Anchorage Real Estate

Anchorage Home Prices Steady 2011 Year-End

2012-01-10T11:08:00.000-09:00

The average selling price of a home in Anchorage last year was $322,280. This is the fifth consecutive year of average prices coming to rest in the $320,000-$330,000 range. In the ten years prior to 2007, home prices doubled. Given what's happening in so many other markets, Anchorage has much to celebrate!

Alaska MLS Inc. published year-end statistics today. The reports (http://www.reals8.com/statistics.htm) document the continued stability of the Anchorage housing market.

But for a flood of negative housing news coming from Outside, one would expect home prices to be rising here, given supply and demand factors. A total of 2367 homes sold last year, a two percent increase over 2010.

More sales happened during a time of a record low rate of new home construction. The market absorbed inventory, and by the end of December there was only a little over three months' supply of homes for sale. A balanced market is one with five or six months' supply. Where there is a shortage, market forces usually drive prices higher. Low interest rates also should have sparked higher prices. But headline-driven lower consumer confidence levels countered these traditional market forces.

For the last half of last year the total number of homes for sale ran below comparable months of 2010. Only at the $500,000 price level and beyond is there an adequate supply of homes for sale. There's five months' worth from $500K to $750K, ten months in the next $250K bracket, and something over two years of million dollar homes for sale.

Homes sell in about 71 days, and for 95% of their initial asking prices. The pattern is for many homes to have one price reduction of about 3% if they don't sell in a month. That price adjustment usually brings the home within striking distance: the gap between selling prices and where homes are priced at the time of sale is less than 2%. The corollary is that buyers ignore homes priced more than just a few percent above market and don't even make offers on them.

Condo prices have also been stable, with the average selling price in the $190,000 range for four years. Last year's average, $198,855 was almost four percent above 2010. However, lending standards tightened during the year, making financing for some condo projects harder to obtain. This explains fewer sales, a 15% decline, in the face of rising prices. There is only a four month supply of condos at present.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Moving Up to a Better Home? Watch for Bargains This Fall!

2011-07-22T09:15:00.001-08:00

If you live in an older home that's not meeting your needs, this fall may be a great time to upgrade. Signs are developing in some market segments that bargains will appear.

Price and value have everything to do with supply and demand, as we all know. So look for value in market segments where there is an excess of supply and weak demand. If one of those market segments has the type of home you want, your timing is fortunate.

Your timing couldn't be better as to the cost of your mortgage loan. Interest rates are still at at historic lows. (How the US handles its debt issues and how bond markets respond could drive the cost of borrowing higher very soon, however.) The interest rate of your loan can affect your cost of homeownership far more than the price you pay for a property. The take-away these days is to corral as much cheap mortgage money as your comfort level and overall financial picture permits.

If you want to move this fall, now is when you need to see your mortgage banker. Moving up is not as easy as it used to be. The bank is going to want to know what you are doing with your present home. You might not want to sell it and have to be out not knowing where you are going to live next. And no seller will pay attention to you if you make an offer asking the seller to wait for your home to sell. So if you are keeping your home, the lender is going to look at how much equity you have in it. And, they will want you to qualify for that payment, as well as the payment on your next home. And, the lender may want you to make a large down payment on that next home. And, after all that cash commitment, the lender may still want to look at how much money you have left in reserve, such as in retirement accounts and other savings and investments.

So see your banker now. You must have that financial plan in place before you shop. You won't have the luxury of figuring out how you are going to pay for that next home when the opportunity presents itself.

Assuming you and your banker have comfort with each other, where are bargains? That's the "excess-supply-weak-demand" formula. And this fall it's possible that the kinds of homes that many local homeowners would choose for a move up are going to be in their sights.

These homes are often owned by people whose employers move them around regularly. They are in Anchorage for three or four years, then it's back to Lower 48, or overseas. These same employers give them financial incentives in the form of cash payments to get their homes sold. That gives them an edge on the market, enabling them to price their homes aggressively.

Another employee benefit can be the employer's promise to acquire the home if it doesn't sell. When that happens, the employer's third-party relocation service provider puts the home back on the market as an "inventory property".

If this fall market develops as I believe it might, the bargains will be the alignment of three stars that explain weak demand and excess supply.

This summer we are seeing the usual transfers of corporate employees out of Anchorage. It's not "last one out turn off the lights". Just normal activity. That's the first star.

The oversupply would develop because of weak demand. Second star: not as many corporate transfers into Alaska appear as would be required to purchase the homes of those who are leaving.

Third star: because of tighter financing requirements for local upgraders -- that's why I want you to see your banker now -- many Anchorage homeowners can't afford to move into one of those homes. Fewer buyers explains weak demand.

If those stars align as I believe they could this fall, and you are prepared with your financing plan, you could be very pleased at the prices of some of the homes. A corporate seller, for instance, is not going to want to keep an inventory property over the winter. It will be priced for a very prompt sale. When it is, you won't have long to react. At the right price, no matter how weak the demand, anything will sell. If you are ready, you will benefit before the next folks.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Are Foreclosures a Good Deal?

2011-07-22T08:23:00.001-08:00

People often begin a home search saying "I want to buy a foreclosure". What's really meant is "I want a good deal". So what constitutes a "good deal"?

That may depend on how you define the phrase. Sales hype sometimes uses phrases like "below market". To me that's silly. "Market" is the price that willing sellers and buyers who are not under duress will agree. "Unexpected" might be the better word for a price that seems low.

Foreclosures sometimes seem priced unexpectedly low. But there's a reason the market will pay less for these properties. Usually it's condition. A homeowner being foreclosed on is hardly going to leave a home staged for optimal showing. I've seen far worse: on the way out the door an angry homeowner has been known to take a sledge hammer to the place. I'm in the premarketing stage on one where the bid to trash out the place is $12,500!

Sometimes the property is in such poor condition that no bank will finance it. When you see a home with a tax-assessed value of $250,000 being offered for $175,000 that's usually the situation. You have to write a check for the whole price. And, have the additional cash to fix the place. There can be an opportunity in that. If you have that kind of financial depth, and repair skills, you could profit when you resell it.

Even when a foreclosure will qualify for financing there's a market discount associated with simply being a bank-owned property. It's like the kind of stigma that sometimes attaches to a home that has been a crime scene, or is close to commercial development. The discount isn't much in the Anchorage market, perhaps 10%-15%. Lenders would prefer that it not be disclosed that their property is bank-owned, but at present Alaska MLS requires its members to check the box that says it's a foreclosure.

That market discount is not without logic, however. It's just generally true that an institutionally-owned property is often cosmetically that much (maybe 10%-15%) below the standard that most private owners offer. You can buy a foreclosure for less, but if your tastes are like most people you'll be spending as much or more of the difference when you make improvements.

So, yes, foreclosures can be a good deal. If fun for you is playing with your home, go for it.

