Rates are low and inventory is high…it truly is a great time to buy a home in Watertown.

As we look at the end of the 2nd quarter in the Watertown, Kampeska and Pelican market, our sales are still down compared to 2010.  We are down 11% compared to 2010 in total dollar volume of sold listings and we are 18% down in total number of sold listings compared to 2010.*

We have a great inventory of homes on the market in every price range.  Even if you have been thinking about buying a home, it is a great idea to visit with your mortgage lender and see what they can do for you.  You might be surprised at how low the rate is!  Once you are pre-qualified it makes you a great buyer and you will have plenty of quality homes to choose from.

If you or someone you know is considering purchasing a home, please talk with your local lender and your local REALTOR.  They will team up to get you the best deal ever!

*Statistics are taken from the NESD Board of Realtors MLS for the Watertown, Kameska and Pelican markets.

After a long winter, Watertown’s local market is taking time to rebound compared to 2010.  Listings sold as of May 31 were down by 16% when compared to 2010.   With the warmer weather, we have seen more activity in the last few weeks.  We’re anticipating that the activity will turn into sold properties to end the 2nd quarter strong.

New listings were up in May so buyers will have more choices.  As of May 31, there were 11 months of supply on the market.   This number tells us the amount of time it will take for the current inventory  to sell.   6 months’ supply is considered  balanced market  (when the number of listings roughly equals the number of buyers).   Over 6 represents a buyers market and under  6 represents a seller’s market.    

When we break this absorption rate down into price ranges, we show the $150,000-200,000 price range as the most active with only 7.7 months of supply.  Not far behind is the $200,000-250,000 and $100,000-150,000 price ranges at 8.6 months and 9.2 months respectively.  These numbers indicate a buyers market.  Paired with great interest rates, we should have plenty of buyers out there looking to purchase a new home!

Other interesting statistics that I would like to share today are the median sales price which is up to $142,950 and the average market time which is currently at 146 days.  The median price shows us that the home values are staying steady as this figure is very close to where it was last year at this time.  This is great news as we see larger markets continue to drop in median price.

As we look at the first 5 months of 2011, we see a slow start.  It is, however, a better start than what we had in 2009.  Watertown’s market is still steady and doing well.  Mortgage rates are low and it is a great time to buy!  Our community continues to promote growth and we will see the market come back strong.

**All statistics discussed in this article come from the NorthEast SD Board of REALTORS Multiple Listing Service.  Statistics are taken from the Watertown, Pelican and Kampeska areas.

By doing your homework before you buy, you™ll feel more content about your new home.

1. Decide how much home you can afford

Generally, you can afford a home priced 2 to 3 times your gross income. Remember to consider costs every homeowner must cover: property taxes, insurance, maintenance, utilities, and community association fees, if applicable, as well as costs specific to your family, such as day care if you plan to have children.

2. Develop your home wish list

Be honest about which features you must have and which you™d like to have. Handicap accessibility for an aging parent or special needs child is a must. Granite countertops and stainless steel appliances are in the bonus category. Come up with your top-five must-haves and top-five wants to help you focus your search and make a logical, rather than emotional, choice when home shopping.

3. Select where you want to live

Make a list of your top-five community priorities, such as commute time, schools, and recreational facilities. Ask your REALTOR ® to help you identify three to four target neighborhoods based on your priorities.

4. Start saving

Have you saved enough money to qualify for a mortgage and cover your downpayment? Ideally, you should have 20% of the purchase price set aside for a downpayment, but some lenders allow as little as 5% down. A small downpayment preserves your savings for emergencies.  

However, the lower your downpayment, the higher the loan amount you™ll need to qualify for, and if you still qualify, the higher your monthly payment. Your downpayment size can also influence your interest rate and the type of loan you can get.  

Finally, if your downpayment is less than 20%, you™ll be required to purchase private mortgage insurance. Depending on the size of your loan, PMI can add hundreds to your monthly payment. Check with your state and local government for mortgage and downpayment assistance programs for first-time buyers.

5. Ask about all the costs before you sign

A downpayment is just one homebuying cost. Your REALTOR ® can tell you what other costs buyers commonly pay in your area”including home inspections, attorneys™ fees, and transfer fees of 2% to 7% of the home price. Tally up the extras you™ll also want to buy after you move-in, such as window coverings and patio furniture for your new yard.

6. Get your credit in order

A credit report details your borrowing history, including any late payments and bad debts, and typically includes a credit score. Lenders lean heavily on your credit report and credit score in determining whether, how much, and at what interest rate to lend for a home. Most require a minimum credit score of 620 for a home mortgage.  

You™re entitled to  free copies of your credit reports  annually from the major credit bureaus:Equifax,  Experian, and  TransUnion. Order and then pore over them to ensure the information is accurate, and try to correct any errors before you buy. If your credit score isn™t up to snuff, the easiest ways to improve it are to pay every bill on time and pay down high credit card debt.

7. Get prequalified

Meet with a lender to get a prequalification letter that says how much house you™re qualified to buy. Start gathering the paperwork your lender says it needs. Most want to see W-2 forms verifying your employment and income, copies of pay stubs, and two to four months of banking statements.  

If you™re self-employed, you™ll need your current profit and loss statement, a current balance sheet, and personal and business income tax returns for the previous two years.  

