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New Homes Built Lag While Demand Rises

by Galand Haas

Good Monday Morning!

Sales of new homes have lagged over the recent upswing in home sales not only locally, but nationally.  In the Eugene and Springfield area the problem is simply that we are out of affordable land for home sites.  The local government has put a halt on expansion of the urban growth boundary and the amount of land that is available for building has all but gone away.  This has not only driven up building lot prices, but it has made it difficult for home builders to find lots suitable for buidling new homes.  Also the recession has not been forgotten by many builders and they are wary of building spec homes.  This also has created a decrease in the numbers of news home being built and on the market.  Here is an article from Realtor.com that addresses this situation nationally.

Despite the hordes of frenzied home buyers hoping to take advantage of very low mortgage interest rates and sign on the dotted lines for their dream homes, builders still aren’t putting up nearly enough residences to appease the rising demand.

There was no monthly change in the number of newly constructed homes that went under contract—54,000, to be exact—from May to June, according to a new residential construction report from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. But compared with June 2015, sales of the brand-new properties were up 22.7%.

The numbers were not seasonally adjusted, which means they weren’t smoothed out over a 12-month period to account for the ups and downs of home buying at different times of the year.

“[Builders aren’t] taking any risks. They aren’t starting homes without buyers,” says Jonathan Smoke, chief economist of realtor.com®. Builders are taking orders for the bulk of new abodes, he says, instead of building them on spec. And “they’re not offering homes in more affordable price points.”

New homes, complete with brand-new appliances, typically cost more than existing residences. For example, the median price of the new homes was $306,700 in June, according to the report. That was up nearly 6.2% from May and almost 6.1% from the same month a year earlier.

Meanwhile, the median price of an existing home reached an all-time high of $247,700 in June—still a relative bargain selling for a whopping 23.8% less than a new home, according to National Association of Realtors® data.

In June, just 3,000 new homes costing less than $150,000 were sold, according to the government report. Buyers closed on an additional 12,000 selling for between $150,000 and $199,999. But the bulk of sales were in the $200,000 to $499,999 range. About 33% of the sales were in the $200,000 range, 21% were in the $300,000 range, and 18% were in the $400,000 range.

“[Builders either aren’t] trying or they’re not capable, in this environment, of offering lower price points,” Smoke says.

Across the country, monthly sales of new homes remained virtually unchanged from May to June, according to the report.

The West was the only region to see a monthly uptick as buyers signed on the dotted line on 14,000 new residences—up nearly 7.7% from 13,000 the previous month. They were also up almost 27.3% from the same time a year earlier.

Sales were up annually 50% in the Northeast, with 3,000 homes purchased in June. They rose 33.3% year over year in the Midwest, with 8,000 sales, and 20.8% year over year in the South, with 29,000 sales.

Have An Awesome Week!

THIS WEEKS HOT HOME LISTING!

1471 Barrington Ave

Price: $549,900    Beds: 5    Baths: 3    Sq Ft: 3756

Luxurious and grand! Great room with surround sound speakers, Brazilian cherry hardwood floor & gas fireplace. Huge theater/bonus room prewired for surround sound. Open kitchen with cherry stained cabinets, island, LED under & above cabinets & toe k...View Home for Sale >>


AND HERE'S YOUR MONDAY MORNING COFFEE!!

U.S. Homes Sales Decline 27% in July!

by Galand Haas

Our weather has certainly made a sudden change.  Not to say that a little rain is not a welcome site, it is hard to have the sun leave us even if it is just for a few days.

With sharp drops in sales of existing and new homes being broadcast in the newspaper and leading the nightly newscasts, it's it’s hard to keep a positive perspective about the housing market.

A surprising 27 percent decline in resales from June to July, and a 12 percent drop in sales of newly-built houses during the same period have done very little to build consumer confidence in the market.

Even with this news there are some positive things starting to happen in the national housing market. Housing affordability is at or near an all time high.  This has been created by the lower home prices and mortgage interest rates for thirty year fixed mortgages in the mid 4% range.  Right now 72 .3 percent of median-income American families can now afford to buy the median-priced house. Historically that number has stayed in the low 60 percent range, and sometimes slipped below 50 percent.  But the problem remains that even with the affordability factor being so great, consumers are holding back.  The overall lack of confidence is the reason and the employment figures just fuel the lack of confidence.  Look for a sharp rebound in the market when employment numbers begin increase and buyer confidence returns. 

We were all warned that there would be a sharp drop off in home sales following the tax credit.  We are witnessing what was predicted.  The good news is that the lull could be short lived.

Have an Awesome Week!

THIS WEEKS HOT HOME LISTING!

Image Unavailable
3835 E Street
Price: $139,900 Beds: 3.00 Baths: 1 Sq Ft: 1200
Wonderfully updated home with Hardie-plank siding, granite countertops, new appliances, new carpet, fresh paint, and new fixtures. W/ a vaulted living room, light & bright kitchen and dining room set on a fun floor plan, a welcoming front porch, gre...



AND HERE'S YOUR MONDAY MORNING COFFEE!! 

Sincerely,
Galand

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Galand Haas, Keller Williams Realty Eugene and Springfield
2644 Suzanne Way, Eugene OR 97408 
Direct: (541) 349-2620

Monday Morning Real Estate Update 6/28/07

by Galand Haas

Good Monday Morning!

I was great weekend in the Eugene and Springfield area.  Not to hot!  Not too cool! Perfect for Fathers Day!

Nationally the troubled housing market continues to show signs of weakness.  New permits for housing starts hit a 17 year low last month.  This adds validity to the fact that existing new homes just are not moving.  At the same time mortgage interest rates have continued to creep even higher.  If this trend continues look for the overall national market to continue it's downward trend.

Locally, our market continues to hold on.  Watch mortgage interest rates.  The direction of these rates Will determine where our local market heads in the near future.

Have An Awesome Week!

 



AND HERE'S YOUR MONDAY MORNING COFFEE!!

Sincerely,
Galand

Monday Morning Real Estate Update 3/12/07

by Galand Haas

Good Monday Morning!

Wow! 75 degrees on Sunday. It was a new record high temperature for that date! Congratulations to the Oregon ducks men's basketball team for winning the Pac 1o tournament and now moving on to the NCAA tournament.

The home sales statistics are in for last month.  There were 558 new homes hitting the market.  This was in comparison to 510 for the same month in 2006.  There were 257 closed sales, which was the exact same number as February of 2006.  The average time on the market increased to 76 days.  This is compared to 55 days during the same month of last year.  The average sales price was $243,700, which is up from $236,600 for February of 2006.

As you can see the largest difference from a year ago is the time it takes a home to sell and the average sales price. So there goes the thought that we have a bad RealEstate market here in the Eugene and Springfield area.

Have An Awesome Week!

 

 



AND HERE'S YOUR MONDAY MORNING COFFEE!!

Sincerely,
Galand

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Photo of Galand Haas Team  Real Estate
Galand Haas Team
Keller Williams Realty Eugene and Springfield
2644 Suzanne Way
Eugene OR 97408
Direct: (541) 349-2620
Fax: 541-687-6411

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