New Albany Ohio Real Estate

I just read an article in the Wall Street Journal real estate newsletter which really helped to put a new spin on real estate in New Albany, Columbus and the Midwest as a whole. We keep hearing about how bad the real estate market is but think about what you can actually buy here versus some other parts of the country.

Using $400,000 as a comparison:

In New Albany, you can buy a 3600 square foot home overlooking a golf course, with a screen porch, a finished recreation room in the lower level, 4 bedrooms, 3.5 baths and a 3 car garage.

In New York City, that same $400,000 will buy a 400 square foot studio apartment on the Upper East Side with a queen size Murphy bed, a new kitchen with granite and stainless steel appliances, hardwood floors, a doorman and a bike room.

For $400,000 in Miami Beach you can buy a 1520 square foot condo with 2 bedrooms, 2 baths that 1,520-square-foot condominium. The condo, built in 1963, has bay views from every room, wood floors, kitchen appliances in mint condition and a parking space.

So, while prices on real estate in New Albany are off the peak of the market, your housing dollars still go a long way. It really is a good time to buy a home! Contact Kate or Tony to discuss home buying options in New Albany or the Greater Columbus area.

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Kate & Tony have sold more Hampsted Village Homes than the next 6 REALTORS® combined!

When it comes to their business goals, Kate & Tony have a shared vision: client comes first, excellence is the standard, and integrity is key. Setting them apart are cutting edge marketing advantages like the custom-designed site, www.newalbanyohio.com with a satellite mapping tool to dynamically plot neighborhoods. The results speak for themself.  If you need your home sold in Hampsted Village in 2008 – you need to call Kate & Tony!

Hampsted Village Listings Sold Since 2000:

* Based on listings sold 2000-2007 per the Columbus Board of REALTORS® MLS. Click here for a brief tour of Hampsted Village!

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The procedure for obtaining a loan continues to tighten as the banks, investors, and HUD figure out how best to insure that jumbo mortgages are secure investments.  The US Department of Housing and Urban Development (HUD) announced on April 1, 2008 that jumbo mortgages (loans exceeding the conforming loan limit of $417,000) may require 2 appraisals in order for a buyer to obtain a loan commitment.   According to the HUD Mortgagee Letter, a 2nd appraisal may be required when 3 requirements are met:

• The loan amount, excluding the upfront mortgage insurance premium, will exceed $417,000, and
• The Loan-to-Value equals or exceeds 95%, and
• The property is determined as being in a declining market.  A declining market is determined by either the appraiser or the lender.

Every time I speak with one of our lenders, it seems there are more and more changes that need to be understood and incorporated into the mortgage approval process.  However, this is probably a good change… though it could slow down or add additional cost to the process.  I find myself counseling our buyers that there is a little bit of a learning curve as everyone becomes more familiar with the sweeping changes that have taken place in the mortgage industry.

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As I was reading the “Business Page” of the Columbus Dispatch on Tuesday, I was struck once again, with how totally local real estate actually is. The article I was reading indicated that the decline of sales in Columbus was not as bad as those reported by the Ohio Association of Realtors for the entire state of Ohio. I decided to take it one step further and look at New Albany specifically. The Ohio Association of Realtors reported that sales declined by 9.6% in Ohio and the Columbus Board of Realtors reported a 5.8% decline in home sales in February. New Albany unit sales in February were actually up slightly over 2007 and year to date are only 2 units off the 2007 pace. I’m not saying that we have seen the end of this challenging market but there is some good news and I think it’s important to share it!

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Yes, absorption is the correct term for Sponge Bob’s ability to soak up water and the same holds true in the real estate industry. In real estate, the absorption rate is the amount of time, generally expressed in months, that it will take a market to “absorb” the current inventory based on recent history. In other industries, this measurement may be called turnover rate or simply weeks or months of supply.

As I’m sure most of you know, Kate and I have a background in retail where you live and die by turnover rate. If the inventory is turning too fast, you’re going to run out of stock and have empty shelves; too slow and it’s time to pull out the red pen and take a mark down!

In real estate, you often hear references to it being a Buyer’s Market or a Seller’s Market. The National Association of REALTORs suggests that a market is in balance when there is a 7-9 month absorption rate. When inventory is six months or less – it’s a seller’s market as there is more demand than inventory. Homes sell quickly and for close to or sometimes above list price. When the months of supply exceed 9 months, it’s considered a buyer’s market. Homes take longer to sell and the list price sales price ratio slides.

How do you figure the absorption rate? It’s a simple formula:

Inventory ÷ # Units Sold x Time = Absorption Rate

For example, if the market you are evaluating (subset) has 12 homes on the market and 6 homes sold in the past six months, the absorption rate would be 12 months.

The key is to understand the subset. In New Albany, there are many subsets, defined by price, neighborhood, age, location etc. Remember, real estate is local…very local. The absorption rate of a $1M brick home has little to do with understanding the market or absorption rate for a $400,000 vinyl sided home in a different neighborhood.

If you are interested in the absorption rate in your neighborhood, try out our free MLS Market Snapshot feature and have a look. Of course you can always drop me an email at tonyt@newalbanyrealty.com or call 614-939-1234 and I can run some quick numbers for you.

