Pending Home Sales Increase
2009/06/02, 6:48 pm
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The Pending Home Sales Index, a forward-looking indicator based on contracts signed in April, rose 6.7 percent to 90.3 from a reading of 84.6 in March, and is 3.2 percent above April 2008 when it was 87.5.

Lawrence Yun, NAR chief economist, said buyers are responding to very favorable market conditions. “Housing affordability conditions have been at historic highs, but now the $8,000 first-time buyer tax credit is beginning to impact the market,” he said. “Since first-time buyers must finalize their purchase by November 30 to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers.”

Geographical Breakdown

  • Northeast: The Pending Home Sales Index shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago.
  • Midwest: The index rose 9.8 percent to 90.4 and is 11.1 percent above April 2008.
  • South: The index slipped 0.2 percent to 93.0 in April but is 3.5 percent higher than a year ago.
  • West: The index rose 1.8 percent to 94.8 but is 2.9 percent below April 2008.

NAR President Charles McMillan said there are numerous buyer assistance programs around the country. “Some states are offering bridge loans that allow first-time buyers to use the tax credit for downpayment and closing costs, but there are many other local government and nonprofit programs available to buyers, depending on location,” he said.

“Just last week, HUD announced that qualifying buyers can use the tax credit for closing costs on FHA loans, to buy down the interest rate or make a larger down payment. Buyers who are wondering about their options should contact a REALTOR, who can advise consumers on the housing assistance programs and resources available in a given area.”

Affordable Housing
NAR’s Housing Affordability Index is in record territory. The affordability index rose to 174.8 in April from an upwardly revised 171.9 in March, which makes it the second-highest monthly reading on record after peaking at 176.9 in January of this year. The HAI is a broad measure of housing affordability using consistent values and assumptions over time, which examines the relationship between home prices, mortgage interest rates and family income.

A median-income family, earning $60,900, could afford a home costing $296,800 in April with a 20 percent down payment, assuming 25 percent of gross income is devoted to mortgage principal and interest. Affordability conditions for first-time buyers with the same income and small down payments are roughly 80 percent of that amount. The affordable price was well above the median existing single-family home price in April, which was $169,800.

Pending Vs. Existing Sales
Yun cautions that the reporting sample for pending home sales is smaller than that of existing-home sales, so it is subject to greater variability. “In addition, the relationship between contracts on pending home sales and closings on existing-home sales is taking longer than in the past for several reasons,” he said. “Mortgage processing time has increased, it is taking many months to close on those homes requiring short sales with lender approval, and some sales are falling through at the last moment.”

The total number of existing-home sales is expected to improve but with dramatic local market variation in the timing of recovery. “The market has already bottomed in some areas, but this is an unusual housing cycle with some areas improving rapidly while others languish or decline,” Yun said.

Existing-home sales for May will be released June 23. The next Pending Home Sales Index will be on July 1.

Source: NAR (06/02/09)


1 Million Foreclosures This Year
2009/06/02, 6:44 pm
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As of this week, 1 million new foreclosures have been filed in 2009, according to estimates by the Center for Responsible Lending, a nonprofit research and policy organization dedicated to preserving home ownership.

A new foreclosure starts every 13 seconds – nearly 6,500 a day.

“It’s easy to think, ‘Well, that’s tough luck for the families that lose their homes.’ The truth is that foreclosures are costing neighboring families hundreds of billions of dollars and dragging down the entire economy,” says Michael Calhoun, president of CRL.

Calhoun called on lenders and loan servicers to utilize the tools offered by the U.S. government to keep people in their homes.

Source: Center for Responsible Lending (06/01/2009)

Kiplinger’s 10 best places to live and work
2009/05/28, 6:16 pm
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Where’s the best place to hide during this economic downturn?

Kiplinger’s Personal Finance magazine evaluated U.S. cities for their growth potential, analyzing their ability to hold onto jobs even if the economy softens further.

With assistance from Kevin Stolarick of Martin Prosperity Institute, the magazine concluded that cities where there are a lot of jobs in which people are paid to think are surviving this downturn better than areas where much of the workforce is employed in manufacturing or service jobs.

Stolarick says these creative-class jobs tend to help generate new businesses and that increases the vibrancy of the areas where they hold sway.

This employment analysis combined with data about income growth and cost of living led Kiplinger’s to choose these 10 cities as the best places to live and work in today’s challenging economy:

1. Huntsville, Ala.
2. Albuquerque, N.M.
3. Washington D.C.
4. Charlottesville, Va.
5. Athens, Ga.
6. Olympia, Wash.
7. Madison, Wis.
8. Austin, Tex.
9. Flagstaff, Ariz.
10. Raleigh, N.C.

Source: Kiplinger’s Personal Finance (07/2009)

S.C. home prices up slightly in Q1, down 3% from past year
2009/05/27, 7:04 pm
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Single-family home prices in South Carolina fell 3.12% in the past 12 months but gained 0.39% in the first quarter of 2009, according to a report released today by the Federal Housing Finance Agency.

The housing price index report ranked South Carolina 20th in home appreciation for the past year, based on sales of certain existing single-family homes.

Related stories:
Home sales data show values dropped 3.4% in S.C. during 2008
S.C. ranks sixth in nation for home value appreciation over the past year


Nationally, home prices declined 7.14% in the past 12 months and 0.55% in the first quarter of 2009. The quarterly decline was much smaller than the 3.3% price decline reported for the nation’s homes in the fourth quarter of 2008.

