Webster's New World Collegiate Dictionary defines anomaly as a "departure from the regular arrangement, general rule or usual method."
By this definition — and any other, for that matter — June's home sales figures for Lancaster County certainly qualify as an anomaly.
While the trend lines of pending and final sales typically parallel each other, last month that pattern flew out the window. According to the Lancaster County Association of Realtors, the number of settled units climbed 18 percent over June 2009 — while total pending sales plummeted 29 percent.
The federal homebuyer tax credits are responsible for this odd real estate glitch, which likely won't be repeated anytime soon. With that incentive expiring after having been in effect well over a year, local real estate agents say the true state of the market won't be evident until late summer or early fall.
Deadline dash
The $8,000 credit for first-time buyers became available in February 2009 when President Barack Obama signed the $787 billion economic stimulus package. A $6,500 credit for existing homeowners who purchase a house was added in November.
To qualify, people had to sign an agreement on a home by April 30, which is why the number of pending sales here dropped from a robust 648 in April to 331 in June. The June 2010 figure represents a significant decline from the 466 pending sales of a year before.
Purchasers also needed to settle on their homes by June 30, explaining the jump in final sales from 383 in April to 568 in June. By comparison, 480 houses were sold in June 2009.
According to the county Realtors association, the June 2010 total is the most for any month since July 2007, when 584 homes sold.
Overall, second-quarter home sales were up 14.1 percent compared to last year.
A few days before the $8,000 and $6,500 credits were to expire at the end of June, President Obama signed an extension allowing buyers who inked an agreement by April 30 to complete their purchases by Sept. 30 and still claim one of the credits. That was done because an estimated 180,000 homeowners would have missed the second deadline due to a work backlog among lenders and others involved in the home-buying process.
Thursday, the National Association of Realtors reported that existing home sales across the country in June were up 9.8 percent from a year earlier, buoyed by the tax credits.
Lawrence Yun, the NAR's chief economist, said in a press release that he also expects the next few months to reflect some residual positive impact from the credits because of the extension.
What is a normal market?
Even without the tax credits, mortgage rates still make it a great time to purchase a house, said Bob Rose, president of the Lancaster County Association of Realtors.
"Interest rates right now are at a 50-year low," he said.
An agent with Prudential Homesale Services Group, Rose said he got an e-mail last week from a local lender offering a 30-year fixed-rate mortgage with zero points at 4d-, percent.
"And FHA is at 4.25 percent," he said. "It makes me want to go out and buy something."
Activity has clearly slowed in July, but that's hardly a surprise, Rose said. Typically, things settle down now because potential buyers — and real estate agents — are on vacation, he said.
"I think we're kind of retooling."
The true test of where the market stands will likely come in September, Rose said.
Quentin Miller, an agent with Coldwell Banker Select Professionals, agreed. "September will tell the tale," he said.
He said he's looking forward to what the residential market will be like when the tax credit impact is gone.
And once the dust settles, agents will be looking at a new definition of "normal," Miller said.
What constitutes a normal market after the roller coaster ride of the past several years "is what we're trying to find out," he said.