Archive for August, 2007
Raleigh Home Values Inside the Beltline on Steady Incline
August 30th, 2007 Categories: Inside the Beltline, Real Estate Market Trends
Thinking about buying a home in Raleigh that will also be a great investment? Home values in Raleigh’s Inside the Beltline area have proved to be a great investment over time. Based on these numbers, it doesn’t take that much time to see a return either!
Anyone looking for a Raleigh home for sale knows that Inside the Beltline is the cream of the crop when it comes to location and character. Huge oak trees that are hundreds of years old. Classic homes from the ‘30s and ‘40s. And a location for which Raleigh home buyers have consistently demonstrated a vivacious appetite.
Over the past two years, the average resale price for a detached, single family home has increased 13.6%! This is during a time when high end residential real estate in much of the country has declined in price.
In Q3 of 2005 the average sell price was $356,357. It had reached $404,766 by the end of the most recent quarter of 2007. That’s a $48,409 increase.
What do you get in this prime downtown Raleigh location for $400K? The average square feet at that price is 2027. That’s right at $200 per square feet.
Inside the Beltline is Raleigh’s premier address and some of the most coveted neighborhoods create a place you will not find anywhere else in our market.
In the coming weeks I will be doing some feature articles on some of these neighborhoods. Leave your suggestions in the comments section below.
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The Mortgage Meltdown and the Raleigh Real Estate Market - Part 3 of 3
August 29th, 2007 Categories: Mortgage and Finance
In Part 2 of this series I discussed the impact of the mortgage meltdown on clients wishing to buy a home in Raleigh and surrounding areas. Today’s final installment will cover what this means to the average Raleigh home seller. I will also attempt to address the reaction of financial markets to the mortgage meltdown and speculate on whether we’re done, or if there is more bad news to come.
Selling a Home in Raleigh
The Raleigh real estate market is very good right now. Forbes magazine reports that Raleigh is the #1 seller’s market in the country. Well prepared, professionally marketed Raleigh homes that are accurately priced are easily selling in 4-6 weeks. Some even quicker. Let’s talk about why the ability of Raleigh home buyers to obtain financing changes things for sellers.
If you’re selling a home in Raleigh, the effects of the changes in the mortgage industry on you is much more subtle that it is for home buyers. The agent you choose to represent you and how up-to-date he or she is on this topic has become critically important. Home sellers and their real estate agents must now look at the financing terms on offers in a very different way.
Section 5 of the North Carolina Offer to Purchase and Contract will now require closer scrutiny to know if an offer to purchase your home is a good one, or not. Talk about good timing! This form was actually revised in July 2007 and now makes following the progress of a borrower’s attempt to obtain financing much easier. Unfortunately, the new form is not mandatory until November 1st.
I’ll be doing an article on the changes to our forms in the next few weeks, but for now just know that regardless of which form is used, any disclosed condition that is marginal should be a red flag. Buyers who are not being encouraged by their agents to deal with a well known and trusted lender, or who have not been recently qualified may not know they cannot obtain the home loan they need to complete the purchase of your home.
A good, recent pre-qualification letter must be submitted with all offers. By the way, pre-approval would be better. Much better. Pre-approval means that the buyer’s financial position has been more carefully considered and documented by the mortgage lender and all that remains is final underwriter approval and successful appraisal of the property. On the other hand, pre-qualification simply means that a credit check was performed and the buyer gave the lender a believable story. Consider requiring pre-approval on all offers.
The bottom line for Raleigh home sellers is that they and their agents must very closely examine the financing information disclosed in section 5 of the offer and ask plenty of questions if anything is unclear, or looks suspicious.
You might also be thinking that the pool of possible home buyers is reduced because some are now unable to obtain financing. Marginal buyers will be shut out of the market. The good news is this is a very small group. The Raleigh real estate market does not seem to be slowing down as a result of this. It’s really a matter of risk management for Raleigh home sellers now more than anything else.
Is the Worst Over?
The financial markets have reacted in large part with fear to what has gone on in the past months. Mortgages are bought and sold in secondary markets and many business entities own various pieces of them. The investment community has been selling and avoiding companies with known exposure to risks from mortgages. No surprise there.
I believe that once the mortgage origination industry can demonstrate that the new rules have mitigated the future risks, investors will once again turn their attention towards the lucrative secondary markets. The question is how long will this take?
