Wasilla Real Estate News, Valley Market Real Estate

Alaska Land, How Much Do You Want? November 16th, 2007

Categories: Wasilla Real Estate News

People moving to Alaska from Midwest states usually want a house with some “land”. By that they mean they want to have at least 5 or 10 acres along with the house. They are always surprised to find that is very hard to find “land” in the Alaska.

Alaska has more land by far than any other state in the United States. It is more than twice as large as Texas, but only about 1% of the land is privately owned.

Actually more than that is privately owned if you count the huge expanses owned by Alaska Native Corporations. For example, Doyon Ltd., one of 13 regional native corporations, owns 12.5 million acres by itself. There are many smaller village corporations that also own large tracts of land. In general, they aren’t selling. The land is their heritage and they are keeping it.

The Federal government and the State government own the rest of the land. Most of the Federal land is National Parks, National Forests, or Wildlife Preserves. The state owns a lot of land and does sell it in a very slow and methodical manner.

That leaves the rest of us on less than 1% of the land. That means about 3,750,000 acres are privately owned. That’s quite a bit less than the size of the State of Massachusetts.

Couple the small amount of private land with the fact that the transportation and electric utility grid in Alaska is extremely small, you reduce the available land even further.

People don’t realize that Alaska is still a pioneer state. Most of the state is not reachable by road vehicle. I don’t care how good of a 4X4 you have, you can’t drive there. And then, there are a lot of places you can drive to, but you can’t connect to power once you get there.

So, you have a choice. You can buy a lot of land out in a remote area, set up a tent, and commute by plane, you can pay a high price for the few available pieces closer in, or you can settle for a smaller parcel. Most of us choose the latter. We actually want to be able to afford a house with our land so we end up settling for about an acre of land.

But just think….our acre of land is only 10 minutes or so from Alaska!

Written by Marty Van Diest 6 Comments »

Wasilla Real Estate; Monday Morning Market Memo 11-12-207 November 12th, 2007

Categories: Monday Market Memo

These statistics include all residential listings in the Mat-Su Borough.  This includes Wasilla, Palmer, and all the outlying areas between Talkeetna and Eureka. 

There are several surprises this week.  First, we had 35 new listings come on the market this week, 36 pendings, and 22 closed sales. Those are all healthy numbers for this time of year. 

		Average Price	DOM
New	35	$242,636	.
Total Active	867	.	.
Pending	36	$203,486	86
Closed	22	$289,046	75

Notice the high average price for closed sales last week.  That number has been hovering around $200,000 for months.  Last week there were several higher end homes that closed edging the average higher. 

But the record breaker was a $1,500,000 sale of a listing by Lee Mitchell at RE/MAX of Wasilla.  I checked several times and we have no closed sales over one million dollars for the valley on the MLS…until this one.  Congratulations Lee, maybe this will break the ice and we will see lots more million dollar sales in the Mat-Su Valley.

Interest rates are still at historic lows, just over 6% with some special loans coming in in the high 5% ranges.  One of the reasons for the low value of the dollar is the low interest rates pushed by the Federal Reserve.  This, along with $800+ gold and high oil prices risks inflation.  If inflation kicks in, interest rates will rise very quickly.  Buyers who wait for lower house prices may be shooting themselves in the foot by not locking in these low interest rates now.

 

Written by Marty Van Diest 2 Comments »

MatSuMLS Is History November 11th, 2007

Categories: About Wasilla Real Estate News, For Buyers, For Sellers

I have had quite a few questions about what happened to www.matsumls.com.  If you click on it, it will go to an error page.  That is because it was bought out by AlaskaMLS inc.  MatSuMLS was owned by the Valley Board of Realtors who ran the Valley MLS system.  Most Mat-Su valley real estate companies belonged to both MLS systems.  Now there is only one MLS system for Valley Realtors, and that is the Alaska Statewide MLS system.

Alaska MLS inc. is a  broker owned, not Realtor owned, MLS system that has all of the Anchorage, Kenai, Kachemak, and now the Mat-Su Valley listings.  There are additional listings from many other areas of Alaska on the Alaska MLS system. 

The new place to search is the public website for the Alaska MLS.  That site is www.alaskarealestate.com .  Don’t go to MatSuMLS.com any more, it doesn’t work.

Written by Marty Van Diest 1 Comment »

Mat-Su Foreclosures. The Good, The Bad, and the Ugly, Part 3 November 10th, 2007

Categories: For Buyers

Foreclosures Part One was about pre-foreclosures,Part Two was on foreclosure auctions, this article will be about the most common foreclosure purchase.  That is purchasing a foreclosed house that is represented by a Realtor.

