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Tuesday, March 31, 2015

Facing Limited Inventory, More Buyers Turn to New Construction

Market conditions in Dane County make new construction an attractive option.

Building a new home is a lifelong dream for most people, and current real estate market conditions in Dane County have made it a great time to take that step.

February ended with 20% fewer active listings in Dane County than in the previous year. That means buyers face fewer options and higher prices for pre-owned homes, the South Central Wisconsin MLS reports. 

That situation has made new construction an attractive, economical option for buyers who are unable to find a pre-home that meets all of their needs. Josh Lavik, a realtor with Keller Williams and the principal at Josh Lavik & Associates, recently saw that play out with one of his clients.

“For nearly the same price as a pre-owned home, my client was able to make his own selections and build new,” Josh Lavik said.

That trend has played out across the country, too. The rate of new home starts was 18.7% higher in January than in the previous year, the U.S. Department of Housing and Urban Development reports.

Still, even when market conditions make new construction a great option, many think the process is too complex or intimidating for them. Amy Kirner, a new home specialist at Veridan Homes, works to dispel that myth.

“Buying a new home has always been an option, but the stereotypical myth is that building or buying a new home is difficult, or loans are hard to acquire, or they cost more, or you don’t close on time,” Amy Kirner said. “But many are finding that this can truly be a great alternative, and many of these problems can be minimal or even non-existent with a little homework and finding the right builder. I have worked for Veridian Homes for over 11 years, and with over 60 years of experience building new homes, Veridian Homes has simplified the home buying/building process to turn those myths into a pleasant buying experience.”

Conventional financing, firm closing dates, and an array of options can make the purchase of a new home easy and more affordable than a pre-owned home, Amy Kirner added.

Mike Fujihira, a senior sales consultant with William Ryan Homes, said it’s important to consider different builders, and to understand allowances in a contract for upgrades like appliances, flooring, countertops and light fixtures.

“One thing with William Ryan Homes is that we're a 100% turn-key builder, and one thing that comes with that is that there are no allowances in your home,” Mike Fujihira said. “There are included features and materials, and then options to upgrade past that. We're able to get you through our design studio prior to the start of construction so you're able to determine your exact purchase price beforehand, and then there are no surprises of increased costs during construction.”

A trusted realtor can help determine how upgrades and added features will affect the saleability of a home in the future, too.

“Many times I'm able to make recommendations that will help down the road when they eventually resell the home,” Josh Lavik said. “I have seen many times people ‘build whatever they want’ in a custom home and don't really care about resale. Then they are shocked when they discover that the current market may not value the same things that they did when it was first built.”

Another major consideration is selling your current home on time. Again, a trusted realtor will help ensure a seamless process.

“I have two clients right now under contract that were worried about if their current home would sell so that they could buy their new (larger) home,” Josh Lavik said. “In both scenarios we were able to find a suitable buyer for their current home within 30 days on the market.”

The homebuilding process can take up to a year to complete. If new construction is in your plans, contact Josh Lavik & Associates at 608-620-4234 to learn how our client appreciation programs can simplify the process.

Tuesday, March 17, 2015

This Month in Real Estate - February 2015

The median sale price for homes, and the number of homes sold, were both up in February.

By Aaron Martin
Josh Lavik & Associates

The real estate market in the Madison area continues to heat up as winter turns to spring.

Demand from homebuyers is high, and inventory remains low. That created a great market for home sellers in Dane County in February. The number of homes sold, and the median sale price, both continued to trend upward.

The median sale price for homes across Dane County hit a record high for the month of February. It settled at $216,250, a 9% increase over the same period last year, the South Central Wisconsin MLS reported.

Motivated buyers and limited inventory could continue to drive higher sale prices in the months ahead.

“Based on numerous conversations with my clients, there seems to be a sense of urgency in the market to buy a home before the interest rates start to rise,” said Josh Lavik, a realtor with Keller Williams and the principal at Josh Lavik & Associates. “Nearly all mortgage lenders that I talk to are expecting interest rates to rise this year, they just don't know when. This is definitely making a market where home sellers’ have an advantage, often with multiple offers to choose from.”

Higher sale prices didn’t turn those motivated homebuyers away last month, either. The number of homes sold in Dane County reached a seven-year high for February. There were 346 home sales reported, up 5.5% from the year-over amount.

