Keller Williams Realty Atlanta – Peachtree Road

Keller Williams Realty’s Real Estate Market Update

This Month in Real Estate Video Report for U.S. Market – June 2010

Commentary:

The housing sector continues to show signs of recovery. Together the tax credit (which expired at the end of April), the more upbeat consumer confidence, and favorable market conditions all contributed to bolstering April’s sales activity – with existing home sales increasing for the second straight month.

The return of buyer confidence with much of the home price correction believed to be over, encouraging economic developments and historically low mortgage rates, will provide the stepping stone for further market stabilization.

Meanwhile, stagnant job growth and elevated levels of foreclosure continue to be cause for concern. The government is now taking proactive steps to restructure the mortgage industry with risk-management measures seen by experts as a “huge cut in red tape” that would ultimately benefit consumers.

The Housing Market:

Existing Home Sales

Existing home sales strengthened in April to 5.77 million, up 8.7% from March and 22.8%from last April. This is the tenth consecutive month of year-over-year increases.

According to Lawrence Yun, NAR chief economist, although part of the uptick was expected from the tax credit, there’s also been a return of buyer confidence, for those who remained on the sideline last year. The return of confidence is a result of stabilized prices, an improved economy, and continued advantageous interest rates.

In March, 49% of sales were from first-time buyers.

Median Home Price

The median price for an existing home was $173,100 in April, up 2.1% from a year ago and 4% from March. Distressed homes, accounting for a third of last month’s sales, continued skewing prices downward slightly as they typically are discounted 15% compared to typical home sales. Overall, prices this past year showed increased stability over the previous year.

Inventory

Total housing inventory rose slightly to 4.04 million in March, representing slightly less than an eight-and-a-half month supply of sales (if homes continue to sell at the current pace consistently and no new homes come on the market). Compared to the previous year, there are now 3% more homes on the market. Although this is the first rise in twenty consecutive months of decline when compared to the previous year, NAR’s chief economist believes this increase can be attributed to the summer selling season and that home prices are back on track.

Mortgage Rates

Mortgage rates dipped back below 5% this month due largely in part to the European debt crisis. As confidence in the value of the Euro eroded, more investors chose the U.S. dollar instead. With more demand for dollars, the cost of debt (interest rate) dropped. This event has also shown the global recovery is not free-and-clear of roadblocks to complete recovery. However, experts still anticipate rates will increase to between 6% and 6.5% by the end of the year. As the recovery gains increasing traction, the Federal Reserve will need to increase rates to prevent inflation.

Affordability

Affordability remains advantageous, supported by some of the lowest mortgage rates in decades as well as less expensive home prices. The home price-to-income ratio continues to remain well below the historical average of 25%. The ratio now stands at 14.9%.

Sources: National Association of Realtors, Freddie Mac

Government Action:

FHA Turns to Lenders to Monitor Brokers

As the Federal Housing Administration (FHA), the government agency that insures home loans, saw its market share rise to about one-third of the mortgage market last year, up from 2% in 2006, the number of brokers seeking to arrange FHA-backed loans has mushroomed to 9,043 at the end of 2009 from 5,759 just two years earlier.

The agency, finding itself inadequately equipped to monitor its brokers, is shifting the responsibility to its lenders.

The FHA expects the new policies to result in better risk management, and the cut in red tape should produce better rates for consumers.

As of May 20, the FHA no longer certifies mortgage brokers or tracks the performance of brokers’ loans. Instead, lenders are now required to sponsor brokers and assume responsibility for loans they originate, including losses from fraud or mistakes in underwriting. In addition to revamping broker insight, the agency also beefed up oversight of its lenders by increasing net-worth requirements to $1 million from $250,000. The change is in effect for one year for existing lenders.

Source: WSJ.com

Keller Williams Realty Voted ‘”Highest Satisfaction For Home Buyers Among National Full Service Real Estate Firms, Two Years in a Row!” By J.D. Power & Associates

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Keller Williams Realty Atlanta – Peachtree Road

Keller Williams Realty’s Real Estate Market Update

This Month in Real Estate Video Report for U.S. Market – May 2010

Commentary:

The economic recovery continues gaining traction slowly but steadily. First quarter GDP, the key measure of the economy, came in at a positive 3.2 percent – an indicator that we have arrived, at last, at a sustainable recovery. However, this recovery is subdued compared to previous recessions. Without a higher upswing in GDP, businesses will continue to add jobs slowly. The positive news of sustainable economic growth is tempered by the longer-than-normal time frame it will take to recoup job losses.

High unemployment and elevated levels of foreclosure and distressed homeowners continue to be two of the biggest factors in preventing a robust recovery. The government has turned its attention to matters to help bolster the economy including unemployment and financial reform. The latter is currently working its way through debate in Congress. The government’s attentive attitude toward these obstacles is seen as a positive sign by industry and economic experts.