Yet when you start your search, don't limit your consideration to bank-owned homes. Alaska has one of the lowest foreclosure rates in the nation, which explains our stable market. (See the blog post immediately below this one.) There aren't a lot of foreclosures. Keep your search broad. Focus on all the homes that show some potential for meeting your needs. As you narrow the search you'll form opinions you can trust about which ones represent the best value. Or, "good deal" as you might define the phrase for yourself.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

"Normal" is Good in Anchorage Market

2011-07-22T07:52:00.000-08:00

Anchorage home prices doubled in a ten-year period from the late 1990’s. In 1997 the average sales price was about $160,000. Residential prices settled in the mid-$320,000 range in 2007 and have stayed there since. We have become accustomed to "normal" while many markets in the Lower 48 and Hawaii have cratered.

The average sale price for the first half of 2011 was $323,914. What about the first six months of last year?

The first half of 2010 was a market driven by a Federal tax incentive of up to $8000 for first-time home buyers and others. Anchorage prices rose slightly as a result. This year prices have retreated 2.5% to about the same level as the previous three years. It's back to "normal" this year.

Our condo market enjoyed a similar surge in sales in the first half of last year, with close to 120 properties per month sold in the second quarter. The norm is about 80. Prices remained stable, in the $190,000 range. The average selling price for the first six months of this year was $196,489.

The number of residential properties sold annually in the first six months of the past four years has been about 25% below the rate of sales during the seven prior years, beginning in 2001. This year has seen 1030 homes sold through June. That’s 8.5% fewer than the 1126 sold in 2010, which was fueled by the tax-credit. This year exceeds 2009, however, which had only 998 sales. Earlier in the decade, the first half sales rate was between 1400 and 1500.

Strong demand and many sales early in the last decade played beside insufficient new home construction. A shortage developed, with fewer than 700 homes for sale being the norm for about six years. In the past four years, by contrast, inventory has returned to historic levels that exceed 1000 in most months. At the end of June this year there were 1120 homes for sale, close to the average of the prior four years.

Comparing the number of homes for sale with the rate of sales per month is another way to consider housing availability. A balanced market has about six months’ worth of homes for sale. Lighter inventory means sellers have an edge. Buyers enjoy an advantage when there is more than six months’ supply. The chart to the left shows how Anchorage is a seller’s market up to about $400,000, with buyers having more bargaining power in the upper-middle and higher price ranges. Condo supply, as shown on the last line, has increased after last year’s strong absorption that was due to tax credit sales.

There are early signs of weakness developing in the market this summer. The number of new (pending) sales reported in June was somewhat below historic norms for the month. Homes have taken longer to sell, 76 days during the first half of this year compared with 65 days last year. There were only 74 pending condo sales this June, where the norm has been closer to 100 in that month.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

2009-09-17T11:49:00.004-08:00

August 2009 real estate sales surpassed every single month since June 2006, a just-released report from Alaska MLS, Inc. shows. There were 317 sales that went pending (not yet closed) in a month.

The $8000 tax credit boosted market activity. There is also a feeling of optimism among home buyers and sellers. The Alaska economy and job markets are stable. There are 516 more children than expected in the Anchorage school system, necessitating 53 new hires, http://www.adn.com/news/alaska/ap_alaska/story/935302.html.

Nationwide there are signs of economic stabilization. The risk of further declines, or disastrous setbacks, seems lower than continued recovery. People now talk about how quickly or slowly we will get well in our economic lives; and less about how maybe life as we know it might be coming to an end.

Even the cash for clunkers car program may have played a role in inspiring Anchorage's property sales. All these stimulous measures seem to breeding a sense that it's OK to invest money in property, historically something safe and sound over the long term.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

2009-06-18T06:01:00.002-08:00

Anchorage ranks 5th in a recent study of the potential for home price appreciation by the chief economist of Moody's Economy, as reported in this week's issue of US News and World report, The Top 10 Housing Markets for the Next 10 Years" - http://snipurl.com/kdcib.

"House prices should grow at the rate of household income," says Mark Zandi of Moody's.

1. Bremerton-Silverdale, Wash.: 5.22 percent
2. Glens Falls, N.Y: 4.71 percent
3. Fort Collins-Loveland, Colo.: 4.06 percent
4. Corvallis, Ore.: 3.95 percent
5. Anchorage, Alaska: 3.8 percent
6. Duluth, Minn.: 3.74 percent
7. Sandusky, Ohio: 3.66 percent
8. Santa Fe, N.M: 3.57 percent
9. Pittsfield, Mass.: 3.51 percent
10. Decatur, Ill.: 3.44 percent

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Newest MLS reports discussed at Anchorage Lions Club

2008-10-16T13:14:00.002-08:00

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)
===================================================================

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Alaska publishes new disclosure form

2008-10-06T11:51:00.002-08:00

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.

Anchorage market stable, improving

2008-08-12T17:34:00.001-08:00

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.

Mortgage Insurance Report: Anchorage at Low Risk of Market Decline

2008-04-11T06:54:00.000-08:00

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.

Real Estate "Spring" Starts Early

2008-02-22T06:54:00.000-09:00

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.

City Tax Assessments Mailed; Values Fit with Market

2008-01-20T14:23:00.000-09:00

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.

2007 Annual Homes Sales Data Published

2008-01-14T06:03:00.000-09:00

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.

Real Estate on Daily News Sunday Page 1

2007-09-17T07:26:00.000-08:00

Sunday's Anchorage Daily News (Sept 16) featured a front page real estate story:

"Shift in housing market, Higher-priced homes are being slashed, but less costly are few," it headlined. It ran prominently on page 1 and jumped to fill most of the back page of Section A.

The day after the story ran, the on-line edition of http://www.adn.com/ was listing the story as "most e-mailed". The Daily News provides a comment link on its stories; these appear at the end of the on-line edition of the story.

This link will take you there: http://snipurl.com/1qtjg.

Reporter Elizabeth Bluemink (crediting me with some statistical assistance) describes the current market and shows how Anchorage's more active years of this decade have slowed to a pace that feels more like the "normal market" years of the 1990's.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

NY Times Documents National Decline in Home Prices

2007-08-27T05:45:00.000-08:00

The New York Times lead story Sunday reported on an anticipated small decline in home values nationwide. http://snipurl.com/1pzzw. The on-line version includes many links to source material, and a video summary by the reporter.

An interesting comment at the very end is by the National Association of Realtors® former chief economist. He acknowledges being late to join the bears in believing home prices could decline. But he adds that the pessimists were much too early when they cried chicken little at the beginning of this decade.

The report also notes that for most people a fluctuation in the value of their home in any particular community won't have much impact on a single family's household economics. The real significance is that a leveling of home values nationwide will be a drag on consumer spending that has in the past been driven by borrowing against increasing home equity.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Market Tilts Gently Toward Buyers

2007-08-16T14:51:00.000-08:00

Signs have emerged that we are in a market that has become tilted toward buyers in the past 18 months, but not dramatically so. The continuing evidence is in statistics from Alaska MLS, Inc. from July just published.

Inventory stands at 1378 homes for sale, more than any July since 1999 but consistent with inventory levels through the 1990 decade.

