Quarterly Case-Shiller Index Report

Each quarter the Case-Shiller Index measures changes in the prices of single-family, detached residences using the repeat-sales method, which compares the sale prices of the same properties over time. The graph above shows how Portland (red) reached the peak of the market in the first quarter of 2008. It also shows that after being level for the last quarter of 2009 and first quarter of 2010, prices have dropped for the second quarter, which just ended.

Home Sales Are Up, Interest Rates Are Down

Sounds like an economic recovery, doesn't it? Today the breaking news from NAR is that existing home sales in April rose 7.6% from March. That is homes that closed, not just that went pending, and included single family homes, townhouses, and condos. Due to the economic crisis in Greece and the instability of the national and international markets, interest rates also have fallen. Against all predictions of economists, Realtors, and mortgage brokers rates fell to well under 5%. This creates a perfect storm for the real estate market- the rates are low, inventory is still moderate to high, and sellers know that it's now or never if they want to unload their property. To read the articles from NAR, click here. 

Sales are Way Up from This Time Last Year!

The news is good for the monthly Market Action Report from RMLS. Comparing April 2010 with April 2009, closed sales increased 49.1%.  Pending sales also jumped 60.8%, and new listings rose 23.8%. Prices are still going down, so far the average sale price for April 2010 decreased 3.1% compared to April 2009, while the median sale price went down 4%. This is much less than the national average. Prices should go down even farther this summer, since the April numbers reflect the tax credits for first time and moving buyers. I expect sales to go up in May, but down in June and July.

Economists Predictions on Housing Market

At the National Association of Realtors® Midyear Legislative Meetings & Expo today two top economists gave their real estate market predictions. Lawrence Yun and Mark Zandi both put jobs at the center of the housing recovery, and said that the Fed will keep mortgage rates historically low for the near future, but differed on how foreclosures would affect the market recovery. Yun predicted that distressed properties (foreclosures and short sales) will make up 30-40% of the market for the remainder of 2010. Also he said that prices will stabilize this year, with a potential for 2-3% growth, and that will prevent more foreclosures and short sales from adding to the distressed properties over the next few years. Zandi has the opposite idea- foreclosures will rise until 2011, and home prices will drop farther this year. 
Read more here.

Insure Whether You Rent or Own

I always learn something when reading the Mint.com blog, and today is no different. Here's what they had to say about homeowners and renters insurance:

"Homeowners Insurance: What’s Covered
A home will likely be the biggest purchase in your lifetime and while having homeowners insurance in place is required of most buyers, making sure you have the right policy is equally important. It not only covers the structure of your home, but will also protect you if someone gets hurt or there’s damage to another person’s property.  Also covered is the additional cost of living elsewhere if your home becomes uninhabitable, as are any medical expenses for others accidentally injured in your home or on the sidewalk outside it. (Medical Payments coverage doesn’t cover your or family members living in the home if they get hurt.)  Keep in mind, flood insurance isn’t included in most policies and would result in an additional cost to the homeowner — unless you purchase separate coverage.  
Rental Insurance: What’s Covered
For renters there are two types of insurance: the HO-4 for apartment renters and HO-6 for condo renters. Both cover damages from fire, lightning, windstorms, explosions, civil unrest, as well as damage caused by vehicles, smoke, vandalism, theft, pipes bursting and other damage from faulty appliances. Renters insurance also includes liability coverage in case someone gets hurt in your apartment. Living expenses if your place becomes uninhabitable are also covered. But like homeowners insurance, you’ll need a separate policy for floods and earthquakes if you live in an area prone to those events."
What they don't say is that it's much easier to get homeowners insurance if you have previously had renters insurance. When I was renting it was only an additional $10 a month, and that covered all of our electronics, as well as jewelry and furniture. 
Read the rest of the article here.

NAR is a Lobby

I hadn't really thought of the National Association of Realtors as a lobby before, but then I was reading a news release from NAR about all the things they are pushing Congress to do. I pay dues to be a member, and I generally support most of their ideas, like the $8000 tax credit, but I also feel like I have no say. It's not like a union where I get to vote on local representatives, they get appointed and hired by the higher ups. Here's what NAR is pushing for now:

"Big Push on Capitol Hill for Real Estate Reforms
REALTORS® are asking Congress to strengthen the Federal Housing Administration, extend the FHA's high-cost loan limits, and get flood and disaster insurance reforms passed as part of their push on Capitol Hill this week during NAR 2010 Midyear Legislative Meetings & Trade Expo.

