Driven by the home buyer tax credit, existing-home sales showed another big gain in October with a strong uptrend established over the past seven months, according to the NATIONAL ASSOCIATION OF REALTORS®. At the same time, inventories have continued to decline.
Existing-home sales—including single-family, townhomes, condominiums and co-ops—surged 10.1 percent to a seasonally adjusted annual rate of 6.10 million units in October from a downwardly revised pace of 5.54 million in September, and are 23.5 percent above the 4.94 million-unit level in October 2008. Sales activity is at the highest pace since February 2007 when it hit 6.55 million.
Tax Credit Fuels Surge
Lawrence Yun, NAR chief economist, was surprised at the size of the gain. “Many buyers have been rushing to beat the deadline for the first-time buyer tax credit that was scheduled to expire at the end of this month, and similarly robust sales may be occurring in November,” he said. “With such a sale spike, a measurable decline should be anticipated in December and early next year before another surge in spring and early summer.”
Now that the tax credit has been extended and expanded, potential buyers have until April 30 to have a contract in place. “There is still a large pent-up demand that can be tapped before the tax credit expires. Our recent consumer survey further shows that 13 percent of successful first-time buyers had a previous contract that was cancelled or fell through—there likely are many more buyers who were attempting to purchase but simply ran out of time,” Yun said.
Historically low interest rates also are boosting the market. “Mortgage interest rates last month were the third lowest on record dating back to 1971,” Yun noted. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 4.95 percent in October from 5.06 percent in September; the rate was 6.20 percent in October 2008. Last week, Freddie Mac reporter the 30-year rate dropped to 4.83 percent.
Friday, November 27, 2009
Existing-Home Sales Record Big Gains
Wednesday, November 25, 2009
Dallas-Fort Worth home prices down only 1.2% in S&P report
Dallas-Fort Worth home prices held almost steady in the latest Standard & Poor's/Case-Shiller Home Price Index – down 1.2 percent from a year ago.
It was one the smallest annual declines in more than a year in the closely watched index of home prices around the country.
September prices were down 0.7 percent from August, ending a six-month string of month-over-month gains.
"The month-to-month changes will likely continue to be somewhat bumpy over the coming year," said David Brown, who heads the Dallas office of housing analyst Metrostudy Inc. "I don't think we will see much of an increase in home values until job growth returns and the number of foreclosures begins to drop."
Nationwide, prices fell 9.4 percent in September from a year earlier in the 20 cities Case-Shiller tracks.
Monday, November 23, 2009
Existing-Home Sales Record Big Gains
Driven by the home buyer tax credit, existing-home sales showed another big gain in October with a strong uptrend established over the past seven months, according to the NATIONAL ASSOCIATION OF REALTORS®. At the same time, inventories have continued to decline.
Existing-home sales—including single-family, townhomes, condominiums and co-ops—surged 10.1 percent to a seasonally adjusted annual rate of 6.10 million units in October from a downwardly revised pace of 5.54 million in September, and are 23.5 percent above the 4.94 million-unit level in October 2008. Sales activity is at the highest pace since February 2007 when it hit 6.55 million.
Tax Credit Fuels Surge
Lawrence Yun, NAR chief economist, was surprised at the size of the gain. “Many buyers have been rushing to beat the deadline for the first-time buyer tax credit that was scheduled to expire at the end of this month, and similarly robust sales may be occurring in November,” he said. “With such a sale spike, a measurable decline should be anticipated in December and early next year before another surge in spring and early summer.”
Now that the tax credit has been extended and expanded, potential buyers have until April 30 to have a contract in place. “There is still a large pent-up demand that can be tapped before the tax credit expires. Our recent consumer survey further shows that 13 percent of successful first-time buyers had a previous contract that was cancelled or fell through—there likely are many more buyers who were attempting to purchase but simply ran out of time,” Yun said.
Historically low interest rates also are boosting the market. “Mortgage interest rates last month were the third lowest on record dating back to 1971,” Yun noted. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 4.95 percent in October from 5.06 percent in September; the rate was 6.20 percent in October 2008. Last week, Freddie Mac reporter the 30-year rate dropped to 4.83 percent.
Sunday, November 22, 2009
Buying a Home in Time to Get Credit .
House hunting usually slows down this time of year, as people put their searches on hold during the holidays.
This winter could be different, however, thanks to the extension -- and expansion -- of the first-time home-buyer tax credit.
