The Brad Weisman Show

The Homebuyer's Guide to Mastering the Market Maze

February 08, 2024 Brad Weisman, Realtor
The Brad Weisman Show
The Homebuyer's Guide to Mastering the Market Maze
Show Notes Transcript Chapter Markers

Join Pete Heim and Me, as we dissect the market's complexities and offer a roadmap for what's to come.  Imagine a world where the seller's market reigns supreme for another half-decade—this isn't a crystal ball prediction but a careful analysis of trends and data. We strip away the panic-inducing headlines about foreclosures and provide a realistic comparison to previous years, ensuring you're equipped with the facts, not fear.  We analyze the inventory flux and the speed at which properties are changing hands, giving you an insider's view of this fast-paced market.

Step into the home-buyer's shoes with insights that could make all the difference in securing your dream property.  Quality photos are the unsung heroes of real estate listings, and we'll tell you why skimping on them could cost you a sale at the best possible price.  Interest rates are on a rollercoaster ride, and we'll discuss their impact on your wallet, coupled with strategies for keeping mortgage pre-approvals fresh. 

Plus, we'll explore how gradual home price increases and wage trends could influence your home-buying power. Join us for a session that promises to arm you with knowledge and foresight in this ever-evolving real estate journey.

#peteheim #bradweisman #thebradweismanshow #realestatemarket2024 #homesales

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Welcome to The Brad Weisman Show (formerly known as Real Estate and YOU), where we dive into the world of real estate, real life, and everything in between with your host, Brad Weisman! 🎙️ Join us for candid conversations, laughter, and a fresh take on the real world. Get ready to explore the ups and downs of life with a side of humor. From property to personality, we've got it all covered. Tune in, laugh along, and let's get real! 🏡🌟 #TheBradWeismanShow #RealEstateRealLife #realestateandyou

Credits - The music for my podcast was written and performed by Jeff Miller.

Speaker 1:

Inventory we do not see becoming any better.

Speaker 2:

No.

Speaker 1:

And I think we're going to be in a seller's market for at least five to ten years. I agree, I'm going to predict out five to ten years.

Speaker 2:

I think five is probably a minimum.

Speaker 1:

Five is a minimum. Something's got to happen. From real estate to real life and everything in between the Brad Wiseman Show and now your host, brad Wiseman. All right, there we go. Another show. This is great. This is actually a show I looked forward to every single month, because my good friend Pete Heim is here in the studio. God, if you could hear what we talk about before we go in the air, right, hugo? It would probably be pretty bad, pretty bad.

Speaker 2:

No, it's all good stuff. Like Hugo said, it'd be a lot of views when you get three guys in a studio.

Speaker 1:

it always goes to, it just goes bad, it just goes bad.

Speaker 2:

Three guys in a? Yeah, it's like a start of a bad joke. Yeah, exactly Three guys in a studio. Yeah, that's right.

Speaker 1:

So true, so no, I'm always glad because it makes us really kind of take a look at what's going on in the real estate market. You know, we do real estate every day. We're doing a lot of other stuff on the show now besides real estate. But I look forward to this because this is my life, this is my career, so it's always good to talk about real estate. So what do you want to dive into first?

Speaker 2:

Well, you know what Part of the show is like taking our step back from our day to day, because, as realtors, we're just in it, right.

Speaker 1:

Absolutely.

Speaker 2:

But sometimes it's hard to take the time to just step back and say, hey, what's really going on in this thing. So true. So it forces us to do that every month, which I love.

Speaker 1:

And it's good. It makes it so we can talk educated when we're with our clients, edumacated. Yes, so there's a lot of different things going on. I mean it's a lot of the same, but there's things that we're seeing that are changing. So you want to dive into the whole foreclosure number first.

Speaker 2:

Yeah, we can, but this is more about you were asking to delve a little deeper this time, which I'm glad we're doing, yeah, yeah, so let's talk about foreclosures.

Speaker 1:

The headlines are oh, the way up, the way up, well the graphic you'll see what news you listen to, that they, they sound like they do.

Speaker 2:

All those, all those you know different, different ones.

Speaker 1:

Yeah, you know, grandstanding kind of sounds like CNN to me. Yeah, like CNN. Yeah, oh sky's falling yeah.

