Nick Libert

Today's report from CNN showing a record drop in home prices and signs of a market bottom and potential stabilization highlight NOW being the time to buy. It's a perfect storm of low interest rates, record price drops,the 8k tax rebate (only good through the end of November!) and the economy finally settling down into a potential recovery due to the stimulus package and stock market improving. CHICAGO AREA PRICES dropped 20.7%, highlighting the huge discounts and values available. Message me for details!

(CNNMoney.com) -- Median home prices fell a record 15.6% during the three months ended June 30, compared to the same period in 2008, according to an industry report.

There is good news though: The survey from the National Association of Realtors reported the median home price rose 4% compared to the first quarter of 2009 -- to $174,100 from $167,300.

The increase in median price was not a surprise, representing, as it did, the traditionally strong spring selling season. But the jump did offer the prospect that the worst of the price declines may be behind us.

"With low interest rates, lower home prices and a first-time buyer tax credit, we've been seeing healthy increases in home sales, which are a hopeful sign for the economy," said Lawrence Yun, NAR's chief economist..

In the vast majority of metro areas -- 129 out of 155 -- median prices dropped year-over-year. Some of the decline can be traced to an increase in the percentage of foreclosures and short sales. They accounted for 36% of all transactions during the quarter.

These "distressed properties" are usually sold at discounts of at least 15% compared with traditional sales.

Patrick Newport, a real estate analyst for IHS Global Insight, while admitting the year-over-year results are still awful, said recent evidence indicates that prices are stabilizing.

"The state sales data show sales picking up across the country," he said.

Newport expects prices and sales to trend down again, especially when the impact of the first-time homebuyers tax credit starts to fade. The credit ends December 1. "Afterward, sales will take a hit," he said.

His forecast is for prices to drop another 5% this year, driven down by added inventory as the foreclosure plague continues to worsen.

Cheapest and priciest areas

The Cape Coral metro area in Florida recorded the largest decline: 52.8% to $84,000. Davenport, Iowa, had the biggest gain: 30.6% to $113,200.

The lowest priced market in the nation is now Saginaw, Mich., where the median home sold for $55,700 during the quarter, a 30.6% drop over last year. The most expensive market was Honolulu, with a median price of $569,500 -- although that's still a 10.5% discount from a year ago. San Jose, Calif. led all mainland cities at $500,000 but that was still down a whopping 33.8% from a year ago.

Condo market

Condo prices have taken an even more severe beating. They fell 19.8% year-over-year, but rose 3.6% quarter-over-quarter.

If you're in the market for a condo in Las Vegas, you may never find a better time. Prices dropped 54.1% compared with the second quarter of 2008 and fell 11.7% between the first and second quarters of 2009. The median price now stands at a bargain basement $66,400.

Condo prices rose year-over-year in only four of 61 metro areas surveyed by NAR. The biggest gain was in Virginia Beach, where prices went up 2.8%. Wichita, Kan. (2%), Dallas (0.7%) and Colorado Springs (0.2%) were the only other gainers.

The most expensive condo market was San Francisco, where the median price was $405,700, down 22.5% from a year ago. Las Vegas was the cheapest condo market by far, with Reno a distant second at $103,100.

WOW! Exciting news from the State of Illinois and the new HOME START program. I'm very excited to hear about this special TAX REBATE ANTICIPATION LOAN for buyers who qualify for the 8k Federal Tax Rebate. Read below for more information and CALL/TEXT/EMAIL ME for more details, questions on how this works, or to start your home search!

Purpose/General Description

The Illinois HOME START Loan Program is designed to help first time homebuyers achieve the dream of homeownership affordably. The HOME START program offers homebuyers two loans: the HOME START 30 Year Fixed Rate Loan and an optional HOME START Tax Credit Advance Loan.

HOME START 30 Year Fixed Rate Loan

As the name suggests, the first loan under the HOME START program is a 30 year fixed rate amortizing loan insured by the Federal Housing Administration (FHA) and serviced by U.S. Bank Home Mortgage. As of July 17, 2009, the interest rate is 6 percent and is subject to change in market conditions.