"We're going to see far more interest in the fourth quarter than we generally do because of the tax credit," says Heather Fernandez, vice president of Trulia.com, a real-estate search engine. Traffic surged on the site on Nov. 5, the day Congress approved the credit extension, she says.
The new law extends the tax credit for first-time home buyers and opens it up to some existing homeowners as well: The credit is now up to $8,000 for first-time buyers and up to $6,500 for repeat buyers.
All buyers must have a binding contract on a house in place on or before April 30. The purchase must be for a principal residence and must close on or before June 30.
To be considered a first-time home buyer, an individual must not have owned a home in the past three years. And to be eligible, existing homeowners need to have lived in the same principal residence for five consecutive years during the eight-year period that ends when the new home is purchased
Friday, November 20, 2009
Report: Nearly 10% of Texans running late on home loans
Almost 10 percent of Texans were behind in their home loan payments during the third quarter. And about 2 percent of the state's mortgage holders were in foreclosure at the end of September, the Mortgage Bankers Association reported Thursday.
The number of Texans behind on home loan payments has risen by more than one percentage point in the last year.
But the state's loan delinquency rate of 9.84 percent is still slightly behind the national average for the quarter, which is at a record 9.94 percent.
And Texas' foreclosure rate is less than half the national average.
Delinquent Mortgages Reach Record Levels
The combined percentage of loans in foreclosure or at least one payment past due was 14.41 percent on a non-seasonally adjusted basis, the highest ever recorded in an MBA delinquency survey.
The bankers blamed the high foreclosure levels on unemployment. “Over the last year, we have seen the ranks of the unemployed increase by about 5.5 million people, increasing the number of seriously delinquent loans by almost 2 million loans and increasing the rate of new foreclosures from 1.07 percent to 1.42 percent,” says Jay Brinkmann, MBA’s chief economist.
Thursday, November 19, 2009
Weak U.S. home construction weighing down economic rebound; inflation still tame
WASHINGTON - The budding American economic recovery is getting little help from the home building industry, which normally creates jobs and boosts growth as a recession ends.
Construction of homes unexpectedly plunged last month to its lowest point since April, the Commerce Department said Wednesday. The weak figures show that builders still lack confidence that buyers can soak up the glut of unsold homes already on the market - a supply magnified by a record number of home foreclosures.
The figures also illustrate how much the fledgling recovery depends on government support. Builders broke ground on fewer homes in part because of uncertainty in October about whether Congress would extend a tax credit for homebuyers. Earlier this month, lawmakers renewed the credit and extended it to more buyers.
Wednesday, November 18, 2009
Renting From Fannie Mae
Homeowners going through foreclosure can rent their houses through Fannie Mae rather than lose them entirely. The "deed for lease" program lets homeowners transfer their title toFannie Mae and sign up for a one-year lease, then month-to-month extensions. Though this program is helping to keep people in their homes, is it helping the housing market, too? The number of foreclosures has been declining for the past three months, according to Realtytrac. There were 332,292 foreclosed properties in October, down 3% from September but up approximately 19% from last October. The Fannie Mae ( FNM - news -people ) program is helping foreclosed families have more security, says Dean Baker, co-director of the Center for Economic and Policy Research. During many former bubble markets, he notes, ownership costs are significantly higher than the cost of renting an equivalent property. The savings on a moderate-priced home in the Washington, D.C. area that was purchased near the peak of the market could be $1,300 a month; the gap between costs of ownership and costs of renting in Los Angeles could be about $2,000 a month.The firm is letting foreclosed upon families experiencing rent their homes. Is this delaying the inevitable or helping the housing situation?
First Time Home Buyer Tax Credit Extencion FAQ
Do you know that even you already sold your house and have
not been living in it, but you had lived in it five consecutive years over the
last eight years, you will be eligible for $6,500 tax credit? Please check out
the FAQ about the First Time Homebuyer Credit extension!
Friday, November 13, 2009
3rd drop in foreclosures hints at recovery; state-by-state chart
RealtyTrac, an Irvine, Calif., real estate firm, reports Thursday that foreclosure filings totaled 332,292 last month, down 3% from September but up 19% from a year earlier. The figure means that one of every 385 homes received a foreclosure notice in October.
"It looks like it's leveling out," says Bernard Baumohl, chief global economist at the Economic Outlook Group in Princeton, N.J. "We're not seeing further deterioration in the housing market."
RealtyTrac CEO James Saccacio said that the third-straight monthly drop was unprecedented and perhaps a sign "that the foreclosure tide may be turning" but warned that "the fundamental forces driving foreclosure activity in this housing downturn – high-risk mortgages, negative equity and unemployment – continue to loom over any nascent recovery."
