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Lake Tahoe Real Estate Market News
APR.
HIGHLIGHTS:

Deb Howard & Co. Newsletter
April 2008

 
EXISTING HOME SALES RISE IN FEBRUARY

WASHINGTON, March 24, 2008 - Sales of existing homes increased in February and remain within a fairly stable range, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.9 percent to a seasonally adjusted annual rate (1) of 5.03 million units in February from a pace of 4.89 million in January, but remain 23.8 percent below the 6.60 million-unit level in February 2007. The sales pace has been in a fairly narrow range since last September.

Lawrence Yun, NAR chief economist, said the gain is encouraging. “We’re not expecting a notable gain in existing-home sales until the second half of this year, but the improvement is another sign that the market is stabilizing,” he said. “Buyers taking advantage of higher loan limits for both FHA and conventional mortgages will unleash some pent-up demand. As inventories are drawn down, prices in many markets should go positive later this year.”

The national median existing-home price (2) for all housing types was $195,900 in February, down 8.2 percent from a year earlier when the median was $213,500. Because the slowdown in sales from a year ago is greater in high-cost areas, there is a downward pull to the national median with relatively fewer sales in higher priced markets.

Home prices within metropolitan areas are more telling. The most recent data shows roughly half of the metro areas in the U.S. with price increases, with healthy gains in markets such as Oklahoma City and Trenton, N.J. “In other areas such as Sacramento, a rapid price decline has induced buyers to come into the market and sales are now rising,” Yun said. “The relationship between home prices, interest rates and income has improved to the point where buyers are more serious about making offers.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.92 percent in February from 5.76 percent in January; the rate was 6.29 percent in February 2007.

NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said that negotiation and knowledge are even more important in the current market. “Consumers need to be aware of local market conditions and comparable sales prices to have a clear picture of a home’s value,” he said. “Realtors® understanding of local markets, negotiating expertise, and transaction experience are invaluable to both buyers and sellers, today as much as ever.”

Total housing inventory fell 3.0 percent at the end of February to 4.03 million existing homes available for sale, which represents a 9.6-month supply (3) at the current sales pace, down from a 10.2-month supply in January.

Single-family home sales increased 2.8 percent to a seasonally adjusted annual rate of 4.47 million in February from an upwardly revised 4.35 million in January, but are 22.9 percent below 5.80 million-unit level a year ago. The median existing single-family home price was $193,900 in February, down 8.7 percent from February 2007.

 

 

Existing Home Sales Rise in February

House Bill Includes Increased Loan Limits

More Californians can now afford homes

Mortgage Rates Continue Lower

Mortgage Market Outlook Improving

California Housing Affordability Rises

FOMC Lowers Rates

Team Announcements

MLS Statistics

C.A.R. Statistics

Mortgage Rate Update

Comparison Stats for
SLT Real Estate

 
Lake Tahoe Real Estate Broker
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Existing condominium and co-op sales rose 3.7 percent to a seasonally adjusted annual rate of 560,000 units in February from a downwardly revised 540,000 in January, and are 29.7 percent below the 797,000-unit pace in February 2007. The median existing condo price (4) was $211,700 in February, which is 4.9 percent lower than a year ago.

Regionally, existing-home sales in the Northeast jumped 11.3 percent to an annual pace of 890,000 in February, but are 26.4 percent below February 2007. The median price in the Northeast was $264,800, up 0.4 percent from a year ago.

More on this story

Source: Realtor.org (National Association of Realtors)


CONGRESS SENDS PRESIDENT STIMULUS PACKAGE
FINAL BILL INCLUDES INCREASED LOAN LIMITS


Thanks in part to lobbying by C.A.R. and NAR members, the Senate passed their version of an economic stimulus package today, Thursday, February 07, 2008. The Senate version expands rebate checks for seniors and disabled veterans and includes the same increases to the conforming loan limits for both GSE and FHA found in the House stimulus package. The House just passed the Senate version of the bill and it will now be sent to the White House. The President is expected to sign the legislation by the end of next week, ahead of the Congressional self-appointed deadline of February 15th. The increase in the conforming loan limits will last through 2008, but C.A.R. and NAR continue to lobby for FHA and GSE reform, making these increases permanent.

The U.S. House of Representatives passed a stimulus package last week that raised the FHA and conforming loan limits to as high as $729,750 in high-cost areas. By increasing the loan limits, borrowers will see immediate relief with new liquidity in the mortgage market and the nation will see an additional 300,000 home sales. Research shows that an increase in the FHA limit would enable an additional 138,000 Americans to purchase homes, and 200,000 families to refinance their homes safely and affordably.

