Which way is the market headed?

As a Licensed Real Estate Agent I speak to buyers and sellers every day. I hear the stories where people cannot afford their mortgages to the people who have taken their home off the market because they do not absolutely have to sell their home. Home prices dropped 2.6% nationwide during the last three months of 2010, pushing more borrowers underwater, according to a quarterly real estate market survey from Zillow.com. According to NAR the Total state existing-home sales, including single-family and condo, jumped 15.4 percent to a seasonally adjusted annual rateof 4.8 million in the fourth quarter from 4.16 million in the third quarter.

As the months have gone by it seems that the sellers who do not have to sell are not testing the waters as quickly and agents are not so quick to take those listings. The numbers speak to truth. As per MLS in Nassau County New York January 2011 we had 579 homes sold while 479

homes went under contract. As of February 9, 2011 219 homes closed and 198 homes went under contract. Last February 2010 we had 729 homes sales which was up from 569 sales from 2009. As of Last month the average closed price dropped another .99%.

The number of homes sold in Dec 2010 was 756 down from December 2009 which there was 906 closed sales. The numbers show a significant drop in number of homes sold and prices. On a good note we have a 13 month supply of inventory which is down from 3 months ago where there was a 15.4 month supply of homes on the market. Reuters NewsStated Mortgage applications gained 11.3 percent in the week ended Jan. 28, according to MBAs seasonally adjusted index. In the week prior, applications had fallen nearly 13 percent.

CNN Money reported the rates are back up to over 5 percent The national average interest for a 30-year, fixed-rate mortgage surpassed 5% for the first time since May 2010, according to Freddie Mac's Primary Mortgage Market Survey. During the week ending Feb. 11, rates averaged 5.05%. That factors in an average of 0.8 points in fees that the average borrower paid to lower his or her rate. Sometime, somehow, the foreclosure crisis will ease. But probably not anytime soon.

Many sellers have taken their home off the market and put off their retirement dreams for the next few years hoping the market will rebound, they may be correct depending on what price range they are in. The highest selling price range is between 350k and 700k but is still lower than last year at this time. Home and co-ops under 200k have seen a 32.5% decline in volume which shows the massive inventory of co-ops on the market

Source: “Brian Jeacoma” Brian Jeacoma, Inc. (Feb. 9, 2011)

All information deemed reliable but should be independently verified