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National Assoc. of Realtors Article on Bailout Plan

October 7th, 2008 7:32 AM

Daily Real Estate News | October 6, 2008Rescue Bill Not Perfect, But Still Best Solution

On Friday, the U.S. House of Representatives joined the Senate in passing the Emergency Economic Stabilization Act of 2008 — and President Bush quickly signed the bill into law.

In a letter to members of the NATIONAL ASSOCIATION OF REALTORS®, NAR President Dick Gaylord thanks everyone who voiced support for the revised bill. A failure to act, he said, "Would have pushed consumers into more dire circumstances."

Gaylord acknowledged that many REALTORS® were torn over whether or not to support the bill. "We realize this bill is not perfect," he said. "However, we believe the additions made by the Senate, including raising the FDIC insurance limit and several other measures that will benefit and protect taxpayers, make it a more favorable solution than the previous proposal."

NAR will continue to work with Congress and the Bush Administration to make sure the measures included in this bill are implemented quickly, "with the needs of Main Street placed front and center," Gaylord said.

Real estate experts say the bill will give the market a much-needed boost, but that substantial recovery of credit markets will probably take time.

"The market should regain some confidence, and since markets are built mainly on confidence, that’s no small thing," says Gary Keller, head of national residential real estate franchisor Keller Williams in Austin, Texas. "In fact it’s a huge thing and it’s imperative for the market to move forward. But beyond that, we have to wait and see."

"It should give calmness to the financial markets by showing that we will in fact work through this crisis," said Kenneth Riggs, head of commercial real estate analysis firm Real Estate Research Corp., Chicago. "That said, I don’t see the fundamental, or the mechanics, of capital changing right away. That won’t happen until we see how this package will actually operate."

To read more on what Keller and Riggs have to say about the legislation and the future of the real estate market, visit REALTOR® Magazine's blog, Speaking of Real Estate (REALTOR.org/speakingofrealestate).

Source: REALTOR® Magazine

Posted by Mark Trafton on October 7th, 2008 7:32 AMPost a Comment (0)

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Good News!!! Sales are UP!!!!!

October 27th, 2008 3:07 PM

NAR: Home Sales Rise as Affordability Improves

Existing-home sales increased last month as buyers responded to improved housing affordability conditions, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 5.5 percent to a seasonally adjusted annual rate of 5.18 million units in September from a level of 4.91 million in August. Home sales are 1.4 percent higher than the 5.11 million-unit pace in September 2007.

Lawrence Yun, NAR chief economist, said more markets are seeing year-over-year gains.

“The sales turnaround which began in California several months ago is broadening now to Colorado, Kansas, Minnesota, Missouri, and Rhode Island,” he says. “The South was hampered by much lower home sales in Houston in the aftermath of Hurricane Ike.”

NAR President Richard F. Gaylord says low home prices and low interest rates have helped attract buyers.

“This is the first time since November 2005 that home sales have been above year-ago levels,” Gaylord says. “Credit tightened at the end of September, but the improvement demonstrates that buyers who’ve been on the sidelines want to get into the market to make a long-term investment in their future.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 6.04 percent in September from 6.48 percent in August; the rate was 6.38 percent in September 2007.

Yun says there may still be market disruptions.

“The credit markets are not settled yet, although the mortgage market stabilized with the government takeover of Fannie Mae and Freddie Mac," Yun says. "Inventory remains high, and price declines are pressuring owners."

Yun says that an additional housing stimulus would stabilize prices more quickly and help bring faster stability to Wall Street.

"Removing the repayment feature on the [$7,500] first-time buyer tax credit and permanently raising loan limits would bring more buyers into the market and further reduce inventory,” Yun says.

A Closer Look at the Numbers

Total housing inventory: at the end of September fell 1.6 percent to 4.27 million existing homes available for sale, which represents a 9.9-month supply at the current sales pace, down from a 10.6-month supply in August. This marks two consecutive monthly declines since inventories peaked in July.

National median existing-home price: $191,600 in September, for all housing types. That's down 9 percent from a year ago when the median was $210,500.

“Compared to a fairly small share of foreclosures or short sales a year ago, distressed sales are currently 35 to 40 percent of transactions," Yun says. "These are pulling the median price down because many are being sold at discounted prices. The current market is not being dominated by speculative investors. Rather, 80 percent of current buyers are purchasing a primary residence, which is a bit higher than historic norms.”

Single-family home sales: increased 6.2 percent to a seasonally adjusted annual rate of 4.62 million in September from a pace of 4.35 million in August, and are 3.8 percent above the 4.45 million-unit level a year ago. The median existing single-family home price was $190,600 in September, which is 8.6 percent below September 2007.

Existing condominium and co-op sales: were unchanged at a seasonally adjusted annual rate of 560,000 units in September, but are 15.7 percent below the 664,000-unit pace in September 2007. The median existing condo price was $199,400 in September, down 10.2 percent from a year ago.

By Region

Here's a breakdown across the country of existing-home in September:

West: sting-home sales in the West jumped 16.8 percent to an annual rate of 1.25 million in September, and are 34.4 percent higher than September 2007. Median price: $253,600, down 18.5 percent from a year ago.

Midwest: sales increased 4.4 percent to an annual pace of 1.19 million in September, but are 2.5 percent below a year ago. Median price: $152,500, which is 7.9 percent lower than September 2007.

South: sales rose 2.2 percent in September to a pace of 1.9 million but remain 7.8 percent below September 2007. Median price:$167,200, down 4.1 percent from a year ago.

Northeast: sales slipped 1.2 percent to an annual pace of 840,000 in September, and are 7.7 percent lower than a year ago. Median price: $246,800, down 5.4 percent from September 2007.

Source: NAR (National Association of Realtors)

We've noticed an uptick of pending sales for the month of November in our office. So far, our office is looking to close 50% more homes in November than it will in October or than it did in September--very encouraging considering all of the economic news we've received the past several weeks!

Posted by Mark Trafton on October 27th, 2008 3:07 PMPost a Comment (0)

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