Tag Archives: existing home sales

Real Estate

Sellers Market May Be Changing To Buyers Market

Scotts Flat Lake taken from my deck John J ODell

The real estate tide is turning, according to Fortune Magazine’s Chris Morris. What was once a seller’s market, complete with frenzied offers and multiple bidding, is beginning to smooth a bit, becoming what Realtors refer to as a “balanced market” where homes stay on the market a tad longer, and buyers actually have a chance to negotiate.

The National Association of Realtors says existing home sales in January dropped to their lowest level in three years, with existing home sales down 1.2% to an adjusted annual rate of 4.94 million units last month. That’s below analyst expectations and an 8.5% drop from a year ago. According to their stats, only the Northeast saw a rise in sales activity.

And while home prices are still showing increases, they’re nowhere close to the rise we saw in recent years. The median price of an existing house climbed 2.8% in January to $247,500, the smallest increase since February 2012. According to the article, prices have increased for 83 consecutive months, but experts are now saying that trend could be ending. All that means is that buyers now have a chance to participate in the American Dream.

“The number of homes on the market is starting to rise, too, meaning buyers have a wider selection to choose from,” says Morris. “In January, there were 1.59 million previously owned homes on the market, compared to 1.53 million in December. The average home stayed on the market 49 days, a week longer than January 2018.” Forbes real estate also predicts the wave of first-time home buyer demand will be met by somewhat higher inventory levels than in 2018, according to a year-end article by Aly Yale.

Morris goes on to cite the NAR’s chief economist, Lawrence Yun: “Moderating home prices combined with gains in household income will boost housing affordability, bringing more buyers to the market in the coming months.” 

So if you’ve got a house on the market, patience is a virtue, along with pricing it to sell. And if you’re in the market to buy, prepare to have more to choose from.

Source: Fortune, Forbes, NAR, TBWS

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    Real Estate

    Pending Home Sales Highest Level Since Late 2006

    House-on-stilts

    Pending home sales rose in May to the highest level since late 2006, implying a possible spark as mortgage interest rates began to rise, according to the National Association of Realtors®.

    The Pending Home Sales Index,* a forward-looking indicator based on contract signings, increased 6.7 percent to 112.3 in May from a downwardly revised 105.2 in April, and is 12.1 percent above May 2012 when it was 100.2; the data reflect contracts but not closings.

    Contract activity is at the strongest pace since December 2006 when it reached 112.8; pending sales have been above year-ago levels for the past 25 months.

    Lawrence Yun, NAR chief economist, said there may be a fence-jumping effect.  “Even with limited choices, it appears some of the rise in contract signings could be from buyers wanting to take advantage of current affordability conditions before mortgage interest rates move higher,” he said.  “This implies a continuation of double-digit price increases from a year earlier, with a strong push from pent-up demand.”

    Yun upgraded the price forecast for 2013, with the national median existing-home price expected to rise more than 10 percent to nearly $195,000.  This would be the strongest increase since 2005 when the median increased 12.4 percent.

    Existing-home sales are projected to increase 8.5 to 9.0 percent, reaching about 5.07 million in 2013, the highest in seven years; it would be slightly above the 5.03 million total recorded in 2007.

    The PHSI in the Northeast was unchanged at 92.3 in May but is 14.3 percent above a year ago.  In the Midwest the index jumped 10.2 percent to 115.5 in May and is 22.2 percent higher than May 2012.  Pending home sales in the South rose 2.8 percent to an index of 121.8 in May and are 12.3 percent above a year ago.  The index in the West jumped 16.0 percent in May to 109.7, but with limited inventory is only 1.1 percent above May 2012.

    The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.  For additional commentary and consumer information, visit www.houselogic.com and http://retradio.com.

    # # #

    *The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

    The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales.  In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

    An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined.  By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

    Source: National Association of Realtors®.

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    Real Estate

    Existing-Home Sales Down, but Prices Rise

    Existing-home sales fell as expected in December after first-time buyers rushed to complete deals during the months leading up to the original November deadline for the tax credit. However, prices rose from December 2008 and annual sales improved in 2009, according to the National Association of REALTORS®.

    Existing-home sales—including single-family, townhomes, condominiums and co-ops—fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million units in December from 6.54 million in November, but remain 15 percent above the 4.74 million-unit level in December 2008.

    There were approximately 5,156,000 existing-home sales in 2009, which was 4.9 percent higher than the 4,913,000 transactions recorded in 2008. It was the first annual sales gain since 2005.

    Tax Credit Creates Swing in Market

    Lawrence Yun, NAR chief economist, says there were no surprises in the data.

    “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” he said. “We’ll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010.”
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