Blog :: 06-2009

Great News. New Market Update.

Great news since my last post: the market is picking up. I had 16 for dinner last weekend and several friends and clients asked where my new blogs were. The truth is that I work about 12-7, and its hard to find the time! (I'm typing this at 10:00pm). But I know you need a market update for this quarter, so here it goes...

The market is finally showing some signs of life. Many deals are in the works. Here are some highlights of what is selling in the last few months:

Washington:

Half of the Potter Farm has sold again. It will be interesting to see what the selling price for this was, as it was purchased by an investor at the top of the market. I'll let you know when it closes. Offered $3,495,000.

My listing on South Fenn Hill is under agreement,offered $2.3mil. This house got more showings than any other listing I have ever had. I'm not surprised it is one of the first things to sell as the market picks up.

The tear down on Calhoun St (except it can't be torn down because its in the historic district) is under agreement after being lowered from $2mil to $1,250,000. Again hard to draw a conclusion on price as the original offering price was so unrealistic in any market. Its going to give jobs toarchitects, builders, and decoratorssomewhere for many years to come. I thank the buyer for helping the employment situation.

A tear down house on lake Waramaug which came on for $995,000 sold immediately with multiple offers. Again, builders, get in line and get the wrecking ball ready (neighbors get out your ear plugs)...

Warren:

The large house offered on Curtis rd (owned by the retired CEO of a major financial company) which started at $12,000,000 several years ago and was lowered to $7,350,000 recently, is under agreement. Hard to make a judgment on price decline here though, as it should never have been offered that high.

Roxbury:

The stone house (owned by a NY real estate grand dame) on rte 67 which has been on the market for many years has sold. Offered $3,750,000

Somebody is getting a great deal on Rucum Rd (offered $895,000) which just went under agreement. A lot of value in that property.

My listing on Tophet Rd is under agreement. Offered $1,375,000.

Bridgewater:

A house on the Lake is under agreement offered at $2.5mil.

Kent:

A fantastic contemporary farmhouse sold for $1,310,000. It was originally offered at $1,800,000. So thats down about 27%. Seems about right to me....

Litchfield:

113 South St which was originally offered at $2,395,000 a couple years ago came back on at $1,495,000.It sold with in a few weeks. This is a really nice house and I think was a great deal for the buyer. This proves the point that if you price your house realistically, buyers are out there looking and they will respond. However, it is certainly bad news for owners in that area, as it will set a comp that neighbors will not be happy with for years to come...

For the first time in recent memory, I am actually working with a handful of buyers who are saying "we want to buy now" and are coming up regularly to look (smetimes every single weekend religiously). The overall attitude is beginning to change.

However, I must caution, that although buyers are interested, they are price conscious and will not overpay. We have a lot of inventory. Buyers have many options for the time being....

Happy Summer.

Rooster Tail Inn Open to the Public

I was so happy to have sold the run down antique house in the center of Warren a couple of years ago to buyers who had big plans. Little did I know how big their plans would be! I expected a little sanding and painting, some lighting and decorating. I thought any improvement would be great for the town of Warren, and our entire area. However, The Rooster Tail Inn has surpassed everyone's expectations. Luckily for our area, the town "saw the light" and gave the Inn the ability to open to the public. Clients took me there for dinner last Friday, and we were quite pleasantly surprised. The food was simple but fantastic, and the service was impeccable. We had filet mignon sandwiches, crab cakes with corn salsa, brie puffs, and cheddar sliders. The restaurant and bar were full (Dorothy Hamill was at the bar!)I used to be a skater and had a "hamil camel" in my day. Although it was raining our first visit, we look forward to going back and sitting outside on the terrace as soon as possible.

We are thrilled to have this new dinning venue in our area, be sure to stop by and check it out. All the info about the Inn is on my site under accomodations.

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Note From Local Mortgage Broker

William Arthur Ward said The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.

Here at Hourglass, we are constantly adjusting our sails to adjust to market realities. I would like to take this opportunity to talk with you very specifically about some of the challenges that we and our clients are facing today.

Before jumping into that, however, let me lead in with some good news. After a challenging, slow period in the local purchase market, we have seen a recent, noticeable up tick in properties going to contract. We are also seeing a different attitude among buyers. Earlier in the year, buyers were worried. They were concerned that perhaps the market had further to fall, and that their property would be like a new car worth less after purchase. Todays buyers are comfortable with their value proposition, happy to be making a long-term commitment to the area, and excited about moving forward.

The thing that most concerns sellers and real estate agents is the fear that the buyer will not be able to obtain mortgage financing. I am happy to tell you that the buyers that we see who are mostly high-end buyers - are qualifying readily for mortgages and have a range of attractive choices for financing options.

That is the good news. Here is the reality check.

#1. Todays jumbo home market requires a minimum of 20% down for second home purchases; many banks require 25% or more. The days of buying a second home with 10% down are gone.

#2. The conforming loan limit in Litchfield County is and remains $417,000; mortgages higher than that amount are jumbo or super-jumbo. Conforming loan limits are higher in Fairfield County($708,750) and some other Connecticut counties.

#3. Appraisal procedures have changed significantly for most conforming loans and many jumbo loans. This change adds time, expense, and uncertainty to the mortgage process.

#4. The balance of power has shifted as between buyers and sellers. We see buyers insisting on private property e.g., furniture and antiques - being included in the sale. Our main concern in this area is to be sure that all parties understand that banks will not finance private property. Therefore, these items should not be included in the legal documents that will become part of the mortgage application. Rather, it is best if they are agreed upon in side addenda.

#5. We see some sellers pressing buyers to provide mortgage commitments in an unrealistic time frame. While we can understand that sellers are anxious, we would like all parties to understand that todays mortgage process involves more work, more paper, and more time. All parties must work together to obtain a commitment in a timely fashion. For instance, when we request all pages of an asset statement, we do so because the lending institution requires it. If the borrower provides just the first page, then we need to go back to the borrower, request the additional pages, receive them, and etc. Delays in responding to information requests slow the process and may jeopardize rate locks and closing dates.

Bottom line, things are not as simple as they used to be. However, we still have a functioning mortgage market with attractive rates and appealing options. It is just more difficult to navigate through that market; that is where we can help.

Through these trying times, our business has continued to prosper and even to grow. We want to thank all of you for your role in our business success. Our business is built on referrals from satisfied customers and from colleagues in the business who have had good experiences with us. Again, thank you!

As always please do not hesitate to call or email if I can help you or your clients in any way. It is never too early in the process to call.

Craig M. Cooper

President, Hourglass Mortgage

Phone 860.868.2810

Fax 860.868.2610