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By Mike Jacka - Monday, August 03, 2009

In the news lately the headlines are all about the higher than expected home sales. June saw an 11% increase in the number of homes sold compared to this time last year. However, if you listen to the reports or read the articles, buried somewhere in the story will be the caveat that while the number of home sales is up and that prices in some areas are stabilizing or in some places actually decreasing, is that the available homes for sale is at the lowest levels in a decade.

So why have home sales increased? There are a few reasons to explain the home sales increase as of late and the increase in sales prices as well.

  • The $8,000 first time home buyers tax credit expires on December 1, 2009. So anyone who can take advantage of this has to do so now, because no one knows for sure whether or not congress will extend the tax credit.
     
  • Because of all the foreclosures, many investors are buying up REO’s as quickly as they can.
     
  • Fannie Mae and Freddie Mac had a moratorium on foreclosures from November thru March. They started filing foreclosures again in April, so those properties will not start hitting the market until later this year.
     
  • A lot of homeowners who normally would be selling simply can’t sell their houses right now because they owe more than the properties would sell for, so they are staying put for now.
     
  • Some homeowners, who could actually sell right now, know that they couldn’t qualify for a new mortgage.

I have talked to a lot of homeowners who would love the opportunity to buy a move up property right now because they could get such a good deal in today’s market. The problem is that they can’t qualify for a new mortgage today, even if they could sell their property right now.

All these reasons have caused a shortage of inventory right now and there are a lot of buyers trying to take advantage of the good deals from the Banks. This has also caused a multiple offers situation on most properties.

I believe that this will last till later this year. When the tax credits either expire or extend, there will no longer be a rush to close before the deadline. Prices will have stabilized and even increased to a point where some homeowners will now be able to sell without having to write a large check at closing and the bank REO’s will start flooding the market. And if things go well, the credit markets will begin to loosen up, allow even more people to qualify for a mortgage so some of those move-up buyers might also be able to start selling their current houses.



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Melia1342@gmail.comI enjoy reading posts like this. Thanks

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Marilyn Logsdon11/29/2009

miniroot042@hotmail.comLooks like it hit the spot. good post.

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adina8712@yahoo.comThe lucky ones who have enough money for a new home can make a great deal if they buy now. Soon the properties prices will go up, so this is the right time to invest in real estates.

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praveen.hkcs@gmail.comPacking may seem like a huge chore but you have to do it anyways and the less personal things in the rooms the better. Pack all non essentials that are not purely decorative.even pack the frames with family pictures, it is distracting to buyers.

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wewanttraffic@gmail.comReal estate is an exciting, lucrative, dynamic business. Go in armed with the facts and you may find yourself reaping handsome reward

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bjs5025@gmail.comI feel that banks will have no choice but to get rid of property as fast as they can to stay solvent. We will see the year of the short sale in 2010.

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sabrefiretest@gmail.comI talk to a friend in the real estate business and he tells me banks are starting to really push 'short sales.'

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grahamhorsefall@yahoo.comLets hope that it is going to stay this way!

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wilsongary98@yahoo.comYes it seems as though house prices are steadily on the increase! Will they stay like that? It would help massively if the banks were to start lending again.

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duluthmartin@yahoo.comYes, I agree with you, it seems to me that this should have been expected, and many predicted it.