Overall economic conditions help explain homebuyers’ willingness to pay higher prices for homes. At the end of 2014, the U.S. unemployment rate was at its lowest level since 2008, and job growth was at its highest point since 1999. That means more people may be able to purchase homes. But overall wages dropped slightly in 2014, which could work against the housing market, according to a Keller Williams report.

Single-family homes accounted for the bulk of home sales in Dane County in February. There were 280 single-family homes sold and just 66 condos. Condo sales were down 19.5% from February 2014 due to limited inventory. Just 155 condos were listed for sale in February, one of the lowest levels we've seen over the last 12 years.

Overall, February ended with just 1,802 active listings in Dane County, a 20% drop from last year. A historical look at active listings at the end of February reveals just how limited inventory has become. In 2007, there were 5,128 active listings in Dane County at the end of February — that’s 65% more than we saw at the end of February 2015.

“If you are considering listing your home in the Madison area, then now might be a good time because it may be worth WAY more than you think,” Josh Lavik said.

New listings in Dane County were also lagging in February. Just 765 homes were listed for sale, a 7% drop from the year-over amount.

Similar real estate market patterns emerged across South Central Wisconsin in February. Median sale prices increased 10.5% from last year to $179,000 in the eight counties that make up South Central Wisconsin. The number of homes sold across those counties was up 4%, SCWMLS reports.

For information about current market conditions, or to discuss the right time for you to buy or sell a house, contact Josh Lavik & Associates at 608-620-4234.

Tuesday, March 3, 2015

Deciding When the Time is Right to Upsize Your Home

By Aaron Martin
Josh Lavik & Associates

It’s usually pretty clear when a family has outgrown their home. There may be telltale signs like a line to use the shower in the morning, an office space crammed into the corner of a bedroom, or arguments about what to watch on TV.

But it’s not as easy to decide when the time is right to upsize your home. First, you have to consider the needs of your family, both now and in the future. Then you have to monitor market conditions to ensure that you can afford everything your family needs in a new home, and to make sure you can get a good sale price on your current home.

In the 1960s, the median home size in the U.S. was 1,500 square feet. Today, the median size of homes has grown to 2,200 square feet, the American Housing Survey reports. The transition to larger homes reflects changes in family dynamics, work-home life balance, and other changing lifestyle patterns over the last 50 years. Simply put, smaller homes built in decades past may not fit the needs of today’s growing families.

What do larger homes offer that smaller homes may not? The most common amenities found in today’s larger homes include offices, laundry rooms, standalone dining rooms, large master bedrooms, multiple bathrooms and multiple living rooms, the National Association of Home Builders reports. Those amenities can make a big difference, too. For example, nearly 25% of adults report that they do some or all of their work at home, and a dedicated home office can help boost productivity. Multiple rooms for dining and entertainment make it easier to host family and friends. Laundry rooms and walk-in food pantries make everyday tasks more convenient. So, purchasing a larger home has plenty of benefits — but there may also be compromises to consider, too.

Moving into a larger home may mean that you have to settle for a smaller lot size and fewer neighborhood conveniences. Most of the larger homes on the market are newer, and the median lot size has shrunk by a quarter acre since the 1970s, the American Housing Survey reports. The survey also found that larger homes are often built on the outer edges of communities; so homeowners may have a longer commute to schools, childcare, work and retailers. Property tax and maintenance costs may also be higher in a larger home. And for years, higher energy costs were also considered one of the drawbacks of purchasing a larger home, but the rise of energy efficient appliances, sustainable light bulbs, and high-efficiency windows have helped offset that in recent years.

Of course, market conditions are also a significant factor. Home values in Greater Madison have steadily recovered over the last year. The monthly median sale price from February 2014 to January 2015 was $221,000 in Dane County, compared to $212,500 a year earlier, the South Central Wisconsin MLS reports. A reduced inventory of houses on the market has fueled those gaines. This type of balanced market benefits sellers and buyers alike. Sellers' homes receive increased visibility with fewer homes on the market, which may help homes sell at a higher price in less time. Buyers, meanwhile, can still build equity in a new home purchase because prices continue to trend upward.

