USA Today Article

Congratulations to Greater Lafayette for being featured as the spotlight community in "USA Today's" weekly column, Close to Home.  For those of you not familiar with the column, it identifies a community in the U.S. each week and discusses the condition and unique features of its residential real estate market.  In the September 7th issue of the paper, Lafayette Indiana was featured.

The article, written by Christine Dugas, was well prepared and accurate.  Unfortunately, it was written just after the release of the July closed units numbers, so the tone was tepid.  Maggie Stark, a seasoned agent in our office and President of the Lafayette Regional Association of Realtors did a fine job explaining how the expiration of the home buyers tax credit created a natural decline in volume.  She also touted the overall strength of the community and local economy.

Cheryl Butcher also had an opportunity in the article to feature her 6,300 square foot log home on 14 acres on State Road 38.  It's hard to find better national exposure than the "USA Today".

July Residential Sales

Tippecanoe County Courthouse

As I have written earlier, the residential real state market across our country was favorably impacted by the first time home buyers tax credit created by Congress in early 2009 and expanded to include "move up" buyers in November, 2009.  In order for a buyer to qualify for the tax credit, an accepted offer on a home had to be in place by April 30, 2010 and the transaction had to close by June 30th.  As it turned out, Congress extended the close date deadline to September 30, 2010 after the close of business on June 30th.  [Note:  the inefficiency of Congress at times causes one to scratch their head and wonder why]

We had a strong sense that a meaningful portion of our demand this winter and spring was driven by the tax credit, but it was hard to quantify. As the April 30th deadline to have an offer accepted approached, the local market reached almost a frenzied pace. Many Realtors worked late nights in the weeks preceding April 30th.  It was wonderful!  As we feared, on the days and weeks that followed April 30th, the number of showings and accepted offers dropped noticeable compared to last year, especially for it being so early in the year.

Now that we are more than one month beyond the initial closing date deadline for the tax credit, we can measure the number of closed units with and without the benefit of the tax credit. The numbers are pretty incredible. Year to date residential unit sales through May 31, 2010 in the Greater Lafayette area were 19% ahead of the same period last year.  However, that is when the fun began to end.  Residential unit sales in June were 12% below last year and July was 32% below July, 2009.  On a year to year basis, year to date sales through July are 3% below last year.

We are currently in a slow season, measured by showing activity.  However, what we are experiencing now is not uncommon for the back to school season. We usually see a bump in showing activity and Open House attendance after Labor Day.  Let's wait to see what happens in September.  I'll report back

BAGL Parade of Homes

The Builders' Association of Greater Lafayette will host its annual Parade of Homes on Saturdays and Sundays, July 17th & 18th and 24th & 25th from 9:00 -- 5:00 each day. There will be 20 new homes open for your inspection. The details of each Parade home and there locations can be found on the attached page from the BAGL website. If you would like to review information on existing homes for sale, you can use the property search function from our company's website..

Home Buyers' Tax Credit

June 30th has come and gone.  Even though early evening on the 30th, Congress passed an extension of the closing date to September 30th, we got our deals.  However, it would have not been possible without a lot of extra effort expended by everybody involved with closing a real estate sale (lenders, inspector, appraisers, title companies and Realtors).

It is too early to capture the June, 2010 closing data, but I'm sure we will see a noticeable blip in closings compared to June, 2009.  I will report in a week, when the data is available.  Let's see if I am right.

"Not So Sixties" Home and Garden Tour

For those of you who can't get enough of HGTV, love to see what your neighbors have done to renovate or decorate their homes or enjoy the beauty of a fine residential garden, you might want to consider attending the Barberry Heights "Not So Sixties" Home and Garden tour in West Lafayette. Barberry Heights is a West Lafayette neighborhood developed in the 1960's and early 1970's, north of Sagamore Parkway and south of Cumberland Avenue between Salisbury and Soldiers Home Roads.

Here's a snippet from the material promoting the event.

