The Pending Home Sales Index in the South rose 8.5 percent to 93.2 in March and is 7.7 percent above a year ago. In the West the index increased 3.9 percent to 93.1 and is 1.7 percent higher than March 2008. The index in the Northeast fell 5.7 percent to 59.5 in March and is 24.1 percent below a year ago. In the Midwest the index slipped 1.0 percent to 82.3 but is 8.2 percent higher than March 2008.

The National Association of Realtors Pending Home Sales Index, based on contracts signed in March, rose 3.2 percent to 84.6. February’s pending home sales index was slightly revised down to 82.0 from 82.1. Compared to the same period a year ago, pending home sales rose 1.1 percent.

First-time homebuyers looking for bargains snapped up about half of all homes sold last month. Much of this is attributed to first-time buyers taking advantage of favorable affordability conditions, including an $8,000 tax credit.

“Homes are more affordable than they’ve been in years and mortgage rates are near record lows”, said Lawrence Yun, the National Association of Realtors chief economist. “We need several months of sustained growth to demonstrate a recovery in housing, which is necessary for the overall economy to turn around,” said Yun.

The median sales price in March was $175,200, higher than February’s median price of $168,200.

According to a report by the National Associations of Realtors (NAR) on Feb 12, 2009, the median price of single-family home resale in 88 percent of the United States’ metropolitan areas trended down in the fourth quarter 2008 from a year earlier. 45 percent of the transactions in this quarter were distressed sales, foreclosures and short sales, which lead to the decline in the median price. The most significant price drop occurred in Florida, Michigan, California and Arizona.

Nationally, the median price for single-family homes dropped 12.4percent year-over-year in the fourth quarter. Regionally, the median home prices dropped 25.1 percent in the West, 10.6 percent in the Midwest and 7.5 percent in the South and 4.7percent in the Northeast.

NAR President Charles McMillian pointed out “distressed home sales have risen from about 38 percent of transactions in the third quarter, meaning people are responding to discounted prices and are slowly absorbing the excess inventory. Buyers clearly see value in today’s pricing.”

Lawrence Yun, NAR chief economist reported the largest gain in sales volume for the fourth quarter was in Nevada, up 133.7 percent, followed by California, rose 84.7 percent, Arizona, up 42.6 percent and Florida with a 12.5 percent increase.  This is a clear pattern that strong sales gain in lower price homes occurs in areas with extreme price declines resulting from foreclosures.

In the condo sector, the strongest condo price increases in this quarter were in the Dallas – Fort Worth – Arlington in Texas, up 14.1 percent, followed by Toledo, Ohio, up 11.4 percent compared to fourth quarter in 2007.

Yun noted despite the market being clearly depressed by job losses and consumer concerns about the economy, the much anticipated housing provisions in the economic stimulus package may spur some buying interest for the critical spring home buying season.

A survey by Pew Research Center’s Social and Demographic Trends project in October 2008 shows Denver, San Diego and Seattle as the top three cities most respondents would like to live. Orlando Florida, Tampa Florida ties for fourth place with San Francisco California. Detroit, Cleveland and Cincinnati at the bottom of the ranking.

Major findings include:

• Ideal community type:

            30% small town

            25% suburb

            23% city

            21% rural area

• Young adults would rather live in New York and Los Angeles        
• More men than women want to live in Las Vegas, Nevada
• Republicans prefer Phoenix, Arizona
• Democrats would rather live in San Francisco, California
• Seven of the top ten favorite cities are in the West and the other three are in the South     
• More than 60% of Americans prefer to live in a hot-weather over a cold-weather climate
• Almost half of those surveyed would rather live in a different community than there current home.
• 60 % rate their current communities as excellent or very good.       

Americans may not be buying homes, but international buyers are finding the U.S. housing market an enticing place to invest their money.

International buyers are driven to the US real estate market by bargains and currency rate advantages. Additionally, as 30 percent of these buyers tend to buy with cash, the mortgage credit crunch is not a worry for them.

Florida, California, Arizona, and Texas are the top destinations for international real estate buyers according to a National Association of Realtors (NAR) survey.

NAR Chief Economist Lawrence Yun says, “the real estate sold to foreign buyers in Texas tends to be modest-priced homes … More than 60 percent of the homes purchased … are priced under $200,000.”

Releasing the full findings from its 2008 National Association of Realtors (NAR) Profile of International Home Buying Activity, Canadian in particular are taking advantage of the current soft U.S. real estate market by buying vacation property or second homes. Percentage of Canadian buyers doubled from last year, from 11 percent to 23.5 percent - now the biggest foreign buyer market in the U.S.

The NAR report also finds that “64.4% of Canada buyers plan to use their U.S. homes for vacation purposes. On average, foreign purchasers plan to stay in their U.S. property 2.6 months of the year. A third intend to use the U.S. home a total of 3 to 6 months”.  Condominiums were popular among foreign buyers from Canada: nearly half of all properties purchased by Canadian buyers were condominium/apartments.

Foreign exchange rates have helped keep US homes more affordable, the value of the U.S. dollar as compared to foreign - especially Canadian and European currencies has dropped over the last several years. The effect net when combined with lower U.S. home prices, means that the true cost for a U.S. property is actually less in foreign monetary terms than in previous years.

Although it is still seen as a healthy number of international buyers entering the market to supplement the declining domestic sector, the faltering markets in the UK and Europe have had an impact on the amount buying in the US this year – predicted to be far higher then current figures would suggest.

Of the 4,000 US-based agents surveyed between May 2007 – May 2008, some 26 percent served international clients in the past year and nearly half of those clients ended up purchasing a home. The primary reasons some clients did not eventually buy a house were home price concerns, immigration laws, and property taxes. “If visa regulations that favor longer stays for overseas buyers such as retirees from abroad were in place, these sales levels would be even higher,” said Tony Macaluso, 2008 chair of NAR’s international business group.

“Many international buyers recognize that real estate is an excellent investment and are drawn today by abundant inventory, low interest rates and a softer dollar. These conditions allow them to own their own a piece of the American dream,” said NAR President Richard Gaylord.

Foreign buying trends in USA
May 2007 – May 2008: Source NAR
- 150,000 – 190,000 properties sold to international buyers
- Florida, California Texas. Arizona, New York, Washington, Nevada – most popular locations
- 14% of foreign bought property cost over $750,000
- Average foreign purchase cost $297,000
- 40% of buyers paid in cash
- Canada, UK, Mexico, China, India and Germany most active buyer markets
- Percentage of Canadian buyers doubled from last year, from 11% to 23.5% - now the biggest foreign buyer market in the US.
Source: NAR