The uptrend in existing-home sales continues, with January sales rising for the third consecutive month with a pace that is now above levels a year ago, according to the NATIONAL ASSOCIATION OF REALTORS®.
Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 2.7 percent to a seasonally adjusted annual rate of 5.36 million in January from a downwardly revised 5.22 million in December, and are 5.3 percent above the 5.09 million level in January 2010. This is the first time in seven months that sales activity was higher than a year earlier.
Lawrence Yun, NAR chief economist, said the improvement is good but could be better. “The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence,” Yun said. “The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity.”
A parallel NAR practitioner survey shows first-time buyers purchased 29 percent of homes in January, down from 33 percent in December and 40 percent in January 2010 when an extended tax credit was in place.
Investors accounted for 23 percent of purchases in January, up from 20 percent in December and 17 percent in January 2010; the balance of sales were to repeat buyers. All-cash sales rose to 32 percent in January from 29 percent in December and 26 percent in January 2010.
“Increases in all-cash transactions, the investor market share and distressed home sales all go hand-in-hand. With tight credit standards, it’s not surprising to see so much activity where cash is king and investors are taking advantage of conditions to purchase undervalued homes,” Yun said. All-cash purchases are at the highest level since NAR started measuring these purchases monthly in October 2008, when they accounted for 15 percent of the market. The average of all-cash deals was 20 percent in 2009, rising to 28 percent last year.
The national median existing-home price for all housing types was $158,800 in January, down 3.7 percent from January 2010. Distressed homes edged up to a 37 percent market share in January from 36 percent in December; it was 38 percent in January 2010.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said the median price is being dampened by unusual market factors. “Unprecedented levels of all-cash purchases, primarily of distressed homes sold at deep discounts, undoubtedly pulls the median price downward,” Phipps said. “Given the levels of inventory we see today, we believe that traditional homes in good condition have held their value.”
Total housing inventory at the end of January fell 5.1 percent to 3.38 million existing homes available for sale, which represents a 7.6-month supply at the current sales pace, down from an 8.2-month supply in December. The inventory supply is at the lowest level since December 2009 when there was a 7.3-month supply.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.76 percent in January from 4.71 percent in December; the rate was 5.03 percent in January 2010.
Single-family home sales rose 2.4 percent to a seasonally adjusted annual rate of 4.69 million in January from 4.58 million in December, and are 4.9 percent higher than the 4.47 million level in January 2010. The median existing single-family home price was $159,400 in January, down 2.7 percent from a year ago.
Existing condominium and co-op sales increased 4.7 percent to a seasonally adjusted annual rate of 670,000 in January from 640,000 in December, and are 7.9 percent above the 621,000-unit pace one year ago. The median existing condo price was $154,900 in January, which is 10.2 percent below January 2010.
Regional SalesNortheast: Regionally, existing-home sales in the Northeast fell 4.6 percent to an annual pace of 830,000 in January from a spike in December and are 1.2 percent below January 2010. The median price in the Northeast was $236,500, which is 4.0 percent below a year ago.
Midwest :"Existing-home sales in the Midwest rose 1.8 percent in January to a level of 1.14 million and are 3.6 percent above a year ago. The median price in the Midwest was $126,300, which is 3.2 percent below January 2010.
South: In the South, existing-home sales increased 3.6 percent to an annual pace of 2.02 million in January and are 8.0 percent higher than January 2010. The median price in the South was $136,600, down 2.1 percent from a year ago.
West: Existing-home sales in the West rose 7.9 percent to an annual level of 1.37 million in January and are 7.0 percent above January 2010. The median price in the West was $193,200, down 5.7 percent from a year ago
Real Estate Outlook: Home Sales Rebounded 4th Quarter
The latest news from the National Association of Realtors is good. According to their latest survey, home sales rebounded in 49 states during the fourth quarter with 78 markets – just over half of the available metropolitan areas – experiencing price gains from a year ago, while most of the rest saw price weakness.
Lawrence Yun, NAR chief economist, had positive things to say about this gain. "Home sales clearly recovered in the latter part of 2010 and are helping to absorb the inventory, including many distressed properties. Even with foreclosures continuing to enter the inventory pipeline, they’ve been selling well and housing supplies have trended down," he said. "A recovery to normalcy requires steady trimming of the inventories."
