With a big boost from expiring home-buyer tax credits, home sales in Northwest Indiana blossomed in April, with buyers snatching up homes at a pace not seen since the housing boom.
Existing single-family home sales were up 50.4 percent in the five counties covered by the Greater Northwest Indiana Association of Realtors, with a total of 787 homes sold as compared to 510 in April 2009.
The last month of home buyer tax credits helped power home sales in April, but that strength has continued right into May, said Minakshi Ghuman, a Realtor with Century 21 Pace Estates, in Valparaiso.
"It's very, very busy right now," she said on Monday between home showings. "We were expecting after the big rush last month things would quiet down, but it has not. If anything it has gotten stronger."
Historically low interest rates and moderate pricing continue to support sales, Ghuman said.
The median selling price of a Porter County home in April was $150,000, a 3 percent increase from one year ago, according to data from the Northwest Indiana Association of Realtors. Overall in Northwest Indiana, the median selling price moved up 8.4 percent.
Nationally, home sales were up 22.8 percent in April from one year ago, according to the National Association of Realtors.
National Association of Realtors Chief Economist Lawrence Yun said there will undoubtedly be a temporary fall back in the coming months, but the fundamentals of the market remain strong enough to maintain buyer interest.
The market may also get a boost in coming months from interest rates that have unexpectedly returned to historic lows. Last week, the average interest rate on a 30-year fixed-rate mortgage was 4.84 percent, according to Freddie Mac data.
"For people who were on the sidelines, there's been a return of buyer confidence with stabilizing home prices, an improving economy and mortgage interest rates that remain historically low," Yun said.
For first-time home buyers, the tax credits were worth up to $8,000 and for existing home owners buying a new home they were worth up to $6,500. Anyone with a signed purchase agreement in place by April 30 can still qualify for the credits as long as they close on the sale by the end of June.
The Northwest Indiana Association of Realtors represents home-sale agents and tracks sales in Lake, Porter, LaPorte, Jasper and Newton counties.
In Porter County, existing home sales were up a whopping 112.8 percent in April, with 183 homes sold. In Lake County sales were also up strongly, rising 33.8 percent above the same month one year ago.
There was more hopeful news in two reports from the National Association of Realtors.
Distressed homes, such as those in foreclosure, accounted for 33 percent of sales nationally in April, down 2 percent from the month before. Investors accounted for 15 percent of sales in April, down from 19 percent the month before.
"A return to old-fashioned responsible lending and buying will help the housing market avoid disruptive and painful bubble-bust cycles," Yun said.
