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Archive for December, 2010

The Preserve, Lake Orion MI- Are Prices Rebounding?

the preserve lake orion miThe Preserve is a very nice neighborhood in southern Lake Orion with easy access to I-75. Some of the many amenities that make The Preserve desirable are city water and sewer, sidewalks, subdivision lake, club house with a swimming pool, tennis courts and play ground area. The sub is also surrounded by woods which added value to the perimeter lots when build jobs were sold; value that seems to have stuck to the homes even in the current housing market.

The home values in The Preserve were hit hard just like the rest of Lake Orion. Many of the homes sold new in 1996-1998 with prices ranging at that time throughout the $200’s with an occasional home selling in the low $300’s.

In 2005 home prices ranged from $287,000-$372,000 and in 2003 and 2004 a couple homes sold in the low $400’s. This year prices have ranged from $155,000-$285,000.

So now you may be asking yourself- “Where does the title of this blog post come from?”

After 2005 prices were on a downward trend all over Lake Orion and The Preserves was no different. Prices steadily declined every year after 2005….. Until 2010. It appears that in many neighborhoods prices are starting to stabilize and the same is holding true in The Preserve. In fact, due to the lack of foreclosures in The Preserve, home prices may actually be arching the other way.

First let’s compare 2008 and 2009 home sale prices.

In 2008 there were 4 sales in The Preserve ranging from $255,000-$275,000. All selling for pretty close to what they sold for new. None of the 4 sales in 2008 were bank owned or short sales.

Prices dropped hugely from 2008 and 2009 with 6 sales in 2009 ranging from $211,000-$260,000 with no bank owned sales and 1 short sale.

Now comes 2010. One of the differences in 2010 was there was 1 bank owned home and 2 short sales. The 3 distressed sales in 2010 were of course the 3 lowest priced sales ranging from $155,000-$211,000. Now let’s compare the non-distressed home sales between 2009 and 2010.

There were 5 non-distressed home sales in The Preserve in 2009
There were 7 non-distressed home sales in The Preserve in 2010

2009 sale prices ranged from $211,000-$260,000
2010 sale prices ranged from $215,000-$285,000

2009 price per square foot ranged from $89/sq. ft. to $110/sq. ft.
2010 price per square foot ranged from $91/sq. ft. to $108/sq. ft.

A little deeper look at prices show that in 2009 there was only 1 home that sold for more than $100/sq. ft. where as 5 houses broke the $100/sq. ft. price point in 2010. Even the 3 distressed sales in 2010 ranged from $82/sq. ft. to $96/sq. ft.

The price differences in the non distressed sales in 2010 seem to be the same as in the past- location within the sub a primary factor in sale price and walk out basement also adding to value.

As of December 24, 2010 there were no sales pending and one active listing with an asking price of $299,900. If you currently live in The Preserve you can only hope they get pretty close to that price.

Jackie Hawley
cell: (248)736-6407
Jackie@JackieHawley.com

The Preserve, Lake Orion MI

For Sellers

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Rolling Meadows, Lake Orion

Rolling Meadows, Lake Orion real estate sales are a bit strongerrolling meadows lake orion real estate this year than in 2009. In 2009 there were 16 closed sales in Rolling Meadows and 4 leases with sale prices ranging from $153,000-$247,000 and lease prices ranging from $1500-$1800/month.

In 2010 there have been 14 closed sales in Rolling Meadows as of Dec. 24 with sale prices ranging from $164,505-$237,000.

In 2010 there have been 5 foreclosure sales
In 2009 there was only 1 foreclosure sale

In 2010 there have been no short sale closings
In 2009 there were 2 short sale closings

In 2010 there were 4 closings under $200,000 and all were bank owned
In 2009 there were 5 closings under $200,000- 1 was bank owned, 1 was a short sale

In 2010 there were 6 sales of $220,000 or more
In 2009 there were 2 sales of $220,000 or more

If you take out the distressed sales in Rolling Meadows, Lake Orion the price per square foot in 2010 ranged from $79/square foot – $111/square foot.

