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Greetings!
We are often asked if the housing market can truly rebound if the all-round economy remains sluggish. Thinking about this, the answer might be that the housing market is not dependent on the economy but rather the economy is reliant on the housing market. According to Mark Zandi, Chief Economist at Moodys, in a recent report:
"Historically, housing has always led the U.S. out of recessions. It is the most interest rate-sensitive part of the economy, and as rates fall during recessions, housing rises first."
The real estate market, however, is badly misunderstood. Everyone in healthy market thinks the economy will surge immediately. Yet, it's a big county. Nationally, sales in March of existing homes actually slid slightly, and sales of new ones are consistently below forecast. The usually reliable FHFA has home prices up 7% year-over-year, and that overstatement is testimony to everyone's struggle to measure prices during the transition from high levels of distressed sales to a more "normal" level.
MGIC, the mortgage insurer, just released its April report of 73 metro areas. The results: 15 are weak; 26 are soft; and 32 stable. None are reported as strong - and only 26 are reported as improving (moving to another category). For those who like details, the complete report is available here: MGIC Market Trend Report.
Not surprisingly, no cities from Maine are referenced in the report. Yet based on our experience so far this year, it is hard not to feel like the greater Portland area would fit into the category of stable - and improving.
In Cumberland County sales of single family homes through April 30th are up 9.1% versus the first four months of 2012. The median price is up 4.7%. Statewide, sales and prices are up 7.3% and 3.3% respectively.
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Moving to the Burbs Is the Age of Sprawl Ending?
Are we choosing to live close to our goods and services rather than having the big boxes move to us?
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Editor's Note
Thank you for your continued support. As with everything we do, we constantly strive to set a standard of professionalism uncommon in our industry.
We would love to hear your comments and suggestions as to what you would like to read in the weeks and months ahead. Email us anytime at: Info@MaineHomeConnecction.com. Or visit our Facebook page for current updates and market trends. If you are thinking of buying or selling - or know of someone who is, it would be our privilege to assist them.
Sincerely,
Laura & Michael Sosnowski
Maine Home Connection
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Spotlight on South Portland
Market Update
Often overlooked, the city of South Portland is the second largest real estate market in southern Maine.
In 2012 single family home sales were up 15% versus 2011. The median price also improved significantly, increasing 9%. The city has much to offer homebuyers, including excellent schools, easy access to the ocean and close proximity to the Portland business district.
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Fannie Mae 2012 Results
Record Profits Reported!
Just four years ago, the government had to step in and take control of Fannie Mae, which was brought down to its knees by deep losses from foreclosures and plunging home prices after the real estate bubble had burst. This month Mortgage financing giant Fannie Mae reported a record profit of $17.2 billion for 2012, a testament to how much the housing market has improved lately.
It was the first full year profit reported by the company since 2006, and marked a significant turnaround from the $16.9 billion loss it posted for 2011. It also means that Fannie Mae is poised to pay tens of billions of dollars in additional dividends to the U.S. Treasury, perhaps as soon as this quarter, in what could turn out to be its largest repayment to date. The government has pumped in $116 billion in bailout funds in its rescue of the company. |
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