Jun. 23, 2009 07:21 AM
Bloomberg News
Home resales in the U.S. rose in May for a second month as record foreclosures caused prices to drop.
Purchases increased 2.4 percent to an annual rate of 4.77 million, lower than forecast, the National Association of Realtors said today in Washington. The median price fell 17 percent, the third-largest decrease on record.
Tax breaks for first-time buyers in the Obama administrations stimulus plan, falling property values and lower mortgage rates have helped support the market. At the same time, any recovery is likely to be limited with unemployment rising and borrowing costs shooting back up.
Were seeing some signs of stability, Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Florida, said before the report. A lot is going to depend on mortgage rates if they stay low. You're still looking at a lot of supply out there and its going to take a long time to work through all of that.
Economists forecast existing sales would rise to a 4.82 million rate, according to the median of 74 projections in a Bloomberg News survey. Estimates ranged from 4.6 million to 5 million. Aprils reading was revised down to a 4.66 million pace from 4.68 million.
Mays sales pace was the strongest since October and last months gain marked the first back-to-back increase since 2005.
May traditionally is one of the top three sales months of the year as the weather turns warmer and families prepare to move before the start of the next school year, according to the NAR. The group adjusts the figures for these seasonal variation in order to facilitate month-to-month comparisons.
Sales were 3.6 percent compared with a year earlier.
The number of houses on the market dropped 3.5 percent to 3.8 million in May, NAR said. At the current sales pace, it would take 9.6 months to sell those homes, compared with 10.1 months in April.
The median price of an existing home fell to $173,000 in May from $207,900 a year earlier, the NAR said. The price has fallen as sales slumped and financial institutions auctioned off foreclosed properties.
While the loss has devastated some family, others were able to buy a house for the first time because of the drop in values. The federal government is trying to stabilize the market by offering lenders incentives to modify the terms of delinquent mortgages and the Federal Reserve has pledged to buy mortgage- backed securities to free up funding for home loans.
The share of homes sold as foreclosures or otherwise distressed properties was about 33 percent last month, down from the 40 percent to 50 percent seen earlier in the year, NAR said.
Foreclosure filings in the U.S. surpassed 300,000 for a third straight month in May and may reach a record 1.8 million by the first half of the year, RealtyTrac Inc. said June 11.
The jump in foreclosures is one of the reasons more first- time buyers have entered the market. First-time buyers accounted for about 29 percent of May sales.
The Obama administrations stimulus plan provided an $8,000 tax credit for first-time home buyers for purchases completed before Dec. 1.
Still, soaring unemployment and high levels of debt will put home ownership beyond the reach of would-be buyers even as home prices fall, according to a report yesterday by Harvard University's Joint Center for Housing Studies.
Mortgage borrowing costs are also starting to climb. The rate on a 30-year fixed loan has averaged 5.42 percent so far this month, up from 4.86 percent in May, according to figures from Freddie Mac. The rate reached 4.78 percent in April, the lowest level since records began in 1972.
Monday, June 29, 2009
Friday, June 12, 2009
How to Sell Your House Fast When Foreclosure Looms
By Tara-Nicholle Nelson, Esq., FrontDoor.com
When foreclosure looms, many homeowners try to sell their homes. For them, the goal is not just to get the home sold, but to do it quickly. Foreclosure rates are the highest in buyer's markets, when homes take a longer than average time to sell. What's a homeowner to do? Get aggressive, and get your home sold fast!
As a seller, you control the only three factors that influence whether your home sells quickly: pricing, marketing and condition. Here are some easy steps and insider secrets to make your home fly off the market in record time!
Pricing Your House
Don't try to salvage equity that does not exist. The fact that you bought your home for thousands more than homes are currently selling for in your neighborhood is irrelevant to the current fair market value of your home. You have to get clear on your goal: Are you trying to eke dollars out of your home by holding out for the highest price, or are you trying to avoid the seven-year black mark that a foreclosure will leave on your credit report?
