Increase in home sales predicted

Expect More Home Sales This Season

Our housing market is poised for an  increase in home sales during the traditional spring buying season, as employment improves and rates remain low, Freddie Mac said in its April 2011 economic outlook. 

Overall, home sales should increase 5% in 2011 compared to 2010 — a projected 4.9 million home sales nationally. Freddie Mac estimates that number will rise 12.2% to 5.5 million homes sales in 2012. 

The Federal Reserve’s current monetary policy and Treasury note purchase program are keeping rates low, according to Frank Nothaft, chief economist at the agency. 

On a monthly comparative basis, homes sales are expected to be lower this month than April 2010 because sales last year were inflated by the first-time homebuyer tax credit, Nothaft said. 

Short-term rates are especially supportive of household borrowing, Nothaft said, adding that he expects adjustable-rate loans to account for 7% of all 2011 sales. This is up from 5% in 2010.  

Source: HousingWire

Related articles

• Freddie Mac April 2011 U.S. Economic and Housing Market Outlook (benzinga.com)

Save more than daylight!

Save more than daylight!

Don't forget to set your clocks an hour ahead this Saturday before you turn in.

If you or a friend are still waiting for something to happen before you get serious about buying your next home, consider the following facts:

You can't buy a home without funds. Most of us don't have the price of a home in liquid assets, so we turn to lenders for help. When we borrow money from a lender, we have to pay for it--think of it as rent.  The rent we pay depends on the mortgage rate and the length of the loan. When rates go up, the rent for the money goes up.

• Fact: 30-year fixed mortgages are around 5% today.
• Fact: No one can guarantee that the rates will stay this low. Today's 5% may be tomorrow's 6.125%.
• Fact: A single percentage increase in mortgage "rent" results in either a higher monthly payment or a reduction in your buying power.

For example: At today's rates a $400,000 loan would result in a monthly payment of $2147 (before taxes and insurance). A 1% increase in rates would raise the monthly payment to $2398 (or reduce the price you could afford by 10%).

North Kitsap sales prices in February were were lower than they were in February of last year.  The median price (half the homes on the market are listed above the median, half below) of the 411 homes on the market is $392,000. That means 205 homes are available for under $392,000!

Not to put too fine a point on it, if you or your friend are waiting for prices to drop, either on a home or the rent for a mortgage, you are probably making a mistake. If you're serious about buying, now is the time to get pre-qualified with a lender. 

Once you know what you can afford, beat the other buyers attracted by these low prices and rates. Historically, the market heats up right about now--Daylight Saving Time.

Poulsbo market explodes! Up 180% over last year

Closed Transactions July 15-21

A subscriber emailed me this week: "Jeez, Paul, can't you make these reports less like objective Wall Street Journal reports and more fun like we see on Fox News?"

Well okay, Tim, this headline's for you. Bet you opened it, too!

I guess I can fun it up a little, but I won't lie about the statistics. okay

The good news: the market is picking up, especially in Poulsbo, and buyers are snapping up well-priced homes quickly. Buyers are offering 92-100% of what sellers are asking.

The hard news: selling prices lower on average than last year during this period.

If you'd like the selling details of the home that closed in your neighborhood,  just ask.

North Kitsap Market Report June 1-7

Closed Transactions June 1-7

Clearly the Bainbridge Island market spiked this week compared to last year at this time. The average selling price dropped nearly 30%, homes closed much more quickly, and sellers got 94% of their listing price.

Activity in the other markets lagged behind last year at this time, especially in Kingston.

If you'd like the selling details of the home that closed in your neighborhood,  just ask.

Home sales in North Kitsap County

Closings Dec 22-31, 2009

The market showed signs of improvement, especially in Bainbridge Island and Kingston. This is a good sign. The next two months will be a better indicator, of course. Interest rates should stay steady at least that long and the extended tax credit should help. Tomorrow: the year-end report.