The national housing market continues to recover, indicated by a balanced supply of inventory and increasing home prices across the country. NAR President Moe Veissi states, “The very favorable market conditions are helping to unleash a pent-up demand, which is why housing supplies have tightened and are supporting growth in home prices.”

However, rising demand has led to tight supplies of affordable homes for first-time home buyers, who now only represent 32% of purchasers. NAR Chief Economist Lawrence Yun claims “a healthy market share of first-time buyers would be about 40%, so these figures show that tight inventory in the lower price ranges, along with unnecessarily tight credit standards, are holding back entry-level activity.”

Regardless, with the market heating up and mortgage rates continuing to hit record-lows, now is one of the most favorable times in history to buy a home.

Home Sales

in millions

While home sales declined 5.4% from last month to 4.37 million units, year-over-year sales increased 4.5%. Distressed homes (which include short sales and foreclosures that traditionally sell for 15%–20% less on average compared to non distressed homes) allotted for 25% of June sales, which is unchanged from May, but is 30% below year-ago sales. However, despite the declining levels seen from past years, it is still expected that distressed property sales will still be largely present and higher than the historic average.

Home Price

in thousands

Shrinking inventory and a decline in distressed properties on the market continue to drive home prices up. The median home price rose 5% from last month, and 7.9% compared to a year earlier to $189,400. This is the fourth consecutive month of year-over-year price gains, which hasn’t been seen since February to May of 2006, a period of peak performance in the housing market.

Inventory- Month’s Supply

in months

Housing inventory fell another 3.2% in June to a current 2.39 million homes available for sale, a 6.6-month supply. This marks the seventh consecutive month of inventory at a 6-month supply, the threshold for a balanced market, giving both buyers and sellers an equal advantage. Movement out of the three-year buyer’s market is imperative toward reaching a full-scale housing market recovery.

Interest Rates

Mortgage rates at or around 3.53% continue to drop and boost home affordability. These are some of the lowest rates on record since 1971, increasing the urgency to buy now.

This Month’s Video

Topics For Home Owners, Buyers & Sellers

With many markets heating up, home prices are rising and inventory is shrinking. This high market activity puts sellers at a strong advantage, but to ensure that your property sells quickly and for the highest price, here are some tips to turn that “For Sale” sign into a “Sold” sign:


 

Brought to you by KW Research. For additional graphs and details, please see the This Month in Real Estate PowerPoint Report.
The opinions expressed in This Month in Real Estate are intended to supplement opinions on real estate expressed by local and national media, local real estate agents and other expert sources.  You should not treat any opinion expressed in This Month in Real Estate as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion.  Keller Williams Realty, Inc., does not guarantee and is not responsible for the accuracy or completeness of information, and provides said information without warranties of any kind.  All information presented herein is intended and should be used for educational purposes only.  Nothing herein should be construed as investment advice.  You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.  All investments involve some degree of risk.  Keller Williams Realty, Inc., will not be liable for any loss or damage caused by your reliance on information contained in This Month in Real Estate.

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