First Day at Homeshow Huge Success

Day one of the home show is drawing to a close. The doors are open just ten more minutes and all the vendors I talked to were excited about the amount of people out looking around. MC Squared Technology group and myself shot a short video about the show and posted it to www.lifeinlansing.com. You can view it on the front page. A new twist for the show this year is educational seminars. So far they have had full audiences. The topics tomorrow include; how to build a pole barn, financing options, "green" flooring, outdoor living spaces, and a remodeling seminar. I look forward to seeing you here.

Home Show Ready to Shine

The Booths are almost built, the carpet is getting put down, and ticket sales are about to begin. All that is missing is....YOU! Tomorrow the doors open on the annual Greater Lansing Home Builders & Remodelers Spring Home and Garden Show. You won't be disapointed this year. The hours are posted on the website, and stop by BOOTH 142 to visit us and write your own review of the show. See you there.

Greater Lansing Home Builders and Remodeler's Show

Just wanted to leave a quick note to join us in booth 162 at the Home builders Spring Home Show. It is located at the Summitt on the west side of Lansing. Follow the link HERE for directions and times. I bringing my laptop and will have our new website set up and you will be able to write a review of the show right our booth. There will be many other exciting opportunities to see showcasing what builders and remodelers are doing in our region. I look forward to seeing you there!

Is it time to buy a home or investment property yet? A study guide to reading the market.

In every market there are signs that tell you what the market is doing at any given time. These are called indicators. This post will show the indicators I use for looking at the market and trying to read where it is going. Please remember this data is being provided for you to look at and I am no way offering advice for what you should do. These are my opinions, and should be used to start a discussion only. One point to remember, even in a down market there is still a market. So it is important to find where it is and capitalize on it. The next few paragraphs may be a little too much information, so if you just want a one paragraph synopsis, skip to the last one. Other than that, if you really want to get more in depth with your market, hope this helps.

The first and most important indicator to me is population. If there is population growth, there is a need for housing. According to the “Real Estate Guys Radio,” the Detroit Metro area is getting 2 to 1.5 inquiries of people wanting to move out verses people wanting to relocate here. One of the best ways to track this is talk to a moving company or your local cable service may be of service if you know someone there. They can tell you how many hookups verses cancellations they are getting. Remember, these are not exact sciences, but they will give you an indication of what is going on in the market. Unfortunately, from talking with people in these fields around here, we are seeing population loss in Lansing as well. It is no surprise when you look at another important indicator and one which is very easy to track, absolute employment. This is tracked through the Bureau of Labor and Statistics. If you live in Lansing, search for the Lansing-East Lansing MSA, or Metropolitan Statistical Area. This is usually a few months behind, but I use it to look at trends. Absolute employment shows the actual number of jobs a region currently has. I use this instead of unemployment rate because when someone has been out of work for the allotted time on unemployment, they are no longer used in the statistic from the State as an employable person. If you look year over year for the last few years we are still trending down. Most likely we are going to see annual numbers for 2008 be a couple of thousand jobs under 2007. This is our third year of job shedding in Lansing. When there is a turn around here, things should start stabilizing and the region will start getting healthy again.

We also made history for new houses in our area according to the Greater Lansing Home Builders Association. December of 08 was the first month no single family home permits were pulled in our region. NAHB states builders are in a “de facto moratorium”.

This leads me into tracking monthly permit data from Texas A&M Research Center. Permits for our area are under 300 for 2008 according to their data. This may change a little bit from rural areas that only report once a year. I think you will see this number get adjusted to close to 400 or so for 2008. Even so, this is the lowest result since the early 80’s. It may even be another record book statistic for lowest in history since data was kept. Here is the link to view what the research center has published, http://recenter.tamu.edu/.

Existing home inventory levels in the tri county area also give us a pulse of what the market condition is. Currently there are just over 3800 homes listed on the Greater Lansing Multiple list service. If you take the last 12 months of sales and divide the current number of homes available, it shows that currently there is a 10.5 month supply of houses listed in the Greater Lansing Area. This is down from the last time I ran this ratio.

SO… What does this all mean to me?

First the new home permits levels falling off with no permits being pulled in December is a good thing for our market. Since I started tracking new home permits verses sales in 02, I have watched our inventory grow from around a 6 month supply to over 15 months. When I looked at current sales against inventory levels the end of 2008, we were around 13 months meaning that the market inventory is finally stabilizing. Unfortunately for us in Lansing we may be in for another small downturn before we finally level off and start back up the market cycle. This is based on the current announcement of 1500 jobs being cut in our area in manufacturing. It will most likely mean that we will see a little more erosion in our home values in the market. We need to see a turn around in the jobs market for the region to stabilize. It looked like we were going to see that last year but unfortunately we still had a slight downslide.

Under all of the bad news currently in the Lansing Market, small start up businesses and small entrepreneurs are beginning to sprout up and bring new life to our economy. This is a trend that is being showing up nationally as well. As large companies downsize ex-employees are becoming business owners since they are unable to find work at other companies. I feel that this is going to play a significant role in the revitalization of the Lansing Region. Even though we are seeing articles in our local paper stating that 2009 is going to be a rough year for commercial real estate, small businesses have a great opportunity to get into real estate for their companies cheap.

The answer to the question posed in the title, Is it time to buy a home or investment property yet?, is really for you to decide. What the indicators show is we may be hovering near the bottom now. What will get me to say we have absolutely hit bottom is when I see a year of the employment trend growing. What that means is we won’t know bottom has hit until we are well out of it. The only solace is, everyone finds out that way. It important to use education, and the experience you have gained and from professionals to find what is best for your situation. The real estate market like any other is cyclical. Many people told you in the late 90’s and early 00’s that they could time the stock market and become rich, well, who got the bigger bailout. I am certain that in the long run real estate will be worth more in the future than it is now. Since I believe that, it is time to get educated about the market and get out and find property. Signs of life are starting to show through the proverbial snow. Be careful, but get out and look and see what is going on around you in your market place. If you are not in the Lansing market, use the web links here and through your own research to see what is going on in your market. Deals are available for either investment or for your next home. And remember, once the growth has started it may be too late to get the best deal.