It is almost Memorial Day weekend where the Lake Chelan Valley sees its population skyrocket until Labor Day. This is the busiest time of the year for area businesses, including real estate.
Inventories are down, as well as listings. Even though interest is up from buyers, only 267 homes have been listed this year as compared to 292 in 2012.
Buyers haven’t been excited in purchasing a home the last few years when they were concerned that the price might continue to drop. That concern has been replaced in many cases with worry that they might miss the low prices that have been available due to rising home prices. The news media is spurring on the recent buyer confidence.
The Wall Street Journal reports rising prices and sales point to a market rebound:
Existing-home sales were up 3.4% from March to a seasonally adjusted annual rate of 4.62 million, the National Association of Realtors trade group said Tuesday. If the pace holds, 2012 could be the strongest year for home sales since 2007, just after the housing boom. The median home price, meanwhile, increased 10.1% from a year earlier to $177,400, the strongest year-to-year gain since January 2006. – WSJ
According to the Census Bureau, new home sales are up as well.
sales of new single-family houses in April 2012 were at a seasonally adjusted annual rate of 343,000, up 3.3 percent for the month and 9.9 percent for the year, further signaling improvements in one of the hardest hit housing sectors. Improvement in any portion of the housing market is welcome news as various indicators show signs of health after years of being battered.
The median sales price of new homes sold in April hit $235,700, marking a 4.9 increase over the past year, with an average sales price of $282,600 in April nationally. The month ended with 146,000 new homes for sale, representing a 5.1 month supply at the current sales rate, outperforming resale homes with a 6.6 month supply. – Agbeat.com
Commercial real estate is improving as well. While multifamily rental properties have done well for awhile, with many former homeowners entering the rental market, other sectors are improving as well according to Lawrence Yun, the chief economist for the National Association of Realtors:
The pattern shows gradually declining commercial vacancy rates, with consequential but generally modest rent growth. Although we need even stronger job growth, by far the greatest impact of job creation is in multifamily housing, where newly formed households striking out on their own have increased demand for apartment rentals – this is the sector with the lowest vacancy rates and strongest rent growth, which is attracting many investors.
Interest rates have recently hit new record lows although qualifying for a mortgage requires better credit and stronger financials in the past.
May 2012 Commercial Real Estate Quarterly Market Survey
But, there are still concerns. A recent report from Zillow shows that far more homeowners are underwater, with their home being worth less than their mortgage, than previously thought. Zillow claims 16 million, or 31.4% of all, homeowners with a mortgage are likely underwater. They owe $1.2 trillion more than the value of their homes!
It should be a busy summer!