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Billings, MT Real Estate News

By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
To start I thought it might be useful to give some context to new construction as compared to other industries or measures we might look at and where the other bench marks or measurements would be if they had “recovered” as much as new construction. I use the percentage drop of new construction from the 50 year average (approximately 48%) instead of the drop from the peak (approximately 68%) to make the comparisons less dramatic and even doing that I believe the numbers are stunning   Dow average peak  14,164    current 13,046    drop from peak using new construction, the dow would be                          7,356   Oil barrel  peak               145.28                 current               107.06                 drop from peak using new construction, the oil would be                  ...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
A little perspective is always a good thing to try and sort reality from fiction. Right now nationally resale’s of existing homes are running in the 4.8 million category that is with interest rates that make it pretty close as cheap to own as it is to rent. The second is, news on the foreclosure front touting how much it has dropped as the saying goes “figures don’t lie but liars figure” So the thought to ponder, with about 3.8 million homes either 90 days late or in foreclosure  which is about 88% higher than  “normal” (ignoring all the delinquent less than 90 days) how long does it take for the market to recover?     Feb-12 Feb-11 Delinquent 7.57% 8.80% In Foreclosure 4.13% 4.15% Less than 90 days 2,059,000 2,495,000 More than 90 days 1,722,000 2,165,000 In foreclosure 2,065,000 2,196...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
HERE WE ARE ROARING THROUGH 2012. TWO MONTHS GONE AND TWO MONTHS OF WINTER WITH JUST SOME COOL WEATHER, NOTHING LIKE THE LAST TWO WINTERS IN TERMS OF SNOW.  INTEREST RATES ABOUT AT 3.89% FOR A 30 YEAR FIXED RATE MORTGAGE, 20% BELOW LAST YEAR AT THIS TIME; THOSE TWO THINGS COMBINED ARE SHOWING UP IN THE HOME SALES IN YELLOWSTONE COUNTY. CLOSED SALES AT A NICE CLIP ABOVE 2011, IN THE FIRST TWO MONTHS, ALTHOUGH I WOULD CONSIDER IT A BIT OF MISS MATCH OF A COMPARISON WITH THE FACTORS MENTIONED ABOVE. THE REAL BRIGHT SPOT IS THE DECREASE IN INVENTORY THAT ALONE WILL GET THE MARKET BACK TO BALANCE FASTER THAN INCREASE SALES. THE BALANCE OF THE INVENTORY DROP MEANS SELLERS WERE DISAPPOINTED WITH WHAT THE MARKET WOULD ALLOW FOR A SALES PRICE AND HAVE MOVED TO THE SIDELINES UNTIL PRICING PROSPEC...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
When reviewing the information about new construction whether permits, starts, or sales, if as many talking heads profess, that housing is “recovering” why are all categories 52 to 59% off the fifty year averages and down 72 to 76% from the peaks. And construction employment has dropped from 8,045,000 million people employed to 5,436,000 million people employed. The question i have to ask myself, if you go from no pulse in intensive care to a pulse are “recovering” or just not dead.     actual total for year permit issued   start of construction     multi single   multi single single sales 2010: Year to Date 604.6 447.3   586.9 471.2 323   2011: Year to Date 611.9 413.7   606.9 428.6 302   year over year + or  - 1.21% -7.51%   3.41% -9.04% -6.50%                     seasonally adjusted ...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
