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Florida’s existing home, condo sales up in May 2009

ORLANDO, Fla. – June 23, 2009 – Florida’s existing home sales rose in May – the ninth month in a row that sales activity increased in the year-to-year comparison, according to the latest housin May existing-home sales continue rising trend, says NAR
g data released by the Florida Association of Realtors® (FAR). Statewide sales showed gains over the previous month’s sales level in both the existing home and existing condominium markets. Also, for the first time in many months, the statewide median sales price in May for existing homes and for existing condos rose over the previous month’s figure.

Existing home sales rose 16 percent last month with a total of 13,921 homes sold statewide compared to 12,044 homes sold in May 2008, according to FAR. Statewide existing home sales in May increased 6.2 percent over April’s statewide activity. Florida Realtors also reported a 21 percent rise in statewide sales of existing condos in May; existing condo sales last month rose 3.8 percent over the total units sold in April.

“The improving sales of existing single family homes and condos is a trend we have been seeing for several months in Florida. What is new in this month’s data release is that we are seeing evidence of prices beginning to firm,” says Dr. Sean Snaith, director for the University of Central Florida’s Institute for Economic Competitiveness. “While one month of data does not a trend make, it is the first green shoot we have seen in some time as far as prices are concerned. Until prices stop declining, we cannot state with confidence that the housing market has stabilized. Sales have risen to levels we have not seen since 2006, though the economy still faces headwinds. As credit markets begin to thaw this will help speed along this process of recovery in the housing market.”

Thirteen of Florida’s metropolitan statistical areas (MSAs) reported increased existing-home sales in May and 13 MSAs also showed gains in condo sales. A majority of the state’s MSAs have reported increased sales for 11 consecutive months.

Florida’s median sales price for existing homes last month was $144,400; a year ago, it was $203,800 for a 29 percent decrease. However, the statewide existing home median price in May was higher than the statewide median price reported in each of the previous four months. According to housing industry analysts with the National Association of Realtors® (NAR), sales of foreclosures and other distressed properties continue to lower the median price because they generally sell at a discount relative to traditional homes. The median is the midpoint; half the homes sold for more, half for less.

The national median sales price for existing single-family homes in April 2009 was $169,800, down 14.9 percent from a year earlier, according to NAR. In California, the statewide median resales price was $256,700 in April; in Massachusetts, it was $275,000; in Maryland, it was $255,587; and in New York, it was $185,000.

According to NAR’s latest housing industry outlook, buyers are responding to favorable market conditions. “The $8,000 first-time buyer tax credit is beginning to impact the market,” said NAR Chief Economist Lawrence Yun. “Since first-time buyers must finalize their purchase by Nov. 30 to get the credit, we expect greater activity in the months ahead and that should spark more sales by repeat buyers.” Many homebuyers are taking advantage of the bargain prices offered on foreclosed listings in states like Florida, California and Nevada, Yun noted, which should “set the stage for healthy market conditions going forward.”

In Florida’s year-to-year comparison for condos, 4,839 units sold statewide compared to 3,998 units in May 2008 for a 21 percent increase. The statewide existing condo median sales price last month was $113,400; in May 2008 it was $181,700 for a 38 percent decrease. May’s statewide existing condo median price was the same as January’s statewide median, and was higher than the median reported in February, March or April. The national median existing condo price was $173,900 in April 2009, according to NAR.

Interest rates for a 30-year fixed-rate mortgage averaged 4.86 percent last month, down significantly from the average rate of 6.04 percent in May 2008, according to Freddie Mac. FAR’s sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.

Among the state’s smaller markets, the Melbourne-Titusville-Palm Bay MSA reported a total of 584 homes sold in May compared to 491 homes a year ago for a 19 percent increase. The existing home median sales price was $123,700; a year ago, it was $163,100 for a 24 percent decrease. In the year-to-year comparison for the existing condo market, 123 units sold in the MSA last month, up 6 percent compared to 116 condos sold the previous May. The market’s existing condo median price last month was $134,400; a year earlier, it was $144,300 for a 7 percent decrease.

© 2009 FLORIDA ASSOCIATION OF REALTORS

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Young homeowners gain despite stagnant economy

ST. LOUIS, Mo. – June 15, 2009 – If the real estate bust has a bright side, it’s this: People like Lilly Thomas, Stephanie Driskell and Dexter Wuller can finally afford homes.

Falling home prices and an $8,000 federal tax credit are putting homes in reach of young people who couldn’t afford them a few years ago. As a result, real estate agents say starter homes are the only part of the real estate market that’s showing some life.

