Bradenton, Sarasota, Manatee County, Sarasota County Real Estate Market Report - September 2009

8/14/2019 Bradenton, Sarasota, Manatee County, Sarasota County Real Estate Market Report - September 2009

1/10

1

Keller Williams Research

This Month in Real EstateThe Serena Group

Released: September 14, 2009

14Research for Buyers and Sellers.

Recent Government Action.

The Numbers That Drive Real Estate

Commentary.

10

4

2

Email:Email:Email: [email protected]@[email protected]

Direct: (941) 725Direct: (941) 725Direct: (941) 725---446244624462

Website:Website:Website:www.TheSerenaGroup.comwww.TheSerenaGroup.comwww.TheSerenaGroup.com

KW Research 2

Green Shoots of Recovery

Some economists believe that the almost two-year-long economic recession ended in June,and theyre forecasting a return to growth in 2010. So while the encouraging news points toprosperity ahead, the overall economy may continue to run into some road bumps along theway. In the meantime, the strengthening housing market indications bode well, as buyerconfidence is increasing with affordability playing a big role.

Looking at existing home sales, the July numbers far exceeded expectations. In fact, for thefirst time in five years, existing-home sales have increased for four months in a row. Thatsa lot of activity. So whos buying, and what are they buying? First-time buyers continue topace the market. They purchased 30% of homes in July. And distressed homes accountedfor 31% of overall transactions.

The numbers indicate critical activity is occurring at the bottom of the property ladder, andthis activity is triggering much-needed trade-up transactions. With the gains in sales,excess inventory continues to be absorbed. And with rosier economic forecasts for 2010,the buyer psychology may be shifting from, Why buy now when I can purchase later, to Idont want to miss out on a recovery, said Lawrence Yun, NAR chief economist.


2/10

KW Research 3

Green Shoots of Recovery

.An additional positive factor is the continued stabilization in housing prices. While pricesare lower than they were at this time in 2008, home prices have risen from where theystood at the beginning of 2009. And thats great news. As the prices hold more firmly,creditworthy borrowers are acting quickly to lock in near historically low mortgage rates.These rates, coupled with excellent affordability, make for an impressive buyingopportunity for savvy investors sitting on the sidelines. As long as home buyers staywithin their budget, mortgage payments will be very manageable, Yun said.

On the broader economic front, while unemployment remains a major concern, thegovernment has had solid success with its spending programs. The first-time homebuyer tax credit and cash for clunkers automobile programs are considered greatconsumer successes. Additionally, a proactive Federal Reserve is working to keepinterest rates at low levels as long as necessary. So while high unemployment will weighon the economy for some time to come, governmental action, economic expertise, and

time should deliver us to greener returns in the months to come.

KW Research 4

The Numbers That Drive Real Estate


3/10

KW Research 5

Home SalesIn Millions

4.93

5.24

4.89

4.72

4.71

4.49

4.74

4.54

4.94

5.10

4.99

4.66

4.55

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul

Seasonally Adjusted Home Sales Up 7.2% from

last month

Latest data release: August 21, 2009

Source: National Association of Realtors

Existing home sales rose 7.2% to an annual rate of 5.24 million in July, markingthe first time in five years home sales have increased for four consecutivemonths. The monthly gain was also the largest on record since 1999. First-timehome buyers, who accounted for 30% of all home sales in July, continue to bethe driving force for the housing markets recovery.

KW Research 6

Median Home PriceIn Thousands

$210 $203 $191 $186 $180 $176 $165 $168 $175 $182 $178$167$170




Existing-home price was $178,400 in July, an 8% bounceback from its low inJanuary but still 15.1% below the level seen last July. Distressed properties,which accounted for 31% of all transactions in July, continue to put downwardpressure on home price as they typically sell for 15-20% less than traditionalhomes.


