The Winter Market REDUX

According to Housing Wire, it looks like the extended and expanded tax credit is truly getting buyers off the fence. And it’s not just the $8,000 for first time buyers, the new $6,500 move-up Homebuyer Tax Credit is apparently motivating buyers, according to a Campbell Communications survey of 1,500 real estate practitioners. Existing home owners accounted for 41% of home purchases in November, up from 38% in October, the survey found. Survey research director Thomas Popik says that current home owners are jumping at the credit.

Looking on a national level we’re going to dip into some of those regional sales by price.

In the Northeast, the biggest home sales by price class this year is still for homes in the $100,000 to $250,000 range. Now, in October, properties sold in that price range increased by nearly 33%, which was undeniably a good number. In November, sales in that price bracket were up, by over 75%! In fact there’s been significant rises across the board with double digits everywhere except the $750,000 to $1 million bracket which came in just under a 10% rise.

In the Midwest, previously there had been great gains in the $100,000 to $250,000 numbers, and this has continued again in November. Sales in that price category were up 70% from last year. In fact, it’s been double digit rises in almost all price brackets in this region. The only place where there was any drop off was in the $1 million and over, but those jumbo loans are still a bit harder to secure than a conventional mortgage.

In the South during the previous months, the hot money had been on properties priced below $100,000 but recently we’d been seeing a big increase in sales priced up to $250,000. Right now, the big sellers in the South are actually at the higher end of the market — people are snapping up those big southern mansions in the $750,000 to $1 million range. So we may be seeing the wind down of the cheap end but a ramping up at the top end.

Out West the market is still busy but not as crazy as it had been. We’d seen some wild numbers over the summer, particularly at the bottom end of the market. But now we’re starting to see a much more even spread of sales across the board. Again, like the South, those higher priced homes in the $750,000 to $1 million range were the big movers over last November, gaining over 58%, whereas the $100,000 and below properties were up by just a hair under 29%. The $100,000 to $250,000 bracket is also still popular in the west, with a 60% gain over last year.

Throughout the US, the $100,000 to $250,000 price bracket has seen the biggest gains, rising just under 50% from November last year. So even though it’s cold outside, November’s sales by price figures have proved to be steaming hot. It should be interesting to see how the expanded tax credit affects the market in the coming months as we see the first time buyers rush slow down, but don’t forget, the repeat buyers are now entering the picture.

One pretty obvious reason is that there is less competition than in summer, as some people will put off their hunt, particularly in colder climates.

All this could put you in the driver’s seat if you are a serious shopper. For one thing, with fewer buyers out looking, homes move more slowly so it is a better time to negotiate the asking price down — if someone really needs to sell and not as many people are seeing the house, they might be tempted to accept an offer below their asking price. Not only might they be willing to haggle over price. They also might be more willing to give concessions for paint or carpeting and they may also be more flexible on a closing date.

In winter, lenders are also less busy because they also have fewer people coming to them for home loans. With less on their plate, it is possible to expect that you’ll get more personal attention, as the process moves towards settlement.

Looking at homes in winter is definitely different. But that can be a good thing, too. For one thing, you might notice that a particular house is drafty, which is something you wouldn’t notice if you were looking at the same property in July. Drafts are an indication that the house might need new windows or that there are leaks that will need to be identified and sealed. Be sure to check the thermostat while you are in there. If it is set low and the house is still comfortably warm, it is probably well-insulated, which is a great thing to know. On the flip side, if the thermostat is high and it is not comfortable, that house will probably need insulation and may have exceptionally high heating bills.

On the subject of heating and cooling — one problem that arises in winter is that you won’t know whether the air conditioning system is in perfect working condition when the temperature outside is, well, so cold you won’t be able to test. Make sure to negotiate with the seller to set aside some money in an escrow account for repairs, should you need to do some work. If it does work perfectly, then the escrow attorney can return the money.

Your market might not be affected by weather in the winter months, but if you’re in an area that’s warm and balmy all year round, there are still some solid reasons to think about house hunting in the winter months. One, is the school year: Many families with school-age children often wait late spring or early summer, to start their house hunting. So, shopping now could possibly eliminate that entire array of potential competitors.

That’s also true in an area with a large college complex nearby. Teachers, professors, staff and all sorts of other people connected to the campus might just wait it out over the winter months, so again, if you start actively shopping now, you might avoid that group of competitors as well.

It all comes down to thinking carefully about when you’ll have the biggest advantages as a buyer. And in many parts of the country, the hottest time to house hunt might just be in the middle of winter.

Radiant heaters give off rays of heat from a hot surface. Like the sun, the rays radiate through the room, gently warming surfaces such as furniture, people, floors and walls, which in turn reflect heat back into the air around them. Radiators and open fires as the most common examples of a radiant heater, and these are a good choice for rooms with high ceilings, poor insulation, open-plan design or unavoidable drafts.

Convection heaters heat air which then circulates through the room, usually with the help of a fan. Basically it’s the forced air kind of heating that comes from your HVAC, and this is the most common type of heating we have here in America. But this method isn’t perfect for all situations; it works best in rooms with good insulation, few drafts and average-height ceilings.

Insulation is one of the most important things you want to think about in the winter months. Having a warm, cozy house throughout the winter is mostly about capturing or creating warmth, then taking measures to ensure it doesn’t immediately dissipate. To retain maximum heat during winter, and actually to help keep cool in summer, home insulation is one of the best solutions. Although insulation can be expensive to install, it’s been shown to help to lower energy consumption by up to 40% and therefore reduce ongoing energy bills. And don’t forget, there’s currently a $1500 tax credit for installing insulation in your primary residence, but you’ve only got until December 31st, to do so. To find out the full details on that program, have a look at www.energystar.gov

Here are a few other things you can do to keep cozy:

• The effect of the chill winds outside can be reduced by putting draft sealing around windows and doors, or at least placing a few draft stoppers or those stuffed cloth snakes at the foot of external doors.
• Change your window treatments. If you have nice, light curtains that are great in the summer, you might want to swap them out for some heavy or lined curtains, and draw them as soon as the sun goes down.
• Create heat zones within your house. Only heat rooms which are occupied; close the vent or turn down the radiator in the spare room and close doors to rooms that aren’t being used as this helps keep heat in the area where it’s most needed.
• If you’ve just got a small area that you want to heat, or you want to add a little more punch on a really cold day, you might look at a space heater. These are the little personal heaters that you can plug in, in different rooms, and can be fan based, convection based or a combination of the two. Keep in mind, though: even though space heaters are effective, they can be very costly to run, so only use them when you really need them.

Whatever way you choose to heat your house, you can always bury yourself in a comforter with a mug of hot chocolate and enjoy that fuzzy feeling. Winter doesn’t have to be so bad after all.