NR Market Watch

by Neil Hummel, Century 21

Greetings:

Douglas County is very fortunate to have the amenities that people are looking forward in locating here.  We have a great climate for growing a variety of produce, great location on the I-5 corridor, great medical facilities with Mercy Medical Center and the Veterans Hospital, located near great outdoor recreation with hunting and fishing, biking, and golf, and the lists go on.  However, what concerns me the most is that our population is aging with over ½ of those of us that live in Douglas County are over 55.  What that means is that we are losing our best and brightest  young people  who choose to move because of the lack of employment and limited opportunities, that we offer them.

We need to do something about this and in May 2012 our Umpqua Community College will be asking the homeowners of our area to pass a $40 million dollar bond levy that will be used to construct 3 new facilities.  This bond levy will cost the average home owner about $58 per year over a 25 year period and will offer a new Allied Health building, a Technology building and a south county facility which will provide our area with much needed jobs and training for our students now and for years to come.

As chairman of this campaign I am asking for your support because it will take all of us to work hard in our county to get our county rolling again.  We have a great opportunity to turn the tides of this very crippling economy by passage of this levy because it will have over a $200 million dollar impact on our local economy.  Also, the state of Oregon will provide a $8.5 million matching construction grant and with construction costs down plus this grant, we are afforded a golden opportunity to give our county residents hope for the future.   We are asking the property owners to invest into our future so we can stem the tide of losing our young people and improve our local economy.   This project is a win-win for our county. So please help us get out the message and vote for passage of this very important issue.  If you want more information on the levy or would like to help us, feel free to contact me.

As we compare November 2010 with November 2011, closed sales fell from 66 to 64.  Pending sales grew from 74 to 75 and new listings increased by 37.5% from 96 to 132.  Historically November is a slower month in Douglas County as far as real estate sales and our stats reflects that trend.  On a month to month basis, Douglas County showed declining sales activity when comparing the previous month of October 2011 with November 2011.  Closed sales decreased from 73 to 64 (-12.3%), and pending sales fell from 93 to 75 (-19.4%).  New listings saw a rise of +7.3%, up from 123 to 132.

When comparing November 2010 to November 2011, the average sales price dropped 6.0% ($165,700 v. $155,800). However,  a comparison of the month prior October 2011 to November, shows a +11.1% rise in the average sales ($140,200 v. $155,800).  The average sales year to date is down -2.0% ($155,600 v. $152,500).

We want to wish you and your family a very Merry Christmas and Happy New Year.  Be sure to include all of Military troops and their families in your thoughts and prayers during this time for all that they do to help us enjoy our liberties.  God Bless all of you and your loved ones, and God Bless America.

by: Neil Hummel, Century 21

GREETINGS:

Our local economy continues to suffer, in fact it stinks.   One of largest employers in our area, the Swanson Timber Company just laid off 400 until the end of the year and plans to revaluate what they will do then.   The demand for finished lumber continues to decline nationwide and worldwide even though the demand for raw logs exports are up.

These are reasons why we need to pass the UCC bond levy in May to offer hope of future employment in the growing health care and technology field.  This is critical for the long term well being of our community and the people that live here.

We are, however, hearing that many of our local retailers are hiring for the holidays and there seems to be an uptick in consumer confidence.  Our local Wal-Mart is expanding its current facilities and it will soon become a “super Wal-Mart” which will include a grocery store.

Gradual Recovery for Housing and the Economy is expected in 2102, according to our lead economist at the National Assocation of Realtors, Lawrence Yun.  He went on to say that home sales should be stronger in 2012 even though they struggled in 2011.  “Tight credit restrictions have been holding back home sales and consumer confidence has been shaky.  Nonetheless, there is a sizeable pent-up demand based on population, the growth of jobs in certain key sectors of our economy, and lower than normal interest rates will likely contribute to the growth in home sales.”

With the continued interest in the elections in 2012, Yun feels that many consumers will once again feel good about the nation’s economy, depending on the outcome of their specific region.   In other words, our economy will grow more regionally than nationally, Yun feels.

Of course, we are seeing that already with the recent surge of housing demands in Williston North Dakota when oil rigs are popping up like weeds.  In fact, Williston is expected to grow from 30000+ to 60000+ in the next 2 years or less.

In Douglas County October Residential activity was down when you compare October 2011 to October 2010 when closed sales fell from 80 to 73 (-8%).  Pending sales remained constant at 93, while new listings dropped by (-28.5%) from 172 to 123.  When you compare the respective month of October in 2010 to October 2011, the average sales price dropped from $163,600 to $140,200 (-14.3%) .  The total market time for this same period, October 2010 to October 2011 also dropped from 176 days to 154 days which is significant.