It’s not a lot of life. House sales this year are down by a third from the boom year of 2006, and the bust spans all price classes. But the lower end of the market – houses priced under $200,000 – is suffering less, and there’s some evidence that a comeback could be beginning.

Now, real estate agents are starting to worry that rising mortgage interest rates may dampen buyers’ enthusiasm. Rates on 30-year mortgages jumped to an average of 5.59 percent last week, up from 4.84 percent a month ago. Meanwhile, many FHA lenders have raised their credit score requirements to 620 from 580, which will seal some people out of the home market.

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First-time buyers – A hot market segment

Historically low interest rates. Attractive home prices. Impressive inventory. And now an $8,000 tax credit for first-time buyers that can be used as a downpayment on a home.

What’s not to love about this unique scenario for first-time homebuyers in Florida? It’s no wonder this demographic is growing monthly.

Let’s look closer at why the first-time buyer market is so strong:

1. $8,000 tax credit. It’s hard to say “No” to free money, and that’s basically what the federal government is offering with very few strings attached.  Better yet, the money can be used as a downpayment, thanks to FAR’s efforts to pass legislation in Tallahassee in April. 

2. Other government incentives. The 2009 American Recovery and Reinvestment Act opens doors to affordable homeownership to people who had not been able to qualify for loans or hand over large downpayments.    

3. Interest rates. Hovering around 5 percent, this means monthly payments are less than even last year for the same home.

4. A buyer’s market inventory. Nothing needs to be explained here. Everyone wants options and choices when making the most expensive purchase of a lifetime.

5. Price. Florida’s median sales price for existing homes in March 2009 was $141,300; a year ago, it was $201,700. Do the math.

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Mortgage rates above 5% for 1st time in 3 months

WASHINGTON – June 5, 2009 – Rates on 30-year home loans surged above 5 percent for the first time in nearly three months this week as investors pushed up rates on long-term government debt, which is closely tied to mortgage rates.

Mortgage finance giant Freddie Mac said Thursday that average rates on 30-year fixed-rate mortgages rose to 5.29 percent this week, from an average of 4.91 percent a week earlier. It was the highest weekly average in nearly six months.

Mortgage rates “caught up to the recent rise in long-term bond yields this week,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

The jump in rates came after the yield on the benchmark 10-year Treasury note, a barometer for interest rates on mortgages and other loans, jumped last week to a six-month high of 3.75 percent. But yields on long-term Treasury debt have since edged back downward following lackluster economic reports.

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(New Home Sales are Rising & Prospective Buyers Flock to “Sales Centers” in New Communities. New Construction is the One Niche of the Market that Competes Very Well with Foreclosure & Short Sale Pricing.. Plus, Newer & Never Lived-In is Very Desirable!)

Homebuilders tout signs of housing market thaw

LOS ANGELES – June 4, 2009 – Homebuilders across the country say they are finally seeing signs the three-year housing downturn is ending.

This week, both Toll Brothers Inc. and Hovnanian Enterprises Inc. were the latest builders to report smaller quarterly losses, rosier sales trends and more prospective buyers visiting model homes.

Toll said Wednesday it has seen an increase in homebuyers putting down deposits during nine of the past 11 weeks, compared to weekly figures from fiscal 2008.

“In the last couple of weeks, which on a seasonal basis should stink, we do see fewer (contract) cancellations coming in than we would have normally expected,” said Robert Toll, chief executive officer.

None of them, however, is ready to jinx it by calling the bottom. They say the recession and fear of job losses are keeping many would-be homebuyers on the fence.

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FAR study looks at Florida’s present and future

TALLAHASSEE, Fla. – June 3, 2009 – Migration – the movement of people into and out of a geographic area – impacts a state’s economy and real estate market. Because birth and death rates are usually low and stable, migration often accounts for the largest changes in population growth, decline and redistribution.

Migration patterns have a big impact on real estate professionals, and Florida has one of the greatest levels of domestic migration. Florida’s total population was 18.3 million in 2008, and, according to the Census Bureau estimates, will reach 19.3 million by July 2010, and approximately 23.4 million by 2020. The Census Bureau estimates a 79 percent increase in total population between 2000 and 2030, ranking Florida third highest in projected population growth.

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(Above is a Nice Visual of the Short Sale Process.. Owner owes $200,000 on Home.. Property is Worth $125,000.. Seller Finds Buyer, & Writes Purchase Contract for $125,000 & Asks the Bank to Absorb the Deficiency & Release Seller From the Debt.. This Can be  a 3-8-month Process, but Realtors are Trying to Speed it Up..)

