Reviewing Sales Figures from August Data
For-sale inventory of single family homes, condos, townhomes and co-ops remain at historic lows while median home prices have declined on a monthly basis yet remain higher than a year ago, according to data released by Realtor.com.
The Monthly Housing Summary from Realtor.com reported that there were 1.84 million units for sale in August 2012, which represents a -18.68% drop compared to a year ago.
The summary also showed that the median list price in August $190,000, down -2.51% on a monthly basis but marginally higher (+0.05%) than a year ago.
These facts and figures suggest that the recovery process is indeed underway; however, it may still be too soon to declare a full recovery has occurred. The recovery, which began last year in Florida and has since spread west, has continued to build momentum in August showing impressive price gains in some of the hardest-hit metros, including Phoenix, AZ; Boise City, ID; Seattle, WA and Reno, NV.
The bad news is that more industrialized areas are showing signs of weakness as the gains posted earlier in the year are beginning to taper off. This shows that the market may be back on its feet but it’s yet to take a steady footing.
Here’s a quick look at a few metros and their respective housing data from Realtor.com’s Monthly Housing Summary:
Median List Price: $189,900
Total Listings: 55,291
Median Age of Inventory (days listed): 97
Median List Price: $174,900
Total Listings: 41,419
Median Age of Inventory: 71
San Francisco, CA
Median List Price: $725,000
Total Listings: 3,323
Median Age of Inventory: 46
Median List Price: $159,000
Total Listings: 2,056
Median Age of Inventory: 111
To see the entire summary, visit this link: http://www.realtor.com/data-portal/Real-Estate-Statistics.aspx
Housing Recovery Predictions – Room for Improvement?
The housing market may be getting back on track, but experts say there’s still plenty of room for improvement.
With home prices posting their strongest gains in six years and homes with negative equity on the decline, the U.S. is finally getting some clear signs that many housing markets have hit bottom and are climbing their way back up. Be that as it may, mortgage and real estate professionals say the housing market is remains far from normal.
According to a recent article by Nick Timiraos of the Wall Street Journal, the rising home prices have less to do with a sudden surge in demand than they do with a shrinking inventory of homes for sale. Existing homes are apparently getting few and far between, reaching an eight-year low, according to the article.
Essentially, there are more buyers than there are available homes for sale. The inventory of discounted and distressed properties like foreclosures has also shrunk. Timiraos explains that recent price gains have been concentrated in the lower end of the market, which has suffered the biggest inventory shortage. This would explain the sudden rise in home prices but Timiraos warns readers not to confuse hitting bottom with a full recovery – which, he predicts, is still a far way off.
Several hurdles have to be cleared in order to declare a full on recovery, according to Timiraos. One thing is for sure, more Americans need to eliminate their negative equity. Millions of homeowners still owe more than their homes are worth, making it an unwise choice for them to sell and nearly impossible for them to refinance. According to data from CoreLogic, about 45% of all American homeowners with a mortgage have less than 20% in equity. Without decent equity, selling a home for enough money to make a down payment on a comparable home is tough. That’s why so many people are reluctant to sell now.
Another challenge lies in the banks’ credit requirements. Timiraos explains that without enough people to qualify for homeownership, the market will remain sluggish.
Once these issues are resolved, we may finally see some real improvement. Until then, U.S. homeowners or would-be homeowners will need to make their financial decisions carefully. It’s not all bad news, though. Mortgage rates are still incredible low and accommodating home loan programs such as FHA mortgages and HARP refinancing are continuing to spark housing activity.