Ever wished for a crystal ball so you’d know what’s ahead? That might, or might not, be a good thing, depending on what you want to know…!

On the one hand, having a crystal ball to look into the real estate market could sure help ease concerns for some folks here in the Birmingham and Shelby county areas. Or would it?

Suppose you’re thinking of selling your home. Would you be more inclined to sell sooner, if, say, the ball suggested values would continue to slide in 2010? What if the ball suggested you’d get more if you wait?

I don’t think we really need a crystal ball to know that home values will rise. Nearly every expert out there predicts they will, at some point.

It’s those last three words that are the kicker: At some point.

Hmm. Does that mean in the next three months? Ten months? Two years? This is where having a crystal ball would be pretty handy.

However, crystal balls are about as plentiful as bumper stickers in Alabama supporting the Texas Longhorns. People ask us questions frequently that would pretty much need a crystal ball to answer accurately. “What is my home going to be worth in a year?” would be one such question.

“What will my home sell for if I list it right now?”

Ahh. There’s a question that doesn’t need a crystal ball as badly to answer. We have good resources we can draw upon to come up with a figure that—more times than not—winds up being very close to actual selling price.

The fact is that if your home ’shows nicely’ as Agents like to say, and is priced where we know Buyers will bite, your odds of selling are promising. And, yes, that’s true even in the tough market affecting so many neighborhoods in the Birmingham and Shelby Co. areas as we plow into 2010.

This might sound ridiculously obvious to some, but the ’shows nicely, priced right’ concept is one we’ve seen trip up a lot of people trying to sell their homes. So, not everyone really understands how important this really is. Or put another way, not everyone really ‘gets it.’

During 2009, we represented Sellers who agreed to price their homes where we suggested. Granted, they weren’t always thrilled with the price we recommended. But they swallowed hard and said, ‘okay.’ Why? Because they needed to sell. Helping ease this frustration was their knowledge that—when they turned around to buy another home—they’d be enjoying the opposite side of the tough selling market, getting a very good deal on the home they’re buying.

We also dealt with Sellers in 2009 who disagreed with us. They felt they had a better idea than we did of what their home would would sell for. And guess what happened with their efforts to sell? Nothing. Zilch. Their homes didn’t sell, despite being on the market plenty long enough to sell. I remember several cases where other homes in the same neighborhood as our Clients’ house sold, and in the general price range we had recommended.

There were some cases where our Client’s home never even got an Offer. We always talk about how important it is to listen to what the market is telling us. Let me assure you of one thing: If a home for sale doesn’t even get an Offer, that’s the market talking. It may even be shouting.

I know one thing for sure about trying to get a home sold in this market. You either have to ‘get it,’ or you have to trust your Agent’s advice. Otherwise, your home is probably not destined to sell.

I think the real question that emerges is: How badly do you want, or need, to sell?

Clearly, there are many situations for folks where—regardless of how the market may be performing at the moment—it’s important to sell sooner, rather than later. Some Sellers who contact us tell us they need to sell as fast as possible, and are waiting for us to tell them what to do to make it so.

These are the people we feel confident we can help.

And no, we don’t have a crystal ball to predict the outcome.

But listening to the market and to your Agent go a long way right now, and will most likely mean you can start packing sooner, rather than later.

David

I asked a group of Realtors who sell homes in the Birmingham and Shelby Co. area recently what their thoughts are of 2009, now that it’s ‘in the rear view mirror.’

While a few Agents reported a strong year last year, most told me they weren’t sad to see ‘09 become history.

We hear conflicting information in the media a lot these days about home sales, and this can even happen when you’re looking at sales in a small, targeted area.

Here are a few statistics from the Birmingham MLS that show trends in 2009, compared to 2007 and 2008. Clearly, the local market was a difficult one for many:

Here’s a look at average sold prices for homes in the area:

And, finally, how long did it take to get a home sold? Here’s a look at that:

While these numbers show a challenging market, people with a lot of years in the real estate business under their belt continue to believe that the market will undergo a gradual change, back to more balanced conditions.