Homebuyers have the option to utilize the HOME START 30 Year Fixed Rate Loan in conjunction with the HOME START Tax Credit Advance Loan, or use the first mortgage on its own.

HOME START Tax Credit Advance Loan

The second loan under the HOME START program is the HOME START Tax Credit Advance Loan which allows Illinois first time homebuyers in need of down payment assistance to access funds on a short-term basis in anticipation of the federal income tax credit for first time homebuyers.

The American Recovery and Reinvestment Act (ARRA) of 2009 provides eligible first time homebuyers with a one-time tax credit of up to $8,000 that will enable them to save on their federal tax bill. Only homebuyers who are purchasing a home before November 30, 2009 are eligible for the tax credit. (See this PDF file for more details about the federal homebuyer tax credit).

The HOME START Tax Credit Advance Loan helps first time homebuyers take advantage of the $8,000 federal tax credit refund in advance to use as a down payment on their first home. However, the maximum loan amount under the HOME START Tax Credit Advance Loan program is $6,000 or 3.5 percent of the purchase price, whichever is greater.

Within the initial period, the homebuyer will file their tax return requesting the federal tax credit. This tax credit can be used to repay the tax advance loan. If the loan is not repaid by June 30, 2010, then the remaining loan amount becomes a ten year amortizing loan at 0.5% above the rate on the Home Start 30 Year Fixed Rate Loan.

Please also see this PDF file for Program Requirements.

Seeing as interest rates are starting to rise off their historic lows (but are still reasonable) and home prices have begun to slow their free fall we saw in the winter and spring, this is a crucial time to potentially cash in on great market conditions before the pendulum swings the other way. Remember to be safe you need to be under contract by October 15th to close by December 1st (30-45 days is a standard time for FHA and other mortgage contingencies) for the $8000 tax rebate.

HERES THE KEY TO BUY WHILE INTEREST RATES ARE STILL LOW!

Assuming a $200,000 loan (numbers rounded to the nearest whole dollar), check out what you lose by waiting and gambling on interest rates not creeping up:

INTEREST RATE MONTHLY PAYMENT ANNUAL COST FOR 1% INCREASE 30 YR COST

6-7% $1199 $1578 $47,340

7-8% $1331 $1643 $49,280

8-9% $1468 $1692 $50,760

Every month you wait you risk interest rates going up--they've already creeped up nearly a percent (or more) since this spring. GET YOUR TAX REBATE--TAKE ADVANTAGE OF HISTORIC PRICE DROPS--INTEREST RATES ARE STILL LOW!

Email me to learn more about getting in now while it's still an exceptional buyers market.

Join Tami Bonnell, President of the US Organization of EXIT Realty Corp. International as she addresses the past, present and future of the real estate industry in a public webinar to be held on Tuesday, April 28, 2009. Learn effective business practices, along with questions every real estate professional should be asking and able to answer in today's ever-changing economic climate.

The same session will be presented twice, live, at 3:00 p.m and 6:00 p.m. CentraT. This event is open to the public and geared towards real estate professionals across North America. Please go to www.exitrealty.com and select the time of your choice. Registration is limited so register early!

Ms Bonnell will answer questions at the end of the webinar. Tami's real estate career spans more than 25 years during which she was instrumental in building three major brands. Ms Bonnell has been featured several times in major industry publications, including Real Estate Magazine, Bay State REALTOR and Frog Pond Communications. She is a much sought-after international speaker, addressing thousands at events such as RISMedia's Leadership Conference in NY, Inman News Conference in San Francisco and the Top 500 Power Brokers at The National Association of REALTORS Convention. Since becoming President of the US Organization for EXIT Realty Corp. International, her focus is on growth and profitability for Regions, Brokers and Agents.

Please email me for any questions or details, or to learn more about Exit Realty!