Great news - the Southern Indiana Realtors Association statistics for October indicate that home sales rose 18% over the number of sales in October 2010. 
Unfortunately, the median sales price of $110,000 was down 6% over last October and year to date the median sale price is down 4%.
 Does this mean we are starting to see some recovery of the real estate market in Southern Indiana?  Only time will tell for sure, but with low interest rates and lower home prices the inventory is starting to shrink. 
The point is that homes are selling in Southern Indiana, so if you want or need to move don't let the media scare you.  Call us, we can make it happen for you.
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You have most likely heard how tough the real estate market has been for the past few years, but what you should be hearing is what an excellent time this is to BUY A HOME.

Rarely in real estate are interest rates and home prices both low – naturally, this creates a unique opportunity allowing people to BUY A LARGER HOME with little or no increase in your monthly payment.

For Example: If you currently have a $150,000 home with a $120,000 at 6.5% interest rate on a 30 year loan – your Principal and Interest payment would be: $ 759

Now let’s assume you purchase a $250,000 home and have a mortgage of $200,000 – at 3.75% interest rate on a 30 year loan – your Principal and interest payment would be: $926

 

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Southern Indiana Realtors Association has just released the statistics for home sales for the month of August 2011 and year to date.
Interestingly, the number of homes sold was up 16% from August 2010.  This is most probably due to the fact that by August of last year, the first time buyer's who purchased with stimulus money had already closed and there was the natural drop or lull in sales.  While the number was up, the median sale price is down 6.78%.
Year to Date statistics continue to show a decrease in both number of sales ad median sales price of about 5%....

Home sales reported by the Southern Indiana Realtors Association (SIRA) showed an increase of 31% in July or 2011 as compared to July 2010.  The Indiana Association of Realtor's (IAR) reported a similiar increase for the entire state with a 24% increase in sold listings.
The IAR also reported an increase in median sale price and pending sales while the Southern Indiana Realtors Association indicated a decrease in median sale price of 3.2% for those July sales compared to last year.
The numbers tend to indicate an increase in consumer confidence which when coupled with historic low interest rates, could spark an upward trend for real estate as we head into the fourth quarter....

Selling homes in Southern Indiana is a challenge just like almost everywhere in the country.  But homes are selling!  The secret to selling is for sellers to follow a few simple "rules".

1. Set a realistic list price - buyers are very knowledgeable about the market and values, they will decide quickly whether to look or pass based on the price.
2. Get the home in top condition - with the popularity of all the home fix-up television shows buyers expect to see all homes in move-in condition, they are not looking for fixer-uppers unless the price is deeply discounted.
3. Be flexible in showing the home - buyers generally will not come back if they can't see the home the first time they choose to see it.
4. Be willing to adjust the list price -  even with the best intention, the initial pricing could miss the mark.  The National Association of Realtors study says that if you have no offers after 10 showings or 8 - 9 showings with no offers, the market is telling you the home is overpriced.  Too many sellers sit too long on a price that isn't working.  Don't be afraid to drop the price early and often.

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Possible Government Shutdown affects Housing Market

Hopefully the federal government will come to an agreement today on the federal budget and funding before the midnight deadline.
A government shutdown would essentially throw the forward momentum happeningin  real estate into neutral.  In recent years, many buyers have turned to FHA because of the lower downpayment and higher debt ratios.  FHA loan funding would come to a halt with a government shutdown.
Also, at issue is the fact that FHA mortgage insurance premiums are set to increase effective for case numbers assigned on or after April 18, 2011. 
VA and rural housing loans will also be left without funding. 
Buyers scheduled to close the first of next week may be left out in the cold until or unless the government steps up to the plate and keeps the federal government functioning.
Not directly relevent to real estate, but interesting is the fact that congress will still receive a paycheck if the government shuts down, but our armed forces serving at home and overseas will NOT be paid.

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Mortgage rates for 30 year conventional loans have once again dipped below 5%.   Below the 5.2% first quarter average.

Home prices are still low, making this a great time to purchase a home.  Even if you are a move up buyer and may lose money selling your home, the amount you gain from buying in a depressed market coupled with low interest rates could mean tremendous savings when you look at the big picture.

Real estate really is a strong investment.  Despite the stunning crashes of the last few years, Forbes Stephane Fitch reported that real estate in the US is actually still worth 58 percent more per square foot than it was in 2000.

This may be the last window of real opportunity to buy with interest rates low and selling prices low.  Don't wait - there is only a brief second when the market reaches the bottom and the prices start to rise again!

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real estate recovery is slow, but data indicates positive signs

 

Although housing is still slow and home prices are still low in Southern Indiana and the US. there are positive signs that indicate a slow recovery is in process.

Home supply is the lowest it has been in a long time.  There are 10% less homes on the market from last year and the lowest since March 2006. 

Affordability stands at 14.1% - well below the historical average of 25%. 

Interest Rates are still hovering around 5% for 30 year loans and even less for 15 and 20 year loans.

Foreclosures - For the first time in almost 3 years, the number of homeowners falling behind on  their loans is declining. 

Tax incentives
 

The tax incentives have not resulted in the increase of move-up home buyers as the government was hoping for when it extended the tax credit to homeowners moving up after living in their home for 5 years.

Both the move up ($6500) tax credit and the first time homebuyers ($8000) tax credit is set to expire the end of April.  Homebuyers must have an accepted offer by 4/30/10 and close by 6/30/10

There is no indication that either tax credit will be extended, so buyers wanting to get in on the credit should get busy. ...