We’re hearing from many agents and clients that “normal” listings – an owner occupied listing that’s not a short sale – are in short supply. As a result, when one of these rare birds appears it gets caught quickly in a flurry of multiple offers. What’s going on? The short answer is that it’s still devilishly complicated to get through a short sale or a Fannie Mae, FHA, or Freddie Mac owned property purchase and normal people just want to buy a house.
A quick update on current real estate market conditions across our coverage area:
- List prices were stable through November, but well below the May 2011 peak;
- Interest rates managed to go even lower (rate history);
- October sales volume was up versus September and sales are on track to be slightly higher in 2011 versus 2010 (NAR report);
- MBA’s purchase loan index continues to scrape along at late 1990′s levels with a relatively weak November (Mortgage Bankers Assoc. Data From Calculated Risk);
- and inventory continued a sharp decline as foreclosed properties continue to come on the market slowly.
In our view, November continued the sideways trend the market has been in since September. Purchase loan interest rates ticked down all month, yet home sales volume didn’t do much.
How strange is the market? Affordability is one interesting stat to consider. Freddie Mac reports housing affordability for the median income family every quarter. A number above 100 indicates the median income family qualifies for a median priced home. The index is currently at a breakout record level of 180 – 37% above the average since 1991 and the highest level ever tracked. The index means that in most parts of the country, the median income family has more than enough cash coming in to make the payments for a home. Why aren’t they buying? Economic uncertainty, flawed credit histories and no savings for a down payment are the top reasons we hear.
Check your local market stats on Movoto.com:http://www.movoto.com/market-statistics.aspx
Any Signs it’s Getting Better?
There is a small ray of hope in all the data. LPS reports that the number of homeowners delinquent on their mortgages is continuing to decline with fewer home owners entering delinquency in October. The inventory of homes in foreclosure is still going to take a few years to work through, but the declining levels of owners late on their payments is a welcome sign that the worst of the stress on home owners may be ending.
Help from Washington?
Freddie Mac wants to move houses (they owned 60,000 at the end of their 3rd quarter)! The agency’s latest HomeSteps SmartBuy incentive package includes a 2 year home warranty, up to 30% savings on new appliances, up to 3% buyer’s closing cost coverge and an incentive to your agent to help you buy the home. This program is available on initial offers submitted between Nov. 15 and Jan. 31 and escrow must close by March 15, 2012. See the details here and read carefully. There’s a lot of fine print, including limits on the states that are included (sorry California). Your Movoto Agent can help you find Freddie Mac owned homes
I’m going to repeat last month’s closing paragraph: if you have cash, good credit and a stable income and you’re trying to decide if now is a good time to buy, the answer is probably a loud “Yes!” Homes are on sale and you’ll look back 10 years from now and be amazed how cheap that home you bought (or let get away) was.
Check out these recent links for more news about the real estate market and Movoto.com
- NEW! Search For Mortgages on Movoto.com
- How to Buy a HUD Home for $100 Down
- How to Bring About a Housing Recovery
- 6 Tips for Picking Your Dream Home
Who is Movoto Real Estate, you might ask? Movoto is an online real estate brokerage based in San Mateo, CA. Our blog has been recognized for its unique approach to city-based research by major news organizations around the world such as Forbes and CBS News.