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pandemic

What words are used to sell homes?

May 20, 2020 By Ryan Lundquist 21 Comments

What words are used to sell homes? Let’s get lighthearted because it’s been intense lately with the pandemic. I thought it would be fun and fascinating to see how many times certain words were used in real estate listings.

Realtors do a great job selling and here are words used in public property descriptions in MLS listings in the Sacramento region. There were 33,884 sales since last year. Some of this is just for fun.

How often were the following words used in home sales?

I hope you enjoyed and even laughed a little.

RESOURCES:

New market video: Here’s my weekly video. I talk through two markets. The future and the present. I also have a woodworking sign giveaway in the video. Check it out below (or here).

Millennial Millionaire Podcast: I was on this podcast recently and the episode is called “Teacher turned appraiser by accident.” Yes, I used to teach Middle School if you didn’t know. This was recorded about two months ago.

I hope this was interesting or helpful. Thanks for being here.

Questions: What stands out to you most about the words above?

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Filed Under: Random Stuff Tagged With: Appraisal, Appraiser, descriptive words, home, house, pandemic, real estate marketing, Realtors, Sacramento Appraisal Blog, Sacramento Market Update, selling real estate, what sells a home, words used in real estate

How will the pandemic shape buyers and sellers?

April 30, 2020 By Ryan Lundquist 8 Comments

How will this pandemic shape buyers and sellers? What will people do differently when it comes to real estate? Here are some things on my mind. What do you think? Please comment below.

Rural areas: I’ve heard data firms and colleagues talk about growing interest in rural areas, so this is something to watch to see if it pans out. The idea is people are craving more space, so they’ll embrace a country lifestyle.

Land: A friend the other day was talking about land on the outskirts of the region. Owning a couple acres for $20K is appealing in light of the idea of having more space. Here’s a list of thirty lots under $50K.

Family & Divorce: Some people may want to move closer to family while other households are going to be splitting due to divorce.

Buyers more sensitive about location & condition: For years buyers have been exhibiting sensitivity to adverse locations and homes that are not in pristine condition. In other words, buyers have higher expectations about what they are buying and they aren’t overlooking the true condition of a home or paying top dollar for junk. I expect going through a pandemic will only inflame this dynamic.

Accessory dwelling units: I’m guessing accessory dwelling units will be more useful and desirable for extra income as a rental, housing family members, helping friends who lost jobs, and working from home. Here are all sales in MLS over five years with a listed guest house (I may do a deeper post on this soon). Some of these properties of course had more of a pool house, but many do have a legit ADU / second-unit / apartment thingy.

Moving out of state: This pandemic may motivate people to finally make that move they’ve been talking about to a different county or state. I’ve heard some locals say things like, “I’m heading to Texas as soon as this ends.” And I imagine some Bay Area residents are declaring, “I’m going to Sacramento when this is over.” Migration has been a trend already, and we’ll see how it evolves.

Home office: We’ve all been having Zoom meetings and figuring out ways to work from home lately. I suspect many businesses will go back to normal, but some may adapt their model. Thus having dedicated space for working from home could prove to be more valuable over time. I don’t know that buyers at the moment are actually shopping with this in mind, but if we see a bigger change in business models this will be something that becomes more important.

Cash out at the top: Some people are concerned about the market changing directions, so we’ll see certain owners try to cash out at the top so to speak. I’m not saying we’re at the top of a price cycle. I’m only saying some people think the pandemic has pushed us or will push us into a new price cycle.

Downsize & Upsize: There are households in need of more space because they’ve learned their home is too small. In contrast, maybe it’s time for some to sell, buy a smaller home, and pocket cash (or invest in hand sanitizer and toilet paper).

Gardens: It seems like everyone and their Mom is either baking bread or starting a garden (except for my house). Thus I expect to see more gardens in coming time when visiting properties. The other day someone asked me if a one-acre parcel would now be more appealing because of all the extra space to start an urban farm. Well, in my mind most people are not looking to have a garden of that magnitude.

No effect at all: Let’s be real that lots of people will come out of this not doing anything differently.

Other: What else? I’d love to hear your take in the comments.

Okay, moving on.

FRESH STATS: 

Like I said last week, buyers are starting to get more used to this market, and this week it looks like pending contracts are on pace again to outpace the previous week (we’ll know more in a few days).

RESOURCES:

New market video: Here’s a fresh market update. It’s 20 minutes and I talk about the future (NOT a prediction video). Check it out below or here.

