Local Real Estate Comments and Ramblings

head_left_image

NAR Spin On Existing Home Sales Report Damages REALTOR Image

My friend Joe Manausa from Tallahassee just wrote this great post on the National Association of Realtors spin on the recent housing numbers.

We saw a similar situation here in Cobb County Ga.  Prices through April did pretty well but I think it all artificially fueled by the now expired tax credit.

There are currently 980 Cobb foreclosure listings in the Marietta Daily Journal.  Not all of these will end up foreclosing but many of them will. Add to that all of the current short sale listings, divorce, job transfers and then normal, traditional listings.  It just does not translate to any meaning market absorption that lead to a decrease in supply.

Every month on the 25th, the National Association of REALTORS® releases the Existing Home Sales Report which includes single family detached homes, condominiums, townhouses and co-ops. Of all the real estate reports that the NAR produces, this one best identifies the strength and direction of the national housing market.

The April Existing Home Sales Report was positive, showing a 7.6% increase over April of the previous year. Lawrence Yun, NAR chief economist, said the gain was widely anticipated.

“The upswing in April existing-home sales was expected because of the tax credit inducement, and no doubt there will be some temporary fallback in the months immediately after it expires, but other factors also are supporting the market,” he said. “For people who were on the sidelines, there’s been a return of buyer confidence with stabilizing home prices, an improving economy and mortgage interest rates that remain historically low.”

The national Existing Home Sales Report jibes with what we are measuring locally in the Tallahassee real estate market. Actually, the Tallahassee housing market saw a 35% gain in year over year home sales.

Future Outlook For Existing Home Sales

As we saw in the report, Yun expects some “temporary fallback” due to the ending of the Homebuyer Tax Credit, but I think this might just be a gross under-estimate of what will occur. Based upon our measurement of the real estate absorption rate in Tallahassee, it will come down to how aggressively home sellers work to motivate the thin pool of buyers in the market.

Yun further adds:

“Although inventory levels remain above normal and much of the gain last month was seasonal, the housing price correction appears essentially over,” Yun said. “In fact, a majority of the markets have seen price gains recently. A return to old-fashioned responsible lending and buying will help the housing market avoid disruptive and painful bubble-bust cycles.”

This is market spin at its finest. In the very same report where he acknowledges that inventories are rising, he also predicts the end of the housing price corrections? I think not.

Twisting The Truth About The Impact Of The Homebuyer Tax Credit

I have reported many times in the past that the end of the Homebuyer Tax Credit will result in a very predictable rise in the median home price in the U.S. We must remember that real estate appreciation cannot be measured by tracking median home price averages, it must be tracked by measuring a sampling of home sales and comparing them to previous sales of the same properties.

  • The Homebuyer Tax Credit stimulated the bottom end of the market more so than the top, thus creating a drop in the median home price in the U.S.
  • The end of the Homebuyer Tax Credit will end the run on the lower end of the market, thus resulting in a rise in the median home price in the U.S.
  • The NAR will use this phenomenom to announce “Homes are appreciating” when in fact the balance of the market is just being restored
  • Home prices will continue to drop, even as the median home price returns to a higher level
  • A simple study of Supply and Demand in Housing is a better way to forecast future values in real estate

When we use median home price movement in the US, we are not comparing “apples to apples,” rather we are tracking the current trend of what home buyers are choosing. The median home price reports do not report the changes in the median home size and the median home amenities, it just reports what buyers are buying.

If you really want to know where values are heading, you have to study the relationship between supply and demand in real estate. Just as is the case in any commodities market, the over-supply of homes will pressure home sellers to drop their prices to attract more buyers. Housing inventories are rising, both locally and nationally, and this anticipated market movement will bring even more pressure to home values.

If you have a home to sell, sell it now. With prices dropping, waiting only means that you will get less in the near future. If you do not need to move now, settle in and enjoy your home. Take your home off of the market and “do your part” in reducing the supply of homes for sale. Home values will start to appreciate (when the housing market hits equilibrium), and you can then decide to sell your home when the value recovers to where you need it to be.

*****

 

 


Bob Southard
Broker - Owner  Atlas Realty Service LLC #75911

O:678-439-SOLD(7653)

CALL ME DIRECT: 770-656-9134

Buy a home, Sell a home, in Powder Springs, Marietta, Kennesaw, Acworth, Smyrna, Dallas, Hiram,and Cobb, Paulding, Douglas, North Fulton, South Cherokee, County, Ga. Call me for all of your real estate needs.

Visit my website

www.AgentBobSells.com

 

bob@agentbobsells.com

Call me for all of your Real Estate needs

678-439-7653

Copyright © 2008,2009,2010,2011,2012,2013,2014,2015,2016,2017,2018 By Bob Southard, All Rights Reserved

 

Follow Bob on Twitter , FaceBook, and LinkedIn

 

Agents! $19.95 for 800 capture,fax,virtual tours,showing feedback,more!