Don't overprice your home. Get clear about what you want. If you'd like to get your home sold, make sure you price it aggressively and that means low. If your home is overpriced, some buyers won't even see it because it will appear to be out of their price range. Other buyers will focus on seeing properties whose sellers seem more realistic about pricing. Your house will sit on the market longer than it should and then the lowballers will crawl out of the woodwork.
Get real about what your home is worth. Have your real estate agent prepare a Comparative Market Analysis (CMA) that shows recently sold, similar homes in your neighborhood. If you're serious about getting it sold fast, take the sales prices (not the list prices) from the most recently sold homes in your area, and then go down 10 percent or so from there to get your list price. When a home is slightly underpriced, it seems like a bargain. More buyers will come out to see it, and chances of getting a qualified offer skyrocket.
Make sure you have an accurate understanding of how low you can go. A buyer is not going to pay a premium price for your home just because that's what you owe. If you owe more than your home is worth, you may need to consider a short sale (selling for less than you owe). A short sale blemishes your credit but not as badly as a foreclosure does!
When foreclosure looms, many homeowners try to sell their homes. For them, the goal is not just to get the home sold, but to do it quickly. Foreclosure rates are the highest in buyer's markets, when homes take a longer than average time to sell. What's a homeowner to do? Get aggressive, and get your home sold fast!
As a seller, you control the only three factors that influence whether your home sells quickly: pricing, marketing and condition. Here are some easy steps and insider secrets to make your home fly off the market in record time!
Pricing Your House
Don't try to salvage equity that does not exist. The fact that you bought your home for thousands more than homes are currently selling for in your neighborhood is irrelevant to the current fair market value of your home. You have to get clear on your goal: Are you trying to eke dollars out of your home by holding out for the highest price, or are you trying to avoid the seven-year black mark that a foreclosure will leave on your credit report?
Don't overprice your home. Get clear about what you want. If you'd like to get your home sold, make sure you price it aggressively and that means low. If your home is overpriced, some buyers won't even see it because it will appear to be out of their price range. Other buyers will focus on seeing properties whose sellers seem more realistic about pricing. Your house will sit on the market longer than it should and then the lowballers will crawl out of the woodwork.
Get real about what your home is worth. Have your real estate agent prepare a Comparative Market Analysis (CMA) that shows recently sold, similar homes in your neighborhood. If you're serious about getting it sold fast, take the sales prices (not the list prices) from the most recently sold homes in your area, and then go down 10 percent or so from there to get your list price. When a home is slightly underpriced, it seems like a bargain. More buyers will come out to see it, and chances of getting a qualified offer skyrocket.
Make sure you have an accurate understanding of how low you can go. A buyer is not going to pay a premium price for your home just because that's what you owe. If you owe more than your home is worth, you may need to consider a short sale (selling for less than you owe). A short sale blemishes your credit but not as badly as a foreclosure does!
Tuesday, June 2, 2009
Pending home sales rise 6.7 percent in April
Jun. 2, 2009 07:26 AM
Associated Press
Pending U.S. home sales in April posted the biggest monthly jump in nearly eight years, a sign that home sales are finally coming to life after a long and painful slump.
The National Association of Realtors says its seasonally adjusted index of sales contracts signed in April rose 6.7 percent to 90.3. Economists surveyed by Thomson Reuters expected the index would edge up to 85 from a reading of 84.6 in March. It was the biggest monthly jump since October 2001.
Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future existing home sales. The index was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January.
Associated Press
Pending U.S. home sales in April posted the biggest monthly jump in nearly eight years, a sign that home sales are finally coming to life after a long and painful slump.
The National Association of Realtors says its seasonally adjusted index of sales contracts signed in April rose 6.7 percent to 90.3. Economists surveyed by Thomson Reuters expected the index would edge up to 85 from a reading of 84.6 in March. It was the biggest monthly jump since October 2001.
Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future existing home sales. The index was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January.
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