According to NAR, existing-home sales (including single-family, townhomes, condominiums and co-ops) rose to a seasonally adjusted annual rate of 5.18 million units last month, up 5.5 percent from August and up 1.4 percent from September 2007.

“Compared to a fairly small share of foreclosures or short sales a year ago, distressed sales are currently 35 to 40 percent of transactions,” said Lawrence Yun, NAR’s chief economist, in a statement. “These are pulling the median price down because many are being sold at discounted prices. The current market is not being dominated by speculative investors. Rather, 80 percent of current buyers are purchasing a primary residence, which is a bit higher than historic norms.”

While the average rate for a 30-year, conventional fixed-rate mortgage dipped from 6.48 percent in August to 6.04 percent in September, the national median existing-home price for all housing types fell 9 percent from a year ago to $191,600.

According to NAR, sales of existing homes jumped the most in the West (up 16.8 percent from August and up 34.4 percent from September 2007) and were up in all regions except for the Northeast where sales were down 1.2 percent from August and 7.7 percent from a year ago.

Priced dropped the most in the West (down 18.5 percent year-over-year to $253,600) and fell the least in the South (down 4.1 percent year-over-year to $167,200).

Three recent surveys show continued turmoil in housing and financial markets have many Americans postponing decisions to buy or sell a home, but that they remain optimistic about the near-term prospects of a recovery and still consider a home to be a good investment.

The surveys — commissioned by real estate portal Zillow, real estate franchisor and brokerage Realogy Corp., and advertising firm J. Walter Thompson — suggest that should government action to unfreeze credit markets succeed, consumers stand ready to participate in a housing recovery.

Zillow’s quarterly homeowner confidence survey showed that when it comes to their own home’s value, many Americans may be out of touch with reality.

Although Zillow’s vast database of public records showed an estimated 74 percent of homes have lost value in the last 12 months, only 51 percent of homeowners polled believed their own home had lost value in the past year.

Asked to look ahead six months, 61 percent of homeowners said they expect their own home’s value will hold steady or grow. But they evidently didn’t think their neighbors’ homes would fare as well, since 57 percent said they expect home values in their local market to decrease in the next six months.

Only 3 percent said they’d try to sell their home in the next six months, down from 5 percent of those polled three months ago. The percentage of those who said they planned to buy a home in the next six months also slipped from 4 percent in the second quarter to 3 percent.

The increased reluctance to buy into a market when home prices in some areas have seen double-digit price declines could be a reflection of worries about where the economy is headed. The Harris Interactive online survey of 2,021 adults (including 1,388 homeowners) was conducted between Oct. 7 and Oct. 9, a week the stock market saw historic drops.

Zillow’s “misperception index” — a measurement of the difference between those who think their home’s value has increased and the percentage of U.S. homes that actually increased in value — has been cut in half, from 32 in the second quarter to 16 in latest survey.

“We are seeing some movement toward more accurate perceptions of home-value declines, but there’s still a significant gap between reality and perception,” said Stan Humphries, Zillow’s vice president of data and analytics, in a statement.

The survey also showed that worries about the economy have consumers cutting their household spending, “a fascinating distinction in consumer psychology” that demonstrates there’s “clearly still some denial,” about home-price declines, Humphries said.

Since the Zillow survey was conducted, the stock market has rebounded a little and there are some signs the credit crunch could be easing.

Realogy survey

In a survey of 1,023 homeowners conducted from Oct. 23-25 by Ipsos Public Affairs for Realogy Corp., 91 percent said they believed owning a home is still the best long-term investment they can make.

The survey also found that 27 percent said the current economic environment was causing them to put their plans to purchase a home on hold.

To jump-start home buying, Realogy is calling for the government to buy-down 30-year fixed-rate mortgage rates to 4.5 percent or lower for homes up to $1 million.

Interest rate buy-downs are sometimes used as incentives by sellers, who pay lenders extra points up front to obtain a reduced interest rate for a buyer. Buy-downs can be permanent or temporary — they are often phased out over two or three years.

Realogy says there are a number of ways the government could structure and fund an interest-rate buy-down program, which could be included as part of stimulus packages now being discussed by lawmakers.

