Existing-home sales continued to recover in the first quarter, with gains in every state but Vermont, according to the latest survey by the National Association of Realtors.
Existing-home sales, including single-family homes and condos, rose 8.3 percent to a seasonally adjusted annual rate of 5.1 million in the first quarter and are only 0.8percent below the same period in 2010. In New York, existing-home sales rose 9.5 percent, better than the national average.
Distressed Sales Put Pressure on Prices
The national median home price was $158,700 in the first quarter, down 4.6 percent from last year. The median is the mid-point — where half sold for more and half sold for less. In Nassau and Suffolk the median price declined a mere 1.3 percent — much lower than the national average. Distressed homes typically sold at a discount of about 20 percent and accounted for 39 percent of first quarter sales.
NAR President Ron Phipps said strong sales of distressed homes are exactly what the market needs. “The good news is foreclosures, which account for two-thirds of all distressed homes sold, are selling very quickly,” he said. “Short sales still take far too long to get lender approval, but it appears the inventory of distressed property is peaking and will be gradually declining next year. This means the market should slowly return to balance. “
Repeat buyers had the largest increase, 47 percent of the market in the first quarter versus 40 percent last year. Investors accounted for 21 percent of first quarter transactions, versus 18 percent a year ago. First-time home buyers declined to 32 percent from 42 percent in 2010, when a tax credit was in place.
According to Freddie Mac, the national commitment rate on a 30-year conventional fixed-rate mortgage averaged 4.85 percent in the first quarter, up from a record low 4.41 percent in the fourth quarter, but below the 5 percent average in the first quarter of 2010.
This survey suggests a real estate market recovery in the short term. If you are considering a home on the North Fork, act sooner, rather than later. The activity has picked up substantially.
The author is a real estate broker and co-owner of Beninati Associates in Southold.
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