Have we hit a bottom?
Buyers who have been sitting on the fence waiting for interest rates to drop, home values to decrease or additional inventory to come to market due to lack of "The Perfect Home" may want to get some gas in their tanks and get motivated. Inventories are continue to decline, prices in the $100K-$225K price range has stabilized and most important of all, the $8,000 tax credit expires 11/31/09.
What does this mean?
If buyers continue to wait for prices to drop marginally, and rates even go up .50 percent, all value you would receive with the price drop would be lost with the increase in the interest rate. The tax credit of $8,00 dollars expires and there is already great competition for the existing homes specifically foreclosure properties. Buyers need to act now or be left saying "If I would have bought when". Call or e-mail me and let's meet to discuss your needs and the current market conditions.
Cell: 612-581-5375
E-mail: Eric@EricHelmers.com
Info-Second Quarter Existing-Home Sales Rise
Existing-home sales in the second quarter showed healthy gains from the first quarter in the vast majority of states, and price declines have increased affordability in most metro areas, according to the latest surveyby the NATIONAL ASSOCIATION OF REALTORS®.
Total state existing-home sales, including single-family and condo properties, rose 3.8 percent to a seasonally adjusted annual rate of 4.76 million units in the second quarter from 4.58 million units in the first quarter. However, they remain 2.9 percent below the 4.90 million-unit pace in the second quarter of 2008.
Thirty-nine states experienced sales increases from the first quarter, and nine states were higher than a year ago; the District of Columbia showed both quarterly and annual rises.
NAR: Gain Appears to Be Sustainable
"With low interest rates, lower home prices, and a first-time buyer tax credit, we've been seeing healthy increases in home sales, which are a hopeful sign for the economy," says Lawrence Yun, NAR chief economist. "There have been sustained sales gains in Arizona, Nevada, and Florida, as well as diverse areas such as Maryland, the District of Columbia, and Nebraska. More recently, we've seen strong double-digit gains in Idaho, Utah, New Mexico, Washington, Hawaii, New York, New Jersey, Maine, Vermont, Wisconsin, Indiana, South Dakota, and Montana."
Yun also explained housing's impact on the overall economy.
"Given the need for related goods and services, each home sale pumps an additional $63,000 into the economy - that's how the housing engine traditionally pulls us out of recession. In addition, sales are drawing down inventory and that will help stabilize home values, which in turn will lessen foreclosure pressure and boost credit availability for other sectors of the economy."
Distressed Sales
During the second quarter, 129 out of 155 metropolitan statistical areas reported lower median existing single-family home prices in comparison with the second quarter of 2008, while 26 areas had price gains.
Distressed sales - foreclosures and short sales - accounted for 36 percent of transactions in the second quarter, which continued to weigh down median home prices because they typically are sold at a 15 to 20 percent discount; first-time buyers accounted for one-third of transactions.
The national median existing single-family price was $174,100, which is 15.6 percent below the second quarter of 2008.
According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage declined to a record low 5.03 percent in the second quarter from 5.06 percent in the first quarter; the rate was 6.09 percent in the second quarter of 2008.
NAR President Charles McMillan said there are unique opportunities in the current market.
"Housing affordability is hovering near record highs and there's a wide selection of homes, but first-time buyers need to move quickly to take advantage of the $8,000 tax credit because they have to finalize the transaction by November 30," he says. "Various state, local, and nonprofit programs target first-time buyers, and a REALTOR® can help you identify the programs and financing options that are currently available in your area."
Source- NAR
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