On July 1, 1973 the Current Use Law became effective in New Hampshire. The Current Use law was designed to keep New Hampshire’s rural character in tact while allowing owner’s to use the land quoting from the preamble to the law itself: “It is hereby declared to be in the public interest to encourage preservation of open space, thus providing a healthful and attractive outdoor environment for work and recreation of the state’s citizen’s, maintaining the character of the state’s landscape, and conserving the land, water, forest, agricultural and wildlife resources.”
The effect of the Current Use law has been to provide a lower tax rate on larger tracts of land so that property owners would not be forced to subdivide and sell off their property in order to cope with large property tax bills. By keeping land in an undeveloped condition family farms have been preserved as well as woodlands, wet lands and other tracts that might well have been lost over the last thirty-nine years.
Over half on the land in New Hampshireis enrolled in the Current Use program and it has been the foundation of the State of New Hampshireprivate property based land conservation program.
The following are characteristics of the State of New Hampshire’s Current Use Program:
Generally speaking a parcel must be of at least ten acres, exceptions to this are wetlands of any size, tree farms of any size and parcels of less than ten acres that produce more than $2,500 in agricultural products. Open undeveloped land that is less than ten acres as well as any area covered by buildings does not qualify for Current Use.
If an owner acquires abutting parcels of less than ten acres the additional parcels can be added and would qualify for Current Use or if an owner has a number of abutting parcels of less than ten acres each but the entire contiguous amount owned is ten or more acres then the property is eligible for Current Use.
What is a contiguous parcel? Contiguous parcels under the Current Use Law are defined by the NHSPACE.org website as “more than one parcel of land, which is connected, even if a highway, rail bed, river or water body divides it. This means land that touches any of your property boundaries, or is across the road or on the other side of a pond, stream or river, on both sides of railroad tracks, or across a political boundary.”
If a property owner enrolls his property in Current Use it does not mean his land is now “Open to the Public”. When a property owner enrolls his property in Current Use it is still private property – remember the focus of this law has been keeping New Hampshirelarge undeveloped tracts in private hands – the property owner still has the right to determine how his property will be used just as he would if it were not in Current Use.
For more details on New Hampshire’s Current Use Law visit NHSPACE.org
By Dick Thackston CRB, ABR, ABRM
Broker NH, MA & VT
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By Dick Thackston
2012 is likely to be defined, in the real estate world, by three “E’s”: Expectations, Employment and Europe/Economy. No matter what your political belief system is, no matter how much or how little money you have, these three factors will permeate American life and the economy more than any others in the next eleven and a half months.
Expectations: In the world of sales there is an old truism, “To live with the classes sell to the masses!” those will be the watch words for real estate this year. 2012’s real estate will almost certainly only be about first time buyers and large volumes of REO properties being sold to investors. Both first time buyers and investors have some striking similarities: both groups feel they are buying at the bottom of the market and both groups have an expectation of housing prices increasing over the next three to five years and both groups have an expectation of rents remaining and going higher. (Personally, I agree with both groups.) First time buyers not only have the family formation/nesting instinct driving them into purchasing, but they have the ever increasing cost of renting versus home ownership. Most first time home buyers are renters now and are looking at homes that will have monthly mortgage payments 15-20% below their current rent. Landlords/Investors are looking at the exact same equation from the other side and seeing that almost anything they buy now will have positive cash flow of at least 10% and often up to 20%. The group that is melting away at this time is the investors looking to buy, fix and flip, the risks are too great of carrying a vacant property or over improving and taking a hit in what is in fact a flat market, and of course move-up buyer’s remain effectively locked out of the market for the foreseeable future. Until move up buyers can sell and move there is likely to be no updraft in the real estate market, but when it does begin it will be huge.
Employment: In New Hampshirefor sure, the Northeast in general and for the nation probably, employment getting better.New Hampshire has experienced job creation. Not dramatic but some. GivenNew Hampshire’s favorable tax and business environment it’s not really surprising that it would be one of the first parts of the country to recover. New England more generally seems to be getting better although not at the same rate as New Hampshireand the nation, well let’s face it would be hard to screw things up much more – which is a perverse kind of improvement actually. So as workers become more secure in their outlook on employment, they become more confident that they can cope with a mortgage payment and the other cost associated with home ownership, and are feeling much better about leaving their apartments and Mom’s basement. This is having a very noticeable effect on stabilizing the market at the bottom.
