Real Estate Blog
Sunday, February 20 2011
Fast-Paced Real Estate News:
An Up-to-the-Minute Report
By Michael Ardolino, Broker
February 19, 2011
In recent days, the pace of real estate related news has picked up appreciably. Here’s a rundown:
The Economy, Unemployment & the Federal Government
Because the strength of the housing market is inextricably tied to the strength of the overall economy, we have seen many governmental policies aimed at real estate over the years. It seems that we are now at a crossroads:
According to the National Association of Realtors (NAR), it is imperative that the government support the housing market by continuing to allow the long-standing deduction for mortgage interest. This deduction encourages home buying, which, in turn, creates jobs. Quoting a recent NAR publication, “America needs jobs. Housing creates jobs.”
The National Association of Home Builders (NAHB) also tracks the economic impact of housing. As reported recently at MSNBC.com, the NAHB has calculated that every new home built generates $90,000 in taxes, and also creates the equivalent of three jobs for a period of one year.
Rates have been going up and are expected to continue to do so. Most experts predict that they will hit 5.5% by the end of the year. However, historically speaking, rates are still low. Many homeowners paid up to 16% in the past, so today’s 30-year rate of 5% is a huge economic benefit for buyers.
NAR Home Sale Stats
Nationally, the number of sales (the home sales volume) rose by a very healthy 15.4% in the fourth quarter of 2010. This indicates that excess inventory is being absorbed, which is necessary for a sustained recovery.
The Latest Stats From MLS Long Island
Figures recently released by the Multiple Listing Service show that sales volume is up locally as well as nationally: For Suffolk County, the number of closed sales for the year 2010 went up by 2.1%.
MLS reported a 16.5-month supply of inventory for our county. I’m happy to report that our local market is active, so we are chipping away at this excess inventory. The goal is a balanced market, which is 6-8 months of inventory. Once the market is balanced, we will begin to see stabilization and, ultimately, increases in home prices locally.
MLS also reported that housing affordability is up. This makes it easier for more people to buy homes and is welcome news as we enter the traditionally busy spring season.
More and more, it seems we are moving in the right direction locally.
As always, I am committed to keeping you abreast of market conditions. As a nationally recognized real estate expert with decades of professional experience, I’ll continue to provide updated information. For additional data, visit www.Ardolino.com, where you’ll also find my blog. If you need help understanding how real estate news affects you, call me at 631-941-4300 or e-mail: Michael@Ardolino.com .
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