865 Real Estate

East Tennessee Real Estate & Neighborhood Source

Is the appeal for types of neighborhoods in Knoxville changing?

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Neighborhoods in KnoxvilleIs the appeal for types of neighborhoods in Knoxville changing? A recent study by the National Association of REALTORS shows that more and more Americans are showing a preference for walkable neighborhoods that combine a mix of homes and stores. The survey actually shows that your typical suburban neighborhood, with just homes, is the least popular.

I have to admit, the thought of being able to take a short stroll down a landscaped sidewalk, waving and possibly talking to neighbors on the way.  Then stopping at a corner shop for a cup of coffee or a bite to eat does sound desirable.  It almost puts you in a time machine back to the way things used to be before we traded welcoming front porches for private back patios.

Here are some interesting findings from the National Association of REALTORS®’ 2013 Community Preference Survey:

  • 60% of Americans surveyed say they favor neighborhoods with a mix of houses, stores and other businesses that are easy to walk to over neighborhoods that require greater driving.
  • 78% of respondents said that the neighborhood is more important to them than the size of the home.
  • 57% said they would give up a home with a larger yard if they could have a shorter commute.
  • 55%  said they’d give up a home with a larger yard if they could live within walking distance to schools, stores, and restaurants.

With mixed use neighborhoods in Farragut and Knoxville springing up like The Cove at Turkey Creek and Northshore Town Center, we are seeing this trend slowly arriving at our doors here locally.  What are your thoughts about the survey results?  Do you agree with them?  What are you looking for in your ideal neighborhood?  Is walkability a big factor?  Comment below and let us know.

Signs That The National Housing Market Is Performing Well

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knoxville_housing_marketEven with the rising interest rates of late (although the good news at the time of this writing is that this week rates have actually decreased to a four month low), the national housing market seems to be performing rather well.  According to the HousingPulse Tracking Survey by Campbell Surveys and Inside Mortgage Finance, although homes sales were down somewhat in September, other factors were very positive.

Here is where we see positive signs in the housing market:

  • Time on market fell to a four-year low last month. Based on September data, homes spent an average of 8.6 weeks on the market.  A big reason for the importance of this number is that time on market is actually down from the spring home buying season, when the time on market was about 10 weeks.
  • Homes are selling for a high percentage of their list price. The sales-to-list-price ratio in September was 97.5%, up from 96.1% in September 2012.
  • Sales of distressed properties, home purchases involving foreclosures and short sales, decreased to 24.6% over the three-month period ending in September, marking a four-year low.

For detailed information on the status of particular neighborhoods in Knoxville or to get an estimated value on your Knoxville home contact 865 REAL ESTATE for a no strings attached home evaluation.

Mortgage Rates Drop Significantly After Jobs Data Report

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Mortgage Rates in KnoxvilleMortgage rates fell fast yesterday, after the “Employment Situation Report” showed a less than rosy picture for labor markets.  The report, which was originally scheduled for October 4th, was delayed due to the government shutdown.  Conforming 30yr Fixed rates dropped down to 4.125% for many borrowers depending on the scenario, though some lenders remain at 4.25%.

Weak economic data historically pushes rates lower and yesterday was no exception, but there is more to the story.  The peripheral effect of yesterday’s report is that it further solidifies that the Fed will likely hold off on reducing its purchases of Treasuries.  These are the purchases that have helped to keep rates lower than what they would be normally. The recent threat of those purchases decreasing had a significant effect on mortgage rates during the summer months.

What does this mean for Knoxville home buyers and sellers?  JUMP ON THESE MORTGAGE RATES while they are this low and save yourself some money on your monthly payment.

Real Estate Update – What’s happening in the Housing Market

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Knoxville real estate updateRecently released reports show that July new home sales were down over 13% month to month, but existing home sales increased a healthy 6.5%.  Why there is such a big difference? The reason is that new home sales are based on signed contracts in July and the existing home sales numbers are based on closings which were contracts signed in May or June.  One factor for this difference is rising mortgage rates which jumped from 3.5% to 4.5% between May and July and made buying a home 15% more expensive.  This rising expense is just calculating the increased mortgage rate, not the rising prices of homes.  Lender Processing Services calculates that prices have increased nationally by 8.4% from last year.  The S&P Case Shiller Index calculates the increase at 12.2%.  Rising rates plus rising home prices are beginning to effect the ability to buy a home for some home buyers.  It is even beginning to effect the investor market.  Investors who have been bolstering many markets, accounted for only 16% of the sales in July, down from 22% in February.  First time home buyers, who may be feeling the effect of these higher home prices and higher mortgage rates, historically account for around 40% of home sales. In July, first time home buyers only accounted for 29% of the home sales.  If mortgage rates level off and the current administration continues to focus on making housing a priority for the ailing economy, then home sales should continue on a steadier pace.  However, if rates keep increasing along with prices, the housing market will be negatively impacted.  Have questions about the market or any real estate questions in general?  Contact the 865 Real Estate team today!

