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.
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