Housing rebound: When to spot one

Home-buyer grants increased to $15K
from The Arizona Republic, reports that if first-time buyers buy a foreclosed home in Peoria, the city's Down Payment Assistance Program awards qualified buyers a $10,000 grant, which increases to $15,000 for a foreclosure purchase. William Patena, city neighborhood-services manager said, "This is an incentive to buy a foreclosed home in Peoria. When you give an extra $5,000 for a down payment, it helps people who may not otherwise afford a home." According to city officials, Peoria showed 1,397 homes in the foreclosure process. Patena encouraged first-time buyers and those who have not owned a home in the past three years to apply for the grant. A newly formed city task force charged with dealing with vacant, foreclosed homes recommended increasing the down-payment grants.

Housing rebound: When to spot one
from CNNMoney.com, reports that real estate is a local game and your region could be doing better than the country as a whole. According to the National Association of Realtors, median prices for existing single-family homes in a third of the country's metro areas are actually higher than they were a year ago. NAR president Richard Gaylord said just as cities moved independently on the way up, they're not moving in lockstep on the way down. That's why "it's more important than ever to examine what's happening in your city." One indicator that a turnaround in your market is near is changes in your local job market. The more new jobs created, the greater the demand for homes. Conversely, an increase in unemployment, or a persistently weak labor market, can let you know a recovery may still be far away. Mike Larson, a real estate analyst with Weiss Research said the best signposts to look for are a significant reduction in the supply of homes and a jump in sales.

The Return of the First-time Buyer
“The key player in any recovery scenario is the first time buyer… When they purchase existing homes… [they] allow sellers to move up to bigger houses… Today, newbies are coming back. Why? For the first time in years, entry-level homes are affordable. Builders have slashed prices, and [on] far smaller [homes] than the McMansions of the boom... KB Home’s average selling price dropped to $248,000 in its February quarter, versus $267,000 a year earlier. In 2006, KB’s basic model in Victorville, Cal. [was] 3,800-sf and sold for $328,000. Today, its stripped down offering goes for $220,000, at less than half the size.” (Joel’s Real Estate News, July 16th)

Home Buyers Hopeful About Market
from Realtor Magazine Online, reports that according to an online survey of potential home buyers, 44% believe the real estate market will improve once the new president takes office. The survey also found that 81% say they remain nervous about the current market. A variety of barriers to buying a home were cited by survey respondents: 28% say they are stymied by the cost of a down payment; 20% are concerned about their income level, and 31% (39% in the West) say home prices are still too high. Also, 78% of the potential home buyers who responded say they are willing to save or earn extra money for the down payment and are willing to compromise on amenities in their new home to make it more affordable.