Driven by the first-time buyer tax credit, existing-home sales showed another big gain in October with a strong uptrend established over the past seven months, while inventories continue to decline, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – surged 10.1 percent to a seasonally adjusted annual rate¹ of 6.10 million units in October from a downwardly revised pace of 5.54 million in September, and are 23.5 percent above the 4.94 million-unit level in October 2008. Sales activity is at the highest pace since February 2007 when it hit 6.55 million.

Lawrence Yun, NAR chief economist, was surprised at the size of the gain. “Many buyers have been rushing to beat the deadline for the first-time buyer tax credit that was scheduled to expire at the end of this month, and similarly robust sales may be occurring in November,” he said. “With such a sale spike, a measurable decline should be anticipated in December and early next year before another surge in spring and early summer.”

Now that the tax credit has been extended and expanded, potential buyers have until April 30 to have a contract in place. “There is still a large pent-up demand that can be tapped before the tax credit expires. Our recent consumer survey further shows that 13 percent of successful first-time buyers had a previous contract that was cancelled or fell through – there likely are many more buyers who were attempting to purchase but simply ran out of time,” Yun said.

Historically low interest rates also are boosting the market. “Mortgage interest rates last month were the third lowest on record dating back to 1971,” Yun noted. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 4.95 percent in October from 5.06 percent in September; the rate was 6.20 percent in October 2008. Last week, Freddie Mac reporter the 30-year rate dropped to 4.83 percent.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said strong demand by first-time buyers is creating some unusual conditions. “In parts of the country, especially in Southwestern states but also in Florida and suburban Washington, D.C., we’ve been getting many reports of multiple bids in the lower price ranges with foreclosed properties getting absorbed quickly,” she said.

“In fact, low-end inventory has become very tight in many areas and in some cases buyers are becoming more aggressive. In this kind of environment it’s important to work with a Realtor® who can walk you through the process and help you negotiate a satisfactory deal,” Golder said.

Total housing inventory at the end of October fell 3.7 percent to 3.57 million existing homes available for sale, which represents a 7.0-month supply² at the current sales pace, down from an 8.0-month supply in September. Unsold inventory totals are 14.9 percent below a year ago.

“The supply of homes on the market is now at the lowest level in over two-and-a half years – we’re getting closer to a general balance between buyers and sellers,” Yun said. The last time the relative housing inventory was this low was in February 2007 when it also was at a 7.0-month supply.

The national median existing-home price³ for all housing types was $173,100 in October, down 7.1 percent from October 2008. Distressed properties, which accounted for 30 percent of sales in October, continue to downwardly distort the median price because they usually sell at a discount relative to traditional homes in the same area.

“In the second half of 2010, if home values show consistent stabilization or even a modest increase, then home sales could remain at normal healthy levels because consumers would no longer be worried about a price overcorrection,” Yun said.

He added that low home prices also are contributing to extremely favorable affordability conditions. “With the abnormal drop in home prices over the past few years, the price-to-income ratio has fallen below the historic trend line,” Yun said. “This is adding to the buying power of the typical family, with affordability conditions this year at the highest on record dating back to 1970, but prices are beginning to flatten and are poised to rise next year.”

Single-family home sales rose 9.7 percent to a seasonally adjusted annual rate of 5.33 million in October from a pace of 4.86 million in September, and are 21.4 percent above the 4.39 million-unit pace in October 2008. The median existing single-family home price was $173,100 in October, down 6.8 percent from a year ago.

Existing condominium and co-op sales surged 13.2 percent to a seasonally adjusted annual rate of 770,000 units in October from 680,000 in September, and are 40.8 percent above the 547,000-unit level a year ago. The median existing condo price⁴ was $172,900 in October, which is 10.4 percent below October 2008.

Regionally, existing-home sales in the Northeast rose 11.6 percent to an annual level of 1.06 million in October, and are 27.7 percent higher than October 2008. The median price in the Northeast was $235,400, down 2.6 percent from a year ago.

Existing-home sales in the Midwest surged 14.4 percent in October to a pace of 1.43 million and are 28.8 percent above a year ago. The median price in the Midwest was $146,600, a gain of 1.1 percent from October 2008.

In the South, existing-home sales rose 12.7 percent to an annual level of 2.30 million in October and are 25.7 percent higher than October 2008. The median price in the South was $151,100, down 6.3 percent from a year ago.

Existing-home sales in the West increased 1.6 percent to an annual rate of 1.31 million in October and are 12.0 percent above a year ago. The median price in the West was $220,200, which is 14.7 percent below October 2008.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

Southern California’s housing market showed fresh signs of a comeback last month as first-time buyers took advantage of a federal tax credit aimed at keeping the fragile recovery on track.

And the tax credit program, which was expanded this month, may be helping boost the all-important move-up market as people who already own homes started traipsing through open houses looking for good buys.

“We are seeing signs of life,” said Glenn Kelman, chief executive of online real estate brokerage Redfin.

But whether the burgeoning interest translates into even more sales remains to be seen, experts say.

In October, the median price paid for all homes in six Southland counties rose to $280,000, up 1.8% compared with the previous month, and the number of homes sold increased 2.8%, San Diego research firm MDA DataQuick reported Tuesday.

