While some homebuyers have been complacent in taking their time to find a home to buy in Massachusetts, I recently noticed a trend of more and more homes quickly going under agreement. This has been occurring with more frequency as home sales have unexpectedly surged.
Sales had been expected to fall this season; however they have, jumped 5.1 percent to an annual rate of 4.72 million as of last month. Here in the Northeast, sales rose 15.6% to an annualized rate of 740,000 units and are down 14.9% from a year ago
Nationally, the increase in sales has been the largest increase since July 2003.
The inventory of homes on the market is now approximately a 9.7 month supply which is still well below the 11.2 month supply in November.
Although existing home sales remain at lows that have not been seen in more than a decade, economists have been buoyed by recent housing news which has helped to fuel the stock market this week.
One of the factors that may be driving the escalation in sales is the record number of foreclosure properties which have encouraged bargain hunters to enter the market looking for their dream deals. The discounts on foreclosure properties have also caused the regular housing inventory to lower its prices inducing an even deeper buyers' market.
Record low mortgage rates have also been a motivating factor. Interest rates on 30-year fixed-rate mortgages have remained below 5% this week, falling to the lowest level since mid-January and skimming all-time lows, according to a survey by Freddie Mac.
The latest report comes at the same time as the government has announced its plan to buy more than $1 trillion in assets - a move that is intended to drive rates on mortgages down further.
Interest rates on mortgages hit an all-time low of 4.96% in January and have continued that trend, enticing homeowners to refinance and home buyers to enter the market. In the wake of the Fed's announcement this week, rates are expected to fall even further. These lower rates along with declining home prices are presenting more opportunities to home buyers.
As entry-level buyers seek out bargains, move-up buyers are also searching for opportunities that may not come again soon.
Copyright 2009 - Claudette Millette, President, TheBuyersCounsel - 800-392-1446, E-mail Ashland, Holliston, Hopkinton, Natick, Newton, Northborough, Framingham, Sherborn, Southborough, Sudbury, Wayland, Westborough
