Discussing the latest reports on home prices, pending home sales, supply and demand of houses for sale plus much more…
Sorry for the lack of posts last week but I actually took some time off. The break was nice but no rest for the wicked so let’s dive in!
Another Strong Month for U.S. Home Prices
From Black Knight:
- The national-level home price index (HPI) hit another new peak in May, marking a 4.6 percent gain in home prices so far in 2017
- At 6.1 percent vs. April’s 6.0 percent, year-over-year price appreciation continued to accelerate in May
- Home prices in every state and the 40 largest (by population) metros increased in May
- 11 of the 20 most-populous states and 20 of the 40 largest metros hit new peaks for home prices
Remember this is talking about the entire U.S. and is for the month of May. So while it is very good news, buyers and sellers must ALWAYS rely upon a local expert to know exactly what is happening in their market.
Pending Home Sales Recover
After declining for three straight months, pending home sales reversed course in June as all major regions, except for the Midwest, saw an increase in contract activity. The Pending Home Sales Index climbed 1.5 percent to 110.2 in June from an upwardly revised 108.6 in May. At 0.5 percent, the index last month increased annually for the first time since March.
Lawrence Yun, NAR chief economist, said:
The first half of 2017 ended with a nearly identical number of contract signings as one year ago, even as the economy added 2.2 million net new jobs. Market conditions in many areas continue to be fast paced, with few properties to choose from, which is forcing buyers to act almost immediately on an available home that fits their criteria.
Good to see pending home sales increase despite the low inventory of homes for sale in many areas of the country. Sometimes I worry that some sellers think that the low inventory issue means they can ignore the basics rules of home selling…
Because you cannot!
Don’t get me wrong. There is no doubt that buyer demand is very strong!
Supply and demand is a basic part of economics. Price item is dependent upon the availability of the item, along with the demand for it.
Let’s look at the most recent REALTORS Confidence Index to examine the demand and supply of homes for sale.
Home Buyer Demand
The map below show how much buyer traffic there is across the country:
The darker the blue, the stronger the demand in that state. As you can see, demand in South Carolina is strong!
Now let’s look at supply…
Supply of Homes for Sale
If we look at the supply according to the same report, we can see that there are fewer homes for sale than needed to satisfy the demand:
It just isn’t tough to see why home prices are increasing. Strong demand and limited demand equals increasing prices. So while sellers must be realistic about their asking price, it is a very good time to sell a home. If you have any questions about selling a home in the Anderson area, please contact me!
What Renovations Are Best When Selling a Home
Rents Still Rising
According to Zumper, one bedroom median rent increased by 1.2% and two bedroom median rent increased 0.6%.
It is nice to see some cooling off in the growth of rents since it will make it easier for renters to save to buy a home.
Fannie’s Mortgage Serious Delinquency Rate at Lowest Since December 2007
Fannie Mae just reported that their Single-Family Serious Delinquency rate declined to 1.01% in June, from 1.04% in May. The serious delinquency rate is down from 1.32% in June 2016.
This is the lowest serious delinquency rate since December 2007. Obviously, this is good news as it should mean fewer foreclosures. The Fannie Mae serious delinquency rate peaked way back in February 2010 at 5.59%.
Another Report of Increasing Home Prices
CoreLogic just reported that U.S. home prices, including distressed sales, increased year over year by 6.7% in June 2017 compared with June 2016 and increased month over month by 1.1% in June 2017 compared with May 2017.
CoreLogic is forecasting that U.S. home prices will increase by 5.2% on a year-over-year basis from June 2017 to June 2018. I do not have a crystal ball to predict how much home prices will increase in the Anderson area…
That being said, I do think we will continue to see home prices to increase unless something catastrophic happens with the economy.
The U.S. Is the Sick Man of the Developed World
What do the economists at the International Monetary Fund see when they look at the U.S.? This sense is generally borne out by economic data and when comparing the U.S. with other advanced economies. The clear message is that the U.S. — the richest nation on Earth, as is frequently proclaimed, although it’s actually not the richest per capita — is increasingly becoming the developed world’s poor relation as far as the actual living standards of most of its population go.
So can we expect our elected officials to actually do something about this? More importantly, do you think any of them care?
This is why we cannot rely upon anyone but ourselves to make our lives better. Politicians lie, jobs come and go, economic situations change. Being prepared is the ONLY way to keep moving forward to your goals in life.
Manufacturing Expands Again
According to the July 2017 Manufacturing ISM Report on Business, economic activity in the manufacturing sector expanded in July, and the overall economy grew for the 98th consecutive month.
Obviously this is great news and nothing to sneeze at. Hopefully this will lead to more robust income growth for the majority of Americans…