The California Association of Realtors reported on March 10th that in 2009, nearly half of the homes sold went to first-time buyers. But the chief economist for CAR said that because of the pending end of the first-time buyers tax credit, this % will probably dip in 2010.
This 47% is up from 35.9% in 2008 and the highest since just more than 50% in 1995.
Leslie Appleton-Young, the CAR’s chief economist, said that the rist was due to falling prices, low mortgage rates, and the tax credit. She predicted that the proportion of first-time buyers could still rise above 50% this year because the more expensive end of the market continues to be weak. “The top end is challenged by unrealistic pricing by sellers,” she said.
Sales have reduced the inventory of unsold homes, but they still stood at 5.8 months for starter homes and 14.8 months for the top end.
A little more than half of all sales last year were distressed properties — bank-owned and properties selling as short sales.
Young continued,”I think it’s going to be flat for the foreseeable future. Price trends will vary by price category. Areas that went down the sharpest and have the greatest degree of distressed sales will come back strongest and have the sharpest recovery. It’s already happened. At the upper end, I think we’ll see a more sluggish price performance over the next couple of years.”