Home prices for existing home sales continue to remain firm
despite that a little more inventory is coming on the market. There is slight concern however in that the
number of existing home sales declined by 1.2% in the month of June. Some experts
tend to think that the decline is due to rising interest rates for mortgage
financing however I don’t necessarily agree. This report is for the month of June
however mortgage rates did not jump until mid to late June which is actually late
in the month to have really impacted the June home sale totals The good news in the report is that existing
home sales are 15.2% higher than the same time last year.
More sellers these days are putting their homes on the market which is helping to ease what is still a noticeable lack of available home supply. The lack of supply is one of the reasons that home sales have not been quite as robust as we would think based upon demand. A big positive for home sellers is that houses aren't staying on the market very long at all, at 37 days in June versus 41 days in May.
More sellers these days are putting their homes on the market which is helping to ease what is still a noticeable lack of available home supply. The lack of supply is one of the reasons that home sales have not been quite as robust as we would think based upon demand. A big positive for home sellers is that houses aren't staying on the market very long at all, at 37 days in June versus 41 days in May.
A lack of distressed properties is one major reason behind
the tight housing supply. Home sales
related to distressed properties represented only 15 percent in the month which
is the lowest reading since this number has been tracked beginning in 2008.
Foreclosures only made up 8 percent of the month's sales.
The Federal Housing Finance Agency confirmed what we already
know about rising home prices. The most
recent report by the agency shows that home prices rose .7% in the month of May
and that prices overall are 7.3% higher than a year ago. This is a country wide average increase
however some parts of the country, especially the west coast, are experiencing
significantly higher increases in home values.
All indications are that the fundamentals for the future of
new homes sales is very strong.
Inventory is extremely low at 3.9 months at the current rate of
sales. The pace of new home sales are
actually at a post recovery high of 497,000.
The rapid run up of mortgage rates has eased and mortgage applications for home financing has appeared to have stabilized. Applications for home purchases declined 2.0% however that is more a reflection of home buyers temporarily pulling back from pulling the trigger on purchasing due to the recent jump in rates. Many home buyers that need mortgage financing are taking a short breather to see what is going to happen to rates in the coming weeks. Demand for housing remains very high. Refinance applications increase by 1%.
JJ Mack
916-517-1800
jj.mack@apmortgage.com
www.apmcroseville.com
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