Looking to buy?
HAVE YOU TRIED to buy a house lately? A dearth of homes on the market and intense competition for anything livable and affordable has made home buying in Marquette County as challenging as it is rewarding. A real battle.
There’s only a finite number of existing homes for sale and according to Stephanie Jones of Select Realty, the new home market is stressed as well.
“The hard part is that the costs of building are making it challenging to create new inventory,” says Jones.
Erin Wasik of RE/MAX 1st Realty agrees. “In recent years, a steep increase in the price of lumber and other building supplies, disruption in the supply chain, and restrictive zoning laws have caused a significant decrease in the number of new homes being built. Additionally, in a college town like Marquette, many homes that would typically be in a first time home buyer’s budget are not on the market because they are owned by individuals or companies who rent them out to tenants.”
Commissioner Evan Bonsall is one of our city leaders who acknowledges the problem and the need for some kind of solution.
“This is unsustainable, and it’s pricing many working-class people out of our community, including young professionals and students, families with children, retirees on fixed incomes, and seniors who are looking to downsize.”
Remember all those distinctions Marquette has received over the past few years? Great place to live… #1 city for this or that… desirable destination… etc., etc.
Every time you see another accolade like that, the price of living here goes up. You want a cheap house? You might have to look somewhere else… not so nice.
Costs on just about everything we purchase continue to go up. When that adds fifty cents to a tube of toothpaste, you can still buy the toothpaste. Add fifty grand to the house you’d like to buy, and that could be a deal breaker.
Then there’s the whole “home as investment” issue. Many analysts suggest that the return on investment is comparable to what you’d realize if you put that same money in the stock market. Values will generally increase, but in both cases, external factors over which you have no control can spoil your plans.
But of course there’s value in homeownership in addition to the investment. You also get a place to live. And when you pay your mortgage, you are basically being forced to save, something renters don’t experience.
The pandemic has influenced everything, including home sales. But not necessarily in a bad way. Chris Cosco of RE/MAX 1st Realty says it hasn’t been the negative we might have expected.
“The Covid-19 quarantine did not slow down sales and if anything it increased during the shut down. I was selling houses last March and April using virtual tours and Facebook Open Houses it was kind of weird to get used to at first but worked pretty well. So the pandemic had influence on the sales but in a positive way for sure.”
Homebuyers and sellers aren’t the only people affected. Local real estate agents, and there are plenty of them, also feel the pinch. If there are 100 homes listed and more than 150 agents, as Jones pointed out in a recent Facebook post, well, something’s got to give.
Wasik says the actual number of working agents is hard to nail down. “My experience has been that anyone who puts their whole effort into making this a career will make it. I think the number of licensed real estate agents vs the number of agents who are actively engaging in sales can be a bit deceiving.”
Terry Huffman of RE/MAX 1st Realty has seen just about everything in his years selling homes. “When the market looks easy agents come out of the woodwork; when it gets real they go away. Seems like every year though about 10% of the agents do about 90% of the business.”
According to Huffman, a small number of the available listings is handled by the For Sale By Owner crowd, but the idea of maximizing your take with the do-it-yourself method might be shortsighted.
“The process hasn’t gotten simpler; in fact with multiple offers and escalation clauses and governmental mandated disclosures, it’s gotten much more complicated, and costly if you make a mistake.”
Cosco echoes those sentiments. “It’s very challenging to handle multiple offers on a house and stay within the guidelines of the laws. We are trained for these types of markets and people use us for our expertise to get the most for their house in the shortest possible time frame and do it while following the guidelines of the laws that the state sets. So just because you can doesn’t always mean you should!”
But when a real estate agent sells a property, that’s a windfall, right? Six percent of $300,000? You do the math.
Before you pencil in the profit, don’t forget to subtract the costs of running a business, because that’s what agents do. Though they’re usually affiliated with an agency, they’re basically independent business people, with all the associated costs, including a cut to the agency.
Start with 6% gross and after all the bills are paid, the net is the real gross number.
Looking to sell?
FOR EVERY ACTION there’s an equal and opposite reaction, and in this case… if you’re thinking of selling your house, now’s the time.
Look Realty owner Steve Pelto acknowledges current market conditions. “Without a doubt this is a seller’s market… we’re seeing multiple offers on homes.”
And that takes us back to where we started. Multiple offers is another way to say bidding war. Is that what you were hoping for when you started looking for your dream home. Warfare?
Like most successful agents, Pelto stays positive.
“The pandemic had people sitting in their home or their rental thinking it’s a good time to make a change. With interest rates low and banks looking to lend… now is the time to buy!” And apparently… the time to sell, too.
DUE TO THE RECENT warm weather, the Greater Ishpeming-Negaunee Area Chamber of Commerce has cancelled the West End Winter Wonderland scheduled for this Saturday, March 13 at Al Quaal Recreation Area.
The final Ice Race in Gwinn scheduled for Saturday has also been cancelled due to the unexpected thaw.
As if coronavirus cancellations weren’t bad enough, now we can’t even count on winter weather.
And that’s what’s happening this weekend!