Inventory for 347 homes in the price class of $350,000-$500,000 rose from 6.4 months to 7.4 months in just the past 30 days. In the next bracket, to $750,000, inventory rose from 8.6 to 10.2 months. Less costly homes have less inventory. There is a larger supply of more expensive homes, with the million-dollar properties showing two years and four months supply.

Total reported closed sales are down 7.0% compared with the first seven months of last year, and down 15.1% from two years ago, same time period.

But the average sales price through seven months is 4.75% above last year's 12-month average value. This means prices are up about that much from this time last year. That is certainly less appreciation than 7.88% from 2005 to 2006, and double-digit inflation in each of the two years prior to that.

So prices are not falling, but sellers with unrealistic expectations are adjusting, or dropping out the market. "Price reduced" is the theme of our market. This adjustment of expectations is also evidenced by the gap between the last listed price and ultimate selling price. It has increased from 0.7% to 1.7%.

Market times of sold homes year-to-year '06 to '07 rose from 42 days to 62 days.

The world is not ending, contrary to what's being reported from Wall Street, but we have a normalizing market in Anchorage:

It will take some mental adjustments by sellers to accept that selling a home is going to take a more normal amount of time, and will only happen with pricing that positions a property to be the best value of its type.
Buyers, while they are pleased to encounter more seller flexibilty and available choices, still have to accept that property values are rising and that they cannot dictate a deal on their terms alone.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Home Values up 8.1%

2007-05-18T14:14:00.000-08:00

Home values for sales reported to Alaska MLS, Inc. through April 30 show the average sales price is 8.1% higher than the sales during the same period last year. This is a comforting contrast to news of housing issues in parts of the Lower 48.

The number of homes sold is off 6.6% and inventory stands at 1014. This is about twice as many homes as were for sale during the last five years of a housing shortage, but still short of the more normal market of the 1990 decade.

Market times are longer, and now more normal, 71 days. Last year it was 48 days for homes sold in the first four months of the year.

The gap between "last-listed" and selling prices is also back to normal: 2.1% as opposed to 0.6% last year.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Home Price Increase Continues

2007-04-16T11:40:00.000-08:00

The price of an Anchorage home continued to rise in the first quarter of 2007. Statistics issued last week by Alaska MLS, Inc. shows an average selling price of $320,787. That's 1.92% over last year's average.

Prices hovered just above and below $300,000 during the last half of last year, ending at $310,132 with the December sales reports.

The appreciation rate for last year was 8.16%, according to updated reports that picked up sales recorded late in 2006 but not reported until this year.

That home prices are continuing to rise is interesting in light of a 7.5% decrease in the total number of sales reported in the first quarter, compared with last year's first quarter. I'm not surprised to see this decline, given the cold months of November and December, which would have been the source of sales reported closed in the first two months of 2007. I take away from this that the winter buyers were still motivated and willing to pay more, given the supply of homes.

These buyers negotiated price more assertively, however. The gap between the last price a property was listed for in the first quarter, and what it sold for in the first quarter, compared with the first quarter of last year, increased from 0.74% to about 2.59%.

This means that even with more price negotiation taking place, values in 2007 are continuing to increase, and at about the same rate as last year. The appreciation rate is only about 2/3 the rate of the first years of the current decade. But it's two to three times the rate of price inflation during all the 1990's.

That there is more price negotiation squares with an increase in the average selling time of Anchorage homes from 49 days to 73 days, first-quarter '06 compared with '07 . Sellers used to hearing about quick sales in recent years get nervous after two months and are more willing to negotiate. Buyers, driven in part by negative press about real estate issues in the Lower 48, have been pressing their offers harder, too.

A final factor in this price escalation is inventory. I wrote you last fall to report that the inventory of homes for sale had increased to about 1200. That followed several years of about half as many or fewer homes for sale. This chronic shortage was a major factor in the higher rates of price appreciation in the 2001-2005 years.

Last fall I was quick to say that 1200 homes for sale, while headline grabbing at the time, hardly represented a "glut". All through the 1990's we typically had 1300-1400 homes for sale, and then a smaller population base and lower total housing unit count.

My other observation last fall was that a substantial number of the 1200 homes for sale consisted of what I called the "wanna-be seller". This is the household that was saying "gosh, if my home is worth that much, maybe I'd be willing to move". That wished-for price was often 'way above-market and produced a listing I believed would never sell.

As I predicted, those wanna-be's didn't sell, and dropped out of the market over the winter. I foresaw an inventory decline to about 2/3 of then-prevailing levels. That prediction proved right-on: the September count dropped from 1234 to 855 at the end of the year. As of the end of March the total inventory of new and resale homes stood at 933.

To summarize:

We have a normal market, one that is stronger and more healthy than some markets outside Alaska that are correcting after a period of intense speculation -- and even fraud -- that we did not experience.
The market is somewhat stronger than what we considered "normal" through the 1990's. It might normalize somewhat further toward those levels as the year goes on.
The 2000-2005 market, while go-go by Alaska standards, still lagged many Lower-48 markets. Today an average home is closer in price to the average US home: we aren't a high-cost market by comparison with at least half of the rest of the country.
A seller today, given longer selling times, should plan a measure of patience in the marketing plan. When prices are rising, one doesn't have to panic if there isn't an offer on the property in the first month. Be prepared to compromise more in the eventual negotiation, however.
The buyer who waits to make a purchase, thinking wrong-headedly that "prices will continue to fall" will end up paying more later this year, or next year. Rising interest rates will compound that higher cost of home ownership for these shy home buyers.

For full property searches, virtual tours and many other Anchorage real estate resources, visit http://www.reals8.com/.

Homes-Listed Inventory Levels

2006-10-07T12:39:00.000-08:00

The number of homes listed for sale in Alaska MLS Inc stood at 1202 at the end of September. This is the fourth month in a row that the inventory has come to rest at this same level.

There was a surge of new inventory beginning in late spring. The number of homes for sale has doubled. Everyone's been talking about it. We are still a couple hundred listings below what was "normal" in the decade of the 1990's, however. I would characterize the current decade as an abnormal market.

A reporter asked me yesterday, in connection with the interview I did for Channel 2 news, if there are more buyers than sellers in the market. I'm not sure how to measure that. But I would interpret the leveling of the inventory as a sign that buyer demand and seller supply are back in balance.

There's usually a decline in inventory during the winter. There are a fair number of "wanna-be" sellers with overpriced property listings out there. If they don't achieve their unrealistic objectives this month, many will give up.

Sellers who want to create a sale face less competition during the dark months. Buyers at that time of year can expect to find good values then, too.

Right now is actually a good time for the value-conscious buyer. Good properties are still available; not all the best properties have been chosen. A buyer who deals with a seller who is committed to creating a sale before winter can be pleasantly surprised.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

August MLS Reports Show Balanced Supply/Demand

2006-09-16T13:01:00.000-08:00

August reports just published by Alaska MLS Inc. document the continuing trend toward normal market conditions.