I think we will live with the current conditions for a while. And for all of us here in the Raleigh real estate market, we will be okay with this as long as we exercise caution where necessary on both the buying and selling side.
Expect a lot more detailed questioning from your real estate agent and mortgage lender. Questions are good. They get people talking about possibilities and making better choices. Realtors upholding their fiduciary duties to clients have been asking questions all along. It’s just more important now than it was before.
Related Articles
The Mortgage Meltdown and the Raleigh Real Estate Market – Part 1 of 3
The Mortgage Meltdown and the Raleigh Real Estate Market – Part 2 of 3
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Peanut Roaster is a Hit With Raleigh Home Buyers
August 28th, 2007 Categories: Local Businesses
I started a tradition several years ago of giving a gift basket from The Peanut Roaster to every client who buys or sells a home with me in the Raleigh area. It has proven to be a wise choice that has added value to my relationships with my Raleigh real estate clients.
When I first started out as a Raleigh area Realtor I tried several various ideas for expressing my thanks to clients at closing. I’ve tried everything from delivering pizza on moving day to leaving a bucket of various household items at the house as a surprise for the client when they arrive at their new home after closing. About two years ago I discovered the ultimate gift for this purpose. A beautiful basket full of every conceivable flavor of North Carolina grown peanuts that you can imagine.
Many of my clients are relocating to Raleigh and the gift basket from The Peanut Roaster gives them a taste of something unique to the area. Something they probably have not previously had the opportunity to experience. Many of the products are part of the Goodness Grows in NC program. Plus, when my clients arrive at their new Raleigh home after closing they typically don’t have a well stocked refrigerator waiting for them. Heck, many of them don’t even have a refrigerator for a few days!
Besides delivering a great product for me and my Raleigh home buyers, the customer service is outstanding too. Joyce Holloway at the North Raleigh location is just awesome. She makes the whole process so easy for me. When I first decided to start using The Peanut Roaster for move in gifts, Joyce sat down with me to design a standard basket that I could reorder whenever I had a closing. Now I just call and tell her how many baskets I need and they are ready when I stop by to pick them up.
The basket I ended up with is just perfect for the occasion. Joyce took a house shaped wire basket and filled it with a wonderful variety of flavored peanuts and related items. The presentation is impressive and the contents are delicious. Now when a client moves into their new Raleigh home they have gourmet snack food to tide them over until the house is in order!
I’ve received lots of very nice thank you notes for the baskets over the years. Several people have contacted me to find out where to get refills. One lady wrote me a note a couple of weeks after closing to let me know she was now addicted to the barbecue flavored peanuts. Many of my clients who are in businesses that have a need for thank you gifts have contacted me to find out where to order baskets for their clients.
Need a unique gift basket that people will appreciate and remember? Stop by The Peanut Roaster and tell Joyce I sent you!
The Peanut Roaster Locations
8801 Lead Mine Road, Suite 111
Raleigh, NC 27615
(919) 518-0875
115 Weston Parkway
Cary, NC 27513
(919) 677-9767
11721 Retail Drive
Wake Forest, NC 27587
(919) 554-0797
Coming Soon!
8741 Brier Creek Parkway
Raleigh, NC 27617
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The Mortgage Meltdown and the Raleigh Real Estate Market - Part 2 of 3
August 27th, 2007 Categories: Mortgage and Finance
The Raleigh real estate market has definitely been affected by by recent changes in the mortgage industry. As a result, buying or selling real estate in Raleigh has changed too. Much confusion exists. We need a better understanding of what this means to the local buying and selling public.
In Part 1, I discussed what the mortgage meltdown is and what has changed in the mortgage industry. So what does this really mean to someone wanting to buy a home in Raleigh, North Carolina? What about someone selling a home? Today, let’s talk about the more obvious one… home buyers.
Buying a Home in Raleigh
In the previous article, I listed several things that have changed for borrowers applying for a home loan. Two big ones were:
- A good credit score is more important than ever
- Full documentation is required where it may not have been in the past
A more difficult to define change is the somewhat limited availability of 100% financing. Loans not requiring a down payment are still available, especially for conforming clients with good credit scores and full documentation. If either of these two elements are lacking, 100% financing may not be an option for borrowers.
