Sales Fall, Prices Rise

Existing-home sales were sharply lower in July following expiration of the home buyer tax credit but home prices continued to gain, NAR says. Existing-home sales dropped 27.2 percent to a seasonally adjusted annual rate of 3.83 million units in July from a downwardly revised 5.26 million in June, and are 25.5 percent below the 5.14 million-unit level in July 2009. Sales are at the lowest level since the total existing-home sales series launched in 1999, and single family sales--accounting for the bulk of transactions--are at the lowest level since May of 1995. "Given rock-bottom interest rates and historically high housing affordability conditions, the pace of a sales recovery could pick up quickly if the economy consistently adds jobs," says NAR Chief Economist Lawrence Yun. Even with sales pausing for a few months, annual sales are expected to reach 5 million in 2010 because of healthy activity in the first half of the year. 

Home Sales Down in January but Higher than a Year Ago; Prices Steady

Nationally, existing-home sales fell in January but are above year-ago levels, according to the National Association of REALTORS®.
Existing-home sales, including single-family, townhomes, condominiums and co-ops dropped 7.2 percent to a seasonally adjusted annual rate1 of 5.05 million units in January from a revised 5.44 million in December, but remain 11.5 percent above the 4.53 million-unit level in January 2009.
In the greater Albuquerque metro area the housing market followed in line with the National trend but January was the fifth consecutive month where closed sales have increased over the same month in the previous year. It’s a trend that started in September 2009...
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U.S. Ripple Effect

As the U.S. begins moving out from under the housing crunch, other world markets are just beginning to feel the "overseas aftershock" of the global financial system, according to the Sept. 4 Business Week online magazine. What do bad home loans in Alpharetta, Ga. have to do with office buildings in London or Tokyo? "Plenty," says Business Week. Global lenders, wary of further credit problems are denying credit to many builders and/or instituting tougher terms on commercial property loans. This, in turn, impacts employment markets, which impact rents and causes developers to rethink plans. The whole global commercial property market has slowed with the value of commercial real estate transactions worldwide at only $306 billion for the first six months of 2008--about half the amount for the same period in 2007, according to Real Capital Analytics. But it's not just the U.S. subprime mortgage situation at play. An overall softer economy and weak consumer confidence has hurt smaller developers--particularly those is markets that heated up quickly, including those servicing U.S. outsourcing (think IT); a U.S. sector that is slowing along the overall economy. In spite of all this, Business Week notes that opportunities exist, especially for those with cash. Sovereign wealth funds (SWF), which are state-owned entities that manage savings for investment purposes, are key players in commercial real estate and are flush with cash. According to an article in the April Real Estate Forum, SWF have grown from about $500 billion to more than $3 trillion since the 1990s, with projections of tripling that amount by 2012. Go to pg. 10 to read the full article.
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