Susan Deierling, Assoc. Broker
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Realty Executives Northern Arizona
Tag Archives: Existing Home Supply
Home sales dropped last month, but not because demand was lacking. There are fewer homes for sale than at any time in the last 11 years.
According to the National Association of REALTORS®, Existing Home Sales for December 2012 fell to a seasonally-adjusted, annualized rate of 4.94 million homes from November’s tally of 4.99 million existing homes.
The Existing Home Sales report is based on the number of closings for previously-owned, single-family homes, townhomes, condominiums and co-ops. It’s estimated that existing homes account for 85 to 90 percent of all home sales nationwide.
2012 was a good year for housing. Sales of existing homes climbed 12.8 percent as compared to the December 2011 tally, which may be a strong indicator of future mortgage originations and short-term demand for home-related goods.
Based on preliminary sales figures, the number of home resales in 2012 grew 9.2 percent to 4.65 million homes as compared to 4.26 million homes sold during 2011. This marks the highest number of home resales sold in 5 years — a time which predates the recession of last decade.
In addition, the median price of a homes resale read $180,800 in December, which is a 11.5 percent increase as compared to December 2011, and the tenth consecutive month of year-over-year median price growth.
Not since November 2005 has the median home resale price climbed this quickly
Furthermore, the supply of existing homes fell to 4.4 months in December, down 0.4 months from November. At the current pace of sales, the national home resale inventory will be sold by June. This is an important statistic because home supply of less than 6.0-months is thought to represent a “seller’s market”.
There are also just 1.82 million existing homes for sale nationwide — the fewest since January 2001, and a 22 percent reduction from one year ago. With buyer demand high and home inventory down, home prices are likely to rise in Cottonwood and nationwide throughout 2013.
After a small decline in September, Existing Home Sales rebounded in October, increasing a modest 2.1%.
The housing market’s slow, steady recovery continues as sales volume in all four regions expanded last month with the exception of the Hurricane Sandy-affected Northeast.
The National Association of REALTORS® monthly Existing Home Sales Report comprises completed sales of single-family homes, townhomes, condominiums, and co-ops. The Existing Home Sales report is compiled on a seasonally-adjusted, annualized basis. It shows a 10.9 percent sales increase as compared last year.
Sales volume might otherwise be higher, however, if not for a lack of homes for sale.
Total housing inventory fell 1.4 percent to 2.14 million homes last month which, at the current sales pace, represents a 5.4-month national supply — the lowest in more than 6 years.
The lack of supply amid burgeoning demand has led home prices higher nationwide. October’s median existing home sale price was $178,600 — an 11.1% increase from October 2011 and the eighth consecutive month during which the median sales price rose.
The last time that occurred was during the eight months ending May 2006.
In addition, the Existing Home Sales report showed that the median time on market in October rose to 71 days, up 1 day from September 2012. As compared to October 2011, however, median time on market is down 26% from 96 days.
Other noteworthy statistics from the October Existing Home Sales report include :
- Foreclosures and short sales accounted for 24% of sales
- Foreclosures sold for an average discount of 20% to market
- Short sales sold for an average discount of 14% to market
Furthermore, thirty-two percent of homes sold in October were on the market for less than one month. 20% were on the market for six months or longer.
Record-low mortgage interest rates continue to spur housing, as do low prices. Neither will last indefinitely. If you plan to purchase a home in Cornville in 2013, therefore, consider moving up your time frame. Home ownership will likely increase in cost as the year moves on.
As the third quarter closed, home resales showed considerable momentum nationwide.
The National Association of REALTORS® reports Existing Home Sales at 4.75 million units in September 2012 on a seasonally-adjusted, annualized basis, an 11 percent increase from one year ago.
An “existing home” is a home that’s been previously occupied; a resale.
The reading marks the second-highest tally of the year — second only to August 2012 when 4.83 million homes were sold on a seasonally-adjusted, annualized basis. The real estate trade association reports that there are now just 2.32 million previously-occupied homes for sale nationwide.
It’s the thinnest national home supply since March 2005 and, at today’s sales pace, all 2.32 million homes would sell in 5.9 months.
