Spared the worst of the housing market crisis, Vermont is making slow but sure progress, reporting minimal property value deflation. Once at the top of the real estate boom, areas like Hartford are now benefiting from more modest sales to first-time buyers lured by incentives, yet the spectre of increased job losses now threatens to bring foreclosures to a state that mostly eluded the scourge of toxic home loans. For more on this, see the following article from Housing Predictor.
The foreclosure epidemic hasn’t hit the Vermont housing market and it’s not projected to arrive. The big national lenders that sold the majority of problem mortgages never targeted Vermont to sell their new exotic loans, and it’s Vermont’s saving grace.
The foreclosure crisis that has slammed so many other places won’t be hurting the state.
The inventory of homes for sale is slowly decreasing as home sales rise. But the country’s most northern state in the Lower-48 is seeing the velocity of housing sales sputter along rather than make a full rebound.
At the present rate the inventory of homes listed for sale will take at least a year to sell off. There were hardly any subprime mortgages or new creative loans sold by lenders. There isn’t a foreclosure epidemic in Vermont and as a result to a large degree they’re dodging the housing crisis.
Local Vermont Housing Markets at a Glance
However, job cuts are increasing as the recessionary economy takes hold. It’s the first time in years that Vermont has had an unemployment problem, and that could lead to some foreclosures as homeowners, who lose their jobs are unable to make mortgage payments.
Home sales are getting a boost from the federal tax credit for first-time homebuyers in Burlington. Vermont’s housing market sees the highest number of sales during spring and summer months only to cool off when winter hits. Burlington will sustain one of the lowest levels of deflation in the country, and is forecast by Housing Predictor to see average home values deflate just 2.6% in 2009.
In Hartford home sales have also received a boost from the tax incentive, but only in the lower $150,000 to $250,000 price range, where most first time buyers purchase. Hartford hit record high prices during the national real estate boom only to have home prices fall close to where they were before the boom. Vacationers and second home buyers from bordering New Hampshire enjoy snow skiing in Vermont during the winter and an abundance of outdoor activities like hunting, camping and boating during the summer.
The average price of a home rose a modest 2% in 2008 in Hartford, which is projected to deflate an average of 2.8% in 2009 by Housing Predictor. Second home buyers and many new residents moved to Vermont during the boom for its high quality of life.
At the Crossroads of Vermont in Waterbury, the state’s once most active housing market has seen sales slow on expected fall out from the credit crunch as mortgages became harder and harder to get. But more applicants for home loans are being approved these days, which will act to give the market a boost in the last quarter of the year. The high-end market caters to tourists and second home buyers for the most part, and is projected to deflate an average of just 3.6% in 2009.
This article has been republished from Housing Predictor. You can also view this article at Housing Predictor, a real estate analysis and forecasting site.