This is a monthly survey I participate in for Credit Suisse. I wanted to share the information. Every thing shows a real estate market improving. The comment below that there is pressure on the high end as entry level home prices increase, is exactly what we are experiencing here in the Phoenix real estate market.
There comments below about banks holding back their foreclosures/REO/Bank Owned should be qualified with the fact banks are approving short sales at 3 times the rate now than earlier this year here in Phoenix. A short sale saves the bank time, money and effort. I believe this is a good portion of why less homes are being foreclosued on. The other is the combination of loan modifications and work outs being done. I am hearing many more people tell me they got approval from the banks for modifications.
Please call or email me if you have any questions, especially if you are in foreclosure. Let’s stop the bank and try to keep you in your home!
Just my opinion…Jeff Cameron
Monthly Survey of Real Estate Agents
CHANNEL CHECK
Solid Traffic, Driven by First-time Buyer Tax Credit
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Traffic up slightly; highest demand levels seen in investor-heavy
markets. Our Monthly Survey of Real Estate Agents indicated another
increase in traffic levels in August, with the key theme being buyers moving forward to take advantage of the first-time buyer tax credit before it expires at the end of November, along with demand from investors looking for foreclosures.
Our buyer traffic index inched up to 44.5, from 43.4 in July. The traffic index has shown traffic near the expectations of agents (a reading of
50) for five months. The foreclosure heavy markets continue to see multiple bids on foreclosure sales and a heavy investor presence.
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Arizona, California, Florida, New York, and Washington, D.C. saw the
highest traffic levels. In general, it was the typical foreclosure heavy areas that saw the highest levels of traffic, but we also saw noticeable
improvement in Atlanta, Chicago, Los Angeles, and New York. For Atlanta and Chicago this is a quick rebound after one weak month. The
improvement in NY likely reflects stronger demand, as a result of
improvement in the financial markets, and some pent-up demand after many months of limited activity.
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First-time buyer tax credit helping buying to get “off the fence”.
Throughout the markets, we heard frequent mention of first-time buyers making purchases now (or looking with the intent to make a purchase shortly) based on the first-time buyer tax credit. We hadn’t sensed a dramatic impact from this in prior months, but the coming expiration of the tax credit (closings must occur by November 30th, meaning that most contracts should be signed prior to the end of September or early October) has brought more of these buyers into the market. The expiration of the credit could create a lull in demand (if demand is pulled forward), but we think that the improving tone to the markets and positive momentum are likely to mean more to buyers than would the $8,000 tax credit.
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Price declines still occurring on higher-priced homes, but low end
stabilizing. Our price index moved slightly higher in August to 34.5, from
33.6 in July. In many markets, we heard of multiple bids on foreclosures and low-end homes, with prices appearing to have bottomed for those price points. Agents indicated rising prices over the past 30 days in the Inland Empire, Los Angeles, and Washington, D.C., with stable prices in Dallas, Ft. Myers, and near-stable in Phoenix. Agents saw the weakest pricing trends in Atlanta, Austin, Charlotte, and New York.
Phoenix, AZ – Further Signs of Price Stabilization at
Low End Fuel Calls of a Bottom
(11,549 single-family permits in 2008, 4th largest market in the country)
First-time buyers and investors continue to snap up deals. Buyer traffic remained modestly above agents’ expectations (which likely aren’t so low anymore following the strong demand in recent months), as our traffic index slipped to 55 in August from 58 in July but remained above a neutral reading of 50. Agents continued to cite strong demand from first-time buyers and from investors. “Lots of investors and first-time buyers are taking advantage of the low prices. It’s widely perceived (and reported in the media) that we’ve probably hit bottom,” according to one agent. Some agents continued to express frustration with the way banks are handling REO. One commented, “The banks are sitting on their foreclosures, even the investors are getting fed up. Most foreclosures listed $120,000 and under are getting 10 or more offers in two to three days. A lot of foreclosures are now selling above asking price!” Another said, “The backlog of pending foreclosures are postponed repeatedly, delaying or pacing the process.” This has resulted in lower reported inventory levels, at least temporarily.
Prices stable again in August as low-end properties continue to see multiple bids.
Home prices remained steady for the second straight month in August; our price index fell to 48 from 52, but remained essentially in-line with a neutral reading of 50. Agents said multiple bids are the norm on any decent foreclosure or low-priced home, with some selling above the original price banks are listing them at. This, along with many foreclosures being delayed and not hitting the market, has reduced inventory levels, although these foreclosures ultimately will come back to the market in the coming months and may derail the current sense of price stability. Our home listings index fell to 62 in August from 75 in July, with any reading above 50 indicating lower inventory levels.
Comments from real estate agents:
■ “Buyers are trying to secure a home by Nov. 30th to receive the $8,000 tax credit.”
■ “Investors and first-time buyers are entering the market and purchasing in the lower price ranges.”
480-652-2004