Total state existing-home sales rose by 15.4 percent in the 4th quarter. The median existing single-family price was $170,600 -- up slightly from the 4th quarter of 2009. Distressed properties, approximately 34 percent of 4th quarter sales, sold at a discount of 10 to 15 percent, a similar trend to what was seen a year earlier.
The NAR believes a housing recovery still rests firmly on a jobs recovery. Yun noted, "An improving housing market and job growth will go hand in hand. The housing recovery will mean faster job growth."
This is welcome news in a market where much remains unsure and unstable. The White House missed a recent deadline last week for a decision on what to do with mortgage giants Freddie Mac and Fannie Mae, who are currently under the conservatorship of the Federal Housing Finance Agency.
According to the New York Times, "The diminished urgency on both sides reflects the political realities of power-sharing, the fear of doing further damage to housing prices, and a great deal of uncertainty about the best approach to rebuilding the mortgage business."
What is on the horizon for the economy? Federal Reserve Chairman, Ben Bernanke, reported last week to the U.S. House of Representatives' Committee on the Budget, that it was a hard battle last year, as economic growth slowed in the Spring as a result of concerns over inventories, fiscal stimulus and the European debt crisis.
He noted that, "The initial phase of the recovery, which occurred in the second half of 2009 and in early 2010, was in large part attributable to the stabilization of the financial system, the effects of expansionary monetary and fiscal policies."
He reports that "construction remains weak, though, reflecting an overhang of vacant and foreclosed homes and continued poor fundamentals for most types of commercial real estate. Overall, improving household and business confidence, accommodative monetary policy, and more-supportive financial conditions, including an apparently increasing willingness of banks to lend, seem likely to result in a more rapid pace of economic recovery in 2011 than we saw last year."
We all have our fingers crossed that jobs and housing will recover in 2011, but only time will tell.
Lawrence Yun, NAR chief economist, had positive things to say about this gain. "Home sales clearly recovered in the latter part of 2010 and are helping to absorb the inventory, including many distressed properties. Even with foreclosures continuing to enter the inventory pipeline, they’ve been selling well and housing supplies have trended down," he said. "A recovery to normalcy requires steady trimming of the inventories."
Total state existing-home sales rose by 15.4 percent in the 4th quarter. The median existing single-family price was $170,600 -- up slightly from the 4th quarter of 2009. Distressed properties, approximately 34 percent of 4th quarter sales, sold at a discount of 10 to 15 percent, a similar trend to what was seen a year earlier.
The NAR believes a housing recovery still rests firmly on a jobs recovery. Yun noted, "An improving housing market and job growth will go hand in hand. The housing recovery will mean faster job growth."
This is welcome news in a market where much remains unsure and unstable. The White House missed a recent deadline last week for a decision on what to do with mortgage giants Freddie Mac and Fannie Mae, who are currently under the conservatorship of the Federal Housing Finance Agency.
According to the New York Times, "The diminished urgency on both sides reflects the political realities of power-sharing, the fear of doing further damage to housing prices, and a great deal of uncertainty about the best approach to rebuilding the mortgage business."
What is on the horizon for the economy? Federal Reserve Chairman, Ben Bernanke, reported last week to the U.S. House of Representatives' Committee on the Budget, that it was a hard battle last year, as economic growth slowed in the Spring as a result of concerns over inventories, fiscal stimulus and the European debt crisis.
He noted that, "The initial phase of the recovery, which occurred in the second half of 2009 and in early 2010, was in large part attributable to the stabilization of the financial system, the effects of expansionary monetary and fiscal policies."
He reports that "construction remains weak, though, reflecting an overhang of vacant and foreclosed homes and continued poor fundamentals for most types of commercial real estate. Overall, improving household and business confidence, accommodative monetary policy, and more-supportive financial conditions, including an apparently increasing willingness of banks to lend, seem likely to result in a more rapid pace of economic recovery in 2011 than we saw last year."
We all have our fingers crossed that jobs and housing will recover in 2011, but only time will tell.
Why Hire a Real Estate Agent or REALTOR?
As spring rolls in, many people start listing their home for sale. The weather warms up and buyers, having recovered from the holidays, begin to house hunt.