In South Carolina, home prices fell 3.5% in the fourth quarter of 2008, according to the previous housing price index report.

Homes in the Midlands and Upstate metro areas mostly gained value over the past four quarters. Meanwhile, homes in the coastal metro areas included in the report lost value.

National and state-level data in the Federal Housing Finance Agency report come from sales of existing single-family homes with conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. Metro area data also include appraisals used for refinancing.

Metro Area 12-month Change Quarterly Change Prior Quarter Change
Spartanburg 3.18% 3.05% -4.49%
Greenville-Mauldin-Easley 2.23% 0.67% 1.05%
Columbia 1.32% 0.22% 0.41%
Anderson -0.56% -0.35% 1.59%
Charleston-North Charleston-Summerville -3.19% -0.20% -1.67%
Myrtle Beach -7.10% -1.69% 0.98%

Source: Federal Housing Finance Agency

Forbes top 10 retirement spots
2009/05/26, 6:26 pm
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With the economy in turmoil and lifestyle preferences changing, traditional retirement counties aren’t looking as attractive as they used to. With this in mind, Forbes magazine set out to identify the Best Places to Grow Old.

The magazine mined data from the U.S. Census Bureau to determine where people older than 65 live now. It examined housing costs, employment opportunities, and the availability of hospitals and eldercare facilities, among other things.

Of counties with populations greater than 500,000, here are Forbes’ top picks of places in which to grow old gracefully:

  1. Montgomery County, Pa.
  2. Nassau County, N.Y.
  3. Pima County, Ariz.
  4. Palm Beach County, Fla.
  5. Honolulu County, Hawaii
  6. Brevard County, Fla.
  7. Montgomery County, Md.
  8. Ocean County, N.J.
  9. Westchester County, N.Y.
  10. Lancaster County, Pa.

Source: Forbes, Lauren Sherman (05/18/2009)

Investors watch for signs of recovery
2009/05/26, 6:25 pm
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As the spring selling season moves into full gear, investors and economists will be watching the housing market closely for signs that the worst is over.

“We can’t right this ship if we don’t run off that inventory,” says Tommy Williams, president of Williams Financial Advisors in Shreveport, La.

Stocks rose more than 3 percent on May 4 following increases in pending home sales and construction spending. But a high inventory of unsold homes and increasing foreclosures are reducing demand, and that makes it hard for prices to stabilize.

“We are getting to the point of the year where we are getting into the peak home sales season,” said Kevin Shacknofsky, co-portfolio manager of the Alpine Dynamic Dividend Fund. “The numbers now will be far more important … it’s summer time.”

Source: The Associated Press (05/24/2009)

Housing agency to buy 71 homes; most to be rented
2009/05/18, 6:31 pm
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Stimulus-funded roofing project The federal initiative sending the money to the region, called the Neighborhood Stabilization Program, is designed to stabilize property values in areas where clusters of homes are in foreclosure. Housing agencies purchase bank-owned homes, rehabilitate them as necessary and offer them as affordable sale or rental properties.



By Ashley Fletcher Frampton
Published May 18, 2009

Tri-county affordable housing officials plan to use $7.4 million in federal foreclosure relief money to buy 71 homes, and most will be offered as rentals.

Stimulus-funded roofing project The federal initiative sending the money to the region, called the Neighborhood Stabilization Program, is designed to stabilize property values in areas where clusters of homes are in foreclosure. Housing agencies purchase bank-owned homes, rehabilitate them as necessary and offer them as affordable sale or rental properties.

The Lowcountry Housing Trust learned in late March it would receive the $7.4 million, and officials are now firming up plans for spending the money.

Related stories:
Housing program to buy 100 homes in foreclosure
Tri-county to get $7.4M to help mitigate foreclosures

Plans are to buy 17 homes in Berkeley County, 40 in Charleston County and 14 in Dorchester County, in the following areas:

Urban core
S.C. Highway 165
U.S. Highway 78
Dorchester Road
U.S. Highway 52
West Ashley
Mount Pleasant
22 units
12 units
10 units
8 units
8 units
7 units
4 units

Of those, 10 in Charleston County will be offered for sale. The rest will be rented.

Tammie Hoy, executive director of the Lowcountry Housing Trust, said state housing officials preferred that most of the homes be offered for rent because the federal money must be spent quickly. Underwriting loans for home purchases can take awhile in the current market, Hoy said.

Renting the homes at affordable rates does more than help low-income families. Hoy said the program will prevent vacancies, which can breed vandalism. Moving families into foreclosed homes injects new economic activity into the neighborhood, creating demand for groceries, for example, Hoy said.

The federal program also will create jobs through the rehabilitation work some homes will require, she said.

The Lowcountry Housing Trust is working on an addition to its Web site that will track how the $7.4 million is spent and how many jobs are created, Hoy said. She said it will be similar to the federal government’s site.

The money slated for Berkeley, Charleston and Dorchester counties came through an economic relief package that Congress passed in 2008. South Carolina received a total of $44 million for the new housing program through that package.

Congress’s more recent stimulus act, the 2009 American Recovery and Reinvestment Act, also includes money for the Neighborhood Stabilization Program. Local housing officials are working on an application for a portion of that money as well.

Hoy said the second round of money is targeted for areas with high rates of foreclosure and vacancy, perhaps higher than some areas of the Lowcountry have seen.