Friday, July 13, 2012

July 2012-Market Update

July 2012   Market Update
The national housing market continues to recover, evidenced by a balanced supply of inventory as well as improvements in home prices and the number of homes sold. The median home price increased again this month from last month, reaching $182,000 compared to $155,600 just three months ago, a 17.4% increase.
Recently, a growing trend facing certain regions is tremendous inventory shortages. NAR President Moe Veissi advises buyers in markets with limited supply who are seeing multiple bidding and competition between first-time buyers and cash investors that, “It’s extremely important [for buyers] to listen to the advice of your agent and perform all the due diligence that you would normally do in a more balanced market.”
With rental rates and buyers’ confidence on the rise due to record-low mortgage rates, the market is heating up, making now one of the most favorable times in history to buy a home. 

Home Sales

in millions
While home sales declined 1.5% from last month to 4.55 million units, year-over-year increases are 9.6% higher. Lawrence Yun, NAR chief economist, states, “home sales have moved markedly higher with eleven consecutive months of gains over the same month a year earlier.”

Home Price
in thousands
Thanks to a decline in distressed properties on the market (which includes short sales and foreclosures that traditionally sell for 15%–20% less on average compared to non-distressed homes), the median home price rose 5.1% from last month, and 7.9% compared to a year earlier to $182,600. This is the third consecutive month of year-over-year price gains, which hasn’t been seen since March to May of 2006, a period of peak performance in the housing market.

Inventory- Month's Supply
in months
Housing inventory remained stable with a 6.6-month supply on the market, 20% below year-ago levels. This marks the sixth consecutive month of inventory at a 6-month supply, the threshold for a balanced market, giving both buyers and sellers an equal advantage. Movement out of the three-year buyer’s market is imperative toward reaching a full-scale housing market recovery.

Source: National Association of Realtors
Interest Rates
Mortgage rates around 3.66% continue to boost home affordability—some of the lowest rates on record since 1971. These rates may be as close to the bottom as they will get, adding to the urgency to buy a home now while these record lows hold.

This Month's Video

Topics For Home Owners, Buyers & Sellers
As many markets continue to heat up, both buyers and sellers are facing multiple offer situations. If you’re a buyer in a bidding war, here are some tips to give you an edge:
  • Get pre-approved for your loan. Get pre-approved by a local lender and attach a copy to your offer.
  • Think unevenly. An uneven offer price such as $251,000 instead of $250,000, will stand out from the others, and it may just beat an offer that came in at a slightly lower figure with an even bid.
  • Be flexible. The fewer contingencies and the cleaner the offer, the better the chance you have to win a bidding war. Have your agent find out the seller’s ideal closing date, and offer to make it happen.
  • Hide your hand. Determine the highest bid you’re trying to beat, and try to come in over that rather than offering the most you can afford.
  • Don’t get distracted. If you find yourself caught up in the excitement of a bidding war, step back and reassess if the home has everything you want and need.
Contact me, your local real estate expert, for information about what's going on in our area.
Brought to you by KW Research. For additional graphs and details, please see the This Month in Real Estate PowerPoint Report.
The opinions expressed in This Month in Real Estate are intended to supplement opinions on real estate expressed by local and national media, local real estate agents and other expert sources.  You should not treat any opinion expressed in This Month in Real Estate as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion.  Keller Williams Realty, Inc., does not guarantee and is not responsible for the accuracy or completeness of information, and provides said information without warranties of any kind.  All information presented herein is intended and should be used for educational purposes only.  Nothing herein should be construed as investment advice.  You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.  All investments involve some degree of risk.  Keller Williams Realty, Inc., will not be liable for any loss or damage caused by your reliance on information contained in This Month in Real Estate.
Smitha and Rahul Ramchandani are a licensed real estate Broker-Salesperson/Sales Representative Team with Keller Williams in New Jersey. They are Buyer Specialists and a Home Marketing Experts. You can reach Smitha and Rahul and their team online at:
Their team specialize in North Central New Jersey including towns such as Boonton, Chatham, Chester, Convent Station,Denville, East Hanover, Florham Park, Hanover, Harding Twp., Mendham, Montville, Morristown, Morris Plains,Morris Twp., Mountain Lakes, Parsippany, Randolph, Rockaway, Whippany