SAR market event (free): On Monday May 4th at 10am I’m doing a free big market update with the Sacramento Association of Realtors. This will be about an hour and it’s for anyone (not just members). Register here.

Videos this week: I’ve been doing lots of video conversations lately. I figured I would post the recorded ones here in case anyone wants to listen.

4/22/2020 Conversation with Madison Chase Team
4/24/2020 Conversation with Rico Rivera
4/24/2020 Conversation with Jenica Williams
4/27/2020 Conversation with Kristin Cooper

Appraiser John Carlson GoFundMe: John is a well-known appraiser in Southern California and he is going through a difficult time as he was diagnosed with cancer and hospitalized. I invite you to pray for him and donate if you can. See more here.

I hope this was interesting or helpful. Thanks for being here.

Questions: How do you think quarantining will shape buyers and sellers? What else would you add to the list? What did I miss?

If you liked this post, subscribe by email (or RSS). Thanks for being here.

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Filed Under: Market Trends Tagged With: accesory dwelling unit, buyers and sellers, COVID-19, Divorce, effect of COVID-19 on housing market, family, housing market, migration, pandemic, picky buyers, quarantining, sacramento housing market, wanting more space

Are buyers & sellers getting used to the pandemic?

April 22, 2020 By Ryan Lundquist 8 Comments

Quarantine. Wearing masks. Social distancing. It’s so weird that these are regular things now. The world indeed has changed over the past month and so has the housing market. Let’s talk about some new developments.

FIVE WEEKS AGO: About five weeks ago the real estate market started to have a strong reaction to the coronavirus. I look to March 12th as our day of change as that’s when things started to kick into high gear with events cancelling and sellers and buyers backing off the market.

OBSERVATIONS RIGHT NOW:

1) Pendings and listings declined heavily for a few weeks.
2) Pending contracts have begun to increase again.
3) More new listings are hitting the market.

Here’s a closer look at the numbers. These are single family detached homes without condos. I don’t include condos because they’re a different market that can water down the data. If you include them in your numbers, that’s cool.

Here is a look at new listings. There has not been a dramatic uptick, but we are seeing more new listings compared to a month ago (the first week we had sheltering in place). 

SOME CLOSING THOUGHTS:

1) Goodbye cliches, hello experts: In a market like today it forces us to place our cliches, canned statements, predictions, and positive or doomy narratives aside. We simply must look to the numbers to understand the market. When trends change it creates opportunities for experts to arise. It also creates opportunity for credibility to be destroyed by making predictions that don’t come true and getting swept up in every single sensational headline.

2) Other markets too: This dynamic of the market seeming to hit a bottom a few weeks ago is something that is happening in some other areas across the country too as reported by Mike DelPrete in his email yesterday (a must follow). I’ll talk about this more in my weekly video at the end of this week. Please know I’m not saying prices or other metrics have bottomed out. I’m only saying it looks like listings and pendings (for now) have begun to increase again.

3) The future: We still don’t know the future, so I’d exercise caution in saying definitively the market has begun a recovery or rebound and will move forward from this point onward. We need time to see how everything shakes out and we’re still living in the midst of so many unknown factors that could sway the market in many ways. The reality is what we say about the market could be different next week based on new data.

4) Getting used to the pandemic: For now it looks like buyers and sellers have started to get a little more used to this pandemic market, which is evidenced by more pending contracts and an increase of listings lately. It’s possible some of this could be attributed to real estate agents being deemed essential too. Will this continue? Is this a trend we’ll see more in coming weeks? To be determined. 

GRAPHS: I plan to make a tutorial soon on how to make a few of the graphs I’ve been posting. Appraiser colleagues, I haven’t forgotten.

I hope this was helpful.

Okay, moving on:

RESOURCES:

New market video: Here is a fresh market update video. This is 25 minutes and perfect for the background while working. Check it out below or here.

 

Interview with The Appraiser Coach: I did an interview with Dustin Harris to talk about not waiting for sales to see pandemic data. Watch below (or here).

Interview with Brad: I did a Facebook Live Q&A with Brad L’Engle last week to talk shop. Enjoy here if you wish (you don’t need Facebook to watch). 

I hope this was interesting or helpful. Thanks for being here.

Questions: What do you make of the stats above? What are you hearing in escrows from buyers and sellers? If you’re not local, what are you seeing happen in your market?

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Filed Under: Market Trends Tagged With: bottom of market, buyers and sellers, coronavirus, COVID-19, Greater Sacramento Regional Appraisal Blog, housing market, market dynamics, pandemic, pending contracts, Real Estate Market, sacramento housing market, uncertain market

Hot real estate stats during the pandemic?