Four states – California, Florida, Illinois and Michigan – accounted for 52% of last month's foreclosures.
Seven of the 10 U.S. metropolitan areas with the worst foreclosure rates were in California: Vallejo-Fairfield; Modesto; San Bernardino ; Bakersfield ; Merced; Stockton; and Sacramento.
Tuesday, November 10, 2009
Dallas-Fort Worth home prices rose slightly in third quarter
Dallas-Fort Worth home sales prices were up slightly in the third quarter, according to a closely watched national comparison.
Sales prices in the D-FW area were up 0.2 percent from a year earlier in the National Association of Realtors’ quarterly report.
It’s the first time the D-FW price number has been positive since the fourth quarter of 2007.
Nationwide home prices were down 11.2 percent in the third quarter compared with the same period last year, the Realtors group said Tuesday.
Prices fell in 123 of the 153 markets the association tracks through transactions in sales agents’ Multiple Listing Service.
Monday, November 9, 2009
Dallas-Fort Worth pre-owned home sales score double-digit gain
North Texas pre-owned home sales surged in October – up 11 percent from a year ago. It was the first double-digit gain in more than a year and the best sign yet that the local housing market has turned the corner. Real estate agents sold more than 6,300 single-family homes last month through the Multiple Listing Service, according to numbers released Monday by the Real Estate Center at Texas A&M University and North Texas Real Estate Information Systems.
Friday, November 6, 2009
Dallas-area home foreclosures up
Home foreclosure rates in the Dallas-Plano-Irving area rose for the month of September over the same month last year, but remain below the national foreclosure rate, according to data released Thursday.
The rate of foreclosures among outstanding mortgage loans was 1.26 percent for September, an increase of 0.35 percentage points compared to September of 2008 when the rate was 0.91 percent, according to First American CoreLogic, a real estate data collection company.
Foreclosure activity in Dallas-Plano-Irving was lower than the national foreclosure rate of 2.93 percent for September 2009, but slightly higher than the Texas rate of 1.15 percent, according to First American, which collects national, state and local data on home prices, foreclosure and delinquency.
Thursday, November 5, 2009
The Basics: Extended Home Buyer Tax Credit 2009/2010
Bringing the Dream of Homeownership Within Reach
As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:
- Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
- Expands the credit to grant a $6,500 credit to current home owners purchasing a new or existing home between the date the bill is signed by President Obama and April 30, 2010.
Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream.
Tuesday, November 3, 2009
Five Reasons the U.S. Doesn't Need More Home-Buyer Perks
Congress is working on a new and even more generous set of perks for house buyers. A tentative deal in the U.S. Senate would extend the closing deadline for an $8,000 subsidy for first-time buyers to July 1 from Nov. 30. It would also boost the program's income limits for singles to $125,000 from $75,000 and for couples to $250,000 from $150,000, and would offer a new $6,500 reward for existing homeowners who buy again. (More on the home buyer tax credit.)
The National Association of Realtors has called such an extension "essential." The Mortgage Bankers Association agrees. The National Association of Home Builders says, "Failure to act now could derail the fragile housing recovery even before it has time to take root."
I respectfully disagree for perhaps a dozen reasons. Let me offer five.
- Subsidies raise prices, and house prices are already too high.
Consumer subsidies puff up buying power, which artificially increases demand, which raises prices. With most goods, manufacturers respond by increasing supply, which brings costs back down. Some goods face constraints to new supply, though. We can build more colleges, but we can't magically make more of the longstanding, prestigious kind. We can make more pills, but we can't violate drug makers' patents on popular ones. And we can build new houses, but there's only so much space (or building permission) in the choicest locations. That produces a paradox: America's government has for decades spent mightily on affordability initiatives for college courses, health care and houses, and yet prices for all three goods have increased faster than the rate of inflation, resulting in less affordability.
In April 2007 I wrote that houses had gotten so expensive that renting had come to make more financial sense. In July, with prices down about 30% nationwide, I charted them against rents and incomes to show that the country was closing in on its historical level of housing affordability, but wasn't quite there yet. It never did get there. Prices in most markets have increased each month since then. We're moving away from normal, not toward it. When the National Association of Home Builders speaks of a "fragile housing recovery," it means an increase in prices. But what about a recovery of the ability of ordinary Americans to buy houses at fair prices? That recovery might have to wait.
