Home sales slow as list­ings soar

Record 11,749 on mar­ket; cau­tious op­ti­mism hinges on re­cov­er­ing jobs scene

Austin American-Statesman - - BUSINESS & PERSONAL FINANCE - By Shonda No­vak

Cen­tral Texas’ hous­ing mar­ket slowed in June, with sales down 4 per­cent from a year ago and the num­ber of homes on the mar­ket climb­ing to a record 11,749 list­ings, the Austin Board of Real­tors re­ported Tues­day.

The list­ings were up 16 per­cent from a year ago, even as the num­ber of sales in the pipe­line to close in July dropped 23 per­cent, to 1,610.

Sales of new and ex­ist­ing homes na­tion­wide have slowed with the ex­pi­ra­tion of a fed­eral tax credit for buy­ers. Al­though mort­gage rates re­main be­low 5 per­cent, many real es­tate ex­perts ques­tion whether home sales can main­tain mo­men­tum with­out the tax cred­its.

“No mys­tery — just like any­thing in sales. Run a spe­cial one month on re­frig­er­a­tors, cars, mat­tresses or houses, take the spe­cial off, and the next month sales of that same item are slow,” said Robin Curle, an agent with JB Good­win Real­tors. “Why? You made two months of sales in the last month of the spe­cial. And some folks were wait­ing to see if the ‘spe­cial’ would come back.”

Curle said she is op­ti­mistic about the mar­ket, given the re­gion’s im­prov­ing jobs pic­ture.

Charles Heim­sath, an Austin real es­tate con­sul­tant, said that al­though he is not concerned about the mar­ket even-

tu­ally re­gain­ing strength, he doesn’t think “we’re out of the woods yet.”

“Pend­ing sales are the most im­por­tant lead­ing in­di­ca­tor, and with pend­ing sales off by 23 per­cent, I am concerned about main­tain­ing sales mo­men­tum into the fall months,” said Heim­sath, pres­i­dent of Capi­tol Mar­ket Re­search.

In ad­di­tion, the surge in the num­ber of homes in the mar­ket raises the pos­si­bil­ity of homes tak­ing longer to sell, Heim­sath said. List­ings are up partly be­cause buy­ers “are less will­ing to sell at a dis­count” and are hold­ing firm on prices.

John Hor­ton, chair­man of the real es­tate board, said the slight dip in sales last month from a year ear­lier “shows there is life for Austin real es­tate af­ter tax cred­its.”

He noted that it took an av­er­age of 70 days to sell a house, a num­ber that has fallen for six months in a row.

The me­dian sales price last month rose 4 per­cent, to $208,750.

De­spite the sales de­cline, the to­tal dol­lar vol­ume of real es­tate sold — nearly $554 mil­lion — in­creased 6 per­cent from a year ago, mainly be­cause of in­creased de­mand for prop­er­ties in higher price ranges, Hor­ton said.

“The fed­eral tax cred­its were most suc­cess­ful in get­ting first­time home­buy­ers into the real es­tate mar­ket, with most pur­chas­ing ‘en­try-level’ homes,” Hor­ton said. “This helped ex­ist­ing home­own­ers pur­chase ‘move up’ homes, which in turn helped spur ac­tiv­ity in higher price ranges.”

Curle said with ex­perts pro­ject­ing that the re­gion will gain 9,700 new jobs this year and 17,100 in 2011, “the one fac­tor that is slow­ing us is the un­cer­tainty go­ing on in Washington.”

“They are cre­at­ing so many new agen­cies and pro­grams — busi­ness is hav­ing a hard time fig­ur­ing out how much all of this is go­ing to cost,” she said. “Hard to ex­pand when you don’t know what all the new rules are — and the costs.”

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