Speaker 2:

But so, but so. I mean the foreclosure numbers are up from 2022. From 324,000 to 357. Okay, folks, and over it's. I mean in 2008, nine, 10, we were in the two, we were almost 3 million foreclosures in 10. That's amazing, right.

Speaker 1:

Yeah, it's incredible.

Speaker 2:

So that's yeah, that's like a little. That's not even that's 10, just a little over 10%.

Speaker 1:

It's not bad at all. You look at anywhere from, if you look from even 2012, when the market started to change, and all the way up until 2019, I mean the lowest from there was 493,000. That was in 2019. 19. So you know we're still well within. You know where we should be.

Speaker 2:

So that's that's, it's a non-event. Well, the pandemic 2020 and 2021 was the four bands program.

Speaker 1:

Yeah, yeah. So nobody could, nobody could, and there was still 151,000. Right? Who are those idiots? How in the hell did that happen? Right? How did they foreclose if they weren't allowed to? No, how did that happen? I don't know, governor, yeah, could have been.

Speaker 2:

I don't know, but this is national, this was the. This is national, yeah, so it's a non-event. So if you guys see that the point is, throw it next to Hugo over there.

Speaker 1:

Yeah, I'm done with that one. I'll throw your phone, yeah. So what else do you?

Speaker 2:

got. But if you see the, the news line, the headline, it's not, it's not bad guys, we, we could actually use more of that, to be honest.

Speaker 1:

Absolutely yeah, we get listings.

Speaker 2:

Yeah, so how'd you look at this morning? Three uh just looked at 335.

Speaker 1:

Right, which is, which is actually better than it was over the weekend, better than it was Monday. Here we, you know we're here, we are on a Thursday, right, it's better than that, so that's good.

Speaker 2:

We're heading in the right direction.

Speaker 1:

We are. It was getting close to being under 300 again and that was really scary. Right it was, that was scary.

Speaker 2:

With 30 something. Yeah, I know, but we're 301 active, but 30, like we said, the break it apart Coming soon. Status guys, is it's an active status that we're not showing? They're not having showings yet, but it's still in the market, right, but out of that 335, 31 of them are coming soon, which means they're on the way. Yeah Right, absolutely yeah. So that's good, but the pending number, which was what was cool, oh yeah.

Speaker 1:

The pending number.

Speaker 2:

There's 346 pendants on the market right now in Berks County, which is over the amount of active that are on the market. Yeah.

Speaker 1:

That's that's that's not, that's telling. That's the problem. Yeah, because as they come on, they go off. As they come on, they go off. That's what's going on. That was, but that was a good.

Speaker 2:

I'm glad you said that, because that's we never really look at pennies as as much as we should, and that's a really good indicator.

Speaker 1:

Well, and also the thing about the pendants is well, it's not only that, it's the showings. We you know how many showings are there. So, because that tells us how many buyers are still looking for a certain home or a certain price range. What a segue that was. Yeah, I think you have some of that information, right? I think he does. He's prepared. No, but that's seriously think about, because here's the way I look at it, hugo, when, when you were looking at houses, we were up, we were when we would do a showing, it was like you know 30, some showings or whatever it was, and then you know 12 offers and then whatever. So you know, if that, if that number is still at those 38 showings, that means there's 38 people that are in the market to to find a house like that. So that's a number that we need to know or that would be good to know Exactly.

Speaker 2:

But in the bright system, in the bright system which is our MLS, which is our MLS system, I mean in the competitive market activity the last 28 days. It breaks down all these numbers as new listings, active pending's, closed and all that stuff right, but the competitive summary is average appointments before contract.

Speaker 1:

Right, that's how many. That's how many showings are appointments before contracts? So?

Speaker 2:

how many? How many showings are there are average? How many appointments are there before it goes to contract you ready? Yeah, this is way lower than I thought it would be 2.63.

Speaker 1:

Sina that's interesting. That's a lot lower than it used to be.

Speaker 2:

I can't believe it. And the average portal favorites out of that was 3.65. So it got three points. That particular listing got 3.65 on average Right Favorites.

Speaker 1:

Now, these are all averages. This is not Average, so this makes sense.

Speaker 2:

Yes, because sometimes that's 0.1. Exactly, or 10.

Speaker 1:

Well, that's what I'm saying. If you had 30, some showings on one listing and then you had two on another, exactly, that really averages out, yeah.

