Housing Markets

Pending Home Sales Continue to Rise

Pending home sales rose again, marking eight consecutive monthly gains – the longest streak since measurement began in 2001, according to the National Association of REALTORS®.

The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in September, rose 6.1 percent to 110.1 from a reading of 103.8 in August, and is 21.2 percent higher than September 2008 when it stood at 90.9.

The gain from a year ago is the largest annual increase on record, and the index is at the highest level since December 2006 when it was 112.8.

Lawrence Yun, NAR chief economist, said the momentum is understandable.
“What we’re witnessing is a rush of first-time buyers trying to beat the expiration of the tax credit at the end of this month,” he said. “Home values will stabilize sooner rather than over-correcting. That, in turn, will mean wealth stabilization for the vast number of middle-class families and lay the foundation for a durable economic recovery.”

Watch a video interview of Yun as he talks about these latest pending-home sales trends.

NAR estimates approximately 3 million renters are now financially well-qualified to buy a median-priced home. “As long as buyers do not overstretch and stay well within their budget, a sizable pent-up demand can be tapped among financially qualified potential buyers,” Yun said. “Although the tax credit is greatly reviving the existing home market, new-home sales may continue to struggle as home builders hold back production to drive down inventory. In addition, there remains an ongoing credit crunch for construction loans.”

The Pending Home Sales Index in the Northeast slipped 2.0 percent to 83.6 in September but remains 16.9 percent above September 2008. In the Midwest the index rose 8.1 percent to 98.2 in September and is 17.8 percent higher than a year ago. In the South, pending home sales increased 4.9 percent to an index of 109.7 and is 22.8 percent above September 2008. In the West the index jumped 10.2 percent to 143.8 and is 23.7 percent above a year ago.

Yun added that strong near-term reports should not be overstated. “We’re clearly not out of the woods because an excess of homes remains on the market despite recent improvements,” he said. “Although current inventory is getting closer to price equilibrium, foreclosures will continue to enter the pipeline. An extended and expanded tax credit would help absorb this incoming inventory.”

— NAR

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Housing Markets

Vacant Homes Up Slightly

Vacant homes in the U.S.—including foreclosures, residences for sale, and vacation properties—rose to 18.8 million in the third quarter, according to the U.S. Census Bureau.

The record high for vacancies was 18.95 million in the first quarter of this year. There were 18.4 vacancies in the third quarter last year.

In total, there were 130.3 million homes in the U.S. in the third quarter, according to the census. About 2 million were for sale, 4.6 million for rent, and 4.6 million were vacation homes that are only used a portion of the year.

Source: Bloomberg, Kathleen M. Howley (10/29/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Housing Markets

New-Home Sales Decline

After increasing for five consecutive months, new-home sales declined 3.6 percent in September compared with August to a seasonally adjusted annual rate of 402,000, the Commerce Department reported yesterday.

Sales were down 7.8 percent compared to September 2008.

Most of the decline was in the West and the South, where sales fell 11 percent and 10 percent respectively. These reduction were offset by transactions in the Midwest, where sales jumped 34 percent.

Analysts were surprised by the decline, and some blamed it on the first-time home buyer tax credit, which sucked up customers eager to buy foreclosure bargains. Others said that the new normal for time between signing the sales contract and closing is two months or longer, a reality that could be reflected in these numbers.

“We don’t know yet if it’s anything more than a blip,” says Steven Ricchiuto, an economist for Mizuho Securities USA.

Source: Washington Post, Renae Merle (10/29/2009)

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Housing Markets

Economists: Extend the Housing Tax Credit

More than 40 percent of all home buyers in 2009 will qualify for the federal tax credit, costing the government about $15 billion, twice the original estimate, but most housing experts applaud the policy and favor expanding it.

Now the decision is up to Congress.

Mark Zandi, chief economist for Moody’s Economy.com, believes that the credit should be expanded to all homebuyers, even investors, through summer of 2010. “The risks of not doing something like this are too great,” he said. “I don’t think the coast is clear.”

James Glassman of JPMorgan Chase also favors expanding the credit but continuing to limit it to first-time buyers.

Industry members who are lobbying for the extension are optimistic and say they believe an extension will be approved in some form. “There will be a lot of water under the bridge, a lot of compromise, between now” and a final bill, said Richard A. Smith, chairman of the Business Roundtable’s Housing Working Group.

Source: The New York Times, David Streitfeld (09/15/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Housing Markets

10 Cities Leading the Market Recovery

Here’s more evidence that housing is turning around. Forbes magazine identified 161 of the country’s largest metro areas where sales activity has increased compared to 2008, and where foreclosure sales as a percentage of total sales, are low.

The magazine considers these markets as on the road to recovery.
1. Miami-Ft. Lauderdale, Fla.
2. Lincoln, Neb.
3. Colorado Springs, Colo.
4. Salem, Ore.
5. San Luis Obispo, Calif.
6. Bremerton, Wash.
7. Denver, Colo.
8. Redding, Calif.
9. Santa Barbara, Calif.
10. San Jose, Calif.

Source: Forbes, Matt Woolsey

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222 ext. 26
Blog: elliottonrealestate.com
Twitter: elliottrob@twitter.com

Housing Markets

Tips for Parents Buying Homes for Children

With home prices low, now could be a good time for parents to give their children a home or even an investment property.

