Those shopping for real estate in Philadelphia and elsewhere have been taking advantage of today?s favorable real estate market conditions, according to the National Association of Realtors.
The latest Pending Home Sales Index from the NAR, a forward-looking indicator, shows contract signings nationwide in January 2012 up 2 percent from the previous month and 8 percent from the same month a year ago. The index stands at 97.0, its highest level since April 2010, when the Federal tax credit for new home buyers pushed the index to 111.3. (An index of 100 equals the average level of contract signing activity in 2001, the year the NAR began this survey and the first of five straight years of record sales of existing homes. The NAR says the 2001 level is consistent with historically normal sales activity.)
It is quite likely that falling home prices have contributed a great deal to the uptick in sales of real estate in Philadelphia and nationwide. The latest S&P/Case-Shiller Home Price Indices, released today for December 2011, show home prices nationwide and on both the 10- and 20-city composite indices down significantly for the year. The national index fell 3.8 percent in the fourth quarter; it is also down 4 percent for the year, as is the 20-city composite index, which fell 1.1 percent in December. The 10-city composite index, which also fell 1.1 percent in December, is down 3.9 percent for the year. The declines bring the house price indices to their lowest levels since the housing market implosion began in mid-2006.
NAR Chief Economist Lawrence Yun said the January pending sales index figure bodes well for the coming spring home-buying season.??Given more favorable housing market conditions, the trend in contract activity implies we are on track for a more meaningful sales gain this year,? he said.? ?With a sustained downtrend in unsold inventory, this would bring about a broad price stabilization or even modest national price growth, of course with local variations.?
Pending sales in the Northeast continue to lag somewhat, with the January index at 78.2, but the upward trend in sales of existing homes is evident here as well, as the index is up 7.6 percent from the previous month and 9.2 percent from one year ago.
What does all this mean for the potential buyer of Philadelphia real estate? In short, it means that opportunity is knocking hard at the door. While the Philadelphia real estate market has not fallen as far as those in other cities, it stands at a level comparable to many of them; the fourth quarter local market figures released last month by Econsult show house prices in the city at the same level as those on the S&P/Case-Shiller 10-city composite index. (Philadelphia is not one of the 20 cities tracked by S&P/Case-Shiller.) This means that buyers who obtain financing at today?s super-low rates could find values on homes like they haven?t seen in a decade and save a pretty penny on the home of their dreams.
?By Sandy Smith for PhiladelphiaRealEstate.com
Source: http://blog.philadelphiarealestate.com/pending-home-sales-rise-as-prices-remain-low/
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