A stabilization for housing?
Higher sales a ray of hope among foreclosures, unemployment
By Dian Hymer, Tuesday, October 6, 2009.Pending sales of resale homes grew 6.4 percent from July to August, hitting the highest level in about two years, the National Association of Realtors reported -- it was the seventh straight month of increase for the group's pending sales index.
Pending sales are sales where an offer has been accepted but the sale has not yet closed. Even though some pending sales never close, pending sales are an indicator of current buyer activity. This increase can be attributed to low interest rates, a pickup in foreclosure sales, and improved affordability.
The Associated Press Economic Stress Index indicated that foreclosures stabilized in June in the three states hardest hit by the housing downturn: Florida, Nevada and California. The California Association of Realtors reported that the statewide median home price for resale homes rose for the sixth month in a row in August, with sales dropping 5.1 percent from July to August but up 9 percent compared to August 2008.
HOUSE HUNTING TIP: The increase in home sales may be in part due to the $8,000 tax credit available to first-time buyers who qualify. To use this credit, a home purchase must close by Nov. 30, 2009. Some experts think the market may slow again when this credit expires. It's possible the credit may be extended.
Other good news suggests that the recession might be winding down. The Federal Reserve's "Beige Book" for June noted that business spending had picked up, although not dramatically. The threat of inflation appears to be on hold. Manufacturing is picking up in some areas and decreasing less dramatically in others. The housing market improved in some areas.
For example, DataQuick, a real estate research company, reported that the median price in the San Francisco Bay Area rose 13.4 percent in July compared to the previous month. The median price was 15.8 percent below a year ago. But the number of distressed sales dropped in July while the number of higher-priced home sales rose.
The number of homes sold for the month of July was 17.9 percent higher than a year ago. In August, the sales volume and median price for the area declined. It's impossible to know if this is a blip or the beginning of a trend. ...CONTINUED
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Submitted by Tom Scaglione on October 6, 2009 - 4:39am.
It is amazing to me how everyone is ignoring the fact that there is a moratorium on the release of REO properties to try to stabilize the housing market... but, when the 1.5 million in the USA are released the home prices will continue to drop and when the over 4.0 million that are yet to have been foreclosed on hit we will see another drop in prices.
Those of us specializing in REO properties have seen our inventory shrink since June of 09 and keep getting word that REO's will be released into the market soon. The FED is only postponing the inevitable.
Tom Scaglione, e-PRO, REALTOR
Future Home Realty, Inc.
Tampa Bay Area, Florida
Certified Bank Owned Specialist
Submitted by John Rakoci on October 6, 2009 - 5:54am.
There will be no stabilization without jobs. Unemployment is at the highest levell in 267 years and growing. Even people with jobs are not buying in fear their job may be next.
The $8K tax credit needs to die as scheduled. Those that cannot afford the homes without the credit will soon lose them and have wasted tax dollars. Most others simply bought 1 - 5 years early. Nothing gained except additional debt for us, our children, and grandchildren. Every time any market is manipulated the negative impact down the road outweighs the temporary benefit.
Jobs is the key. Jobs that go away will not be replaced until the economy is well into growth mode again. The few that are being replaced are at lower wages.
Like all that 'hope & change' the stimulus is not working. Programs like 'cap & trade' and obama-care will only make things worse. The economy will recover inspite of the current policies and programs but the cost gets higher daily.
Submitted by John Rakoci on October 6, 2009 - 5:55am.
Whoops- that is 27 years---
Submitted by Jon Astaris on October 6, 2009 - 8:59am.
During the bubble frenzy of 'o4-07, it was "Everybody's getting rich but you! BUY BUY BUY!"
Now it's "Market is stabilizing, recovery is here, statistics say, (insert many numbers and experts) but the conclusion isstill BUY BUY BUY!"
Most of those who "bought" and "buy" will lose money. The market has a long way to go. Down.