The decision to upsize your home is a major life decision. Contact Josh Lavik & Associates at 608-620-4234 to discuss your options, and to help determine the best time for you to make the move.

Wednesday, February 25, 2015

This Month in Real Estate - January 2015

By: Aaron Martin
Josh Lavik & Associates

Home prices continued to edge upward over the last year in Greater Madison amid increased demand for homes and fewer listings in the area.

The South Central Wisconsin Multiple Listing Service (MLS) has released its first 2015 report on home sales in Dane County, and early indicators show that the area’s housing market will continue its steady rebound in the year ahead.

Demand for homes in Greater Madison remains high, and inventory remains low. There has been a steady decline in the number of homes listed for sale in Dane County over the last three years. The number of new listings in January was 7% lower than in 2014, and 14% lower than in 2013. Despite the continued drop in the number of new listings, however, the number of home sales hit a new eight-year high for January. There were 321 closings reported across Dane County. By end of January, there were 17% fewer active listings than in 2014, and 30% fewer active listings than in 2013, according to the report.

What does that mean for you? Demand for homes has outpaced supply in Madison and surrounding communities, and that has helped fuel a steady recovery in sale prices. The median sale price in January was $216,000, an eight-year high for that reporting period in Dane County. The median price for the month was also up 5% from 2013, which is a promising development for both sellers and buyers.

Higher sale prices mean sellers are able to rebuild equity in their homes. Single-family homes showed measured progress with a 1.8% increase in median sale prices from 2014. But the news for condo owners in Greater Madison was even better. The median condo sale price in January was $158,500, a new five-year high, and a 17% increase in the year-over amount, according to the report.

“I'm not surprised to see the large increase in condo prices since condos also had the biggest decline between 2007 and 2009,” said Josh Lavik, a realtor with Keller Williams and the principal of Josh Lavik & Associates. “This is good news for condo owners that lost a lot of equity in previous years.”

Early indicators for 2015 hold promise for potential homebuyers, too. The year began with historically low interest rates holding firm, which makes home loans more affordable. Also, the steady recovery in sale prices means homebuyers can build equity and haven’t “missed out” on an opportunity to buy while prices are trending upward. Still, there are fewer homes on the market than in recent years, and those historically low interest rates won't hold for long.

“Watch for interest rates to rise in the coming year,” Josh Lavik said. “I think that when this happens, there will likely be a flurry of sales activity of people trying to take advantage of the lower rates anticipating that they will likely go higher.”

High demand for homes and fewer new listings has also driven steady recovery in sale prices across Wisconsin. Median sale prices statewide reached $135,000 in January, a 6.1% increase from January of 2014, the Wisconsin Realtors’ Association reports. The number of home sales across the state in January, however, marked a new three-year low for the month.

For information about current market conditions, or to discuss the right time for you to buy or sell a house, contact Josh Lavik & Associates at 608-620-4234

Tuesday, December 16, 2014

Looking for a career in real estate? We are hiring!

Josh Lavik and his team at Keller Williams Realty is looking to grow!

We are currently accepting applications for an Executive Assistant and Transaction Coordinator to manage office operations and serve as transaction coordinator for a high volume of real estate contracts.

Primary Objectives
- Build, Implement, and manage all systems for sellers, buyers, lead generation, database management, information management, and back-office support
- Oversee all contracts through closing
- Maintain the operations manual that documents all systems and standards
- Coordinate the purchase, installation, and maintenance of all office equipment
- Be the first point of contact in handling customer inquiries or complaints
- Keep the lead agent informed regarding any problems or issues that need to be handled
- Responsible for hiring, training, consulting, and holding accountable all additional administrative team members

Regular Work Activities
- System development, Implementation, and Management
- Information management
- Oversight of contracts through closing
- Customer/ vendor relations
- Basic bookkeeping

Key Skills
- Strong written and verbal communication skills
- Exceptional organizational and project management abilities
- Bookkeeping skills
- Great ability to focus 
- Concerned about doing things the right way
- Calm under pressure
- Learning based
- Service-based attitude
- Proven ability to succeed

Experience, Training, and Education
- Bachelor's degree preferred with 1-3 years of administrative experience
- Ability to obtain a Wisconsin Real Estate License

Interested?  Submit your resume and coverletter to us