Neil Walter and Thayne Houston presented “What are Homes Worth in Today’s Market” to the St. George Chamber of Commerce.  Houston presented data on the local market and potential financing options.   According to Houston there are 2600 homes listed in the local MLS of which over 400 are ‘short sales’ and over 150 are ‘bank owned’. 

The median sales price is at $190,000 reflecting the high activity in the lower price ranges.  Many homes are bringing multiple offers.  Key factors for today’s buyers are:

• Mortgage Interest rates are hovering at 5%
• Home prices are at a 15 year low.
• Inventories are high offering a great selection.
• 1st time home buyers can receive an $8,000 federal tax credit on a home purchased before December 1, 2009.
• 1^st time home buyers could receive up to $10,000 toward down payment assistance through local programs.
• USDA loans available with up to 100% financing.

They discussed the appreciation and subsequent depreciation in home values over the past five years and how we will know when we have reached the “bottom”.  The presentation utilized an article published by USA Today that outlined three metrics for determining when home values will be at historical levels.  For each of the three metrics, they determined that home prices are back to historical levels when adjusting homes so that they are the same number of square feet.

They also discussed affordability as a comparison of mortgage payment divided by monthly income.  On this level, homes are as affordable as they have ever been and less expensive than renting for many properties.  The good news is that we are seeing pricing levels consistent with historical levels which means that we are close to the bottom. 

The indices may continue to fall as a result of fewer high end homes selling or additional reductions in prices for more expensive homes, but many believe we are seeing a firming up of the market for the