I was the speaker at the Anchorage Lions Club last week. What follows is the outline of the presentation, in the form of a quiz. Answers appear below. The statistics are current as of the latest report from Alaska MLS, Inc., published October 10.
1. At the present rate of sales, how long will it take to sell the 40 homes for sale that are priced over $1,000,000?
a) one year b) 18 months c) two years d) three years e) five years
2. What is the gap between the asking price of a home this year when the sellers accepted an offer, and the price they got?
a) 2.5% b) 4.5% c) 7.5% d) 9.5% e) over 12%
3. How many homes were for sale at the end of September?
a) 275 more than the prior year b) about the same as the prior year c) 275 fewer than theprior year d) More than any time in the past 15 years e) fewer than any year in the 1990 decade
4. The average price of homes sold so far this year compared with 2007 is
a) 10% lower b) 5% lower c) about the same d) higher than last year
5. The average 2008 sales price of homes in Anchorage compared with the year 2000 is
a) 25% higher b) 50% higher c) 75% higher d) double e) 150% higher
6. The number of sales of Anchorage homes through September is
a) off 5.5% b) off 9.5% c) off 15.5% d) up 5% e) about the same
7. What is true about marketing times of homes in Anchorage?
a) It’s taking longer to sell a home this year, and homes now for sale have been on the market longer than last year
b) Home this year have been selling in less time but the existing inventory is experiencing longer market times
c) It has taken longer to sell a home this year but the existing inventory has not been on the market as long as homes that were for sale last year
8. Historically, what factors have had the biggest influence on Anchorage home values?
a) Price of oil
b) Jobs and population
c) Party in power in Washington
d) Realtors and mortgage lenders
e) Interest rates
9. What caused the real estate crash in Alaska in 1985-6?
a) Price of oil
b) Completion of Project ‘80’s
c) Tax Reform Act of 1986
e) All of the above
f) Something else: ______________________________
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Answers: 1(d); 2(a); 3(c) and (e); 4(c); 5(c); 6(b); 7(a); 8(b); 9(e)
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For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Thursday, October 16, 2008
Monday, October 06, 2008
Alaska publishes new disclosure form
If you have a property on the market at present you'll need to replace the Alaska Real Estate Commission property disclosure form with the updated version published over the weekend. New listings will use the new form hereafter.
The basic form is largely unchanged. Housekeeping and modernization were needed. Examples include adding solar panels, wind generators and swimming pools to the list of items one can check to say something is wrong with them.
Perhaps the most substantive change is the requirement to disclose if you know of any murders or suicides at the property in the past three years, and whether the property contains any human remains. While not explicitly stated, it would appear that the scattered ashes of a deceased should therefore be disclosed.
The phrase "mildew or mold issues" appears as a new required disclosure. This may be hard for some to answer with confidence. Mildew and mold are very common in damp places like bathrooms, crawl spaces, attics and the backs of closets where air movement doesn't take place and cold walls can host some condensation. It takes testing by a specialist to conclusively identify what's there. Alaska's disclosure law does not require independent testing, however, so it should be enough for homeowners to simply say whether they know of mold or mildew in the home.
EPA guidelines say that mold and mildew -- they are much the same thing biologically -- require continuous moisture. The common remedy therefore is to identify the source of moisture and dry out the area. Then the dead mold can simply be wiped down with Kilz and painted over.
The new disclosure form states in the instructions that Alaska law requires amendment of the disclosure if a seller comes by new information about the property. If a buyer is under contract at that time, amending the disclosure gives the buyer the right to back out without penalty within three days. That's not new, although the language pointing this out wasn't in the instruction set of the old form.
What is new, however, is the statement that any inspection report the buyer obtains is "automatically" a new disclosure of the seller, thus triggering a three-day right to cancel at that point. The purchase and sale agreement widely used by Alaska MLS, Inc. members has long read this way. The new disclosure form in effect codifies a common practice for a great majority transactions where the the MLS form is used.
The requirement to disclose old engineer and property inspector reports has been expanded from two years to five. The new form has a yes/no question as to whether the homeowner "to best of your knowledge" is aware of reports that are as much as five years old. The old form had a check box in a section called "Documents . . . the seller has available for review" for reports "completed in the past 24 months". The time line in that checkbox has been deleted on the new form. This may enable a homeowner to truthfully answer that he or she is aware of past inspections but not have to dig around to find the report itself if it has since been lost.