Economy: The macro-economic environment remains dicey. I almost headed this section “Europe” as my third “E” but really it’s bigger than all that. The United Sates is no longer insulated from the rest of the world economically. I doubt that this was ever really true, but we felt it was true and we certainly acted as if it was true. The United States remains the world’s largest economy however it remains subject to outside shocks: Tsunami & nuclear disaster in Japan, economic slowdown in China and most dramatically European debit crisis – country by country bad news out of Europe send shocks through our financial system and impacts our banking sector. The largest of these in public perception is Europe which is unlikely to be resolved anytime soon and will continue to drag on the world economy. China seems to have better managed its financial affairs – easier in a totalitarian state – and seems likely to have a softer economic landing than Europe.
What’s the take away from all this? Housing is stabilizing now; sales volume is likely to increase significantly; good deals from a buyer’s perspective are likely to remain the norm for the next eight to twelve months; no real appreciation in real estate as an asset class is likely and value added efforts for renovations will remain high risk till after the end of 2012.
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WHAT’S REAL ESTATE GONNA BE LIKE IN 2012? By Dick Thackston CRB, ABR, ABRM, Broker NH, MA & VT
2012 is looking like it’s shaping up to be the year of the buyer. The winter months so far here in the Northeast have been unusually busy with buyers poking around virtually ever listing – mind you it has not been hundreds or even dozens of buyers coming out to Open House like in the mid 2000’s but there’s been plenty of action. Over the holiday week virtually every REO listing I have has had one or more showings.
Conventional wisdom says that the buyers are going to remain primarily investors and first time buyers.
The investors were out in force in the month of December probing banks and making low offers hoping that banks would take massive price hits to get properties off their books and closed by 12.31.11. I don’t know of any of these offers that went anywhere, clearly these investors do not understand the obligations or objectives of asset manager’s or company’s working out REO inventory on behalf of investors. The truth is that it costs very little to hold a property and with rare exception the REO assets are priced to the market and there is NO incentive for REO assets to be dumped just because it’s the end of the year. As a practical matter most lenders run on fiscal years that don’t end on 12.31 so it’s just another day – many do not even use natural quarters of the year for the end of their businesses. That being said many excellent transactions were originated in the month that were great opportunities in the medium and long time frames. I had one experienced investor come into my office and talk for about forty-five minutes today about how he has changed his strategy to conform to the current climate. Now mind you this man has been buying, selling and building houses in this region for over thirty years. Traditionally he has picked up land and renovation projects in the down turns and built new homes or renovated and flipped, but he has changed his tack for now. He can’t build profitably and doesn’t want to “build for practice” so he’s banking land assets and buying moderately poor condition homes and stabilizing them with the plan of renting them out. I asked him how many did he plan on doing and he said he’s done nine clean-up and rent outs in the last six months of 2011. His business model is to acquire single family homes and renovate for a total of $75,000 or less which gives him about a 20% gross return based upon is average rent of $1,200. Not bad when you look at your other investment alternatives.
First time buyers are also out in force. They are of course first time buyers and have lots of information, most of which is bad, and lots of input from family, most of whom know less than the first time buyers. These folks are getting transactions together and they are closing, but it is very painful for them because regardless of the input from REALTORS who are actually trained as a buyer’s representative, (like me I am both an Accredited Buyer’s Representative and an Accredited Buyer’s Representative Manager through the National Association of REALTORS), they tend to listen to friends and family who bought homes at sometime in the past, and this is definitely not your Uncle Louie’s real estate market. Big changes for buyers are that no REO Manager will consider an offer that doesn’t have a high quality pre-qualification letter along with it – these REO managers don’t do wishful thinking, they want to know that the buyer can perform or they won’t consider tying up inventory. Other big changes are that when the REO contracts are accepted and they call for closing by a specific date there are penalties to the buyers for not closing on time or not completing inspections on time. The REO managers aren’t kidding when they say as is where is and close on time – this is very different from what most buyers came to expect in the last few years of the real estate boom. Most sellers and their agents became really flexible on dates and repairs because they knew intuitively no mater what the buyer wanted they were still making a killing on their property: that would not be the REO market – no matter what the REO’s are loosing money for the investors behind them and they are tremendous opportunities for the buyers who will live in them for a period of years and pay down there loans and sell later in a better time.
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By Dick Thackston CRB, ABRM, ABR
Since the down turn started in the third quarter of 2005, (yes that’s right it’s actually been over six years if your benchmark is real estate brokerage), and the economic seizures started happening almost daily after November 2008, I’ve actually had some excellent experiences helping sellers and lenders work out a short sale.
