Existing-Home Sales Down in January 2010 but Higher Than Year Ago
RISMEDIA, March 4, 2010—Existing-home sales fell in January 2010 but are above year-ago levels, according to the National Association of Realtors. Existing-home sales- including single-family, townhomes, condominiums and co-ops- dropped 7.2% to a seasonally adjusted annual rate of 5.05 million units in January from a revised 5.44 million in December, but remain 11.5% above the 4.53 million-unit level in January 2009.
Lawrence Yun, NAR chief economist, said there is still some delay between shopping and closing that affected current sales. “Most of the completed deals in January were based on contracts in November and December. People who got into the market after the home buyer tax credit was extended in November have only recently started to offer contracts, so it will take a couple months to close those sales,” he said. “Still, the latest monthly sales decline is not encouraging, and raises concern about the strength of a recovery.”
Total housing inventory at the end of January fell 0.5% to 3.27 million existing homes available for sale, which represents a 7.8-month supply at the current sales pace, up from a 7.2-month supply in December. Raw unsold inventory is 9.6% below a year ago, and is at the lowest level since March 2006.
“Activity should be picking up strongly in late spring as buyers take advantage of the tax credit, which is critical to absorb distressed properties reaching the market and to continually chip away at inventory,” Yun said. “With a downtrend in the number of homes on the market, especially in the lower price ranges, values are beginning to firm but with great variance around the country.”
The national median existing-home price for all housing types was $164,700 in January, unchanged from a year earlier. Distressed homes, which accounted for 38% of sales last month, continue to downwardly distort the median price because they typically are discounted in comparison with traditional homes in the same area.
A parallel NAR practitioner survey shows first-time buyers purchased 40% of homes in January, down from 43% in December. Investors accounted for 17% of transactions in January, up from 15% in December; the remaining sales were to repeat buyers. The survey also shows that buyer traffic increased 9.4% in January.
NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said buying a home in the current environment has become more challenging. “First-time buyers and others who need a mortgage are increasingly losing out to all-cash investors for the best bargains in many areas, particularly for foreclosed homes where cash is king,” she said. “Inventory conditions vary by price range, and of course there are major differences depending on location. Realtors are the best buyer resource for strategies on winning bids in increasingly competitive markets,” Golder said. “The bidding for more desirable homes will only accelerate between now and the April 30 contract deadline to qualify for a tax credit of up to $8,000.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage edged up to 5.03% in January from 4.93% in December; the rate was 5.05% in January 2009.
Single-family home sales fell 6.9% to a seasonally adjusted annual rate of 4.43 million in January from a level of 4.76 million in December, but are 8.6% above the 4.08 million pace in January 2009. The median existing single-family home price was $163,600 in January, down 0.4% from a year ago.
Existing condominium and co-op sales dropped 8.1% to a seasonally adjusted annual rate of 620,000 in January from 675,000 in December, but are 38.1% above the 449,000-unit level a year ago. The median existing condo price was $172,400 in January, which is 1.4 % higher than January 2009.
Northeast
Regionally, existing-home sales in the Northeast fell 10.9% to an annual pace of 820,000 in January but are 22.4% above a year ago. The median price in the Northeast was $245,300, a gain of 8.8% from January 2009.
Midwest
Existing-home sales in the Midwest declined 6.9% in January to a level of 1.08 million but are 8.0% higher than January 2009. The median price in the Midwest was $130,300, which is 1.0% below a year ago.
South
In the South, existing-home sales dropped 7.4% to an annual pace of 1.87 million in January but are 12.0% above a year ago. The median price in the South was $140,200, down 2.0% from January 2009.
West
Existing-home sales in the West declined 5.2% to an annual rate of 1.28 million in January but are 7.6% higher than January 2009. The median price in the West was $203,400, down 5.8% from a year ago.
For more information, visit www.realtor.org.
February 6, 2010
Predatory Lending
Predatory Lending: HB 303 creates the Delaware Predatory Refund Anticipation Lending Prevention Act which prohibits unfair lending practices in relation to loans in advance of tax returns and provides civil and administrative enforcement procedures. HB 303 was also on the agenda for Wednesday’s House Economic Development, Banking, Insurance and Commerce Committee but was deferred until a later time.
Leasehold Transactions:
Leasehold Transactions: The House Economic Development, Banking, Insurance and Commerce Committee was expected to consider HB 256 on Wednesday. The bill clarifies that a lessee may mortgage his/her leasehold interest, even if he/she has less than 10 years remaining on the lease term, as long as the original term of the lease was at least 10 years. The legislation was deferred until next week.
House Passes Impact Fee Increase for Appoquinimink:
As reported last week, the House was expected to consider legislation to increase the Voluntary School Assessment fee paid by developers to 6% of the total cost of a residential unit for the Appoquinimink School District. HB 30, passed the House by a vote of 24 yes, 13 no and 4 absent. The legislation is expected to be referred to the Senate Education Committee.
December 23, 2009
3 Sussex County Vacant Homes for use
There may be some houses in Santa’s pack for human service agencies serving Sussex County.
The county has three vacant houses, which after some fixing up could be used for temporary housing.
Even fiscally conservative Council President Vance Phillips, R-Laurel, seemed to be touched by the holiday spirit at the Tuesday, Dec. 15 meeting.
“Maybe there should be a social component to county government,” Phillips said. “As long as it’s revenue neutral.”
After listening to a pair of presentations from organizations in need of housing, County Administrator David Baker said the county purchased three homes near Georgetown in anticipation of county airport expansion. He said the houses would be available for a limited amount of time – one until 2013 and the others until 2020.
Baker said some rehabilitation work would be needed.
By consensus, council agreed to allow county staff to get more information.
The organizations making presentations are involved in providing housing for released prison inmates, homeless people and those recovering from substance abuse.
Patricia Taylor Walp, wife of a fallen police officer and mother of a prison inmate, said The One Program is a 12-month residential reentry initiative that helps incarcerated fathers reconnect with their children.
“We want to bring the father back into the family,” she told council. About 50 percent of all male inmates are fathers.
She said the pilot program would involve inmates at Sussex Correctional Institution where she works as a counselor in the Boot Camp program. She said fathers’ and children’s programs would run simultaneously and include counseling, training, visitations, and employment and educational paths for fathers.
She said the program costs about $17,000 per family a year compared to $26,000 to $30,000 per year to house an inmate in prison.
Jim Martin, Delaware outreach coordinator, was once a resident of Oxford House, which provides housing for people recovering from alcohol and drug addiction. In the self-help environment of an Oxford House, residents are given training and opportunities to stay out of jail while curing their addition.
Not only did Martin conquer his addiction, he became employed by the program and has helped start six houses. Twenty-five Oxford Houses can be found in Delaware, including Georgetown, Lewes and Rehoboth Beach.
He said it’s hard for anyone, let alone those with substance abuse problems, to find affordable housing. He said 14 months is the average stay.
“We are not a halfway house but a three-quarters house because we pay our bills,” Martin said. “Give us a chance and see how cost effective we can be.”
He said he would also like to pursue a modest loan program with the county. Martin said residents pay up to $100 a week for rent.
Baker said other social organizations could be interviewed. “We can do more research to see if the properties fit with any programs,” he said.