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Traverse City area Home Sales Rise

Local, national home sales rise

Tax credit continues to help boost sales across the nation

By Bill O'Brien
bobrien@record-eagle.com

TRAVERSE CITY -- Home sales in the Traverse City area surged again in October, following a national trend in which sales reached their highest level in 21/2 years.

Local home sales in the 5-county Traverse City area in October were up 5 percent from September sales numbers, according to data from the Traverse Area Association of Realtors. Home sales in Grand Traverse, Leelanau, Benzie, Antrim and Kalkaska counties totaled 207 units in October, up more than 8 percent from October 2008.

Total dollar volume for October sales exceeded $35.1 million, including almost $19.5 million in Grand Traverse County.

October figures brought year-to-date home sales to 1,607 for the first 10 months of 2009, the highest total since 2006. Year-to-date sales for 2009 are running almost 2.9 percent of last year, and 4.9 percent ahead of 2007's pace.

Local and national real estate markets continue to see a boost from an $8,000 tax credit for first-time home buyers that was supposed to expire Nov. 30. But Congress recently extended and expanded the credit to include people who have owned their current homes for at least five years. They can now claim a tax credit of up to $6,500 for a home purchase.

"Obviously, we're pleased we've gotten an extension on the tax credit," said Kim Pontius, executive vice president of TAAR. The credit is spurring local sales, he said, and local agents are hopeful it will generate more activity going into 2010 from local homeowners looking to move into more upscale housing.

"We think that's really going to help in what's traditionally a slow period for us," Pontius said.

Home sales nationwide are now up nearly 36 percent from their bottom in January, data Monday showed, though they are still 16 percent below the peak in autumn 2005. At the current sales pace, there is only a 7-month supply of homes on the market and in some areas there are bidding wars.

The National Association of Realtors said home resales rose 10.1 percent to a seasonally adjusted annual rate of 6.1 million in October, from a downwardly revised pace of 5.54 million in September. It was the biggest monthly increase in a decade, and far above the 5.65 million pace expected by economists, according to Thomson Reuters.

The NAR said there were 111,000 resales in the Midwest, up 26 percent from October last year and the best showing in the country. The median sale price for the region rose 1 percent -- also leading the country -- to $146,600.

The median sale price in the 5-county area for October dipped less than one percent from September to $135,000, as prices continue to be held down by foreclosures and short sales.

The housing recovery is being driven by lower prices combined with federal programs to lower mortgage rates and bring more buyers into the market. The median sales price nationally was $173,100, down 7 percent from a year earlier and off roughly 2 percent from September.

Nationally, home sales are likely to drop over the winter as buyers hibernate for a few months without the looming tax credit deadline.

The new deadline means "we're going to see some good activity coming out of the spring," said Pat Lashinsky, chief executive of online real estate brokerage ZipRealty Inc.

The Associated Press contributed to this report.

Posted: Tuesday, November 24, 2009 3:27 PM by Jon Becker

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