The Housing Market:

Existing Home Sales

Existing home sales strengthened in March to 5.35 million, up 6.5 percent from February and 16 percent from last March. This is the ninth consecutive month of year-over-year increases. According to Lawrence Yun, NAR chief economist, the “home-buyer tax credit has been a resounding success,” increasing demand and stabilizing the market. In March, 44 percent of sales were from first-time buyers.

Median Home Price

The median price for an existing home was $170,700 in March, up 0.4 percent from a year ago and 3.6 percent from February. Distressed homes, accounting for 35 percent of last month’s sales, continued skewing prices downward slightly as they typically are discounted 15 percent compared to nondistressed homes. “Foreclosures have been feeding into the inventory pipeline at a fairly steady pace and are being absorbed manageably,” said NAR’s chief economist.

Inventory

Total housing inventory rose slightly to 3.58 million in March, representing an eight month supply of sales (if homes continue to sell at the current pace consistently and no new homes come on the market). Compared to the previous year, there are now 1.8 percent fewer homes on the market. This is the twentieth consistent month of inventory decline when compared to the previous year- one of several indicators that the market will likely “bottom out” in the next few months, according to NAR.

Mortgage Rates

Although mortgage rates continue to hover close to 5 percent, experts anticipate rates will increase to between 6 and 6.5 percent by the end of the year, since the Federal Reserve will need to raise them as the recovery gains traction to prevent inflation.

Affordability

Affordability remains near record levels, supported by the lowest mortgage rates in decades, low home prices, and the first-time home buyer tax credit. The home price-to-income ratio continues to remain well below the historical average of 25 percent. The ratio now stands at 14.7 percent.

Sources: National Association of Realtors, Freddie Mac

Government Action:

Fannie Mae Short-Sale Policy Change

Fannie Mae promotes short sales over foreclosures by shortening the amount of time that homeowners going through a short sale will have to wait before applying for a mortgage again. Fannie cut the length of time in half from four to two years.

Spokespersons communicated that the recession is not a “get out of jail free card” for homeowners who owe more than their home is worth. However, they acknowledged those who have had extenuating circumstances, such as a job loss, but are otherwise solid applicants should not be prevented from owning a home once their situation proves stable.

Homeowners will need to focus on rebuilding their credit during the waiting period.
Source: WSJ.com

Topics For Buyers & Sellers:

Summer Maintenance Tips

Summer is almost here! Below are some summer home-maintenance tips to help protect your investment.

1. Caulk exterior joints around windows and doors to help lower cooling bills.
2. Clean lint from the entire clothes dryer vent system, from the dryer to the exterior vent cap. Lint is flammable and poses a fire risk.
3. Repair cracks in concrete patios and driveways. For cracks less than 1/4″ wide, apply concrete caulk. For larger cracks, use concrete patch for caulk.
4. Wash the exterior of your house using ordinary garden-hose pressure and a mild detergent.
5. Clean and seal your porch or deck.

Keller Williams Realty Voted ‘”Highest Satisfaction For Home Buyers Among National Full Service Real Estate Firms, Two Years in a Row!” By J.D. Power & Associates

**SEARCH FOR ATLANTA HOMES NOW**

Keller Williams Realty Atlanta:  U.S. Real Estate Market Update – February 2010

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Keller Williams Atlanta Market Update: Video Report For U.S. Market – January 2010

This Month in Real Estate PowerPoint Reports For January 2010 – U.S. and Canada Markets

 This Month in Real Estate Newsletter for December 2009

Keller Williams Realty Voted ‘”Highest Satisfaction For Home Buyers Among National Full Service Real Estate Firms, Two Years in a Row!” By J.D. Power & Associates

This Month in Real Estate Video Report & PowerPoint For U.S. Market – December 2009

Each month, This Month in Real Estate provides expert opinion and analysis on real estate trends across North America. The aim of the consumer-oriented segments is to help Keller Williams Realty realtors combat the “doom and gloom” messages of the national print and television media with real information on the state of the real estate market.

Data continues to show slow steps to recovery in the U.S.

Do your clients know…

• We are getting closer to a balanced housing market
• Mortgage rates are back at record low levels seen in May
• FHA might be tightening its lending standards soon
• Short Sale guidelines were issued for the Foreclosure Prevention Program

This Month In Real Estate Video Report For U.S. Market – December 2009

This Month In Real Estate Powerpoint For U.S. Market – December 2009

Related Posts From This Month in Real Estate:

This Month in Real Estate Newsletter and Powerpoints for November 2009

This Month in Real Estate VIDEO Report For Canada Market: November 2009

This Month in Real Estate (U.S. Market) SPECIAL EDITION: The Updated 2009 Homebuyer Tax Credit

Keller Williams Realty Voted ‘”Highest Satisfaction For Home Buyers Among National Full Service Real Estate Firms, Two Years in a Row!” By J.D. Power & Associates