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U.S. home sales surged 11 percent in the third quarter - and 18 percent in New Jersey - as first-time home buyers seeking the $8,000 government subsidy rushed into the market, the National Association of Realtors said Tuesday.

Home prices rose 2 percent in the Atlantic, Cape May and Cumberland county area from the second quarter but remained down 10 percent from the period a year ago, the Realtor survey said. Nationwide, home prices fell 11 percent during the past year.

Home sales in New Jersey were 8 percent higher than a year ago, while U.S. sales were up 6 percent from the year before. In the Northeast, sales increased 17 percent for the quarter and 7 percent for the year.

Realtors at state, national and local levels said the increase was caused by the federal government's $8,000 first-time homebuyer tax credit, which had been set to expire at the end of November but was extended and expanded through April 30.

Lester Argus, of Argus Real Estate in Ventnor and former president of the Atlantic City & County Board of Realtors, said the tax credit "made all the difference in the world."

"I've been shocked by how many people have been calling me and asking about it," Argus said.

He said the expansion of the credit program to those who have owned a home for five years - who may qualify for a $6,500 tax credit - is a market boost that should have been done earlier.

"A lot of people have wanted to trade up and take advantage of the market," Argus said.

Jarrod C. Grasso, N.J. association executive vice president, said the jump in state sales can largely be attributed to the rush of first-time home buyers.

Grasso said the statewide housing market is heading toward stabilization, thanks to the federal housing stimulus.

Lawrence Yun, chief economist of the National Realtors, said the tax credit was a powerful catalyst that, when combined with low prices and interest rates, tipped prospective buyers into the market.

"The buying conditions this year are the most favorable on record dating back to 1970, but the tax credit is allowing buyers to set aside any reservations about waiting for a better deal," Yun said in a statement.

Home prices were lower from a year ago for 123 out of 153 metropolitan areas surveyed by the Realtors, including the Atlantic City area. A spokesperson for the N.J. Association of Realtors said Tuesday that the quarterly survey includes pricing data for Atlantic, Cape May and Cumberland counties within the Atlantic City metro area.

The third quarter median price of $223,000 in the three counties was up from $218,700 in the second quarter but still down from $248,900 a year ago.

Prices continued to be weighed down by distressed sales - short sales and foreclosures combined - which accounted for 30 percent of all sales in the third quarter, the survey said.

Grasso said each of New Jersey's eight surveyed metropolitan areas showed a price increase from the second quarter, a sign that competition in the marketplace is returning.

Contact Kevin Post:

609-272-7250

KPost@pressofac.com

1 comment:

• sinker'64 (16) posts 10:46 am

  I don't know how these real estate shills sleep at night. Oh, wait. They're sociopathic, egomaniacal,compulsive liars and, therefore, probably sleep like babies. Seriously, realtors are now using the pittance of a tax credit to lure young prospective homebuyers into financial ruin. The realtors do not care; they will grab their 6% off the top and be long gone when the house for which some young couple shelled out one-half million bucks will not sell for half that amount. The dirty little secret of the real estate industry is that there is a massive amount of "shadow inventory" out there. Your typical, overweight, NFL-obsessed, 21st Century American shlub has decided that he "just ain't payin' da mortgage." So, what's a bank to do? Foreclose and be forced effectively to admit that the house on which it loaned $500k will bring in only $199k? No way. Much better to delay doing anything about the deadbeat, carry the house on the books at its fraudulent, initial appraisal, and just HOPE that Obama,Frank,Dodd,et al. eventually come up with some scheme under which the taxpayers will pick up the deadbeat's mortgage payments. However, there will come a time in the not-too-distant future when banks will have to bite the proverbial bullet on all of their severely depreciated collateral; you really cannot "extend and pretend" forever. When that time comes, then look out below. One parting thought: If it really is, as Lawrence Yun claims, the best time since the 1970's to buy a house, then why in the world should the taxpayers have to bribe prospective homeowners to buy? Seems to me they would be climbing over one another's backs to buy, in typical mindless American fashion, if now really were the best possible time to buy in two generations!

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