4/10

KW Research 7

Inventory - In MillionsNumber of homes available for sale

4.3

4.1

3.8

3.93.8

3.6

3.7

4.24.2

4.3

4.6

3.9

3.6


Total housing inventory at the end of July rose 7.3% to 4.09 million existinghomes available for sale, representing a 9.4-month supply at the current salespace. This was unchanged from June as the greater inventory was met with thestrong sales gain. Compared to a year ago, when the number of unsold homeswas at a record, there are now 10.6% fewer homes on the market.



Number of HomesAvailable for Sale

KW Research 8

Mortgage Rates30-Year Fixed

Source: Freddie Mac

Rates for 30-year fixed loans edged down to 5.08% in the first week ofSeptember. While above the unprecedented 4.78% reached in the spring, ratesstill remain at attractive levels for people looking to buy a home or refinance.According to Frank Nothaft, Freddie Macs chief economist, "Low mortgagerates are helping to keep housing very affordable."

5.59%

5.29%

5.12%

5.14%

5.08%

5.22%

4.80%

4.78%4.82%

4.87%

5.15%

5.03%

5.01%

5.12%

5.10%

5.25%

5.16%

5.04%

5.07%

4.98%

4.85%

4.78%

4.96%4.84%

4.86%

4.82%

4.91%

5.29%5.38%

5.42%

5.32%

5.20%

5.25%

5.14%

5.20%

1/8

1/22

2/5

2/19

3/5

3/19

4/2

4/16

4/30

5/14

5/28

6/11

6/25

7/9

7/23

8/6

8/20

9/3

Average Weekly Mortgage Rates


5/10

KW Research 9

21% 20% 20% 19% 21% 23% 25% 24% 16%20%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009Affordability as of July every year. Calculations assume a 20% down payment.


Affordability - % of IncomeThe percentage of a median familys income required to make mortgage payments on a median-priced home

Housing affordability continues to be at record highs this year with the addedstimulus of the first-time buyer credit. So far this year, payment percentageshave been the lowest on record dating back to 1970. A typical mortgagepayment on a median-priced home historically has consumed 25% of a middle-income familys monthly earnings, its now taking up only16%. According toLawrence Yun, NAR chief economist, As long as home buyers stay within theirbudget, mortgage payments will be very manageable.

% of Income Required for Mortgage Payments on a Median-Priced Home

Well below the

historical

standard 25%

KW Research 10

Recent Government Action


6/10

KW Research 11

Cash for Clunkers Huge SuccessAugust 2009

Source: The Washington Post

Cash for Clunkers began July 24 with such overwhelming demand that

the program, originally set to expire November 1, burned throughfunding with amazing speed. In the first week alone, the incredibledemand depleted the entire budget of $1 billion. A second round of $2billion in funds extended the programs life by a few weeks, but theprogram ended on August 24 with no plans to revive or extend it.

The success of the program has put 690,000 new fuel efficient cars onthe road and has saved jobs in the auto industry. In some cases it haseven brought laid-off employees back to work. For example, GMannounced plans to reinstate almost 1,400 employees and addovertime for a substantial number of existing employees.

The governments $8,000 first time-home buyer tax credit has also seentremendous success with first-timers making up 30% of all buyers inJuly. First-time buyers made up as much as half of all buyers in earlier

months this year. As the tax credit reaches its expiration, thegovernment may take a similar approach as with the Cash for Clunkersprogram declaring it a success and unwinding the program.

KW Research 12

On August 20, the first phase of the credit card bill that was approved in May took effect.

Key changes in the way credit cards work include:

1. Customers will now receive 45 days notice,up from 15 days, before interest rates increase.

2. The minimum balance due can increase by no morethan two times the percentage that it previously has been.

3. Bills must be mailed 21 days, up from 14 days,before the payment is due.

The balance of the bills provisions will become effective in February. Until then,consumer advocates concerns center around credit card issuers continuing to increaserates, lower credit limits, decrease rewards programs, and close inactive accounts. Credit

card companies reaffirm these actions are not due to legislation but decreasing creditscores.

This bill intends to help consumers control credit and unknown expenses. As consumersconsider buying or selling a home, knowing monthly expenses becomes increasinglyimportant in understanding how much they can afford and are comfortable spending onhousing.

