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Why with all the market reports?
This is the time of year where I work really hard to become top-of-mind for my clients and friends. Sending a market report is my way of jumping up and down and waving my arms – pick me, pick me, pick me!
I know that people want to know about the value of their home. After all, your home may be one of your largest assets. I want to be the professional you rely upon to give you an update, just like you would rely on a financial advisor to update you on your retirement accounts.
Here’s what you need to know when looking at the market value of your home:
- You deserve it. Keep annual updates on the value of your home so you can compare it year over year.
- It’s an ESTIMATE! I can only provide you with a range as to the value of your home compared with other homes in your area.
- Consider if you have done any major updates to your home. The value of these updates would not be included and can greatly impact the estimate I provide.
- Invite me over to take a look! Seriously, we can go room by room and talk about your home projects. What have you done to update the value of your home and how does it compare to other homes? (Side note: my favorite topic to talk about is flooring! You CANNOT expect a potential buyer of your home not to notice that you have replaced hardwood flooring with vinyl. Vinyl, even if it’s called “luxury” it is
- NEVER the better choice if you live in a neighborhood where hardwood floors are the norm! Okay, end rant).
- Stay informed. Just as you would periodically check the market value of your other investments, check on the values in your neighborhood. I have just the tool for you: Neighborhood News. You will get an email from me, once a month, the provides data on homes in your area. Please don’t use $illow, that would kill me. The data from Neighborhood News is reliable, plus you get a report with my photo on it! Win, win.
Books, books, books
It’s a new year, and keeping with tradition, I have set a few goals for myself. Historically, I am terrible with goal setting. I like the idea of sitting down and planning out my year, the act of setting goals. But, like most of us, I stink at hitting the mark.
This year will be different. Why? This is the first year I have put my goals on paper for me to read. Daily. Plus, I am sharing it here too!
I have a few different business goals, but a simple one to share today is that I want to read 12 books this year. Sounds simple, I know. This means I must actively choose not to watch so much TV (or, gasp, look at my phone) and read a book! In addition to ready 12 books for pleasure, I want to read 4 business books this year.
Here is my list for business related content – what should I add?
- Building a Brand Story, Donald Miller
- What to Post, Chelsea Peitz
- anything by Seth Godin
- You2, Price Pritchett
And for fun, here is my list so far:
- West with Giraffes, Lynda Rutledge
- The Maid, Nita Prose
- The Mosquito Bowl, Buzz Bissinger (halfway through this one, currently gathering dust on my night stand)
- Abundance of Katherines, John Green (grabbed it for a quarter at the library book sale so I want to read it before I put it back on the shelf)
- Midnight Library, Matt Haig
- Spare, Prince Harry
Happy reading! Put your phone down. You’re welcome.
Des Moines Tour
Occasionally I am asked to tour clients around the area before they make the decision to move to Des Moines. This week I toured a young couple from Minnesota (no kids, yet). Like many from the midwest, they had “driven through” Des Moines on their way to ski in Colorado or make a trip to a warmer destination. They had never taken time to see our city. It was my chance to make Des Moines shine!
First stop, the East Village of Des Moines. I picked them up from their hotel and we drove by the Capitol, cute shops, historic churches, new breweries and bakeries. The East Village has developed immensely since we first moved to town 15 years ago! Next I showed them where the Downtown Des Moines Farmers Market is held as well as Principal Park and the Gateway Sculpture Park. We dreamed about warm summer days and the Des Moines Arts Festival and all of the summer events downtown. We talked about the ease of living in a mid-sized city like Des Moines: less traffic, easy to get downtown, availability of parking, over all less stress and more affordability.
After we saw downtown, we headed west on Grand Avenue to showcase the beautiful homes South of Grand, Waterbury and Ingersoll neighborhoods. We all day-dreamed about the love of old homes, the charm, the trees … the maintenance! I love taking clients down 51st street in Des Moines. There is a variety of homes that makes me swoon and wish I did not live in the (dare I say) suburbs.
