Tag: Home Sales Statistics

The National Association of realtors reported Thursday that existing home sales fell by 1.5 percent in May, as prices surged nearly 8 percent to their highest levels since June 2010. The report indicated that homes sold at a seasonally adjusted annual pace of 4.55 million units, just below the consensus estimate of 4.57 million projected by economists in a recent Bloomberg survey. While still well below the pace of 6 million units sold which economists view as indicative of a healthy market, the pace of existing home sales has recovered substantially since setting a post-recession low of 3.39 million units in July 2010. The highest sales pace ever for existing homes was 7.25 million, reached in September 2005, before the nation’s worst downturn since the 1930s.

The total inventory of previously lived in homes on the market fell 0.4 percent from April to May to 2.49 million. AT last month’s rate of sales, that inventory would take 6.6 months to sell out, up from the 6.5 months it would take to sell April’s inventory at that pace. A bright spot in the NAR’s report on Thursday was that sales picked up in the Midwest, but that was about it as sales slipped in the other three regions, led by a decline of 4.8 percent in the Northeast. Cash transactions continued to account for a large portion of sales last month, at 28 percent, as foreign investors continued to snap up cheaply prices homes in the US. The percentage of first-time buyers, meanwhile, was 34 percent, well below the range of 40 to 45 percent associated with a healthy housing sector. While record-low interest rates and steeply discounted properties have created some of the most affordable homebuying conditions in history, the continuous flood of foreclosures is weighing on the market by driving prices down and increasing inventory.

Foreclosures had slowed considerably over the last 16 months while lenders negotiated settlements over allegations of improper foreclosure practices, but foreclosure starts picked up for the first time in that span last month, suggesting the foreclosure pipeline is about to be reopened.

The National Association of Realtors reported Thursday that fewer Americans signed contracts to purchase homes in August despite interest rates near historic lows. The report is further evidence of the challenges facing policymakers as they try to help boost the struggling housing market. The NAR’s pending home sales index, which is based on contracts signed to buy homes in a given month, fell 1.2 percent in August to a reading of 88.6, its lowest level since April.

While a decline is still a decline, the drop last month was smaller than expected, as analysts taking part in a recent Reuters poll projected pending sales would fall by 1.8 percent, on average. And, analysts believe that Hurricane Irene, which battered the East Coast toward the end of the month, halting nearly all economic activity, including house hunting, played at least some part in the slowdown. The NAR’s data support that assertion, as pending sales in that region fell by a whopping 5.8 percent.

Also holding back improvement in the housing market, NAR chief economist Lawrence Yun says, is an unwillingness of banks to ease lending standards that were tightened after the economic collapse. Bad mortgages bundled into securities and then sold as investments contributed heavily to the financial collapse in 2007, and banks responded by raising minimum credit score and down payment requirements for mortgages.

Last week, the Federal Reserve took action to stimulate activity in the housing market by launching Operation Twist, a program designed to keep long-term interest rates low. As a result of the program, mortgage rates fell to their lowest levels on record this week, and analysts believe they will go even lower in the coming weeks.

The National Association of Realtors reported Wednesday that contracts to purchase existing homes rose in May to their highest level in nearly two years, the latest in a series of positive indicators for the long-beleaguered US housing market. The NAR’s pending home sales index rose 5.9 percent last month to a reading of 1.1.1, exactly matching the index’s level since the expiration of the home buyer tax credit two years ago. The reading also represents a gain of nearly 13.3 percent on last year’s reading.

The rise in pending home sales is just the latest in a series of positive housing indicators, including new home sales reaching a two-year high, according to the Commerce Dept and the first increase in home price since the Fall, according to a report from Standard & Poor’s/Case-Shiller. Pending home sales gained in each of the four US regions, fueled by a gain of nearly 15 percent in the West. In year-to-year terms, pending sales rose 22 percent in the Midwest, 20 percent in the Northeast, 12 percent in the South and 5 percent in the West. Of course, despite recent improvements, the housing sector is still well below pre-recession levels, with sales and prices down by about a third since late 2007.

