In Las Vegas, the weakest market in the country, prices continue to drop.

“I don’t know what those guys were drinking when they thought all this building made sense. If it does work out soon, then there’s some force out there in the universe that I’m not aware of,” Steve Cesinger, chief financial officer at Dewberry Capital, an Atlanta-based real estate investment firm.

Forbes magazine analyzed monthly declines as well as year-over-year declines in home prices. It also looked at how many months of equity homeowners have lost. With these figures in mind, it determined the 10 best and the 10 worst U.S. housing markets. Here they are::

10 Best
New York City
Washington, DC
Charlotte, N.C.
Portland, Ore
San Diego
Denver
Boston
Dallas
Los Angeles
Seattle

10 Worst
Las Vegas
Phoenix
Detroit
Minneapolis
San Francisco
Chicago
Cleveland
Atlanta
Tampa
Miami

What: The NATIONAL ASSOCIATION OF REALTORS®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.3 million members, including NAR’s institutes, societies and councils, involved in all aspects of the residential and commercial real estate industries.

Who: Our membership is composed of residential and commercial REALTORS®, who are brokers, salespeople, property managers, appraisers, counselors and others engaged in all aspects of the real estate industry. Members belong to one or more of some 1,600 local associations/boards and 54 state and territory associations of REALTORS®. They are pledged to a strict Code of Ethics and Standards of Practice.

Why: Working for America’s property owners, the National Association provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.

The Term REALTOR®

The term REALTOR® is a registered collective membership mark that identifies a real estate professional who is a member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics.

* Just because a person is licensed to sell real estate does not automatically mean they are a Realtor. If they have not passed through the additional training and code of ethics courses, they may just be a sales associate. Don’t trust the biggest financial decision to anyone other than a full time Realtor.

Now that the American Recovery and Reinvestment Act has been sent to President Obama for his signature, the National Association of Realtors®  is looking forward to swift implementation. 

“We are pleased that Congress and the administration have taken prompt action to address the current economic crisis,” said NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage Dallas-Fort Worth. “Job creation and tax cuts are going to help families recover and prosper, and these initiatives will help more people keep their homes and help others become homeowners.” 


An economic recovery is not possible without a housing recovery, and the legislation contains two important housing provisions championed by NAR. The final stimulus bill increases the first-time home buyer tax credit to $8,000 and eliminates the repayment requirement of earlier legislation.  In addition, the credit availability has been extended until December 1. 


“These important provisions will help bring first-time home buyers to the market and reduce housing inventory,” said McMillan. NAR estimates that the home buyer tax provisions could stimulate up to 300,000 additional home sales, helping stabilize home values and potentially preventing some homeowners from being “underwater” on their mortgage, which can often lead to foreclosure.


The bill also reinstates the 2008 higher loan limits for FHA, Fannie Mae and Freddie Mac. “These higher loan limits are important to make mortgages affordable regardless of where you live. This will also help reduce inventory and improve liquidity in the overall mortgage market,” McMillan said. 


NAR commended President Obama and Congress for including resource allocation for neighborhood stabilization efforts to help communities purchase and rehabilitate foreclosed and vacant properties. This funding will protect communities across the country and preserve home values from further decline. Realtors® also praised the provision to help America’s wounded warriors who need to move or relocate. 


NAR’s housing policy agenda also includes better foreclosure mitigation efforts and lower interest rates for homeowners and buyers. These components in support of a housing recovery are expected to be addressed in the coming days. 

NAR pledged to continue to work with President Obama, Congress and the regulators to make housing stabilization a key component of any federal recovery plans.


“NAR will continue representing Americans who are trying to purchase a home, protect their current home or preserve investment opportunities in residential and commercial properties. We believe that positive steps are being taken to improve the housing market, and it is important that we keep moving forward with our efforts,” McMillan said. 


