Existing-home sales rose in April with strong buyer activity in lower price ranges, according to the National Association of REALTORS®. Existing-home sales – including single-family, townhomes, condominiums and co-ops – increased 2.9 percent to 4.68 million units in April from 4.55 million units in March, but 3.5 percent below the April 2008 level.
Lawrence Yun, NAR chief economist, said first-time buyers continue to influence the market but there also is a seasonal rise of repeat buyers. "Most of the sales are taking place in lower price ranges and activity is beginning to pick up in the mid-price ranges, but high-end home sales remain sluggish," he said. "The Federal Reserve needs to help restore liquidity for the jumbo mortgage market by buying these loans under the TALF program."
"Because foreclosed properties will likely be released into the market over the rest of year, it is critical that distressed homes be quickly cleared from the market," Yun said. "Fortunately, home buyers are being attracted to deeply discounted prices and are bidding up many foreclosed listings, particularly in California, Nevada, and Florida – this will set the stage for healthy market conditions going forward."
A NAR survey in April showed first-time buyers declined to 40 percent of transactions, implying more repeat buyers are entering the traditional spring home-buying season. It also showed the number of buyers looking at homes has increased 14 percentage points from a year ago. "This is consistent with our forecast for home sales in the latter part of the year to be 10 to 20 percent higher than the second half of 2008," Yun said.
"Now is a perfect time for first-time and for repeat buyers," said Julia Keady, president of the Silicon Valley Association of REALTORS®. "Moving up is a great idea right now. If you are thinking of moving up, prices are down slightly which will allow you to buy a right-sized home and save on property taxes. By taking advantage of the superior interest rates available now, you may be able to save many thousands of dollars over the life of your loan."
The national median existing-home price for all housing types was $170,200 in April, which is 15.4 percent below 2008. Distressed properties, which accounted for 45 percent of all sales in April, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes.
NAR President Charles McMillan said conditions are optimal for buyers with good jobs and long-term plans. "We have record low mortgage interest rates, a wide selection of homes and affordable prices in most areas," he said. "When you add the $8,000 first-time buyer tax credit, it's hard to imagine a better time to make an investment in your future though homeownership."
Single-family home sales rose 2.5 percent to 4.18 million in April from March, but are 2.8 percent below March 2008 sales. The median existing single-family home price was $169,800 in April, which is 14.9 percent below a year ago. Existing condominium and co-op sales increased 6.4 percent to annual rate of 500,000 units in April from 470,000 in March, but are 9.4 percent lower than a year ago. The median existing condo price was $173,900 in April, down 18.5 percent from April 2008.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please contact Rose Meily at SILVAR Public Affairs, email , or phone (408) 200-0109.