(An excerpt from my most recent newsletter)
What’s Really Happening in the Housing Market?
During the Great Depression the primary means of reporting news was simply printed news and radio. Now we’re bombarded non stop (if we allow it) with a stream of news and communication from the time we wake to the time we hit the pillow.
TV, radio, laptops, Ipads, Blackberries, Facebook, Twitter and on and on. Instant and constant input is de rigueur. Times were pretty rugged back then. One has to ponder if communications were then what they are now if the entirety of our nation would have vaporized under the pressure.
Let’s face it, bad news sells. Times are tough and “they” love to talk about it. But you can look at the glass half empty or half full. We anticipated some consequences when the tax credit expired.
Realtors’ association economist Lawrence Yun has spoken of the current downturn, but presents another viewpoint as well. “Since May, after the April 30 deadline, contract signings have been notably lower,” he said, “and a pause period for home sales is likely to last through September.”
Still, Yun said, it’s anticipated that annual sales will approach five million in 2010 due to robust sales in the first part of the year. “To place that in perspective, annual sales averaged 4.9 million in the past 20 years, and 4.4 million over the past 30 years.”
As a result of the tax credit, there has been stabilization in home values for 18 months, Yun said.
Additionally, recently released data from the S & P/ Case-Shiller Home Price Index showed a 3.6% increase in national home prices in the last year.
"While the numbers are upbeat, other more recent data on home sales and mortgages point to fewer gains ahead," states David M. Blitzer, chairman of the Index Committee at Standard & Poor's. "Even with concerns about near term developments, we recognize that the housing market is in better shape than this time last year."
Locally, in Ventura County, we’ve experienced some slowing since the end of the tax credit. However there was actually an increase in closed sales with 4871 in the last six months over 4548 in the previous six months.
Historically low interest rates and stabilized home values make a compelling case for purchasing property at this time. The window of opportunity is there. Let me know if I can help open it!