Many people assume that foreclosures are automatically good deals.  The truth is that most foreclosed properties are sold for exactly what they are worth.  You can’t expect to buy a foreclosure that is listed by a Realtor and immediately make a profit on it.  By definition, lenders are professionals in financial matters.  It is in their best interest to receive the highest price possible out of every house in their possession.  They usually accomplish this through time tested methods.

After an institution takes possession of the property at the auction they immediately secure the property and change the locks.  Occasionally, if the property is abandoned before the auction they will do this previous to the auction.  The property will be winterized and inspected by a property manager. 

An appraiser and a Realtor will provide a value to the lender.  The lender will occasionally get more than two opinions on the market value of the property to help them determine their initial asking price.  The initial list price is often slightly higher than the real market price.  The lender will then go through a series of price reductions at regular intervals. 

The property in the top photo is currently listed with Elizabeth MacMullen of RE/MAX of Wasilla for $283, 500 and it initially had a ten day hold.  The ten day hold means that the seller will not open any offers for ten days.  That is too ensure that if they undershot the price, more than one buyer will compete for the property and potentially bid the price up.  If the property doesn’t sell for a period of time, usually about 45 days, they will drop the price by a fixed amount.   There will be another ten day hold after every price reduction.  This will continue until the price and the market value will eventually meet and the house will sell.

Although this is not the best strategy in a declining market, private sellers would be wise to take a hint from the professional sellers.  The foreclosed homes always eventually sell, and they sell for their value without leaving a lot of money on the table.  The only problem is that in a declining market if the lender initially overpriced the property, they will chase the market price down, eventually selling for a lower price than they would have if they would have started out at a lower price.

I had a lender do exactly that last year.  I suggested a price of $170,000 but they listed it for $199,000.  We got seven offers on the property before they eventually took $155,000.  The crazy thing is that all six of the previous offers were for more than $155,000.  Like most lenders, they have a previously determined margin in which they will entertain offers.  All of the previous offers on this house were just outside that margin and were rejected.  Then the lender would drop the price and someone else would make another offer for a little lower than the margin, we slowly marched down in price until we finally had someone step in at $155,000. 

It is important to realize that lending institutions aren’t your normal everyday sellers.  For example, they are not as willing to pay the closing costs most sellers agree to pay.  They will usually not pay for an appraisal, title insurance, or asbuilt surveys.  They usually do not pay for any repairs needed on the structure.  Sometimes they will not pay any closing costs at all so that the buyer needs to pay all of their own closing costs and also the costs normally paid by the seller.

Most of the time you will need to patiently wait for the wheels of bureaucracy at a big bank to slowly turn.  You might write an offer hoping for a quick response only to find out that you will be lucky to hear anything at all from the bank for up to two weeks. Sometimes it will be much longer than that before they will respond to your request.

If you would like to take a look at any foreclosed properties, give me a call.  I enjoy comparing these properties to others on the market.  The nice thing is that you know the bank will eventually come down to the market value.  Many, and perhaps most, current private sellers refuse to come down to the market value and let their listing expire.  They hope to wait for anther sellers market before selling at a reduced price.  A bank is going to sell their property, no matter how low they have to go to get it done.

My cell number is $232–7900…  Or just click the contact button to the right to send an email.

Written by Marty Van Diest 3 Comments »

Monday Morning Market Memo 11-5-07 November 5th, 2007

Categories: Monday Market Memo

The total inventory dropped significantly this week.  That’s because many homes were listed only through the end of October and the owners chose to not relist them during th holidays.

We did get thirty new listings. Of these 30 listings, six of them are foreclosed homes.  That is 20% of the new listings for the week.  Hopefully this is just an anomaly that will not be a continuing trend.

This week both the pendings and closings averaged in the mid $200s.  Quite a few higher end homes sold this week to bring the average up. 

		Average Price	DOM
New	30	$247,787
Total Active	887
Pending	24	$246,467	99
Closed	24	$252,402	83

Below to the left is the Alaska MLS chart for the valley up through Oct.  The chart to the right is for comparison and includes all the listings on the MLS system.  This includes the Valley, Kenai, and Anchorage.  It is interesting to note that the outstanding inventory in the Valley is actually lower than it is for the whole MLS. 

Written by Marty Van Diest Please leave a comment.