The bottom line is that anyone seeking a loan to buy a home in Raleigh, or anywhere else for that matter, needs the advice of a mortgage professional now more than ever before. The rules have changed since you last purchased a home. I can promise you that.
Does this mean you might not be able to get a home loan in today’s environment? The only way to answer that question is to seek professional advice. For some, nothing has changed. There are still lots of financing options for home buyers. The sooner you discover those options, the better choices you can make. If you need the name of a good, reputable mortgage lender, send me an email or call me at 919-602-7000 and I’ll be glad to recommend someone.
The real estate agent you choose to represent you is also a decision you should make very carefully. The degree to which your agent has his or her mind around this new mortgage environment is critical to your home buying success.
In Part 3 of this series you will read about how savvy home sellers and their agents will be carefully considering the validity and associated risks of the financing terms in any offers they receive. The North Carolina Real Estate Commission considers terms of finance to be a material fact and requires accurate and complete disclosure. Your Raleigh real estate agent must be a skilled negotiator and capable of putting together an offer that will be accepted. Especially when there are competing offers. Unlike many other areas around the country, we still have that scenario here in the Raleigh market.
Your real estate agent must also have the guts to insist that you spend some quality time talking about your options with a good mortgage professional. Beware of the agent who puts you in their car and drives off to show you homes without a high quality initial consultation session that includes this conversation with a lender. Or at least requires that conversation as the very next step in the process.
Be sure to stop by the next day or two for the final installment in this series where you will learn the implication of all this for home sellers. We will also spend a little time expanding on the reaction of the financial markets and do a little speculating on whether we have seen the worst, or if there is more unraveling to come.
Be sure to click on the comments link below and get involved in the discussion. I’d really like to hear your thoughts!
Related Articles
The Mortgage Meltdown and the Raleigh Real Estate Market - Part 1 of 3
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Cary Lazy Days Well Attended
August 25th, 2007 Categories: Cary
If you’re thinking of relocating to Cary, North Carolina you’ll be glad to know that there’s always something fun going on.
Here’s the live report from Cary Lazy Days that I promised. Locals took the opportunity to get out of the house from all over Wake County and beyond to attend the 31st annual Cary Lazy Days Arts and Crafts Festival.
We got there at about 9:00 and the place was already packed. Our strategy was to go early and avoid the heat. Many others shared that strategy.
We struck up a few conversations with folks and found that attendees really did come from all over, not just Cary.
We spoke to people from Raleigh, Wake Forest, Cary, Holly Springs, Apex and even as far away as Roanoak Rapids, VA.
The event was very kid friendly and family friendly. Here is a Cary Fire and Rescue guy entertaining a couple of kids with a remote controlled fire hydrant.
Entertainment was scheduled throughout the day. The Cary Town Band is warming up for the 9:30 performance.
There was a whole section set up just for food. There was everything you could imagine… kind of like the State Fair. People were eating those deep fried turkey drumsticks at 10:00 am!
These guys told us there was going to be a sword fight later in the morning. We didn’t stick around for that. 
Ah, one of my favorites and worthy of special mention. This is Joann Brown who traveled all the way from Charleston, SC to display her handcrafted sweetgrass baskets. If you’ve never seen these things you don’t know what you’re missing! We had fun chatting with Joann about baskets and Charleston. As it turns out, we had actually purchased one of these from her sister several years ago while on vacation in Charleston… small world, huh?
No trip to downtown Cary, North Carolina is complete without stopping by Ashworth Drug Store. This place is like stepping back in time. It’s complete with an old fashioned soda fountain and all the charm of the corner drug store you remember as a kid.
I hope this article helps gives you a little taste of what living in Cary is like. Cary Lazy Days happens every year and is a good example of the kind of family friendly fun that takes place in the Greater Raleigh area on a regular basis.
If you’re thinking about relocating to Cary, send me an email or call me at 919–602–7000 and I’ll be glad to answer any questions you have.
Related Articles
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The Mortgage Meltdown and the Raleigh Real Estate Market - Part 1 of 3
August 24th, 2007 Categories: Mortgage and Finance
Planning on selling or buying a home in Raleigh, North Carolina? Concerned about the turmoil in the mortgage industry? There may be good reason for some concern. Things have definitely changed. This article is the first installment in a three part series that addresses this critical issue.
