Your Monthly Real Estate Market Update: Strong Gain in Existing-Home Sales Maintains the National & Local

Market Uptrend

Courtesy of: Ken Blankenship Broker/Owner ERA United Realty 395 South Atlanta Street Roswell, GA 30075 Direct: 770-289-8605 Email: Ken.Blankenship@ERA.com

September 2, 2009

Welcome to your monthly real estate Market Update! There is good news to report. For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of Realtors®.

Existing-home sales rose 7.2 percent. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005. The monthly sales gain was the largest on record for the total existing-home sales series dating back to 1999.

Lawrence Yun, NAR chief economist, said he is encouraged. “The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales,” he said.

Atlanta Market

Atlanta has followed a positive path similar to the national market, and for the first time in a very, very, very long time yearover-year sales were up in July. Inventories have dropped significantly to December 2006 levels. Compared with July 2008, expired listings are down and withdrawn listings are down. Average sales price is still off 9.8% but it is the smallest year-over-year decline since February 2008. Hopefully, August will continue the positive trends.

Continued on next page.

395 South Atlanta Street • Roswell, GA 30075 • 678-387-3300 • Fax: 678-387-3332

Inventory and Foreclosures

A healthy real estate market requires supply and demand balance. Ideally, there should be 6 months of inventory (houses for sale) on the market. Nationally, there is still about 9 months of inventory. That means there are too many homes for sale creating a “buyer’s market.”

While inventories have decreased dramatically since their peak last year (in Atlanta they are down about 30%), we still have a ways to go. Unfortunately, there are likely between 800,000 and 1,500,000 foreclosed properties nationally that have not been put on the market. If they were put on the market, inventories could flood, continue to deflate prices, and delay the long-term recovery. Legislation The $8,000 tax credit for first time homebuyers will expire on November 30. Senator Johnny Isakson, from the great state of Georgia, has proposed increasing the tax credit to $15,000 for all homebuyers. Mr. Isakson, a former real estate broker, told the Atlanta Board of Realtors he was two votes away from passing the bill in the Senate. Analysts believe that the tax credit will be extended to all homebuyers but at the current level of $8,000. Our Forecast We continue to be hopeful that the year-over-year existing home sales will trend up through 2010. New homes and condominiums will likely lag but are trending positively. Remember that sales price is a lagging indicator and will probably only stabilize in late 2009 and early 2010. Unemployment and foreclosures are still problematic for values and could mute the recovery. So, we are not quite as rosy as the media.

Please let me know if ERA United can help you with any of your real estate needs – anywhere in the United States.

Sincerely,

Ken Blankenship, Broker/Owner ERA United Realty Ken.Blankenship@ERA.com Direct: 770-289-8605

395 South Atlanta Street • Roswell, GA 30075 • 678-387-3300 • Fax: 678-387-3332

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