Continuing the market's trend: Hamilton County reports 62 homes that went under contract last week while Marion County saw 173 homes pend. 

The numbers for July are in and according to MIBOR here are the Highlights:

• During May to July 2010, average sale price increased 5.7% when compared to the same period in 2009. 
• Average Sale Price increased 8.9% during July 2010 when compared to July 2009.
• Closed Sales decreased 4.1% during the three month comparison and decreased 30.4% during July 2010 when compared to July 2009.
• Pended sales during May to July 2010 decreased 30.7% when compared to the same three month period in 2009. The one-month comparison recorded a 27.2% decrease during July 2010 from the same month in 2009.

The Verizon Wireless Music Center is one of the best places in the Midwest to see a concert, it is no surprise that the 2010 schedule is packed with top performers. Indianapolis is lucky to have such a venue! 

5/7/2010                      Pearl Jam

5/15/2010                    Jimmy Buffett

5/22/2010                    Nickelback

5/23/2010                    Country Throwdown 2010

5/29/2010                    X103 MayDay with Three Days Grace

6/5/2010                      Brad Paisley

6/18-19/2010                Dave Matthews Band

6/27/2010                     Lynyrd Skynrd

7/6/2010                      Vans Warped Tour

7/7/2010                      Steve Winwood/Santana

7/10/2010                     Tom Petty & The Hearbreakers

7/16/2010                     Brooks & Dunn with Gary Allan

7/20/2010                     Lilith

7/22/2010                     Chicago and The Doobie Brothers

7/23/2010                     Jack Johnson

7/31/2010                     The Rockstar Energy Mayham Festival

8/3/2010                       Rihanna

8/12-13/2010                 Phish

8/15/2010                     John Mayer

9/3/2010                       Kings of Leon

Last week, 4/16-4/23, Hamilton County had 125 homes go under contract and Marion County saw 304 homes go under contract. Our reporting does not count this past weekend, which unless extended, will have been the last home shopping weekend to take advantage of the Home Buyer Tax Credit. By all accounts the tax credit worked. We have been saying for about a year now that with interest rates so low, free money available, and prices down from their 2007 highs this has been an amazing time to buy a home. 

The remaining question is how will the housing market fare when standing on it's own? Our prediction is that in that the summer months will be down as many of the would be summer and early fall first time homebuyers purchased homes earlier than expected to take advantage of the tax credit. Fall and Winter should be in line with previous averages and we should begin to see a normally increasing numbers by next March.

Financier Warren Buffett on the state of the housing market:

"Within a year or so, residential housing problems should largely be behind us," Buffett wrote Saturday in his annual letter to the shareholders of his Berkshire Hathaway. "Prices will remain far below 'bubble' levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits. Indeed, many families that couldn't afford to buy an appropriate home a few years ago now find it well within their means."

Families in the market for a house are shopping at the right time: Nationally, homes are near the most affordable they've been in 18 years. In the fourth quarter of 2009 housing was 62.4% more affordable than the same time a year earlier, according to the Housing Opportunity Index, published quarterly by the National Association of Home Builders and Wells Fargo.

In Depth: America's Best Housing Markets
The best place to buy right now: Pittsburgh. For a housing market to be attractive it should have appreciating prices that show homeowners are making wise investments; an affordability rating that gives middle-class families with good credit entry into the market; and a relatively low number of foreclosures, which keeps prices stable and indicates there isn't an excess of inventory.

Pittsburgh has all three. In the metro area, 85% of homes are affordable to those making the median family income of $62,500. At the same time, foreclosures are low: Only one home is in foreclosure for every 120 housing units--the second-best record of all the cities we ranked; and home prices are expected to increase 2.67% by the end of the year.

Yes, the city has suffered greatly since the decline of its manufacturing-dependent economy. But that slump helped its real estate market dodge the rapid run-up in prices that doomed so many markets after the housing boom.