A loop past the Ashworth pool, Des Moines Art Center, and bike trails eventually led us to pick up 235 W and see the suburbs. When I am meeting with clients who are not familiar with Des Moines I talk a lot about the different types of housing available in Des Moines compared to the suburbs. For example, West Des Moines has a great mix of established neighborhoods, small ranch homes, and larger and new homes as you move further west. The thing I always like to say is “there is something for everyone in West Des Moines”. We didn’t travel past 73rd street in West Des Moines, but spoke a lot about the growth in Waukee, as well as the expansive growth in another popular suburb: Ankeny.
Waukee and Ankeny – this brings me to the end of the tour, the frontier of new construction! On the quick driving tour of the Des Moines metro I shared with my clients that Waukee (and SW West Des Moines) and North Ankeny is where all of our new homes are being built. Even if you are a purist who loves older, historic homes of Des Moines, you must recognize the significance of new home inventory to our housing market. It’s essential. We need more homes to be build, here. In Iowa. And across the country. There is a huge shortage of housing and builders need to catch up! The backlog of materials during the pandemic did not help, but it’s improving.
What did I miss on my tour? Let know what you would add so I can improve the service I provide.
Looking ahead to 2023
It’s January; that means that Realtors like me are spending a lot of time planning our businesses for what’s next. We do not have a crystal ball, but we do have data. Looking at sales data from 2022 can tell us a lot. More than 3 nugget of information makes my head spin, so here are my top 3 takeaways:
- In Des Moines, the median list price was $345,950 at the end of 4th quarter 2022. For reference, it was $253,998 at the end of 2019.
- 4.6 was the inventory of homes for sale at the end of 4th quarter 2022. For reference, this is very close to inventory levels at the end of 2018 & 2019. This means if no new homes come on the market it will take 4.6 months to sell it all. 6 months is balanced. This level of inventory still benefits sellers, even if slightly.
- Appreciation of home values is still growing, but slower. Think slow & steady, not crazy!
What does this mean for you – as a homeowner, potential buyer or seller? All data sources show me that I think we a headed to a real estate market that more resembles 2018 & 2019. This is a good thing! The frenzy of the market 2020-2022 is not sustainable. Best case, interest rates will stabilize this year between 5 to 5.5% and buyers will accept this. Sellers will get off the fence and list their homes on the market, thus easing inventory struggles. New construction inventory will continue to outpace existing homes sales (builders are catching up from a decade of underbuilding – this is a separate blog topic, stay tuned) so buyers will have more options.
Your decision to make a move in 2023 is a big deal. I will always do my best to provide you with timely market data so you can make the decision that matches your goals.
Cheers to 2023!
Cheers to 2023!
*sources: Des Moines Area Association of Realtors & MLS data, Simply Des Moines real estate report, Buffini Bold Predictions
Market Absorption
As Realtors, we have a lot of data at our fingertips. The MLS provides a wealth of history on past sales and active listings: days on market, price per square foot, list price versus sales price, and so much more. Knowing how to use this data to provide a seller with an accurate picture of how long it will take for their home to sell is what I love to do.
A market absorption analysis (full deep-dive into similar homes in a specific market) will generate a market absorption rate I can share will sellers. The market absorption rate provides sellers with their specific rate (rate a which their home will sell, given no new inventory hits the market). First, I start by gathering sales history of the overall Des Moines real estate market, then break it down to match the seller’s property specifically (neighborhood, square footage, bedrooms, baths, age of home – ALL the specifics).
From the example below, this seller’s market absorption rate was 3.3. This means that if no new homes hit the market, all homes will be sold after a little over 3 months. “Andrea, how long will it take to sell my house?” I do not have a crystal ball, but having the data to support our pricing strategy makes all the difference! In a balanced market, the absorption rate is 6 (meaning that in 6 months all inventory would be sold). Given this seller’s rate is 3.3, the seller has a slight advantage and we could hit the market with a more aggressive price.
Home Values & Remodeling
One of my favorite questions is when friends reach out to talk with me about updating their home. They ask questions like “how much will I get back if I remodel my kitchen”, or “We aren’t moving, but I think we might put on an addition to our house, will we get that money back”?
Short answer: there is no money back guarantee. You must consider financing and scope of the project. Are you remodeling your home in order to bring you joy and make it more functional for your family? Or, are you updating big ticket items such as a roof or windows as part of home maintenance? (Personal note: the first option sounds much more fun, we have been mostly plagued by option two!)