Speaker 2:

Right, gotcha, and then you have the average appointments per listing. So far in I mean listing appointments in January. This was listing showings 777 in our region and our might write 777 showing showings.

Speaker 1:

Wow, that's how many showings there were.

Speaker 2:

That's amazing.

Speaker 1:

That's an interesting stat it is. It's a lot of showings, I think that's what we're going to follow.

Speaker 2:

Yeah, I think that's. It really shows you what the activity is. Well, that shows activity.

Speaker 1:

That shows activity Because that's a number, because if you, if that number goes up, yeah, and the amount of listing stays the same, right, that means that we have a lot of buyers that aren't getting houses Right, right, right.

Speaker 2:

That's amazing, it's a good one, we're gonna watch. We're gonna watch that number, yeah, yep. And then the average. This is a good one, guys. This is the one that we follow anyway. But this is I'm gonna bring it up because this actual report gives it the listing average closed to original price and it broke it down per week and and for pretty much from October until today, it's 99.68% of listing. Wow, and this is that's, that's over the last three months. Yeah, okay, so 98.6. Yep, I mean, there was one time it was up one point and there was a hundred. It was over a hundred point five, nine.

Speaker 1:

Yeah, so people are getting what they're asking right, much right, but it means also, maybe stuff's not going 20,000 over the full price, exactly, yeah, exactly.

Speaker 2:

One thing that has changed a little bit.

Speaker 1:

It has. I think that's where we've hit a little bit of a ceiling, which is good, because you can't keep going 10% a year. If I'm sure we've had a little bit of a ceiling, I believe where, yes, the houses, and this is what I've been reading recently pretty much everywhere Inventory, which we just talked about, inventory we do not see becoming any better. No and I think we're gonna be in a sellers market for at least five to ten years. I'm gonna predict out.

Speaker 2:

I think five is a probably a minimum five is a minimum. Some something major has to happen here in Berks County to order for those, those numbers to come back up again.

Speaker 1:

Absolutely, because if we're not, there's no way afford to come up unless we start building. Even if a builder started today and wanted to start building houses in a, in a you know a farm land or something like that somewhere You're looking at for three to four years until you're actually putting a shovel in the ground, in the houses because of regulation. So even if we realize the issue today which we do realize, and I know the chamber is working on it, I know the county's looking at different things we have a housing shortage show. It's gonna take four to five years. So now that's, if we start right now, right, and if we don't, it's going to keep pushing that out further and further. So anybody that thinks at this point that there's going to be time period over the next two to three years where prices are going to come down and you're going to get this bargain deal, I have to tell you, if I was a betting person which I'm not so much if I was a betting person I would put a lot of money on that. That's not going to happen.

Speaker 2:

Yeah, I would.

Speaker 1:

So you know, and if you look at most of the stats out there, they're pretty much saying that too. What I disagree with is that a lot of the national stats are saying that prices are going to recede a little bit. I don't believe so.

Speaker 2:

I don't think so. Not here, especially Not here. There's something new interesting coming, because I get the co-star new stuff every day. Yeah, A lot of these office complexes are trying to convert. They're trying to convert to either apartments or condos I've heard that and they're running into regulation problems red tape, and this is I'm going to talk in Chicago and some other metropolitan areas.

Speaker 1:

Bigger cities.

Speaker 2:

Yeah, because there's a glut of office space right now. Yeah.

Speaker 1:

New.

Speaker 2:

York City, new York City yeah, we can go on and on, but I think it would be good if they would be able to ease some of these regulations, the condo, some of these places, because that would help our inventory problem Absolutely Right. Berkshire Mall, berkshire.

Speaker 1:

Mall. Oh my God. I mean you know not to pick on the Berkshire Mall, but jeez, you guys have any homes we could put in there, man or not homes, but apartments condos yeah. And see what that does. Is that frees up inventory? Yeah, because now you know, and you know before we talked about this, oh my God, two years ago we started really digging into this inventory issue. I don't care if it's apartments, condos, townhouses, I don't care if it's tents, if there's somewhere that people can live, that you know that we can free up some of this demand. I want the food court.

Speaker 2:

You want the food court, the food court's cool.

Speaker 1:

There's not much up there anymore, though, I know, but it'd be a great condo. It'll be a great condo. Yeah, absolutely yeah.