Higher Home Prices, Lower Inventory, What’s causing it?

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Knoxville real estate higher prices lower inventoryAccording to the National Association of REALTORS, the national median home price saw the strongest year-over-year increase in seven years as a growing number of metropolitan areas posted higher median values in the fourth quarter of 2012.

What are the factors causing the price increases of today’s real estate in Knoxville and beyond?

1) Attractive affordability conditions:

  • Mortgage interest rates are hovering near record lows.
  • Quoting NAR President Gary Thomas, “In reality, home prices overcorrected on the downside and homes in most of the country were selling for less than replacement construction costs, which means they were undervalued.”
  • Lawrence Yun, Chief Ecomomist for NAR stated, “The housing affordability index shows that the national median income of families was almost double the income needed to buy a median-priced home in 2012, so most buyers are able to stay well within their means.”

2) Decreasing rent affordability (rising rent prices)

3) Demand for housing:

  •  The population has been growing faster than overall inventory of Knoxville homes for sale.
  •  Unsold inventory, nationally, is at the lowest level in 12 years.

4) Job creation:

  •  Steady job creation leads to more buyers in the real estate market.

Troy Stavros, Broker and Partner with the 865 Real Estate team at Gables & Gates, REALTORS says, “These factors have not only increased the value of Knoxville real estate but have turned what was a buyer’s market no so long ago, into a seller’s market.”

Knoxville Real Estate: Fannie Mae National Housing Survey Results

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Knoxville Real Estate and the Fannie Mae Housing SurveyThe most detailed survey on the attitudes of consumers of its kind, the Fannie Mae National Housing Survey polled 1,003 Americans via live telephone interview to assess their attitudes toward the housing market and overall consumer confidence.

Troy Stavros, Broker and Partner with the 865 Real Estate team stated, “We see, on a daily basis, the increase in consumer confidence. The influx of buyers into the Knoxville real estate market, that is resulting in a dwindling inventory of Knoxville homes for sale, speaks volumes.” Echoing Stavros’ sentiments, the Senior Vice President and Chief Economist for Fannie Mae was quoted as saying, “”The housing market continues to firm, with consumer home price expectations for both rental and ownership properties near the strongest levels that we’ve seen in the survey’s two-and-a-half-year history. Concerns about job loss are waning as payrolls are growing – a trend that may give potential homebuyers more confidence that they can meet the financial obligation of homeownership. The upward trend over the past year and a half in the share of consumers who say it’s a good time to sell may reflect two related events. First, homeowners see that home prices are improving. Second, the number of homeowners who are underwater is declining, reducing a barrier for those owners who need to sell their home in order to buy a new one.”

The summary of the results of Fannie Mae’s January 2013 National Housing Survey are:

  • More survey respondents believe now is a good time to sell a home (up 12% from last year’s results). Stavros says, now is a great time to be selling a home in Knoxville because the resulting low inventory levels has turned it into a seller’s market.
  • Expectations around personal finances remain flat.
  • Approximately 41% of respondents believe home prices will rise in the next 12 months. Stavros confirms that the Knoxville real estate prices have already risen and continue to do so.
  • Respondents believing prices will continue to drop reached a low of 10%. Stavros stated, “There will always be that select few that refuse to believe that something positive is happening. Unfortunately those are the same folks that don’t take advantage of good market conditions, and watch as they pass them by.”
  • 41% of respondents expect mortgage rates to rise in the coming year. Stavros believes Knoxville mortgage rates will rise slowly, but will stay below 4% for the rest of 2013.
  • 50% or respondents believe rental prices will rise in the next 12 months. Stavros confirms that Knoxville rental prices are already on the rise, and the law of supply and demand will send them even higher.
  • 65% of surveyed Americans said they would buy if moving in the near future.
  • Approximately 43% of Americans see financial situations improving over the next year.
  • 23% expect household incomes to rise significantly, an increase over a year ago.

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