Again this month, we have seen some positive signs in the Greater Boston Area that point to an increase in activity and a firming of prices.

The number of homes that actually closed during the period increased substantially over May’s activity as well as the 3 month average in all 6 counties. While these numbers indicate a healthy improvement compared to the recent past, closed sales still lag from the same period a year ago.

The number of homes that went Under Agreement in June generally increased in the area. With the exception of Middlesex and Plymouth counties, which incurred moderate declines, the Under Agreement activity was once again encouraging. Bristol saw an increase of 31.7% while Essex and Norfolk improved by 13.78% and 4.62%, respectively. In Suffolk, this activity increased a whopping 87.95% over May and sits at 36.84% over the 3 month average.

In the most encouraging sign, the number of homes going under agreement in June was higher than June of 2010 in all six counties.

Average sales prices on closed sales appear to be firming up across the region, showing moderate increases over last month and the 3 month average. Prices are at approximately the same levels as a year ago and the actual sales price as a percentage of the original list price has seen some improvement over the recent past indicating that sellers may have become more realistic in the initial pricing of their homes.  Supporting this premise is that the average Days on Market for homes closed in June dropped by over 12% to 109 days in May and is 21.6% below the last 3 month average.  However, Days on Market is still above last June’s 95 days.

The available supply of inventory of homes for sale in June increased slightly over May’s levels but the dramatic improvement in the number of sales that occurred in June resulted in a major decrease in the Absorption Rate (supply of homes for sale divided by the number of sales in the current month).  On average, there is a 6.03 month supply of homes for sale across the 6 county area, with the highest in Plymouth at 8.63 months and Suffolk being the lowest at 4.01 months.

For Full Report and Supporting Data/Documentation, Kindly Click (HERE)

"New York, June 28, 2011 – Data through April 2011, released today by S&P Indices for its S&P/CaseShiller  Home Price Indices, the leading measure of U.S. home prices, show a monthly increase in prices for the 10- and 20-City Composites for the first time in eight months. The 10- and 20-City Composites were up 0.8% and 0.7%, respectively, in April versus March.  Both indices are lower than a year ago; the 10-City Composite fell 3.1% and the 20-City Composite is down 4.0% from April 2010 levels. Six of the 20 MSAs showed new index lows in April – Charlotte, Chicago, Detroit, Las Vegas, Miami and Tampa. Thirteen of the cities and both composites posted positive monthly changes. With index levels of 152.51 and 138.84, respectively, both the 10- and 20-City Composites are above their March 2011 levels, which had been a new crisis low for the 20-City Composite".

The U.S. Census Bureau and the Department of Housing and Urban Development today announced that privately-owned housing starts in April were at a seasonally adjusted annual rate of 541,000, up 3.5% from the revised April estimate. However, these new housing starts were 3.4% below the rate from a year earlier.

Housing starts for single family homes in May were up 3.7% at 419,000 units although still 8.9% below last year. Starts for multi-family units were up 8.9% from May and 24.1% from a year earlier.

The data indicated that housing starts for single family homes declined by 19.1% in the Northeast from April but increased in all other areas of the country. In the Midwest, they were up by 12.5%, the South showed an increase of 1.9%, and the increase in the West was 15.6%.

Newly authorized building permits, an indicator of future housing starts, increased by 8.7% from April at a seasonally adjusted rate of 612,000. Single family authorizations in May were up 2.5% from April at a rate of 405,000 while authorizations for structures with two or more units were up 34.0%.

The level of housing starts remain at historically low levels as home builders look for signs of sustainable economic improvement before committing to new projects. According to Bob Nielsen, chairman of the National Association of Home Builders, "while the upward movement registered in the report is somewhat good news, housing production continues to bounce along the bottom near historic lows, and is only running at a level necessary to replace dilapidated or destroyed units."

An obvious bright spot in the report is the increase in multi-family units reflecting an increase in demand for rental apartments.

Clearly, these numbers show continued weakness in the housing markets across the country although the low level of housing starts will continue to allow existing home sales, including foreclosures, to be absorbed off the market. As always, be aware that national and regional statistics are not a true gauge of your local real estate market. Each local market is unique and may differ greatly from these figures.

Great Article from WSJ. Authors comment on multiple events and market indicators illuminating on why "now" might very well be a good time to buy.

http://online.wsj.com/article/SB10001424052702304563104576361522020024248.html?mod=WSJ_RealEstate_LeftTopNews

Pending home sales fell in April with regional variations following increases in February and March, with unusual weather and economic softness adding to ongoing problems that are hobbling a recovery, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, dropped 11.6 percent to 81.9 in April from a downwardly revised 92.6 in March. The index is 26.5 percent below a cyclical peak of 111.5 in April 2010 when buyers were rushing to beat the contract deadline for the home buyer tax credit.

