Recent Trends in the Real Estate Market

Many of us out there are considering refinancing our home loans right now and are wondering what to do next. I asked this question to an experienced loan officer during this week's Home Buyer Radio Show. Listen has Curt explains the"IN's and OUT's" of refinancing your home loan. Enjoy the show.

Listen as Adam Iobst of A-Team Realty, LLC interviews Crey Riel of Bank of America Home Loans and addresses the in's and out's of the FHA rule changes. This is important Information for Home Buyers that are considering financing their next home purchase with an FHA loan. The rules are much different and may impact your financing options. This is a three part radio show. This is part one of three.

Absorption Rate

The absorption rate increased to 18% last month in our area. It is still a strong buyers market in the DC Metro area. We are starting this year with fewer properties for sale, compared to 2008 and 2009.  The absorption rate was also lower in 2008 and 2009 (closer to 11%).  These are all indications that the real estate market in our area is strengthening. I believe that we may experience balanced market conditions in some areas this year!

Days On Market

It currently takes about three months to sell a property in our area. It took less time to sell a property in January 2010 than it did in January 2008 and January 2009!

Number of Sales

The number of sales decreased last month; however, the number of sales is higher this January than it was in January 2008 and January 2009! I expect to see the number of sales increase until the fall of 2010.

Sale Prices

We are very close to the average prices we experienced in January 2009. It appears that the increase we experienced late 2009 was only temporary. The increase may have been caused by the First Time Home Buyer Tax Credit that was scheduled to expire in November 2009. I believe that prices will increase like they did last year until the Fall of 2010.

Adam Iobst

This week we are interviewing Curt Hall of First Home Mortgage. Listen as Curt and Adam discuss the new Home Buyer Tax Credit. This is an informal and informative interview. Enjoy the show.

Absorption Rate

The absorption rate has remained flat since April of this year. From April to August the absorption rate averaged 18.5%. We experienced higher absorption rates during the Spring/Summer of 2009 than we had in the past three Spring/Summers (2006, 2007, and 2008). This is an early indication that the local real estate marketing is moving towards a balanced market. I expect to see demand actually pick up as more buyers try to purchase properties before the end of the year to take advantage of the tax credit. There will continue to be increase in inventory too, so we’ll have to see if this increase in inventory offsets the increase in demand and keeps the absorption rates in the 16% - 18% range.

Days on Market

The average time to sell a home dipped slightly again last month (1%). It still takes about three months to sell a property in the current market. I expect to see an increase in the in the days on market due to the anticipated number of short sale (pre-foreclosure) homes sold this year. These transactions may take months to close and therefore may increase the overall average days to sale homes for the area.

Sales Price

The average sales prices in the region remained about same last month (.36% decrease).

Arlington County ($537,120; 2.63% increase)

Fairfax County ($449,086; .28% increase)

Baltimore County ($273,214; 2.11% decrease)

Montgomery County ($456,860; .52% decrease)

Prince Georges County ($231,549; .78% increase)

Washington D.C. ($466,336; 3.55% decrease)

I expect to see property values to remain relatively flat for the entire 2009 year!

Number of Sales

The number of sales decreased last month (about 11.1%). Although the number of sales in our area has decreased recently, we are selling more homes on average every month compared to the monthly averages last year. I now expect to see the number of sales slow, but remain relatively high for the fall/winter seasons.

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This week we are interviewing Brad Cohen of Mason Dixon Funding, Inc. Listen to Brad explain the recent trends in the mortgage industry and how to best prepare for your next home purchase. This is an informal and informative interview.

Enjoy the show.

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