My response is usually the same: “Well, I think it would be easier to just move, let me help you with that”. Just kidding! Deciding to undertake a remodel is not a small decision. You have to consider if you are paying cash for the project, or financing. Are you taking equity out of your home to complete the project. There are certain big ticket items that buyers of your home expect to be functional (think boring, but expensive). Do these things first!
- Roof
- Windows
- Siding
- Waterproofing & foundation repairs
- HVAC
Then it’s the fun stuff:
- Kitchen
- Master Bath
- Basement
- Landscaping
One of the reasons I love this topic is because we have personally done all 5 of the boring items on this list, as well as our basement and some landscaping. I understand that the updates and changes you make to your home matter. I will never forget that Nate and I almost purchased an older home in the Chicago Suburbs (Barrington, Illinois). Our realtor so casually mentioned to us that we could just “blow the roof off and remodel the upstairs” as if a project like that was not a big deal. All projects done to your home are a big deal because your home matters!
I can share with you a document which shows the contributory value of each of these projects that corresponds with the price range of your home or connect you with reliable contractors. Please reach out.
Like many of you, 2020 was the year of home updates, new roof & windows:
Selling an Estate
Last week I sold a house that was an estate. I was given a referral from my friend Beth to sell the home of her childhood friend’s grandmother (are you with me)? The conversation was something like “Hey, Beth, do you know anyone in Des Moines who can help my family sell my grandmother’s house? My grandma died this summer and, we don’t live in Iowa and we need help”. Beth connected me with the family and when we first met I was immediately grateful for my years working at Northern Trust in the Trust & Estates Settlement Department. I learned so much working there!
There are a few extra steps that go along with selling an estate:
- Who are the decision makers? When a lot of family members are involved, one person needs to be appointed by the estate to make all financial decisions.
- You will need a letter of appointment from an attorney to determine who can sign for the estate. Typically this is the executor. The executor is the only person who can sign all the documents in the real estate transaction.
- Prior to listing, consider an estate sale of selling household goods and furniture on consignment. I can refer you to a few reputable companies in our area.
- Consider if you are willing to sell the home “as-is”. This means that you are not willing to negotiate repair requests with a buyer. The price at which the home is listed would be lower. Sometimes buyers are scared off when they see an “as-is” listing.
- Technically, an estate is exempt from completing a seller’s disclosure. If you have never lived in the home, you are not expected to know the details. You should still disclose anything you know about the home.
- Make a plan for who is responsible for maintenance on the home until it is sold (think – snow removal & lawn care).
- Gather maintenance records. It will give a new buyer comfort to know if the HVAC system was maintained.
- Consider offering new buyers a 1- year home warranty as peace of mind.
Welcome to Home Matters blog!
I am sharing this blog with all of you to share my stories and experiences in real estate because I think home matters. Buying and selling real estate is a big deal, it doesn’t happen in your life everyday. I understand that as a Realtor, I work with people when they are at their most stressed, not always at their best. I want my clients to know how much their home matters to me.
Thanks for reading. Along the way I will share client stores, market updates, behind-the-scenes, and whatever else comes my way. Real estate is a wild ride, let’s have fun learning together!
All the best, Andrea
October 2022 Clive Market Update
Each month I share market a market snapshot of my neighborhood. I figure most of my neighbors are like me, they want to know which homes hit the market and what they sold for. I want to be the go-to source for that information, not $illow so I post a snapshot each month. Last week I posted this and a few neighbors reached out to me to express their surprise.
Well, all real estate is local. We’ve all heard that the market is “slowing” but generally that news is nationalized. Here in the Des Moines metro, the pace of home sales has slowed and the number of homes on the market is steadily increasing. The pace of real estate during, and post-Covid is not sustainable, it shouldn’t be. This shift in the market is necessary, even if we all hate to admit it. It’s a great time to be a buyer! But sellers, please pause and take a breath. Chances are you have lived in your home a long time, you have equity and a lot of appreciation in the price of your home. You did not miss the boat, you missed the crazy storm of pandemic real-estate. If you’re considering selling in the next year, let’s meet to make a plan that’s best for you.
If you want to get the scoop on YOUR neighborhood, sign up for Neighborhood News.
