SPRINGFIELD (August 25, 2008). With historically low mortgage rates, a large selection of homes to choose from and great affordability it appeared as if it couldn’t get much better for first time homebuyers, according to Philip Chiles, ABR, GRI, president of the Capital Area Association of REALTORS®. “That was, however, until Congress recently approved a new temporary tax credit of up to $7,500 for first-time buyers. This new tax credit is expected to energize home sales over the balance of this year and the first half of 2009. I see this tax credit as being critical to helping remedy the imbalance that exists between supply and demand. It appears that many people are seriously considering home purchases and we expect the temporary tax credit for first-time buyers to energize home sales over the balance of this year and the first half of 2009,” said Chiles. Chiles encourages consumers who want to learn more about this tax credit to go to www.HopOffTheFence.net or contact their local REALTOR®.

For the month of July 2008 new listings amounted to 550, reflecting a decrease of 12.0 percent from July of 2007. Although new listings are down the inventory of homes for sale at the end of July was 1,983, nearly unchanged from the 1,976 homes for sale during the same time last year. Inventory is at its highest level for this time of year. According to Chiles, the reason why overall inventory is up and new listings are down is due to the fact that homes are staying on the market for longer periods of time. As of August 24 inventory levels were at 1,974, reflecting a 6.4 month supply at sales pace for the past twelve months.

The median single-family home sale price declined slightly while unit home sales also declined slightly in the Capital Area during July 2008, according to figures from the Capital Area Association of REALTORS® (CAAR) Multiple Information Service.

For the month of July 2008, the median home sale price (for all single-family homes and condominiums) was $104,500, revealing a decrease of 0.9 percent from the $105,500 July 2007 price. The year-to-date median home sale price through July of 2008 yielded $105,000, up 1.2 percent over the same period in 2007. The median is a typical market price where half the homes sold for more, half sold for less.

Home sales in the Capital Area during the month of July amounted to 370 units, just 5.3 percent below the 391 home sales recorded in July of 2007. Year-to-date home sales through July of 2008 revealed 2,132 unit sales, down 13.6 percent from the 2,468 during the same period in 2007. “July sales continue to reflect a trend toward a return to sales at the pre-boom 2003-2007 normal levels,” said CAAR president, Philip Chiles, ABR, GRI.

According to Chiles, although news about the housing market continues to be of great interest in the media, the focus seems to have shifted to the economy as a whole as analysts now point to the sluggish economy as the primary reason for continued downward pressure on the housing market.

The average cumulative days on market (CDOM) for homes that have sold during July of 2008 was 93 as compared to 88 during July of 2007. For the year-to-date 2008 the CDOM was 108 days as compared to 95 days during this same time in 2007.

The Federal Home Loan Mortgage Corp. reported that the national average commitment rate for 30-year, conventional, fixed-rate mortgages was 6.43 percent in July 2008, down from the 6.70 average rate during July of 2007.

The Capital Area Association of REALTORS® is the Voice for Real Estate in the Capital Area representing more than 700 members involved in all aspects of the real estate industry. The Capital Area’s Resource for Real Estate Information can be found at www.SeeHouses.com.

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