Housing reports send mixed market data on real estate recovery
October 22, 2009 by admin
The real estate market roller coaster has hit a flat line according to recent reports released in October. The housing market enjoyed several months of stellar gains in sales and pricing during the summer months, but has struggled to hold the momentum through the fall and into a pivotal fourth quarter for the markets. This past week, the housing market revealed two key reports which are heavily followed by analysts and investors as they gauge the markets recovery. Earlier in the week, the housing starts data was revealed which indicated that the overall market took a bit of a breather in September for building. Residential permits for the month were flat, while multi family permits edged down for the first time in the last four months. This data was taken in stride by the markets, contributing mildly too a downturn in the equity markets, but not raising too many dramatic concerns.
Today, according to a report released from the Federal Housing Finance Agency, prices edged lower in home sales data for the first time in the last three months. The information on home prices is gathered from relationships with Fannie Mae and Freddie Mac, the nation’s two largest agency loan companies as well as other key reports. This report is also likely to have minimal impact on the equity markets, but could be used as leverage by trade associations (National Association of Realtors, Mortgage Bankers Association) that are pushing for the government to extend the governments first time home buyer tax credits. The current tax credits are due to expire at the end of November are going to become larger political news items over the next few weeks as the deadline approaches. Trade groups believe that the existing tax credit has helped bring 300,000 new home buyers into the market this year, influencing fist time home buyers who may not have qualified previously or had a sense of urgency to buy their first homes. First time home buyers are a critical influence on the housing eco system as their purchase on the low to medium price points of the market help push price stability and appreciation up the channel.
The key reports that most experts put emphasis within the housing industry have yet to be released this month. The new home sale and existing home sale data are often the two most influential housing reports. They help to benchmark home sales on monthly basis and also represent projections on total housing sales for the year. The real estate market has enjoyed a slight rebound in 2009, helping to place a bottom for prices and sales in many markets throughout the country. The influence of the tax rebate and governments involvement with subsidizing the mortgage backed security market has been key factors in this rebound. The stabilization of the housing markets will continue to be closely monitored by government agencies, economists, investors and home owners.