This Month in Real Estate ............................................................................................................................................... Market Update The housing market continues its slow recovery without the aid of the now expired tax credit. Sales are slower but growing, and prices remain on par with last year's levels. Interest rates also hit a new historic low, a major factor in helping keep mortgage payments low, which is expected to spur sales. The economy shone a bit brighter in September. It grew faster during the second quarter than expected, and companies continued to hire. Experts believe there is now less risk of a double-dip recession. Now, the Federal Reserve Board's challenge is not if the economy will grow but how fast. Experts anticipate both the economy and the housing market will continue their path on the way to a complete recovery. This march back up provides excellent opportunities: an ample selection of homes, affordable prices, and historically low interest rates.
Home sales began to rebound in August. This increase follows a large drop caused by the expiration of the Federal tax credit in July. Sales are expected to slowly rebound as the market finds its footing without leaning on the government for support. First-time buyers fell from 38% to 31% in August from July. Over the same time period, investors rose from 19% to 21%,
Overall home prices fell slightly in August compared to July, but major markets appear to be bucking trend as the Case-Shiller Index shows an increase of 3.2%. Distressed properties accounted for a slightly larger proportion of sales in August compared to July. The discount in distressed properties helps explain the slight decline in August prices. Total inventory came back below 4 million to 3.98 million in August, representing 11.6 months of inventory. While still at a relatively high level, months of inventory dropped by nearly a month in August from the 12.5 month's supply in July. Housing remains highly affordable, and prospective home buyers stand to benefit from the lowest mortgage rates in decades, as well as advantageous home prices. The ratio now stands at 14.9%, growing closer to the record of 13.6%. Source: National Association of Realtors Interest Rates Mortgage rates once again set new record lows in early September and remained below 4.4% throughout the month. As economic activity gains momentum, rates will rise to keep inflation at an acceptable level.
Rates as of September 30
This Month's Video
Topics For Home Owners, Buyers & Sellers
Bonus For BuyersFor Owner Occupants that Buy Fannie Mae Foreclosures
Like a car dealership at the end of its model year, Fannie Mae is offering special incentives exclusively for owner occupants that purchase property from its sizable inventory of foreclosures, also known as HomePath properties. Owner occupants that purchase a Fannie Mae HomePath property by December 31 will receive up to 3.5% toward closing costs and a home warranty. These incentives for foreclosures are unheard of - banks typically sell foreclosures "as-is" without incentives, warranties, or repairs. This could help buyers to view a HomePath property more like a traditional sale, not a foreclosure, during their search process. Owners and investors can purchase HomePath properties for 3% down and no mortgage insurance. For homes that are not in tip-top shape, Fannie Mae also offers the HomePath Renovation financing, which works similarly to FHA's 203(k) mortgage by allowing the cost of light renovation to be included in the mortgage. Furthermore, owner occupants get a 15-day "first dibs" on HomePath properties through the First Look program. Fannie Mae is also offering agents an additional $1500 for representing owner occupants who purchase these properties, helping to compensate them for the extra paperwork and other potential obstacles that come along with foreclosure transactions. Buyers should be sure to take a second look at Fannie Mae's HomePath properties before settling on "the one." It could mean not just a great deal but an excellent one. To see Fannie Mae's HomePath homes, check out HomePath.com
Options for Investors
Not only is it the perfect time to buy a home, but it's also an excellent time to purchase an investment property. If you already own and are not interested in moving - or you can't because of the 3-year occupancy requirement to keep your home buyer tax credit - but still want to take advantage of the market, investing can be a great way to do so. In the current lending situation, lenders often require investor buyers to have six months reserves of mortgage payments and a 25% down payment. This stipulation keeps many would-be investors out of the market. Here are some little known tips to help investors purchase, regardless of the tighter lending environment:
Sources: The Wall Street Journal, Inman News, KW Research |
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Dagny's Real Estate - Wilton, CT
Fairfield County CT, CDPE Homes For Sale and Condo
United Country Ponderosa Realty, Red Feather Lakes, Colorado - Red Feather Lakes, CO
REALTOR, Red Feather Lakes, Colorado
Olympus Executive Realty INC. - Orlando, FL
Home Of The Top Producers
Debra, Thank you for the great wealth of information and update on your area, Great work! Wishing you the best!
Love your Rainbird listings!
Oct 14, 2010 02:01 PM
Red Rock Real Estate (435) 632-9374 - St. George, UT
St. George Utah Area Residential Sales Agent
This is a fantastic market report Debra and Fannie Mae is offering some amazing incentives for buyers!
Oct 14, 2010 02:35 PM
Assoc. Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, Broker/Providence Property Mgmnt, LLC Huntsville AL - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource
Debra, take a breath and come up for air!!! Lots of good info here...over all things are improving or were until this foreclosure freeze. That aside I think this spring is going to be a up beat. Many of us seem to be very busy now so I'm optimistic. Great job!
Oct 14, 2010 03:06 PM
LoKation Real Estate - Boca Raton, FL
Boca Raton FL (561) 716-7824
Deb, Nice informative post! Very well done. Explaining about Fannie Mae will be a big help to buyers in your area.
Oct 20, 2010 03:29 PM
SHAHAR Management - Middletown, NY
Hudson Valley NY Real Estate 845.283-3036
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