The data reflects contracts but not closings, which normally occur with a lag time of one or two months.

For Entire NAR Report, Kindly (Click Here)

The US Census Bureau and the US Department of Housing and Urban Development announced that sales of new one-family houses in April 2011 were at a seasonally adjusted annual rate of 323,000, up 7.3% above the revised March 2011 figures. However, current volume remains 23.1% below the April 2010 estimate of 420,000.

The median sales price of new homes sold in April 2011 was $217,900 and the average sales price was $268,900. The median sales price is up 4.6% over the figure from a year earlier while the average sales price is down slightly.

At the end of the period, there were 175,000 new homes for sales indicating a supply of 6.5 based on current absorption rates. This is down from a supply of 8 to 9 months that existed throughout most of the second half of 2010 and caused primarily by the reduction in the number of new housing starts that have occurred up to this point in the year. (Link: New Housing Starts)

Homes that sold during April had been on the market for an average of 8.8 months. This is down dramatically from April of 2010 when homes that sold had been on the market for an average of 14.0 months.

The report indicated that new home sales in April increased in all four US regions. Sales increased 7.7% in the Northeast, 4.9% in the Midwest, 4.3% in the South and 15.1% in the West. As mentioned above, however, all regions registered significant declines from a year earlier.

Link: US Census Bureau and the US Department of Housing and Urban Development Report

The U.S. Census Bureau and the Department of Housing and Urban Development today announced that privately-owned housing starts in April were at a seasonally adjusted annual rate of 523,000, down 10.6% from the revised March estimate. These new housing starts were also 23.9% below the rate from a year earlier.

Housing starts for single family homes in April were down 5.1% at 394,000 units while starts for multi-family units were down 28.3%.

The data indicated that housing starts for single family homes increased in the Northeast by 12.8% from March but declined in all other areas of the country. In the Midwest, they declined by 7.1%, the South showed a decrease of 7.6%, and the decrease in the West was 4.9%.

Newly authorized building permits, an indicator of future housing starts, decreased by 4.0% from March at a seasonally adjusted rate of 551,000. Single family authorizations in April were down 1.8% from March at a rate of 385,000 while authorizations for structures with more than two units were down 8.8%.

These decreases are attributable mainly to continued weakness in buyer demand and competition from foreclosures and sales of previously owned homes. An additional reason for the decline is the fact that home builders are finding it difficult to obtain credit to start housing projects.

Reflecting these facts, the number of homes under construction at the end of April was at the lowest level on record dating back to 1970.

Clearly, these numbers show continued weakness in the housing markets across the country. However, be aware that national and regional statistics are not a true gauge of your local real estate market. Each local market is unique and may differ greatly from these figures.

U.S. Census Bureau and the Department of Housing and Urban Development Report: Link

Home sales are on track to outperform last year, even though the market doesn’t have the benefit of the home buyer tax credit. This is thanks to sustained economic growth, the slowly recovering jobs picture, and historically high affordability conditions, NAR Chief Economist Lawrence Yun told a packed room on Thursday during the Residential Economic Update at the 2011 REALTORS® Midyear Legislative Meetings.

Although unemployment remains high at about 9 percent, the country is seeing steady job growth. More than 100,000 jobs are being created a month, and the U.S. could see 1.5 million net new jobs this year, Yun said.

Frank Nothaft, chief economist for secondary mortgage market company Freddie Mac, who spoke later at the same session, said he expects a bit more robust job growth, closer to 2 million, but both economists said the unemployment rate will remain high despite the new jobs because of the size of the hole that needs to be filled. More than 8 million jobs were lost during the 2008-09 recession, and new entrants to the labor force, such as recent college graduates, add another 2 million to the hole.

The Bureau of Labor Statistics reported yesterday  that there were 3.1 million job openings on the last business day in March of this year. The jobs openings rate of 2.3% was flat from the previous month after an increase in February. This marks the first time since November 2008 that job openings have been at or above 3.0 million for two consecutive months. The job openings level has trended up since the end of the recession in June 2009 (as designated by the National Bureau of Economic Research) but remains well below the 4.4 million openings when the recession began in December 2007.

Over the 12 months ending in March, hires (not seasonally adjusted) totaled nearly 47.6 million and separations (not seasonally adjusted) totaled 46.4 million, yielding a net employment gain of 1.2 million. These figures include workers who may have been hired and separated more than once during the year.  Nearly half of the hires and nearly half of the separations during these 12 months occurred in three industries: retail trade; professional and business services; and accommodation and food services. The large share of total hires and separations accounted for by these three industries reflects the size of the industries as well as their relatively high hires and separations rates.

