Weekly Market Report 9-26-08

This report pertains to residential homes on less than 10 acres sold from Sept 12 to Sept 25th as reported by the Lebanon Board of Realtors MLS.

Over the last 2 weeks there were 12 homes sold for a total of 2.1 million. The average price of these homes was almost 176 thousand with the median price at 105K; these homes had an average time on the market of 122 days. There are currently 10 homes listed as under contract in the Lebanon MLS and those homes have an average price of 100,000.

Year to date there have been 199 homes sold, that's down from last years 247 during the same time frame, the average price is 114 thousand dollars, which is barely down from 07's 115.5K; the YTD volume of 22.8 million is under last years 28.5 million. Our average time on the market this year has been 140 days, that's almost the same as last years 141 day average.

As of this morning there were 391 homes with less than 10 acres, listed with the Lebanon MLS compared to 350 last year in the same week. The average asking price is 149k with median asking price of just about 124; these homes have an average time on the market of 138 days.

Once again the US economy has been the hot topic in the news, and over shadowing everything has been, what is referred to as the "700 billion dollar government bailout". One of the largest mortgage holder in the country, Washington mutual, was scooped up today by giant JP Morgan Chase and it wasn't even headline news. I have heard lots of comments about the bail out over the last few days, from community members, from colleges, and even this morning from the National Association of Realtors, and it seems to me that there is very little understanding about what this bailout is and what it would mean. There seems to be a perception that the government is going to hand out 700 billion dollars of taxpayer money and get nothing of monetary value in return. I am not an economic expert but I do know this, the bail out is not a charity, regardless of all the details congress is still working out, the bail out is meant to actually purchase assets. These assets are projected to be purchased at around 29 cents on the dollar and over the long run should be liquidated at a profit. To put this into perspective lets just say that John Doe loaned Jane Smith 100,000 to buy a house and after a while Jane wasn't paying john, so then john couldn't pay his bills or loan anyone else money. So along comes Uncle Sam and says hey john, I'll give you 29,000, and when Jane pays up or sells her house that money is mine, actually sounds like a decent deal for Uncle Sam even if the house is only worth 60,000. In the end the money should come back with interest. The intent is to free up struggling lenders capitol so that they can again loan money to business owners, and home buyers in turn re-stimulating the economy. I don't necessarily think all this is a good idea, but I do understand how it's supposed to work; in the end I believe we live in country where capitalism will always rule and economic balance is a matter of going through the cycles.