Consider your financing options. The longer the loan, the smaller your monthly payment. Fixed-rate mortgages offer payment certainty; an adjustable-rate mortgage offers a lower monthly payment. However, an adjustable-rate mortgage may adjust dramatically. Be sure to calculate your affordability at both the lowest and highest possible ARM rate.

More from HouseLogic

Learn how Fannie Mae and Freddie Mac mortgages can help you save on financing

Learn more about the costs of homeownership

Other web resources

Homebuyer counseling resources

Get a free credit report from each of the three credit reporting bureaus

G.M. Filisko is an attorney and award-winning writer who has thrice survived the homebuying process. A frequent contributor to many national publications including Bankrate.com, REALTOR ® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

Thinking about selling your home?   Please read the  article below  for helpful tips of what NOT to do.   Mistake  #1.   Over-Pricing Your Home Perhaps the most challenging aspect of selling a home is listing it at the correct price.  Over   pricing is the SINGLE BIGGEST mistake a seller can do.  It™s one of several areas where   the assistance of a skilled real estate consultant can pay for itself versus trying to sell your   home yourself.         If the listing price is too high, you™ll miss out on a percentage of buyers looking in the range   where your home should be priced.  Some people think that if they leave some œwiggle room   in the price, they’ll always have the opportunity to negotiate and accept a lower offer.     * However, chances are the offers won’t even come in, because the buyers who would be   most interested in your home have been scared off by the price, and won™t even take the   time to consider it.  By the time you correct the price, you™ve already missed exposure to a   group of potential buyers AND the longer your home sits on the market,,,,,,,,the less   interested  buyers (and their realtors) are in seeing it.  Over pricing your home  to leave room   to negotiate  almost ALWAYS backfires. (homes in  Watertown are selling for around 96.2 %   of asking price)  Listings expire and don’t sell when they  are overpriced. That always has been – always will be the # 1 reason a home doesn’t sell.     An experienced, well-trained real estate consultant is always in touch with market trends “   often even to a greater extent than appraisers, who typically focus on what a property is   worth if sold as is, right now. Mistake #2. Curb Appeal When you™re preparing your house for sale, remember the importance of first impressions.     A buyer™s first impression can determine whether they™ll choose to look inside.   It™s estimated   that more than    50 percent of shoppers decide to purchase a home even before they get   out of their car.   With that in mind, be sure to stand outside your home and take a realistic   œfresh look.   Then ask yourself (and your Realtor) what you can do to enhance the œcurb   appeal.   It could make a significant difference in your final sales price as well as the speed of   your sale. It’s been said that you can recoup as much as 150% of the money you spend on   enhancing curb appeal. Why knock out 50 % of potential buyers with poor curb appeal ? Mistake # 3. Not Deep Cleaning Your Home   Buyers today have a plethora of homes to choose from, and a clean home makes an impression. Buyers might assume that a dirty  bathroom means the property has not been taken care of properly. This leads to low-ball  offers, if any offers. Hire a cleaning crew to come in and do a really deep initial cleaning to  make your home shine. On top of that, keep in mind that your home should not only be clean  but also smell clean. Investing in lots of air fresheners (we use Glade™s Plugins), especially in  key areas like the entrance of your home and the kitchen, is well worth the money. Who  doesn’t just feel home right away when a warm scent of vanilla or cinnamon greets them at the  door? Buyers are definitely influenced by their senses. Buyers will snoop and yes they look in  showers, open closets and even study the garage. DEEP cleaning will pay off BIG time. Mistake #4.   Dated or worn hardware and fixturesIf floors and walls are the bones of  the house, then hardware and fixtures are the “jewelry”.   Outdated or tarnished door handles on kitchen and bathroom cabinets, and outdated lighting fixtures and faucets are a turn-off to  prospective buyers.   Replacing these can update the look of a bathroom or kitchen  very  inexpensively.   And don’t forget to replace scratched doorknobs on doors and broken or non-matching light switch plates. It’s one the LEAST expensive ways to jazz up your interior.    Mistake #5. Choosing the wrong Realtor, or choosing him/or her for the wrong   reasons It ´s likely that you don ´t interview people very often. And yet in order to find the Realtor   who is right for you, you may interview several. The quality of your home selling experience is   dependent upon your skill at selecting the person best qualified. Many sellers use a friend of a   friend because they “just got their license” or use a realtor that suggests a higher listing price   than another realtor. Beware – a Realtor has no more control over “getting a certain price” for   a home anymore than a stockbroker has control over making a stock go UP in price. Good   Realtors are skilled in many areas including: home construction, financing, contracts, marketing,   and much more.

The first quarter sales and new listings for the Watertown and Lake Kampeska areas are down compared to 2010  according to the Multiple Listing Service of the Northeast SD Board of Realtors.   Based on statistics provided in the Yearly Market Comparison, sales are down 12% for the first quarter and new listings are down 18.4%.   We saw our biggest decrease in new listings in March where we listed 90 properties in 2010 and only 51 in 2011.  

Many Realtors contribute this to the huge piles of snow the refuse to go away!   Today we are seeing more grass & sun and less snow.   With that, we’ve also seen more activity of buyers and sellings getting into the market.   We hope to see the market turn around as the snow melts and we all come out of our winter caves.  

Keep checking back for more news and statistics.   As your Watertown Real Esate Expert, please keep me in mind for buying or selling your home.   Or, if you know of anyone in need of real estate advice, please send them my way.   I’m happy to help.

Happy Spring!