Home sales remained uneven throughout the tristate area heading into the fall, as record-low mortgage rates appeared to soften the impact of the expiring tax credit for homebuyers.
In New York, home sales rose 3.7 percent between July and August, according to the New York State Association of Realtors, but remained nearly 30 percent off their levels of a year ago. In some counties, Realtors recorded big month-over-month gains in closings ”“ in Putnam County, closings were up by better than half between July and August, while Dutchess County counted a 44 percent gain.
Only the month before, NYSAR reported that sales slowed in July after a big push by buyers to close deals by the June 30 deadline of the homebuyer tax credit authorized under the American Recovery and Reinvestment Act.
“We believe that the lower-than-typical August sales total continues to reflect the shift in sales to the first half of the year as buyers took advantage of the federal homebuyer tax credit,” Duncan MacKenzie, CEO of NYSAR, said in a prepared statement.
MacKenzie added that modest monthly home sales totals are expected for the balance of the year as both the housing market and economy continue to recover.
Sales up in Nutmeg State
In Connecticut, Fairfield County was the lone county to see home sales rise in August, according to the Boston-based Warren Group, but not enough to stave off the worst single month for home sales statewide in two decades.
While Fairfield County sales of single-family houses climbed 9 percent in August from a year earlier, home sales across Connecticut were off 15 percent. That was the lowest level in more than two decades according to the Warren Group, which publishes “The Commercial Record.”
Still, on a year-to-date basis home sales are up in Connecticut 13.6 percent from the first eight months of 2009, and in Fairfield County they are up a whopping 38 percent. Also up were pending sales in which initial terms have been set, but with the transaction still subject to negotiations between buyers and sellers.
“It”™s reasonable to assume that the tax credit got potential buyers out early in the year, sort of like the decline in auto sales after the expiration of the cash-for-clunkers program,” said Timothy Warren Jr., CEO of The Warren Group. “The increase in pending sales is certainly a hopeful sign, but it”™s important to keep in mind that last fall we had the original ”¦ tax credit that stimulated sales dramatically, especially in November; so it seems unlikely that we”™ll see good (year-over-year) statistics all the way through the whole fall.”
Tax credit aside
The New York gains were due only in part to the pending expiration of the first-time homebuyer tax credits, according to the Westchester-Putnam Multiple Listing Service, which in late October is changing its name to Empire Access Multiple Listing Service Inc.
WPMLS noted an increase in sales of homes priced at more than $1 million during the second quarter, with those deals typically involving couples not eligible for the tax credit.
“Few (Realtors) have reported that they serviced transactions that actually depended on the tax credit for viability,” WPMLS stated in its second-quarter report.
“Rather, the overwhelming message from the field is that prospective purchasers were out in force for a variety of reasons, and the tax credit served to amplify their readiness to buy and to accelerate their timing for doing so. Extraordinarily low mortgage interest rates was one of those driving factors.”
