November posted the year’s largest percentage gain in home sales. The month saw a 59.6% jump in sales compared year ago figures, with 273 sales this year versus just 171 in November of 2008.
The looming deadline for the $8,000 first-time homebuyer tax credit surely had an impact in the size of the jump. The credit was set to expire November 30, 2009. The President signed an extension of the credit on November 6th. The credit will now be available on homes under contract by April 30, 2010.
Affordability has also been a driver in home sales. Average prices countywide are down about 8% since this time last year and down 12.4% since the peak in 2007. Those lower prices combined with mortgage rates below 5% have created some of the most affordable conditions on record.
Freddie Mac reported just today that interest rates on a 30 year, fixed rate mortgage are at the lowest level on record. In its weekly mortgage market survey for the week ending December 3rd, the company reports those rates averaged just 4.71%. The previous record low was 4.78%, set in April of this year. Freddie Mac has been tracking these rates since 1971.
These affordability conditions coupled with the recent expansion of the tax credit to cover certain repeat buyers should continue to propel sales through the winter months. The momentum has already started. Pending home sales, which are those under contract but not yet closed, just logged their seventh straight month of besting 2008 levels. In November, pending sales were up a healthy 7.5% over last year.
{ 2 comments… read them below or add one }