You cannot turn on the news without hearing about rising foreclosure rates and lenders whose future stability is in question. Or worse yet, lenders that can no longer fund client loans at closing. A recent example is HomeBanc, a lender with operations here in our Raleigh market that many of my clients had done business with in the past. Yikes… this is hitting pretty close to home folks! We need a better understanding of what we are dealing with.
Let’s start by identifying more exactly this so called mortgage meltdown.
It started back earlier this year with a sharp increase in foreclosure rates. The rate of existing loans that were delinquent also began to rise. As the experts began to analyze the situation, not surprisingly, the bulk of the increase came from borrowers who had marginal qualifying ratios and either financed 100% of their purchase, or did this in combination with an adjustable rate mortgage.
Since that time foreclosures have continued to climb. Some lenders have gone out of business while others have had their future stability publicly questioned. And as usual, fear of the unknown has a firm grip on most everyone who is involved.
So how many homeowners in foreclosure are we talking about? According to Foreclosures.com, 3% of US home owners have lost their homes to foreclosure this year. This represents a staggering 41% increase over 2006. Almost a quarter million properties have been foreclosed on in 2007. It is estimated that several hundred thousand more homeowners are delinquent on their payments.
As a result of this increasing consumer default rate, it has been reported that over 100 lenders have closed. Most notably, however, is the massive tightening of credit standards and qualifying ratios that have resulted. This is what will have the greatest impact on home sellers and buyers in the greater Raleigh real estate market.
What has changed as a result of the credit crunch?
Two things. 1) A good credit score is more important now than ever before. 2) Full documentation is now required where is was not in the past.
Based on my conversations with several lenders, here are a few changes Raleigh home buyers and sellers need to be aware of.
- Sub-prime borrowers, those with credit scores below 625, cannot easily obtain 100% financing. Full documentation is being required for all borrowers who fall into this sub-prime category.
- Conforming clients are defined as those who have 5% down, good credit, and can provide full documentation. For this group nothing has really changed. 100% financing is available to these borrowers with full documentation.
- Clients who would otherwise be considered conforming, and wish to obtain a no documentation loan, should be prepared to pay a hefty premium… or present a 730 plus credit score.
- Mortgage insurance will be an option now in many cases where a combo loan was used in the past.
If you are a financial or mortgage professional, I would really appreciate your comments. So would the many Raleigh area home buyers and sellers who will read this article.
Be sure to check back in the next few days for part two where I will discuss the specific implications for home buyers and sellers in the Raleigh market.
| Discussion: 9 Comments »
Heritage Wake Forest - New 55+ Active Adult Community
August 23rd, 2007 Categories: Heritage, Wake Forest
Heritage Wake Forest continues to grow with the addition of a 55+ age restricted community. This new community, called Heritage Spring, will offer 48 low maintenance homes right in the middle of all the wonderful amenities that make Heritage such a great place to own a home.
All homes will feature first floor master bedrooms and a two-car rear entry garage. Prices are in the mid to upper $200s. There are three basic models with three variations of each for a total of nine floor plans to choose from. Contact me if you would like a set of floor plans to review.
Because Heritage Springs is located within the neighborhood of Heritage Wake Forest, you will enjoy amenities such as a semi-private golf course, swim and tennis facilities, greenway trails, shopping, dining, banking, health care, pet care and more!
Just in case you can’t find what you need within Heritage, a very short drive will take you to historic downtown Wake Forest. Just a little further and you will be able to enjoy all of the wonderful shopping, food and entertainment in North Raleigh. None of this is more than 15 minutes away.
This really is a beautiful neighborhood. I live near Heritage myself and drive through the neighborhood a couple of times each day. It’s one of the best designed neighborhoods I’ve seen. It’s a place where you really feel like you want to be part of what’s going on… and there’s so much to do. Most of it within walking distance. If you want to stay active, this is THE place for you.
Right now there are three homes available in September and another six scheduled for completion in October. If you’ve got time to build, pre-sales are also available.
If you are interested in finding out more about Heritage Spring, please send me an email, or call me at 919–602–7000 and I’ll be glad to answer any questions you might have.
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Midtown Music Concert Series at North Hills In Raleigh
August 23rd, 2007 Categories: North Raleigh
Looking for some great fun in the North Raleigh area? Check out the Midtown Music Concert Series!