2011 END OF THE YEAR REPORT THE GOOD, THE BAD, THE DIRECTION MY FIRST COMMENT ABOUT 2011 IS, I AM GLAD IT IS IN TH REAR VIEW MIRROR. MY BELIEF IS 2011 GOES INTO THE RECORD BOOKS AS THE LOW POINT IN REAL ESTATE UNIT SALES AND MOST PROBABLY PRICING IN THIS REAL CYCLE IN YELLOWSTONE COUNTY. THAT BEING SAID THAT DOES NOT MEAN A BOUNCE IN 2012. WHAT IT MEANS IS, MOST PROBABLY, STABILITY WITH A BIAS TOWARDS AN UPWARD MOVEMENT. THE MOST DIFFICULT ASPECT OF 2011 WAS THE FINANCING ARENA, ALTHOUGH RATES ARE INCREDIBLE, THE HOOPS TO JUMP THROUGH TO OBTAIN FINANCING ARE NOT INSIGNIFICANT AND LEAD TO DISCOURAGEMENT OF PURCHASERS DURING THE PROCESS. 2011 WAS THE HIGHEST RATE OF FAILED TRANSACTION THAT I HAVE EXPERIENCED IN MY THIRTY YEARS IN THE BUSINESS.  I HOPE 2012 SLOWS THE CHANGES WITHIN LENDING...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
Here is the headline from yahoo financial news Housing Starts Surge to 1.5 Year High, Futures Rally Here are the actual numbers--- whom is trying to sell what to whom ? ---- swamp land comes to mind       FOR IMMEDIATE RELEASE TUESDAY, DECEMBER 20, 2011 AT 8:30 A.M. EST   actual total for year permit issued   start of construction     multi single   multi single single sales 2010: Year to Date 551.0 416.4   553.1 444.5 256   2011: Year to Date 561.4 384.4   564.9 399.4 236   year over year + or  - 1.89% -7.68%   2.13% -10.15% 7.81%                     seasonally adjusted                 permits issued       permits issued total       one unit structure       includes multi family     permits issued   435     681                         peak year   1798     2363       permits % drop from...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
The national association of realtors has acknowledged that they have actually overstated home sales. They have also stated they are in the process of revising their methodology in coming up with their figures and will restate their “estimates” in the “near” future. To give you an idea of how their restatement may look here is an estimate of sales then two graphs on show the numbers below and one showing new single family sales to give a visual and actual bench mark for comparisons Here is what the adjustment to the NAR sales would look like using the HousingTracker data (this is NOT the NAR adjustment):Year Sales, as Reported YoY Change, as Reported Adjustment Sales, Adjusted YoY Change, Adjusted 2007 5,652,000 -12.7% -2.8% 5,495,000 -15.2% 2008 4,913,000 -13.1% -4.5% 4,691,000 -14.6% 2...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
The market positives inventory down and number of sales  is closing the gap on 2010, prices are down about 3% year over year same time period.My belief is 2011 will go down as the low point in the market place this cycle and by the end of the 1st quarter we should be seeing year overyear increase in sales and at the minimum stable prices. this should help give both buyers and sellers confidence which will improve market conditions from both perspectives. Market update at glance   Year  Percentage Increase  Yellowstone County   11/30/2011   2010 2011 or -Decrease                 Residential  Closed Sales Units   1601 1542   -4%                 Residential  Pending Sales Units   193 198   3%                 Residential  Active Property For Sale 870 766   -12%                 Average sales...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
THOUGHT IT MIGHT BE NOTE WORTHY TO LOOK AT HOME SALES, EMPLOYMENT, INTEREST RATE AND POPULATION GROWTH TO SEE IF LENDING REQUIREMENTS ARE HAVING MORE OF AN EFFECT ON THE MARKET THAN THE OTHER THREE VARIABLES THAT AFFECT HOME SALES. THE TREND BEGINS IN 2007.   TO START OFF WITH A LOOK AT PRICING OVER THE LAST FIVE YEARS. SLIGHT PRICING DIFFERENTIAL BETWEEN WHAT MOST WOULD CALL THE CITY OF BILLINGS COMPARED TO THE COUNTY. IN THE COUNTY ARE HOMES THAT HAVE MORE LAND ASSOCIATED WITH THEM SO OVERALL PRICING IS A LITTLE HIGHER.    THEN USING THE ABOVE INFORMATION THE NEXT STEP IS TO COMPARE THE EFFECT OF INTEREST RATE ON MONTHLY COST TO OWN. I USED THE ABOVE COUNTY AVERAGE AND MEDIAN SALES PRICES AS LOAN AMOUNT, A 30 YEAR LOAN AND ADDED 25% FOR TAXES AND INSURANCE. A SMALL INCREASE IN PRICE (...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