Increasing the FHA loan limits is critical to bolstering California’s housing market. Current law restricts FHA loans to levels well below the median home price in many areas of the country and caps loans in high cost states at $363,790. These limits are preventing many homebuyers from using FHA to purchase or refinance their loan. The proposed provision will increase FHA loan limits nationwide by raising the floor to $271,050 and the limit to 125% of local median home prices.

Additionally, raising Fannie Mae and Freddie Mac’s (GSEs) conforming loan limit will provide immediate relief to borrowers and alleviate downward pressure on current housing markets. For instance, increasing the GSE loan limit could result in more than 300,000 additional home sales and strengthen current home prices by 2-3%.

The critical role that GSEs play in providing liquidity to the mortgage market has never been more evident than it is today. The national subprime meltdown has had a dramatic impact on both the cost and availability of mortgages in many markets. Since August 2007, the interest rates for jumbo borrowers have been more than 1 percentage point higher than conforming loans, which can cost homeowners up to $400 month in higher interest payments.


MORE CALIFORNIANS CAN AFFORD TO BUY THEIR FIRST HOME

According to the California Association of Realtors at least a third of California households could afford to purchase their first home during the last 3 months of 2007. That is a rather dramatic increase from 25% affordability just a year ago. C.A.R. calculates first-time buyer affordability based on the minimum household income required to make a 10 percent down payment and secure an adjustable interest rate loan at 6.21 percent.

In South Lake Tahoe, the median price of a home has declined over the past 12 months, now making home ownership viable for many that may have previously thought an entry level home was out of reach.

Statewide, the median price of a single family home has dropped in price by some 16.5% during the past year. Although, not nearly that dramatic in South Shore, or for Lake Tahoe real estate in general, there have been price declines which now allow qualification for home ownership to many that may have been excluded before.

.To read the full story, click here.


30 YEAR MORTGAGE RATES CONTINUE DOWNWARD TREND


No Drastic Changes Experienced This Week

McLean, VA – Freddie Mac (3/27/08) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.85 percent with an average 0.4 point for the week ending March 27, 2008, down from last week when it averaged 5.87 percent. Last year at this time, the 30-year FRM averaged 6.16 percent.

"Long-term mortgage rates were mixed, but relatively unchanged in the past week as the latest economic indicators came in much as expected," said Frank Nothaft, Freddie Mac vice president and chief economist. "For instance, the index of leading indicators continued to fall for the fifth straight month while consumer confidence reached a 5-year low.

"On the housing front, house prices keep declining across the nation. The S&P/Case-Shiller Home Price Index® was the most recent to document the drop in prices, reporting a decline of 2.3 percent from December to January in its 10-City Composite Index and a cumulative decline of 11.4 percent from January a year ago. Lower prices improve affordability and the National Association of Realtors reported that its home affordability index was at the highest level in nearly five years, contributing to a pickup in existing home sales in February."

Full Story from Freddie Mac


IMPROVEMENT IN MORTGAGE MARKET BODES WELL FOR HOUSING IN 2008


WASHINGTON, October 10, 2007 - Conditions in the mortgage market are improving for consumers, which should help to release some pent-up demand in early 2008, according to the latest forecast by the National Association of Realtors®.

Lawrence Yun, NAR senior economist, notes that widening credit availability will help turn around home sales. “Conforming loans are abundantly available at historically favorable mortgage rates. Pricing has steadily improved on jumbo mortgages since the August credit crunch, and FHA loans are replacing subprime mortgages,” he said.

Yun said it’s important to place the current housing market in perspective, and that 2007 will be the fifth highest year on record for existing-home sales. “Although sales are off from an unsustainable peak in 2005, there is a historically high level of home sales taking place this year – a lot of people are, in fact, buying homes,” he said. “One out of 16 American households is buying a home this year. The speculative excesses have been removed from the market and home sales are returning to fundamentally healthy levels, while prices remain near record highs, reflecting favorable mortgage rates and positive job gains.”

Full Story from N.A.R

 
C.A.R. REPORTS SALES DECREASE, AND MEDIAN HOME PRICE DROP

LOS ANGELES (Feb. 25) – Home sales decreased 29.8 percent in January in California compared with the same period a year ago, while the median price of an existing home fell 21.9 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

“This most recent decrease in the median price is yet another result of the liquidity crunch, which has choked off sales in recent months for nearly half of California’s housing market," said C.A.R. President William E. Brown. "Sales do appear to be edging up, but recent declines in the median price have been due to a lack of sales in the over $500,000 range, where funds are extremely scarce and jumbo loan rates are at near-record margins compared to conforming loan rates.”