Richard A. Smith, the company’s president and chief executive officer, said getting the government involved in buy-downs could have an impact on sales volume and home prices.

“We think the pent-up consumer demand for housing, if encouraged, is more than sufficient to stabilize housing,” Smith said in a statement. “In our view, substantially lower mortgage rates will stimulate both existing- and new-home sales, reduce home inventory levels, stabilize home prices and, ultimately, help the overall economy.”

In a separate poll of 1,500 real estate broker-owners, Realogy said 54 percent would expect a “significant increase” in home sales in their market from such a move. About 51 percent said lowering the cost of borrowing would also increase home prices. About one in 10 of those who expected price increases said they might be as much as 5 percent to 7.5 percent.

That might raise objections in some circles, as many economists believe home prices in some markets still need to fall further in order to restore affordability and reach levels where they are supported by fundamentals like income.

Realogy spokesman Mark Panus said the actual impact on prices would be “hard to handicap. It’s nice to see what the response (from brokers) is, but we are not dealing in absolutes.”

Panus said that while the government has taken many steps to prop up the financial system and help borrowers facing foreclosures, an interest-rate buy-down would stimulate sales.

“People are looking for a signal that it’s OK to move forward,” Panus said. Many are waiting on the outcome of the November elections and to see what additional stimulus programs Congress puts forward. “You wait until you see what all your options are, and until then, you may not act.”

American Dream survey

A third survey that addressed public perceptions about homeownership during the economic downturn was conducted from Sept. 11-19 by J. Walter Thompson.

The survey, of 2,112 adults, found homeownership ranked as one of the most important elements of achieving the “American Dream.”

Although financial security, finding happiness, personal independence, “fulfilling my potential” and freedom of speech ranked higher, those surveyed said homeownership was a bigger component of achieving the American Dream than “a better life for my children,” freedom from fear of oppression, and a comfortable lifestyle.

The so-called “American Dream in the Balance” survey found homeownership was important to all age groups, but slightly more important to baby boomers than any other group.

The survey found that only 65 percent of Americans with household incomes below $40,000 a year believe in an American Dream, compared with 75 percent of those earning $40,000-$70,000 and 82 percent of those with incomes above $70,000.

The price must be set realistically. Preparation should include fresh paint, de-cluttering, updated floor materials, and no glaring repair needs. And, presentation should be meticulous, with drapes open, lights on, lawn mowed, and interior cleaned.

Showing your home is the final step in winning the heart of a buyer. When a buyer calls for a showing, he or she already has an interest in your neighborhood and may have viewed your home on line. They are willing to invest time to visit your home. It is worth the effort to make each showing one that will be remembered. Here are some questions to consider:

1. Is your home easy to show?

If possible, schedule showings in the same way that is used by a majority of the homes in your area. This may be by special appointment or by a lockbox system. Remember that this will be the buyer’s first contact with your home, and it should set a positive tone. Make the buyer and agent feel welcome. Be as flexible on timing as possible. The buyer may be viewing many homes over a large area.

To allow flexibility, you could wait until they arrive, and then slip out the back door. You may get a last minute call for a showing. If this happens, start by thanking the agent for the interest, and discuss how to work with the timing.

I can recall instances in which the seller came to the door in a hostile way and demanded to know why we were 30 minutes late. Or, the buyers sensed that they were inconveniencing the seller or their agent by asking to see the house. Many people have a strong reluctance to intrude or bother other people. Remember that the decision to buy a home is emotional response. Don’t turn people off before they come in the door.

2. Does your home have emotional appeal?

Buyers use all of their senses to experience your home. The buyer is there to make a big decision, and they will be comparison shopping. Their job is to eliminate homes and reduce the list of choices. A dark interior, unpleasant smell, barking dog, or uncomfortable temperature can take the home off the list.

I see this happen all the time. The simple experience of being in the home during the showing is a key indicator of whether the buyer will enjoy living in the home later. Consider the builder’s model home. It very light and fashionably decorated, with soft music and pleasant scents. This sends a message to the buyer that the home has been prepared for him, and he is welcome to enter. People are often sold when they walk in.