On a month to month basis, Douglas County showed declining sales activity across the board when comparing the previous month of September 2011 with October 2011.  Closed sales decreased from 82 to 73 (-11%), and pending sales fell from 100 to 93 (-7%).  New listings saw a drop of 11.5%, down from 139 to 123.  At this month’s rate of sales, the 1,027 active residential listings would last about 14.1 months which is the lowest October inventory rate of the last 3 years.

Cathy and I had the pleasure of attending the 236^th Birthday of the Marine Corps in the Portland area, hosted by the Recruiting Station of Portland.   There were close to 400 Marines and their guests in attendance honoring past and present Marines.   It was a lively and eventful evening.

Please keep our Military men and women and their families in your thoughts and prayers and be thankful for what you have and the wonderful life that you live because our servicemen and women are preserving our freedoms.   Happy Thanksgiving and enjoy your time with your family and friends.

From Neil Hummel, Century 21

Greetings:

Congress and the President did come to some resolution regarding the debt ceiling and cutting some of the costs of running the government.  However, to take the heat off Congress and the President, they created another Super” Elite” Committee made of an equal number of Republicans and Democrats Senators to examine ways to trim the cost of government.  That is all we need,  another Committee!  We all know the definition of a two hump camel, “that is a horse that goes to a committee and comes out a two humped camel.”  Committees are nothing more than a copout for they are only temporary and advisory at best with no authority to enact what they suggest.  As a nation, we need to be careful that our Congress and President become nothing more than entities that study and recommend rather than comprise and enact laws.  However, we must keep in mind that changes in Washington are slow and grinding for a reason, it is called a democracy.

Nationwide real estate sales continue downward in the West and the South.  There has been a slight increase in sales in the Midwest and Northeast.  There are a number of reasons for this, mostly attributed to the heavy flooding and tornado damage in those regions.  In fact, new housing construction is up which is some good news for homebuilders.  NAR chief economist, Lawrence Yun, said “there is a real tug and pull on the market. “  Most potential buyers are finding that the lender requirements have been so harsh that many of them can’t qualify to buy, even though they want or need to buy.   I am often asked, “is there an answer to solving the domestic housing crises?”  There is in my opinion, reestablish the buyer’s credit for all buyer’s  (not just first time homebuyers)  that was so successful 2 years ago.  In the short term, it will help get rid of the surplus of houses on the market and in the long run, get people into homes to fulfill their American Dream, homeownership.

July’s real estate prices and activities continue to decline in terms of closed sales with year to date at 507 which is down from 540 a year ago. (-6.1%)  Comparing June 2011 to July 2011, closed sales fell from 84 to 65 or (-22.6%).  Pending sales for this same period dropped from 95-79 (-16.8%).  New listings increased from 179 to 213 (+19.%).  At this month’s rate of sales, the 1,172 active residential listings would last approximately 18 months which is up from 11 months last month.  Even though, the amount of closed sales and pending sales were down, the average sales price rose from $126,600 to $171,400 (+35.4%) . This is one of largest increases in value we have seen for awhile.  This is great news, slowly we are moving toward recovery. The Sutherlin-Oakland area continues to see the largest increase in value at +8.6% with the average sales price at $174,500. The Green area saw the largest decrease in value at -18.8% with average sales price at $124,300. The total market time has increased to 198 days so you see it is taking over 6 months to sell the average sales price home in Douglas County with is up from 169 days a year ago.  As I said earlier the average sales price has increased to $171,400 which is where prices were in January 2005 which is 31.4% below where prices were in 2007.

Cathy and I are new grandparents for the fifth time!  Yes, Clark Harris Hummel, was born to Jamie and Adam on the 17^th of August.  He is good healthy and handsome dude, which will make him a good candidate for The Marine Corps Officer Training School in about 22 years.  We are real proud of all 5 of our grandchildren, Chance, Ashlyn, Andi, Ryann, and now Clark.  We are truly blessed.

From: Neil Hummel, Century 21

WHAT CAN BE DONE IN WASHINGTON?   We all have our own opinions about should be done to resolve the deadlock in Congress but no action is not an option.  We all say that something needs to be done about reducing the uncontrolled spending at the Federal and State level, but as soon as they start talking about cutting back on this or that program, we all start whining about it.  In other words, cut those programs or entitlements that don’t affect me.  That is where everything gets complicated real fast.

