There was some good news for housing this morning. The National Association of Realtors’ Pending Home Sales Index rose 0.1% in May. On a year-over-year basis, the index was up 6.7% in May.
It was the first four-month run-up in in the index since October 2004.
The index is based on sales contracts on existing homes. The NAR reports on sales of existing homes once the sales close, usually six to eight weeks later.
It has been predicted by industry experts that the volume of home sales in America will continue to rise as 2009 progresses. Prices are falling, interest rates are at an all time low, and tax incentives for first home buyers are all motivation for buyers these days.
Last week, the National Association of Realtors reported that existing home sales have risen since April. This is the second increase that we have seen in three months. A month ago, the National forecast 2009 sales at 4.97 million and 2010 sales at 5.28 million. “Housing affordability conditions have been at historic highs, but now the $8000 tax credit for first time buyers is beginning to impact the market,” says Lawrence Yun, Chief Economists for NAR. This is yet another reason why there has never been a better time to buy.
Unemployment is a major concern as a result of the current economic conditions, and unemployment fears may be associated with “on the fence buyers” in today’s housing market.
The simple fact is that people don’t have the sense of job security that they once did, so they are holding off on making large purchases, such as a house. Coldwell Banker Inc. is happy to announce that they are launching a new incentive program, The Paycheck Guardian.
This program provides a qualified homebuyer a monthly benefit of up to $1,500 for 6 months in the event of job loss. This plan also includes a $10,000 lump sum payment for accidental death. If a seller decides to purchase this program, they can include this insurance as an additional feature on their home listing.
This program offers peace of mind that can also provide competitive advantage over other listings in your marketplace.
The Outer Banks housing market is beginning to show signs of positive growth. In April there were a total of 150 properties that went into an “Under Contract” status, according to the Outer Banks Association of Realtors. This compares favorably to one year earlier, April 2008, when we saw 159 properties go “Under Contract”. While we are still tracking behind last year’s numbers, this is the closest we’ve been, month over month, in a long time.
In fact, the Outer Banks has shown five continuous months of increases in homes going under contract. Which makes this is the first time since early 2005 that we’ve seen five months of continuous increases in sales agreements.
With this trend we expect to see continued improvements in the numbers of buyers coming off of the sidelines and purchasing homes. This will result in a continued shrinking of inventory and the eventual increase in values.
To learn more, contact sales@seasiderealty.com.
Occupied homes seem to sell better, especially in a very competitive market. Realtors and builders have used staging techniques to help sell homes for a long time, but “staging” is reaching new heights these days.
Builders have developed a new strategy to help sell their new construction in a distressed real estate market. Johanna Calvin is a 45-year old Los Angeles event coordinator and decorator who has seen business slow. Quality First Home Marketing, a San Diego start-up, is offering Johanna incentives for giving their townhomes a stylish look that make the home seem like someone is living there. Usually “Home Staging” companies will charge the homeowner thousands of dollars to decorate the house with furniture, but Johanna actually lives in the townhouses for a greatly discounted rate and also receives a bonus if the house sells quickly.
Vacancy of homes is a factor that can drive the price of real estate down. By filling the homes, the real estate will in turn gain more value. Showhomes Management LLC, a franchise operation based in Nashville, has about 350 “resident managers” who occupy these high end homes in order to facilitate sales. The company has reported that their revenues have increased 88% since last year!