There are a few other new questions. One asks about freeze-ups and the use of "heat tapes, heat lamps, or other freeze prevention devices". Another asks about water contaminents. There are more detailed questions about flooding and flood zones. The question about soil conditions has been reworded to require only disclosure of conditions "that affect the improvements of the property".
The new form was some time in the drafting, review and approval process. It contains many consumer-friendly and litigation-avoiding improvements. It also steered away from some of the objectionable things that appeared in earlier drafts, such as one question that could have been read to require disclosing if there are ghosts in the home.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
The basic form is largely unchanged. Housekeeping and modernization were needed. Examples include adding solar panels, wind generators and swimming pools to the list of items one can check to say something is wrong with them.
Perhaps the most substantive change is the requirement to disclose if you know of any murders or suicides at the property in the past three years, and whether the property contains any human remains. While not explicitly stated, it would appear that the scattered ashes of a deceased should therefore be disclosed.
The phrase "mildew or mold issues" appears as a new required disclosure. This may be hard for some to answer with confidence. Mildew and mold are very common in damp places like bathrooms, crawl spaces, attics and the backs of closets where air movement doesn't take place and cold walls can host some condensation. It takes testing by a specialist to conclusively identify what's there. Alaska's disclosure law does not require independent testing, however, so it should be enough for homeowners to simply say whether they know of mold or mildew in the home.
EPA guidelines say that mold and mildew -- they are much the same thing biologically -- require continuous moisture. The common remedy therefore is to identify the source of moisture and dry out the area. Then the dead mold can simply be wiped down with Kilz and painted over.
The new disclosure form states in the instructions that Alaska law requires amendment of the disclosure if a seller comes by new information about the property. If a buyer is under contract at that time, amending the disclosure gives the buyer the right to back out without penalty within three days. That's not new, although the language pointing this out wasn't in the instruction set of the old form.
What is new, however, is the statement that any inspection report the buyer obtains is "automatically" a new disclosure of the seller, thus triggering a three-day right to cancel at that point. The purchase and sale agreement widely used by Alaska MLS, Inc. members has long read this way. The new disclosure form in effect codifies a common practice for a great majority transactions where the the MLS form is used.
The requirement to disclose old engineer and property inspector reports has been expanded from two years to five. The new form has a yes/no question as to whether the homeowner "to best of your knowledge" is aware of reports that are as much as five years old. The old form had a check box in a section called "Documents . . . the seller has available for review" for reports "completed in the past 24 months". The time line in that checkbox has been deleted on the new form. This may enable a homeowner to truthfully answer that he or she is aware of past inspections but not have to dig around to find the report itself if it has since been lost.
There are a few other new questions. One asks about freeze-ups and the use of "heat tapes, heat lamps, or other freeze prevention devices". Another asks about water contaminents. There are more detailed questions about flooding and flood zones. The question about soil conditions has been reworded to require only disclosure of conditions "that affect the improvements of the property".
The new form was some time in the drafting, review and approval process. It contains many consumer-friendly and litigation-avoiding improvements. It also steered away from some of the objectionable things that appeared in earlier drafts, such as one question that could have been read to require disclosing if there are ghosts in the home.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Tuesday, August 12, 2008
Anchorage market stable, improving
There have been a few anxious months of speculation about the health of the Anchorage real estate market. Data just out from Anchorge MLS, Inc. suggests our market is healthy and strengthening.
- The average sales price, just over $326,000, is down only a quarter-percent from the first seven months of last year. Earlier in the year we were seeing a decline closer to a half-percent
- The number of homes for sale at the end of July has dropped from 1378 last year to 1168 now. That's a 17% reduction in inventory in a year!
- Total sales are off 10.5% year-to-date. But that's down from the 13% decline that MLS reported for the first five months of this year.
- The average gap between the price a home was listed for when it sold, and its selling price, narrowed from 2.75% this spring to 2.25% for the year so far at the end of July.
- The group of homes recently sold that has not closed yet show a market time of only 65 days, about the same as the time it took homes to sell in the first seven months of last year.
- There is about a five month supply of homes for sale in the average price ranges of $250,000 to $500,000. (Don't think about the three-year supply of the three dozen million-dollar homes for sale!)
- The average price of condos sold so far this year is up nearly a full percent.
All these indexes are certainly heartening. My anecdotal sense of the market is that sellers have adjusted to a "sideways market". Buyers who have a real housing need, such as new arrivals, are enjoying the benefit of a market that is stable and somewhat predictable, in terms of what they can see and expect. The decline in sales is explained mostly by the local buyer who has been placing too much stock in reports of how awful some hyper-inflated markets Outside have become.
