Things on the American Homefront seem to be getting better. A key Home Price Index rose much more than expected in July, and for the third month in a row. JR Sangiuliano, a realtor in central New Jersey is on the frontlines of the middle class housing markets and says he's seen a comeback firsthand after a dismal first quarter.
Every month since then, April, May, June, July, it has come back to the point where if you compare the first eight months of 2008 to the first eight months of 2009, the total number of homes closed is only off by about five percent.
While he's been seeing improvement though, he warns clients to still keep their expectations low. That includes Joan Gallagher. She is getting tips on how best to present her house, listing price on the Rahway New Jersey Cape Cod style home, 349,000 dollars. And she is prepared to wait for a buyer.
We know the homes start moving quick. So we thought we might as well put it on the market now, because I think, seeing the neighborhood, it's taking a while for the homes to sell.
Sangiuliano says prices in this middle income neighborhood which tend to sell in the mid-3,000-dollar range are off by as much as 100,000 dollars from their peak. But the good news for sellers like Gallagher is that buyers are motivated these days by the low mortgage rates and those very low prices, a catch buyers can take their time and shop around leaving sellers on a holding pattern even if they do drop their prices.
That's what we're getting from all of our realtors. They like this house, but they want to see what else is out there. They fall in love with this house, but they want to see what is out there. So they want to make sure they are not missing out on a better deal.
One other care that could help sellers like Gallagher, an 8,000-dollar government tax credit for first time home buyers. The credit has sparked new life in the housing market cripples by the Subprime Mortgage mass and recession. But that credit is set to expire on November 30th. Just as auto sales fell when the summer's Cash for Clunkers Program ended, some realtors fear a drop in sales if the 8,000-dollar tax credit is not extended by Congress.
Bobbi Rebell, Reuters, New York.
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