Speaker 2:

You guys know about the food court out there. I mean, go check out your own escalators going up and down stuff. Yeah, I want it, yeah.

Speaker 1:

Go for it. We'll put a word in for you, thank you. Thank you very much. You go work on that, that's right.

Speaker 2:

Yeah, Another interesting thing here on this same vein is portal activity, and it gave you this full listing views 43.3.

Speaker 1:

What does that mean? That means people going into when they're working with a buyer agent. They can go in and they can actually look at the look on their portal that the agent entered for them for their search.

Speaker 2:

This is average per listing. Full listing views is 43. Buy your favorites is 3.65 on an average listing. Got you? That's what this is. Buy your possibilities 1.78, which I'm not 100% sure what that means. But 3.54, the buyer discards. So those they just didn't fit the bill. Yeah Right, no.

Speaker 1:

I'm sorry. This is why pictures are so important for your listing.

Speaker 2:

There is a possibility button on that.

Speaker 1:

Yes, there is, absolutely. That's what that is. Yeah, it's the possibility button.

Speaker 2:

It's like a maybe. It's a maybe, yeah.

Speaker 1:

Yeah, that's what it is. Sorry, but seriously, when you look at that and you think about the ones that said no, that shows you that people are disqualifying their home the home by looking at it online. Boom, they didn't even want to see it, Right, so they came up in their search. Yeah, but they said no to it because the pitch, because it didn't meet their needs while looking at it.

Speaker 2:

So this is why, when I look at it right, Look at it anyway.

Speaker 1:

That's why sellers or agents, make sure you take professional photos.

Speaker 2:

Oh yeah.

Speaker 1:

Make sure that you're given that house the best possible chance of being shown.

Speaker 2:

I saw one the other day, man, it was on the guy's iPhone or something. It was horrible. Yeah, it's terrible. I don't know who you are, I'm not sure which one it is Please don't do that. Just stop, just do professional photographs.

Speaker 1:

That's right.

Speaker 2:

Because, unless you want your seller to not have you know 3.54 fire discards.

Speaker 1:

And that's what happened. That's exactly what happened.

Speaker 2:

Yeah, sorry, I'm off my horse.

Speaker 1:

That's right. Yeah, Good, Anything else? Well, here's the other thing. There was affordability, which I thought was. You know, it's not the worst. The affordability is still. It's not the worst, it's ever been right.

Speaker 2:

It's still more affordable because interest rates are declining Right Right. That's the biggest one here.

Speaker 1:

Probably Do you think people know that the rates went up to 8.5 and now they're around 6.75?.

Speaker 2:

No, I don't know?

Speaker 1:

Do you think the average public? What do you think, hugo? Does the average public know that that rates?

Speaker 2:

went up and came back down. No, I didn't know. Unless you were looking to refinance, then you keep your eye on it, yeah, yeah, well, what's funny is he had a good realtor, though, looking for it he's like he didn't even know.

Speaker 1:

He's in a real estate podcast. Is he listening to music?

Speaker 2:

He's like over there jamming. He has headphones all the time, but you knew because of right refinancing.

Speaker 1:

You're watching it because you have a purpose. You have a purpose. So the normal, the average public doesn't know.

Speaker 2:

But if you're looking for houses, it's lower than that. Right now I saw 6.375. Wonderful, okay, that's the new norm. I mean, you're right, brad, it got up to 8. Some areas it was even over 8.

Speaker 1:

It was over 8 here. As far as numbers, I saw was 8.25. 8.125.

Speaker 2:

Right, but that plays a big part in affordability oh my gosh, yes, and the fact that home prices are expected to rise at a slower pace. We did 7.38 last year in Berks County. All the experts are saying, actually, what was that? Two something? I think that last time we did that MBA has their way, it's 4.1. But other than that, I think it's going to be two.

Speaker 1:

Yes, and that's pretty much what. The average was 2.1.

Speaker 2:

And buyers that's great news for you. Sellers, that's great news for you You're not losing. Yeah, it's getting slower.

Speaker 1:

It's going to take longer. You've got to have patience. Keep your pre-approval updated at all times, because the last thing you want to do is on a Sunday afternoon. You found the one and now, all of a sudden, you're shuffling for a pre-approval on 5 o'clock on a Sunday. Good luck, unless you have a really good lender, which we do in this area. So that's the thing you have to keep in mind.