Initially mortgage lenders were less likely to work out a short sale for a number of reasons: they didn’t believe the property was upside down, mortgage insurance would cover their losses if it went to foreclosure and/or they were simply too overwhelmed with the volume of business collapse that they couldn’t function efficiently and make decisions.
In 2007 I began the process of helping people work out a Short Sales on their homes if they were over mortgaged. One of the most successful short sales I’ve done was a house inKeene,New Hampshire. The owner had purchased the home about twenty years before he called me. He had tried selling the home himself and tried a Virtual Real Estate brokerage from outside the area with no local support. All the time he tried this, his home was sinking in value.
Why, one might wonder, if he had owned this home for over twenty years would he owe more than he paid? Well, actually what he had done was borrow money incrementally over the years to put his children through collage and purchase each of them cars when they graduated. He literally used his home as a savings account.
The biggest hurdle in the transaction was the owner, he just couldn’t believe that his home would be worth the loan balances plus and additional ten thousand dollars so that he could start his life over again someplace else. Once I was able to get him to understand that the value just wasn’t there, and he agreed to price the house to the market comparable prices in his neighborhood at the time, we got some OK sales traffic and ultimately an offer. I presented the offer to both the owner and his lender. I obtained the owners detailed financial information and the bank agreed to accept the short sale. Little or no emotion, very rational, and very efficient successful transaction.
The entire transaction from day of listing to day of closing the short sale, including negotiating with lender, was about five months or one hundred fifty days to closing.
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The Great Recession that has shaken the American Economy and Housing Market over the last five years has taken many would be home buyers out of the market and loaded the Home Buyer psyche with skepticism however it has not generated an increase in the demand for buyer brokers. In fact if anything the willingness of buyers to contract with Buyer Brokers appears to be in decline and the willingness of agents and agencies to provide buyer brokerage services appears to have declined.
Buyer Brokerage, properly understood by the consumer and properly handled by the Buyer Broker is an excellent program and an excellent service for any home buyer in today’s market.
The top ten things when getting involved in Buyer Brokerage follow:
# 1. Find a Buyer Broker that you feel you can know like and trust. This person is going to need to have both your attention and confidence. Remember you’re not hiring them to be your best friend you’re hiring them to help you make solid business decisions.
# 2. Understand that you are HIRING the Buyer Broker which means you will be responsible for PAYING the Buyer Broker. Most agents will be happy to accept as compensation whatever fee is offered through their local MLS however sometimes listing brokers will not pay a fee or will not pay a reasonable fee and it will be your responsibility to handle this cost. Discuss this in detail when you hire the Buyer Broker.
#3. ONLY HIRE A BUYER BROKER WITH TRAINING IN BUYER BROKERAGE. Lots of agents and agencies will agree to be paid as a buyer broker but very few have actually training in Buyer Brokerage. The top level of training for a Buyer Broker is an Accredited Buyer Representative Manager a designation offered exclusively through the National Association of Realtors, Real Estate Buyer Agent Council.
#4. Have some idea of what you want and were you want to live. It’s the Buyer Broker’s job to help you figure out the best value for you but you need to understand your own needs and wants so the Buyer Broker can help you figure things out.
#5. Listen to the Buyer Broker. Most Buyer Brokers can send you to good service providers: Loan Officer’s, Title Companies, Home Inspectors etc and do so to help you get good service – no other reason, really.
#6. Find out if your chosen Buyer Broker requires a retainer and how that’s handled. Many Buyer Broker’s require a retainer when you contract for services. Most refund that after a successful closing, some do not establish how this item is handled when you sign your contract.
#7. Establish the level of service you expect and the level of service your Buyer Broker is ready willing and able to provide. Some buyer brokers will check zoning, building permits and title issues; some will not work with For Sale by Owner and non-MLS listings be clear about how these issues are handled.
#8. Establish an exit plan. Sometimes relationships just don’t work out or sometimes your situation will just change. Be clear at the beginning of your relationship with the Buyer Broker how things can be ended if you don’t feel the relationship is working out.
#9. Understand the agency laws in your state. Every state has different rules governing the actions and relationships of the real estate agents with the public – no two are exactly the same.
#10. Make sure you know who the boss is. When contracting any licensed professional for services make sure you know who they report to and who regulates Buyer Brokerage in your state. There is NO STATE where Buyer Brokerage is regulated by the REALTORS.
