Market Update: Government Shutdown to Put Brakes on Market

posted on October 16th, 2013 | filed under: Uncategorized

Many, but not all, government agencies involved in the real estate market have either closed or curtailed their activities since congress failed to approve funding.Treds 10.13.146

The IRS is closed and has suspended the processing of all forms. Some of these forms, particularly tax return transcripts, are required for many kinds of loans, including FHA and VA.

SSA is also closed and will not be verifying social security numbers, a further complication for mortgage processing.

The FHA will continue to endorse new loans for the Single Family Mortgage Loan Program, but will not make new commitments to the Multi-family program.

Lenders will continue to process and guaranty mortgages through the VA Loan Guaranty program. Expect some delays.

SEPTEMBER MARKET STATISTICS

The median price for single-family, re-sale homes rose 20.5% year-over-year. That’s the thirteenth month in a row the median price has been higher than the year before by double-digits. It’s seventeen months in a row of year-over-year increases.

Sales were off 8.5% year-over-year. Year-to-date, home sales are up 0.5%.

Inventory remains problematic. There is only a ten week supply.

Pending sales were off 2.3% compared to last September.

SALES MOMENTUM…for homes fell one point to +4.6. Condo sales momentum rose 0.1 of a point to +5.4.

PRICING MOMENTUM…made another solid gain last month, rising 0.5 of a point to +16. Condo pricing momentum gained 0.7 of a point to +22.8.

WE CALCULATE…momentum by using a 12-month moving average to eliminate seasonality. By comparing this year’s12 month moving average to last year’s, we get a percentage showing market momentum.

CONDO STATISTICS…The median price for condos was up 30.9% year-over-year. That’s fifteen months in a row the median price has risen by double-digits.

Sales were up 4.3% from last September.

The sales price to list price ratio declined for the fourth month in a row: 99.6%.

This is an extraordinarily tough market for buyers. It’s important to be calm and realistic. If you don’t know what to do or where to begin, give me a call and let’s discuss your situation and your options.

posted by Jeff DeChamplain

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Jeff DeChamplain