Many buyers will go it alone. They hit the Internet for their first line of attack in house hunting. They peruse magazines and open houses. But they miss an important key player in their house-hunting mission–the real estate agent.
The real estate agent is not a go-between paper shuffler. Your real estate agent is the connection to the inside world of real estate. Yes, the Internet can provide you with lots of information, but it can't replace a knowledgeable real estate agent.
Finding the best agent who meets your needs is like finding a good friend. I'm not kidding. Having to work with an agent that doesn't understand your needs for housing can result in endless headaches, but working with an expert in the industry takes away the worry and stress, and streamlines the process.
It can be a jungle out there. Navigating through the foreclosures, short sales, and excessive inventory can make some buyers feel overwhelmed. The result? They continue to rent!
If you have the right team of experts surrounding you and looking out for your best interest, you're not afraid to aim high and go after exactly what you want. An agent isn't your cheerleader but is there to help you get precisely what you want and the best deal possible.
The agent has a fiduciary duty to you–to provide trust and confidence. Up to now, we've talked mostly about an agent–a person licensed to sell real estate but is that the same as a REALTOR®? The answer is no. And since the terms are often confused, it's worth taking a moment to explain how the National Association of REALTORS® (NAR) defines them.
Both are licensed to sell real estate but REALTORS® are members of the National Association of REALTORS® and are required to follow the REALTOR® Code of Ethics. According to NAR, there are 17 articles in the Code of Ethics and they are strictly enforced.
Here's what is stated in the 2011, Code of Ethics and Standards of Practice from NAR, "The term Realtor® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal."
Whether you hire a real estate agent or a REALTOR®, the most important thing you can do is research their background, reputation in the market, and get references. This is likely the biggest financial move you'll make, so taking the time to find information about the agent or REALTOR® you're about to hire is a wise investment.
Visiting real estate offices and meeting with their staff is another good way to explore who will fit with your personality and match your needs. Contacting friends for referrals is a good start, but don't just hire your friend's agent or REALTOR® because the real estate transaction worked out for your friend. Spend a little time to effectively communicate your needs, goals, and desires, and then listen carefully to how the agent or REALTOR® responds.
It may not be a marriage but it's certainly a relationship that could last a lifetime, creating a successful financial situation for all.
Many buyers will go it alone. They hit the Internet for their first line of attack in house hunting. They peruse magazines and open houses. But they miss an important key player in their house-hunting mission–the real estate agent.
The real estate agent is not a go-between paper shuffler. Your real estate agent is the connection to the inside world of real estate. Yes, the Internet can provide you with lots of information, but it can't replace a knowledgeable real estate agent.
Finding the best agent who meets your needs is like finding a good friend. I'm not kidding. Having to work with an agent that doesn't understand your needs for housing can result in endless headaches, but working with an expert in the industry takes away the worry and stress, and streamlines the process.
It can be a jungle out there. Navigating through the foreclosures, short sales, and excessive inventory can make some buyers feel overwhelmed. The result? They continue to rent!
If you have the right team of experts surrounding you and looking out for your best interest, you're not afraid to aim high and go after exactly what you want. An agent isn't your cheerleader but is there to help you get precisely what you want and the best deal possible.
The agent has a fiduciary duty to you–to provide trust and confidence. Up to now, we've talked mostly about an agent–a person licensed to sell real estate but is that the same as a REALTOR®? The answer is no. And since the terms are often confused, it's worth taking a moment to explain how the National Association of REALTORS® (NAR) defines them.
Both are licensed to sell real estate but REALTORS® are members of the National Association of REALTORS® and are required to follow the REALTOR® Code of Ethics. According to NAR, there are 17 articles in the Code of Ethics and they are strictly enforced.
Here's what is stated in the 2011, Code of Ethics and Standards of Practice from NAR, "The term Realtor® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal."
Whether you hire a real estate agent or a REALTOR®, the most important thing you can do is research their background, reputation in the market, and get references. This is likely the biggest financial move you'll make, so taking the time to find information about the agent or REALTOR® you're about to hire is a wise investment.
Visiting real estate offices and meeting with their staff is another good way to explore who will fit with your personality and match your needs. Contacting friends for referrals is a good start, but don't just hire your friend's agent or REALTOR® because the real estate transaction worked out for your friend. Spend a little time to effectively communicate your needs, goals, and desires, and then listen carefully to how the agent or REALTOR® responds.
