Research: This Month in Real Estate, June 2009

Every month Keller Williams performs an in-depth analysis of the Real Estate Market. May 2009 was a critical month in Real Estate especially with home prices falling to 2003 level and the first signs of the market bottom are in play. This presentation looks at the National Real Estate Market. If you are interested in our South Walton market or specific areas including Grayton Beach, Seagrove Beach, Destin, Sandestin, Rosemary Beach, WaterColor or WaterSound, please call or email Craig or Tracy @ Team Baranowski 850.259.1788 or 850.259.4270.
The detailed report includes: Home sale update, median home price update, Inventory update, martgage rate analysis, affordability index and more. See screen shots below…

Predictions by the Keller Center at Baylor University appear to be on target. A poll of 840 economists last year suggested the housing market would recover this year with a slow rejuvenation in sales, strengthening prices and mortgage rates staying relatively steady for the year. Approximately 75% of economists predicted that the market would bottom at the end of this year. More than half expected a bottom by the second quarter of 2009.
Pending home sales, a leading indicator for the housing sector, recorded the largest monthly gain since October 2001. Favorable market conditions continue to encourage buyers into the market. Housing affordability remains in record territory with 30-year mortgage rates hovering around 5%, home prices approximately 30% below levels seen during the 2006 peak, and an abundance of homes on the market. A rise in construction spending on the back of increasing builder confidence and the slowing rate of job losses are also pointing toward a possible turnaround.
First-time buyers continue to drive activity to the benefit of trade-up or repeat buyers. Their flurry of activity owes much to the $8,000 first-time buyer tax credit. In April first-time buyers accounted for 40% of all home sales, and the trend is expected to spur more activity in the coming months. “Since first-time buyers must finalize their purchase by November 30, 2009,  to get the credit, we expect greater activity in the months ahead, and that should spark more sales by repeat buyers,” according to Lawrence Yun, NAR chief economist.
A recent change this month allows qualified first-time home buyers to use the tax credit to help pay closing costs on FHA loans or to buy down the interest rate or make a larger down payment.
Click here to download a detailed analysis presentation on the National Real Estate Trends June 2009 Report.