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Homes More Affordable Now
March 8, 2010 -- Banks and builders report that home prices are at near record levels of affordability. In the last three months of 2009, a family making the median income of $64,000 a year could afford to buy 70.8% of all homes sold during that time! A home is considered
affordable if a family making the median income would have to spend no
more than 28% of their take-home pay for housing. In addition, no one knows what will happen to mortgage rates once the Fed stops buying mortgage bonds at the end of this March. Smart buyers shouldn't drag their feet, especially those wanting the tax credit, which requires a signed contract by April 30.
Local home resales soar, buck
Local
Realtors sold 872 existing single-family homes in December, a 43 percent
jump from the 610 they sold in the same month a year earlier, the
Florida Association of Realtors said. Sales soared in Sarasota-Bradenton
and throughout
The reports
had economists questioning if the national housing recovery is on solid
footing. But local Realtors say they’ve been too busy to contemplate the
issue.
“Every
agent I talk to, I always ask: ‘How’s business?’ And everybody is
telling me that they’ve been extremely busy,” said Cindy Greco of
More
noteworthy was that prices also went up locally. The median sales price
— the point where half sold for more and half for less — was $167,400
last month, up from $160,000 in the last month of 2008.
That 5
percent gain broke a 3 ½-year streak of monthly year-over-year price
drops.
December’s
year-over-year gain “tells me our single-family market has pretty much
stabilized right now,” Greco said. “Prices finally got down to the point
that buyers were willing to pay.”
Local home
prices peaked at $353,500 in January 2006, and bottomed out at $144,000
in February 2009. The median home price has stayed in the $150,000 to
$180,000 range since then, as first-time homebuyers and investors
snapped up deeply discounted foreclosures and other distressed
properties.
They
continued to dominate the condominium market in December, pushing sales
up but prices down. Sales grew by 144 percent — from 127 units sold in
December 2008 to 310 sold last month — while the median sales price
dropped another 22 percent to $148,600, according to the Realtors group.
Experts had
forecast a sales lull after the original Nov. 30 expiration of an
up-to-$8,000 tax credit for first-time homebuyers. Although Congress
extended the tax credit to April 30 and expanded it to include
homeowners who move, it did so in early November — too late for sales
that were set to close in December and January.
It wasn’t
missed much, several
“This past
December was extremely busy with straight sales, short sales and bank
sales,” said Marilyn Sakelaris, an agent at Leslie Wells Realty in
Parrish. “We were busy enough.”
With the
strong finish, local single-family home resales were 15 percent higher
in 2009 than in 2008. But the median sales price fell 29 percent to
$160,000, tied with
—The
Associated Press contributed to this report.
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This is the classic picture of a "Buyer's Market."
With the Stimulus at work, with lower interest rates, a pent-up demand for housing and other incentives, savvy buyers know that now is the time to buy.