A big picture kind of post talking about real estate market conditions across the entire US including existing and new home sales numbers…
First off, let me say this is a big picture kind of post. By that I mean I will be talking about real estate market conditions across the entire US and not right here in Upstate South Carolina. However, perception is reality sometimes. Many buyers and sellers are influenced by reports in the media so we have to understand these reports.
NAR Existing Home Sales
The National Association of REALTORS reported that existing home sales for July 2013 were good. Of course, when has NAR ever said anything bad about the housing market? You probably saw yesterday’s post that had the news from FHFA that home prices increased 7.7% year over year in June. So it isn’t just NAR reporting increasing home prices.
NAR is reporting that existing-home sales in July 2013 increased 6.5% from the June 2013 level. Also existing home sales are 17.2% above the July 2012 level. This is 25 months in a row that we have seem positive changes if we look at the year over year numbers.
NAR is also saying that the number of homes for sale at the end of July rose 5.6%. This suggests good news for home buyers who’ve been frustrated by the limited number of homes for sale.
The national median existing-home price is 13.7% higher than back in July 2012. This is 17 consecutive months of year-over-year price increases. We should see more home owners deciding to sell as home prices continue increasing.
New Home Sales Numbers
More good news for frustrated buyers is that the number of new homes for sale increased from a 4.30 month supply in June to a 5.20 month inventory in July. This was the highest inventory of available new homes since January 2012.
The bad news is that for the entire US, new home sales for July 2013 dropped by 13.4% from the previous month. New home sales were 13.4% lower in the South. I wouldn’t freak out about that drop from the previous month since July’s home sales were 6.8% above the July 2012 level.
Increasing Mortgage Rates
I hope you are not getting stressed out higher mortgage rates. Despite the recent increases in mortgage rates, many people are either forgetting or unaware that mortgage rates are STILL super low. Check out this quote from The HSH Blog:
That said, there is nothing wrong with a 30-year fixed-rate mortgage at 5 percent or thereabouts. In fact, before the Fed began directly manipulating the mortgage market in 2008, the lowest conforming 30-year fixed-rate mortgage we “naturally” achieved was 5.24 percent back in June 2003 … a 37-year low at the time.
Don’t get me wrong. I am NOT saying buyers should ignore the increasing mortgage rates. Especially since rising rates will have a major effect of their buying power. And I have been preaching for several weeks about rates increasing even more when the Federal Reserve begins tapering quantitative easing.
Plus we have to worry about the situation in Syria. If things get worse or the US does attack Syria, then the financial markets will react.