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National Real Estate Scenarios Don’t Apply to Columbus, Ohio!

I just read an article from the Wall Street Journal’s “Real Estate Journal Today” – an online service sponsored by www.WSJ.com. The head line reads “Kimmel Home Listed for $81.5 Million“. That headline will definitely catch your attention, but is it really relevant in Columbus Ohio? I don’t think so. This article is perhaps good fodder for “Entertainment Nightly” but is in no way reflective of the actual real estate industry in New Albany, Ohio. The article goes on to talk about a home where a $3 million price reduction did not generate a sale.

The media would have you believe that since the luxury real estate market in Palm Beach, New York City, and Los Angeles is experiencing a necessary and significant correction, that it follows suit that we should experience the same correction in Columbus. When the Columbus Board of Realtors recently polled some of it’s members with the question “How’s the Housing Market”, one of the most perceptive responses came from Louise Potter with Keller Williams when she said:

“Our market is a matter of perspective vs. media spin. Interest rates are incredibly low and falling, 5.5% today, the supply is showing signs of realigning with demand and there are great opportunities to invest and own homes…the long term picture in our market is one of stability and conservative growth.”

As we know, not all markets in the country are seeing positive signs of a recovery but in New Albany, Ohio we don’t have a huge correction to recover from. As a matter of fact, I was recently working on a market analysis for a potential seller and in doing my research, there was only a 4.5 month supply of homes in their home’s price range which is very good news for that seller.

I guess my point is, get the local real estate facts as it applies to your home and don’t rely on the media for your information. Tony and I are always available to consult with and can help you put your home into the proper real estate perspective.

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As I was reading the Columbus Dispatch on Sunday, a Chase ad for a Home Equity Line of Credit caught my eye. It advertised variable rates on Home Equity loans as low as 4.99%. At first glance, this looks like it could be great, and in certain situations, probably is. However, if you have any plans to sell your home in the next couple of years, I urge you to give it a lot of thought and here’s why. When you take out a home equity loan, you are in essence, taking the profit out of your home early.

Tony and I have come across quite a few real estate situations in New Albany over the past 12 months where a seller’s first mortgage combined with their home equity credit loan barely equaled the current market value of the home. When you layer in the cost to sell your home, it leaves even less. Again, there’s nothing wrong with accessing a home equity line of credit. Sometimes the interest on these loans is deductible where other types of interest are not. It’s just important to remember that when you do take out the loan, you are spending the equity (or profit) that you may have on your home leaving less net proceeds at sales time.

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It’s no secret that real estate and banking have been in the news for all the wrong reasons during the past 12 months. Yesterday, we received great news from our preferred lender, Scott Miller, at National City Mortgage.  Interest rates are at long time lows right now.   Yesterday, the rates for a 30 year fixed rate dropped to 5.49% and the rate for a 15 year fixed mortgage dropped to 4.99%. According to The New York Times, most economists don’t believe rates will decline much more in the near future.

We’re not sure if we will see another time in the next 10 years where extremely low interest rates are coupled with lowered home prices.   This unusual alignment of low interest rates and low sale prices makes for a very opportunistic time to BUY a home, particularly if you would like to trade up to a larger home.   If you are planning on SELLING, the lower rates allows more people to qualify to purchase your property…producing a larger potential pool of buyers.

Tony and I would love to talk to you about any questions you may have about your current home or the market in a neighborhood that interests you.  Just call us or email us to arrange a confidential consultation.  We look forward to hearing from you.

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Built around an 18 hole “links style” golf course designed by Barry Serafin, New Albany Links continues to offer executive homes in one of New Albany’s most sought-after neighborhoods. This community offers all the amenities of country club living including a neighborhood swimming pool, Har-Tru tennis courts, fitness center, a beautiful clubhouse with excellent dining facilities, and of course, golf! 30 homes sold in New Albany Links this past year at an average sales price of $390,000. It took an average of 143 days on the market (DOM) to sell these homes and the average price per square foot was $130. The average List to Sales Price ratio was 96.5%. In 2006, 38 homes sold in New Albany Links at an average sales price of $372,000 and average DOM of 137.

Homes Sold in New Albany Links in 2007:

*This representation is based on data supplied by the Columbus Board of REALTORS® or it’s MLS from 2006.  Data maintained may not reflect all activity in the real estate market.

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A year end review shows that while the real estate market slowed down in 2007, is it may not be the doom and gloom picture painted by the national media.  In fact, Forbes Magazine recently ranked Columbus as the 3^rd most stable housing market of the 40 largest American cities. In Hampsted Village, the average 2007 sales price was $358,800, compared to 2006, where the average sales price was $355,891. The biggest difference in comparing 2006 to 2007 is the amount of homes sold: 56 in 2006 and 30 in 2007. Unit sales in New Albany overall were off by about 10% over 2006 while the average sales price fell about 6%. The good news is that beautiful Hampsted Village continues to not only be a great place to live, but also holds value in the market place.

Homes Sold in Hampsted Village in 2007:

*This representation is based on data supplied by the Columbus Board of REALTORS® or it’s MLS from 2006. Data maintained may not reflect all activity in the real estate market.

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