Phase I of Credit Card Bill Rolls OutAugust 2009

Source: The Washington Post


7/10

KW Research 13

President Obama announced Federal Reserve

Chairman Ben Bernankes reappointment onAugust 25. Largely supported by many of thenations economists, the reappointment willallow continuity in the Feds policies. This willprovide some stability as there will not likely bedramatic changes.

Earlier in the month, the Federal Open Market Committee (FOMC) meetingresulted in the Fed confirming its commitment to purchase $300 billion inTreasury securities. It will complete the remaining purchases by the end ofOctober. The interest rate on Treasury securities is closely tied to mortgagerates. The purchase of these securities is one of the most important componentsin keeping mortgage rates low.

The overall tone of this months meeting involved more caution and less

enthusiasm than expected. The Feds message: While economic signsdocontinue showing some improvement, full recovery will take longer than previousrecessions.

Fed Confirms Commitment, Bernanke ReappointedAugust 2009

Source: The Washington Post, Dow Jones, The Wall Street Journal

KW Research 14

Research for Buyers and Sellers


8/10

KW Research 15

Motivation for Moving

More Moving for Positive Reasons & Less for Recession

Half of people surveyed by Relocation.com moved to improve their livingsituation. This is a huge improvement from last March when the majorityof people moved due to the recession.

Source: relocation.com

26% moved to live in a bigger or better home

24% moved into a better neighborhood

12% moved to be closer to family or friends

9% moved into an area with a lower cost of living

6% moved due to a change in marital status

3% or less for each of the following: school, job loss, retirement, or foreclosure

KW Research 16

First-Time Home Buyers SurveyWhat are other first-time home buyers doing?

1. The median age is 28, significantly downfrom where it was four years ago at 32.

2. The median home size was 1,600 sq ft.

3. Location or Neighborhood was the No. 1must-have for 36% of buyers.

4. 2 out of 5 first-time buyers purchased adistressed property.

5. 2 out of 3 sellers paid at least part of thebuyers closing costs.

6. 76% used their own savings for the down payment.

7. 1 in 4 had help from their family for the down payment.

Source: KW Research First-Time Home Buyer Survey


9/10

KW Research 17

Your Local Market

Although it is important to stay informed about what is going on in thenational economy and housing market, many different factors impactthe real estate market in your area.

Talk to THE SERENA GROUP for assistance

interpreting the conditions in the Sarasota, Bradenton,

Manatee County & Sarasota County areas of Florida.

As Keller Williams associates, we are equipped with all the knowledge

and information to help navigate you through the process of buying orselling a home in this challenging market.

KW Research 18

About Keller Williams Realty

Founded in 1983, Keller Williams Realty, Inc., is an international real estatecompany with more than 74,175 associates and 693 offices located across theUnited States and Canada. The company began franchising in 1991, and followingyears of phenomenal growth and success, became the third-largest U.S.residential real estate firm in 2009.

The company has succeeded by treating its associates as partners and shares itsknowledge, policy control, and company profits on a system-wide basis.

Focusing on helping associates realize their fullest potential, Keller WilliamsRealty is known as an industry leader in its family culture, unmatched education,profit sharing business model, phenomenal coaching program, and technologyofferings. The company provides associates with all the tools needed to grow and

thrive in todays market.

www.kw.com


10/10

KW Research 19

For More Information About Market ConditionsFor More Information About Market Conditions

Or About the Buying a HomeOr About the Buying a Home

or Selling a Homeor Selling a Home

Contact THE SERENA GROUP, Today.Contact THE SERENA GROUP, Today.

We Would Be Honored to Guide You ThroughWe Would Be Honored to Guide You Through

The Process!The Process!

Email:Email: [email protected]@TheSerenaGroup.com

Direct: (941) 725Direct: (941) 725--44624462

Website:Website:www.TheSerenaGroup.comwww.TheSerenaGroup.com

Bradenton, Sarasota, Manatee County, Sarasota County Real Estate Market Report - September 2009

Documents

Transcript of Bradenton, Sarasota, Manatee County, Sarasota County Real Estate Market Report - September 2009