No one knows exactly when that will happen, or how quickly it will occur, but most are confident it will. Some think it’s already starting.

Perhaps 2010 will be the year…

David

Here are a few news tidbits involving home sales:

…Sales in the Birmingham area shot up 46% in November, marking the second straight month of increases over the previous year, according to the Birmingham Association of Realtors. In November, 879 homes sold, compared to 603 in November, 2008;

…November sales of previously occupied homes surged to their highest point nationwide in nearly three years, according to the National Association of Realtors;

…Lawrence Yun, NAR’s Chief economist, sees continued progress in 2010, even as some of the government’s efforts to stimulate the housing market ease. “We expect a temporary sales drop [before] another surge in the spring when buyers take advantage of the expanded tax credit,” Yun said. That “hopefully will take us into a self-sustaining market in the second half of 2010.”

…Roughly 2 million homebuyers have taken advantage of the $8,000 First Time Buyer’s Tax Credit, according to NAR estimates;

…Sales of new homes, however, dropped 11% in November, their lowest level since April (new home sales represent a dwindling share of the market). Bottom line: If you’re looking for a new home, chances are you’ll find builders extremely anxious to work a deal;

Overall, analysts feel the housing market continues to recover from its recent downturn, with the government’s assistance programs getting much of the credit.

If you’re thinking of buying a home in the Birmingham and Shelby Co. area, the market remains very much in your favor, thanks to a large selection of homes to choose from, motivated Sellers, and a continuation of some of the lowest ever interest rates on loans.

Last, but certainly not least, keep in mind that the First Time Buyer’s Tax Credit, originally set to expire November 30, 2009, has been extended to April 30, 2010. The government has also expanded the program to provide incentives for current homeowners who relocate — click here for details.

David

Congress has taken a step many people were watching for, and has extended the $8,000 tax credit for people buying a home for the first time. But the extension also carries a big change that could affect you if you own a home right now and want to buy again.

The credit, which was originally set to expire November 30th, now applies to Sales Contracts in place by April 30th, 2010. Homeowners have an additional 60 days beyond then to actually close the sale.

If you currently own your home and have lived in it for five consecutive years, the extension provides for a $6,500 credit if you buy another property by the new deadline. In the current market where so many homes have lost value, this may help Sellers frustrated over not being able to get an Offer for as much as they’ve wanted.

So … either way, the extension is intended to make buying a home more enticing to a larger group of people. That’s exactly why Congress passed the bill, in a continuing desire to stimulate the housing market.

Another point many buyers are not aware of is the fact that you can still qualify for the credit even if you owned a home previously. The government defines a first time buyer as someone who has not owned a home during the previous three years. So, if you owned a home in, say, 2004, but have not owned your residence since then, you would qualify for the first time buyer’s credit.

The tax credit’s extension and expansion, coupled with such affordable deals and financing on homes in the Birmingham and Shelby Co. area really do suggest that—unless you plan to move again soon—you’re much better off owning, rather than renting, and—if you qualify as an existing owner and have been wanting to move—now’s the time.

David

Getting your home sold in Shelby County is taking longer in some communities and less time in others, while prices have dropped, according to October statistics from the Birmingham Multiple Listing System.

The average number of days on market increased in Alabaster and Chelsea, but fell in Helena, Pelham and Calera:

Click here to see a larger version of the Average Days On Market graphic…

Prices continued a downward trend in October, and substantially so, compared to September:

Click here to see a larger version of the Average Sales Price graphic…

How many homes are selling?

Except for Calera, the number of homes sold in October dropped from September. Chelsea saw the sharpest one month drop, while more homes sold in Calera during October than in September:

Click here to see a larger version of the Number of Homes Sold graphic…

Why the uptick in Calera?

Perhaps it’s the large inventory of low cost housing (both new and resale), making for some very attractive deals for first time home buyers, along with the fact that Calera qualifies for USDA financing (which means loans with no down payment required).