The number of sales contracts inked for existing and new construction homes and condos is off 6.5% compared with last year. This represents a return to historic levels of property turnover since the current long-term market recovery began in 1990.

The number of homes for sale (not including condos) stands at 1197. Inventory was at 1100-1300 all through the 1990's.

The existing inventory is fresh. Much of the increase from the chronic short-inventory levels of the past six years -- when only 500-600 homes were for sale in most months -- came to the market this summer. This is evidenced by the current listing inventory showing only 60 days marketing time, compared with last year's 610 homes for sale showing 96 days-on-market.

How long it actually takes a home to sell is what's important to sellers. That has hardly changed in recent years: 46 days for year-to-date sales in 2004 and 42 days for the same time frame last year and so far this year. Homes that experience exessive marketing time, over 90 days, miss the market's enthusiasm for fresh listings and become shopworn.

With demand relatively constant, and supply returning to normal levels, price appreciation has moderated accordingly. Compared with double-digit appreciation rates in recent years, 2006 is showing signs of about 6%-7% inflation. (Nothing suggest a decline in value.)

The average home in Anchorage now prices at about $325,000. Absorption calculations compare the amount of inventory with the rate of sales. For homes priced at the average low-$300,000 level, MLS estimates there is about a five month supply.

Supply of four to six months is an indicator of a balanced market. More than that -- such as the eleven-month supply of homes priced above $500,000 -- suggests a buyer's market. Less supply -- such as the 2.4 month supply of homes priced under $250,000 -- indicates a buyer's market.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

ADN Real Estate story -- Reaction from Ken Gain

2006-09-11T10:28:00.000-08:00

Ken Gain is a respected long-time real estate licensee who has just about every credential one could imagine. Here's his reaction to the Daily News story published yesterday, posted here with permission:

"What I see is what statisticians refer to as "reversion to the mean". The market is still very strong and in my opinion is a much healthier market because it is forcing both buyer and sellers to negotiate and use sound judgment. Balanced markets are, in my opinion, always better than buyer's markets or seller's markets. I was somewhat concerned over the last several years where people who really understand little about real estate or markets in general were wrapping them selves in the cloak of infallibility by pronouncing that "you can't go wrong with real estate". Fortunately, we didn't see a huge upsurge of investor purchases of homes that occurred in many markets. You can be certain that when properties are purchased only in anticipation of flipping them in a short time, rather than occupying or renting them, that a significant correction is only several years away. A market based upon the "greater fool theory" is a dangerous market. In summary, I believe that the recent cooling of the market is very good for everyone."

Ken Gain, PresidentCA$H NOW Financial Corp.Phone (907)279-8551Fax (907)274-7630 Website--http://cash4you.net

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Daily News Real Estate story

2006-09-10T20:10:00.000-08:00

Here's the link to the page one story about the Anchorage real estate market that ran in today's Anchorage Daily News. I thought it was a fair and balanced report: http://www.adn.com/news/alaska/story/8178223p-8071036c.html

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Are foreclosures on the increase in Anchorage?

2006-08-30T11:21:00.000-08:00

I have been wondering whether foreclosure rates are rising. In recent months I seem to be receiving more properties from institutional owners after they foreclose on them. It could be another sign of a market that is making a transition to more normal conditions.

I'm not seeing a glut of foreclosures. A small proportion of any loan investor's portfolio will fail to perform, no matter how strong a market is.

None of these properties is from Alaska Housing Finance. They are a more conservative investor, with a reputation for higher property standards. Delinquency rates for homes financed by AHFC, an early indicator of the health of any loan portfolio, rarely top four percent. AHFC only forclosed on 19 properties through July this year, compared with 18 for the same seven months of last year.

AHFC's multifamily loan portfolio, by contrast, showed a 3.70% delinquency at the end of July, compared with 2.07% in July, 2005. All through 2005 loan delinquency in the AHFC multifamily portfolio was at the low two percent level. This year it's been over three percent in four of the first seven months of the year.

Other more adventuresome lenders, by contrast, may have more of their loans getting into trouble. That could explain why I'm marketing more foreclosed homes and small income properties now.

By the way, I publish upcoming listings, including foreclosures, on the front page of my web site at this URL: http://www.reals8.com/index.html#comingsoon. There are some asset management sites that show me as the upcoming marketing representative on their properties, too. This is often weeks and sometimes months ahead of the property being cleaned, appraised and otherwise made ready for market, with a list price and available for offers.

So I make it my practice to note the names and phone numbers or Email addresses of anyone who wants to know about these properties on the first official listing day. I'm diligent about this. Such people have taken the trouble to let me know of their interest, so it's just professional courtesy, I believe, to see that they get the earliest opportunity.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

July Market Data: More Homes, Constant Demand

2006-08-16T13:44:00.000-08:00

Alaska MLS, Inc. published its July reports today showing that 1105 homes were for sale at the end last month, more than any July since 1999.

Through the '90's we had about 1200-1400 homes for sale. In recent years the housing shortage has given buyers only about 600 homes to choose from.

Demand is relatively constant, however. Closed sale reports year-to-date are down only 4.6% compared with last year, and 6.3% under 2004.

Prices continue their upward trend. The average sale price this year $309,824. This is about 6.5% above the average at this time last year. Higher mortgage rates -- 30 year loans are pricing about a half-percent above last summer -- have added to the cost of home ownership.

Mortgage costs and purchase price are combined with utilities by the US Labor Dept. for the housing component of the Consumer Price Index, which they reported this week went up 4.2% in Anchorage last year.

So consumer demand seems constant but the cost of home ownership continues to rise. With more homes to choose from, however, buyers may take longer and the time it takes to sell a home may increase somewhat. So far that's not happened: 43 days is the average selling time for the 1720 sales so far this year, the same as last year and four days less than two years ago. Nationally marketing times of 60-90 days are considered normal.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Fear Reaction to BP Prudhoe Bay Closing will be Brief

2006-08-08T07:29:00.000-08:00

The news of BP closing Prudhoe Bay oil fields while the firm replaces corroded feeder pipelines will startle the real estate market here, at least briefly. Uncertainty always first triggers a fear reaction. In real estate this means buyers will hold back from the commitment of investing in a home, or making a decision about commercial property.

Then things sort themselves out. In the interim, demand just builds. People die, change jobs, get married or divorced, retire, have kids. Businesses expand, contract, or change mission. Their housing needs and business real estate requirements are still there.

So at some point everyone gets going again, and makes their purchase, or business leasing decision. Those become very busy weeks for us real estate folks.

I would predict the impact of this news from BP will be brief. People will quickly appreciate that economic activity and corporate spending that impacts the Alaska economy is good for the real estate market. BP's new project at Prudhoe Bay will be a very significant reinvestment of capital.

As one of my friends within the oil industry, puts it, "Once the market recovers from the initial shock of the news, I think you'll find that there is going to be significant activity. Replacing the oil feeder lines at Prudhoe Bay is no small task and will require an army of workers together with some high powered help from the Engineering contractors. That together with the rest of the Alaska activity is going to keep the economy strong for some time to come."

