Signs the economy could be on the mend point to existing-home sales, according to the National Association of REALTORS®, which emphasizes the real estate market continues to improve everyday. In August, the NAR reported the national median price rose on a year-over-year basis for the past six months.
Total existing-home sales rose 7.8 percent to an adjusted annual rate of 4.82 million in August from 4.47 million in July, and are 9.3 percent higher than the 4.41 million-unit level in August 2011, reports the NAR.
In addition, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 3.60 percent in August from a record low 3.55 percent in July; the rate was 4.27 percent in August 2011, according to Freddie Mac.
The median existing-home price for houses across the country was $187,400 in August, up 9.5 percent from a year ago. The last time there were six back-to-back monthly price increases within a year was from December 2005 to May 2006. The August increase was the strongest since January 2006 when the median price rose 10.2 percent from a year earlier.
Distressed homes, which are categorized as foreclosures and short sales, sold at discounted rates, and accounted for 22 percent of August sales (12 percent were foreclosures and 10 percent were short sales), down from 24 percent in July and 31 percent in August 2011. Foreclosures sold for an average discount of 19 percent below market value in August, while short sales were discounted 13 percent, reports the NAR.
NAR Chief Economist Lawrence Yun said, according to the NAR website, that favorable buying conditions get the credit. "The housing market is steadily recovering with consistent increases in both home sales and median prices. More buyers are taking advantage of excellent housing affordability conditions," he said. "Inventories in many parts of the country are broadly balanced, favoring neither sellers nor buyers. However, the West and Florida markets are experiencing inventory shortages, which are placing pressure on prices."
Real estate experts say first-time buyers accounted for 31 percent of purchasers in August, down from 34 percent in July; they were 32 percent in August 2011.
Single-family home sales rose 8.0 percent to a seasonally adjusted annual rate of 4.30 million in August from 3.98 million in July, and are 10.0 percent above the 3.91 million-unit pace in August 2011. The median existing single-family home price was $188,700 in August, up 10.2 percent from a year ago.
Despite the positive outlook from the NAR on homeownership, many Garden State homeowners are currently still under water on their mortgages.
The Mortgage Bankers Association says New Jersey has the second-highest percentage in the nation of mortgage loans in foreclosure, at 7.7 percent.
Earlier this month, the Philadelphia Inquirer reported that struggling New Jersey homeowners facing foreclosure were supposed to have received aid under the Home Keeper program, which is run by the state of New Jersey and funded with $300 million from the federal bank bailout.
However more than a year after the program launched, state officials said only 10 percent of that money was spent, helping only 750 homeowners.
According to a report from a U.S. Special Inspector General, New Jersey has drawn the lowest percentage of federal money available to the 18 "hardest-hit" states. In a report issued last summer, it compiled data showing that of the 18 states awarded federal money hit hardest by the foreclosure crisis, New Jersey has used the least amount of funding.
The Department of Community Affairs acknowledges the issue and says there will be a series of changes about to be implemented to improve the distribution of funding.
New Jersey Assembly Democrats say they plan to hold hearings on the issue.
Source: http://www.newjerseynewsroom.com/economy/nj-real-estate-existing-home-sales-up-with-foreclosures
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