I think these statistics are giving us some important messages.

If you’re planning on buying a home, the market is continuing to work very much in your favor in the Birmingham and Shelby County area. Prices have dropped, inventory is in plentiful supply, and loans continue to be very affordable.

If you’re trying to sell, the message these numbers present is that it’s going to take a lot more than just putting a For Sale sign in the yard.

Marketing plays a more critical role than ever, and must be done in innovative ways if your home is to stand out among all the other properties for sale.

Pricing is no less important and will be a huge deciding factor in how quickly you sell, or if you sell, at all (believe me, we have seen examples of both!).

You may also benefit from an informed assessment of your property’s appearance and condition. With so many homes for sale right now, if your property doesn’t sparkle, Buyers will simply move on to another.

These are some very good reasons for trusting the sale of your home to an Agent who’s knowledgeable about the market here in the Shelby Co./Birmingham area and who knows how to achieve success in spite of challenging economic conditions.

David

Maybe things are getting better.

Pending sales of homes in the U.S. rose in June for the fifth straight month, according to the National Association of Realtors.

For the first time in five years, sales of homes have risen for three months in a row, according to NAR.  Sellers pricing their properties attractively, low mortgage rates and the $8,000 tax credit for first-time home buyers are getting credit for the rise.

New sales statistics give reason to be optimistic about the real estate market.

For a number of market analysts, this trend is better than expected, and gives reason to believe the real estate market will continue to improve.

In the North Shelby county/Hoover area, 787 properties are for sale as August gets underway, according to the Birmingham Multiple Listing System.  391 properties are for sale in the Alabaster, Maylene and Saginaw areas, while 505 are for sale in the Shelby county portions of the Helena and Pelham areas.

Here in the Birmingham and Shelby county area, you can still get quite a deal on a mortgage.  30-year fixed rates have actually slipped some from a week ago.  With good credit, you can get a loan in the very low five percent range, while 15-year fixed rates continue to hover between 4.5 and 5%…

David

Here’s a look at current inventory for the Shelby County and Birmingham areas, as indicated by the Birmingham Multiple Listing Service. To help you with an idea of trends, the numbers in parentheses show the count as of March 9th, 2009 (one month ago today):

Single family, town homes and condominiums available:

Helena & Pelham area (Shelby Co.): 519 (521)
Helena & Pelham area (Jefferson Co.): 59 (58)
North Shelby/Hoover area (Shelby Co.): 739 (701)
Chelsea: 298 (324)
Altadena/Cahaba Heights area: 67 (62)
Liberty Park/Vestavia area: 492 (446)
Alabaster, Maylene & Saginaw area: 373 (372)
Calera, Montevallo & Wilton area: 360 (356)
Columbiana, Westover & Wilsonville area: 93 (89)

Number of homes for sale based on current selling price:

Alabaster, Maylene and Saginaw area:
$150,000-$200,000: 132 (131)
$200,000-$300,000: 90 (86)

Helena and Pelham areas (Shelby Co.):
$150,000-$200,000: 169 (166)
$200,000-$300,000: 127 (124)

Helena and Pelham areas (Jefferson Co.):
$150,000-$200,000: 2 (2)
$200,000-$300,000: 22 (21)

Chelsea:
$150,000-$200,000: 82 (99)
$200,000-$300,000: 118 (120)

David

Here’s a quick look at some current numbers for the Birmingham and Shelby County housing market as we approach mid February, courtesy of the Birmingham Multiple Listing Service…

Number of homes available:

Helena & Pelham area (Shelby Co.): 497
Helena & Pelham area (Jefferson Co.): 60
North Shelby/Hoover area (Shelby Co.): 665
Chelsea: 320
Altadena/Cahaba Heights area: 54
Liberty Park/Vestavia area: 438
Alabaster, Maylene & Saginaw area: 374
Calera, Montevallo & Wilton area: 360
Columbiana, Westover & Wilsonville area: 88

Number of homes for sale based on current selling price:

Alabaster, Maylene and Saginaw area:
$150,000-$200,000: 120
$200,000-$300,000: 89

Helena and Pelham areas (Shelby Co.):
$150,000-$200,000: 161
$200,000-$300,000: 121

Helena and Pelham areas (Jefferson Co.):
$150,000-$200,000: 3
$200,000-$300,000: 20

Chelsea:
$150,000-$200,000: 93
$200,000-$300,000: 122

Bottom line: There are still lots of choices!

