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Housing Forecast for 2015

by Eric Bushnell

In January 2014 I wrote a blog on 2012 with a forecast for 2014.  Here is how it started:

"Turbulence on the horizon…

Today is January 18th, 2013, what will 2013 bring? Many people are saying that 2013 will be a great year. I believe that we will good times and slow times in the coming year. 2012 saw growth in the number of homes sold in the Anchorage and Eagle River markets. The Mat-Su Valley was closer to flat, with gains in some areas and losses in other. Most will agree that the average home value increased between 1.5-3.5%...” for the whole article click here!

2014 started out pretty slow and then gained speed through the summer months; however the total number of homes sold in the Anchorage and Eagle River markets appears to be lower than 2012.  The Mat-Su Valley, Palmer and Wasilla, saw an increase in sales by approximately 18% through the first three quarters of the year.  Still waiting to see the final numbers to see if this sales trend was able to sustain the pace.  New construction in Anchorage and Eagle River was down this year as less homes were built.

2015

So let’s start with new construction.  There will be less building sites available this year, and building prices will be higher.  Keeping this in mind, it is safe to say that there will be fewer choices to be had within the Anchorage bowl.  In the Mat-Su I anticipate new home sales to be about the same as 2014.  The valley will continue to be a bargain compared to Anchorage; newer homes and in most cases more affordable.  Land is less expensive in the valley.  Average cost per acre is about $55,000 and in Anchorage the average .25 acre lot is $140,000 or more.  The valley is home to more contractors.  This naturally leads to more competition than in Anchorage, and competition leads to lower prices.  The bargain will be in the valley in 2015.

Existing home sales will most likely remain fairly stable in the Anchorage market, and we should see a minor increase in prices.  Interest rates remain low which allows home prices to raise.  If we see an increase in interest rates we may see an eventual drop in existing home prices.  New homes will remain higher.  The valley is expecting growth this year similar to last year’s numbers.  Why?

Low gasoline prices fuel development in the Valley.  It's that simple.  There is more to this equation.  Business owners look to the valley for their workers.  If you're going to start a business this year the Mat-Su Valley is the place to do it.  There are more available workers, and according to the State of Alaska, the workers are more dependable.  There is talent available in the valley.

2015 is set to be a good year.  Yes, there is the head winds of a new governor, and the low oil prices.  These factors are also key contributors to the growth of the valley.  The Mat-su School district is more nimble than its Anchorage counterpart.  Their also our biggest employer, with growth comes more children.  This adds more schools and more jobs.  

There is also one other piece to the puzzle, TAXES!  Many Mat-Su communities already have taxes in place and pay their way.  Anchorage will feel some pain in this area, as much of the Municipality's income comes from the State of Alaska.  With lower oil prices there will be budget issues.  The Mat-Su borough should be able to deal with these budget shortfalls better than the Municipality of Anchorage.  

Now is a great time to invest in rental properties.  National home ownership rates are about 62%.  That means that 38% of your neighbors are potential renters.  Not everyone wants to own a home.  Some people would prefer that you take care of the home.  When there is economic uncertainty people don't take risks. Now is the time to take advantage of low interest rates, and high rental rates.

If you would like more information about the real estate market you can call me at 907-360-7471.  I would also be available to speak to any group that would like a speaker on this topic.

Happy New Year, see you in 2015!

What Do I see...

by Eric Bushnell

There seems to be more activity in the market right now.  I've noticed that there are more people visiting my website.  Homes are getting more showings.  And three homes I had listed are now under contract.  these sellers are very happy they listed their homes now before the busy summer months.

I'll be out this afternoon visiting with one seller and then showing a couple a home in Wasilla, they're considering purchasing.  There is optimism in the air.  Even Wall Street had a good day, stock market closed in positive territory today.

There is currently 94 homes available for sale in Eagle River; however 22 of those homes are under construction and not ready to move into at the moment.  That leaves 72 options.  Last February 26 homes sold, and then in March 80 homes came on the market, and in April/May 184 homes came on the market.  103 of those homes sold, but that a lot of competition. 

My advice is get started now.  You will most likely get the price you want for your home, if its clean and ready to sell.  Homes that don't shine will be sitting on the market in September.

Be ready, call me today for a free consultation.

Home Sales in 2013 Rise to Strongest Level in 7 Years

by National Association of REALTORS Magazine
Daily Real Estate News | Friday, January 24, 2014 The housing market has been experiencing a “healthy recovery” over the past two years, with home sales last year rising to the highest level since 2006, according to the National Association of REALTORS®' latest housing report. “Existing-home sales have risen nearly 20 percent since 2011, with job growth, record low mortgage interest rates, and a large pent-up demand driving the market,” says Lawrence Yun, NAR’s chief economist. “We lost some momentum toward the end of 2013 from disappointing job growth and limited inventory, but we ended with a year that was close to normal given the size of our population.”Existing-home sales rose 1 percent in December 2013 compared to November and reached a seasonally adjusted annual rate of 4.87 million.Existing-home sales for all of 2013 reached 5.02 million sales, 9.1 percent higher than 2012, and the largest rise since 2006 when sales were at 6.48 million at the close of the housing boom, NAR reports.  Home prices were also on the rise in 2013, up 11.5 percent over 2012, with a median existing-home price of $197,100 last year compared to $176,800 in 2012. It was the strongest gain in home prices in a year since 2005, when home prices rose 12.4 percent, NAR reports.NAR President Steve Brown says that with job growth expected this year, home sales should hold despite rising home prices and higher mortgage rates.“The only factors holding us back from a stronger recovery are the ongoing issues of restrictive mortgage credit and constrained inventory,” Brown says. “With strict new mortgage rules in place, we will be monitoring the lending environment to ensure that financially qualified buyers can access the credit they need to purchase a home.”Housing Recovery Regional SnapshotHere’s a look at how existing-home sales fared in December and for the year across the country:Northeast: Existing-home sales fell 1.5 percent in December but remain 3.2 percent higher than December 2012. Median price: $239,300, up 3.6 percent from year ago levelsMidwest: Existing-home sales dropped 4.3 percent in December and are 0.9 percent below year ago levels. Median price: $150,700, 7 percent higher than December 2012.South: Existing-home sales rose 3 percent in December and are 4.6 percent higher than December 2012. Median price: $173,200, up 8.9 percent from a year ago.West: Existing-home sales increased 4.8 percent, but are 10.7 percent below a year ago. Median price: $285,000, up 16.0 percent from December 2012.By REALTOR® Magazine Daily News

Anchorage - America's most liveable City

by Eric Bushnell

Real Estate Update

by Eric Bushnell

Real Estate update for the week of July 6, 2009.

The Eagle River saw an increase in market activity the last couple of weeks.  217 homes are on the market, 15 pended and 6 closed.  4.91 months of supply.

 

Displaying blog entries 1-5 of 5

Contact Information

Lee Realty, LLC
Lee Realty, LLC.
5050 Dunbar Drive #F
Wasilla AK 99654
Office: 907-376-0119
Fax: (907) 376-4039

 

 

 

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