Home Sellers become More Realistic on Home Prices while Realtors Express Greater Optimism about Housing Market

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RISMEDIA, May 23, 2009-HomeGain, one of the first websites to provide free instant home values, announced the results of an extensive nationwide survey on home prices based on the responses of over 1,150 Realtors.

The survey shows that 36% of homeowners think their homes should be listed 10 to 20% higher than what their Realtors’ recommend, down from 45% in the first quarter.

Conversely, 64% of homebuyers think that homes are overpriced versus 59% who believed the same in the first quarter.

“Realtors are in a unique position as they get to hear both sides of the home price story - the buyers’ and the sellers’. They then apply their own home valuation analysis based on their understanding of the market which often meets resistance from buyers and sellers,” said Louis Cammarosano, General Manager of HomeGain. “The results of our second quarter Realtor home prices survey indicates that home sellers seem to be getting the message that perhaps their homes are not worth as much as they thought they were, while buyers are expecting to find a bargain on every corner.”

The Realtors surveyed expressed more optimism in the second quarter survey on the direction of home prices than in the first quarter, with 22% of them believing that home values will increase in the next six months versus 11% who believed the same in the first quarter. Twenty-nine percent of survey respondents believe that home prices will fall in the next six months versus 53% who believed the same in the first quarter survey.

“There is major improvement in the number of homes selling,” stated Heather Lawson, Broker Century 21 Watson Real Estate in Genoa, IL. Gillian Goldrich of Coldwell Banker Residential Brokerage in Woodbridge, CT, agreed with Lawson, stating, “Markets are definitely picking up. It seems that buyers are getting off the fence and taking advantage of tremendous buys.”

Fifty-seven percent of Realtors surveyed indicated their approval of Obama’s performance as President. These results mirrored the nationwide results of the Rasmussen Daily Presidential Approval Index. Fifty-five percent of survey respondents believe that the Obama stimulus plan will have or has had no impact on home values versus 45% who believed the same in the first quarter survey.

For more information, visit www.homegain.com.

Single-Family Starts and Permits Edge Higher in April

RISMEDIA, May 21, 2009-Production of single-family homes edged upward in April 2009 as builders responded to improving conditions for new-home buyers, according to newly released figures by the U.S. Commerce Department. While overall starts fell 12.8% to a record-low seasonally adjusted annual pace of 458,000 units, the decline was entirely confined to the multifamily sector, where production fell 46% to a 90,000-unit pace for the month, while single-family starts posted a 2.8% gain to 368,000 units. 

“With some of the best home-buying conditions of a lifetime now in place-including historically low mortgage rates, affordable prices and a first-time home buyer tax credit-single-family builders are starting to see the light on the horizon as more consumers realize they can now obtain the home of their dreams,” said NAHB Chairman Joe Robson. “Meanwhile, the extreme difficulty that builders are encountering in obtaining financing for new multifamily structures has ground production in that sector almost to a halt.”

“A severe credit crunch for acquisition, development and construction financing and a lack of investor interest in Low Income Housing Tax Credits are the main factors that are keeping apartment builders from moving ahead with new projects, along with the competition from excess inventory that’s on the market,” noted NAHB Chief Economist David Crowe. “Ultimately, the logjam in builder financing must be broken in order for housing construction to provide the boost that the national economy needs to get back on track.”

Meanwhile, improving activity on the single-family side aligns with what builders have been reporting in recent NAHB surveys, Crowe said. “Very attractive housing affordability factors- particularly the federal $8,000 first-time home buyer tax credit and other tax credits being offered by states for purchases of newly constructed homes are helping drive potential buyers back into the market,” he explained.

Single-family housing starts rose for a second consecutive month in April, posting a 2.8% gain to a 368,000-unit pace for the month. At the same time, issuance of single-family permits, which can be an indicator of future building activity, rose 3.6% to 373,000 units.

On the multifamily side, starts fell 46% to an all-time low 90,000-unit pace, while permits declined nearly 20% to 121,000 units.

Regionally, combined single- and multifamily housing starts declined across every part of the country except the West in April, where a 42.5% gain offset a nearly equivalent decline in the previous month. Starts fell 30.6% in the Northeast, 21.4% in the Midwest and 21.1% in the South, again largely due to big declines in the more volatile multifamily sector.

Similarly, regional permit issuance for combined single- and multifamily units was down in all but the West, which reported no change for April, while the Northeast posted a 7% decline, the Midwest a 4.8% decline and the South a 3.4% decline.

For more information, visit www.nahb.org.

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HUD Action Allows Home Buyers to Use 8,000 Dollar Tax Credit for Downpayments on FHA-Insured Loans

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RISMEDIA, May 16, 2009-HUD Secretary Shaun Donovan’s decision to allow consumers to use the $8,000 first-time home buyer tax credit to help cover their downpayment and closing costs on FHA-insured mortgages will be a big boost to the housing market, according to the National Association of Home Builders (NAHB).

“The biggest obstacle for first-time buyers is coming up with a downpayment,” said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla. “We commend Secretary Donovan for acting decisively to enable buyers to access the tax credit at the time of closing. This will help to stimulate home sales, stabilize housing and get the economy back on track.”

The measures announced by HUD would allow FHA-approved lenders; federal, state and local government agencies; and FHA-approved non-profit organizations to supply home buyers short-term or “bridge loans” up to the amount of the $8,000 first-time home buyer tax credit.

Longer term loans secured by second liens can also be used by government agencies and FHA-approved non-profit organizations to facilitate home sales. Several state housing finance agencies have introduced such programs and a number of agencies are considering that possibility.

Previously, the home buyer would have been unable to access the tax credit until they filed their next annual tax return or an amended 2008 tax return and received the refund from the IRS.

“Secretary Donovan shares our view on the need for a housing and economic recovery,” said Robson. “We appreciate his leadership in moving swiftly to help first-time home buyers to access the tax credit up-front at the time of closing. The timing could not have been better as we are in the midst of the crucial spring home buying season.”

The next step is to see how FHA-approved lenders use HUD’s new guidelines to actually monetize the tax credit for first-time home buyers and structure the payback provisions of the loans. NAHB encourages lenders to act
promptly to put these provisions into place.

To qualify for the tax credit, first-time home buyers must actually close on their home purchase by Dec. 1, 2009. Buyers can take the credit on their 2008 or 2009 income tax return.

For more information, visit www.nahb.org.