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By Dick Thackston
Whether the US Economy is entering or has entered a double dip is a hard call and seems less than clear to most of us. Remember as President Nixon famously said over forty years ago: “Unemployment’s a matter of perspective which mostly depends on whether you’re working or not.”
Happily, New Hampshire and Vermont are among the most economically successful states in the country at this time. New Hampshire gained approximately 12,000 jobs from the peak of unemployment and Vermont has gained 5,700 in the same time frame. To be sure both states still have a net loss since 2008 however both states show that they are making the long crawl back from the bottom. New Hampshire’s economy is outperforming the US economy overall by adding jobs faster which has lead to increasing income and spending and our lower unemployment and is likely to do so in the foreseeable future according to most Economists.
So where’s housing?
Why aren’t prices stable and buyer’s buying at such low interest rates?
House prices have fallen about 20% overall in New Hampshire: more in the poorer areas and on poor quality properties and less in the wealthier areas and better quality properties. The number of homes available for sale in New Hampshirehas ranged from twelve to sixteen months worth of inventory over the last three years and seems to remain in that range.
Why is that?
If homes are selling at some pace why can’t we get ahead and drive the amount of inventory down to a more manageable backlog and generate some appreciation and good news? There are several critical factors: consumer age, nature of inventory, consumer confidence and banking regulation.
Since the year 2000 the populations of New HampshireandVermonthave seen their highest growth rate in the categories ages 55-64 and 65+. This seems to be driven by two major dynamics. The low rate of economic growth means younger families are not as attracted to the region as they might be to other more dynamic regions and the tax climate is very favorable to wealthier households that tend to be older. Older consumers tend to not spend as much in general and tend to not be as mobile in housing. They tend to stay put reducing the velocity of sales in the region.
The inventory of available homes in our region tends to be of poor quality over all – to be sure there are many fine homes in excellent condition available – which generate little or no interest in housing consumers of any demographic. During the housing bubble these homes sold at unreasonable high prices because they might be the only property available to many consumers most of whom might have been better off without the property. Many of these properties have no future and this is the range where we see sales in the region in the < $50,000 range. The prices often reflect lot cost minus the price of removing existing structures. Even at that low price level there is very limited demand and these properties are likely to remain a glut on the market statistically for years not months.
Consumer confidence remains weak. If economic uncertainty is to remain the ruling dynamic for the foreseeable future is it any wonder that household savings is likely to continue increase dynamically? Is it any wonder that large corporations are mimicking households as a rule and holding on to large amounts of cash at a time when lending is not guaranteed to be available to even the most qualified of borrowers?
Banks have positive economic incentives to hold up foreclosures and release them onto the market slowly. The longer banks hold delinquent properties off the market the longer they can put off recognizing losses so they look better to both regulators and investors but more significantly they aren’t forced to compete with themselves and there is an increasing trend among lenders to work out short sales with their delinquent accounts. Most industry analysts in the mortgage banking industry expect a surge in short sales in the next twelve to eighteen months. Shortsales reduce lender losses by so estimates as much as $50,000 per property and is far better from a public relations point of view with the consumer that has is over mortgaged.
So what’s the best plan for the average consumer at this time? For seller’s it’s simple: be realistic about your price; if you’re over mortgaged select a REALTOR with success handling short sales and begin working with your lender early in the process. This is likely to allow you to obtain the best terms from both your lender and the home buying public. For buyer’s it’s more complicated: understand what you really want and can afford; get pre-approved by a lender early in the process – bank owned properties and shortsales won’t normally consider any offer from a buyer that can’t produce a pre-approval from a lender with a contract; and most importantly understand that the really inexpensive properties are mostly trash and will not be financeable – there are no free lunches in housing!
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By Dick Thackston
Distressed properties are the biggest part of the real estate business today. Of the distressed properties that are on the market and selling now the majority are not bank owned REO properties rather the majority of distressed properties on the market and selling today are “Short Sales”. Short sales are properties where the home owner owes more than the current market value of the home and is attempting to sell the property and have the bank write down the loan balance on the home.
Generally, Short Sales properties are in better condition and are still financeable with normal condition than properties that have gone to foreclosure because the home owner still lives in the home and maintains it as their own. These seller’s generally are looking to maintain their credit and are just people caught in the trap created by a declining real estate market over the last five years and have to move on for one reason or another.
National data services show that 12% of all homes that closed nationwide in the second quarter of 2011 were short sales; that’s up from 10% from 10% for the same period in 2010! Effectively a 20% increase.