In 2009 the price per square foot for non distressed sales in Rolling Meadows ranged from $78/square foot – $97/square foot.

In 2010 of the 9 non distressed sales in Rolling Meadows, Lake Orion

  • 3 sales so far closed for over $100/square foot 
  • only 3 non distressed sales closed for less than $90/square foot
  • 3 closed for over $90/square foot but under $100/square foot 

In 2009, of the 13 non distressed sales in Rolling Meadows 

  • none of them exceeded $100/square foot
  • only 5 sold for over $90/square foot
  • leaving 8 non distressed sales in Rolling Meadows selling for less than $90/square foot

There are currently 2 houses pending short sale approval so we won’t know the prices until the short sales are approved and the homes close.  And there are currently no homes for sale or lease in Rolling Meadows, Lake Orion.

If you are considering selling your home in Rolling Meadows please don’t hesitate to call me.

Jackie Hawley
cell: (248)736-6407
email: Jackie@JackieHawley.com

Rolling Meadows, Lake Orion

Lake Orion Homes for Sale 

For Sellers

Market Analysis

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Below is a blog post I wrote recently for my home buyer blog, but felt the topic was also important for home sellers in Oakland and Lapeer Counties. No matter how much a buyer wants your house, if they are getting a mortgage the house will need to appraise. So instead of just re-writing the blog from the seller perspective, I figured I’d save myself an hour or so and just re-post previously written work of art!

When buying a home in Oakland or Lapeer County Michigan a standard contingency is financing (the buyer obtaining a mortgage for the house). Normally, part of the financing process is an appraisal, and the cost of the appraisal is born by the purchaser.

  • So is this the purchaser’s appraisal?
  • And is the appraisal for the protection of the purchaser?

The answers are no and no.

If it really was the buyer’s appraisal, the buyer would get a say in who the appraiser is. Or at least the buyer’s loan officer would get a say.

Loans mortgage appraisalsThe appraisal is for the protection of the lender. The lender loans money to a purchaser, and that money is secured by the house and, rightfully, the lender wants to make sure the value is there.

Because of some of the asinine changes in the mortgage process over the past couple years, the loan officer is no longer able to hire, or even speak to, the appraiser. The lender (loan officer) contacts an appraisal management company who then assigns an appraiser. And like in anything in life, there are good and bad appraisers.

So you the consumer can interview and choose the best real estate agent to work with. Interview and choose the best loan officer to work with, choose the best home inspector, best insurance agent, best title company … But no say on who appraises the home you are trying to buy.

Appraisers themselves are finding themselves under scrutiny because some want to blame them for the housing mess we are currently in. And the result has been overly cautious appraisers. And many inconsistencies in appraisals.

I had a sale earlier this summer where 2 appraisals were ordered from the same appraisal management company, for the same property within a few weeks of each other. The contract price for the house was $380,000 and it was one of multiple offers. So the free market pretty much set a price of $380,000. One appraisal came in with a value of $300,000. The other appraisal came in at a value of $362,000. Both were local appraisers.

I had another sale where I was on the listing end (a short sale) and it was another property with multiple appraisals. Between the buyer and the lien holders there was a total of 5 appraisals. 5 appraisers came in with 5 different values.

horse racing first and last equalOne of the main problems I’m seeing on the appraisals is the appraisers aren’t giving value for quality. Everything is size and location with very few adjustments, and those adjustments are for things like walk out basement vs standard basement. Maybe a few thousand for a finished basement vs an unfinished basement. If the comparable sales are in the same sub you may see an adjustment for location within the sub.

What I’m not seeing is when the house isn’t in a subdivision is credit for a more desirable neighborhood. In the first example above, that house was on a lake in Independence Township with Clarkston schools. Part of that lake is in Waterford with Waterford schools. Homes in the Clarkston school district have always garnered a higher price than Waterford schools- but not according to the appraiser.

I’m also not seeing credit given for quality. Top of the line Anderson or Pella windows will get zero value. Wood interior doors as opposed to the typical builder’s grade plastic feeling doors will get zero value. Upgraded cabinets, counters, light and plumbing fixtures will get ZERO value.