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage homes for sale top recent records

2006-07-20T15:18:00.000-08:00

Anchorage’s summer market sees more homes for sale at this time of year than any year since 1999. Although the number of reported sales has declined year-to-date by 4.8%, prices continue to rise.

The average selling price of a home in Anchorage crossed the $300,000 line in April, a first for Anchorage. The average sales price in June was a whopping $340,175!

Homes are still selling in 45 days, about the same as the past four years. The average gap between the last listed price and the closed sale price is the narrowest it has ever been: 0.56%.

These facts suggest that market appreciation may still achieve double-digit levels this year. It’s been 9%-12% in each of the years 2001-2005. So far this year our average price is 5.95% above the end of last year. We can’t have short market times and homes selling very close to list and not believe that demand still outstrips supply.

It is refreshing, however, to see more inventory. Total homes listed for sale through MLS have been in the 500-600 range since late 2000, even dropping below 500 a few times. Now we have just seen a surge of 654 new listings in June to bring the month-end total to 963.

If there is a soft spot in the market, it’s upper-end homes. The million-dollar home used to be unusual: now there are 25 for sale. But with only one or two a month selling, this inventory constitutes a 21 month supply. The inventory of homes from $750,000 to $1 million is 14 months. By contrast, under $250,000 there is only a two month supply.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Upper End Inventory in Oversupply

2006-06-27T17:46:00.000-08:00

As of today there are 76 homes for sale from $700,000 to $1.5 million. In the lower half of this range the rate of home sales for the past 12 months has been three per month. Above $1 million the average is one per month.

This works out to available inventories of just about 17 months and just over two years, respectively. By comparison, the supply of mid-range homes, $350K to $750K is about six months. Below that range, the supply is only one to three months at best.

The good news is that the upper-end homes that have sold have enjoyed relatively brief marketing times, often under 90 days, and less than a month in several cases. This means that a large portion of the inventory is not reasonably priced. However, the home that is priced at market will sell.

Those that languish will end up selling for less than they would if correctly priced at the outset. Sadly, some other more optimistic sellers will altogether withdraw from a market that has rejected their properties.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Property Tax Payment Due June 15

2006-06-08T07:14:00.000-08:00

This year my wife and I won't forget to ask each other whether one of us paid the first half property taxes! Judith and I did forget one year, and to our chagrin learned that the penalty is 10% of the payment amount, several hundred dollars in our case. There's interest on the unpaid amount, too.

Most people have their property taxes paid from their lender's escrow account, so no worries. But if you don't have an escrow, you have to remember to pay that first half tax bill with a check mailed by midnight next Thursday, June 15. (They don't have to receive it, just have it postmarked by then.)

If over the years you have built up a substantial equity in your property and there is still in place an escrow for taxes and insurance, consider asking your lender to excuse you from it. Assuming you are a good money manager, pay these bills yourself when they are due. Otherwise you are simply making your lender an interest-free loan of more than enough money to cover these expenses!

If you closed a purchase or sale this year it is likely that the taxes were paid for the year at that time. There would have been a proration between buyer and seller. Don't forget to write off your share when you do your taxes next year.

Don't bother with the options of paying by direct debit, or credit card. They charge 3%, more than the cost of just buying airline miles, if that's your motivation.

These and other FAQ's are on the MUNI's web site at this location.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Niel's Web Resources Enhanced

2006-06-05T06:47:00.000-08:00

I'm offering enhanced resources for sellers, as well as buyers, on my web site. "What's My Home Worth" is especially popular. Owners can get an EMail valuation. The Seller-oriented page is here.

The equivalent page for Buyers is here.

People tell me the Anchorage Real Estate Podcast, a short on-line radio interview on market conditions, is a first for Anchorage real estate information. And the push-to-talk-to-me button is popular: even my mother in Vermont uses it.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Building Permits Hold Steady

2006-06-05T06:45:00.000-08:00

The MOA Building Safety folks report 164 new home permits issued through April this year, the same as last year. In 2004 and 2003, however, the equivalent permit level was about 50% more, around 250 each year. Land use permits for Eagle River totaled 77, the same as last year.

The MOA's system for reporting remodeling permits was changed this year to include everything that requires a permit, such as replacing a water heater. Now it is not as easy from their reports to track whether larger-scale remodeling activity is up.

From industry contacts and conversations with contractors, however, it does appear that more people are undertaking to update and even expand their homes. This could be attributed in part to fewer new homes available. But also we have a large number of homes that are now 25 years old from the early 80's building boom that are in need of modernization.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Home Sale Prices Top $300,000

2006-06-05T06:40:00.000-08:00

The average year-to-date selling price of a home in Anchorage has just topped $300,000. At the same time last year it was a little under $270,000. By contrast with the Lower 48, however, Anchorage homes are less costly. Average home values in many equivalent markets are closer to $400,000 at this time.

The year-to-date total of closed sale reports reaching Alaska MLS Inc. through April is lower this year: 822 vs. 899. These are reports of contracts agreed to a month or two earlier in most cases. The data through May should be available in about two weeks.

Meanwhile, the number of homes listed for sale at the end of every month this year has been higher than most years since 2002. For the past four years the springtime inventory has been around 500. This April the inventory rose to 622, higher than any late winter and spring inventory levels since 2001.

Given that prices are continuing to rise, I would say that inventories have not yet reached levels where supply exceeds demand.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Homes by Email

2006-05-13T21:07:00.000-08:00

No need to contact a real estate licensee to get daily reports of homes for any profile you specify, straight to your Email inbox. Use this link.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Quick and Easy MLS Access

2006-05-13T21:06:00.000-08:00

Find all the MLS listings in one place, no hassle access. The same database, the same listings, that all the real estate licensees work from. Use this link.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Unrepresented Owner?

2006-05-13T21:01:00.001-08:00

Trying to sell a property without professional representation? (FSBO) Please a free web ad, with no licensee involvement or representation. Buyers will contact you directly. Use this link.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Free Home Sale Preparation

2006-05-13T21:01:00.000-08:00

If you are planning a home sale anytime soon, get the free web-based presentation to prepare you for the process. You can also order the CD version, with many interactive features. Use the links at the top of this page at RealS8.com.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

What's My Home Worth?