Here are some suggestions for managing the tax consequences from Mark Luscombe, tax analyst with Wolters Kluwer.

* Give a cash gift. Individuals are allowed to gift up to $13,000 per person in a given year without incurring gift tax. That means a couple could give their offspring and spouse $52,000 in a single year to go toward a down payment.

* Lend money. The government requires that family members meet or exceed minimum loan rates to avoid having the loan be considered a gift. The rates are currently low. One way to handle this is for parent to use the $52,000 gift exclusion to forgive both interest and principal.

* Use a trust. Set up a qualified personal residence trust, or QPRT. You’ll need an attorney to handle this transaction, but in a nutshell, parents put the home they want to give their children into a trust. At the end of a pre-set term, the home passes to the children with no taxes due.

Source: The Wall Street Journal, Shelly Banjo (06/25/2009)

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Housing Markets

Troubled Jumbo Loans Hurt Broader Market

Houses that cost more than $730,000 – the cap for conforming jumbo loans – can be extremely tough to buy, sell, or refinance these days, freezing the high-end market and holding down activity in lower-priced markets, real estate practitioners say.

The slowdown results from lenders’ reluctance to offer mortgages above the amount Fannie Mae and Freddie Mac will insure.

“What you’re seeing are those properties sitting on the market for a lot longer because people can’t get loans,” says David Kerr, an associate with ZipRealty in Marin County, Calif. ” All of what we’re showing is in the $200,000 to $300,000 price range.”

States that are most affected are those where jumbos account for more than 10 percent of all mortgages, including Hawaii, California and New York, as well as Washington, D.C., New Jersey, Maryland, Massachusetts, Virginia, Connecticut, Washington, Nevada, and Florida.

The Obama administration program to refinance underwater mortgages doesn’t offer help to holders of jumbo mortgages, so borrowers who can’t refinance are defaulting in increasing numbers. According to First American CoreLogic, jumbos that are 90 days or more delinquent reached 4.83 percent in March 2009, up from 1.68 percent in March 2008.

“We need to have a market recovery in all segments,” says Lawrence Yun, chief economist for the National Association of REALTORS®. “If the high-end market weakens, those in the middle have to reduce prices . . . All of Middle America is undoubtedly impacted.”

Source: USAToday, Stephanie Armour (07/15/2009)
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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222 ext. 26
Blog: elliottonrealestate.com
Twitter: elliottrob@twitter.com

Housing Markets

Unemployed Might Get Anti-Foreclosure Help

The Obama administration is reportedly considering a program that would give loan forbearance to the unemployed. The aim of the program is to provide help without distorting the housing market.

The program would augment the federal loan modification program, giving unemployed workers more time and financial leeway to qualify for a new loan.

So far the loan modification program hasn’t been very successful for a variety of reasons, including the declining equity many troubled borrowers have in their homes and rising unemployment figures that make lenders unwilling to participate.

Last week, the U.S. Treasury Department asked the 25 largest mortgage service companies to appoint a liaison officer to work with the government to slow defaults. On July 28, Treasury will host a meeting with these servicers to examine whether qualified applicants are being ignored.

Source: Reuters News, Patrick Rucker and David Lawder (07/13/2009)

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222 ext. 26
Blog: elliottonrealestate.com
Twitter: elliottrob@twitter.com

Housing Markets

Artificial Turf Wins Over More Fans

More home owners who are sick and tired of mowing the grass are trading their natural turf for artificial.

The artificial turf industry has grown an estimated 20 percent annually for the last five years, according to figures from the Association of Synthetic Grass Installers trade group

Commonly used fibers for artificial turf include polyethylene and polypropylene with granulated tire rubber as an infill. Granulated quartz is an alternative.

A lawsuit in California alleges that synthetic turf has high levels of lead. Darren Brandt, a spokesman for manufacturer FieldTurf, says the product has been proven safe in several studies.

Annie Costa, executive director of the grass installers trade group, says artificial turf will win favor because it is cost effective – about $9 to $12 a square yard, guaranteed for eight years.

Source: The San Diego Union-Tribune, Emmet Piercce (06/28/2009)

Source: Chicago Tribune, Don Lee (07/06/2009)

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Housing Markets

Loan Applications Rise as Rates Fall Again

Loan applications continued to increase last week as mortgage rates decreased, according to the Mortgage Bankers Association weekly mortgage applications survey.

The market index rose 4.3 percent to 514.4 last week from 493.1 the previous week on a seasonally adjusted basis. On an unadjusted basis, the index increased 15.3 percent compared with the previous week and was down 2.7 percent compared with the same week a year ago.

The refinance index was up 17.7 percent while the purchase index decreased 9.4 percent compared to the previous week. More than half of applications were for refinances.

* 30-year fixed-rate mortgages decreased to 5.05 percent from 5.34 percent;
* 15-year fixed-rate mortgages decreased to 4.59 percent from 4.83 percent;
* 1-year ARMs decreased to 6.47 percent from 6.58 percent.

Source: Mortgage Bankers Association (07/15/2009)

——————–
Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222 ext. 26
Blog: elliottonrealestate.com
Twitter: elliottrob@twitter.com

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