The pessimism of the minority has depressed the number of sales, but not values. Absorption has decreased the number of homes for sale, and market times have decreased, so prices may be headed for positive territory by year's end.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.Friday, April 11, 2008
Mortgage Insurance Report: Anchorage at Low Risk of Market Decline
The risk of a decline in home prices in Anchorage is 2.1%, down from 3.1% earlier last year, according to a study by the nation's leading mortgage insurance carrier, PMI. Contributing to the favorable index is a low level of price volatility compared to many markets Outside.
Mortgage insurance carriers issue insurance polices, paid for by borrowers, that offset a lender's losses when a property forecloses. Risk-based analysis is how they determine insurability in different markets.
The headline of the report, of course, is the substantial declines now happening in other markets. It isn't over in those areas that experienced unsustainable appreciation earlier in this decade, the report concludes.
Affordability in Anchorage improved somewhat in the fourth quarter of last year, based on the report's proprietary index. However, the index finds that home affordability is now slightly less than the baseline year 1995.
The full report is on-line at this link. Anchorage numbers appear in the report summary at this link.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Mortgage insurance carriers issue insurance polices, paid for by borrowers, that offset a lender's losses when a property forecloses. Risk-based analysis is how they determine insurability in different markets.
The headline of the report, of course, is the substantial declines now happening in other markets. It isn't over in those areas that experienced unsustainable appreciation earlier in this decade, the report concludes.
Affordability in Anchorage improved somewhat in the fourth quarter of last year, based on the report's proprietary index. However, the index finds that home affordability is now slightly less than the baseline year 1995.
The full report is on-line at this link. Anchorage numbers appear in the report summary at this link.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Friday, February 22, 2008
Real Estate "Spring" Starts Early
Spring starts early in the Anchorage real estate market. I don't go on vacation at this time of year: too many clients need me to do something for them. The light levels are coming up, temperatures rise, and there's lots to do. It's Rondy time!
Consider pending sales reported to Alaska MLS Inc at the end of January. An uptake of about 50 from the holidays. At 200 deals waiting to close, it's about the same as this time last year, before some people started trash talking real estate.
New listings start coming to market now. In most market segments you see about half the inventory consists of properties left over from last year with extended market times. That inventory is aging in place with only the best values in any market segment attracting buyers. The average market time of all homes for sale is 125 days in the Anchorage bowl, 131 in Eagle River.
The other half of the inventory are today's sellers. They come to market mindful of what failed for others last year. They price to beat the competition and create a spring sale. There were 956 homes for sale at the end of January, up from 880 a year ago and about the same number as the 1990 "normal" decade.
Mixed in with the stale inventory, however, are some of the best buys to be found at this time of year. I tell sellers that if they don't secure a sale in 90 days or less they will get less for their homes later. The flip side, for buyers, is to be sure to consider tired old listings: some of those sellers who were in denial may be ready to give up and sell now for a fair price.
Institutional owners such as relocation companies and banks that have acquired foreclosed inventory have scattered offerings. An Associated Press business writer reported last week that foreclosure sales are only 0.6% of total sales in Alaska last year, down from 0.7% in 2006 and compared with 4.7% nationally. I market REO (foreclosure) inventory for Alaska's largest lenders; my workload in this area has increased, but it isn't a flood.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Consider pending sales reported to Alaska MLS Inc at the end of January. An uptake of about 50 from the holidays. At 200 deals waiting to close, it's about the same as this time last year, before some people started trash talking real estate.
New listings start coming to market now. In most market segments you see about half the inventory consists of properties left over from last year with extended market times. That inventory is aging in place with only the best values in any market segment attracting buyers. The average market time of all homes for sale is 125 days in the Anchorage bowl, 131 in Eagle River.
The other half of the inventory are today's sellers. They come to market mindful of what failed for others last year. They price to beat the competition and create a spring sale. There were 956 homes for sale at the end of January, up from 880 a year ago and about the same number as the 1990 "normal" decade.
Mixed in with the stale inventory, however, are some of the best buys to be found at this time of year. I tell sellers that if they don't secure a sale in 90 days or less they will get less for their homes later. The flip side, for buyers, is to be sure to consider tired old listings: some of those sellers who were in denial may be ready to give up and sell now for a fair price.
