Monday, May 3, 2010
by Don DeHanas, Associate Broker
We are now into the second quarter of 2010, and the housing statistics are quite interesting. As we near the end of the Tax Credit Incentive, inventory remains a primary concern. Single-family, detached inventory is down 17.7%, and townhome inventory is down more than 30%, as of the end of March 2010. In addition, the average days on the market has dropped by 30% to 106 days. Typically, these are indications that our market has flattened, and values are sustained, however, the data shows just the opposite.
As of the end of the first quarter, home values were down in Charles County by 11% year-to-date over last year. Much of the sales activity is taking place in the $200k-$299k price range, where we are seeing multiple offers on the more aggressively priced properties.
Future activity of Bank-owned properties is expected to increase significantly as evidence of the most recent pre-Foreclosure activity in Charles County. The amount of homeowners in default remained consistent month over month last year, around 900 each month. For the first time, we saw the number of homes in some state of foreclosure climb to over 1000 during the month of April according to Realist data. Moving forward into the summer, there are predictions of a second wave of foreclosures as reported by Credit Suisse & Clayton, and the Certified Distressed Properties Institute. This wave is expected to be as large, or larger than the last in spite of a series of lack-luster Government programs designed to help struggling homeowners.
Other factors that will shape the third and fourth quarters include; the ending of the tax credits for homebuyers, which ends April 30, 2010; The USDA’s popular Rural Development Loan has run out of funds, and local housing initiatives like the Neighborhood Conservation Initiative (NCI) have also run out of funding. In addition, interest rates, which have remained at all time lows, are expected to creep up through the remainder of 2010.
There is certainly no shortage of opinion and information when it comes to the Foreclosure Crisis as tv, news and on-line media have a wealth of articles favoring most any position one might have on the subject. All, however, agree that we have a long way to go before we are out-of-the-woods.
