Volume 3, Issue 1 - January 22, 2010

Spring Buying Season Starts Early Due to Tax Credit

The spring buying season typically takes off in March and runs through May. But buyers who want to claim this year's tax credit.

— up to $8,000 for first-time buyers and up to $6,500 for repeat buyers — must have signed purchase contracts by April 30. And they have to complete the deal by June 30. Sales ―are going to take off in February and March and really take off in April. My concern is that the move-up buyer hasn't thought what they need to do. Their window is really short. They have to coordinate closing dates.

-- Jim Gillespie, president & CEO of Coldwell Banker, “Springtime House Hunters out Early Thanks to Tax Credit,” by Stephanie Armour, USA Today, Jan. 20, 2010.

Fitch Ratings Service: More Signs for a Housing Recovery

Fitch Ratings said there are further signs of a housing recovery, though more foreclosures are likely (as) many adjustable-rate mortgages are reset to new rates. ―More positive signals and developments are emerging for U.S. housing and related industries than at any time in the past three years,‖ the credit ratings agency said in a news release. Fitch cited the U.S. economy's shift from recession to expansion in last year's third quarter, and expectations that growth will continue this year.

-- “Fitch: Housing Recovery Seeing Gains,” Associated Press, Jan. 15, 2010.

Mortgage Applications Rise as Rates Drop

Mortgage application volumes increased to a seasonally adjusted 9.1% last week from the week before, mainly reflecting an uptick in refinancing activity, the Mortgage Bankers Association reported on Wednesday. Refinancing filings rose 10.7% for the week ended Jan. 15, according to MBA's latest survey. Applications for mortgages to buy homes were also up, increasing a seasonally adjusted 4.4%. Meanwhile, 30-year fixed-rate mortgages carried an average interest rate of 5% last week, down from 5.13% the week before.

-- “Weekly Mortgage Applications Rise 9.1% as Rates Drop: MBA,” by Amy Hoak, MarketWatch, Jan. 20, 2010.

Regional Update: Good News from Markets around the Nation

Lansing, Mich.

There's been a growing general feeling the local housing market is getting better. Now, there are numbers to back it up. Home sales in Greater Lansing surged 25% in the fourth quarter of 2009, a sign the local market is on its way up from rock bottom. "I predict that we're going to see a slow but steady increase in market value and activity over 2010 and that this is definitely the time to buy."

-- Bob Hubbell, CEO of a real estate company in Delta Township, Mich. “Area Home Sales Rise 25 Percent in Quarter,” by Melissa Domsic, Lansing State Journal, Jan. 21, 2010.

San Francisco Bay Area

There's a glimmer of good news for Bay Area homeowners: The local housing market last year began showing signs of a tentative, albeit uneven, recovery. Cities closer to the coast such as Palo Alto, Belvedere and Tiburon saw a return to year-over-year price gains of previously sold homes in 2009, according to MDA DataQuick, a data provider in La Jolla, Calif. Overall the region last year fared much better than in 2008. In 2009's fourth quarter, 29 of 91 cities or communities around the Bay posted gains in the median price of an existing single-family home from the same period a year earlier. In contrast, only two cities
or communities logged such gains in 2008, according to DataQuick.

“Bay Area Housing Market Starts to Pick Up,” by Jim Carlton, The Wall Street Journal (subscription required), Jan. 21, 2010.

Southern California

Rock-bottom interest rates and stronger sales in higher-priced neighborhoods helped Southern California's housing market post robust gains in the typically sleepy month of December, new data show, and experts say the momentum is continuing – ushering in an early start to the spring home-buying season. "Spring season is going to start early. We are having a lot of cash deals, so there is a lot of money out there, and there is amazing opportunity and great deals to be had."

-- Christopher Cortazzo, a sales agent in Malibu, Calif. “Southern California Housing Market
Strengthens in December,” by Alejandro Lazo, Los Angeles Times, Jan. 20, 2010.

Nashville, Tenn.

Reduced prices and sweeter returns on Wall Street for many investors may be melting a nearly frozen market for higher-priced homes, real estate agents say. Fourth quarter 2009 saw the first year-over-year increase in home sales in the Nashville area for property priced above $750,000, according to an analysis by appraiser Richard Exton of Manier & Exton. Sales of those higher-priced homes rose 29% to 89 homes in October-December, roughly the same percentage increase as the overall market experienced.

-- “Luxury Home Sales Rebound,” by Naomi Snyder, The Tennessean, Jan. 18, 2010.