Memphis Real Estate Buzz » tax credit

Memphis area home sales – July 2010

Joe Spake — Fri, 10 Sep 2010 03:15:02 +0000

As expected, July sales dropped dramatically from July, 2009.Â The Memphis AreaÂ Association of REALTORSÂ® reports 995 sales for July, down from 1,369 last year. That’s about one sale for every 3.5 licensed agents inÂ MAAR.Â Â Year-t0-date sales are down only 1.6% from 2009, a number artificially inflated by the home buyer tax credits earlier in the year.Â Median sale price dropped 20.3% to $89,295.

So, 1 property per 3.5 agents.Â But that ratio might be even more skewed as 307 sales or 30.8%%Â were “bank sales”.Â MAAR defines “bank sales” as: “Bank sales represent all warranty deeds recorded in Shelby, Fayette and Tipton counties where the seller was a bank, REO company, or other similar institution.” Most people in the business call them REO’sÂ Real Estate Owned – in other words foreclosed,or other distressed homes being resold.Â Most REO properties in the area are handled by aÂ relatively small pool of agents, who have qualified themselves to work with certain banks, FHA, HUD, and REO companies.Â REO sales are down 21.2% YTD from last year, while non-REO (regular) sales are up 12.2% – a number that is probably also skewed by the tax credits.

I don’t have any profound proclamations about these stats.Â I think the market is still going to have to work through the impact of the tax credits earlier this year.Â As I mentioned in a post a few days ago, the credits have kept us from feeling a market bottom, and we are still anticipating one.Â Until we feel we have started a rebound, I am afraid the market will remain sluggish.

Click here for the full MAAR July Report which includes sales by neighborhoods, inventory and historic data.

Memphis: June 2010 home sales up from 2009 (memphisrealestatebuzz.com)

Joe Spake is a Memphis, Tennessee based Consultant, Real Estate Broker, and Blogger. Call 901.214.5563 for a consultation or click to make a social connection.
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3 reasons we don’t need another home buyer tax credit

Joe Spake — Sat, 04 Sep 2010 14:52:24 +0000

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Soon after HUD Secretary Shaun DonovanÂ dropped the hint, in a CNN interview, that there mightÂ be another home buyer tax credit on the horizon,Â the Calculated Risk Blog posted the thoughts of economist Tom Lawler, that rumors of of another credit would hurt the struggling real estate market by causing buyers to hesitate, or even stop working toward their purchase, in anticipation of the new credit taking effect.

Calculated Risk also reported that a HUD spokesman, when asked if a new home buyer tax credit might be in the works responded, “No news here…there are no discussions underway to revive the credit.”

I hope we don’t see another tax credit and that we don’t even hear any more rumors about one, and here’s why:

1.Â Without the previous tax credits, the real estate market would have corrected by now.Â As the market stands now, able buyers are waiting for the market to hit bottom, and there is a lot of conjecture that better deals are yet to come.Â Â Â The credits prolonged the inevitable market rockÂ bottom in prices.Â We won’t be able to call the bottom, only report on the recovery.

2.Â Phoenix Real Estate Blogger, Jay Thompson, is 100% correct that the prospect of receiving an$8,000 tax credit is a pretty poor reason for buying a house.Â Making the biggest purchase most people will in their lives should be based on a lot more complex reasons and financial considerations than collecting a fewÂ thousand bucks for doing the deal.

3.Â If the government is intent on spending money to to stimulate the housing market,Â why not spend some of it helping communities fix up blighted properties, HUD foreclosures, and neglected properties to make them eligible for mortgages?Â Bolster local initiatives to help people (owner-occupants) purchase in not so desirable areas?Â Sponsor community gardens?Â Help homeowners keep their homes?Â Ah, but not of that really puts much money in the real estate agent’s pocket; nor does any hint of government intervention in distressed properties and neighborhoods please real estate investors.

Home values in certain segments of this area are significantly eroded by rental properties nearby, yet Memphis continues to be touted as a great town for investors.Â Home ownership is still a big part of the American Dream.Â Owners take pride in their property and in their community.Â Renters have little investment other than their security deposit.Â Let’s use some of those Federal bucks to build some community pride.Â That’s the key to improving the housing market – and keeping our communities strong!

Real Estate Weekly: Home-buyer tax credit not likely to make an encore (marketwatch.com)
HUD Secretary: Who’s up for another homebuyer tax credit? (hotair.com)
Will the Homebuyer Tax Credit Return? Should it? (phoenixrealestateguy.com)

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Memphis home sales up for May

Joe Spake — Sat, 19 Jun 2010 18:34:24 +0000

According to MLS sales numbers released by the Memphis Area Association of REALTORSÂ®, May, 2010 home sales are up 16.4% from 2009Â (1,195Â vs. 1027) units.Â Â Well,Â duh.Â Can you say Home Buyer Tax Credits?Â Although Congress is trying to extend the closing deadline of June 30 for buyers who completed their contracts by April 30, 2010 to be eligible for the credit, the extension is currently stalled.Â Â I will really go out on a limb here and predict that year over year sales will also be significantly higher for June.Â Year to date sales are only up 2.9%.Â Remember 2009?Â It was a pretty dismal year for real estate.Â When all the tax credit folks get closed, we are going to see an un-skewing of sales figures that will shock you.Â But, for those who have followed the market, what is shocking is that 5 years ago in May 2005, there were 1,589 sales.

Median Prices continue to rise, as I explained in the last market report.

Also, I thought this chart was interesting:

75% of sales last month were under $200,000, and only 4.4% above $400,000.

As I always mention, these are MAAR’s MLS sales numbers.Â Â The official May Stats will be available July 15.

Download full June MLS Sales Report Here

I find that I am doing more and more consulting on real estate issues lately.Â If you are a homeowner, buyer or seller and have questions about the market, sales or buying strategies.

: Image by joespake via Flickr

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R.I.P Home Buyer Tax Credit

Joe Spake — Sat, 01 May 2010 14:31:30 +0000

The $8000 Federal Tax Credit for first-time buyers ($6500 for non-first-timers) expired last night at midnight.

If you were truly in a position to buy a home, and didn’t make your move, you missed your chance to pick up some easy money.Â If you were a motivated, ready, willing and able buyer and took advantage of the credit, congratulations on a smart move.

If you weren’t really ready to buy a home, either mentally or fiscally, but were pressured into a purchase with the tax credit used as leverage, good luck!

If you weren’t ready to buy and didn’t because this whole rush for the bucks just didn’t feel right to you, no need to feel guilty; you probably avoided a big mistake.

While the 2 rounds of the tax credit may have (artificially) stimulated the housing market for a while, the program kept the market from finding its real bottom.Â I am not an economist, but I think real recovery is market based, andartificial Federal props, like the tax credit, have actually delayed recovery by generating skewed sales information.

Now I can finally remove those count-down widgets from this blog and my website.

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Only 7 days left for the $6500-$8000 tax credit

Joe Spake — Fri, 23 Apr 2010 13:06:29 +0000

It’s not over yet, but you MUST be under contract by April 30, 2010 (with closing by June 30)Â to be eligible for the (up to) $8000 tax credit for first time home buyers or (up to) $6500 credit for buyers who have owned before.

So if you are are a buyer and you typically wait until the last minute, you better think real hard about putting your deal together.

If you are in Memphis and need the help of an agent, contact me.

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