Housing is entering the heart of the spring season, but buyers are still not warming up to the market. Home sales are down across the nation as higher prices, tight credit and higher interest rates hold demand in a headlock. The nation's home builders are seeing improvements, but only on their higher-priced homes, which is where much of the focus is now.
Sales of homes priced above $750,000 increased 13 percent in February from a year ago, according to the National Association of Realtors. Homes priced below $250,000 fell 11 percent. Those lower-priced homes make up 64 percent of all home sales. The trouble on the lower end is that investors are finding less to buy as fewer homes fall into foreclosure. First-time home buyers, who should pick up the slack, are having trouble qualifying in today's mortgage market. Analysts argue this is no time for the Federal Reserve to be pulling out of the mortgage market.
"Until proven otherwise, these numbers are awful, and create a need for continued Fed accommodation and a positive technical backdrop for securitized products, especially credit," Bank of America analysts Justin Borst and Chris Flanagan wrote in a note to investors.
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The bright spot, again, is the higher end. Sales of homes priced over $1 million are up over 14 percent from a year ago. What buyers get for a million dollars, however, varies greatly market to market. More than 40 percent of for-sale listings in metro San Francisco are over $1 million, as are more than 20 percent in Fairfield County, Conn., according to a report from Trulia, an online real estate company. The smallest million-dollar homes are in New York, typically less than 1,500 square feet, but those homes stretch to 6,000 square feet in the Kansas City area and Pittsburgh.
http://homes.yahoo.com/news/million-dollar-homes-march-madness-114800575.html
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