The housing market continues to surprise everyone. Today, the S&P/Case-Shiller Home Price Report came out much better than expected, showing that the U.S. National Home Price Index improved second quarter over first quarter and prices rose for the second month in a row. This news, along with the Existing Home Sales Largest Monthly Gain Record report, is showing us that ample supplies, low mortgage rates and tax credits are spurring home sales in a lot of U.S. markets. And this is leading to higher home prices.
(I’m so glad I have my Free Live Teleconference and Webinar “Foreclosure Wholesale Buying Secrets” Tomorrow Night so I can share with you HOW you can get started buying and selling foreclosures for profit, without using any of your own cash or credit, right now. More Here.)
Nationally, prices fell 14.9 percent in the second quarter from a year earlier, but was the smallest drop in a year. The measure increased 2.9 percent from the first quarter, the first gain in three years.
“For the second month in a row, we’re seeing some positive signs,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “The U.S. National Composite rose in the 2nd quarter compared to the 1st quarter of 2009. This is the first time we have seen a positive quarter-over-quarter print in three years. Both the 10-City and 20-City Composites posted monthly increases, as did most of the cities. As seen in both seasonally adjusted and unadjusted data, as well as the charts, there are hints of an upward turn from a bottom. However, some of the hardest hit cities show continued weakness.”
The S&P/Case-Shiller U.S. National Home Price Index – which covers all nine U.S. census divisions – recorded a 14.9% decline in the 2nd quarter of 2009 versus the 2nd quarter of 2008. While still a negative annual rate of return, this is an improvement over the record decline of 19.1% reported in the 1st quarter of the year. The 10-City and 20-City Composites recorded annual declines of 15.1% and 15.4%, respectively. These are also improvements from their recent respective record losses of -19.4% and -19.1% and the smallest drop since April 2008.
The index was forecast to fall 16.4 percent after a 17 percent drop in the 12 months ended in May, according to the median forecast of 31 economists surveyed by Bloomberg News. Estimates ranged from declines of 15.7 percent to 17.1 percent.
Lower prices and government stimulus efforts have made homes more affordable to first-time buyers, spurring increases in sales that is stemming the slide in property values. These gains in housing and stocks will serve to speed the process of an overall economic recovery.
“The sharp freefall in prices is over,” said Michelle Meyer, an economist at Barclays Capital Inc. in New York. “People are entering the market and that is starting to normalize prices. It’s a clear positive.”
As of the 2nd quarter of 2009, average home prices across the United States are at similar levels to what they were in early 2003. From the peak in the second quarter of 2006, average home prices are down 30.2%. The 10-City and 20-City Composites posted their second consecutive monthly increases. Both indices were up 1.4% in June over May, and up 0.5% in May over April, the second consecutive gain and the biggest since June 2005, today’s report showed.
Eighteen of the 20 metro areas saw improvement in their annual returns compared to those of May. Looking at the monthly data, the same 18 metro areas reported positive returns in June. Cleveland and San Francisco had the biggest monthly gains. All of the 20 cities in the S&P/Case-Shiller index showed a year-over-year price decrease in June, led by a 32 percent plunge in Las Vegas. Dallas showed the smallest decline at 2.2 percent.
There are many more signs that the housing crisis is behind us…
*Existing home sales in July jumped to the highest level in almost two years, boosted by lower prices, tax credits for first-time buyers and near-record-low borrowing costs, according to figures from the National Association of Realtors. (Full Report: Existing Home Sales Largest Monthly Gain Record.)
*Many of the hardest hit areas are showing big improvements:
California Home Sales Jump Again; Median Price Up 4th Month
*New-home sales, due tomorrow from the Commerce Department, probably rose in July for the fourth straight month, economists surveyed by Bloomberg project. (Last Months Report Here: New Home News Today- What does it mean?)
*Demand has already improved enough for some construction companies to consider cutting back on discounts and incentives. Toll Brothers Inc., the largest U.S. luxury homebuilder, said contracts rose in the third quarter from a year earlier for the first time since 2005.
“As the supply of unsold housing inventory shrinks nationwide, and if consumer confidence continues to improve, we should see stronger demand,” Robert Toll, chief executive officer of the Horsham, Pennsylvania-based company, said on an Aug. 12 conference call. “It has already positively impacted our pricing power as we are reducing incentives in many markets.”
All eyes are on the housing market recovery now clearly in place. Home buyers are flocking to the market grab their $7500 tax credit gift from the government before it is gone December 1st. That incentive along with our historically low interest rates and prices down substantially from the peak has made owning a home more affordable now than we’ve seen since the 1970′s. With foreclosures are at all time highs this is a great time for investors to buy low and sell quickly to these eager buyers for some great profits. You need to jump in now before we lose this incredible window of opportunity!
Learn how, this Wednesday, to get started, without using any of your own cash or credit, buying and selling foreclosures for profit for FREE…. but you must register in advance as we have limited capacity from our conference provider. Live Teleconference and Webinar “Foreclosure Wholesale Buying Secrets” this Wednesday, August 26th, 6pm PDT, 9pm EST . CLICK HERE to register or call 800-310-7730 x2. Talk to you tomorrow!
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