Eureka Real Estate expert, DEAN KESSLER of THE KESSLER REAL ESTATE TEAM reports that in the past month home sales in the greater Eureka area remained consistent.

 

Kessler notes “It’s unfortunate to have to report a dramatic increase in the number of “bank owned” home sales in the past month. It simply means a prior home owner went thru the pain of foreclosure rather than pursue the many other available options to foreclosure.

 

Kessler went onto say “The pain of foreclosure severely degrades property values of all homes in our community. For example, last month a “bank owned” 3bed/2bath home in Myrtletown sold for $233,600. Previously a comparable “resale” home in the neighborhood sold for $257,500, a difference of $23,900. This difference now reduces property values by $23,900 of all comparable homes. Reason being, appraisers have to use the “bank owned” home sale in their valuation assessment of future home sales. Let’s take it to another level. Using the same “bank owned” home sale, let’s say there are 200 comparable homes in the greater Eureka area. The County’s tax base was just reduced $4,780,000 as a result of this one “bank owned” home sale. Keep in mind, there were 5 other “bank owned” home sales that had occurred last month. If my example “bank owned” home sale was the average sales price (and it was), the County’s tax base was reduced by almost 29 million dollars as a result of the six “bank owned” home sales last month”.

 

The chart below shows real estate activity for the Eureka area as compared to the same time last year.

 

 

April 2009

% Change

April 2008

Active Listings

240

-22%

310

Sales

28

-12%

32

Short Sales

0

-12%

0

Bank Owned Sales

6

-

1

Average Sales Price

$264,311

-14%

$308,600

Time Supply of Inventory (months)

8.6

-11%

9.7

 

 

Kessler reflected on April’s real estate statistics by saying “The average sales price of a single family home in Eureka increased 8% to $264,311 from March’s average of $241,922. This increase appears to be an anomaly attributed to a couple of large dollar home sales last month. Most of the home sale activity is occurring below the $250,000 price point.”

 

A quick look at the least and most expensive homes sold in the Eureka area include a $169,900 3bed/1bath home “Bank Owned” sale in West Eureka and a $570,000 3bed/2.5bath “Resale” home in the Humboldt Hill area.

 

So who were these buyers that are keeping our real estate market active? The top 3 sales groups of Home Buyers last month included:

 

· 43% were 1st time homebuyers

· 14% were move-up buyers

· 14% were buyers relocating to the area

 

For the fifth successive month, 1st time homebuyers continued to be the largest group of buyers in our real estate market. With the availability of really low interest rates and accompanying low home prices, 1st time home buyers are listening to the advice of  Buy now, it’s simply too great of an opportunity to pass up.  The $8,000 tax rebate being offered by the government just about covers the complete down payment needed for an FHA loan. And the FHA loan is the most popular loan product used by 1st time homebuyers. And the news keeps getting better. Factor in an additional $10,000 tax rebate being offered for purchasing a newly constructed home and one can see how1st time home buyer’s are realizing a smart home purchase now, and a sizeable income tax return in 2009/2010.

 

Dean Kessler is the Broker/Owner of RMK Realty, Inc and Seller Specialist for The Kessler Real Estate Team. He holds the Realtor®, Accredited Buyers Representative (ABR), Certified Distressed Property Expert (CDPE), and Certified Residential Specialist (CRS) designations.

 

All statistics courtesy Humboldt Multiple Listing Service.