Home sales rebound from 13 percent decrease in 2009
Peoria home values remain strong as home sales recover from the end of tax credit surge
According to the Peoria Area Association of Realtors® (PAAR), home sales in 2010 were down by only 4.4 percent compared to the double-digit slump of 13 percent in 2009. The sales activity for 2010 was attributed to the homebuyers tax incentive, which ended on April 30; historically low interest rates that dipped below 4.0 percent; and the favorable affordability index of homes in the Tri-County area. Home prices continued to be positive as the average sale price of homes showed a slight gain for the year and the median sale price stayed the same as last year.
“Buyers who took advantage of the tax credit incentive dominated the first half of 2010, but it was the unbelievably low interest rates and affordable housing that kept the market motivated through the end of the year.” said PAAR President Michael Maloof. “This year was definitely a challenging year, but as we move forward, we anticipate good things to happen in the spring with the release of the pent-up demand from buyers wanting to get into the market or move up.”
Home Sales – Total home sales for 2010 were 4,295 compared to 4,492 in 2009, a decrease of 4.4 percent or 197 homes.
In Illinois, home sales were down 3.8 percent from 2009. According to the National Association of Realtors, home sales fell to the lowest level in 13-years to 4.8 percent in 2010. High unemployment and a record number of foreclosures were a majority of the blame for the decrease in home sales nationally.
Home Prices – The average sale price for homes in the Peoria area was $137,213 for 2010 compared to last year’s average sale price of $134,300, an increase of 2.2 percent. This can largely be attributed to a higher number of properties sold in the higher priced ranges, compared to 2009.
The number for the median sale price was $114,000 for 2010 compared to $114,550 in 2009, a decrease of 0.5 percent. In Illinois, the median sale price for 2010 was $152,000, down 3.2 percent from $157,000 in 2009. Nationally, the median home price for December was $168,800, down 1.0 percent from December 2009. The median is a typical market price where half the homes sold for more, half sold for less.
Inventory – The number of homes on the market in the Peoria area at the end of the year was 2,560 compared to 2,446 in 2009, an increase of 4.4 percent.
Currently, there is a 7.2 months supply of inventory on the market compared to 6.7 months in 2009. A market is considered balanced between buyers and sellers when there is roughly a 5-to-6 month supply of homes available for purchase.
Inventory numbers are at a level that gives a buyer a good selection of homes to choose from in most price ranges. It is also an indication that sellers are competing with more available homes, therefore in today’s market, a seller must think competitively and not emotionally. It’s more important than ever that the property outshines the competition. The home must be in “beauty contest” condition and priced to compete in today’s market. For buyers, the current inventory in the Peoria area is only slightly higher, indicating the market is still balanced in most price ranges. Some communities around the country are reporting double-digit months of inventory which is clearly a buyer’s market.
4th Quarter/December 2010. Home sales for 4th quarter were 921 compared to 1,220 homes sold for the same period last year, a decrease of 24.5 percent. Home sales in December were virtually the same compared to a year ago with 306 homes sold in 2010 compared to 303 in 2009.
Average sale price in December 2010 showed a significant increase over the previous year with the average sale price at $144,881 compared to $128,893 in 2009, an increase of 12.4 percent.
The median sale price of $116,000 remained the same for December 2010 and 2009. In Illinois, the median price in December was $140,000, down 7.9 percent from $152,000 in December 2009. The national median existing-home price for all housing types was $168,800 in December, which is 1.0 percent below December 2009.
Misc. New listings at the end of the year were up 4 percent from 2009. Total active listings were also up 4.7 percent from a year ago to 2,560 homes on the market. Market times increased by 10 percent to 97 days on market compared to 88 last year.
Interest rates are inching higher according to the latest report; dated January 27, 2011, from mortgage finance giant Freddie Mac. The report states that lenders were offering 30-year fixed-rate home loans at an average 4.80% this week to borrowers with solid credit and 20% down payments or home equity. That compared with 4.74% the previous week.