Pending Home Sales Continue Recovery, Gradual Improvement Seen in 2011

Washington, DC, December 30, 2010

Pending home sales rose again in November, with the broad trend over the past five months indicating a gradual recovery into 2011, according to the National Association of Realtors®.


The Pending Home Sales Index,* a forward-looking indicator, rose 3.5 percent to 92.2 based on contracts signed in November from a downwardly revised 89.1 in October. The index is 5.0 percent below a reading of 97.0 in November 2009. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.


Lawrence Yun, NAR chief economist, said historically high housing affordability is boosting sales activity. “In addition to exceptional affordability conditions, steady improvements in the economy are helping bring buyers into the market,” he said. “But further gains are needed to reach normal levels of sales activity.”


The PHSI in the Northeast increased 1.8 percent to 72.6 in November but is 6.2 percent below November 2009. In the Midwest the index declined 4.2 percent in November to 78.3 and is 7.7 percent below a year ago. Pending home sales in the South slipped 1.8 percent to an index of 91.4 and are 7.2 percent below November 2009. In the West the index jumped 18.2 percent to 123.3 and is 0.4 percent above a year ago.


**“If we add 2 million jobs as expected in 2011, and mortgage rates rise only moderately, we should see existing-home sales rise to a higher, sustainable volume,” Yun said. “Credit remains tight, but if lenders return to more normal, safe underwriting standards for creditworthy buyers, there would be a bigger boost to the housing market and spillover benefits for the broader economy.”


The 30-year fixed-rate mortgage is forecast to rise gradually to 5.3 percent around the end of 2011; at the same time, unemployment should drop to 9.2 percent.


For perspective, Yun said that the U.S. has added 27 million people over the past 10 years. “However, the number of jobs is roughly the same as it was in 2000 when existing-home sales totaled 5.2 million, which appears to be a sustainable figure given the current level of employment,” he explained.


“All the indicator trends are pointing to a gradual housing recovery,” Yun said. “Home price prospects will vary depending largely upon local job market conditions. The national median home price, however, is expected to remain stable even with a continuing flow of distressed properties coming onto the market, as long as there is a steady demand of financially healthy home buyers.”


Existing-home sales are projected to rise about 8 percent to 5.2 million in 2011 from 4.8 million in 2010, with an additional gain of 4 percent in 2012. The median existing-home price could rise 0.6 percent to $173,700 in 2011 from $172,700 in 2010, which was essentially unchanged from 2009.


“As we gradually work off the excess housing inventory, supply levels will eventually come more in-line with historic averages, and could allow home prices to rise modestly in the range of 2 to 3 percent in 2012,” Yun said.


New-home sales are estimated to rise 24 percent to 392,000 in 2011, but would remain well below historic averages, while housing starts are forecast to rise 21 percent to 716,000.


Yun sees Gross Domestic Product growing 2.5 percent in 2011, and the Consumer Price Index rising 2.3 percent.


The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.


NAR full article

Home Maintenance

December Home Maintenance Checklist

- Check attic Insulation
- If you have oil heat, dust and lubricate to save fuel and repair costs
- Eliminate rodents which can cause a lot of damage
- Reevaluate your Emergency home kit
- After a big snow fall

• Clear walkways with a snow shovel and sprinkle sand or salt on them for traction. (Be careful with the salt, though — it can leach into flower beds and is hard on pets' feet.)
• Check your roof for ice dams and break them up to release water if necessary. Frozen dams along the eaves cause melted snow to puddle above and possibly leak through the roof.
• Knock snow from tree branches to keep them from breaking under the weight.
• Consider sweeping snow from roofs that have shallow angles or little support (sheds, carports, lean-tos) if it can be done safely.

Visit http://realestate.msn.com/article.aspx?cp-documentid=13107892 for more information!

First Time Homebuyers

Looking to reduce your carbon footprint this Holiday Season? Here are a few tips from Lowes.com

Use Sustainable Gift Wrap: Consider saving and reusing holiday wrapping paper just as your grandmother once did. Or wrap your gifts in pretty fabric that can be used for other purposes. "In my family, we re-gift gift bags again and again," DeLongpre Johnston says. "Pillowcases can also make pretty gift wraps if done right." 

Decorate with Energy-Efficient Lighting: While many people still use standard incandescent holiday bulbs, decorative LED lights are now available in a variety of holiday shapes and colors. In addition to having a much longer life span than standard lights, LEDs also reduce fire risks because they stay cool to the touch. "This would be one of the areas where you might spend a little more upfront, but save in the long run," DeLongpre Johnston says. Want to be even greener? Use light-sensor timers to turn your lights on and off. 

Give Consumable Gifts: Most Americans don't need any more stuff or, as DeLongpre Johnston points out, we're all "stuffed out." So consider giving the gift of services instead, or goods that can be consumed. Some ideas include massages, pedicures, tickets to sporting events, gift certificates for restaurants and other similar pampering treats. Other options would be to give consumable gifts that keep on giving all year long like a membership to a Wine of the Month Club or a monthly delivery of seasonal fruits grown locally. Says DeLongpre Johnston: "It doesn't mean you have to be any less generous." 

Make a Donation in Someone's Name: If someone has a passion in life, giving to an organization that supports their cause can be very meaningful. Whether you donate a flock of chicks to support a hungry family through Heifer International or fund the planting of trees through American Forest, you will be giving a gift that gives back and helps preserve the environment at the same time. 

Give the Gift of Time: Schedule time to get together with friends and family for cookie exchanges or other meaningful holiday events. "We do have the ability as individuals and families to bring whatever intention to this season that we want," DeLongpre Johnston says. "So we can share meals and share time with one another, and if we'd like to give each other gifts, we can do that too." 

Treecycle: If you have a cut tree, check with your local municipality to find out when they will pick it up for recycling. Fortunately, you'll be in good company. More than 30 million real Christmas trees are sold in the United States each year, but more than 90 percent are being recycled for mulch or chipped and used in parks and other public spaces.


For more information:   Green Christmas