 

Comment balloon 2 commentsBob Southard • May 25 2010 09:20AM
NAR Spin On Existing Home Sales Report Damages REALTOR Image
share
My friend Joe Manausa from Tallahassee just wrote this great post on the National Association of Realtors spin on the recent housing numbers. We saw a similar situation here in Cobb County Ga. Prices through April did pretty well but I think… more
Grilling Recipes… Vote for Chef Rian!
share
Powder Springs Ga. 30127 Vote for Chef Rian! I have posted some things before about my friend and neighbor, Chef Rian MacDonald. If you are looking for something tasty and… more
Acworth, Ga. Home Values are up!
share
Acworth Ga. Home Values are up! While I don't think that Zillow is incredibly accurate, I do think it is a reasonable indicator of what is going on the market. Below is a 10 year chart of Zillow home values for Acworth, Ga. As you can see, if you… more
Venus, Moon,… and spaceships!
share
Venus, Moon,… and spaceships! With the space shuttle program scheduled to be discontinued there will only be a few more chances in our lifetime to see anything like this! .. more
Fins, under a full moon, under the bigtopJimmy Buffett. Atlanta 4-27-10
share
Fins, under a full moon, under the bigtop… Jimmy Buffet at Lakewood Amphitheater. Atlanta. April 27, 2010 Warning! This has absolutely nothing to do with real estate, realtors, or Cobb County Homes for sale. Well other than I wrote it :-) &… more
Won't you be my neighbor… and get a huge tax credit?
share
Country Walk, Powder Springs homes for sale. Won't you be my neighbor… and get a huge tax credit? Here are 2 great deal home listings. Both of these homes are priced at… more
May 1, Will it be a hangover or mild headache?
share
May 1, Will it be a full hangover or just a headache? Mike Licht, NotionsCapital. com Flickr Creative Commons The current tax credit ends on April 30. That is buyers… more
SUCCESSFUL REAL ESTATE AGENTS GET PAID FOR WHAT WE KNOW AND NOT WHAT…
share
Many years ago I heard a story: A large factory had to completely shut down because on its machines quit working. None the factory workers could get the machine running so they called in an expert. The expert walked up to the machine tapped… more
A1A Jimmy Buffett band at Strand Theater
share
A1A concert A1A band at the Marietta Strand We had a great group of friends get together last night for the A1A show at the Strand Theate r. What blast! First of all the Strand is amazing. For those… more
2490 Lakewood Dr, Kennesaw, Ga., short sale, fixer upper
share
Kenesaw Ga fixer upper. Short Sale 3/1. 5 all brick ranch plus a full basement and fenced yard. Conveniently located near 41 and Kennesaw Due West Road. Only minutes to Town Center Mall, I-75… more
Eastertime Celestial Show
share
Celestial showtime! There will be a fantastic planetary showing this weekend! Right after sunset just walk outside and look just above where the sun set down. You'll get a great view of… more
Is this guy really this stupid? NOT an April fools joke
share
Unfortunatley this guy is a congressman from here in Ga. and this is not an April fools joke. Watch clip and pay particular attention around 1:15 or so. He actually asked if the island of Guam might tip over from over over population! &… more
Lost Mountain Township, Powder Springs, Ga.
share
Lost Mountain Township Lost Mountain Township subdivision, Powder Springs Ga., Marietta West Cobb The entance at Lost Mountain Township Subdivision … more
5660 Rutland Dr. Powder Springs, Ga.
share
Welcome home to 5660 Rutland Drive, Powder Springs, Ga. 30127. See the virtual tour for this home See all Powder Springs, Ga. homes for sale … more
It's prom night.. I'm cleaning my gun!
share
It's prom night.. I'm cleaning my gun! Yes, my baby girl is going to the Lassiter High School prom tonight. Well, technically she's my step daughter, but me and her mom… more
Addie's Pond subdivision, Marietta, Ga
share
Addies Pond subdivision, Marietta, Ga, West Cobb Addies Pond subdivision in Marietta Ga is conveniently located at Villa Rica and West Sandtown roads … more
The Hermitage subdivision, Powder Springs, West Cobb, Georgia
share
The Hermitage subdivision, Powder Springs Ga., Marietta West Cobb The entance at The Hermitage Subdivision Powder Springs, West Cobb &… more
Marietta, Ga. free concerts on the square
share
Marietta, Ga. Summer concert series. This summers free concert series schedule has been announced. Come on out to the historic Marieta square and enjoy some great concerts and good times. Bring your lawn chairs, blankets, and pack a cooler of your… more
My first "Short Sale" 2003
share
2003 and it was my 1st "Short Sale" It was back in 2003 and I had been licensed for maybe a year. I was still on a team (although I use the word loosely). Short sales were not unheard of then but they were nowhere near as common as they… more
Humor-What Is Generation Y??
share
Humor-What Is Generation Y?? Well, I've always wondered about this myself.. & now I know. People born before 1946 were called The Silent generation The Baby Boomers are people born between 1946 and 1959. Generation X are… more