Institutional owners such as relocation companies and banks that have acquired foreclosed inventory have scattered offerings. An Associated Press business writer reported last week that foreclosure sales are only 0.6% of total sales in Alaska last year, down from 0.7% in 2006 and compared with 4.7% nationally. I market REO (foreclosure) inventory for Alaska's largest lenders; my workload in this area has increased, but it isn't a flood.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Sunday, January 20, 2008
City Tax Assessments Mailed; Values Fit with Market
Your "green card" is in the mail. If you are thinking of appealing the Muncipality's tax-assessed value of your property you have 30 days.
The Anchorage Daily News carried an interview with the Assessor, Marty McGee, in today's edition. McGee is saying assessments track the conclusions I documented from MLS data in my reports published last week.
For the minority view of whether "the gummit" should be collecting property taxes in the first place, see Dan Fagan's opinion column from the editorial page today.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
The Anchorage Daily News carried an interview with the Assessor, Marty McGee, in today's edition. McGee is saying assessments track the conclusions I documented from MLS data in my reports published last week.
For the minority view of whether "the gummit" should be collecting property taxes in the first place, see Dan Fagan's opinion column from the editorial page today.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
Monday, January 14, 2008
2007 Annual Homes Sales Data Published
Just in time for my Annual Market Report and 2008 Forecast, Alaska MLS Inc. has published year-end data for 2007. You can reach the summary of that information I presented to the Anchorage Board of Realtors® on January 9 from this page of my site: Market Report.
The Anchorage Daily News yesterday (June 13) published its account of this information at this link: ADN Real Estate Story.
The source data charts and graphs are at this link: AKMLS Market Data. The annual reports on this page are from a year ago, but the monthly reports include data from December 2007 and include full-year comparisons with prior years. The MLS annual report format comes out around March, after brokers have late-filed their remaining sales and all the data is cleaned up.
The headline numbers are that the average price of a home in Anchorage rose 3.75% last year, notwithstanding a 10.3% decline in total residential sales. Only high-end homes, above $750,000, are experiencing excessive market times. Those sellers are in the process of adjusting their expectations.
The gap between final listing prices and ultimate selling prices has widened to 1.75%. That figure does not, however, reveal what I believe is a pattern of larger below-the-top-line concessions like seller-paid closing costs and builder upgrades. Nor does it break out market performance by quarter for last year, which probably would have shown a weaker market in the fall and early winter than the first half of the year.
The 944 homes for sale at the end of December is consistent with the balanced market of the 1990 decade, but about one-third more than we have seen at this time of year since 1998.
These numbers show Anchorage to be in far better shape than the headline-grabbing markets of the rest of the country, especially the West. According to year-end data from the National Association of Realtors®, prices have declined 3.3% in the overall US, and 6.8% in the West. The number of closed sales is off 20% in the US, 25% in the West.
The stable Anchorage market and forecast are consistent with favorable economic and job data from the Alaska Labor Department, which points out that Anchorage is in its 19th consecutive year of economic growth. Still, the current market feels more like a market going sideways than one that we can be sure will grow signficantly in 2008.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
The Anchorage Daily News yesterday (June 13) published its account of this information at this link: ADN Real Estate Story.
The source data charts and graphs are at this link: AKMLS Market Data. The annual reports on this page are from a year ago, but the monthly reports include data from December 2007 and include full-year comparisons with prior years. The MLS annual report format comes out around March, after brokers have late-filed their remaining sales and all the data is cleaned up.
The headline numbers are that the average price of a home in Anchorage rose 3.75% last year, notwithstanding a 10.3% decline in total residential sales. Only high-end homes, above $750,000, are experiencing excessive market times. Those sellers are in the process of adjusting their expectations.
The gap between final listing prices and ultimate selling prices has widened to 1.75%. That figure does not, however, reveal what I believe is a pattern of larger below-the-top-line concessions like seller-paid closing costs and builder upgrades. Nor does it break out market performance by quarter for last year, which probably would have shown a weaker market in the fall and early winter than the first half of the year.
The 944 homes for sale at the end of December is consistent with the balanced market of the 1990 decade, but about one-third more than we have seen at this time of year since 1998.
These numbers show Anchorage to be in far better shape than the headline-grabbing markets of the rest of the country, especially the West. According to year-end data from the National Association of Realtors®, prices have declined 3.3% in the overall US, and 6.8% in the West. The number of closed sales is off 20% in the US, 25% in the West.
The stable Anchorage market and forecast are consistent with favorable economic and job data from the Alaska Labor Department, which points out that Anchorage is in its 19th consecutive year of economic growth. Still, the current market feels more like a market going sideways than one that we can be sure will grow signficantly in 2008.
For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.
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