"REMEMBER THE 60’S? Acres of avocado green and harvest
gold shag carpeting inside, with rows of round trimmed yew
bushes, looking like big fat birds, for landscaping in the yard?
Barbarry Heights is NOT SO SIXTIES now! Five neighbors
are inviting you to see their remodeled family homes and four
more are showing their gardens. All have been updated and
remodeled, highlighting what owner effort and imagination
can do to transform homes and landscaping.
Please join us to see large open spaces, lofts, wide windows,
new kitchens, and family antiques mixed with new colors and
collections. Gardens include Japanese, cottage, with medicinal
and aromatic plants, and just beautiful.
--Maybe a few new ideas, and at least a lovely afternoon!"

Tickets can be purchased in advanced at Ace Hardware and Gretel's in WL or Bennett's Garden Center in Lafayette Tickets can be purchased the day of the event in Lomell Park near the intersection of Barlow and Wilshire Streets in Barberry Heights. Tickets are $5 a piece. Children under 12 years old are free.

Life after the Home Buyers' Tax Credit

When I last wrote, I commented that it has been hard to quantify the impact of the Federal Home Buyers' Tax Credit Now that we have sales numbers, it's easier to measure. The results are very exciting.

Overall, sales volume in the Greater Lafayette residential market area through 4/30/10 were up by 38% from the same period of 2009. As I suggested in my prior post, the increase in activity was not equally spread across all price points. Although designed to assist home buyers at a multiple of price ranges, the value was found to be the highest among first time home buyers. Sales volume below in homes priced below $150,000 was up by 64%. On the other hand, volume between $150,000 and $300,000 was only up by 13%. But the important work in that sentence is "up". A very interesting occurrence took place in the market between $300,000 and $450,000, where volume rose by 80%. That is amazing.

On a more troublesome note, the softness in demand in houses priced above $450,000 continued to be slow. Sales volume in the first four months was 88% below the same period in 2009. Take a look at the link I created that shows the quality of homes for sale above $450,000.
Homes for sale above in Lafayette/West Lafayette above $450,000.

In the weeks that followed the 4/30/10 expiration of the tax credit eligibility, we saw a significant decrease in the number of showings of our listings. This is comes as no large surprise. There is no doubt that the attractive terms of the tax credit accelerated some demand that might have occurred otherwise later in the year. However as a group of real estate professionals, we would be remiss if we did not remind all members of our community that now, more than ever, is an excellent time to purchase a new home.

• Interest rate are very attractive.
• Our major employers are calling employees back to work.
• The Lilly to Evonik sale is complete and jobs are saved.
• There is an abundance of well priced homes for sale.
• Greater Lafayette continues to be a national leader in the stability of property values.

There is still more than enough time to identify and purchase a home before the 2010/2011 school year begins.

P.S. The Barn is at Historic Prophetstown in the Prophetstown State Park.

Spring in Residential Real Estate

We have made it through another winter and are enjoying the good weather and final days of the Federal Home Buyer Tax Credit program. The current program provides up to an $8,000 federal income tax credit to eligible first time home buyers and up to a $6,500 credit for eligible non-first time home buyers. In order to qualify, an accepted offer must be in place by April 30th and the sale must close by June 30th. Our office is very busy. Many agents are working late into the evening and often seven days a week.

It is hard to truly measure the impact the program has had on demand, but most of us would suggested it has been considerable. Year to date unit sales of existing homes in Tippecanoe County through March 31st are 17% higher than the same period last year. However, as I have mentioned in other writings, the strong demand has not been enjoyed by all price points. Here is a break down of 3/31 year to date unit sales in Tippecanoe County by price range compared to the timeframe last year.

1. Unit sales of home price less than $200,000 grew by 21% from 214 to 260.
2. Unit sales of homes priced between $200,000 and $400,000 grew by 4% from 44 to 46
3. Unit sales of homes priced above $400,000 dropped by 40% from 5 to 3.
4. Total unit sales grew by 17% from 263 to 309

These numbers would indicate that: 1) the middle price and upper price ranges are still soft and 2) the Federal Tax Credit is driving demand in the typical first and second time home buyer price ranges. It will be interesting to learn in early May what happens to our demand after the first eligibity deadline has passed. We are all hoping that the natural momentum of spring buyers season and the pleasant weather will support much of the demand we are enjoying. I'll report back in mid-May and report what we find.