Trenton is experiencing the most short sales and also the greatest effect at over one third of the sales being “short”. While Ewing and Hamilton have the next most short sales, the effect is greater in Hightstown and Hopewell Borough because of the limited amount of total sales.

Yes, Virginia, all real estate is local.

The previous post about “normal” vs. “short sale” transactions also allowed me to analyze where in Mercer County the short sales were occuring.

About 85% of the short sales are occuring in just 3 of our thirteen local townships, with about half of them taking place in Trenton. Add Ewing and Hamilton to the mix and the rest of the county have seen significantly less activity in this realm.

Yes, Virginia, not all the national news applies to every location. It truly is location, location, location.

While analyzing the sales data for types of mortgages (see below), I realized that the short sale information was staring me in the face, so I decided to see just how many short sales there were in our local Mercer County market.

While the national press keeps telling us just how bad things are, the data for our local area may suprise you as we had only 8% short sales. Add to that the 6% of sales that were of bank owned (read foreclosure), that leaves 86% of the sales to be what we would consider “normal”.

Yes, Virginia, there is some normal real estate activity taking place.

After a long discussion about how people are able to buy a home in the current climate, I undertook a project to look at how individuals are financing their purchases. The chart below is a compilation of the past six months of home purchases in Mercer County, New Jersey. There were 1385 homes sold according to our local Multiple Listing Service, TReND.

Approximately 75% of the purchases were made by means other than cash. Not all conventional loans are 20% down, so somewhere between 25% and 75% of the home purchases were made with less than 20% down (at least 25% were at 3.5% down or less, as that is the least percentage down that FHA allows).

So yes, Virginia, people are getting mortgages with less than 20% down.

That is a total of 2544 sales (1.52 per member) or a total sales amount of $862,164,144. This should result in total commissions of about $47,419,027.92.

With there being two members working on each transaction, each member would receive an average $14,248.50 in commissions for the year, which is generally split between the member and the company they have their license with. Assuming 52 weeks per year — 5 days per week — 8 hours per day, for a total of 2080 hours per year, that works out to $3.43 per hour. And then you have to take out the 15% for social security taxes, your multiple listing, membership and license fees, your Errors and Omissions insurance, car expenses, etc.

Even if you assume the agent is only working while the listing(s) are on the market (89 days x 1.52 listings), that is still 1082 hours or $6.58 per hour, before expenses.

The federal minimum wage is set to rise to $7.25 per hour effective July 24, 2009.

It would appear that we need either higher commissions, more sold houses, or fewer agents in order to meet the requirement of the Federal Minimum Wage.

Websites ranked in order of performance

This trend has proven resilient over time. Google and Yahoo know that the Weidel page exists but it does not rank very high in their rank of importance.