This is not to say that the bad news in housing, particularly for retirement communities, is over. But there have been some rays of good news popping up here and there. Thank goodness, we are tired of writing about the same old bad news!
First off, the Census Bureau reports that sales of new homes increased 2.7% in September, coming off the worst sales in 17 years. Inventory of unsold new homes declined 30,000 from their record levels of 404,000 units. Lower prices coming from distressed sales are the major reason for this improvement. The median price of a new home is now $218,400 – down from $240,000 in September, 2007.
One month doesn’t make a trend, but there is good news in other corners too. In Las Vegas NV and Prince William County, Virginia, sales are up. In California several markets improved – Sacramento sales increased 135% over September 2007. In parts of southern California September sales were up 65% or even higher. Again, the reason for the increase is mostly foreclosure sales – bargain hunters are snapping up properties at distressed prices. Experts believe this is a good thing, as these sales are clearing out excess inventory.
In the active adult community market there is still plenty of bad news to go around. Pulte Homes came out with a loss of $280 million in the quarter. Just about all the big players – Lennar, Pulte, Del Webb, Toll Brothers – are offering some form of incentives – lower prices, more free options, frequent flyer miles, new cars, mortgage payments and upgrades.
All eyes are now on October numbers, which will start to show what has happened in housing after the latest financial meltdown.