ONLY ONE OTHER TIME IN THE PAST THIRTY YEARS HAVE I SEEN WHERE IT IS CHEAPER TO OWN THAN RENT IN YELLOWSTONE COUNTY. THAT TIME THE LATE 1980'S, CAUSED BY THE RECESSION AND FORECLOSURES OF THAT PERIOD OF TIME. YELLOWSTONE COUNTY WAS LIKE LAS VEGAS IS NOW WITH OVER 600 FHA REPOS AND 100 VA REPOS ADVERTISED IN THE PAPER EVERY SUNDAY. HOME PRICES HAD FALLEN FROM FORECLOSURES AND POPULATION DECLINE IN YELLOWSTONE COUNTY AND INTEREST RATE HAD DROPPED FROM 13% ON A 30 YEAR MORTGAGE ALL THE WAY DOWN TO THE REASONABLE 9% RANGE. THIS TIME AROUND WE HAVE SEEN PRICES DECLINE SLIGHTLY AND INTEREST RATES SHARPLY DECLINE FROM 6.38% TO 4.11% FOR A 30 YEAR MORTGAGE. RENTS HAVE MOVED UP AND POPULATION IN YELLOWSTONE COUNTY HAS ALSO INCREASED.  JUST LIKE THE LAST TIME AROUND THERE WILL BE A WINDOW OF OPPO...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
When I look at the numbers they don’t paint a pretty picture starts and permits that include multifamily up 0.2 and 0.6% for the year in actual activity . when looking at the seasonally adjusted numbers  every category 53 to 60% off the fifty year average . not what I would call any kind of recovery almost 2 ½ years after the recession “ended”   actual total for year permit issued start of construction     multi single   multi single single sales  2010: Year to Date 510.1 386.5   512.5 411.6 256   2011: Year to Date 511.1 354.2   512.8 366.1 236   year over year + or  - -0.20% 8.36%   0.06% -11.05% 7.81%                     seasonally adjusted                 permits issued       permits issued total       one unit structure       includes multi family     permits issued   434     653  ...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
Market update at glance     Year  Percentage Increase      Yellowstone County   10/31/2011   2010 2011 or -Decrease                 Residential  Closed Sales Units   1460 1412   -3%                 Residential  Pending Sales Units   205 227   11%                 Residential  Active Property For Sale   963 835   -13%                 Average sales price Single family Home   $213,323 $206,162   -3%                 Average Square feet Single family Home   2356 2345   0%                 Median sales price Single family Home    $189,000 $181,750   -4%                 Median Square feet Single family Home    2220 2198   -1%                 Average Days on Market Till Offer Received         Single Family Home      63 70   11%                 Absorption rate -  TIME IN DAYS         Time it woul...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
seasonally adjusted             permits issued       permits issued total   one unit structure       includes multi family permits issued   417     594                 peak year   1798     2363   permits % drop from peak   77%     75% 50 year average   920     1400   permits % drop from 50 year   55%     58%               movement up from Bottom 353 18%   522 14%                 housing started       starts total     one unit structure       includes multi family starts   425     658                 peak year   1823     2494   starts % drop from peak   77%     74% 50 year average   1066     1495   starts % drop from 50 year   60%     56%               movement up from Bottom 360 18%   520 27%                               housing sales             one unit structure           new singl...