The event will take place on The Commons right out in front of the Regal Cinema. Blankets and lawn chairs are welcome. There are lots of great restaurants around too. There is even a Starbucks right beside of where the event will be held. How’s that for roughing it? 
The Midtown Music Concert Series will be held at this same location in North Hills every other Thursday, from 5:00 to 8:00, beginning tonight and running through the end of September. Here’s the schedule:
Thursday August 23 – 5:00 to 8:00 pm
Kickin Grass
Carolina Bluegrass
Thursday September 13 – 5:00 to 8:00 pm
Steve Hobbs
Instrumental Jazz
Thursday September 27 – 5:00 to 8:00 pm
Big Daddy Rhythm & The Heavyweights
Beach & Shag
Kickin Grass is led by a fellow Realtor friend of mine, Jamie Dawson. His band played at the grand opening of our new Keller Williams office earlier this year and they were awesome!
Check it out and let me know what you think. Be sure to leave your comments below.
| Discussion: 2 Comments »
Cary Lazy Days
August 22nd, 2007 Categories: Cary
Looking for something to get you out of the house in Cary, NC this Saturday? Look no further… the 31st annual Cary Lazy Days will provide a good excuse to do just that!
Cary Lazy Days is a arts and crafts street festival that is expected to draw 60,000 people to downtown Cary, North Carolina on Saturday, August 25th.
There will be lots to do including some incredible arts and crafts displays, food and entertainment. I’ve been in the past and it really was a fun time. Very family friendly. The artists and craftsmen have some very good works that you can browse. This would be a great place to find that unique piece you’ve been after for that special place in your new Cary home.
The weather report is calling for 94 degrees with a 30% chance of isolated thunderstorms. That’s pretty typical for this time of year in North Carolina. Be sure to bring the appropriate sunscreen, hat, etc. and dress comfortably.
Although the festival takes place in Cary, it draws visitors from all over the greater Raleigh area. I plan to be there in the morning and will do a follow up article for any of you planning to relocate to the Cary area who would like a brief summary of what it was like. Stop back early next week and check it out.
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Why the Raleigh Real Estate Market is #1 in the Nation
August 19th, 2007 Categories: Real Estate Market Trends, Why Move to Raleigh?
An article on Forbes.com from late June declared Raleigh, North Carolina as the number one home seller’s market in the US. Their determination was based on three metrics.
- A measure of current inventory. This is simple a supply and demand analysis which Forbes based on numbers from the National Association of Realtors and Moody’s Economy. Current inventory is the measurement of how long it would take to sell all currently listed homes at the current sales rate. According to Forbes, the Raleigh real estate market is number one in the nation in this category.
- The change in the sales rate over the past year.
- Price stability. This was considered as a way to exclude upstart markets and only include real estate markets with steady, sustainable home values.
The Forbes article cited Raleigh’s strong economy, moderate growth, and carefully paced building as key factors in the high ranking. So how does this stack up compared to a local Realtor’s opinion of things? Let’s start by looking at current inventory.
With the number of current listings in Raleigh at 3850, the current inventory is about 4 months. As you can see in the chart, it varies slightly depending on whether we use the stats for July home sales or 2nd quarter of ‘07.
We can also look at the change in average sell price by comparing activity for the second quarter of this year with the same quarter of 2006.
Average Sell Price Comparison
Q206 $245,849
Q207 $254,124
The average sell price has increased $8,275, or 3.4% by this comparison. Keep in mind that the 2nd and 3rd quarter of 2006 were above average with closed sales of 2,889 and 2,952 respectively. Actual resale appreciation, which is different than increase in average sell price, was closer to 5%.
My conclusion is that we do indeed have a very good home seller’s market here in Raleigh, North Carolina. It’s growing at a normal pace that allows home sellers to make a good return for their investment and home buyers to get into a healthy real estate market with very good opportunities for future growth.
I think the major reason it continues to be so steady is we have never had the sharp run up in prices that much of the rest of the nation has experienced. Overall, we are keeping pace with affordability.
If you’re interested in selling your home click here and submit a request for a free home value analysis.
Related Articles
The Impact of a Slow Market Somewhere Else on Raleigh Home Sales
North Raleigh Real Estate Market Snapshot
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