WALTHAM, Mass. – October 12, 2011 – The Massachusetts Association of REALTORS® (MAR) today announced that for the second straight month, REALTOR® members were more confident about the market in September 2011 compared to the same time last year according to the most recent REALTOR® Market Index. The September REALTOR® Price Index (RPI) was down from September 2010. On a month-to-month basis, both indexes were down. When asked about the impact the return to lower FHA and GSE loan limits will have on the Massachusetts real estate market, REALTOR® members were split.

 

“For the second month in a row REALTOR®-member confidence increased over the same time last year; which is a good thing,” said 2011 MAR President Laurie Cadigan, broker-owner of Barrett & Company in Concord. “While members are split on what impact a return to the lower FHA/GSE loan limits will have on the Massachusetts real estate market, we believe more focus is needed on housing in Washington DC to help the market and economy improve.” 

 

In September 2011, the REALTOR® Market Index was 21.63, which was up 11.58 percent from the September 2010 score of 19.39.  This is the second straight monthly year-over-year increases since April-May 2010. On a month-to-month basis, the September RMI was down 24.28 percent from the 28.57 score in August 2011. Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.    

 

In September 2011, the REALTOR® Price Index was 37.38, which was down 12.44 percent from the September 2010 RPI of 42.69. This is the fourth straight month of year-over-year decreases. On a month-to-month basis, the RPI was down 6.35percent from the August 2011 RPI of 39.93. 

 

REALTOR® members were asked in September what type of impact they felt the return to lower Federal Housing Administration (FHA) and GSE (Fannie Mae and Freddie Mac) loan limits would have on the Massachusetts real estate market.  Seventeen percent of respondents felt the return to lower loan limits would have a positive impact and 39 percent felt there would be a neutral impact. Forty-four percent felt the lower limits would have either a negative impact (34 percent) or a significant negative impact (10 percent). None of the respondents thought these lower loan limits would have a significant positive impact.
 
About the REALTOR® Index Methodology:
The Massachusetts REALTOR® Market Index (RMI) and Price Index (RPI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market.  More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.

 

1. How would you describe the current housing market?
2. What are your expectations of home prices over the next year?

 

In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.

 

The RMI is calculated in the following way.  Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points).  The results are the average score for each question.  A score of 50 is the threshold between a “strong” and a “weak” condition.  Similarly, the question about home prices over the next year (REALTOR® Price Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).

 

About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000 members.  The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.

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