House sales under contract but not closed in Greater Hartford plunged 51 percent in May compared with the previous month as the federal home buyer tax credit wound down, according to a report Wednesday.
The decline may be an early indicator that the strong sales recorded this spring were boosted by the tax credit and may not continue to be as strong.
There were 627 pending sales for single-family houses in May, compared with 1,287 in April, even as mortgage rates for 30-year and 15-year home loans are at historic lows, according to the Greater Hartford Association of Realtors, which tracks a 57-town region.
"The drop in pending sales is most likely a result of the expired tax credit, but the summer months are typically a strong market," said Jeff Arakelian, the association's president and chief executive. "I am hopeful that consumers continue to recognize the low interest rates and housing affordability that make this a great time to buy."
May's pending sales also were down 42 percent compared with the same month a year ago.
Closed sales rose nearly 10 percent in May to 789, compared with 718 in May 2009. A portion of that increase is probably still driven by the tax credit. To qualify for the credit, contracts needed to be signed by April 30 and closed within two months.
The median sale price rose less than 1 percent, to $230,000, from $228,000 a year ago.
The association tracks housing statistics using the multiple listing service. Another report, from The Warren Group, uses sale documents filed in town and city halls.
Reprinted with permission of the Hartford Courant.
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