While employment is certainly not back to where it was prior to the recession it is encouraging to note that it is on an upward trend. As you might expect, increasing employment is crucial to an improvement in the housing market and this is a step in the right direction.

To help explain why employment rates are trending higher, let’s take a look at the US stock market.  Both the Dow Jones Industrial Average and the S&P 500 are each up over 30% from last July. This increase has been fueled by increased corporate profits. As you might expect, as employers become more successful they must hire additional workers to meet the demand for their goods and services. The stock market is a good leading indicator for the economy in general and employment specifically. And with an improved employment picture, housing is likely to follow.

Stay tuned.

Link: The Bureau of Labor Statistics Report

• Under Agreement Activity is down 23.8% from April of 2010 and down slightly from March levels. However, activity is up 27.2% over the 3 month moving average indicating a slight improvement in the market.
• Middlesex County, while down 16.4% from a year ago, has seen substantial improvement over the past 3 month period.

• Closed sales activity is down 14.7% from April of 2010 and down slightly from March 2011.

• Significantly, there were 65% more properties that went under agreement in April than actually closed. This bodes well for closed sales activity in the coming months.

• Average sales prices are basically flat year-to-year….although Norfolk is up 24% while Suffolk is down 20%.

• Unsold listings are up slightly from a year ago, although they are up 13.7% over March 2011 levels and 25.1% over the 3 month moving average.

• The supply of unsold listings has increased significantly (35.8%) from a year ago: from a 4.7 month supply last year to a 6.79 supply currently.

• The number of new listings coming on the market has outpaced the rate of sales and, as a result, the monthly supply of unsold listings has increased to 6.39 months for the Greater Boston Market. Each county experienced an increase in unsold listings although Plymouth County continues to have an over-abundance of supply at 10.7 months.

For Complete Report- including National and Regional Market Statistics kindly (Click Here).

Last week, the National Association of Realtors announced that existing home sale transactions for March 2011 was up by 3.7% over February. Even though the volume level was 6.3% below last year’s level, March marked the 6^th month out of the last eight that showed an increase in sales volume. Additionally, pending home sales, which are an indicator of future activity, has trended up nicely since last June and is now about 20% above activity levels from last year.

Additionally, the Realtors Confidence Index, which measure the strength of the current housing market and expectations about the future, increased by 6% for single family homes while the rate for condominiums and town homes increased by 14.5% and 17.4%, respectively. While no one is wildly optimistic about the state of the real estate market, it does seem to be firming up in many areas.

On the negative side of the coin, the S&P/Case-Shiller Home Price Indexes released earlier this week shows that prices are still falling, down from their levels of a year ago. However, prices are still slightly above the bottom that was reached in April of 2009.

This continued softness in prices can be primarily attributed to the high levels of foreclosures and short sales that are occurring. In March, NAR reports that 40% of closed transactions were either foreclosures or short sales, with short sales comprising a record 9% of all sales. A short sale is when the price paid for the home is not sufficient to pay off the mortgage and the lender agrees to accept less than the full amount to satisfy the debt.

With all these factors in play, another phenomenon that has been reported on recently is that we are in the midst of a “false buyers’ market.” Typically, a buyers’ market occurs when there are more homes for sale on the market than there are qualified buyers to purchase them. However, many home sellers are unwilling or unable to reduce the price of their home to a level acceptable to potential buyers. So while these listings are counted in the inventory of homes for sale, the reality is that prospective buyers will ignore these listings as long as they are overpriced and the “effective” inventory is much lower.

There is a high demand for homes that are properly priced and we are seeing multiple offers and even bidding situations for those properties. So, as always, it is critically important that you are intimately aware of local market conditions as you develop your strategy to sell or purchase a home. Pricing your home properly will ensure you get the maximum value in the shortest period of time. Conversely, understanding the dynamics of your market will lower the risk that you will be outbid on the house of your dreams.

No longer is “location, location, location” the prime determinant of home values and marketability. For at least the past five years, it is unquestionably “timing, timing, timing.”

Timing relates specifically to the positive or negative impact on buyers and sellers in variable and rapidly shifting real estate market conditions, both nationally and at the local level. These rapid shifts can catch buyers and sellers unaware, costing them needless time, money an aggravation. For example, what might have looked like a fair price of $350,000 a month ago, could be $300,000 or even $400,000 today.

