Gradual and uneven progress in the housing market continues without
government support. The market has shown remarkable improvement from the
initial drop after the expiration of the home buyer tax credit this past
July. Although higher-than-normal distressed sales skew the overall
picture of home prices downward, inventory remains at pretax credit
expiration levels. The rock-bottom interest rates of 2010 are likely to
trend upward. As economists anticipate rates at or above 6% by the end
of 2012, buyers are moving off the sidelines and into the market.
Although home sales have fallen 9.6% compared to the previous month, they remain close to last year’s levels, showing only a 2.8% decline. The unseasonably cold weather across much of the country during late January and February could have kept buyers indoors more so than normal. Gradual improvement with bumps along the way has long been the anticipated road to full recovery. In fact, home sales remain 26.4% above the low last July. As Lawrence Yun, chief economist of the National Association of Realtors, explains “month-to-month movements can be instructive, but in this uneven recovery, it’s important to look at the long-term performance.”
Inventory- Month's Supply
Source: National Association of Realtors - housing data released Mar 21.
Throughout the month, rates hovered in the 4.8%‒4.9% range. After rising above 5% for the first time in about ten months in early February, rates have come back below but are expected to follow an upward trend throughout the year. As overall economic recovery remains on track, rates will likely rise to keep inflation in check. Buyers wanting to capture the savings in monthly payments that a historically low interest rate affords are expected to take advantage of excellent buying conditions.
When first-time home buyers decide they
are ready to buy, it is essential for them to begin the process by
carefully assessing their values, wants, and needs—both for the short
and for the long term. This is a critical step since consultation
sessions normally start with the buyers’ values. Afterward, buyers can
explore their wants and needs, and once defined, determine actual
A recent study shows how important the following home-buying factors were to buyers:
A summary of Kauai real estate sales is shown in the charts below. 2011 sales prices and number of sales are mixed compared to last year.
Additional Kauai sales information is available upon request.
Brought to you by KW Research. For additional graphs and details, please see the This Month in Real Estate PowerPoint Report.
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