Property bargain hunters contributed to the slight fall-off in the housing price index for September, with discounted deals accounting for much of the overall increase in transactions nationwide. The minimal monthly decline suggests a delay in the usual end-of-summer slowdown, and the recent tax credit extension may turn out to be merely a temporary market fix. For more on this, see the following article from HousingWire.
National home prices fell 0.6% from August to September in Integrated Asset Services’ (IAS) monthly house price index.
It’s a relatively small decline, IAS said, compared to 2008’s shift from August to September of 3.1%. The default management and residential collateral valuation analytics service provider said the results indicate the decline in prices that traditionally occurs as the summer months wind down was delayed this year.
However, the national results are somewhat skewed, as substantial price increases in large concentrated areas of California offset declines in other regions of the country, IAS said.
The West region experienced a 1.1% increase compared to declines in the Northeast (3.1%), Midwest (2.1%) and the South (1.2%).
“The number of transactions is generally up in all geographic areas,” said IAS president and CEO Dave McCarthy. “It’s very interesting that activity is more pronounced in areas with declining prices. This indicates to me that there is some bargain hunting going on.”
The September results were also impacted by a belief in September that the first-time homebuyer tax credit would end at its previously scheduled Nov. 30 expiration. Now that the credit is extended, it could continue to impact sales, McCarthy said.
“Along with extensions in unemployment benefits, the tax credit could prop up the market for a time,” McCarthy said. “But in my opinion the government’s intervention will ultimately delay a final recovery.”
The IAS index is a measure of non-conforming, bank owned, and conventional sales transactions as well as those insured by the Federal Housing Administration (FHA) and the Veterans Administration (VA).
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