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By Wanda Thomas, Billings Montana Real Estate
(Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN)
This past summer during my gym exercise, I overheard many local teachers discussing their plans to pull up roots and move to Uruguay in South America.  Sounded like an interesting migration; cheaper cost of living, practically free health care (touted to be better than USA) and just a relief from the "nightmare in School District 2". Like many school systems around the country, the largest one in Montana, School District 2 in Billings, is facing budget troubles.  The leader of any school district, legislative district, State or Country can have a hard time keeping their job in a tough economy.  The local school board for District 2 experienced a huge increase in public comment and input during the last few months leading up to the forced departure of the superintendent.  People were gat...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
Market update at glance   Year  Percentage Increase  Yellowstone County   09/30/2011   2010 2011 or -Decrease                 Residential  Closed Sales Units   1329 1268   -5%                 Residential  Pending Sales Units   226 242   7%                 Residential  Active Property For Sale 1006 907   -10%                 Average sales price Single family Home $212,368 $207,214   -2%                 Average Square feet Single family Home 2350 2364   1%                 Median sales price Single family Home  $188,950 $182,900   -3%                 Median Square feet Single family Home  2214 2208   0%                 Average Days on Market Till Offer Received         Single Family Home      62 72   16%                 Absorption rate -  TIME IN DAYS         Time it would take for all ex...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
When making a major decision such as a buying a home many factors come into play. The first piece of information would be how long you plan to live in the home. In my opinion, your time frame should be a minimum of five years, unless there is some plan to convert the property to an investment property, which can change the parameters of the decisions. Below is the information for Yellowstone county to compare what has happened since 2007 mid-September to mid-September 2011. In reviewing the information from 2007 you can see why  my opinion is that five years should be your minimum time horizon. In looking at the debt pay down and essential a flat market you may just barely cover the cost to sell. Still factoring tax savings and the cost of renting your total costs of living in the home ...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
ONE THING TO REMEMBER ABOUT YELLOWSTONE COUNTY, ALTHOUGH MY OUTLOOK IS POSITIVE, WE ARE NEITHER AN ISLAND NOR A WALLED CITY. WHAT THAT BRING US IS THE PSYCHOLOGY OF THE NATIONAL INFLUENCES, ESPECIALLY WITH THE NET IMMIGRATION OF PERSONS FROM AROUND THE COUNTY (GIVING US POPULATION GROWTH) AND THE BAGGAGE THEY BRING FROM THE REAL ESTATE MARKET THEY HAVE LEFT.  UNFORTUNATELY FOR MY FRIENDS IN THE NEW CONSTRUCTION BUSINESS AROUND THE COUNTRY TWO MAJOR INFLUENCES THEY HAVE NO CONTROL ABOUT WILL CONTINUE TO WEIGH HEAVILY ON THEIR BUSINESS FOR THE NEXT SEVERAL YEARS . THE FIRST IS THE FORECLOSURE MARKET WHICH WEIGHS DOWN PRICING AND WILL CONTINUE TO DO SO NATIONALLY FOR THE NEXT COUPLE OF YEARS AND UNDERWRITING REQUIREMENTS WHICH PUT THE  BUILDER AND BUYER IN  A QUANDARY OF HOW TO BRIDGE THE ...
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By Wanda Thomas, Billings Montana Real Estate
(Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN)
I took this picture of a real bird (house)'s eye view of the Yellowstone River from a log home for sale just east of Billings Montana.  The road is named Bald Eagle Road and while we were viewing this log home listing, right on cue, a Bald Eagle flew right in front of us on it's way to fish in the Yellowstone. I think it's only fair to mention that this is not riverfront property, there is a railroad track down next to the river.  However, this view is really not to hard to take, lots of wildlife all day long.  Tonight you'll be able to see the Northern Lights on the horizon, looking in the very same direction. If you want more info on log homes for sale in our area, just email me here 2wandathomas@gmail.com.  
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By Wanda Thomas, Billings Montana Real Estate
(Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN)
The Yellowstone County Extension Service helps to organize a 3 day event for Sewing and Crafty people who love to see and learn new things. Quilting, Serging, Machine and Hand Embroidery, Jewelry Making and garment construction; all under one roof! You get to hang out with like minded people!  You get to try skills you already have and learn a few new ones! The cost is so affordable, I don't know how they do this, except for the great support of sponsors and teachers! You can click this link to take you to our Yellowstone County Website onto the Extension Service page for the full brochure and some pictures of the finished products from some of the classes.  You'll need some basic sewing supplies, and some classes feature projects that you can do right in the class, but you need to purc...
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By Howard Sumner, Your Real Estate Source, Your Results Solution!!
(Howard Sumner Consulting)
Employment is the key to housing and we, in Yellowstone County, are moving against the national tide of flat employment. Several things of note to highlight. #1 the percentage we are behind 2010 in closed transaction has been narrowing , a positive, #2 inventory is slightly below 2010 a positive, #3 employment in the Billings MSA is 2300 jobs higher than June of 2010, #4 although not great news for my friends in the home building business, single family permits year to date are off 30%, this give the market in resale’s a positive by reducing supply to increase absorption. So what does all mean for the balance of 2011, first it really starts to supply a floor to the housing market in Yellowstone county. Second in 2012 we should start to see the sales number of both of existing and new co...
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