The reason for the increase appear to be multifold: it appears that more home owners have come to accept that their home will not increase in value without improvements in the property or the economy that are outside their ability or control and their reason’s for needing to move generally revolve around job and/or family changes as well as just a plan old need to move on.
Another major factor in this phenomenon has been banks & lenders that hold mortgages. Banks & lenders have come around 180 degrees from where they were five years ago. Five years ago very few banks & lenders would even consider a short sale, they like most home owners expected prices to maintain or recoup in a few months, but today they have come to realize increasingly that it is in their best interest to work with troubled home owners to resolve mortgages where the homeowner is upside down on the loan. To be sure this has resulted from pressure from the government in Washington as much as from market forces but overall it is good news and likely to pave the way to a more stable and prosperous housing market in the future but getting the dead weight of over mortgaged homes through the system. As an example Bank of America has announced that it expects to complete around 100,000 short sales in 2011!
The key to a successful short sale experience is consistently an agent who has the background and experience to complete a short sale it is not an easy process even now. It generates many times the paperwork and problems of any other sale. The team at R.H. Thackston & Company has been completing short sales since the Savings & Loan crisis of the early 1990’s and has the experience and knowledge to serve you in managing a distressed property sale. Since the beginning of 2011 we have completed on average 3.5 distressed property sales every month.
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By Dick Thackston
Its a buyer’s market – true – but what does that mean to you if you’re a home buyer? Are you looking to get “a great deal” and tell all your friends that you bought a house from a bank for $20,000 or are you looking to buy a home that you can live in and build equity and “have a life” over a reasonable period of time? Do you have the temperament of or for being an investor or do you not have the willingness or ability to take risks and experience losses? These are all REALLY, Really important questions you need to be able to answer if you thinking you want to play in this market.
First let’s consider what’s a good deal. Certainly you can buy a house for under $50,000. Many properties are being sold for small fractions of what they last sold for or were mortgaged for at the top of the market. DO NOT BE CONFUSED ABOUT WHAT THIS MEANS! These homes are in poor condition; most were not really qualified for the mortgages they had based upon condition but one of the characteristics of the B & C lending market of a few years ago was that they did not require homes to be up to speed. The loans were made on the hope that the borrowers would fix them up or that the housing market would inflate further or more likely both.
To buy these homes now for the most part you need lots of cash: cash to buy them and cash to renovate them. You also need to know that you may be years from getting your cash back. Normally lenders will require that your ownership and repairs be “seasoned” for at least a year before they will allow a new loan. Also, you will need to know that just because you want to make certain repairs that will “make it yours” it does not mean that you will be adding significant or any value in today’s real estate market. Roof’s, septic systems, electrical work, plumbing are all things that are expected by most home buyers to be in fair or better condition when purchasing home so you don’t get extra credit for those.
What if you miscalculate on your repairs? You eat the loss. That’s why these are called investor specials you and can win or loose. I work with several teams of investors who take on these projects. They are well capitalized and they have a plan for doing the work, they have studied each property sixteen ways from Sunday and if doesn’t look like it will work exactly as they have calculated they don’t do the deal. If your plan is to buy and work on it, will you really be prepared to live in a construction site for the next three to five years? The work always takes more time and money than the average buyer expects – even in normal times – and these are not normal times – and what typically happens is that people get bored or overwhelmed and the sell at or slightly above their costs and move on because home prices have inflated. There is no expectation that home prices will be inflating anytime soon. Most experts plan on housing to stay about where it is right now for at least another three or four years. It may get worse first.
Buying the house you want may prove to be a paradox. The value of well maintained homes has not declined as much as the averages would lead you to believe. Why, you may ask, is this? Simple if people who bought their homes in the last ten years, for all the right reasons, still have their jobs, still like their neighbors aren’t dead or getting a divorce why would they sell in this market? They don’t. Remember that in our area,Central New England, unemployment is some of the lowest in the entire country – generally under 5%.
When you hear about the million houses projected to be going to foreclosure over the next year that sounds like a big number, but remember that home sales in this country have regularly topped 5 million in the last generation, so while the number of foreclosures is huge relative to all the homes that exist in this country that are privately owned, it’s a relatively small number. The truth here is that as a country we never expected to have any significant number of homes go to foreclosure.
