Cleveland, Northeast OH Area Real Estate Market September 2013

According to the Northeast Ohio Regional Multiple Listing Service (NORMLS) and an article from the Cleveland Plain Dealer newspaper, homes sales in the region dropped from August to September, but continue to surpass last year's sales figures. Lower home inventory, higher rental prices and higher buyer demand due to low (but climbing) interest rates, has driving this increase in activity and increase in sales prices over the past year.  Economist say that the recent government shutdown and consumer uncertainty attributed to the reduced sales volume in September.
Sales comparing September 2012 to September 2013 still show increasing sales figures.  Among the 15 counties in Northeast Ohio, single family home sales are up 15.2% and 3.1% for condominium sales. 



By comparison, Northeast Ohio is showing a 3% price increase from last year, with the state of Ohio's at 2%. Ohio's sales volume increase was also up by over 18.9% from September 2012.  The US market saw a 11.7% increase in sales price from the year before, and is showing a sales volume increase of 10.7%.  Ohio and Northeast Ohio's price increases have stabilized recently, while the US sales prices continue to rise at a higher rate, which has been historically the case in the area compared with the nation.  There is concern that home prices are rising faster than income growth.



The key point here is that the market is starting to stabilize and shifting to a seller's market.  Sellers are getting more for their homes than last year, with buyers paying a bit more to purchase a home to take advantage of the low interest rates.  Buyers should note that interest rates have decreased slightly, hovering around 4.3%. 

This is a great time for buyers who also have a home to sell, because rates are still relatively low on the buying side, but home values have risen in many areas to improve the financial return on the selling side.  If the economy continues to improve, buyers in the current market will be able to realize value gains for the homes they purchase as well.

New Home Construction - Reasons To Have Realtor Representation

Buying a new home is exciting, and home construction is on the rise. You get to build your home the way you want it to be. But like any home purchase, new construction is an expensive transaction with many financial implications.

Here's why it’s a good idea to obtain representation from a Realtor when considering new construction:

Sales Reps Work For The Builder. Builders usually have their own agents or representatives on site to discuss the home construction process, and help with a potential purchase. They can explain how the builder compares to competitors, differences between models and floor plans, go over your financing options, upgrades and specials, etc. But it’s important to know that builder reps represent the builder.

Fiduciary Duties. When you use Realtor representation, their responsibility is to you. You have a local expert who is looking out for your best interests, who’s contractually obligated to protect you. A buyer's agent can help you navigate the contract and help you understand the specific clauses, riders and upgrade, making sure you know what you need to before you sign on the dotted line.

Negotiating. Finding the right model and choosing your upgrades is fun, and you should truly try to enjoy the experience. The contracts and negotiating terms and options is the not-so-fun part, and can be quite daunting.  Most buyers don't know they can even negotiate with a builder. Your agent can also present other financing options or possibly work with the builder’s lender directly to get you a better rate for your mortgage.

Navigating You to Closing. Signing a contract with a builder is step one in the process. You must also line up financing, work with title companies, attend numerous inspections and make sure completion of the home meets the deadline. Your Realtor can manage that process to ensure you’re not missing anything at each stage of your new home's construction.

Home Value Accuracy - Agent Versus Software Estimates

If you're considering buying or selling a home, I'm sure you've probably looked at various real estate sites to see how much homes are valued for.  As a real estate professional, I get clients that ask me about these home value estimates all the time.  Some of them have almost decided not to buy or sell a home, because they trusted these estimated to be accurate, and they got the impression they could not meet their selling or purchasing goals.

So, I decided to due my homework and see just how accurate these estimates are.  I went to the most well known site for home value estimates...Zillow.  Their "Zestimates," as they're called, provide home value estimates of any home, whether they're for sale or not.  Zillow states that this is not to be construed as an appraisal, but an opinion of value.

The issue is, these values are derived from county tax values, last sales price, surrounding homes in different communities and school districts.  It may also use homes that while close in proximity, are of varying quality, size, condition, age, and/or distressed (foreclosure or short sale).  The homes could be in a better or worse location as well (train tracks, near highway, on a main road, etc).

I attached a screen shot from Zillow's website that discloses the accuracy of their "Zestimates," which can be viewed at the following link as well.  ZESTIMATE ACCURACY



Being a Realtor in the Cleveland and Northeast Ohio area, I'll ask you to draw your attention to the Cleveland OH statistics. As you can see, the "Zestimates" are only 35.9% accurate within 5% of the true value, 63.7% within 10% of true value and 83.7% accurate within 20% of true value.  If an agent had accuracy numbers like these, he/she wouldn't be a very successful Realtor.

To put this in perspective, if a seller owned a $250,000 home, the differences at these 5-20% levels of accuracy could range from $12,500-$50,000!  If the seller's home is one of the 16.3% that weren't even accurate within 20%, this number could be even higher.

The point is, as I explain to all of my clients, using the internet to obtain real estate knowledge can be a great thing, but can also be misleading or incorrect.  Knowing the source of your information is very important, and it's the reason I wrote this article.  Specific to this topic, nothing replaces the valuation of a local real estate agent.  And when choosing a Realtor, be sure to interview more than one to make sure you're choosing a knowledgeable agent that will successfully guide you through your transaction.

Ohio Career Expo at the Cleveland Public Auditorium

Screencap taken from https://www.facebook.com/ohiocareerexpo

For those who are looking for a new job or considering switching careers, the Ohio Career Expo will take place on Tuesday, October 8 at 10am at the Cleveland Public Auditorium, located at 500 Lakeside Avenue E in Cleveland.

The Expo is an excellent opportunity for job seekers to apply at several different companies. For those looking to hire, it’s a good way to meet with hundreds of qualified candidates and possibly make several hires in just a few hours.

Registration is free of charge, but required, as tickets are going fast. Over 100 top Northern Ohio companies looking to hire will be in attendance, with full-time and part-time jobs available in industries including (but not limited to) advertising, aeronautics, agriculture and fishing, automotive, construction, education, engineering, food services, healthcare, hospitality, insurance, manufacturing, marketing, real estate, retail, sales, security, technology, telecommunications, and transportation.

According to the event’s official Facebook page, there are over 1,200 job openings in the Cleveland area healthcare sector alone. So don’t miss out on this fantastic opportunity, register now. For more information, please visit https://www.facebook.com/ohiocareerexpo.