Here are a few recent real estate stories I found interesting and will be watching. The mortgage interest deduction that we mortgag-paying home owners have come to take for granted may be in jeopardy. Are pending sales numbers an indicator of a market upturn? Downtown condos at a discount? How are Memphis home sales going?
Mortgage Interest Deduction
The government cost cutters are looking at ending the mortgage interest tax deduction. My accountant, who seems to have some insight into the proposal, thinks that any tax implications for the deduction will be on a sliding scale, based on income. How will losing this subsidy for home ownership impact future sales and current homeowners’ tax bills? I guess we will see. Here’s the NAR’s take on the situation.
Pending Sales Report
Once again the NAR pundits are touting pending sales as an indicator and predictor of a market upturn. I disagree with this approach. The way pending sales are reported varies from locality to locality and even agent to agent. Does an executed contract constitute a pending sale? Or contingencies like inspections, repairs, and financing have to be removed first? How many pending listings actually get to closing? Questions the pundits need to answer. They should not be using pendings for any analysis unless the term is defined. And if you mark a short sale as pending early on, it could stay pending for months, then not close.
Memphis Condo Auction brings Deep Discounts
Eleven units at the Harbor Lights Condos, 426 N. Front St., were auctioned last Thursday and some pretty good deals were made. Many of the units went for less than 50% of recent asking prices. I didn’t get much info on the motivations of the buyers or is speculation on the success of Bass Pro was involved. The building sits across the street from the Pyramid. Development Consultant Tony Bologna mentioned in the Commercial Appeal article that there is nearly a 3-1/2 -year supply of completed and available condos Downtown, based on recent stats.
If you have thought about a condo purchase in Downtown Memphis, this is a great time to have a look at the inventory. There is financing available in many of the buildings, and owners are eager to negotiate. Contact me for a list. I remain bullish on Downtown. Those who wait may be kicking themselves a couple of years from now.
October Home Sales
October showed another drop in number of transactions and a very slight drop in median home prices, as reported by the Memphis Area Association of Realtors® (download report).
The Daily News has a pretty insightful article on the meaning of the market numbers. Hopefully, we are nearing the end of the after-bubble-burst price corrections. As I always say, we won’t be able to define the bottom of the market until we have passed it. Buyers: there is just not going to be a more perfect storm for home buying. Interest rates remain very low. Inventory is good, and sellers (including the banks) are ready to look at offers.
In Conclusion
I am feeling more positive about a real upturn in the real estate market in the near feature. From the greatest inflation of the housing bubble through the fallout of the bust, I have tried to tell the truth about what’s going on and avoid the industry hype that has often painted a distorted picture of real life. Homeowners are definitely taking paper losses from their value positions a few years ago. Home sellers feel a financial crunch, especially if they bought during be bubble years. Buyers with good credit are in the driver’s seat. Please contact me if you have questions about the market in general, specific home values, recent sales history in your neighborhood, or if you are interested in finding out if you are really ready to buy a home.
Related articles
- It’s time we come to grips with the Memphis Real Estate Market (memphisrealestatebuzz.com)
- Bargain-hunters score in auction of Downtown Memphis condos (commercialappeal.com)
- Thank You, Essential Workers - September 7, 2020
- Mid-Century Modern for sale – 346 Waring, Memphis, TN - July 9, 2013
- RE Buzz – Real Estate News Roundup – July 9, 2013 - July 9, 2013
What do you think? Leave your comments.