Rockford Area Realtors (RAR) sold 318 homes in July, 27.2 percent higher than a year ago, when 250 homes were sold in July 2010. This marks the third month this year in which monthly sales were higher than the same month in the previous year, with two year-over-year increases in the last two months.
The three-month average rolling price in July of $102,761 was down 2.8 percent from $105,766 in June, and down 14.5 percent from $120,136 in July 2010.
“It’s encouraging to see some continued momentum in the market with sales at levels higher than the past 13 months, driven by high affordability conditions and pent-up demand,” said Steve Bois, CEO of RAR.
Bois said some of the increase is attributed to the decline that took place when the withdrawal of the housing credit in July 2010 resulted in a drop in housing sales, yet area Realtors are seeing increased buyer activity.
Realtors are reporting high interest levels among a variety of homebuyer segments, this buyer activity confirmed by traffic to the RAR website. Last month, 11,898 unique users visited the site to search for open houses, up 11.6 percent from 10,662 unique users in June, and the largest single month of visitors since the site launched in February 2008.
“The housing market has seemed poised for some modest rebound for a number of months — foreclosure activity is slightly down, interest rates are very low, and the variety of properties for sale is extensive,” Bois said.
He said challenges remain for a return to a normalized market, and top among them relate directly to the economy.
“Consumers were unimpressed by the ability of the federal government to come to a timely agreement on the deficit and raising the debt ceiling, further diverting attention from the major issue of regenerating the U.S. economy,” Bois said.
Bois said a fourth-straight month of high sales pending indicates strong sales likely to continue in August, some of that driven by a motivation to take advantage of historically low mortgage interest rates. But Bois warns that interest rates may be soon rising.
“As the government starts to leave the mortgage market and private industry steps in, banks will demand a higher rate of return on their investments,” Bois said. “Several economic sources have said that 30-year mortgage rates could increase perhaps as much as 1 to 2 percent.”
From the Aug. 17-23, 2011, issue