2006-05-13T20:56:00.000-08:00

Get an analysis of your home's worth e-mailed to your in-box, without even the need to call me, or any real estate licensee. Use this link.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

MLS Annual Statistics Posted

2006-05-13T19:43:00.000-08:00

MLS came out with its annual market statistics for 2005 this week. While none of the market-wide reports carry any big surprises, there are some factoids deeper in the data I found interesting:

The average selling price of the 132 new and existing homes in the south part of Hillside last year was almost $550,000. This represents a whopping 16.2% price increase over 2004 and 34.8% above the end of 2003.
The average time on market for a resale home, or a condo, in Anchorage was only 32 days, the shortest in 11 years. (In 1994 the average was 71 days for houses, 106 days for condos.)
Existing homes in Anchorage posted a 13.0% gain, compared with 17.3% for new construction. This reflects the increasing shortage of buildable home sites, and dramatic increases on the cost of construction materials. The blended rate of increase of both existing and new homes, 3261 sales, was 12.51%.
There were 11 homes sale reports over $1 million, compared with seven in 2004. Three of the 2005 million dollar homes were new construction; only one was in 2004.
Seven percent of the 3261 homes sold in 2005 were above $500,000. The year before the proporation of half-million dollar homes was only 4.52% of sales. Five years ago, in the year 2000, only 2.3% of homes sold were priced above even $400,000, the top price bracket that MLS tracked before 2004.
New construction condo sales surged to an average selling price over $200,000 for the first time in history. The average was influenced by the construction and sale of 39 new condos in several projects downtown with an average selling price of nearly $354,000.
With the advent of site condo construction in 2001, MLS has reported between 411 and 471 new construction condo sales per year until last year. Suddenly the total last year jumped to 577 new units.
The gap between last price an existing home sold for and its listed price at the time last year was 1.0% compared with 1.5% in 2004.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Market cools, good values emerging

2006-04-17T16:19:00.000-08:00

As the Anchorage home market cools somewhat, better values are emerging for those who are prepared to shop carefully. This is the time to be aware of the true value of a home before making an offer to purchase, however.

The market slowed over the winter, when fewer homes went under contract than normal. We rebounded in March to a little under last year's level, but the slow winter meant that closed sales reports reaching MLS have lagged. Through the first quarter there have been an average of 621 homes reported sold for the past five years. This year's January-March report shows only 574 homes sold.

The inventory of available homes has grown somewhat. Where there were 503 homes available at the end of March last year, now there are 561 on the market.

Overall price levels are certainly not declining. Last year a home in the Anchorage bowl carried an asking price of a little over $387,000. Now it's almost $403,000. Eagle River prices are $22,000 more; Chugiak is about $10,000 above Anchorage.

Sellers are making deals, however. There are more "price reduced" signs and ads running and homes are not just sitting. Indeed, the average time on market for homes in the Anchorage bowl last year at this time was 93 days. The current inventory shows a market time of 59 days.

If a seller by reason of birth, marriage, divorce, death or job change has to create a sale, he or she will do what it takes. If the initial asking price doesn't produce a sale, the price comes down to market quickly. That's why throughout the MLS system sellers achieve over 99% of the last price listed in the eventual sale price.

I've just published the MLS first quarter statistics from which this post is gleaned. Use this link.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Slight Sales Decline in Early 2006

2006-03-17T06:09:00.001-09:00

I've just posted real estate statistical reports from Alaska MLS Inc. showing market activity through February. I'm watching the data closely this spring for signs of any market slowdown.

It might be a stretch to divine any weakening of market activity from the early data. Closed sales reports for February and January reflect deals that were done late last year. A better early indicator is the number of transactions that were showing as pending at the end of January and February.

This year the pending file is in the low 200's. Last year it went from a little under 300 to just over 300 by February. Two years ago it was about the same as last year. So there have been fewer property sales so far this year.

This has not been accompanied by an increase in the number of homes for sale, however. At this time of year there have always been a little under 600 residential listings in MLS. The inventory stood at 558 at the end of last month this year.

The average sales price topped $310,000 for the first time ever on a year-to-date basis. The average price for last year on one report -- MLS has not yet published comprehensive year-end data -- was $291,013. The February closed sales average $315,751.

That preliminary average sales price for last year is an increase over 2004 of 12.13%.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Your home value: the buzz about Zillow

2006-03-02T06:33:00.000-09:00

A web-based home valuation service called zillow.com has been receiving much buzz around the country. You just type in your address (or anyone else's) and it returns an estimate and maps.

Some of the buzz is coming from fearful real estate agents who wonder if such a tool threatens their business model. (Some go so far as to hope they don't enhance the buzz by using the word Willow in their on-line posts.)

To the extent that their business model is based on being the gatekeeper to real estate data, perhaps it does. For those of us who moved long ago to being the trusted adviser and the interpreter of data, it does not.

Zillow's estimates in Alaska are probably just an extrapolation of property tax data. If you use the Zillow function to ask about comparable sales here, the site replies there are none. After all, there is no law requiring property sales to be reported in public, or to taxing authorities. Mass appraisal techniques lead to assessed values, which are often uneven for individual properties.

Zillow's graphing function in the case of my home produced the amusing assertion that it went up in value since last summer from about $334,000 to $396,000. To the extent that I trust myself as a "trusted real estate advisor" I'd question where this comes from. I would also trust my advice that with only a single garage, the home isn't worth this much now, even though the location is superior and the home is remodeled and well-maintained.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Economic Forecast slides available

2006-02-04T13:56:00.000-09:00

Every year in January all us real estate pundits come out with our real estate and economic forecasts. There is a sucession of luncheons. I was the presenter at the Anchorage Board of Realtors event.

Similar events in January are by the Building Owners and Managers (BOMA) chapter, Anchorage Economic Development Corporation (AEDC, which had Robert Reich as its headliner).

I've posted links to each of these presentations on my site on this page.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage Indicators reports published

2006-02-04T13:53:00.000-09:00

Anchorage has now updated and published their popular set of economic indicators. They call it the Neighborhood Sourcebook. The page is off the link in the previous sentence. Check it out, it's very comprehensive.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Housing Bubble Won't Happen in Anchorage

2006-01-13T08:36:00.000-09:00

Here's a link to the Anchorage Daily News interview with me today: "Balloon in real estate won't bust, agents say".

The story quotes material from my presentation at the Anchorage Board of Realtors annual economic and real estate forecast luncheon Wednesday of this week. I'll post the pertinent slide to my main web site if you would like the details of the data.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Residential sales prices up 11.5% year-to-date

2005-12-17T08:07:00.000-09:00

MLS reports for November show an 11.5% average reported sales price for the first 11 months of this year, compared with all of 2004. The monthly reports show November sales at $297,163, down from the monthly reported sales that peaked at $305,530 for August.

This may not reflect an overall market decline, however, because higher-cost new construction jobs were probably part of the mix to a greater degree at the end of the summer. At this time of year one would expect to see more resale properties. There is also a certain amount of discounting that happens now by owners who want to get a property sold and not carry it through the winter.

However, there has not been a pattern in past years of values peaking in late summer, followed by general price declines on a monthly basis in the fall.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com. The site includes the detailed reports of market data referred to in this post.

Anchorage at 90

2005-11-03T06:23:00.000-09:00

"Changing Fast, with More to Come" is the title of a terrific report from the University of Alaska Institute for Social and Economic Research. I've noticed a revitalization of this research arm at the university since Fran Ulmer recently took over after her unsuccessful run for Governor.

The report looks closely at the 1990 census data and extracts a profile of the city and its changing demographic profile. Its conclusion begins:

"Anchorage at 90 looks surprisingly like other U.S. cities, given how recently it was still a frontier town. It has an aging white population, a young and diverse minority population, and a growing number of residents over 65. Many of its minorities, single mothers, and older people living alone are clustered at or near poverty levels. Fast growth in housing prices is prompting many residents, especially families, to move outside the core city and creating a burgeoning commuter population."