"Manufacturing cities like Pittsburgh have suffered so much for the last two, three, four years that there's still a population base in that region, and now those areas are sort of attractive," says James P. Gaines, research economist at the Real Estate Center at Texas A&M University. "Home prices are so low, some service-level jobs can be created, so it's not surprising perhaps that there's been a revitalization of some of those communities."

Behind the Numbers

To find the country's best housing markets, we used the Housing Opportunity Index, a metric created by the National Association of Home Builders and Wells Fargo that determines affordability by measuring median home prices against median incomes. Using the 40 largest housing Metropolitan Statistical Areas that the HOI ranks, we then factored in Moody's Economy.com's one-year forecast for the S&P/Case-Shiller Home Price Index, a measure of sales prices in major markets, to find out where home prices were expected to rise. Finally we included the 2009 Foreclosure report from RealtyTrac, ranking cities by their percentage of foreclosures. We averaged the rankings for all these measures to arrive at an overall score.

The reason for taking all these factors into account is that alone each doesn't say much about a housing market's health. An area could be affordable because prices were dragged down by a glut of foreclosures. Similarly, a low foreclosure rate doesn't guarantee that home-buying is a good investment, as values could be flat or falling. Even looking at home-price forecasts in a vacuum won't tell you everything about a market, since some areas have dramatic price increases ahead due to severe drops back when the bubble burst.

Like Pittsburgh, Columbus, Ohio, might not jump to mind as one of the country's best cities for housing, but job-rich suburbs surround the city and 87% of middle-income families can afford a home. That combination creates significant pull for homebuyers.

Also looking strong is Louisville, Ky., a city whose low foreclosure rate--only 1.15% of homes are in foreclosure, half the national average--illuminates it as one of the cities least affected by this aspect of the dramatic housing market collapse of the past three years. Louisville had less of a market boom than coastal cities and vacation destinations, so it didn't have as far to fall.

Jobs Stability Equals Housing Stability

Strong industries have bolstered some of the cities on our list: The energy sector has kept jobs flowing into Texas oil town Houston, and that effect trickles into Dallas and Austin (which is also buoyed by technology jobs). A good job market means the housing outlook will stay strong. Houston home prices are expected to rise 1.2% by next year; it's one of only four of the markets we ranked where prices won't continue to slide, according to Moody's Economy.com.

Midwestern cities Indianapolis, Minneapolis and St. Louis make our list in spite of middling home-price forecasts because housing in these places is eminently affordable. Indianapolis has the highest HOI in the country, with decent housing accessible to 96% of families making the median income. In places like this the recession has weighed down home prices, but mortgage rates are still at historic lows, giving families a chance to get in on the ground floor.

Some markets are accessible to buyers because of a price slide now, yet still offer wise investment choices. In Minneapolis-St. Paul, which is ranked seventh in HOI, prices will continue to slide this year by three-quarters of a percent; but by 2012 they will have risen 2.82%.

Most real estate markets are struggling, some quite severely, so discussing the best ones is relative. But between the even-keeled housing climate of some Midwestern cities and the job opportunities in Texas, real estate in these areas is worth keeping an eye on.

America's Top 5 Housing Markets

1. Pittsburgh, Pa.
1-year Home Price Forecast: 0.03
Housing Opportunity Index: 85.1
% of Housing Units in Foreclosure: 0.83

2. Louisville-Jefferson County, Ky.-Ind.
One-year Home Price Forecast: -0.01
Housing Opportunity Index: 84.3
% of Housing Units in Foreclosure: 1.15

3. Houston-Sugar Land-Baytown, Texas
One-year Home Price Forecast: 0.01
Housing Opportunity Index: 73.2
% of Housing Units in Foreclosure: 1.3

4. Minneapolis-St. Paul-Bloomington, Minn.-Wis.
One-year Home Price Forecast: -0.01
Housing Opportunity Index: 84.9
% of Housing Units in Foreclosure: 2.2

5. Indianapolis-Carmel, Ind.
One-year Home Price Forecast: -0.02
Housing Opportunity Index: 95.7
% of Housing Units in Foreclosure: 2.47

Click here to see the full list of America's Best Housing Markets

By: Francesca Levy, Forbes.com

Home Sales in Hamilton and Marion Counties were up 19% in the fourth quarter 2009 compared with the fourth quarter 2008. In fact, the fourth quarter of 2009 was the strongest since 2006! The brightest spot was Carmel, where sales were up 41% during that time period. 

