market conditions: Finding Yourself In A Multiple-Offer Situation? You're Not Alone. And Here's Why. - 04/24/09 03:05 AM
The days of rock-bottom housing prices may be reaching an end.
According to the National Association of REALTORS, the number of Existing Home Sales fell by a modest 140,000 units last month. It's the fifth straight month in which home sales straddled the 4.5 million mark.
The national housing inventory is down 900,000 from its July 2008 peak.
These are two encouraging signs.
Meanwhile, in a separate report, the Commerce Department said the supply of newly-built homes for sale is at a 7-year low.  This, too, is a positive signal for housing.
Home values are based on supply and demand.  If the … (1 comments)

market conditions: Don't Lump Your Real Estate Research With The 128,203,000 Other Homes In America - 04/22/09 04:13 AM
National real estate data helps economists identify trends in the housing market. It shapes policy and influences markets.
For active home buyers and home sellers, though, national real estate data is irrevelant.  This is because national data says nothing for the factors determining home prices in any given zip code.
See, national real estate news is mash-up of data.  It's 128,203,000 homes from all 50 states.  Each of these states has its own economy and there are different factors that drive home values in each
Most Americans understand this.
But, if we dig deeper, we see that within those states, there are more than 19,000 incorporated … (0 comments)

market conditions: Another Positive Housing Signal : The Number Of Homes Under Contract Increase - 04/02/09 02:19 AM
The number of homes under contract to sell is rising, another signal that the housing market may be regaining its footing.
As reported by an industry trade group, the Pending Home Sales Index gained 2 percent in February.  The report measures MLS-listed homes in "pending" status -- sold but not yet closed.
Pending Home Sales is not a perfect statistic, though, by any means. 
For one, the Pending Home Sales Index doesn't account for non-MLS listed homes including For Sale By Owner properties and mass foreclosure auctions.  In certain markets nationwide, these two categories represent a large percentage of the overall transaction volume.
Secondly, Pending … (1 comments)

market conditions: Are Home Values Rising Or Falling? The Answer Depends On Who You Ask. - 04/01/09 03:31 AM
A report published Tuesday showed that home values fell nearly 3 percent in January 2009 versus the month prior and by 19 percent from last year.
On the surface, data from the study looks like more bad news for housing.  With deeper inspection, though, we uncover reasons to discount the report's finding.
For one, the report includes home price data from just 20 cities around the country -- and they're not the 20 most populated cities, either. 
For example, data from #4-ranked Houston is not included and neither is #7 San Antonio nor #10 San Jose. #54 Tampa, however, is included.
Secondly, the … (0 comments)

market conditions: More Signs Of A Bottom : New Home Sales Unexpectedly Rise - 03/26/09 02:21 AM
The national housing market got its third piece of good news in 3 days:
Monday: Existing Home Sales up Tuesday: Home values appear higher nationally Wednesday: New Home Sales up And although national real estate statistics are irrelevant to the local markets in which real estate transactions happen, to a country of would-be and wanna-be home buyers, repeated positive news on housing can be a strong signal that it's time to get off the sidelines.
At least, that's what the data is showing us.  According to an industry trade group, first-time home buyers accounted for half of all sales of previously-owned homes.  … (1 comments)

market conditions: Watch Out For Mortgage Rates When Gas Prices Rise - 03/25/09 03:54 AM
Don't look now but oil prices are climbing.
This should worry today's home buyers and would-be refinancers because some of the same forces that helped to push crude past $50 for the first time in 4 months also cause mortgage rates to rise.
March 18, the Federal Reserve committed an additional $1.15 trillion to support the economy. 
Since the announcement, investors have questioned whether the Fed is purposefully spurring inflation.  The Fed's total debt purchases now total $1.75 trillion.
And to finance its purchases, the Federal Reserve is printing new money, devaluing the U.S. dollar along the way.  This then leads to … (0 comments)

market conditions: History As A Teacher: What To Do When Mortgage Rates Plummet - 03/20/09 03:26 AM
For the fifth time in a year, rate shoppers learned an important lesson this week: When mortgage rates plummet unexpectedly, they often recover just as fast.
Wednesday, the Federal Reserve's newest $750 billion mortgage market pledge helped to push conforming mortgage rates near their lowest levels since WWII. 
24 hours later, however, those rates were expired.
After considering the long-term implications of the Federal Reserve -- literally -- printing new money to service the recession, markets grew fearful that the Fed's interventions will eventually lead to inflation.  Inflation, of course, is the enemy of mortgage rates.
So, if you're looking for … (1 comments)

market conditions: Explaining What The Federal Reserve Did In Plain English (March 18, 2009 Edition) - 03/18/09 12:27 PM

