RISMEDIA, Jan. 1, 2008-Existing-home sales rose slightly in November, indicating stabilization in housing in the wake of mortgage disruptions earlier this year, according to the National Association of Realtors®.

Total existing-home sales - including single-family, town homes, condominiums and co-ops - rose 0.4% to a seasonally adjusted annual rate1 of 5.00 million units in November from an upwardly revised pace of 4.98 million in October, but are 20.0% below the 6.25 million-unit level in November 2006.  Lawrence Yun, NAR chief economist, said the market appears to be stabilizing.

“Near term, existing-home sales should continue to hover in a narrow range, just as they have since September, and that’s good news because it’ll be a further sign that the housing market is stabilizing,” he said. “Mortgage interest rates are near historic lows and the most current data shows decelerating price declines, along with a modest reduction in the number of homes on the market.”

Disruptions in mortgage availability and pricing peaked in August, which caused sales to slow in subsequent months.

The national median existing-home price2 for all housing types was $210,200 in November, down 3.3% from November 2006 when the median was $217,300, but there remains a downward drag on the national median as the mix of closed sales has shifted away from expensive markets.

“Just like the weather, there are large local variations in home prices,” Yun said. A quarterly examination of price performance on a metropolitan basis shows nearly two-thirds of metro areas are showing price increases. Among the many metros experiencing healthy local price gains are Farmington, N.M.; Reading, Pa.; Columbia, S.C., and Fargo, N.D.

Total housing inventory declined 3.6% at the end of November to 4.27 million existing homes available for sale, which represents a 10.3-month supply3 at the current sales pace, down from a 10.7-month supply in October. “Inventory is still high, and further reduction in prices may be required in some areas to induce buyers back into the market,” Yun said.

NAR President Richard Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, California, said that Congress should expand affordable financing. “Consumers have some choices with safer conventional financing, but raising the limit on conforming loans would significantly revive home sales,” he said. “This would help creditworthy buyers in hard hit regions like California and Florida by greatly increasing access to low-interest-rate mortgages. NAR, as the leading advocate for homeownership, strongly urges lawmakers to act quickly on this important measure.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 6.21% in November from 6.38% in October; the rate was 6.24% in November 2006.

Single-family home sales rose 0.7% to a seasonally adjusted annual rate of 4.40 million in November from 4.37 million in October, but are 19.9% below the 5.49 million-unit pace in November 2006. The median existing single-family home price was $208,700 in November, down 3.7% from a year earlier.

Existing condominium and co-op sales slipped 1.6% to a seasonally adjusted annual rate of 600,000 units in November from 610,000 in October, and are 20.6% below the 756,000-unit level in November 2006. The median existing condo price was $221,100, down 0.7% from in November 2006.

Regionally, existing-home sales in the West increased 10.3% in November to a level of 960,000, but are 25.0% below a year ago. The median price in the West was $325,800, which is 6.8% lower than November 2006.

In the Midwest, existing-home sales were unchanged at an annual rate of 1.18 million in November, but are 16.9% below November 2006. The median price in the Midwest was $163,000, down 0.5% from a year ago.

Existing-home sales in the South declined 2.0% to an annual rate of 1.99 million in November, and are 19.4% below a year ago. The median price in the South was $174,200, which is 2.5% below November 2006.

Existing-home sales in the Northeast fell 3.3% to an annual pace of 870,000 in November, and are 19.4% below November 2006. The median price in the Northeast was $258,300, down 3.2% from a year ago.

For more information, visit www.Realtor.org.

RISMEDIA, Dec. 17, 2007-Although much of the housing market is in a slump, this is still a good time for most to buy a home.

Even though many economists are predicting further drops in home values in most areas, today is still an excellent time for most of us to buy a home. The direction of area home values won’t make much difference to homeowners who will both buy and sell in the same area, and other important factors very much favor buying a home now.

