Comments on: October 2009 Seattle condo market update

By: Ashlee

Ashlee — Tue, 10 Nov 2009 02:11:38 +0000

Here is Texas we have def. seen an increase in buyers since the expansion of the tax credit.

By: Ben Kakimoto

Ben Kakimoto — Mon, 09 Nov 2009 19:54:15 +0000

The first time home buyers tax credit has contributed to greater sales volume this year. In looking at sales volume of condos under $350,000 for the past several months, the percentage of sales under $350,000 relative to total sales have increased greatly this year compared to prior years.

October messed that thinking up a bit. Sales of units under $350,000 in October 2009 accounted for 69.3% of total sales; in October 2008 it was 73%. Not only did the year-over-year figure decrease, there was a smaller percentage of sub-$350,000 units sold (69.3%) compared to prior months as well.

Unit sales of sub-$350,000 units for October 2009 and 2008 were 129 and 119, respectively, an increase of 10 units sold or 8.4%. Therefore, it’s difficult to say the tax credit, alone, had much of an impact on sales last month. Better values and low interest rates probably had considerable influence as well.

November will be more telling as closings this month went under contract back in September and October and tax credit buyers were up against the deadline, noted by the huge spike in Pendings last month.

Had the extension/expansion not been approved, I would have anticipated a drop in activity going forward. There’s going to be a significant decrease from November to December (rush to meet the old deadline artificially boosts November figures) and the cyclical slowdown. Though, I do think the extension will stabilize the market further. (Note: the market was fairly stable this year – median prices plateaued, inventory supply rate normalized.)

I don’t think the expansion will have much impact; $6,500 doesn’t seem sufficient to incent a current homeowner to buy a higher priced home, plus it’s limited in that owners must have lived in the property for 5 of the last 8 years. Rather, it’s a “bonus” for those qualified buyers who are planning to move-up. The same could be said of the first-time buyers credit, but I think $8,000 is more significant to a first-time buyers as are different motivational factors.

By: Frank

Frank — Sun, 08 Nov 2009 23:31:03 +0000

Some demands definitely have been brought forward by the home buyer credit, it will be very interesting to see the effect of the newly expanded credit – will that encourage enough people to sell their home and buy condo (or vice versa) and hence activate the market?

By: ella

ella — Sun, 08 Nov 2009 15:07:06 +0000

Just wondering…?

Has demand for condos been brought forward with the looming expiration of the 1st time home buyer credit in Nov 2009? Year over year closed sales data for most of this decade has a pattern of diminishing sales in the fall but this year the trend has been broken with increased sales in the fall.

If the demand was brought forward then what does that mean for future sales. Is this going to look like the cash for clunkers program which produced a bubble of sales that diminished rapidly when the program ended?

If sales fall will prices fall with them? We will have to wait and see.

By: Geordie Romer | Leavenworth WA

Geordie Romer | Leavenworth WA — Sun, 08 Nov 2009 00:31:24 +0000

We are seeing an uptick in condo sales in Leavenworth this fall, but unrelated to the first time home buyer credit. Last year at this time our first condo auction froze the market while folks waited to see what was going to happen. This year, savvy investors and vacation home buyers are taking advantage of oversupply and buying condos at big discounts over past pricing.

http://iciclecreekrealestate.com/2009/10/19/leavenworth-condo-update-fall-2009/