Real estate pros push for better short sales

LONG ISLAND, N.Y. – May 11, 2009 – As anybody who has dealt with one knows, short sales should be renamed “long sales.” But that could be changing.

One of the real estate professionals leading the charge to revamp the short-sale process is George K. Wonica, owner of Wonica Real Estate & Appraisals on Long Island, N.Y., and chair of the National Association of Realtors® Conventional Finance and Lending Committee.

Wonica already has met with 10 mortgage bankers and servicers in Florida to address the problem, and plans a similar meeting this summer in Las Vegas. He points to the uniform short-sale form developed by the California Association of Realtors as an example of what the industry needs.

Short sales appear to be good for both banks and buyers. A study by Connecticut-based Clayton Holdings Inc. showed lenders from May to October 2008 lost an average 37 percent through short sales versus 56 percent on homes sold after foreclosure.

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Federal program to help first-time buyers use tax credit for downpayment

 Confused about the first-time buyer benefits?

Two programs will allow first-time buyers (those who have not owned a home for at least three years) to use their income tax credit toward a downpayment. Neither the Florida program nor the HUD program has been fully fleshed out, however, and it’s unclear how soon money will become available under either program.

WASHINGTON – May 13, 2009 – First-time homebuyers will soon have another option if they want to use their $8,000 tax credit toward a downpayment. On the tails of a Florida-created program that Gov. Charlie Crist is expected to sign into law, the federal government announced its own downpayment assistance program at the National Association of Realtors® Midyear Legislative Meetings & Trade Expo taking place this week in Washington, D.C.

While the tax credit applies to “first-time homebuyers,” the term is misleading. In general, anyone who hasn’t owned a home for the past three years is considered a first-timer under the program. Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development (HUD), hopes to have additional details available within a few days, though it’s still unclear how soon homebuyers can apply for the credit.

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Florida’s existing home, condo sales rise in 1Q 2009

ORLANDO, Fla. – May 12, 2009 – Sales of existing single-family homes in Florida rose 25 percent in first quarter 2009 compared to the same period a year earlier, according to the latest housing statistics from the Florida Association of Realtors® (FAR). A total of 31,412 existing homes sold statewide in 1Q 2009; during the same period the year before, a total of 25,071 existing homes sold. It marks the third consecutive quarter that Florida has reported higher existing home sales; sales levels in the third and fourth quarters of 2008 were higher than the corresponding three-month period of the previous year, according to FAR.

Sales of existing condominiums statewide in the first quarter rose 19 percent compared to the same time the previous year. This marks the second three-month period for increased statewide sales in both the existing home and condo markets compared to year-ago levels.

Statewide sales activity in 1Q 2009 also increased over 4Q 2008’s sales figure in both the existing home and existing condo markets, FAR records show. For 1Q 2009, statewide sales of existing homes rose 4.14 percent over the 4Q 2008 figure; existing condo sales statewide in 1Q 2009 increased 21.1 percent over the 4Q 2008 level.

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(Florida Plays Host to One of the Most Desirable Places in America to “Tie the Knot”. Weddings Mean.. Romance, Paradise, Beauty, Love, Fun, & Relaxing.. It’s Interesting the Same Words To Describe Wedding, Describe Quality of Life in the Sunshine State..)

Prospects for Florida’s recovery heat up, economists say

TALLAHASSEE, Fla. – May 5, 2009 – After two long years of recession, economists are beginning to see signs that the economy’s recovery is finally in sight. South Florida home sales are picking up, Wall Street has staged some solid rallies and even consumer confidence is rising.

But the road to recovery will be uneven. Economists say that an uptick in business spending will lead the way, followed by federal government stimulus projects that will create some jobs. Consumers, unfortunately, are likely to be the last to see good times return, because widespread unemployment – which is now just a notch below 10 percent – won’t start to go down until after the recovery is well under way.

It has been rough, but economists say it’s always that way for Florida.

“It performs better in good times, but during bad times, in recessions, it is one of the worst performing states in the nation,” said Moody’s Economy.com economist Chris Lafakis. “And during times of expansion it is one of the best.”

Some experts say they already see the early signs of such progress.

“The negative numbers just start getting smaller or they stop falling or they fall at a slower rate,” said SunTrust Chief Economist Gregory Miller. It’s like you tumbled out of a boat a while ago and “now we’re at the stage of swimming back to the surface.”

Other economists agree that the worst may be over as soon as this summer. Consumers surely have had enough, judging by the strong jump in Floridians’ consumer confidence this month.

Here’s how economists say the state will find its way out of the slump:

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