- The Washington Times - Friday, September 18, 2009

Despite the usual summer slowdown in real estate activity, 8,338 existing homes were sold in the Washington region last month. Sales were up 15 percent compared to August 2008 - and were higher than in both August 2007 and August 2006.

Stephen Israel, president of Buyer’s Edge, says his firm has had one of its best summers ever. It’s been so good that the company is hiring two additional Realtors this year, after not hiring any for four years.

Charting the Market: August resales.

“The news has been better, people are feeling more positive, and interest rates have stayed stable,” Mr. Israel says. “The statistics that have been coming out show the market leveling out in almost every jurisdiction; inventory is down dramatically, and settlements and contracts way up.”

Mr. Israel’s company represents only buyers, so he has a pretty good read on what homebuyers are thinking. He’s seeing the most aggressive activity in the more affordable end of the market. One reason for this is the dramatic price drops we’ve seen in the past couple of years. Another reason is the $8,000 federal tax credit for first-time buyers.

“That incentive is pretty dramatic, especially if you are buying a home for $300,000 or less,” Mr. Israel says. “And activity at that level kind of spurs further activity on other price levels as people realize they can move up. You’re shaking things loose.”

However, the tax credit is good only for purchases made after Jan. 1 and before Dec. 1. Assuming that other market dynamics remain about the same, the end of the federal program could diminish buyer enthusiasm. Rising mortgage interest rates also could have a cooling effect on the market.

That said, the improvement in housing stats throughout this year indicates that the worst part of the slowdown is behind us. The recovery may be slow or fast from this point on, but it seems to be under way.

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