A 6.0-month home supply is thought to represent a market in balance. September’s home supply, therefore, suggests a market which favors sellers. Buyers in many U.S. markets may have noticed this shift. Multiple-offer situations are increasingly common and “right-priced” homes are selling quickly.
The median Time on Market is down 31 percent from last year to 70 days nationwide.
Meanwhile, for purchasers of foreclosures and short sales, September Existing Home Sales report included interesting data on the relative value of buying “distressed” property :
- Foreclosures sold at an average discount of 21% to market value last month
- Short sales sold at an average discount of 13% to market value last month
And, although distressed homes remain a large part of the U.S. housing market, their relative size is shrinking.
In September, foreclosures and short sales accounted for roughly 1 in 4 home sales. Earlier this year, that figure was 1 in 3.
For today’s Sedona home buyer, September’s Existing Home Sales report may be a “buy signal”. With home supplies down and demand for homes rising, home prices are poised to increase through the last three months of 2012 and into the start 2013.
Home resales climbed 2% last month as the housing market continues its measured, steady recovery.
According to the National Association of REALTORS®, Existing Home Sales rose to 4.47 million units in July on a seasonally-adjusted, annualized basis.
An “existing home” is a home that cannot be classified as new construction and, despite a reduction in the national homes inventory, the number of previously-occupied homes sold in July was higher by 10% as compared to one year ago.
The Existing Home Sales also reported the folliowing :
- First-time buyers accounted for 34% of all purchasers, down from 34% in June
- Real estate investors accounted for 16% of all purchasers, down from 19% in June
- Cash buyers accounted for 27% of all purchasers, down from 29% in June
In addition, the real estate trafde group reports that distressed sales accounted for a smaller percentage of the overall home resale market in July. Just 24% of home resales were for homes in various forms of foreclosure or short sale.
This is down one percent from June, and five percent from July 2011.
It also marks the smallest percentage of homes sold in “distressed” status since the trade group began to track such data 4 years ago.
Lastly, nationwide, the supply of homes for sale dropped to 6.5 months. At the current pace of sales, therefore, the complete U.S. home resale inventory would be sold by the end of Q1 2013.
There are now 2.40 million homes for sale — a 24% reduction from July 2011.
For today’s Cornville home buyers, the July Existing Home Sales report reinforces the notion that housing is in recovery and what the nation’s home builders have been saying since late-2011 — the next six months for housing will likely be strong. Growth may not be linear, but it figures to be consistent.
With home inventory low and mortgage rates the same, the home resale market looks ripe for good deals.
Home resales slipped more than 5 percent last month, putting a damper recent housing market enthusiasm.
According to the National Association of REALTORS®, Existing Home Sales fell to 4.37 million units in June 2012 on a seasonally-adjusted, annualized basis. This is 250,000 fewer home sales per year as compared May’s figures which NAR has revised 2 percentage points higher.
The pace at which homes are selling has slowed, too. As compared to May, the Existing Home Supply rose 0.2 months. At the current pace of sales nationwide, the national home supply would now be exhausted in 6.6 months.
A home supply of 6.0 months is believed to mark a market in balance. There are currently 2.39 million homes for sale nationwide — the lowest total in 3 months and more than 24% below than the listed inventory at this point last year.
Other noteworthy statistics from the Existing Home Sales report include :
- First-time buyers accounted for 32% of all purchasers in June, down from 34% in May
- Real estate investors accounted for 19% of all purchasersin June, up from 17% in May
- Cash buyers accounted for 29% of all purchasers in June, up from 28% in May
In addition, distressed sales as a percentage of all sales was unchanged in June as foreclosures sold for an average discount of 18 percent below market value. Short sales nationwide sold at an average 15 percent discount.
More on “distressed sales” : In June, distressed homes accounted for 25% of all home resales, the smallest percentage of homes sold with such status since the real estate trade group began tracking the data in 2008.
Despite falling home sales and rising home supplies, however, home resales are expected to return to growth in July. Last month’s Pending Home Sales Index spiked to a 2-year high, and 80% of homes under contract close within 60 days. This portends well for July’s Existing Home Sales data, due in 4 weeks.