Most move up buyers buy their next home in the same area. Whether overall home values in that area are going down, up, or holding their own, other homes in the area will be similarly impacted. Current local home values and any future changes in those home values, whether negative or positive, will therefore have the same effect on a home they might buy as they will have on their current home when they sell it. For that reason the direction of housing values in any given area is of small consequence relative to other factors for those homeowners, who should not let declining values get in the way of buying their next home.

If you are a prospective first time buyer in one of the few appreciating markets, buying sooner rather than later certainly makes sense. Similarly, if you live in an area where home values are falling and plan to relocate to another area where prices are rising, that is a good reason to buy and sell (or sell and buy) as soon as you can, before the gap widens further.

Holding off on a home purchase due to current market conditions may make sense in some cases only for a much smaller group - prospective first time buyers who live in an area where further home price declines are likely. The same is true for those living in the relatively few areas where homes are appreciating and who plan to relocate to other parts of the country where home prices are still falling. Unfortunately some homeowners now owe more money on their mortgage than their home is worth because of dropping home values. They may be unable to afford to sell at this time regardless of local market conditions unless they have sufficient savings to make up the difference.

There are several reasons that today is a particularly good time to buy a home for most of us. The selection is as great as it will ever be, mortgage rates are still relatively low by historical standards, and costs of any desired remodeling/upgrades are a lot less because of the downturn in new home construction and the resulting glut of building supplies.

With inventories of homes for sale at all time highs in many places, there’s a much greater chance that you’ll be able to find a home that’s ideally suited for your needs. That’s a very big plus because homeowners spend an average of nearly a decade in their home before they sell it. The shortage of inventory and high home prices that existed up until 2005 forced many buyers to make many compromises on home features at that time. No doubt many of them wish that some of the nicer homes for sale in their neighborhood today had been available at that time. Today’s home buyers will have to make far fewer, if any compromises, and many will be able to pay less for a home that’s much better suited to their needs.

If today’s home buyers decide to make some upgrades and improvements to their next home they can usually do it for substantially less than it would have cost several years ago. The rate of new home construction has dropped precipitously, and prices of many building materials have dropped substantially as a result. Prices for oriented strand board, which is used for exterior wall sheathing, roof sheathing and subfloors, is down 40% from late 2005, according to the National Association of Home Builders. Lumber used for framing floor and roof joints retreated 24%, in cost according to NAHB. Drywall prices are down 35% from late last year, according to United States Gypsum Company.

Construction labor costs are down as well, as many home builders have decided to become remodeling contractors until the market for new homes improves. The remodeling market has also slowed down somewhat. With many home builders recently reinventing themselves as remodeling contractors, price competition in that market is very intense today. Only a few years ago you were lucky if half the contractors returned your call, and a few actually showed up and subsequently gave you a proposal. That has changed dramatically.

“When we remodeled our kitchen and bathrooms several months ago every contractor we called showed up, and their bids were very competitive,” said American Homeowners Foundation President Bruce Hahn. “Many of them were ready to start immediately, and none of them balked when we told them we wanted them to sign a comprehensive contract specifying all of the details of the project,” he added. (Note: Judging from the continuing number of complaints regarding remodeling contractors, the competition has yet to drive incompetent and/or dishonest contractors out of the business.

Lastly, mortgage rates are still competitive by historical standards. Although lenders have become more particular about who they will lend to, and the gap between mortgage interest rates for those with excellent credit and those with marginal credit histories has widened, mortgages with 30 year fixed rates are still affordable for a majority of home buyers. If you are looking down the reset barrel of an adjustable rate mortgage on your current home, you will also be able to resolve that problem and avoid the higher mortgage reset interest rate with a fixed rate loan on your next home.

The bottom line: Trying to employ market timing in real estate entails many of the same risks as attempting market timing in the stock market, as many real estate flippers who flocked to the market in the middle of this decade learned the hard way. Despite all the current doom and gloom in the housing market, it’s still a great time for most of us to buy a home!

Courtesy of the American Homeowners Foundation and the American Homeowners Grassroots Alliance, www.AmericanHomeowners.org “

The Top Ten Reasons It's a Great Time To Buy Real Estate! - 12/4/07