ST. JOSEPH, MI – “June started our peak selling period with a 10 percent increase in houses sold and closed over May. However like May, June closed sales did not carry the surge that we had experienced from February until April that was a result of the Stimulus Tax Credit.  June closed sales were 10 percent lower than in June of 2009.  Since buyers had until June 30^th to close sales, this may indicate that pending sales did not get closed or that buyers did not take advantage of the tax credit. Congress has passed an extension of the Homebuyer Tax Credit closing deadline to September 30, 2010 so we will have to see if the extension will have any effect,” stated Gary Walter, EVP, of the Southwestern Michigan Association of REALTORS^®, Inc.

The number of houses sold and closed dropped 10 percent (225 vs. 251) in June this year compared to June 2009.  Year-to-date, the number of houses sold was up 8 percent.  The total dollar volume for June slipped 11 percent below the June 2009 figure ($37,165,723 vs. $41,956,121).  Year-to-date dollar volume was up 12 percent.  The average selling price dipped 1 percent below last year at $165, 181 vs. $167,156. The higher sales in February through April this year kept the year-to-date average selling price up 5 percent ($141,757 vs. $136,402).  The median selling price increased 5 percent in the June ($115,000 vs. 109,950).  The year-to-date median price was up 14 percent over that in 2009.  The median price is the price at which 50% of the homes sold were above that price and 50% were below.

Nationally, existing-home sales slowed in June but remained above year-ago levels, according to the National Association of Realtors®.

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, fell 5.1 percent to a seasonally adjusted annual rate of 5.37 million units in June from 5.66 million in May, but are 9.8 percent higher than the 4.89 million-unit pace in June 2009.

Lawrence Yun, NAR chief economist, said the market shows uncharacteristic yet understandable swings as buyers responded to the tax credits. “June home sales still reflect a tax credit impact with some sales not closed due to delays, which will show up in the next two months,” he said.

“Broadly speaking, sales closed after the home buyer tax credit will be significantly lower compared to the credit-induced spring surge. Only when jobs are created at a sufficient pace will home sales return to sustainable healthy levels.”

The national median existing-home price for all housing types was $183,700 in June, which is 1.0 percent higher than a year ago. Distressed homes were at 32 percent of sales last month, compared with 31 percent in May; it was also 31 percent in June 2009.

Regionally, existing-home sales in the Midwest dropped 7.5 percent in June to a pace of 1.23 million but are 11.8 percent higher than a year ago. The median price in the Midwest was $155,900, down 0.1 percent from June 2009.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said softer home sales expected this summer don’t tell the whole story. “Despite these market swings, total annual home sales are rising above 2009 and we’re looking for overall gains again this year as well as in 2011,” she said. “Conditions have become more balanced in much of the country, which is good for both buyers and sellers. However, consumers find it even more challenging to navigate the transaction process, especially for distressed properties, which only underscores the value Realtors® bring to buyers and sellers in this market.”

A parallel NAR practitioner survey shows first-time buyers purchased 43 percent of homes in June, down from 46 percent in May. Investors accounted for 13 percent of sales in June, little changed from 14 percent in May; the remaining purchases were by repeat buyers. All-cash sales were at 24 percent in June compared with 25 percent in May.

In SWMI, the bank-owned or foreclosed homes spiked to 50 percent in February but have declined to 28 percent in June.  Last year in June, foreclosed transactions were at 36 percent.  The lowest point last year was 34 percent.

Walter reported, “We had as of the first of July 3,679 houses listed for sale, which is a 2 percent increase over that in June.  This inventory level gives us a 16.9-month supply of homes for sale, which is down from last year when we had a 19.7-month supply.  The surge of sales during February through April helped to lower the inventory.

Nationally, the total housing inventory at the end of June rose 2.5 percent to 3.99 million existing homes available for sale, which represents an 8.9-month supply at the current sales pace, up from an 8.3-month supply in May.

“The supply of homes on the market is higher than we’d like to see. But home prices are still holding their ground because prices had already overcorrected in many local markets,” Yun said. Raw unsold inventory remains 12.7 percent below the record of 4.58 million in July 2008.

Interest rates in SWMI decreased from 5.00 percent in May to 4.79  percent in June. According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 4.74 percent in June from 4.89 percent in May; the rate was 5.42 percent in June 2009.

The numbers reported for local sales include residential property in Berrien, and the western half of Van Buren and Cass counties.  All three counties are included in numbers and percentages and do not reflect differences in any individual areas.

The Southwestern Michigan Association of REALTORS^®, Inc. is a professional trade association for real estate licensees and ancillary service providers for the real estate industry in Van Buren, Berrien and Cass counties.  The Association is located at 3123 Lake Shore Drive St. Joseph, MI 49085, (269) 983.6375.  They can also be contacted through their web site, www.swmar.com.

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

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7/22/2010