Low mortgage rates and rising rents in Cottonwood and in many U.S. cities continue to fuel the U.S. housing market. Home buyers should expect higher home prices ahead.
Home resales slipped last month; a slight setback for the nation’s housing market’s recovery.
According to the National Association of REALTORS®, Existing Home Sales fell to 4.55 million units in May 2012 on a seasonally-adjusted annualized basis, representing a 2 percent drop from April.
An “existing home” is a home that’s been previously owned or occupied, and cannot be categorized as new construction.
Despite May’s retreat, however, as compared to last year at this time, Existing Home Sales by units are higher by 10 percent. In other words, like everything else in housing, the long-term statistical trend has been a positive one.
The housing market has seen its bottom and is finding balance.
Other data from the Existing Home Sales report includes :
- First-time buyers accounted for 34% of all purchasers, down from 35% in April
- Real estate investors accounted for 17% of all purchasers, down from 20% in April
- Cash buyers accounted for 28% of all purchasers, down from 29% in April
In addition, distressed sales accounted for 25% of all sales in May, down from 28% in April.
“Distressed sales” include the sale of homes in various stages of foreclosure, and of short sales. This is the smallest percentage of homes sold in a “distressed” status since the real estate trade group began tracking the data in 2008.
And, lastly, home supplies rose by 0.1 months to 6.6 months nationwide in May. This means that, at the current pace of sales, the complete U.S. home resale inventory would be sold out before the end of 2012. A 6-month supply is widely believed to represent a market in balance between buyers and sellers.
There are now 2.49 million homes for sale — a 20% reduction from May 2011.
Home resales may have slipped last months but volume remains brisk nationwide. All-time low mortgage rates and high home affordability are keeping buyers in the market. Home prices are rising in many U.S. cities as the housing market continues its slow, steady recovery.
Low mortgage rates are helping to make homes more affordable. It appears home buyers have taken notice.
According to the National Association of REALTORS®, Existing Home Sales rose 3.4% in April from the month prior, registering 4.62 million homes sold on a seasonally-adjusted, annualized basis.
An “existing home” is a home that’s been previously occupied. April’s sales volume represents a 10 percent jump from April of last year.
For buyers and sellers in Cornville , the April Existing Home Sales report supports the notion that the housing market may be improving; that the “bottom” occurred sometime in late-2011. Home values have been rising in many U.S. markets and home builders now report the highest levels of foot traffic through models since 2007.
Demand for U.S. housing is growing.
It also helps that home affordability is at an all-time high. Not in recorded history have this many homes for sale been affordable to buyers earning a moderate household income, on a percentage basis. Additionally, there is now a larger stock of homes from which buyers can choose.
In April, the number of homes for sale nationwide jumped 9.5 percent to 2.54 million — the largest home resale inventory of the year.
At the current pace of sales, it would take 6.6 months for the complete home inventory to sell. Analysts consider a 6.0-month supply to be a market in balance. Anything less than a 6-month supply suggests a “buyer’s market”.
Home values peaked nationwide in April 2007. Since then, it’s been an uneven recovery. Some markets came back quickly, while others did not. On a neighborhood-by-neighborhood basis, even, there’s signifcant variance in how home values have fared.
In other words, although the April Existing Home Sales report indicates housing strength nationally, it’s the local data that matters most to today’s buyers and sellers. To get real-time real estate data for a particular street or area, talk with a local real estate agent.
In March, for the second straight month, home resales slipped nationwide.
According to the National Association of REALTORS®, March 2012 Existing Home Sales fell to 4.48 million units on a seasonally-adjusted annualized basis — a 3 percent drop from February.
An “existing home” is a home that’s been previously occupied or owned.
The weaker-than-expected Existing Home Sales data is the third such housing report this month to suggest a lull in the spring housing market. Earlier this week, homebuilder confidence slipped for the first time in three months and March Single-Family Housing Starts fell, too.
The news wasn’t entirely bad for home resales, however. Although total home units sold decreased, so did the number of homes available for sale. There were just 2.37 million homes for sale nationwide in March, a 2 percent drop from the month prior.
