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A Weichert, REALTORS® survey of 1,261 home buyers who made purchases between July 1, 2010, and Dec. 31, 2010, reveals that 28 percent were motivated by “favorable financing,” down from 31 percent in 2009 but up from 14 percent in 2008.

While 26 percent of those polled in 2005 said the desire to own a home and stop renting were motivating factors, very few respondents said the same in 2010. The survey reveals that 12 percent made home purchases because they had to relocate, 28 percent because they wanted a bigger home or more living space, and 11 percent because of potential financial growth.

Dominick Prevete, regional vice president for Weichert, says, “The takeaway is that home buyers who still see long-term potential financial growth in housing are more motivated today by the value presented by very low interest rates and discounted prices than they were five years ago. I think we are back in a period of a more realistic view of home ownership.”

Source: “Survey: Affordability Top Reason for Home Buying in 2010,” The Wall Street Journal, M.P. McQueen 

Other articles at: www.sierraproperties.com

Total housing inventory at the end of November fell 4.0 percent to 3.71 million existing homes available for sale, which represents a 9.5-month supply at the current sales pace, down from a 10.5-month supply in October.

National Association of Realtors President Ron Phipps said good buying opportunities will continue. “Traditionally there are far fewer buyers competing for properties at this time of the year, so serious buyers have a lot of opportunities during the winter months,” he said. “Buyers will enjoy favorable affordability conditions into the new year, although mortgage rates are expected to gradually rise as 2011 progresses.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.30 percent in November from a record low 4.23 percent in October; the rate was 4.88 percent in November 2009.

“In the short term, mortgage interest rates should hover just above recent record lows, while home prices have generally stabilized following declines from 2007 through 2009,” Yun said. “Although mortgage interest rates have ticked up in recent weeks, overall conditions remain extremely favorable for buyers who can obtain credit.”

A parallel NAR practitioner survey shows first-time buyers purchased 32 percent of homes in November, the same as in October, but are below a 51 percent share in November 2009 from the surge to beat the initial deadline for the first-time buyer tax credit.

Investors accounted for 19 percent of transactions in November, also unchanged from October, but are up from 12 percent in November 2009; the balance of sales were to repeat buyers. All-cash sales were at 31 percent in November, up from 29 percent in October and 19 percent a year ago. “The elevated level of all-cash transactions continues to reflect tight credit market conditions,” Yun said.

Form the National Association of Realtors, NAR

Existing-home sales rose again in September, affirming that a sales recovery has begun, according to the National Association of REALTORS®.

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums, and co-ops, rose 10 percent to a seasonally adjusted annual rate of 4.53 million in September from a downwardly revised 4.12 million in August, but remain 19.1 percent below the 5.60 million-unit pace in September 2009 when first-time buyers were ramping up in advance of the initial deadline for the tax credit last November.

Lawrence Yun, NAR chief economist, said the housing market is in the early stages of recovery. “A housing recovery is taking place but will be choppy at times depending on the duration and impact of a foreclosure moratorium. But the overall direction should be a gradual rising trend in home sales with buyers responding to historically low mortgage interest rates and very favorable affordability conditions,” he said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.35 percent in September from 4.43 percent in August; the rate was 5.06 percent in September 2009. 

Full article at: http://www.realtor.org/RMODaily.nsf/pages/News2010102501?OpenDocument

Both the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) and the NATIONAL ASSOCIATION OF REALTORS® (NAR) released monthly housing reports this week. However, each report told a different story about the housing market. Nationally, home sales declined but in California home sales rose 14.1 percent in May compared with April and 1.2 percent compared with April 2009.

KEEP THIS IN MIND

• The median price of existing single-family homes in California in May was $324,430, a 23.2 percent increase compared with a median price of $263,440 in May 2009, C.A.R. reported. The May 2010 median price increased 5.9 percent compared with April’s $306,230 median price.

• While home prices are rising month-over-month and year-over-year, affordability continues to remain at near-record highs. In the first quarter of 2010, 66 percent of first-time home buyers in California could afford to purchase an entry-level home in the state, according to C.A.R.’s First-time Buyer Housing Affordability Index.

• Many first-time home buyers timed the opening and closing of escrow to capitalize on both the federal and state tax credits, resulting in a rise in home sales in May. Although home sales rose, the number of home buyers signing sales contracts declined nearly 17 percent compared with April, which C.A.R. Chief Economist Leslie Appleton-Young attributes to the ending of the federal tax credit. “Although there may be a lessening of demand compared with the first half of this year, the number of escrows opened on a year-to-date basis is about the same as last year, and sales for all of 2010 will be on a par or slightly below last year,” said Appleton-Young.

• Despite the number of foreclosures listed for sale, the inventory of homes for sale still is below the long-run average of 7-months, according to C.A.R. In May, C.A.R.’s Unsold Inventory Index for existing, single-family detached homes was 4.6 months, unchanged from the same period a year ago. The index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.

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http://www.sgvtribune.com/ci_15353779#ixzz0rht9SqsU