Now take 2 houses in the same or similar neighborhoods, and house a has builder grade everything and house b had the same floor plan built but upgraded everything mentioned above– should both those houses sell for the same price?

From a buyer perspective you may be thinking “Great! I can get $50K mattress money extra downpayment if house doesn't appraiseworth of upgrades for free.” Maybe not. You may find the perfect house and are willing and able to pay for quality. You spend $300+ on a home inspection. You spend $300+ on an appraisal, and the appraiser comes in $30K lower than the agreed upon price. The seller does not have to come down on price. If  the seller won’t come down, and if you still want the house, you would need to come up with the extra $30,000. If you don’t have it, you won’t get the house. You may have to settle for mediocrity in order to get a mortgage. Or in the case of the lake house above, maybe a lesser school district.

By the criteria many appraisers now feel they need to use, with the value determined solely by size and location, that is the same as saying the first place horse in the Kentucky Derby has the same value as the last place horse in the Kentucky Derby- all the same age, about the same height and all the same class of horse.

When I represent a buyer, I will perform a market analysis on the house you want to offer on. I will give you my opinion of value and back that opinion with comparable sales. I will also give my opinion on what I think the appraised value will be, and if there’s a difference, you will need to prepare yourself to possibly lose the house you want or pony up the difference. And if you are a person who feels that quality has value, be prepared to come up with additional down payment.

Please don’t hesitate to contact me about buyer representation if you are considering purchasing a home in North Oakland or Lapeer County.

Jackie Hawley
cell: (248)736-6407
Jackie@JackieHawley.com

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There are many advantages to working at home. I treat this like a job which means I’m in front of the computer working by 9 am and work through the day. If it’s a day with no appointments I’m on the computer all day, cell phone and land line next to the computer. The time I save driving I can use to extend my work day (or not).

The photo below was taken on Dec. 14; it was a day I worked from home. We had several inches of snow over the weekend and the roads were icy. The heavy snow fall increased the bird activity in the front yard – My desk faces the front yard. On Dec. 14 the bird activity was a bit unique. 5 pheasant roosters and 1 pheasant hen wandered over from across the road and decided to join the juncos, blue jays, doves, cardinals, etc.

I saw 2 more roosters across the road- they joined their friends the next day. Now I have 7 roosters and 2 hens showing up in my front yard on a pretty regular basis. I’m not bragging or anything, but sometimes you just can’t beat the bennies of working from home!

pheasants in my front yard

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Round Tree Lake Orion Real Estate Sales

Round Tree is a 223 home sub in Orion Township with entrances off M-24 and Scripps Rd. Houses in Round Tree were built between 1993 and 2003 and range in size from 1828 square feet to 2767 square feet with most of the houses well over 2000 square feet.

round tree lake orion miRound Tree homes have city water and sewer, sidewalks, community park and abuts Bald Mountain Recreation Area to the east. Lake Orion High School with a swimming pool and tennis courts is across Scripps Road. Round Tree is conveniently located just minutes north of I-75; the exit 81 ramp exits (or enters) at M-24 a few miles south of Round Tree. That exit is also just one exit from Great Lakes Crossing. Orion Oaks County Park and the Bark Park are also within 5 minutes from Round Tree. About 5 minutes north is the public access to all sports Lake Orion.

Many of the homes that have sold this year have been bank owned homes; 6 of the 9 salesorion oaks bark park were foreclosures, 2 were short sales and 1 “regular” sale. Not very different from 2009 which also saw 9 sales- 5 foreclosures and 4 “regular” sales. The good news is that the sale prices this year are about on par with last year ranging from just over $150,000 to just under $200,000 with the foreclosures selling for the most part for sixty something per square foot and the privately owned homes selling for eighty something per square foot. Many of these homes sold for well over $200,000 new and a couple sold in the mid three hundreds.

