Tony and Libby Kelly, CRS, ABR, ePro, SRES, CLHMS, CNHS

It looks as thought the housing market maybe turning around. Home prices posted their first quarterly increase in three years. The Standard & Poor's/Case-Shiller's U.S. National Home Price Index released Tuesday rose nearly 3 percent from the first quarter.

Home prices are about the same level as early 2003. While this is much lower than the peak in 2006, those numbers were inflated anyway.

Las Vegas and Detroit were the only two of the 20 city index that did not see home prices rise, while Dallas and Denver clocked their fourth-straight monthly increase.

We still have a long way to go to recover completely because all 20 cities still show annual declines, but it is nice to take a step in the right direction.

http://www.oregonlive.com/business/index.ssf/2009/08/index_shows_quarterly_increase.html

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Homes have not been this affordable in nearly two decades. In the second quarter of this year the typical American family, making the nation's median income of $64,000 a year, could afford to buy 72.3% of all homes sold in the United States. The same time last year it was only 55% of homes. This affordability, combined with the federal tax credit and historically low mortgage rates, is drawing in the first-time buyers.

Affordable specifically means a family making the metro area's median income who devote no more than 28% of their take-home pay toward housing costs.

The reason for this affordability is that home values have dropped. 30% of all homes sold during the second quarter went for less than what the sellers originally paid. This was mostly the newer home owners who had bought in the last five years when prices were rising rapidly.

So although home owners have watched the value of their investment plummet, the silver lining is affordable housing. Affordable housing means interested buyers. Interested buyers means an economic recovery.

http://money.cnn.com/2009/08/19/real_estate/most_affordable_housing_markets/index.htm?postversion=2009081914

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July Residential Highlights

Closed sales in the Portland metro area for July 2009 eclipsed last July’s total by 8.6%, marking the first time same month closed sales have increased since April 2007. Pending sales also grew 8.3%. New listings dropped 25.4%. Comparing July 2009 with June 2009, closed sales increased 11.9% (1,988 v. 1,776) and pending sales were up a slight 0.3% (2,170 v. 2,164). New listings fell 8.2% (3,907 v. 4,257). Inventory was down to 7.3 months, dropping for the sixth consecutive month, down from 10 months last July. Inventory is falling at a time where it has historically risen. Along with an upswing in closed sales, the drop can be attributed to the fact that the number of homes on the market (14,503 in July) has seen little fluctuation in 2009

Year-to-Date

Comparing January-July 2009 with the same period in 2008, closed sales are down 18.7% and pending sales decreased 10%. New listings dropped 23.4%.

Sale Prices

The average sale price for July 2009 was down 15.2% compared to July 2008, while the median sale price declined 13.3%. Month-to-month, the average and median sale price were mixed when compared with June levels; the average sale price was down 3.7%

($288,600 v. $299,800) and the median sale price was up 0.04% ($250,000 v. $249,900).

A new study by the Pew Research Center has found that those who call the suburbs home are noticeably more satisfied with their community than those of cities, small towns or rural areas.

The study shows that 42 percent of suburbanites give their community high marks. The categories include cost of living, a place to raise kids, recreational/outdoor activities, climate, shopping, cultural activities and social connections.

31 percent of Americans live in a city, 26 percent in the suburbs, 26 percent in small towns and 16 percent in rural areas. Oddly, 30 percent say they would prefer to live in a small town versus 25 percent who favor the suburbs.

It sounds like some people have idealized small town life when in reality they tend to be more satisfied just outside the city. Which makes sense to me because most of the time the suburbs are the best of both worlds.

The Residential Specialist Magazine July/August 2009 Page 6

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This website, http://www.walkscore.com/, is a great resourse for researching a neighborhood. Not only will it help you get a feeling for the type of area you are looking at but it will also help you find restaurants, grocery stores, parks and entertainment that are located near you.

There is also this great ranking feature that shows you which neighborhoods in your city are the most walkable.

http://www.walkscore.com/rankings/Portland

PLEASE CHECK OUT OUR WEBSITE http//:www.TonyandLibby.com & OUR NEW PORTLAND METRO BLOG AT http//:www.TonyandLibby.blogspot.com & pdxrealtynews.com (make sure you leave comments)