to-date sales activity:

• 249 homes available
• 43 homes pending or contingent
• January Closed Sales = 25
• February Closed Sales = 25
• Total YTD Closed Sales = 70
• Total listings that were “expired” and failed to sell YTD = 74

Interpretation:  How important is price?

Very important.  Only sellers pricing to market have any hope of selling.  If NO new homes/listings come on the market we have almost a one year supply of inventory right now.  But of course – new listings are available every day.

Price is the king today, and will be for some time in Perrysburg.

How am I pricing?  What am I doing to get 11 offers in one day like I did today?  You can find out at www.JonModeneTeamMarketingPlan.com

Data pertains to Perrysburg City and Township  single-family homes and does not include condo or townhome properties.  MLS data from NORIS and does not include all area sales.

Not one bit.

There are going to be income phase outs.

There are going to be all kinds of government red tape requirements.

But don’t believe me.

Read the experts.

A real economist, James Hamilton, opines:

“If my hunch is correct, then all the house purchase tax credit will do is to modestly increase the number of houses sold each month… with no noticeable impact on house prices.

That doesn’t mean that the tax credit would have no impact. In particular, it may be a boon to some cash-constrained households that want to buy a house right now but can’t borrow enough. And it should help to reduce inventories of unsold houses by a bit. But if you’re hoping that it will make house prices rise, with all of the beneficial economic effects on home equity that such a rise might have… think again.”

Do we really want to be encouraging “cash constrained households” to buy houses they really cannot afford today?

Seriously.

Is not that “solution” somehow related, at least tangentially, to the problem we find ourselves in?

With a GM and Chrysler bankruptcy imminent . . . with declining real property values in Perrysburg . . . with our regional banks failing . . . might I suggest a tax cut?  A payroll tax cut?  A tax holiday?  A tax cut for business?  Something to goose employment?

I will encourage every American to pray for our leaders.  Pray that they have wisdom.  They are lacking it right now by borrowing or printing a TRILLION DOLLARS that we don’t have for things that will not work.

I just returned from a week away from Perrysburg. In Orlando.

And if you spend enough time there – at conferences, conventions, and meetings (and at Disney and Universal when the kids are growing up) you ALMOST feel as if you are a part time resident.

Well my wife and I now feel that way.

But we have always resisted the urge to buy real estate there. Always.

And we are now very, very glad that we did.

40,000+ homes went under the gavel in the month of June alone in Florida. That is 1 out of every 200 houses in just one month in Florida.

And my “Realtor trained eyeballs” told me that there are a lot of problems in Orange County. Talking to some Orlando based Realtors at the 2 conferences I was at confirmed it. (you can check out the Case Shiller raw numbers yourself here at the S&P site: http://www2.standardandpoors.com

What did I learn?

That we should not in any way complain about the terrible real estate market we are experiencing in Northwest Ohio. Are problems are nothing compared to the problems that Orlando is just beginning to face.

House after house is for sale.

And worse than that . . . are the “zombie properties” that the banks will not even foreclose on or take back. These properties are so unsellable and so overvalued that the banks let the upside down sellers stay in them waiting for 12 to 24 months for a future day of financial reckoning.

There is no good news in Orlando if you own real estate. If you don’t?  Well call me and I will refer you to a great buyer’s agent who will – in about 12 months – help you to invest in property at about 50% off of what it is “worth” today. That’s when I will be buying.

But Perrysburg?  We will see nothing and have seen nothing like this.

Our banks are stronger. Our homes are worth more – and they never were bid into the stratosphere. Our economy is much more diversified.

It was good to come home.