David

Money seems to be changing hands without too much difficulty at Alabaster’s Colonial Promenade. With the AmStar movie theaters, four restaurants and two ice cream places within walking distance of where I took this picture, parking spaces wind up at a premium some times.

The week before, Colleen and I found waits of over an hour at a couple of restaurants at the Promenade. We finally had to drive north into Hoover. With scenes like these, I’d have to say that central Alabama’s economy could be in a lot worse shape!

David

If you were an extra terrestrial planning a visit to Earth and tuned in some of the news reports before arriving, what would you think about our society, given headlines like the ones above?

I might be tempted to keep on moving, and find another place to visit, where life doesn’t appear to be so gloomy.

As we start 2009, we have some big choices to make. How prosperous do we want the year to be? But more important … how hard are we willing to actually work to achieve that goal? Or will we choose instead to live more in accordance with the negative portrayals and not even try to make it a positive year?

I find it interesting to see the contrasts in views about our economy right now. Quite a few of the people we know and work with here in the Shelby county/Birmingham area are remarkably upbeat. That optimism still manages to shine through, despite a challenging 2008 and constant pessimistic predictions so prevalent in the media about the real estate, financial markets and world markets in general.

By the way … I didn’t make up the headlines above. I copied them from various websites during the last few months of 2008, as part of a small (and very unscientific) research project of sorts to see if the majority of stories carried any particular overall tone or slant. Does a prevailing tone come through to you? There is to me. Nope, I’m not ranting about wanting more positive or ‘happy’ news. That’s not what we need. What does bother me is that so many people in the mainstream don’t seem to be getting a very balanced perspective about such a broad array of subjects, based on what they read and hear. If they were, I don’t think we would have had people asking us questions recently like:

Colleen and I have wound up explaining—more than once—that, contrary to popular belief, the home sales market in Shelby county and Birmingham is still pretty healthy, despite downward trends in the area during 2008. And I think back to a few days before Christmas when The Birmingham News ran a story about a “silent” mall where holiday shoppers were a scarcity. Later that afternoon, as we passed the Galleria on I-459, we observed traffic backed up on the flyer-over ramp onto the interstate, waiting to pour in to the Galleria and Patton Creek. The newspaper wasn’t lying. But I wasn’t getting the full picture, either.

Want to keep balance in your perspective? My suggestion is to look around and decide for yourself. There are positive developments that affect the way we live and do business, and it’s not just happy talk. But you don’t hear as much about them. I’ve heard more than one person ask recently, “who would have ever thought gas would be this cheap?” While it’s anyone’s guess as to how long oil prices will stay where they are, there is still the inescapable fact that our national economy and virtually every business and industry, large or small, are benefiting in many ways.

So, what kind of year will 2009 turn out to be? When you listen to the talking heads and so-called ‘experts’ giving their predictions, remember that some of them just flat get it wrong sometimes. Alan Greenspan, former head of the Federal Reserve, maintained in 2002 and into the following year that there was not going to be a housing market bubble. He later admitted he was wrong. Part of getting the big picture, I think, means listening to those people, but staying careful not to put 100% confidence in everything they say.

I think we all have a lot more ability than we typically realize to control our financial and economic prosperity and destiny, rather than just citing bad or good luck, as so many often tend to do. But we’ll only prosper by having the full picture in front of us to start with. And then there’s the work involved to make it happen. Here’s hoping your 2009 really is a prosperous one.

David