Some tips: Take off some screens, open blinds, increase bulb sizes, play some light music, and make sure the temperature is perfect. Be careful that your scents are designer quality. Don’t use plug in scents that remind people of a public bathroom. Create a good mood with natural and lamp light. Use pillows, framed photographs, books, fresh towels and flowers throughout the home. Avoid having the TV on. Be very careful about cat litter boxes or other pet odors.

3. Are you staged and ready?

Sellers often ask if it would be best to show their home furnished or vacant. Of course this depends on how the home is furnished. If your home is dirty, messy, and poorly decorated, you need to stop and assess the situation. It may be possible to move out, and then stage the home with a few pieces of furniture and accessories. There are staging services that can help with this. Generally, some furniture will help to soften the interior and show it in an optimum way. However, I prefer a vacant house over a disaster.

It is important to keep the buyer’s focus on the property, and not on your family. Remove most of your personal collections, family photos, political statements or artistic expressions of yourself. These distract from the important mission that brought the buyer into your home.

The buyer must establish a sense of trust of your home. Messiness and confusion sends a deeper message that the home is not well cared for. It speaks volumes about how maintenance has been handled. You only have a few minutes to communicate that your home is the right one. Make sure the visit to your home is a pleasurable experience that keeps the buyer’s focus where it needs to be.

4. What would your buyer like to know?

If you were buying this home what would you want to know? Are there parks nearby that you could photograph? Does the school bus stop nearby? Anticipate your buyer’s questions and answer them. New homeowners are choosing a home, a community, and a lifestyle that your home offers.

Some ideas: Survey; floor plan; local parks; shopping; school data; or neighborhood newsletter.

5. What is the plan for kids and pets?

Children of all ages need to be coached on the showing process. Children should know that an advance call from an agent is required for a showing. This is very important if your children will be home alone. Figure out a plan for them to follow, depending on their age. For example, they may open the door for the agent and buyer, and then go next door during the showing. Discuss what to do if an unexpected person comes to the door asking to see the home. They must not allow entry to anyone who has not made prior arrangements through you.

If you have pet, consider a couple of points. One, pets may be fearful of strangers entering the house. Two, some people are afraid of, or allergic to, animals, and are not happy to encounter them. There will be a variety of people entering your home, including children. If you are unsure of how your pets will react to strangers, be sure to take them out during showings.

I recall a client who panicked at the sight of a small puppy in a home. I found that hard to understand until I realized that I reacted the same way to a ferret that was loose in a house that I was showing. I was ready to jump on the table.

If you have pets at home during showings, communicate this to the agent. Leave written notes in the house on where your pet is located and other special instructions. (Dog in laundry room; Cat must stay indoors)

6. Is your home safe for visitors?

Remember that showing your home is going to interfere with your day to day life. You will need to prepare for some inconvenience and intrusion into your privacy. Consider the safety of your visitors. There may be seniors as well as small children walking around your home.

Is there a statue or tall lamp that could easily fall if touched? Are there wires at ground level that could trip someone? Are there rugs that tend to slide? Are stair railings safe for small children? Could a visitor be bitten by a bird or other animal? Are the stairs free of small toys? Are traffic patterns open between rooms?

Also consider your own security and privacy. Put away valuable possessions. Do not leave money, guns, jewelry, x rated magazines or any personal items in public view. Do not leave breakable objects where they could be accidentally bumped. Move your medicines to a secure location. Do not leave bleach or poisons in reach of children. Do not leave candles burning when you leave the house.

7. Should you stick around?

Generally, it is not a good idea to be present for the showing. Remember that this is not a social visit. Most buyers will feel that they are intruding on your privacy if you are in the house. They may shorten the time spent in your home. Or, they may not be able to discuss your home as freely as they might have. If it is difficult to leave, you may sit outside or take a short walk.

Sometimes sellers try to offer certain information, and they inadvertently turn the buyer off. It is best not to make assumptions about what the buyer wants. Keep in mind that buyers are there to make a big decision. They need some time to experience your home on several levels. If it passes the first test, there will be time to communicate how many water heaters you have and other facts about the house. I recall one showing in which the sellers actually grilled the buyer on his reaction to every room, and then argued about it. It was a relief to leave.

Showing your home is a very important step in getting it sold. Potential buyers should be treated with utmost care and respect. You only have a short time to gain their trust and interest in your home. Every showing is important. It is said that you only need one buyer, but you don’t know which one.

