Foreclosures list prices and sales pulled down the average home sales price in Grand Rapids, Michigan in September, based on data from the Grand Rapids Association of Realtors.
The average home sales price in Grand Rapids this September dropped by 6 percent from September last year to $109,191.
The drop in home prices contributed to the increase in house sales in September in the area, pushing up sales by a record 37 percent and marking the eighth time monthly sales surpassed corresponding monthly sales in 2008.
Greg Carlson, head of the realtor association, said the increase in home sales and the corresponding drop in housing inventory indicate a positive development in Grand Rapids. But he said he is still cautious because of uncertainties in many factors affecting the market.
He cited the adverse impact of the expiration of the $8,000 federal tax credit for first time home buyers in November, which has been contributing to the increase in home sales.
He also mentioned the temporary effects of the 90-day foreclosure moratorium implemented by the state in July. He contended that the moratorium may be only delaying the entry of distressed homes into foreclosures list.
According to Carlson, there were about 1,100 foreclosure properties available for sale at any one time in the past months, but after the foreclosure moratorium was implemented, there were only about 500 foreclosure homes on the market. After the end of the moratorium, Carlson speculated about the return of large numbers of foreclosures to the market.
Other realtors however are convinced that the bottom of the housing market in Grand Rapids has been reached. They said that the list of properties priced under $20,000 in the past months numbered about 200 and occupied three pages at any one time, but now, they said, these types of low-priced properties occupy only three-fourths of a page.
Nationwide, several indicators also have been showing signs of the start of housing market recovery. In August, construction spending climbed up unexpectedly by a record rate — the sharpest rise in the housing construction sector in almost 16 years.
In August, home price declines nationwide also slowed, as shown in the Standard & Poor’s/Case-Shiller Home Price Index that monitors home price movements in 20 major U.S. cities.
In addition, the National Association of Realtors also reported an increase in pending home sales in August for the seventh consecutive month, including pending sales from foreclosures list inventories.
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