Download the full report from the link in the first paragraph.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Oh, no, HE'S BACK!!

2005-10-31T07:09:00.000-09:00

The latest is that HE'S BACK! Last night I looked out the window before going out with the terriers for "last pee's and wee's and night-night treats" (always have to, given the number of predators I live with here) and THERE HE WAS, CHOWING DOWN IN MY GARDEN!

Enough already! This is not a porcupine hotel, motel, or Royal Fork restaurant!

Now he knows where he thinks he lives so as I run out (with terriers locked up) with a pole to make him ball up so I can catch him, and garbage can in hand. He races (didn't know they could go that fast) under the shed. So back we are, my wife and I, with the same eviction routine with the fully-extended window washing pole and rake. Fortunately after not too much effort the silly creature runs out from under the shed right into the garbage can that's lying on its side waiting for him.

Now this time it's off to the thousands of acres of state park up a long twisting road about five miles away. "Find yourself somebody else to freeload off of!" he's told.

It's "three strikes and you're out" around here. Next time he gets shot. My wife says porcupine belly is good eating.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Evicting the tenant from Hell

2005-10-23T19:15:00.000-08:00

This is sort of real estate story. File it under landlord-tenant relations.

Anyone who has been a landlord dreads the occasional tenant from Hell. One such moved in on me yesterday.

A pocupine trapped under one's shed, and two terriers, is not a happy combination. After a quick trip to the vet to get facefuls of quills removed, I returned to evict my unwelcome tenant.

How do you chase out a pocupine from under a shed that's 15 feet long and only about six inches above the ground? Like the vet said, when I asked him how he managed to neuter such a creature for the Alaska Zoo, you do it "very carefully".

A pocupine when challenged just rolls itself into a ball. But with the window-washing pole extended full-lengeth it was possible to shove and prod him to the the other end of the shed. Then running around the building with a rake, quickly before he moved farther back under, I dragged him out into the yard.

There he crouched in a ball. Silly creature. I just plopped a garbage can over him. Then I shoved the lid under the can and righted the now closed can, safely covered over. Lastly, it was down the road to show him off to the neighbor children, who then trooped after me to our neighboring 50 area undeveloped tract where we could let him go.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage homes more affordable, says national study

2005-10-13T16:33:00.000-08:00

Coldwell Banker has done an "apples-to-apples" study of housing values since the late 1980's. The Home Price Comparison Index calculates what the same house is worth in different markets. This year's study ranks 319 US markets. Anchorage ranks #170, about in the middle. The index rates a typical middle-management 2200 sq.ft. 4 bedroom 2.5 bath house that has a family room and double garage. At $305,107 this Anchorage home is only 76% of the cost of the US Average home of this type, however.

This is a useful study for anyone who plans a move from or to another community. E-mail me, NThomas@RealS8.com for the full study.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Buying from an institutional owner -- you need fortitude!

2005-03-31T06:25:00.000-09:00

"It takes fortitude," said Anchorage Opera's former director when I told him I wanted to see the entire Ring cycle by Wagner.

The same can be said of you if you want to buy a property from an institutional owner. These include bank foreclosures and homes taken into inventory by relocation companies.

I get the assignment to market these properties on a regular basis. So I see what buyers go through when they develop an interest in them.

It's frustrating for these buyers who are used to dealing with live sellers in our market. They expect an answer right away, and don't want to mess around with lots of paperwork.

It just doesn't work that way with institutional owners. They can take days to answer. I've got one deal in the works now where the owner, for understandable reasons, was nearly a month answering the offer.

The paperwork can be impressive. On the one hand, institutional owners usually give out an Alaska disclosure form that says they don't know doodely about the property. At the same time, as their representative I may have accumulated lots of stuff, like the entire file of public records on the well and septic systems, for instance. Part of the purchase process involves the necessity to review and sign for all this information.

There is almost always a seemingly baffling multi-page form from the institutional owner that sets forth their own rules of the transaction. It's in the nature of a counter offer and you need to read the fine print: there may, for instance, be a daily penalty for not closing on time.

These contract provisions may vary from local practices. You can try to negotiate away something that simply doesn't work for you, but understand that these clauses are written for use all over the country. The people who handle the process are usually busy asset managers and relocation company counselors. They are often not inclined to cater to your individual preferences in Alaska.

It takes fortitude. On one property I've marketed this month we sold it twice and never got it all together because in both cases the buyers got mad when they didn't get an answer right away and they walked away. Too bad for them: on the third go-around I had four offers and somebody who was more patient is getting a pretty good deal.

That's the end benefit of buying this type of property. With a little care -- and competent professional assistance -- you can come up with some pretty good deals. Unlike a private seller, an institutional owner has no motivation to hold a property indefinitely. It's for sure in a "must sell" mode.

Termination and Default -- What's the difference?

2005-03-03T19:25:00.000-09:00

A new purchase and sale agreement has come in use in the Alaska market this year. It makes many improvements. One such improvement answers questions that always come up when the buyer or seller don't do something the contract calls for.

The new agreement frequently uses the word "terminate". For instance, if the seller fails to accept the offer by the day and time the buyer states in the offer, the offer terminates. If the offer has been agreed to and the buyer fails to produce a letter from the lender that verifies the buyer's qualifications, the agreement terminates. If the buyer and seller fail to agree on a buyer's or a lender's repair requests by the stated date, the agreement terminates.

Nobody has to do or sign anything when an agreement terminates. The deal is off and the buyer's earnest money gets refunded.

Default is a different matter. The rules are different for buyer and seller.

A buyer is in default if he or she fails to tell the seller that the lender won't meet the agreed date for granting a loan commitment. A buyer is in default if after obtaining a commitment he or she doesn't close.

A seller might be in default if the seller doesn't close without good cause.

If a buyer is in default the seller gets the earnest money. By contract the buyer and seller agree that this is the entire remedy for a buyer's default. The seller can't pursue a claim for other damages, or get a court order requiring the buyer to close.

By contrast, if a seller is in default, a buyer would have the right to seek specific performance.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage home and condo values surge 10%

2005-02-16T16:13:00.000-09:00

Alaska MLS Inc., (where I was Past President last year) published its annual statistics yesterday. These numbers are widely-quoted because of the size of the database and reliability of information furnished by real estate licensee members statewide. The complete reports can be reviewed from this link.

How much did Anchorage houses go up last year? The MLS report for 3328 reported sales of new and existing homes in 2004 was 10.13%. This closely matches the Assessor's recent report of tax values increasing by 11%. The average closed sale price was $259,883, the first time in history that the average Anchorage home price has topped a quarter million.

The average number of days-on-market was 46, beating the previous low record of 49 in 2002 and only the second time in ten years that homes have sold in less than 50 days. These market-time data includes new construction, which often gets listed when the builder pulls a permit, or even at the design state. Isolating resale homes produces a market time of 34 days, again a 10-year record.