At the current pace of sales, therefore, the entire nation’s home resale stock would “sell out” in 6.3 months. This is the second-fastest pace since the housing market’s April 2007 peak.
A 6-month supply is widely believed to represent a market in balance between buyers and sellers.
The March Existing Home Sales data shows that — despite record-low mortgage rates nationwide — buyer activity in Sedona is slowing, and seller activity may be slowing, too.
So long as the two forces remain in balance, home prices should do the same. This is the law of Supply and Demand at work.
However, if home sales continue to slide and home inventory builds, buyers may find themselves with an edge in negotiations.
If you’re planning to buy a home in 2012, the long-term housing trend is still toward recovery. This season may be a good time to look at your options. Talk to your real estate agent to see what’s available. Low mortgage rates may persist, but low home prices may not.
The market for home resales stays strong.
Despite sparse home inventory, the National Association of REALTORS® reports that 4.59 million existing homes were sold in February on a seasonally-adjusted, annualized basis. An “existing home” is a home that cannot be classified as new construction.
Last month’s sales data represents a 9 percent improvement from the year prior.
There are now just 2.43 million homes for sale nationwide — a 19% reduction versus a year ago. The complete home inventory would “sell out” in 6.4 months at the current sales pace.
Some analysts believe that a 6-month home supply indicates a housing market in balance.
The real estate trade group’s report contained other noteworthy statistics, too :
- 32 percent of home sales were made to first-time buyers
- 33 percent of home sales were made with cash (i.e. no mortgage)
- 34 percent of home sales were of foreclosed homes or homes in short sale
In addition, nearly one-third of all home sales “failed” last month, the result of homes not appraising at the purchase price; or, the buyer’s inability to secure mortgage financing; or, insurmountable home inspection issues.
Even accounting for last month’s high contract failure rate,though, the Existing Home Sales report still posted its second-highest reading since May 2010. For today’s Cornville home buyer, the data may be a “buy signal”.
As compared to last fall, home supplies are down and home sales are up. Basic economics tell us that home prices should start to rise shortly — if they haven’t already. After all, the Existing Home Sales data is 30 days old, reporting on February. It’s nearly April today.
The good news is that homes remain affordable. With conforming and FHA mortgage rates in the low-4 percent range, home affordability is at its highest in history. Home prices may rise this spring, but at least your mortgage payment should remain low.
January’s home resales moved to a 20-month high — additional evidence that the nation’s housing recovery is underway.
According to the National Association of REALTORS®, the January 2012 Existing Home Sales showed 4.57 million units sold last month on a seasonally-adjusted, annualized basis — a 4 percent increase as compared to December’s revised figures.
An “existing home” is one that’s been previously occupied and cannot be categorized as new construction.
Beyond the headline numbers, though, there was plenty about which for today’s Sedona home sellers to get excited. Demand for homes remains strong, foreshadowing higher home prices through 2012.
First, the national housing stock is at a 5-year low.
In January, the number of homes for sale nationwide slipped to 2.31 million, the smallest home inventory since February 2007, and a 21% decrease from just one year ago.
Falling home supply amid constant home demand leads home prices higher. At the current pace of sales, today’s complete home inventory would “sell out” in 6.1 months.
Analysts say that a 6-month supply is a market in balance. Anything less is Bull Market territory.
Second, the National Association of REALTORS® says that one-third of all homes under contract “failed” last month. This means that many more buyers tried to buy, but couldn’t for a number of reasons including mortgage denials; or, insurmountable home inspections issues; or, homes appraising for less than the contract price.
As contract failures subside, Existing Home Sales are expected to rise even faster.
And, lastly, first-time buyers continue to power the home resale market. In January, 33% of all sales were made to first-time buyers, up four points from last year. This statistic suggests that renters are moving into homeownership, an important component in a sustained housing market recovery.
Given high demand and shrinking supply, we should expect for West Sedona home prices to rise in the coming months, if they haven’t already. Thankfully, mortgage rates remain near all-time lows.
Low mortgage rates make homes more affordable.