Copy for Real Estate Guide Column for 11-13-09
REAL ESTATE PATTERNS
By Ken DuVall
BIG REBOUND
U.S. existing-home sales bounced back strongly in September with first-time buyers driving much of the activity, marking 7 gains in the past 8 months, and 9.2% higher than the pace in September 2008. Sales activity is at the highest level in over 2 years. It was the highest reading since December 2006 and more than 21% above a year ago. Distressed home sales accounted for 29% of transactions in September, which reduces unsold inventory. Buyers are enjoying affordability conditions the highest in 40 years.
Much of the momentum is from the first-time buyer tax credit, which is also freeing many sellers to buy a replacement home. The tax credit will be extended through April 2010. Not to worry about the Nov 30th cutoff now. Move-up buyers also got included in the new expanded bill. Meanwhile, Treasury and IRS agents have uncovered more tax credit fraud. Some 580 children as young as 4 have received $627,000 in first-time homebuyer credits, plus 187 criminal schemes have been identified with 107,000 investigations of civil violations now underway. A perfect example of how to bite the hand that feeds us.
The U.S. Unsold Housing Inventory Index in September fell 7.5%, representing a 7.8-month supply, down from a 9.3-month supply in August. Unsold inventory totals are 15% below a year ago. The index indicates the number of months to deplete the supply of homes on the market at the current sales pace. The current housing supply is the lowest in 2 1/2 years. If we continue to absorb inventory at this pace, prices will return to normal, with modest appreciation patterns next year. Let’s hear a big amen for that!
Meanwhile back at the ranch, California home sales increased 2.1% in September compared with the same period a year ago, while the median price of an existing home declined only 7.3%. Sales in September 2009 increased 0.6% compared with August. The September 2009 median price rose 1.1% compared with August’s $292,960 median price vs. $319,310 in September 2008. This marks a new milestone in September when several Calif. Assn. of Realtor’s regions reported positive year-to-year increases in the median price, the first since January 2008.
If that wasn’t enough, September also marked the 7th consecutive month of increases in the statewide median price and the first single-digit decline in the year-to-year median price since October 2007, after 22 consecutive months of double-digit decreases. Efforts by the government to stimulate housing and the economy are favorably impacting the market. Sales have exceeded 500,000 homes for 13 consecutive months, and now are 33% higher compared with 2008 sales.
The Unsold Inventory Index for existing California single-family homes in September 2009 was 4.2 months, compared with 6.5 months for the same period a year ago. The number of days to sell was 33.6 days in September 2009, compared with 46.2 days for the same period a year ago. We are witnessing the sharpest turnaround in American home prices in 100 years. Don’t fret about Chico. We’re looking good too.
REAL ESTATE PATTERNS
By Ken DuVall
BIG REBOUND
U.S. existing-home sales bounced back strongly in September with first-time buyers driving much of the activity, marking 7 gains in the past 8 months, and 9.2% higher than the pace in September 2008. Sales activity is at the highest level in over 2 years. It was the highest reading since December 2006 and more than 21% above a year ago. Distressed home sales accounted for 29% of transactions in September, which reduces unsold inventory. Buyers are enjoying affordability conditions the highest in 40 years.
Much of the momentum is from the first-time buyer tax credit, which is also freeing many sellers to buy a replacement home. The tax credit will be extended through April 2010. Not to worry about the Nov 30th cutoff now. Move-up buyers also got included in the new expanded bill. Meanwhile, Treasury and IRS agents have uncovered more tax credit fraud. Some 580 children as young as 4 have received $627,000 in first-time homebuyer credits, plus 187 criminal schemes have been identified with 107,000 investigations of civil violations now underway. A perfect example of how to bite the hand that feeds us.
The U.S. Unsold Housing Inventory Index in September fell 7.5%, representing a 7.8-month supply, down from a 9.3-month supply in August. Unsold inventory totals are 15% below a year ago. The index indicates the number of months to deplete the supply of homes on the market at the current sales pace. The current housing supply is the lowest in 2 1/2 years. If we continue to absorb inventory at this pace, prices will return to normal, with modest appreciation patterns next year. Let’s hear a big amen for that!
Meanwhile back at the ranch, California home sales increased 2.1% in September compared with the same period a year ago, while the median price of an existing home declined only 7.3%. Sales in September 2009 increased 0.6% compared with August. The September 2009 median price rose 1.1% compared with August’s $292,960 median price vs. $319,310 in September 2008. This marks a new milestone in September when several Calif. Assn. of Realtor’s regions reported positive year-to-year increases in the median price, the first since January 2008.
If that wasn’t enough, September also marked the 7th consecutive month of increases in the statewide median price and the first single-digit decline in the year-to-year median price since October 2007, after 22 consecutive months of double-digit decreases. Efforts by the government to stimulate housing and the economy are favorably impacting the market. Sales have exceeded 500,000 homes for 13 consecutive months, and now are 33% higher compared with 2008 sales.
The Unsold Inventory Index for existing California single-family homes in September 2009 was 4.2 months, compared with 6.5 months for the same period a year ago. The number of days to sell was 33.6 days in September 2009, compared with 46.2 days for the same period a year ago. We are witnessing the sharpest turnaround in American home prices in 100 years. Don’t fret about Chico. We’re looking good too.
Ken owns Ken DuVall & Associates, REALTORS at 3rd Ave. & Mangrove in Chico. Ken was the 2001 President of the Chico Assn. of Realtors and the 1995 Chico Realtor of the Year. See Chico MLS listings and all my columns at www.KenDuVall.com. Call Ken at 345-3700 for all your real estate needs. Free consulting.
posted by Ken DuVall @ 12:50 PM
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