Though we are Realtors with Sotheby's Realty in Indianapolis we have contacts with top producing realtors across the country. If we don't personally know someone, we will search every major real estate brokerage on your behalf to find the most qualified agent to meet your buying or selling needs. The agents will be interviewed and evaluated based on:

• Production 
• Education/Certifications 
• Marketing 
• Agent and Client References  

We offer this service free of charge, if you have a friend or family member who is in need of the best real estate service in their area, email us HERE or reply to this note. We can generally track down the right person within 24 hours.

Know of someone buying or selling a home ANYWHERE? Click Here and we will help!

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As of January 4, 2010 we have joined Encore Sotheby’s International Realty as Founding Members. This change, while substantial, requires no action on your part other than understanding the benefits to you while buying and selling real estate on the Northside of Indianapolis.

Founded in the mid 1700’s, Sotheby’s has a long-standing reputation of outstanding knowledge, service and the ability to sell hard to sell items. It is exciting to be a part of such a grand opening as it unfolds in our city.

Sotheby’s perspective compliments the ideals our business was built on. They understand that uniting people with properties is more of an art than a science and are committed to discovering the distinction in all homes. Their commitment to providing unrivaled service and a refined experience matches our own and will allow us to help you achieve your dreams while remaining a connoisseur of life

We are certain our association with Sotheby’s will be mutually beneficial. As always, if there is anything we can do for you, your family or your friends, please call our email. 

What a year it's been. Thank you for following us as we update you weekly of Northside Indianapolis' real estate progress, and sometimes lack thereof. All in all, this year was not nearly as bad as predicted. Plan on more of the same during 2010, the key indicator is going to be interest rates, if they continue to stay at their levels, the market should remain robust, but if they tick up as expected, it could call for a slow down in sales.

As 36 homes went under contract in Hamilton County and 91 in Marion County during the holiday week, we thought you'd like to see a brief recap of 2009 by the numbers:

As always, we enjoy being your source for information and if there is anything at all we can do for you, your family or your friends, please let us know.

From Jay, Jason and Ryan

Welcome 2010!

NAR Issue Brief Homebuyer Tax Credit

National Association of REALTORS^® Government Affairs Division 500 New Jersey Avenue, NW, Washington DC, 20001

The Obama administration blessed the proposed extension of the $8,000 tax credit for first-time home buyers on Thursday as the Senate neared a compromise that would extend the credit to more potential buyers.

Here’s a primer on who might be able to get the expanded credit, and what it might do for the housing market:

Who gets the credit, and how much can they claim? First-time home buyers are eligible for up to $8,000 on the tax credit, which is the same as the current credit. The Senate version of the bill creates a new credit of up to $6,500 for homeowners who have lived in their homes for five years. That provision would start on Dec. 1.

How long will it last? The tax credits would expire on April 30, 2010, but home buyers under contract by April 30 would be able to qualify as long as they complete the sale within 60 days. Keep in mind, this would be the third iteration of a home buyer tax credit that has been in place since mid-2008. Sen. Johnny Isakson, the Georgia Republican who has been a staunch advocate of the credit, promised that this would be the “last extension” of the credit, according to Dow Jones Newswires’ Corey Boles. “Tax credits like this only work by creating the sense of urgency to take advantage of it,” Sen. Isakson said.