The Federal Open Market Committee voted to leave the Fed Funds Rate unchanged today, within the target range of 0.000-0.250 percent.  This doesn't mean the Fed stood pat, however.
On plan to resurrect the economy using "all available tools", today, the Fed announced a new, $1.5 trillion round of fiscal support for the treasury and mortgage markets.
The stimulus will likely be Thursday morning's headline story.
In its press release, the FOMC touched upon a few of the prevailing economic issues, using these points as a legitimizing backdrop for its newest debt load:
Job losses and wealth loss are dragging … (0 comments)

market conditions: Today's Signal That Home Prices May Have Already Bottomed: Building Permits - 03/18/09 12:40 AM
There's a mixed message in February's Housing Starts data and it may be a good sign for home sellers in the near-term.
As reported by the government, new home construction rose by 22 percent last month.  The press is running with the headline number, calling it evidence of a market bottom.
A more thorough inspection, however, reveals a different story. 
The 22 percent figure applies to all homes built -- including apartment building units.  Isolating residential units, February's housing starts rose by just 1 percent.  Furthermore, the data's margin of error is 11 percent. 
Statistically, we can't know if residential … (0 comments)

market conditions: The Federal Reserve Is Meeting And What It Means To Your Mortgage Rate - 03/17/09 08:33 AM
The Federal Open Market Committee begins a scheduled, 2-day meeting today to discuss the country's monetary policy.  As is custom, the group will issue a press release to the markets upon adjournment.
There are 8 scheduled FOMC get-togethers annually and the post-meeting press releases are among the most powerful market-moving events of the year.
It's not the Fed's actual policy changes that causes fortunes to be won or lost, though.
These changes can predicted and traded -- and, therefore, hedged -- on Wall Street using Fed Funds Rate Futures.  For example, Wall Street predicts with 97% certainty that the Federal Reserve will … (0 comments)

market conditions: Homes Listed For Sale Plummet Across 96% Of Major U.S. Markets - 03/06/09 02:11 AM
If you asked an economist why home prices have broadly fallen over the past 2 years, you'd get a short lesson in Supply and Demand.
Too many homes for sale and not enough people to buy them pushed values lower until a balance point can be reached.
Looking at the chart at right, that balance point may be fast approaching.
According to data compiled by ZipRealty, the total number of homes listed for sale fell in February 2009 in 23 of 24 major housing markets. 
This is an especially important data point because home inventories typically rise in February, ahead of … (0 comments)

market conditions: More Good News For Home Buyers : Mortgage Guidelines Ease Up - 02/03/09 02:14 AM
If the unfreezing of credit is paramount to an economic rebound, the first signs of a thaw may be here.
Monday, the Federal Reserve released its quarterly survey of 84 member banks.  In it, the Fed says that fewer than half of its responding banks tightened "prime" mortgage guidelines over the last 3 months.
This is good news for active home buyers and other Americans in want of a new mortgage.
"Prime" is a vague term with respect to home loans, but it usually refers to mortgage applicants who can document:
Equity or downpayment in a home  Credit scores over 740 Excessive income versus … (0 comments)

market conditions: Sell Your Home For 40% More, 17% Faster This Spring - 01/30/09 02:37 AM
Super Bowl Weekend traditionally marks the start of the Spring Buying Season in real estate.  Anecdotally, real estate agents will tell you that buyer activity tends to tick higher at this time of the year.
Meanwhile, with mortgage rates still trolling near all-time lows and Congress debating a first-time homebuyer tax credit, 2009 may bring out even more buyers than we've seen in the past.
Just having your home on the market may not be enough to attract an offer, though -- the home has to have appeal.  That brings us to home staging -- the process by which a homeowner … (0 comments)

market conditions: Explaining What The Federal Reserve Did In Plain English (January 28, 2009 Edition) - 01/28/09 02:27 PM

The Federal Open Market Committee voted to leave the Fed Funds Rate unchanged today.  It remains within a target range of 0.000-0.250 percent.
In its press release, the FOMC reiterated most of the key points from its December 2008 statement, including:
The U.S. employment outlook continues to deteriorate Consumers and businesses continue to cut spending The housing sector is still showing weakness In addition, the FOMC addressed the "extremely tight" credit conditions for U.S. households and business, even as it said some financial markets are showing signs of improvement. 
To the Fed, the latter is a precursor for the … (0 comments)

market conditions: Did We Just See The First 2 Signs Of A Housing Recovery? - 01/27/09 05:27 AM
Don't let the plunging median sales price fool you -- December's Existing Home Sales data has home sellers smiling. 
Just one month after falling below the 5-million unit trend line, sales volume roared back by 300,000 homes in December, surprising housing analysts and making a case that this spring's Buying Season could be a competitive one.
Falling home prices helped fuel home sales.  Nationally, the median sales price -- the point at which half of all homes sold for more and half sold for less -- was $175,400, down $32,000 from last year.
However, the most important part of December's … (0 comments)