What does that mean for you as a home buyer in this market? It means that if you want a home now you can get a good value but you need to know who you are how, much you want to spend, and how long you want to stay in a home before you think you might need to or want to sell. Prudence is certainly important and the most important aspects of buying a home in today’s world are that you plan on using it as a house not a piggy bank and know that it’s a place to live for three or more years, maybe the rest of your life, maybe a decade, maybe till the kids are out of school. You won’t make $10,000 trouble free dollars by painting the bedrooms neutral colors and selling the house in a year.
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I want to buy land and build a house. What’s up?
By Dick Thackston CRB, ABRM, ABR
Many people that have been looking for land and been surprised to find land prices have not fallen nearly as much as residential housing if at all. Many more desirable building lots have remained unchanged in price or even increased in price a real shocker for the first time land buyer or people looking to build.
Here’s why!
First and most importantly land sales were never driven up by the mortgage lending boom over the last few years. Many people don’t realize it but land was, is and will likely remain a largely cash sale: no easy financing means, no inflation means and no deflation. To buy a building lot there are only a few avenues a buyer can take: Cash, Owner Financing or a construction loan.
Construction loans are traditionally hard to obtain and are only given to the best most qualified buyers – basically people who don’t need to borrow the money. They typically require high down payments, are interest only and balloon within six months to a year of closing. Normally before a bank will agree to make a construction loan they will require full architectural prints and bids for all phases of construction not normally what the home handyman has in mind. These loans are typically made by smaller local banks rather than larger national institutions smaller banks are under significant pressure to improve their portfolios and avoid “high risk” loans such as construction loans so they mostly don’t make them.
Once you find you land and money to buy it the next problem is materials costs. While there are certainly sales in local lumber yards and liquidators of back inventory it may be difficult or impossible to count on exactly what you need being available when you need it for new construction if that was you planned route for materials. Buying new materials for construction projects has actually never been more expense. Remember two things a piece of plywood is a piece of plywood whether it goes on a house in New Hampshire or a house in Chunking China. There’s a building boom going on in China right now sucking up much of the world’s building supplies such as lumber, copper wiring, window glass, shingles etc and driving price up!
Labor is tighter than you might think. There is plenty of unskilled labor available but licensed plumbers and electricians have laid off many of their helpers and trainees so they have maintained or even increased their costs. Most towns and cities will require that at least these two trades be licensed in a new construction project.
The greatest value and easiest projects remain renovations of lender owned properties, (REO’s). If a buyer has limited cash and time there are very favorable opportunities with REO’s which are eligible for special financing through the FHA’s 203K program. In a normal lending/home buying market lenders, REALTOR, Home Buyers and Seller’s run like the wind from the FHA’s 203K program however in today’s economic climate new rules have been implemented to make the program more viable and allow the average homebuyer up to thirty thousand dollars for post closing renovation work without bids being obtained before closing – that’s a lot of home handyman work!
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RE/MAX Predicts Increased Home Sales in Coming Months
By: Heather Hill Cernoch 10/20/2010
According to RE/MAX’s monthly National Housing Report, the housing market is attempting to return to traditional seasonal trends after a slow summer following the spring rush to qualify for the government’s homebuyer tax credit.
September sales were 6.4 percent below those in August and 20.6 percent below sales in September 2009.
RE/MAX also cites stabilization in prices due to a drop in the inventory of homes for sale.
“We anticipated the drop in home sales this summer due to the tax credit, and we usually see sales in September fall below August levels, but we’re encouraged by reports of signed contracts in the field,” said Margaret Kelly, CEO of the Denver-based RE/MAX, LLC.
“An increase in signed contract activity should translate into increased home sales in the coming months,” Kelly added.
RE/MAX attributes September’s 20 percent drop in sales from the previous year to homebuyers buying early to take advantage of the tax credit; sales in the spring were much higher than normal. Of the metro areas surveyed, only Miami reported higher September sales from a year ago with a 3.2 percent increase.
Despite the drop in transactions, September’s home prices were relatively stable with 33 metro areas showing a year-to-year increase in home sales prices. Overall, prices were down 2.7 percent from August but up 0.9 percent from a year ago. Prices are higher than 2009 in California cities and in the South and Midwest.
According to the report, the months’ supply of inventory, which indicates how long it would take to eliminate the current inventory of homes for sale at the current rate of sales, was 9.8, which is higher than the 9.1 supply reported in August and the 7.1 month supply in September 2009.
The RE/MAX National Housing Report is distributed each month and based on MLS data in approximately 54 metropolitan areas. It includes all residential property types and is not annualized. This month’s results are based on sales contracts signed in September.
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