“As seen in 50 plus Magazine, Bruce’s 2012 Real Estate Prediction”

2012 Real Estate Forecast…What to Do?

I am fortunate to have a view of the real estate market which most folks just don’t have. I sell many homes each year and talk to mortgage lenders, buyers, sellers, home inspectors, stagers, contractors and so many others connected in some fashion to the housing market. In my conversations we discuss the current state of the market as well as their prediction or feel for the future based on their client’s comments and views of the present health of our local real estate market as well as the expectations for the future. I want to share those views with you, the reader, so you can make plans for your home sale when the time is right for you. Also, you can share this information with your children and grandchildren who may be on the sidelines waiting for the right time to jump into the housing market for their very first purchase.

The overwhelming sentiment is that we will not see appreciable appreciation of our single family homes for another two to three years. But the good news is that price depreciation is slowing down to a single digit decline and moving towards stabilization. That is very good news, as prices have fallen since 2006. That has been a 5 year fall in home values for an average decline of 20-40%, depending on location. Inventory of homes for sale is also falling which is a sign of recovery. Therefore, do we wait for that moment when we know the bottom is here and prices are on the rise? My experience shows me that the exact moment of price appreciation is never truly known at the time it is happening. It is such a gradual process that we can only time the market by looking backwards, which is very difficult to do! When looking at history, patterns are clear and easy to see, but when in the moment very difficult to know for sure. The complicating factor to timing the market is interest rates. Even if we wait until the perfect time to sell or buy, interest rates can rise, causing our timing to falter. For every 1% of interest rate rise, buyers lose 10% of purchasing power. In other words, if the interest rate rises 1%, a buyer would have to pay 10% less for the same payment. Therefore, prices may begin to rise, then fall a bit if rates go up. This is capitalism at is core.

Another factor that we don’t see at the moment is the many sellers waiting on the sidelines to put their home on the market. Once recovery is felt, many homeowners will put their home on the market as they have been on the sidelines for the past 5 years waiting for the right moment to sell. This acceleration of inventory may stunt the growth of the home sale market temporarily until this new inventory surge is absorbed. Add to that the large number of baby boomers waiting to downsize from larger homes. This may cause homes with great square footage to fall in price until they too are absorbed into the market.

The bottom line is that our real estate market will show positive signs of recovery, then may fall back and then recover and move forward. This start and stop market recovery and slowdown will probably be the norm of our real estate market for a few more years. Therefore, prices will be somewhat stagnant for at least 2 more years with prices remaining stable without decline.

This housing stability will offer great opportunity for both buyers and sellers. This is a rare type of market where neither purchaser nor home seller may have the advantage. That is a great time for buyers as they can feel good about the price they pay since prices will not be falling or rising. One of the great fears of today’s first time buyers is purchasing a home at today’s prices and being under water a year later! Stability is critical to buyer’s confidence in their first home purchase.

As a seller, one can remain confident that the price they attract will not shoot up as in the boom years, causing upset when feeling they should have just waited to cash in on the huge appreciation seen in the 2000-2006 years. One can remain fairly certain that the price obtained in 2012 will be somewhat close to the price obtained in 2014. So why wait if a lifestyle can be improved today by selling a home that no longer meets today’s needs.

Stable prices are here at this time for buyers or sellers. As a seller, understanding today’s buyer is critical to achieving success in one’s home sale. As a buyer, conditions have never been better as to inventory, interest rates, and price. Therefore, look at lifestyle as the determining factor for making your buy or sell decision in real estate. You will be considered ‘lucky’ for making that decision when afforded the luxury of looking back in time as to how you timed your decision as to the constantly changing market!

Bruce Nemovitz is a Senior Real Estate Specialist, as well as Certified Senior Advisor. Bruce has sold residential homes in the four county Milwaukee-Metro areas for 33 years. He has just received the 2010 “Realtor of the Year” from the 3,800 membership of the GMAR (Greater Milwaukee Association of Realtors). He has been listed in Milwaukee Magazine’s 5-Star Agents list for three years in a row. As such, he’s one of only a handful of Realtors who are continually included in the top 7% in client satisfaction in the Milwaukee Metro area. He’s rated A+ by the Better Business Bureau, and was a finalist for Concordia College’s Ethical Business Leadership Award. He has  published a book called “Moving in the Right Direction”, A Senior’s Guide to Moving and Downsizing.  He works with his wife Jeanne at Realty Executives Integrity. Please feel free to call Bruce or Jeanne with any real estate questions you may have at 262-242-6177, or email at Bruce@BrucesTeam.com. You can go to their website at http://www.brucesteam.com/ and view the many articles and important information related to moving and downsizing!

Understanding Your Options Under Pressure

About 17 years ago, I decided to focus my practice on older adults, ages 75-90. My hope was to help this group plan ahead to avoid quick decisions. All too often I would receive a panic call from a senior in trouble. A health change forced hasty decisions that lead to unhappiness and sadness. Staying in a home that no longer meets the physical and mental needs of a long time homeowner can lead to challenges such as falls, isolation, inability to keep the maintenance up, etc. Security issues can force a person to become isolated as well as fearful.

The great recession has exacerbated this situation by keeping folks in their homes with so many waiting for the real estate market to rebound and restore the home asset to 2006 levels. By waiting to make a move that could have been done when relatively healthy, the door opens to a move that is forced and done with little planning due to the urgency of the moment.

Today, the calls I receive have shifted away from seniors and more from the children of seniors who now have to make the decision for a parent or parents that have stayed too long in an unhealthy environment. This has lead to the family of the older adult burdened with the pressures of selling the home, dealing with governmental agencies in relation to Medicaid and determining where their loved one will spend the rest of his or her days.

No parent would ever wish this responsibility to be placed upon a child or family. However, by waiting for their home value to rebound, the family becomes one in crisis and too often siblings can turn on each other in the attempt to make the right decisions for their parents.

If planning is done when decisions can be thought out and made with deliberation, senior housing options are plentiful and can fit almost any budget. There are governmental agencies in every county ready to help if called upon for advice and information. There are even senior planners that specialize in guiding older adults so that one’s health and well-being are foremost in decisions made when considering new housing options. One can visit any senior community and a marketing director will offer the information needed to assess finances as well as physical and mental needs.

If you are a senior who knows that your home no longer meets your needs for safety and security, talk to your trusted advisors and get an objective opinion as to what should be done to enhance health needs as well as offer a higher quality of life. Moving away from isolation and fear to security and new friends cannot only extend one’s years of quality living, but can also avoid placing your family in a crisis situation! 

  Bruce Nemovitz is a Senior Real Estate Specialist, as well as Certified Senior Advisor. Bruce has sold residential homes in the four county Milwaukee-Metro areas for 33 years. He has just received the 2010 “Realtor of the Year” from the 3,800 membership of the GMAR (Greater Milwaukee Association of Realtors). He has been listed in Milwaukee Magazine’s 5-Star Agents list for three years in a row. As such, he’s one of only a handful of Realtors who are continually included in the top 7% in client satisfaction in the Milwaukee Metro area. He’s rated A+ by the Better Business Bureau, and was a finalist for Concordia College’s Ethical Business Leadership Award. He has published a book called “Moving in the Right Direction”, A Senior’s Guide to Moving and Downsizing.  He works with his wife Jeanne at Realty Executives Integrity. Please feel free to call Bruce or Jeanne with any real estate questions you may have at 262-242-6177, or email at Bruce@BrucesTeam.com. You can go to their website at http://www.brucesteam.com/ and view the many articles and important information related to moving and downsizing!