Spurred by low interest rates and cheap foreclosure properties, as well as the $8,000 tax credit for first-timers that had been set to expire Nov. 30, the region’s median sales price has risen or held steady on a month-to-month basis since hitting a low in April.

One key test will be whether those who own a home will begin re-entering the market. Congress this month extended the controversial tax credit until April 30, expanded it to include a $6,500 credit for current homeowners buying houses worth $800,000 or less, and stretched the qualifying income limits to $125,000 for individuals and $225,000 for joint tax filers.

Real estate agents already are using the tax credit’s extension to attract potential buyers. And some say the extension has at least sparked curiosity.

In the first week of November, as Congress was approving the tax credit bill, traffic at real estate website Trulia.com, for instance, increased 75% to record levels compared with the same week last year.

On Sunday, a steady stream of potential buyers roamed through a two-story, five-bedroom home in Los Alamitos listed at $697,777. Brochures and an assortment of stale chocolates sat on a living room table as a stereo played jazz.

“Did you know about the new tax credit?” real estate agent Blair Newman asked prospective buyers.

Andre Wills and his wife, Kim, of Carson, said they were shopping for a new home because of the tax credit, lower prices and a desire to move into a neighborhood with a good school district.

“The market is down now, and so I want to take advantage of it,” Andre Wills said as his sons, ages 6 and 9, played basketball in the driveway.

Unlike first-time buyers motivated by deeply discounted home prices, many current homeowners faced See Full Article by Alejandro Lazo LA Times

Amid the market downturn, the public is welcome to see some properties listed for more than $10 million.

Story by: Lauren Beale, LA Times

For Florence Mattar, each open house has a routine. She drives around the neighborhood placing signs, brings in fresh flowers, stocks the refrigerator with bottled water and sets out a sign-in sheet.

Similar scenes play out across Southern California every weekend, with one expensive exception. The Tuscan-style house she is “sitting,” to use the industry term, is listed at $21.9 million. And anyone is welcome to see it. All 9,691 square feet of it.

Whether spurred by the down housing market, the opportunity to promote themselves or a determination to make a sale, a select group of area real estate agents has raised the bar on public open houses above $10 million — to $12.9 million in Beverly Hills, Malibu and Brentwood Park, $18.9 million in Pacific Palisades and even higher in the “bird streets” area of the Hollywood Hills, where Mattar’s reclaimed stone, brick and wood listing sits serenely at the end of a cypress-lined driveway.

“You get more people because they are curious,” the Coldwell Banker agent said. “They’ve never stepped in a house that price.”

Through bubbles and busts, the open house has remained a key tool for buyers and sellers, at least for properties with price tags that are less than gold-plated.

Nearly half of recent buyers used open houses for information during their home search, according to the National Assn. of Realtors, and 15% found a home through an open house, a number that has held fairly steady since 2001.

When prices were headed for the stratosphere, a certain amount of open-house upscaling could be expected. Yet now, with home-profit expectations tumbling back to Earth, the public showing has gone even more up-market.

Simon Beardmore of Sotheby’s International Realty in Brentwood doesn’t typically hold public open houses at higher price points, but made an exception recently for a newly built 10,300-square-foot gated estate in Brentwood Park listed at $12.95 million. The first week it drew about 150 visitors, the second 100 and the third from 60 to 70.

“It was very appropriate because it’s a showcase for my client, who is a builder,” he said. The open houses have brought work for builder Paul Morrow; Beardmore said it was a good business decision for him, too, because showings often attract curious neighbors.

“I’m very lucky to be able to hold an open house at this price because it gives me a lot of face time with the clientele of the neighborhood,” he said.

A major reason to have an open house at a pricey property, agents agree, is to pick up more clients.

The showings attract people relocating from other (Read Full Article at LA Times) by LAUREN BEALE

As we predicted, today November 6, 2009  President Obama  signed an extention of the home buyer’s tax credit with a significant expansion.

Click Here for a quick matrix showing the differences.

Let  me quickly summarize some of the these changes for you now:

• First, the expiration date for the credit will move to April 30, 2010.
• First-time buyers who have not had interest in a principle residence for the last three  years are  eligible at the maximum amount of $8,000 for  married couples, $4,000 for those filing separately.
• Current homeowners, who have consecutively maintained their home  as their primary residence for five of the last eight years, are also eligible. However, the maximum amount for those homeowners is $6,500 for  married couples and $3,200 for those filing separately. Starts November 7, 2009
• The tax credit may not used to purchase a home for more than $800,000.
• All  buyers who want to get the credit must include documentation of the purchase on their tax returns.
• The income limits for both tax credits have been raised to $125,000 for single  buyers and $225,000 for married couples.

Thank you for your continued referals and if you have questions or you’d like me to represent you in the sale or purchase of your next home please contact me here.

Lee Williams

(310) 882-5428

LeeWilliams@KW.com

I have always been leery of services that offer to provide property searches you can get for free from a foreclosure specializing agent.  Yes, I’m biased but, what value is there in paying for a service that only gives you an address, fancy photos and a map?  You need to know the background on the property, county records, mortgage balance, selling bank, listing agent habits, days on market, price reductions, special financing requirements or features.  If you feel you must sign up for a “Free Trial” then do so simultaneously with our office and do a side by side comparison. Click the Foreclosure List button to the right.

Read David Lazarus Article on the Subject at the LA Times.