Will the tax credit do anything for the high-end of the market? Probably not. The tax credit phases out for home buyers with incomes above $125,000 for single filers and $225,000 for married couples. Also, homes that cost more than $800,000 aren’t eligible for the credit. Overall, the tax credit is likely to generate only a modest further increase in home sales, says Tom Lawler, an independent economist in Leesburg, Va.  For many well-paid people, he says, it won’t make a big difference: “A household earning around $150,000 is likely to buy a home of $500,000 plus, so a $6,500 credit won’t be much of a factor in pushing such households off the fence.”

What other limits does the credit have? Toddlers are out of luck. Last week’s congressional hearings spotlighted concerns about misuse of the credit, including some 500 tax filers under age 18 who had claimed the credit.

So will the expanded tax credit help sales? That’s a point of debate among housing analysts and economists. Alec Phillips, economist at Goldman Sachs, notes that expanding the credit to people who already own homes doesn’t necessarily make a big dent in the supply of housing on the market. “If these ‘step-up’ buyers already own a home and sell it to finance the new one, that hasn’t reduced the amount of inventory for sale,” he says.

But Mark Zandi, chief economist at Moody’s Economy.com, thinks the extension is a big deal. Based on a preliminary analysis, he said it should mean at least 500,000 in additional sales, atop the 400,000 he estimates already have been generated by the tax credits (twice the Goldman estimate). “The tax credit is not a very efficient tax cut, but not extending it would do significant damage to the still fragile housing market,” Mr. Zandi said.

By WSJ Staff

NIck Timiraos and James R. Hagerty report:

WASHINGTON - Aspiring homebuyers rushed to take advantage of a tax credit for first-time owners that expires in November, driving up the number of signed sales contracts for the seventh straight month in August.

Construction spending also rose unexpectedly in August on the biggest jump in housing activity in nearly 16 years, another sign the real estate market is recovering from its four-year slump, data Thursday showed.

Sales and homebuilding are being fueled by a tax-credit of up to $8,000, low mortgage rates and cheap foreclosures. In some of the most hard-hit areas, like Phoenix and Las Vegas, there are bidding wars for deeply discounted properties. And in all but a few cities, home prices are slowly starting to rise, reversing their three-year descent.

To make sure first-time buyers can complete their purchases by the Nov. 30 deadline, real estate agents "have been pushing buyers to sign a contract at least a couple months in advance" according to Abiel Reinhart, an economist with JPMorgan Chase.

More than a dozen bills have been introduced in Congress to extend the credit, but it's unclear if lawmakers want to continue to subsidize the market.

The National Association of Realtors said Thursday its index of sales agreements rose 6.4 percent from July to 103.8, beating forecasts. It was the highest since March 2007 and 12 percent above a year ago. Economists surveyed by Thomson Reuters expected the index would rise to 98.6.

Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer of future sales. However, new rules for home appraisals and rigid lending standards have scuttled many sales agreements recently. In addition, the index may also double-count some buyers who agree to purchase other homes after the first deal falls through.

These factors have made the index a less reliable gauge for completed sales. Despite a steady increase in the number of signed contracts this summer, for example, completed sales actually took an unexpected 2.7 percent dip in August.

"Perhaps the real question is how many transactions are being delayed in the pipeline, and how many are being canceled," Lawrence Yun, the Realtors' chief economist, said in a statement. "Without historic precedents, it's challenging to assess."

Pending sales were up 16 percent in the West and 8 percent in the Northeast. They were up 3 percent in the Midwest and nearly 1 percent in the South.

Home prices, meanwhile rose 1.2 percent from June to July, according to the Standard & Poor's/Case-Shiller home price index of 20 major cities. On a seasonally adjusted basis, prices rose in all but three metro areas, Las Vegas, Detroit, and Seattle.

Housing experts, however, remain divided on whether the price gains signal a definite bottom to the worst housing downturn in decades or just a brief respite from plummeting prices.