Today the New York Times reports that new home sales (that's new construction) have made their largest monthly gain in 8 years--up 11% in June.  Still, that's 21% lower than June '08.  These are national statistics.  In the Midwest, the paper reports new home sales are up 6% from one year ago.

Good news? Well...like most statistics, it depends on the spin!  Even in a 'down' market, most sales happen in the first six months of the year.  From July-December, sales slide.  And remember that 'sales' means a closed transaction--average time from contract to close is about 45-60 days. So most of these new home sales contracts were inked months ago.

Here's what's happening in my zip code of 64113--a very desirable area of Kansas City MO, full of older homes ranging in price from a fixer-upper below $200K up to nearly $1million:

From 7/1/07-6/30/08 there were 272 sales in this zip code, 133 homes sold at $299K or less. 

From 7/1/08-7/24/09, there were 228 sales, 161 homes sold at $299K or less.

It's good news that homes are selling because that reduces inventory, keeps prices stable, the market will balance out...eventually.  Another interesting fact is that in a normal year, 33% of home buyers are first time buyers; so far in 2009 that figure is 55%.  That is certainly true in my sales this year--many first timers, most sales under $250,000.  The market for $300-$400K homes  is much softer, at least in this zip code.  And if you are selling in that price range, the home better be HGTV Designed to Sell perfect. Buyers are VERY picky these days, want to see EVERYTHING in their price range, feel no urgency to buy (unless there is a specific deadline) and want to be sure they are getting 'a deal'. 

The Natl Association of Realtors is pushing to extend the $8000 tax credit beyond the current November 30 deadline and would like to see ALL home buyers eligible, not just first time buyers.  NAR predicts that if the tax credit/refund was extended, this could spur an extra 700,000 home sales next year.  Don't expect this extension, however.  President Obama is all about his 'health care coverage for all' getting passed first above all else.  Also, if the extension would happen it would have to be deficit neutral-- paying for itself by cutting somewhere else.

Parting words:  Sellers: know  your competition.  Chances are you will have to still compete on price for several more months.Make your house look like a 'good deal' for the price.  Outshine the competition with price and / or decor.    Buyers:  I predict there will be a rush of first time buyers in Aug, Sept and Oct who want to take advantage of the $8K tax credit.  Get out there and start looking NOW in the area you are interested in. Be READY to sign when you see something you like at the price you want..  As we get closer to that Nov 30 deadline--inventory for the first time buyer price range (generally $200K or  less) will shrink.

Need  sales statistics for your neighborhood? Email me and I"ll be happy to send you info!