Region’s Housing Market Turned the Corner in Third Quarter
According to economists surveyed by the National Association for Business Economics, the recession, which began in December 2007, has ended. Further, they noted the housing recovery “will gather momentum” and 2010 will be the first year since 2005 that the housing sector will contribute to overall growth. After flattening out this year, house prices, they said, will see a “modest gain of 2% in 2010.”
Third quarter marked the turnaround point for housing sales in our markets. At Ruhl&Ruhl, for example, we sold and closed on 8.4% more properties during the third quarter of 2009 than during the third quarter of 2008, comparing 1187 sales this year to 1095 sales last year. Pending sales written in September of 2009 and not yet closed were up 23% over September of last year and sales written during the first three weeks of October were up 55%. So fourth quarter sales closed will be well ahead of fourth quarter 2008 as well.
The 2009 Regional Real Estate Results chart on page 2 shows that year to date the number of properties sold is still down from last year, ranging from 3% down in the Iowa City area to 17% down in the Maquoketa/Preston/Bellevue markets. This reflects the devastating first quarter results. In most markets, year to date sales volume is also down more than the number of properties sold. This is because more lower-priced homes have been selling due to the first-time homebuyer tax credit. This change in the mix of deals to more lower-priced sales and fewer higher-priced sales has also resulted in lower average sales prices in most of our markets. The good news is – now that first-time buyers have purchased entry level homes, sellers of those homes can buy new, more expensive homes, and we will see increasing average sales prices.
Home prices in our region continue to be stable, as show in the Federal Housing Finance Agency chart on page attached. Ranked by price appreciation, all of our regional markets are in the top 25% of 294 Metropolitan Statistical Areas nationally.
This continues to be a great time to buy a home in our markets. Interest rates are still near record lows – in the range of 5.000%-5.250% for 30-year conventional and FHA mortgages and 4.375%-4.625% for 15-year mortgages. All sellers are advised to get pre-approved for a mortgage before listing their homes for sale if they are planning to purchase a new home. Because of the tightened credit requirements, some sellers have sold their homes only to find they no longer qualify for a mortgage to purchase a new home. While mortgages monies are still readily available in our region to buyers with good credit, nationally nearly one-third of all borrowers who applied for a loan last year were turned down, according to the Federal Reserve. Call 1862 Mortgage to get preapproved at 563-441-1862.
Today, Ruhl&Ruhl REALTORS, the residential company, has 250 sales associates, 60 employees and ten residential offices serving eastern Iowa and western Illinois, along with its corporate office in Davenport, Iowa. The company annually sells approximately 3,400 homes in the areas it serves, including offices in Davenport, Bettendorf, Clinton, Dubuque, Bellevue, Muscatine, Coralville, DeWitt, and Maquoketa, Iowa and in Moline, Illinois. In addition to residential sales, Ruhl&Ruhl offers services in relocation, new home sales, farm sales, senior services, property management, and mortgage services through 1862 Mortgage. For more information on Ruhl&Ruhl, visit their website at www.RuhlHomes.com.