Real Estate News Continues to Improveby Tim Manni
Last week we wrote about home sales improving across California. This week, according to statistics released by the National Association of Realtors (NAR), the trend is spreading nationally. Existing home sales rose 5.1% in February, spurring the strongest increase since July 2003.
Despite the overall number of sales remaining “relatively soft,” the housing market is steadily showing significant signs of improvement — a trend which experts say is being driven by first-time home buyers shopping for deals and taking advantage of the government’s latest housing incentives:
Lawrence Yun, NAR chief economist, says first-time buyers accounted for half of all home sales last month, with activity concentrated in lower price ranges.
“Because entry level buyers are shopping for bargains, distressed sales accounted for 40 to 45 percent of transactions in February,” he says. “Our analysis shows that distressed homes typically are selling for 20 percent less than the normal market price, and this naturally is drawing down the overall median price.”
NAR President Charles McMillan says home buyer traffic picked up steadily after the president announced his $8,000 first-time buyer tax credit.
With unemployment on the rise, some real estate experts are warning against expecting a market rebound anytime soon. Yet according to a survey commissioned by Move Inc., an operator of Realtor.com, “Nearly 25 percent of adults say they plan to purchase a home in the next five years and half of those (53.5 percent) will be first-time home buyers…”
Historically speaking, home sales should continue to improve in the coming months on account of the spring home-buying season.
Here’s a great example of the kind of deal that is driving buyers to the market.