April 2, 2020 By Ryan Lundquist 31 Comments

I can see the headlines now. “Prices rose despite the coronavirus,” or “The housing market shows strength in March despite the pandemic.” But let’s step back and think critically about glowing stats from March and what they really tell us. I hope this will be helpful. Any thoughts?

Five things to consider about stats during the pandemic:

1) Prices rose last month (technically): If we’re not careful the hot headline can be the median price rose 3.5% last month in the Sacramento region despite the pandemic. In other words, the median price increased from $425,000 in February to $440,000 in March. On paper it looks like the market is fine and moving along without any effect. BUT we have to remember prices in March actually reflect pending contracts from mostly January and February. So sales in March actually tell us way more about previous months rather than March itself. If you don’t believe me, only 2.9% of all sales in March got into contract on or after March 12th (the day we found out Tom Hanks had coronavirus) and only fifteen properties have gotten into contract and closed since the lockdown went into place. So we have very little pandemic data to consider within March sales.

2) Pulling stats too soon: This sounds geeky, but it’s key to understand. Pulling sales stats on the first of the month is way too early because not all sales have been entered into MLS yet. In my experience on the first of the month we’re still missing about ten percent of the sales from March because not all sales have been entered into the system yet. So if we wait about a week instead to pull stats we end up getting a much more accurate picture. I quoted the median price above at $440,000, but that is preliminary and it could easily change based on ten percent of the market not being accounted for yet.

3) What to watch right now: If you want to see the current market, watch what is happening in the listings and pendings rather than recent sales in March. Are listings moving or sitting? Are we seeing more price reductions? Are properties spending less or more time on the market? What is the sentiment among buyers and sellers? Who is gaining or losing power? Has there been a change to the number of listings and pendings? Do sellers have to give more credits to buyers? Are contracts getting bid up? Are contracts falling apart more often? We need to ask these questions in every neighborhood and price range. My advice? Look to neighborhood stats and let the numbers inform your narrative about what is happening in the market.

4) Be objective about data: I find it’s so critical to be objective about prices. What I’m saying is if we’re not careful we can judge a market’s price direction based on what we think should be happening, recent sensational headlines, or even regional trends for pending contracts rather than looking to actual stats in a neighborhood or price range. Appraisers even need to do this. It can be tempting to say prices are declining, but we need to be sure that is the case based on what we are observing in the neighborhood market. Remember, it’s possible to be see pendings and listings start to slough, but that doesn’t always mean we’re seeing price declines at the moment. Could that be coming soon? Yes. But we need to let the data tell the story. Let’s remember the market is changing quickly, so what we’re saying today might be different tomorrow.

5) Upping your numbers game: If you work in real estate I can’t emphasize enough how important it is to be fluent in market trends and to be able to talk through current dynamics so you can offer informed real estate advice. If it’s helpful, I am posting a few YouTube videos each week right now as well as lots of content on Facebook and Twitter. Or let’s set up a Zoom meeting with your office so we can talk shop (local offices are free). My goal is to offer perspective and objectively share the story of the market without sensationalism.

A few closing things:

New market update video: Here is a new market update video from two days ago. This is 15 minutes. Watch below or here. I have some new stuff to share, so be on the lookout hopefully today.


 

Fresh daily visuals: During this pandemic I’ve upped my stats game and I’m finding new ways to visualize how the market is moving. I’m not focusing on prices for now because we don’t have enough data yet.

Side note for appraisers: There are disclaimers being put into appraisal reports that talk about not being able to quantify the long-term or short-term effect of coronavirus, but if we pay close attention we likely have enough data right now to at least talk about some of the short-term dynamics. It’s easy to put boilerplate pandemic comments in an addendum for liability and that’s a really good idea, but what’s even better is our market analysis. Colleagues, would it help to have some tutorials for these types of graphs so you can make them in your market? If there is enough interest I’d be glad to put something together. Let me know.

I hope this was interesting or helpful. Thanks for being here.

Questions: What stood out to you about this post? What are you seeing out there in the market right now?

If you liked this post, subscribe by email (or RSS). Thanks for being here.

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Filed Under: Market Trends Tagged With: Appraisal, appraisals, Appraiser, coronavirus, COVID-19, effect of pandemic, hold listings, housing market during pandemic, less listings, listings, low pendings, March 2020 real estate market, pandemic, pandemic real estate data, pendings, price increases, regional appraisal blog sacramento, Sacramento Appraisal Blog

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