A recent Wall Street Journal article quotes recent homebuyers nationwide who admitted they felt like they were missing out on the American dream to buy a home and build equity. But market conditions nationwide have brought housing affordability back to reality and to many neighborhoods, and one group of buyers especially has been benefiting. The article states: “The housing bust is creating a new group of winners: first-time home buyers. People who sat on the sidelines – often watching wistfully as their friends became homeowners – are suddenly in a position to grab some great deals. Indeed, first-time home buyers made up 41 percent of all buyers at the end of 2008, up from 36 percent in 2006, according to a recent survey from the National Association of Realtors.

 

“… In some markets, prices have dropped even further -- slumping around 40% in Phoenix, Miami and Las Vegas. Lower mortgage rates have also helped make real estate more affordable, and as houses languish on the market longer, more home owners are willing to negotiate. With Congress considering plans to sweeten a tax credit for first-time home buyers, the picture could get even brighter.

 

"Buyers are now coming back into those hard-hit markets to take advantage," says Lawrence Yun, chief economist for the Realtors' association. "It's a buyer's market."

 

 

 

In an agreement reached by federal lawmakers on February 11, a new stimulus package will bolster the nation’s economy in four broad categories, one of which is housing.

 

While many details are not yet available, initial calculations showed that the bill includes a new $7,500 tax credit for home buyers available through Sept. 1, 2009. Unlike the previously-implemented tax credit, this one does not need to be repaid. The tax credit will be retroactive for homes purchased since January 1, 2009. Income limits are still in place.

 

Loan limits for GSE/FHA products will once again increase to 115 percent of the area median through 2009. Additional details will be made available on realtor.org.

 

 

Regarding the national housing scene, Lawrence Yun, NAR chief economist, said the market is clearly affected by job losses and consumer concerns about the economy. “Assuming housing provisions in the economic stimulus package are quickly enacted and provide enough encouragement for home buyers, we could see a quick lift in home sales for the critical spring home-buying season,” he said.

 

“If that occurs, we could see home prices begin to stabilize in many metro areas later this year as supply and demand begin to return to balance, which would greatly benefit the overall economy,” Yun said.

 

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage fell to 5.86 percent in the fourth quarter from 6.32 percent in the third quarter; the rate was 6.23 percent in the fourth quarter of 2007.

 

 

 

A total of 998 homes sold in January 2009, a 39.39 percent increase above January 2008 home sales of 716.

 
Active listings decreased by 15.58 percent from last year, with 7,545 active listings in January, compared with 8, 937 homes available in January 2008. The average days on market (DOM) for homes in January 2009 decreased by 19.51 percent, to 99 days, compared with 123 days in January 2008.
 
Sales prices continue to remain lower than those realized last year. The average sales price in January fell by 22.51 percent from January 2008, to $376,669, compared with last January’s average of $486,060.
 
The median price of homes sold in Northern Virginia in January was $320,000, which is a decline of 20 percent compared with January 2008’s median price of $400,000.
 

Greater Northern Virginia: January 2009

Sales activity in Greater Northern Virginia (NVAR jurisdictions plus Prince William, Loudoun and the Greater Piedmont counties) for January 2009 continues to show an increase from 2008.
 
The number of Greater Northern Virginia region homes sold in January was 2,132, a 55.51 percent increase from January 2008’s total of 1,371 sales. This marks the tenth consecutive month of increased year-over-year sales totals for Greater Northern Virginia.
 
The average sales price of $303,275 in January 2009 continues to lag behind the 2008 average by 28.23 percent. The January 2008 average sales price was $422,591.
 
Across Greater Northern Virginia, the number of listings showed a decrease from 2008 numbers, with 15,295 listings active, which is 25.36 percent less than this time last year, when 20,493 homes were available. The average DOM for a home sold in January 2009 was 105 compared with last year’s 129 DOM, a decrease of 18.65 percent.