Several thousand REALTORS® are in town and will be meeting with members of Congress over two days this week. Here's a look at some of REALTORS®' top legislative priorities:

Support for small business. REALTORS® would like the government to help small businesses get much-needed financing by allowing federal credit unions to loan a higher percentage of their assets than they can now. The increase is needed to help offset the difficulty small businesses are facing in getting loans from banks.

Stronger commercial market. Extending the Term Asset-Backed Securities Loan Facility (TALF) will help improve commercial mortgage market liquidity and push Congress to act quickly on reauthorizing funds for the popular Rural Housing Service (RHS) Sec. 502 loan guarantee program, which is on the verge of running out of money.

Various FHA reforms. Legislation to strengthen the FHA would allow the agency to increase its annual mortgage insurance premium, which borrowers can fold into the loan amount. FHA Commissioner David Stevens has said that once the agency has that authority, it’ll be able to reduce its upfront mortgage insurance premium, which it raised several months ago to meet congressionally mandated reserve requirements. The upfront premium hurts borrowers more because it has to be paid in full at closing.

The FHA legislation would also give the agency more tools for enforcing rules against bad lenders. The legislation has passed the House Financial Services Committee. NAR’s goal is to put the bill on fast-track passage in the House, then get it introduced and passed in the Senate as soon as possible.

NAR is also seeking to make the FHA’s high-cost loan limits permanent. The limits, now at $729,750, expire in the fall. If the limits aren’t extended, they would drop to about $417,000, too low to make the FHA a viable financing option in many larger metropolitan areas like Boston, San Francisco, Washington, and New York.

Flood and disaster insurance. The reforms NAR is seeking of the national flood insurance and disaster insurance programs aim to strengthen private insurers’ role in handling most disasters, reserving federal involvement as a backstop. REALTORS® will be asking their members of Congress to pass the legislation in the House before Memorial Day. Then attention would turn to the Senate.

Helping the commercial securities market recover. The commercial mortgage-backed securities (CMBS) market, which for years has been the principal means for getting financing into commercial markets, is starting to come back. Yet new CMBS issues remain only a fraction of the volume that’s needed to meet demand. NAR is calling on the government to extend its TALF program to the end of the year so investors will have low-cost loans available to them to invest in commercial securities at a time when a lot of uncertainty remains about the strength of the market.

Preventing bad amendments. The big focus of Congress now is financial services reform. The bill is huge in scope but only a part of it directly concerns real estate. REALTORS® have been successful in defeating draconian amendments, including one that would have required all borrowers to put down a minimum 5 percent. Supporters of that amendment and other tough measures that could hurt housing, including a defeated amendment that would have ended federal control of secondary mortgage market companies Fannie Mae and Freddie Mac in the near future, are expected to be introduced again at different junctures of the legislative process, so REALTORS® will be sharing with their members of Congress the danger the requirements would pose to the market now.

Careful treatment of Fannie and Freddie. NAR’s position on Fannie Mae and Freddie Mac reform is that it must be taken up separately, next year, and must be undertaken carefully. REALTORS® oppose ending federal control before a structure is in place to ensure the availability of mortgage financing in the market, in good times and bad, which is the role the two companies are playing today."
All sounds pretty good right? I'm going to keep a closer eye on what the national and regional Realtor Associations are doing. 

Irvington Nominated to the National Register of Historic Places

                                                                                                                      Jon Jensen for Renovation Style
This historic and beautiful neighborhood in NE Portland has finished the long and complex application for the National Register, and is the largest area in Oregon and one of the largest areas nationwide to do so. Red tape will be added to purchasing, remodeling or building in the neighborhood, but that will also preserve it's charm and beauty. Read more here.

NAR Reports Portland Prices are Still Falling

This goes along with my own analysis of the Portland real estate market. NAR's Realtor Magazine reported today on 10 markets where prices are still falling:

Atlantic City/Hammonton, N.J.

Provo, Utah
Portland, Vancouver, Ore.
Glen Falls, N.Y.
Bellingham, Wash.
Flagstaff, Ariz.
Charleston/Sommerfield, S.C.
Eugene/Springfield, Ore.
Salisbury, Md.
Salt Lake City, Utah

Eugene/Springfield also made the list, with Bellingham WA rounding it out for the Northwest.