Closed escrow sales of existing, single-family detached homes in California totaled 313,580 in January at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity decreased 29.8 percent from the 446,820 sales pace recorded in January 2007.

More on this story


Source: California Association of Realtors®

 


FEDERAL RESERVE BOARD LOWERS RATES BY 3/4 PERCENT

Release Date: March 18, 2008

The Federal Open Market Committee decided today to lower its target for the federal funds rate 75 basis points to 2-1/4 percent.

Recent information indicates that the outlook for economic activity has weakened further. Growth in consumer spending has slowed and labor markets have softened. Financial markets remain under considerable stress, and the tightening of credit conditions and the deepening of the housing contraction are likely to weigh on economic growth over the next few quarters.

Inflation has been elevated, and some indicators of inflation expectations have risen. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization. Still, uncertainty about the inflation outlook has increased. It will be necessary to continue to monitor inflation developments carefully.

Today’s policy action, combined with those taken earlier, including measures to foster market liquidity, should help to promote moderate growth over time and to mitigate the risks to economic activity. However, downside risks to growth remain. The Committee will act in a timely manner as needed to promote sustainable economic growth and price stability.


More from the Federal Reserve

(Source: Federal Reserve Board)

 
TEAM ANNOUNCEMENTS
   
Congratulations to Shannon Witt as Agent of the Month for February. Shannon, who has been with Deb Howard & Co. for nearly a year now, proves her dedication to her clients and to the profession of Real Estate on a daily basis. We all look forward to having Shannon as a co-worker for many years to come.
Shannon can be contacted through our office or her email at:
Shannon Witt
   

 

CURRENT SOUTH LAKE TAHOE MARKET STATISTICS
  No. of Listings $ Volume Average Price Median Price Average D.O.M.
Active Listings
Listings Under Contract
Listings Sold 2008
Residential Homes Sold 2008
(as of  4 / 7 / 08 )
677
59
 90
71
$391,467,126
$32,161,313
$39,678,300
$34,227,900

$578,238
$545,107
$440,870
$482,083

$449,000
$420,000 $383,750 $399,000
196
201
171
183 
 
SINGLE FAMILY HOME MEDIAN PRICE BY AREA
Al Tahoe
$ 484,000 (23)
No.Upper Truckee
$ 474,000 (20)
Bijou
$ 491,000 (30)
Sierra Tract
$ 329,500 (25)
Christmas Valley
$ 561,000 (14)
Stateline
$ 645,000  (1)
Gardner Mountain
$ 458,250 (18)
Tahoe Island Park
$ 439,000 (13)
Heavenly Valley
$ 799,000 (24)
Tahoe Keys
$ 1,115,000 (42)
Meyers
$ 448,500 (13)
Tahoe Paradise
$ 499,000 (23)
Montgomery Est.
$ 674,000 (32)
Y Area
$ 339,000 (13)
(as of  4 / 7 / 08 )

CALIFORNIA ASSOCIATION OF REALTORS MARKET STATISTICS
Calif. Median Home Price

Calif. Highest Median Price by C.A.R. Region

Calif. Lowest Median Price by C.A.R. Region

(as of  4 / 2 / 08 )
Source: California Association of Realtors
Feb. 2008

Feb. 2008

Feb. 2008


$$409,240

Santa Barbara $1,295,000

High Desert $220,380
 
MORTGAGE RATE UPDATE
Mortgage Rates as of 4 / 3 / 2008
(Western U.S. Average)

(Source: Freddie Mac)
30 Year Fixed
15 Year Fixed
1 Year Adj.
5.88 %
5.38 %
5.25 %
Fees & Points:  0.5 %
Fees & Points:  0.5 %
Fees & Points:  0.4 %
 
COMPARISON STATISTICS FOR THE SOUTH LAKE TAHOE REAL ESTATE MARKET
  Median Sales Price
This Month Last Year
Percent Increase
Residential Sales -
Feb. 2008
$435,750
$474,250
-8.1%
Residential Sales -
Feb. 2007
$474,250 $485,000 -2.2%
STAOR Methodology used. Multi-Year Statistics Here.
 
  No. of Listings
$ Volume
Average
Price
Median
Price
Average
D.O.M.
Residential Sales -
Q1 2008
66
$31,840,400
$482,430 $402,500 173
Residential Sales -
Q1 2007
76 $42,891,900 $564,367 $482,500 176

page revised on 4 / 7 / 08
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