In 2003 sale prices in Round Tree ranged from $225,000 to $349,900. At that time things like location in the sub, 4 bedroom versus 3 bedroom, 3 car garage versus 2 car garage were determining factors in pricing. Price per square foot ranged from $107/sq. ft. to $140/sq. ft. In 2009 and 2010 prices seem to be determined more by ownership- the banks heavily discounted their homes and private owners were able to get a bit more.

If you currently live in Round Tree and wish to move (or have to move) and don’t want to short sale your house, you might want to consider renting it out. With the amount of people in the Lake Orion area who have lost their homes, the rental market is strong, and if you are considering upgrading in this strong buyer’s market, renting your current home in Round Tree may be a viable option.

If you would like to purchase a home in Round Tree that you may not have been able to afford a few years ago, now is a good time to take advantage of the super low prices and low interest rates. Many of the houses currently selling for about $100K less than their previous sale price, but prices have seemed to bottom out. In 2008 there was only 1 sale below $200,000. In both 2009 and 2010 nothing sold above $200,000, and there seems to be really no difference in the prices in 2009 and 2010. Combine that with the fact that Lake Orion/Orion Township prices on average are on the rise (slightly), it truly feels like Round Tree has hit bottom.

Jackie Hawley
cell: (248)736-6407
email: Jackie@JackieHawley.com

Home buyer blog: http://SoutheastMichiganRealEstate.wordpress.com

Home seller blog: http://SellingRealEstateInSoutheastMichigan.wordpress.com

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Price Per Square Foot DOES Determine “Value”

If you are considering selling your house in North Oakland County or Lapeer County Michigan you can kiss those upgrades you added to your house over the years good bye! Had the house built and chose the $300 light fixtures over the $50 light fixtures? Went with a little better cupboard in the kitchen? You know- the ones that weather much better than the builders grade kitchen cabinets your neighbors went with. The ones that still look good 10 years later. And still aren’t dated.

Hope you had hardwood put in instead of liminate or carpet for your own enjoyment and didn’t consider re-sale one iota. I hope the ceramic and granite in the baths and kitchen made bathing and cooking that much more enjoyable. You know- the money you sank into those all so important rooms for both your own enjoyment, but mostly for resale. How much DID you spend on those upgrades? Probably enough for an extremely kick ass vacation.

Too bad those upgrades don’t mean diddly squat to your appraiser.

north oakland county mi real estate price per square foot counts more than condition

photo courtesy Shari Weinsheimer

north oakland county mi real estate price per square foot counts more than condition

photo courtesy Donna McNeely

 

 

 

 

 

 

 

VALUE IS IN SIZE ONLY

 Gone are the days when the consumer set value. I recently had 2 buyer offers accepted- both sets of buyers were extremely happy with the prices they were getting their respective houses for. And the appraisers for both those houses seemed to feel that size alone ruled.

House #1 was a multiple offer situation on Lake Oakland. We came to terms at $380,000 and according to the listing agent we were NOT the highest offer. Other incentives in the offer swayed the sellers our way. Then the appraisal came in $80K low. She put almost all her eggs in the above grade sq. footage of the house and didn’t take into consideration the neighborhood, school district, the upgrades, the premium lot, she used comps on “inferior” lakes…… But the one place she was consistent was in her price per square foot.

I have another sale going on currently. Buyer and seller came to an agreed upon price of $98,800. The appraisal came in at $85,000. The problem is the house is a tad under 1000 square feet. Most of the comparable sales are around 1300 square feet. I’ve been in many of these houses- and they don’t compare. Except for size. All are 2 bedroom homes with basements and garages. The house my client is buying is meticously maintained. A better quality kitchen to start with and even though the house is 25 years old, the kitchen still looks great. Hardwood floors, ceramic baths, newer carpet. The current owners seem to be the type who repair or replace at the first sign of a problem- not after the roof leaks or after the deck boards rot and break.

The only adjustments made in the appraisal were for the basics like walk-out basement verses standard basement, 1 car garage versus 2 car garage. No adjustments for location, maintenance or overall quality.

So the long and the short of it is- All those upgrades your house has that your neighbor’s house doesn’t is not going to put one extra dime in your pocket. What it will do is make your house easier to sell.

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