I am confident that Congress and the President will get this resolved and I am certain that it will not please everyone but that is the beauty of our democratic process.  A wise old man once told me, “when people get together to resolve a conflict and the parties come out both still upset, that is good for neither party truly got everything they wanted.”

Write or call you Congressmen and Congresswomen or Senators and voice your opinion, for that is how to practice our the democratic government. Remember, if you do not express your opinion, you will end up with something you won’t like.  It is your right to get involved and stay involved if you want to see things change.   As you know, if you don’t vote or don’t get involved, the only person you can blame is yourself.

Real Estate activity in Douglas County is following the National and State trends of decreasing prices and decreasing sales.  Comparing June 2010 with June 2011, closed sales went down 92 to 84 (-9.5%), new listings fell from 247 to 179 (-27.5%) however pending sales grew from 93 to 95 (+2.1%) which is good news for pending sales lead to closed sales.  As we compare June 2011 to May 2011, we see that the average sales fell from $160,000 to $126,600 (-21.2%).  The average prices today for residential properties have dropped from $250,000 in 2007 to the present price of $126,600 (-49.3%). This was the most dramatic drop in prices that I have seen occur in the 38 years I have been in real estate.

I am often asked, “how long will this downturn in prices be?”  I feel it will be at least 2015-2016 before we see any type of stabilization in house prices.  My advice to sellers is simple, if you need (more…)

From: Neil Hummel, Century 21 Real Estate

Greetings:

Life is full of events this time of the year from graduations, weddings, recreation, and relaxation.  I had the distinct honor to give this year’s commencement speech to the graduating class of 2011 at Umpqua community college.  I felt very honored and humbled to speak to the 500+ graduates and their families about some of my thoughts about the last 38 years in the real estate business in our community.  My wife and I had graduated from UCC in 1969, so it was very interesting to reflect back when I sat in their seats awaiting our diplomas.

In Douglas county closed sales went up from 83 to 94 (+13%) when comparing may 2010 to may 2011.  Pending sales also increased from 72 to 89 (+23.6%) which is a good indicator of future closings.  New listings fell from 193 to 189 (-2.1%) which means that we have just 11.5 months of listing inventory on the market.

This is the lowest level of listing inventory for the last 2 years.   The average sales price continues to go down year to date and is now at $154,700 (-7.5%).  That means again, that the sellers’ are willing to adjust their prices in order to get their homes sold and have been helping the buyers’ with incentives in order to close.  In fact, nearly all the sales that we put together have sort of sellers’ concessions.  The year to date comparisons show a downward trend when comparing January-may 2010 with the same period of 2011 in closed sales 364 to 355 (-2.5%), pending sales 425 to 384 (-9.6%) and new listings declined 1,120 to 867 (-22.6%).   Total marketing time in may 2011 has increase to 191 days which is up from 156 days in may 2010 (+22,4%).

The average sales price continues to drop in our area, in fact, prices in the myrtle creek area went down year-to-date by 20.6% year to date which is the most significant in our county.  In Roseburg, the Melrose area’s average sales price declined by -13.6% with the green district close behind at -12.6%.  However, the greater northern part of Douglas county (drain, Yoncalla and Elkton) prices increased by + 5.2% which is due in large part to a few large ranches selling.  The grand total of average sales price in Douglas County is a negative 4.2% which is the lowest drop we have seen this year.

With prices continuing to drop, sellers need to continue to adjust their prices in line of what is selling and closing.  We are also advising our sellers to offer buyer incentives because nearly 80% of all the offers that buyers are writing up are asking for sellers to pay up to 3% toward buyer’s prepaids and closing costs at all price levels.

Remember to keep our military and their families in your thoughts and prayers because of their sacrifices; we continue to enjoy our freedoms.  Have a wonderful 4th of July and celebrate our country’s birthday in style.

Inman Reports show 30-year fixed-rate mortgages have fallen for the past seven weeks and now average only 4.55%. Average Rates on 15-year fixed rate mortgages are down to 3.74%.

The real estate sector continues to struggle with prospective buyers who cannot obtain financing and with low levels of consumer confidence. Mortgage rates are very low and home prices are very low.These days, however, will not last, and given the relatively long time horizon of home ownership, I suspect many will someday wish they had taken advantage of the opportunities today offers.

I talked today with a young lady who graduated from Umpqua Community College last year. She is working in her chosen field and recently married. She and her husband also recently purchased their first home, which she said was a great deal. We need more of that.