It may not be a marriage but it's certainly a relationship that could last a lifetime, creating a successful financial situation for all.
Reduce, Reuse, and Recycle Your Closet
It's really no secret. We are a nation of consumers. Watch television for just one evening and you'll know of a dozen sales and promotions happening in your local area. Whether it's retail or sale, there are more than a handful of us that have consumed our ways to a stuffed closet.
Call it early Spring cleaning. Call it a simplification. Organizing and cleaning out your closet can be a great selling tip, because buyers do and will open your closet during a walk-through. And one stuffed to the rafters will appear small and cramped, no matter it's real size.
There is, however, the altruistic side. Today there is an unemployment rate of nearly 10 percent. This translates into around 15 million unemployed Americans. That is why it is important to lend a helping hand to members of your community. Unemployed families still need clothes, even after the paychecks stop.
Reduce:
Consider what it is that you really need. Do you have clothes that don't fit? How about clothes and shoes that you really don't need? Are there items that aren't your "style" anymore?
Many of us like to hold onto clothes that we think we might wear again. But use this rule of thumb. If you haven't worn it in the last year, then it is time to donate.
Reuse:
Resist the urge to refill your closet once you've downsized! "But what about that new pair of boots I've been eyeing?" you say. Find creative ways to reuse items you have already bought. You may be surprised at how much variety you have in your closet when you rely on what you already have. And for those green activists out there, the fewer new items you buy, the less you consume. Every item that is manufactured takes a toll on the economy, through the power used to run the factories, chemicals and oil used to create certain fabrics, and even the gas it takes to ship items to the store.
Recycle:
Start locally. Do you have relatives or friends who would welcome children's clothes? Kids grow fast and many families are struggling to afford bigger sizes. Most communities have local thrift, Goodwill, or Salvation Army stores that will gladly take your donations.
There's also a great site called thredup.com that allows you to exchange kids clothes with families from all across the country. Traders can get a box of clothes for only the cost of shipping at $5.
Adults need donations, as well. Job interviews and changing seasons may put many adults at a disadvantage. Donation means your old piece of clothing can be given a new home.
Cleaning out your closets is a winning situation. It's good for the community, good for sellers, and of course, it's good for the environment! So start your closet on a reduce, reuse, recycle diet today!
Call it early Spring cleaning. Call it a simplification. Organizing and cleaning out your closet can be a great selling tip, because buyers do and will open your closet during a walk-through. And one stuffed to the rafters will appear small and cramped, no matter it's real size.
There is, however, the altruistic side. Today there is an unemployment rate of nearly 10 percent. This translates into around 15 million unemployed Americans. That is why it is important to lend a helping hand to members of your community. Unemployed families still need clothes, even after the paychecks stop.
Reduce:
Consider what it is that you really need. Do you have clothes that don't fit? How about clothes and shoes that you really don't need? Are there items that aren't your "style" anymore?
Many of us like to hold onto clothes that we think we might wear again. But use this rule of thumb. If you haven't worn it in the last year, then it is time to donate.
Reuse:
Resist the urge to refill your closet once you've downsized! "But what about that new pair of boots I've been eyeing?" you say. Find creative ways to reuse items you have already bought. You may be surprised at how much variety you have in your closet when you rely on what you already have. And for those green activists out there, the fewer new items you buy, the less you consume. Every item that is manufactured takes a toll on the economy, through the power used to run the factories, chemicals and oil used to create certain fabrics, and even the gas it takes to ship items to the store.
Recycle:
Start locally. Do you have relatives or friends who would welcome children's clothes? Kids grow fast and many families are struggling to afford bigger sizes. Most communities have local thrift, Goodwill, or Salvation Army stores that will gladly take your donations.
There's also a great site called thredup.com that allows you to exchange kids clothes with families from all across the country. Traders can get a box of clothes for only the cost of shipping at $5.
Adults need donations, as well. Job interviews and changing seasons may put many adults at a disadvantage. Donation means your old piece of clothing can be given a new home.
Cleaning out your closets is a winning situation. It's good for the community, good for sellers, and of course, it's good for the environment! So start your closet on a reduce, reuse, recycle diet today!
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