Fritz Pfister

The trends in the local housing market are proving once again the resiliency of the Springfield area. Local Realtors posted the best week of the year with 111 home listings going under contract. Closed sales are still running behind last year to date however the margin is shrinking to single digits. More foreclosed homes have closed and are removed from the supply. The number of new listings continues to trend downward, declining 11.6% compared to last year. Good news all as the market appears to be trending away from a heavy supply that has depressed the market.

It appears March home sales will surpass March of 2008.  In both closed home sales and in sale price. Hopefully this is the beginning of an upward trend for local home sellers. However, we need to be cautious, one month does not establish a trend.

As shared with you here, since the beginning of the year, with interest rates declining to the lowest on record paired with pent up demand from the housing market decline the second half of 2008 through February of 2009, that the March through May spring market could be the best of the year. The federal tax credit of up to $8,000 being offered to first time home buyers is helping add to the demand for homes.

This is a golden window of opportunity for local homeowners that want to sell their homes. In my opinion the market should remain strong through at least May, and probably into June. The jury is out after June. Those that wait until the second half of the year are taking a chance. My advice would be to get to the market ASAR.

What is ASAR? As soon as ready. One of the biggest mistakes home owners make is rushing to the market before they are ready. These folks risk blowing their golden opportunity by making this mistake. On Thursday April 16 I will be hosting my final home seller seminar for 2009. If you want to eliminate the most common mistakes home sellers make that cost them a sale, you should attend this seminar. You can register by calling 652-7653 or online at SpringfieldHome.com.

Why may this be a short window of opportunity? First; interest rates are artificially low and not market driven as a result of the Federal Reserve pumping 1.3 trillion dollars into treasuries. The impact will wear off and rates will go up. Second; where will more buyers come from if our job market becomes flat or declines? Unemployment in Illinois is now up to 8.6%. Third; the threats to the economy by the government through regulation, deficit spending, and taxation.

Next week congress is expected to vote on the most massive budget in the history of our nation, which will result in trillion dollar a year deficits over the next ten years according to the Congressional Budget Office (CBO). The Administration projects those deficits will only be 500 billion dollars annually by 2012. Either way it’s deficit spending that will have to be repaid which in my opinion will lead to more tax increases upon businesses and families.

That’s money going to Washington D.C. to be spent on the largest expansion of government in our history. Estimates range from 110,000 to 250,000 new federal jobs in bloated bureaucracies that will need even more funding to maintain in the years to come. If the CBO is correct the debt service will cost the American people 832 billion dollars a year in interest only by 2019. This transfer of wealth from the private sector to government will have a dire impact upon the economy including the housing market.

It appears the Obama administration believes we can spend and tax our way to prosperity. The proposed tax increases on the wealthy will not cover the bill and economists say to repay this debt if the budget is passed, taxes will have to be increased on everyone earning $75,000 or more a year. This doesn’t take into consideration the massive tax increases proposed in Governor Quinn’s budget.

When people’s money is confiscated through taxation and sent to any government, then that’s just that much less money they have to spend on goods and services. This could further erode consumer confidence, and add to the vicious cycle caused by a pull back in consumer spending. Less spending means less demand for goods, which in turn leads to more job losses.

Thanks to C.F. Marley for his letter in the SJR Friday quoting Winston Churchill who said; “For a nation to try to tax itself to prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”

We’ll have to wait and see what congress does with the budget. In all probability it will pass without any checks and balances due to one party control. If this budget passes, two things will surely follow on down the road, inflation and higher taxes. Both of which will directly impact the value of your home, the ability to sell your home, and the ability to buy a home.

Today you have a golden opportunity to get your home sold. The market is performing at its best level in over nine months. The window of opportunity may close before you know it. Now is the time to take action if you want to sell your home, however be mindful that making mistakes will cost you your golden opportunity.

Register today for the free home seller seminar, learn the process, learn the actions you should take, and learn from the mistakes of others so you don’t repeat them. Call 652-7653 or register online at SpringfieldHome.com. The seminar will be Thursday April 16, beginning at 6pm at the CAAR building at 3149 Robbins Road, Springfield.

The opinions expressed are solely those of Fritz Pfister, and not RE/MAX Professionals of Springfield or RE/MAX International.