The month of July in Somerset County, New Jersey, saw a slight downturn over June numbers.  The absorption rate increased from 7.2 months to 7.8 months, and the supply/demand ratio dropped very slightly from 57% in June (the best yet this year) to 54% in July.  A year ago the absorption rate was 6.7, about a month shorter than this year, but the supply/demand ratio was the same - 54%.

The market is still recovering from August 2007 when everything hit the fan, but it is recovering.  The closed sales number for July 2008 was 362, and in July 2007 372, or off a little less than 3%.

The number of properties available on August 1 was 2544 this year, 2536 last, and 2599 in 2006.  Not much difference, but the number of sales made this year in July was 327, last year 380, and 334 in 2006.  These are not closed sales, but ones that were written in those months. 

The market in Somerset County overall favors buyers, but there are many communities in which the balance has tipped in favor of sellers.  Watch this space....

Some critics of the new housing bill have opined that it is a "giveaway" to first time home buyers.  Not exactly.  It is an interest-free loan for 15 years.

Here's what I mean.  Individuals who qualify for the $7500 tax credit (or 10% of purchase price, whichever is lower) will repay the amount over 15 years at $500 per year (if the maximum) amount.  By the way, if the buyers' tax liability is less than the amount of credit, they will receive a check from the IRS for the balance.

If the buyers sell the home before the fifteen years is up, the balance of the interest-free loan is due and payable to the IRS.  Even though the buyers are paying back 1/15 of the loan per year, if history is any indicator, those payments will be in dollars of less value than the original loan.  Still not a bad deal.

The market is changing in every area, especially in those areas where change was most needed.  Ask a local Realtor® for help in determining how you can benefit.

By a vote of 72-13 the U.S. Senate passed the housing bill earlier passed by the House of Representatives.  There are a number of provisions in the bill, all of which will help the real estate market in those areas where conditions are the worst.

But even in New Jersey, where the market's decline has not approached the abysmal levels of California, et al., there is a provision that should certainly stimulate activity.  First-time home buyers who close(d) on a home between April 9, 2008 and July 1, 2009, will be eligible for a tax credit of up to $7500.  That's a tax credit, not a deduction.

The difference is that if you have a total tax liability (what you owe the IRS) of, say, $10,000, and you have bought a home in the date range of the bill, your tax liability (what you pay the IRS) can be as little as $2500.  That's huge.

This bill - to be signed by the President next week - will pull buyers off the sidelines, and will strengthen the real estate market significantly.  Other provisions will contribute to this strengthening.  Expect the market to change.