The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

The plan does not provide help to investors or to homeowners who are in trouble with a second home, nor does it apply to homeowners whose mortgage is part of a private-label mortgage security that is not backed by Fannie Mae or Freddie Mac.

Source: REALTOR® Magazine Online

In the fourth quarter, 134 out of 153 metropolitan statistical areas showed declines in median existing single-family home prices from the same period in 2007, pulled down by active sales at the lower end that were driven by foreclosures. One area was unchanged and 18 metros reported price gains. NAR’s track of metro area home prices dates back to 1979.

Distressed sales – foreclosures and short sales – accounted for 45 percent of transactions in the fourth quarter, dragging down the national median existing single-family price to $180,100, which is 12.4 percent below the fourth quarter of 2007 when conditions were more balanced; the median is where half sold for more and half sold for less.

NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said homes and neighborhoods minimally impacted by foreclosures have moderate prices changes. “Distressed home sales have risen from about 38 percent of transactions in the third quarter, meaning people are responding to discounted prices and are slowly absorbing the excess inventory. Buyers clearly see value in today’s pricing,” he said.
“It has never been more important than now to work with local professionals to properly gauge local neighborhood conditions because foreclosures are heavily skewing the broader home price figures to be much lower. Big discounts are not occurring in neighborhoods with few foreclosures. A REALTOR® who is knowledgeable about local conditions can counsel consumers in making sound long-term housing decisions,” McMillan said.

Total state existing-home sales, including single-family and condo, were at a seasonally adjusted annual rate² of 4.70 million units in the fourth quarter, down 6.4 percent from 5.02 million units in the third quarter, and are 5.9 percent below the 5.00 million-unit pace in the fourth quarter of 2007.

Lawrence Yun, NAR chief economist, said the market is clearly depressed from job losses and consumer concerns about the economy. “Assuming housing provisions in the economic stimulus package are quickly enacted and provide enough encouragement for home buyers, we could see a quick lift in home sales for the critical spring home-buying season,” he said.

“If that occurs, we could see home prices begin to stabilize in many metro areas later this year as supply and demand begin to return to balance, which would greatly benefit the overall economy,” Yun said.

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage fell to 5.86 percent in the fourth quarter from 6.32 percent in the third quarter; the rate was 6.23 percent in the fourth quarter of 2007.

The largest sales gain in the fourth quarter from a year earlier was in Nevada, up 133.7 percent, followed by California which rose 84.7 percent, Arizona, up 42.6 percent, and Florida with a 12.5 percent increase.

Nariman Behravesh, chief economist with the research firm Global Insight, says people will benefit in several ways:

“Interest rates will come down, credit conditions will ease. The operative term here is ‘those who qualify.’ Whether it’s for mortgages or car loans or whatever, if your credit score is good, then I think it will be easier” to get credit.

How long will it be before people with lower credit scores are able to get mortgages?

“Better economic times. That is the reality,” Behravesh says. “The pendulum has swung in terms of caution. You might get some people with a middling credit score to do OK. But for people who don’t have good scores, it will continue to be tough to borrow, at least for another year.”

Source: The Associated Press, Mark Jewell (02/10/2009)

                                                                                       

Study Predicts Riskiest Markets for Price Drops
Home prices are likely to fall still more, according to a new study by mortgage insurer PMI Group Inc.

The study predicts that home prices will be lower than they are now in 97 percent of 381 metro areas by the third quarter of 2010.

The riskiest markets for falling home prices are California’s Inland Empire; the greater Miami, Fla., area; Lake Havasu City-Kingman, Ariz.; and the Cape Coral-Fort Myers, Fla., areas.

The cities with the lowest risk of further declines include the Dallas-Fort Worth area, greater Houston and Pittsburgh.

Home prices showed signs of recovery in the third quarter of 2008, but with rising unemployment rates, home prices fell further in the fourth quarter, says PMI chief economist David Berson.

Source: The Wall Street Journal, Ruth Simon (01/13/09)