Speaker 2:

And if you need updated tax returns, it's that time of year now.

Speaker 1:

So if you want to, include your 2023,.

Speaker 2:

Get it done now. Do it right away? Yeah, absolutely. And the biggest thing was that wage increase yeah, way faster. I was surprised to see that Way Me too, I couldn't believe it. Now, this is national Right.

Speaker 1:

But what if that's just all the UPS drivers from that contract? They got the union contract that they got. They got a raise but did you see the laying off 12,000? Which stinks, but yeah, isn't that funny.

Speaker 2:

Look at that, raise yeah it went up a lot. Above that white line, did you get a raise? Hell, no, you go, did you?

Speaker 1:

get one, did you?

Speaker 2:

No, we got to talk about it. Let's talk to the owners. Actually, brad, can we have a conversation? No we can't.

Speaker 1:

You brought it up, so that's good. So here's the good point is, if these numbers are factual which we hope they are if your pay is going up and the price and let's just say your pay goes up by 5% or 4%. What's cost living? 3% or something like that. If your pay is going up which it looks like it outpaced the normal, it outpaced it and the prices of houses go up 2%, you're ahead of the game. You're ahead of the game, you're okay. And then also if the rates are at 6.5%. That's the average now. That's where the new norm is Rates aren't going back down to 4%. They're not going back to 5%. I don't think either. So get used to the 6%.

Speaker 2:

So everyone remembers the percentage of your monthly income that the bank uses to qualify you. That's why when it goes up, it's better for you. I mean, the last time I checked, people were only using about 15% of their gross monthly income for housing, which is really good. Banks allow 28 or 30 or so. So I mean now it's even better with your wages going up. It's a huge factor in your affordability. So what you're doing is you're overcoming any house price increase, possibly an interest rate increase. It's almost status quo if you're serious. So it's good.

Speaker 1:

Yeah, two things. Well, there's two things here. One is, like I always say, the only market we know is the one we have right now. That's right. So, trying to predict what's going on in the future, what's going to happen in the future If you're buying your personal residency, don't play around with that. If you need to buy or you want to buy, buy now Because, like I said, the only market we know is the one we have right now. The other thing was real quick is the graph that I have here from keeping current matters, which was interesting. Top three reasons buyers paused decision to buy a home. Oh, I saw this is good. Yeah, 17.4% was affordability, which is interesting, very low. That's not what I thought. Okay, inventory, which we all know, is 34.4% still not the major reason. Really, the major reason was mortgage rates. 72.1% of buyers said they're not going to do it right now because of the mortgage rates. Wow, yeah, pretty interesting. Right, that's interesting. So that's what we're trying to say. Don't let that be used.

Speaker 2:

Don't let that be no cause, really. I mean, brad, you well, you and I have been around the block. We remember double digit interest rates, but most people don't. But what we always say, you know by the perfect house, you can always refinance it later, man.

Speaker 1:

Yeah, absolutely.

Speaker 2:

You can always do it and the rates coming down is a good chance you're going to. You're going to be in a good spot.

Speaker 1:

Absolutely, and I think, I think those are good numbers, good things for us all to go over and thanks for bringing all that information.

Speaker 2:

I appreciate it.

Speaker 1:

So so what do you see you starting to pick up? You've seen listings coming up.

Speaker 2:

Yeah, 28 with this, actives this morning. Yeah, it's coming, it's coming, guys. That's really good.

Speaker 1:

Hugo, you got anything. You're good. Thank you for your knowledge. Yes, thank you for your humor.

Speaker 2:

Very welcome.

Speaker 1:

What would we do without you, guys?

Speaker 2:

Nothing, oh my God, nothing. We're sitting here looking, you're right.

Speaker 1:

We wouldn't do anything. We wouldn't even show up. It's unbelievable. All right, there you have it. Pete was back in the studio here, almost at office I'm so used to staying office, but yeah, that was great, great information. Please come back. Once a month. We have Pete here. It's some great information You're not going to hear anywhere else. This is the local information, and also national information too, so if you're listening from somewhere else, you'll probably get something out of it. Yeah, thanks for listening to the show. We're here every Thursday 7pm. Facebook, instagram, youtube, anywhere you want to find a Spotify, apple podcast, all that stuff. All right, that's about it. Thanks for your support. All right, we'll see you later.

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