Now that we no longer have cheap energy in America, we will have to alter our thinking about how we travel and how we live. Buying that hybrid for fuel savings may not be the real solution; your home consumes much more fuel than your car. With good planning, this consumption can be partially reversed and you can actually make money by selling your energy back to the electrical grid. This can be done through Photo-Voltaic applications that can be researched on-line or discussed locally with Randy, Claudia or Allan of Positive Energy, 505-424-1112. They have been working 12 years with the Photo-Voltaic science and have the best understanding of its application.

John Wolf’s Tracks are a regular feature on KCSantaFe.com
For more information about construction in Santa Fe or to speak with John Wolf contact him at:

Wolf Corportation

984 Acequia Madre
Santa Fe, New Mexico 87505
phone: 505.983.5511
fax: 505.983.6786
Email Wolf Corp

Wolf Corporation specializes in the construction of large (4,000 to 25,000 square foot) custom homes and specialty public buildings. We are also recognized for historic renovation, addition and remodeling work performed to the highest standards. Among our more prominent projects completed in Santa Fe are The Georgia O’Keeffe Museum, its nearby O’Keeffe Research Center, The Allene LaPides and Riva Yares Galleries, The Wheelwright Museum of the American Indian, various medical facilities and several Bed and Breakfast residences.

Santa Fe’s Historic Eastside Solds for 2008 show the average listing price at $539/sq.ft and average selling price at $493/sq.ft. with average listing price at $1.235M and average selling price at $1.1M with an average of 236 days on the market. Please keep in mind that these statistics are relating primarily to Santa Fe’s winter market which is not typically our strongest season for luxury home sales, particularly in the Eastside. Hence, I will be updating these figures on a monthly basis through September 2008 to track anticipated changes through the summer months.

NE Residential Solds Jan 2008 to June 2008

Santa Fe’s Historic Eastside Solds for 2008 show the average listing price at $539/sq.ft and average selling price at $493/sq.ft. with average listing price at $1.235M and average selling price at $1.1M with an average of 236 days on the market. Please keep in mind that these statistics are relating primarily to Santa Fe’s winter market which is not typically our strongest season for luxury home sales, particularly in the Eastside. Hence, I will be updating these figures on a monthly basis through September 2008 to track anticipated changes through the summer months.

NW of City Limits and Tesuque Sales Jan to June 2008

Now that all the troublesome real estate scenarios have been analyzed, we can begin to pick up the pieces. Granted, this has happened before, but just exactly when? The “oil bust” of the mid-1980’s had an interesting impact on Santa Fe real estate, but that was a regional event and inventory did not grow as fast as it has recently. Many are having difficulty remembering when things were so cloudy in economic terms. Property ownership as a safe haven can still be a good choice, but you must be willing to stay long enough to truly realize the gains that are possible. Home ownership has long term rewards that are both financial and non-financial, making it difficult to remove the emotion when buying and selling. The point would be to move deliberately rather than find you are in need of a quick fix with a stressful sale.

Santa Fe’s Historic Eastside Solds for 2008 show the average listing price at $539/sq.ft and average selling price at $493/sq.ft. with average listing price at $1.235M and average selling price at $1.1M with an average of 236 days on the market. Please keep in mind that these statistics are relating primarily to Santa Fe’s winter market which is not typically our strongest season for luxury home sales, particularly in the Eastside. Hence, I will be updating these figures on a monthly basis through September 2008 to track anticipated changes through the summer months.

Eastside Residential Solds Jan 2008 to June 2008

For your information and consideration, the link below will show current solds for the Las Campanas luxury market from 1-01-08 to 6-19-08.

Las Campanas Residential Solds for 2008 show the average listing price at $367/sq.ft and average selling price at $362/sq.ft. with average listing price at $1.5M and average selling price at $1.46M with an average of 295 days on the market. Please keep in mind that these statistics are relating primarily to Santa Fe’s winter market which is not typically our strongest season for luxury home sales in Santa Fe. Hence, I will be updating these figures on a monthly basis through September 2008 to track anticipated changes through the summer months.

Las Campanas Residential Solds Jan 2008 to June 2008