VOL. 125 | NO. 132 | Friday, July 9, 2010
Home Sales Increase 22 Percent in June
By Eric Smith
The homebuyers tax credit finally paid dividends for the local housing market, which just closed the books on its best month in two years.
Shelby County saw 1,570 home sales in June, a 22 percent increase from 1,290 sales in June 2009 and also a 22 percent increase from 1,289 sales in May, according to real estate information company Chandler Reports, www.chandlerreports.com.
That marked the highest sales total since June 2008 when the county notched 1,623 home sales.
Home sales averaged $133,428 in June, up 6 percent from $125,809 in June 2009 and up 4 percent from $128,713 in May. Also, last month’s total sales volume of $209.5 million was 29 percent better than $162.3 million in June 2009 and 26 percent better than $165.9 million in May.
The improvement comes at a time when the residential real estate industry needed it the most. The homebuyers tax credit, which doled out up to $8,000 for qualified buyers, required contracts to be signed April 30.
Though it had expired, and though contracts initially needed to close by June 30, President Obama last week extended the closing date to Sept. 30, giving a reprieve to real estate agents scrambling to finalize their deals.
Before that happened, the outlook was bleak. Nationwide concerns over the expiration of the homebuyers tax credit sent new home sales tumbling in May – and sent shockwaves up Wall Street.
Sales of new homes had fallen 31 percent locally and 33 percent nationally as potential homebuyers scurried from the market once the homebuyers tax credit expired. That nosedive caused analysts to portend a housing market “double dip” – sales showing a significant decline for the second time since the recession began.
The 33 percent national dropoff took new home sales to the lowest level on record, according to an Associated Press report.
But the June report provides some temporary relief from abysmal new home sales during recent months – at least locally because national numbers weren’t yet available.
Shelby County saw 131 new home sales in June, a staggering 70 percent increase from 77 new home sales in June 2009 and an even better 77 percent increase from 69 new home sales in May.
Another positive trend emerged from last month’s numbers: the percentage of bank, or foreclosure, sales decreased in comparison with the overall total.
June’s 469 bank sales comprised 29.1 percent of the market, while June 2009’s 480 bank sales comprised 37.2 percent of the market.
For more about the state of the housing market – including sale, mortgage and permit activity – look for The Daily News’ quarterly reports beginning Monday in print and at The Daily News Online, www.memphisdailynews.com.
The quarterly reports, which run Monday through July 20, also include the latest data on foreclosures, bankruptcies, law and the courts, and small business licenses.
Chandler Reports is a division of The Daily News Publishing Co. Inc.