Home Buyer Interest is Steady – July and August Activity Will Reveal the True Tale

Through the first half of 2010, the median price of homes sold in Thurston County was down 5.3% from the same period last year. At $229,950, the median price is back at 2005/6 levels.

We have mentioned all year long that these prices have led to more buyers getting back into the market. Home sales so far in 2010 are up 12.5% over the first half of 2009.

Over the past two months, however, the market has seen far fewer buyers than during the same period in 2009. The expiration of the tax credit explains the drop off. Buyers who were in the market no doubt accelerated their home purchase to take advantage of the credit. This pulled sales that might have occurred in May and June forward to March and April.

Because the original tax credit had to be put to use prior the end of June, the sales in July and August will really tell how well the market is performing. These are the first months without the tax credit. (But see related post on May 15, 2010 entitled Tax Credit Extended for Qualified Uniformed Service Members.)

A rise in sales in July and August will give more promising signs that price reductions have come to stabilizing levels. If sales are down, the market should expect further price reductions to compel buyer activity.

Whether buying or selling, those people in the market should watch more than just the market as a whole. It is important to compare each home to its specific market segment to determine how it should be priced.

What is clear right now is that many houses, in all price ranges, are priced very well. Buyers continue to act quickly on these homes while ignoring homes priced above today’s conditions.