Supply and Demand

The health of any real estate market can best be determined by applying the age old theory of supply and demand. This relationship existing in specific real estate markets is easily computed by dividing the number of unsold home listings at the end of the month by the number of sales that took place the same month. This results in the current supply (in months) of unsold homes based on the current rate of sales. For example, say there were 1,200 unsold listings at the end of the month in Greater Metropolis with 200 sales the same month, which would result in a six month supply.

Real estate professionals have long held that supply and demand are pretty much in balance with a six month supply; what we call a “Balanced Market” with the number of buyers and sellers fairly equal and home values holding steady. But now, let’s talk about the impact to buyers and sellers on each side of the balance point. This is where timing is everything.

April 20, 2011

Sales of existing-home sales rose in March, continuing an uneven recovery that began after sales bottomed last July, according to the National Association of Realtors®.

Existing-home sales¹, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 3.7 percent to a seasonally adjusted annual rate of 5.10 million in March from an upwardly revised 4.92 million in February, but are 6.3 percent below the 5.44 million pace in March 2010. Sales were at elevated levels from March through June of 2010 in response to the home buyer tax credit.

Lawrence Yun, NAR chief economist, expects the improving sales pattern to continue. “Existing-home sales have risen in six of the past eight months, so we’re clearly on a recovery path,” he said. “With rising jobs and excellent affordability conditions, we project moderate improvements into 2012, but not every month will show a gain – primarily because some buyers are finding it too difficult to obtain a mortgage. For those fortunate enough to qualify for financing, monthly mortgage payments as a percent of income have been at record lows.”

NAR’s housing affordability index shows the typical monthly mortgage principal and interest payment for the purchase of a median-priced existing home is only 13 percent of gross household income, the lowest since records began in 1970.

Greater Boston RE Market Heats Up

Sales Activity Increases 37% Since December

Remains a Healthy “Balanced Market”

Supply of Unsold Listings 5.6 Months vs 8.4 Months Nationally

NORWELL, MA, ISSUED APRIL 6, 2011. . . Data released today by HouseSavvy (www.housesavvy.com), a real estate consulting organization, documents that the Greater Boston Real Estate Market is experiencing a recent surge in sales activity while continuing to be one of the healthiest markets in the country. The “Greater Boston Market” consists of the 167 towns and cities within the six counties surrounding Boston: Bristol, Essex, Middlesex, Norfolk, Plymouth and Suffolk.

Although March year-to-year sales activity has fallen 14.7 % (2,942 to 2,509) the sales activity increase from December to March has increased a substantial 37% (from 1,830 to 2,509) – much more of a seasonal increase than normal. This short-term positive indicator is supported by a very positive longer-term trend, and that is that the average sale price in the Greater Boston Market has even increased 3.2% March year-to-year (from $371,776 to $383,645).

Washington, March 28, 2011

Pending home sales increased in February but with notable regional variations, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator, rose 2.1 percent to 90.8, based on contracts signed in February, from 88.9 in January. The index is 8.2 percent below 98.9 recorded in February 2010. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.

Lawrence Yun, NAR chief economist, says it’s important to look at the broader trend. “Month-to-month movements can be instructive, but in this uneven recovery it’s important to look at the longer term performance,” he said. “Pending home sales have trended up very nicely since bottoming out last June, even with periodic monthly declines. Contract activity is now 20 percent above the low point immediately following expiration of the home buyer tax credit.”

Yun notes there could have been some weather impact in the February data. “All of the regions saw gains except for the Northeast, where unusually bad winter weather may have curtailed some shopping and contract activity.”

The PHSI in the Northeast fell 10.9 percent to 65.5 in February and is 18.4 percent below a year ago. In the Midwest the index rose 4.0 percent in February to 81.1 but is 15.9 percent below February 2010. Pending home sales in the South increased 2.7 percent to an index of 100.3 but are 5.3 percent below a year ago. In the West the index rose 7.0 percent to 105.6 and is 0.6 percent higher than February 2010.

“We may not see notable gains in existing-home sales in the near term, but they’re expected to rise 5 to 10 percent this year with the economic recovery, job creation and excellent affordability conditions providing confidence to buyers who’ve been on the sidelines,” Yun said.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined as well as the first of five consecutive record years for existing-home sales; it coincides with a level that is historically healthy.

Each February, NAR Research conducts a normal review of PHSI seasonal adjustment factors and fine-tunes monthly data for the past three years; revisions are posted in the Research area of Realtor.org.

NOTE: Existing-home sales for March will be reported April 20 and the next Pending Home Sales Index will be released April 28; release times are 10:00 a.m. EDT.

Information about NAR is available at www.realtor.org. This and other news releases are posted in the News Media section. Statistical data, tables and surveys also may be found by clicking on Research.