Thursday, December 17, 2009
November home sales boosted by tax credit
Still, foreclosure activity in the Roanoke area was up 520 percent from November 2008
The latest from The Ticker blog
First-time homebuyers in the hunt for a federal tax credit boosted home sales by more than 50 percent in the Roanoke Valley in November. Still, foreclosure filings climbed above year-ago levels.
Sales of Roanoke-area homes rose 57 percent in November, compared with the same month in 2008, according to the Roanoke Valley Association of Realtors. Last month, 333 housing contracts closed, up from 212 in 2008.
While the sales increase is good news, it's also relative, considering that last November registered the lowest month for sales in all of 2008. "The economy was in a lot of turmoil," said Ed Smith, a broker with ReMax Valley Realtors in Roanoke County.
The average price of a home dropped to $185,008 from $196,286 in November 2008, according to the association. Area real estate brokers attributed this decrease to the typical home price that first-time buyers seek, which is $110,000 to $150,000. The number of first-time homebuyers likely pulled down last month's average home price, Smith said.
Before Congress extended the deadline, first-time homebuyers had to close on a home by Dec. 1 to receive an $8,000 tax credit. This deadline forced a flurry of sales activity from September through November at Realstar Realtors, said Bob Johnson, owner and principal broker at the Roanoke County firm.
Last month, Congress extended the credit's deadline, giving first-time homebuyers until April 30 to purchase a home and still be eligible for $8,000. Additionally, current homeowners can buy a home through April 30 and receive a tax credit of up to $6,500.
For now, the recent buying rush has subsided at Realstar.
"You're seeing sales pretty flat," Johnson said.
Despite an increase in home sales, a continued rise in foreclosure filings across parts of Southwest Virginia indicates that many homeowners are in economic distress.
In November, there were fewer foreclosure filings in the Roanoke Metropolitan Statistical Area compared with October, but foreclosure activity was up 520 percent from November 2008, according to RealtyTrac, which tracks foreclosures nationwide.
Last month, foreclosure filings topped 93 in the Roanoke MSA, up from 15 in November 2008. There were 140 foreclosure filings in October, according to RealtyTrac
There were 23 foreclosure notices last month for the Blacksburg, Christiansburg, Radford MSA, up significantly from only four in November 2008. Still, the number was down from 27 filings in October.
Virginia had 4,590 filings last month, which is lower than many other states, such as Florida, which had 52,935 filings, according to RealtyTrac.
Even so, though foreclosure activity may be lower in Southwest Virginia compared with other cities, "for our economy, it's still a huge hit," Johnson said.
