Beginning to see Slowdown in Marketplace

by qawallace 20. August 2014 15:28

As we get near the end of August and into the fall, we see some changes in the marketplace.  The spring and early summer buying season is now over.  It was not robust and now August is quiet so far.  School is either back in session for many or is about to begin right after labor day.  There is softness in the Hemet market and Menifee markets.  Menifee sellers are fortunate that it is a tight inventory of resale homes.  Unfortunately, there is a lot of new construction heavily competing for these sales.  Lennar homes has entered a market full of many builders. Winchester is beginning to show softness in new construction.  Builders are lowering prices to get their standing inventory and soon to be standing inventory sold.  Murrieta is holding steady but with a little work or the use of Smartworks Real Estate, a deal is there to be made.  Temecula is having longer days on the market and homes are coming to market with more realistic prices per square foot.  A great deal in new construction can be found at RR right now.  The reality is this.  There are deals to be had in the market if you know how to find them and negotiate for your savings.  Smartworks does this very well and will save you money.  They are the real new home specialists in the area.  Between now and the end of December, there are deals to be made!  Smartworks is available at 951-834-2640 or www.SmartWorks4U.com.  Happy hunting.

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Current Forecast

by qawallace 27. May 2014 19:58

Around October of 2013, I predicted a correction in the market place and expected pricing to begin softening at the beginning of 2014.  I made this prediction because of several factors.  We are currently in a "full documentation" lending environment.  W-2 incomes need to support the income requirement of the home loans.  Stated income type loans are dead and have been for some time.  It is very difficult to get a home loan if you are self employed.  Some offsets to this include higher interest loans with much higher down payments than with FHA loans.  These changes from the peak years has greatly reduced the quantity of qualified individuals who can qualify for a home loan in Riverside County.  Riverside County have far fewer quality W-2 jobs than our sister counties of San Diego and Orange.  In addition, the military buyers have been greatly diminished due to the changes currently going on in that sector of the economy.  Many Riverside County residents are self employed.  With these factors in place, why have prices gone up so fast in the past couple of years?  Investors came into the market place because prices were so low and the available rents allowed for positive cash flow from day one.  Rents have gone up but with the sharp price increases, investors have left the buying market due to their concern that further price gains are unlikely in the short run.  With this significant reduction in investor buyers, more homes are available for those buyers which are using financing as the way to purchase their dream home.  I feel this makes a more stable long term market without investors and allows us to better predict price increases.  So, now why did I predict a correction in the market place with future price reductions?  The cash buyer's and investor's which help bid up the price of homes have significantly left the market.  There has not been a new influx in W-2 jobs into Riverside County which allow families with enough income to purchase homes at today's prices.  The military, which has historically been a great provider of job transferee's, is reducing their ranks.  I had expected price corrections beginning in January 2014.  This correction has not begun until March 2014.  Inventory levels were increasing through March which created a situation where seller's felt prices were going up but buyer's have been frustrated looking at the prices being asked.  Inventory levels are starting to fall and prices are only going down a little.  Depending on the area, higher demand areas are not seeing reductions in price yet.  Areas such as Menifee and Hemet are showing softness as I would expect.  Here is my current expectation for the next six months.  June and July will see stable pricing.  August and September will see softness with price changes downward in October through December.  Overall, I expect prices to fall 5% over this time.  How should you proceed?  If you are a seller, sell sooner than later.  If you are a buyer and can be patient...make sure you buy value.  Don't rush but when a great value pops up, jump on it.  If you look enough, you will know the difference when it arrives.  With prices falling slightly, you don't have to worry and buy now, afraid prices are rising.  They are stable and maybe falling some (up to 5%).  

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Welcome to the Smart Blog, We hope you find the information useful.

by qawallace 27. May 2014 19:56

Welcome to my Blog.  This is the introduction post and will give us a starting point to begin.  My goal for this Blog is to provide information which specifically provides my assessment of the current market in the Temecula Valley real estate area as well as provide my opinion on the upcoming trends occurring and my forecast for the near future as well as in the coming years.  I hope you enjoy reading my Blogs and hope the information will be useful for you.  You may challenge my opinions at any time as that would make a better discussion.  My direct contact email is alanwallace@smartworks4u.com and feel free to visit my website www.SmartWorks4U.com 

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Welcome to our Smart Blog

by qawallace 28. April 2014 10:54

We welcome you to our Smart Blog.  We try to provide you up to date expertise and educated opinions of what is occurring in the real estate market place in the Temecula Valley area of Southern California.  We also try to provide you our opinion of what will be occurring in the future, both near term as well as longer term.  This added information can assist you in your choices.  Please remember, our forecast is an estimate of future events and we don't know for sure what will actually occur in the future.  If we are wrong, we will try to understand why and explain this information in the Smart Blog.

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