Existing Home Sales Are Up Slightly
ROBERT SIEGEL, host:
There was one glimmer of good news about housing this week. Nationally, sales of existing homes picked up for the first time since July. That surprised most economists, and gave many new hope that we may be seeing the bottom of the real estate slump.
Now, before going any further, let's all repeat the old housing axiom, all real estate is local.
Unidentified Group: All real estate is local.
SIEGEL: And with that in mind, here is a story from NPR's Ted Robbins, who toured some houses with real estate agents in Tucson, Arizona, where sales are up by double digits.
TED ROBBINS: Ken Hoddack(ph) likes a loft in one of the bedrooms.
Mr. KEN HODDACK (Real Estate Agent): It gives it all kinds of extra space, and kind of a neat little niche for children.
ROBBINS: Sandra Beacher(ph) hates the location.
Ms. SANDRA BEACHER (Real Estate Agent): My big downside is this house has no view, and that is really important for people. Everybody moving out of the state, the number one item they list on the sheet I give them is view.
ROBBINS: These real estate agents are a part of a group touring homes for sale in the Tucson suburb of Marana. It's a way of networking and a way of giving feedback to the agent who has the listing - in this case, Cathy Waylan(ph). At the half million dollar asking price, the sellers of this house will probably just break even after owning it for four years. The comments from other agents will help Waylan explain that to her clients.
Ms. CATHY WAYLAN (Real Estate Agent): It helps us in talking with our sellers, and sometimes they can't grasp the whole reality of the market.
ROBBINS: The reality is that it's a buyers market. And in southern Arizona, buyers know it. Sale prices are down, but existing home sales were up last month, nearly 20 percent from January, though they're still down from a year ago. Cathy Waylan says buyers are returning but they are being really picky.
Ms. WAYLAN: Everybody's looking for a deal, and everybody thinks that there's a better deal. So, yeah, this is a great deal but I think there's probably a better one down the street next week.
ROBBINS: In fact, down the street there is a better deal. Waylan has a house listed for less than what owners paid. They've defaulted on their mortgage and the bank decided to get what it could out of the property instead of foreclosing.
Ms. WAYLAN: They're saying we'll take 300 even though the actual payoff is in the 370s. It's worth it to us to sell that house and not have it on a foreclosure inventory.
ROBBINS: Still, Waylan says she's had three contracts on the property fall through because buyers found something else they liked better. Other markets in the west - Phoenix, Las Vegas, parts of California - were far more overheated in the boom years than Tucson, and they are suffering more in the downturn, but even those areas are seeing more sales than last month.
Unidentified Woman #1: I think…
Unidentified Woman #2: It's really white because look how easy this knife(ph) goes through there.
ROBBINS: After the tour, the agents meet back at the office for a monthly potluck lunch. Given the last few years, you might expect them to be glum but they're not. They see more activity in the market now than they have for many months. Branch manager Rodney Lewis says two factors are bringing home buyers back to the market: historically low interest rates, around 6 percent for a 30-year loan, and higher limits on government-backed mortgages, which makes banks more likely to lend. Still, Lewis isn't ready to call the housing slump over.
Mr. RODNEY LEWIS (Branch Manager): I don't think you know when a market is bottomed out in any market until you're on the other side of it and the upswing is starting. I think one month is too soon to tell, but it does give you a glimpse as to what the future may bring to you.
ROBBINS: Spring is typically the time of year when sales pick up, so it really is unclear if this is a blip or a trend. It will take at least two or three more months of increasing sales before realtors here breathe easier.
Ted Robbins, NPR News, Tucson.
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