Seeing signs of improvement

The National Association of Realtors (NAR) reported last week that existing-home sales had leveled off in March, while home prices “moderated.” Sales gains were reported in the Northeast and Midwest, but declines were seen in West and South sales.

Existing-home sales in the Northeast increased 9.1% in March, but are 4.8% below those of March 2013.

The median price in the Northeast rose 3.2% from last year. This is of note, as the Northeast’s improvement leads the other regions of the country.

Total completed home sales of existing homes in all types slightly decreased, 0.2% in March as compared with February of this year.

This is 7.5% less than in March of 2013. The reason provided by NAR’s chief economist is that “price growth is rising faster than historical norms because of inventory shortages.”

Across the nation the median existing-home price for all types of housing increased 7.9% from this time last year. Foreclosures and distressed sales accounted for 14% of March sales. This is down from 16% in February and 21% in March 2013. It is anticipated that the market will improve in the coming months with more jobs and better weather. It is also expected that rising home prices will enable homeowners to increase their equity positions and be more inclined to list their homes. It is also forecast that distressed homes will decline by the end of this year.

In March, 10% of sales were foreclosures and 4% were short sales. Foreclosures sold for an average discount of 18% below market value in March and short sales were discounted 12%.

The total housing inventory in the United States at the end of last month increased 4.7% and represents a 5.2-month supply at the current sales rate. This is an increase from a five-month supply in February. Inventory available for sale is 3.1% above a year ago, when there was a 4.7-month supply.

As far as time on the market for a home, it was 55 days, which is a decrease from 62 days in February and a decrease from 62 days on the market when compared to March 2013.

Short sales sold in a median of 112 days in March, foreclosures sold in about 55 days and non-distressed homes sold in 53 days. Of the homes sold in March, 37% were on the market for less than 30 days.

First-time buyers accounted for approximately 30% of sales in March. This is an increase from 28% in February. More stringent lending policies are being eased, so these buyers are able to perform.

In all markets, including Greenwich, there is a shortage of inventory in entry-level homes. The hope is that the rise in new construction will help because it will enable people to upgrade to another home, making available their existing homes.

Cash buyers accounted for a third of sales transactions in March, down from 35% in February compared to 30% in March 2013.

Investors who usually buy homes with cash accounted for 17% of home sales in March, which is down from 21% in February and 19% in March of 2013.

 

Mary Ann Clark is a Realtor with Coldwell Banker at 177 West Putnam Avenue in Greenwich. Questions or comments may be emailed to [email protected]

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