Jeff and Maryellen Reynolds were happy to welcome Ruth to the Rescue to their new home in Sterling Heights. However, they faced some big challenges when they were looking for the home they just bought in March.
"Every offer that we put in, there was either one or two or multiple offers pending on it," said Maryellen Reynolds.
"It was very tough," agreed her husband. "Went pricing 20-30 houses, and the ones we really did liked were already sold, or had pending offers."
Mortgage broker Debra Esquivel says she's seeing the same thing, which is better news for homeowners with houses to sell.
"They're selling very quickly. Often times, there are multiple offers on homes and many of the homes are selling over the asking price," said Esquivel, who works for Mortgage 1.
Prices Push Higher
Local analysts say the turnaround pushed median home prices up around 30 percent in Oakland (35.4%), Macomb (27.6%), and Wayne (31.6%) counties in April. Realtors are telling buyers their financing needs to be pre-approved, and they need to be ready to move quickly if they see something they like.
"I let them know that we're going to put their tennis shoes on and run really fast because the market is moving very quickly," said realtor Denise Consiglio, of Real Estate One.
That's advice the Reynolds took to heart when they saw the home they now live in. "As soon as we went through the house, we were in the driveway and we just looked at one another-- and just said, 'You know what let's just tell them we want to put an offer on it.' We did not want to lose this house," said Maryellen Reynolds.
Realtor Denise Consiglio says buyers also need to be flexible and ready for possible disappointments. "It's very emotional because they see themselves in that house," she said.
Time to Sell?
On the flip side, it's a great time to sell. The Reynolds sold their previous home in one day and they got the price they wanted. If you've been sitting on the sidelines, waiting to sell, this year could be a good time to put that house on the market.
What About Fixer Uppers?
Why are homes going so fast? Our experts say there aren't many high quality homes on the market. After the crash, there are still many homes that may have been foreclosed, or stood empty. Those homes usually don't receive the same loving care that seller-owned homes are getting from their owners.
Esquivel wants buyers to know there's help for people who might be tempted to buy one of those fixer-uppers. She sent these notes to RTTR about the FHA 203K Loan, which gives the buyer more to rehab properties.
*It's mortgage loan in which extra money is rolled in to fix up the home or do desired updates or repairs. These repairs must be done by an insured, licensed contractor (with exception of painting and small easy fixes) and can also be used to buy appliances.
*The limit on the FHA 203k streamline (most common one) loan amount is $35,000 for repairs. This means in addition to the purchase price of the home ($100,000 + $35,000), we would loan them $35,000 for repairs. The full 203k requires a structural engineer and can give considerably more money and is done far less often. It cannot be used to do structural repairs nor can it be used on condos due to the deed restrictions.
*Remember, FHA is limited to owner occupied, single family or 2 family properties and also subject to standard FHA loan limits which vary from county to county but currently (about $271,050 in Oakland and Macomb Co).