Local bankers and real-estate agents say the uptick in the housing market has been modest, attributing increases to the first-time homebuyer tax credit being offered through November, the depressing effect foreclosures have had on prices and refinancing of existing loans into lower rates.
Nationally, home sales are growing at their fastest rate in more than eight years after stalling out in the middle of 2008. New-home sales for June were up 11 percent from May.
"It's not coming back as fast as we would like, but it's been a modest increase," Zanesville-area Realtor Jay Butler said. "The phone ringing is better than not having it ringing."
Buyers are starting to take advantage of a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers. Home sales must be completed before Dec. 1 for buyers to take advantage.
Jeff McLendon, of McLendon Mortgage in Zanesville, said the availability of the tax credit has been a good thing and about 60 percent of the loans his firm has done have been eligible for the credit.
"When that came out, our phones were ringing off the hook. The first thing people were asking is, 'Do I qualify for this?'" McLendon said. "Then they want to know if they can close before the tax credit is up. It's the busiest we've been in four years."
Carl Raines, vice president and local branch manager with Peoples Bank in Zanesville, said one-year comparisons between spring 2008 and the same time period this year show that mortgage financing has doubled in the area.
But a lot of the growth he sees is in residential home refinances, he said.
"We're up in the region, in southeast Ohio. We're losing adjustable rates to people refinancing into fixed rates," Raines said. "But we exceeded our loan goals in February, March, April and May."
He said construction home loans are picking up, which has increased the sales of construction materials.
Raines attributes some of that to the tax credit for first-time homebuyers.
The rate of home repossessions through foreclosures remains high in Muskingum and surrounding counties, but that's also had a positive effect on housing prices for the consumer.
"It's lowered prices significantly, I would say 15 to 20 percent," Butler said. "We have people who are ready and qualified to buy a home, but banks were tight for a good stretch there. The first-time money has helped some. But you've got to have a credit score of 620 or better for a lender to look at you. It comes down to lending ability."
Tom Lyall, president and CEO of Century National Bank in Zanesville, said Century had record lending volume through the first half of 2009, mainly via refinancing.
"But the last couple of months, we've seen a pretty nice increase in home purchases," Lyall said. "Overall volume has been terrific, and the tax credit has taken the strain off of budgets for some people."
But some would like to see more help.
"If the purchaser could get their hands on that credit at the time of sale, it would be so much better," McLendon said. "That money could be used for the down payment or to fix up the home, whatever. If you get the credit after you buy the home, how did that help you buy your home?"
No comments:
Post a Comment