Anchorage home price appreciation has made $300,000 homes worth $400,000 in about 4-5 years. I think of "nicer, more costly" homes starting at $400,000 now. Of all existing home sales in 2000, only 1.6% sold for more than $400,000. By last year, 8.4%, 224 homes sold above that level. From 39 "high-end" sales in 2000 to 224 in 2004 is almost a six-fold increase! The difference in new construction is more pronounced: in 2000 only one in 18 new homes cost over $400,000. By last year one out of every five new homes (not including condos) cost that much.

New condos seem to have hit a value plateau. The surge of site condo building began in 2001 when the number of units quadrupled to the mid-400 level per year. Average prices rose as much as 10.7%, in 2003. Then last year the average price held steady, a 1.3% drop, actually. Meanwhile, existing condo values continue to rise at over 10% per year for over 900 sales per year, including last year's 989 sales, a new record total, with appreciation at 10.1%.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

AEDC Predicts Continued Economic Growth

2005-02-13T16:47:00.000-09:00

The AEDC economic forecast for 2005 is for a tenth year of continued growth. The headline prediction is for 2100 new jobs. This 1.5% increase does not include 2000 additional Army personnel who are moving here this summer. You can get a copy of the excellent and comprehensive report from AEDC at their site, on this page.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Big Transfer of Wealth Coming

2005-02-13T16:35:00.000-09:00

Boomer will transfer $14 billion in wealth in the next 14 year, according to the chief economist for Stewart Title. Ted Jones was a luncheon speaker for a real estate audience last week. He said if inheritance taxes were just 25% the revenue would pay off the entire federal deficit!

Most of this wealth currently exists in the form of conservative investments and liquid funds. How much will be reinvested in real estate as baby boomers acquire more property and diversify their holdings?

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

What is that Dripping in my House?!!

2005-02-13T16:27:00.000-09:00

These past few weeks have been an acid test for roof systems. This question about dripping came from a client who was about to have me put her house on the market and leave the state for good. Instead, she has had to put off her plans and deal with these drips into her living room.

What's all this dripping? It's condensation. Through much of late January temperatures hovered at zero and below. If a roof system isn't ventilated and insulated well, the dew point occurs somewhere in the insulation layer, or under the roof deck. Moisture from the house gets up in the roof cavity and doesn't get out. Ice forms there instead. Then when a sudden thaw happens, like this past week, all that ice melts and finds its way back into the house.

When my client asked a roofing company to diagnose her problem they told her they were getting similar calls from all over town last week.

There's a variety of fixes, some simple and some are a big project. At the most extreme, it is sometimes necessary to remove the entire roof deck. The contractor builds up the roof trusses to create a ventilated cavity above the insulation where it formerly closed.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Beating the Competition for a Home

2005-02-13T16:19:00.000-09:00

It can get very competitive when a nice home is on the market and priced right. I had an out-of-town client who got caught up in competing offers this past week. His was the only offer on the table when I presented it to the licensee for the seller at 5 PM on Wednesday. By the next morning there were two other offers and one more that was said to be coming. We were given until 5 PM that next day, Thursday, to make our "best and final" offer.

The property had sold for $10,000 more than it was listed for just a few weeks earlier. The deal didn't close on settlement day because the buyer failed to get his anticipated job. Now the question became: were we the only ones who had heard that story? If we were, perhaps offering a little above the list price might be enough. If others had that information, at least one of them could be expected to offer at that higher level. On a home in the mid-$400,000 range, $10,000 one way or another might not seem like a big deal to someone.

My client was leaning toward running with the listed price. I counseled bumping it $1500. I was honestly not all that optimistic, and was pleasantly surprised to learn the next day that my folks were the top offer, "but not by much," according to the seller's representative.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Anchorage New Home Construction Down 16%

2005-01-24T11:18:00.000-09:00

New home permits issued by the Muncipality of Anchorage for 2004 dropped by 15.7% from the average of the previous four years. The permit valuation of all residential and commercial permit activity dropped 10.6% compared with 2003.

Single family home permits and duplexes totaled 1028 units for 2004, compared with 1309 for the prior year, a one-year decrease of 21.5%. The 2000-2003 four-year average was 1220 units. Site condos are mostly configured as duplexes and count in that total.

Meanwhile, in outlying areas like Eagle River, where only a land use permit is required, the past two years have seen a 38% increase in permits compared with the three prior years. Considering the land shortage in the Anchorage bowl, it makes sense that more homes are being built a little farther away.

The four-year average for multifamily units is 336, bolstered in part by the high of 622 units in 2003. Last year's total was 552, a one-year drop of 11.3%. Notwithstanding that one-year decline it's clear that apartments are under construction at a fair clip: in the last two years apartments were built at a rate this is double the average of the prior three years.

When you consider the economic activity associated with all residential and commercial building permit activity, however, the reports show an increase. The value of all permits last year was $649.4 million, 6.3% above the average of the previous four years.

These statistical report are found on the Municipality's web site at this address.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Foreclosure Challenges

2005-01-22T17:22:00.000-09:00

A buyer client liked a property they saw today and wanted to make an offer. When I spoke with the licensee representing the seller I learned the property is in foreclosure. It is due to go to foreclosure sale sooner than any sale would close. Most lenders will agree to postpone a sale if they will get proceeds sufficient to be paid off, including interest in arrears and foreclosure costs. Sometimes they will even take a "short payoff" instead of running further costs of foreclosure and marketing.

In the case of today's client, there is another buyer whose offer was accepted before we saw the property, so we are waiting in the wings. If they can't make that other offer work then we might jump in.

The Anchorage real estate market is so strong that it's unusual for a loan to go through foreclosure. There's usually enough equity through market appreciation that a seller in economic straights can sell the property and get clear. When foreclosures do occur, however, I am often hired by the asset managers to market the properties: I have two of them now, one on Division St. and a duplex coming up on 13th. As soon as I hear about one coming up I put it on my web site, Anchorage Real Estate: www.REALS8.com.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Breakfast Meeting: Property Tax Assessments

2005-01-21T21:41:00.000-09:00

I had breakfast with Larry Norene today. He and I served on the old Board of Equalization. Larry has an interesting take on the new exemption that gives owner-occupants a 10% discount off their assessed valuation, to a maximum of $20,000. Larry points out that the actual tax savings is not as much as you would think. This is because when assessed values are reduced by these discounts, the mill rates will go up so that enough revenue is collected to fund the budget.

By the way, you have to apply for the discount, so don't throw out the mailer you received this week. The Assessor's staff will be checking all applications against Permanent Fund records. Whether this is a good use of their time is debatable, so one has to wonder if this is perhaps a false savings.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.

Welcome to the Anchorage Real Estate blog

2005-01-21T20:45:00.000-09:00

Welcome to the Anchorage real estate information blog. I've established this service as an easy way to post current real estate information of general interest. I'll include some thoughts on "best practices" for buying and selling. You are welcome to participate.

For full property searches, virtual tours and many other Anchorage real estate resources, visit RealS8.com.