NAR chief economist Lawrence Yun indicated in a statement that he expects existing home sales to rise 9 to 10 percent this year and sees the median sales price for existing homes rising 3 percent this year and 5.7 percent in 2013. The median existing price has fallen at a faster rate than other home price measures because of the changing mix of homes included. In May, for example, distressed properties accounted for just a fourth of all existing homes sold, the lowest proportion since 2008.

The Commerce Department reported on Thursday that new home sales fell 2.1 percent last month as activity slowed way down in the Northeast. The agency said that new home sales fell to a seasonally adjusted annual pace of just 319,000 in May, ahead of the 310,000 rate analysts taking part in a recent MarketWatch survey had projected. April’s figures were also revised upward from a pace of 324,000 to 326,000.

The Northeast contributed heavily to the national decline in new home sales, with a drop of almost 28 percent, offsetting a 2.5 percent increase in the nation’s largest region, the South. The Midwest saw an unchanged pace of new home sales, while the West experienced a 3.5 percent decline.

New home sales are a traditionally volatile category, with a plus / minus margin of 10.7 percent, but May’s data fits within the range of 278,000 to 331,000 over the past twelve months. Sales have trended modestly higher over the last few months, with sales climbing about 8 percent between the first and second quarters.

Despite the upward trend, the new home sales market is still very much depressed. As the nation entered its worst recession since the 1930s in December 2007, new home sales were at a pace of 641,000, and during the housing boom in July 2005, the pace was 1.39 million. New home sales are struggling because of a variety of factors, including continued weakness in the nation’s job market, a high percentage of underwater homeowners, and a continued wave of inexpensive distressed properties with which new homes must compete.

The U.S. Commerce Department announced this week that sales of single-family homes unexpectedly increased in April, offering some optimism for the long-beleaguered national housing market. The report showed a surprising in crease in home values as well. The agency’s seasonally adjusted index rose 7.3 percent for the month to a pace of 323,000, the highest pace of sales reported since December. It was the second straight month that sales increased, after the agency revised March’s pace up to 301,000.

Analysts in a recent survey conducted by Thomson Reuters had forecast that sales would remain unchanged from the previously announced pace of 300,000 for March. Sales increased across the nation. Led by a 15.1 percent gain in the West. Sales are still lower on a year-to-year basis, at just over 23 percent below last April’s pace, when the housing market was still getting a boost from federal tax credits for home buyers. While economists certainly welcomed the optimistic report, most are not trumpeting the news as evidence the market is nearing a bottom.

Separate reports over the last few weeks on everything from industrial production to consumer spending suggest the overall economy is still struggling to gain a foothold in recovery. Manufacturing activity dipped in May after seven straight months of growth, and the Commerce Department’s report on economic growth in the first quarter disappointed analysts.

A large oversupply of homes listed for sale continues to apply pressure to values, with thousands of foreclosures set to hit the market, bringing prices down even further. These foreclosures and bloated inventory are hindering demand for new homes and slowing new home construction, which usually plays a pivotal role in the economy recovering after a downturn. Economists estimate that every new home built generates at least $90,000 in tax revenue while also creating an average of three new jobs for a year. There were just 175,000 new homes on the market in April, the lowest such figure ever reported and a 2.8 percent dip from the March figure.

While new homes sales rose slightly in April, sales of existing homes fell, as did construction of new homes. The Commerce Department reported that the median sales price for a home purchased in April was $218,000, 1.6 percent higher than the March median but 4.6 percent down from a year ago. At April’s sales pace, there was a 6.5 months supply on the market, the lowest since the same month in 2010, and down from March’s supply of 7.2 months.

After seemingly reaching a bottom early in 2009, home values in Santa Clara and San Mateo counties have now dropped again in what some economists see as a double dip, raising new concerns about the strength of the housing market. Home values have now fallen 25.2 percent from their April 2006 peak in Santa Clara, while San Mateo prices are 24.2 percent below peak levels.

A double dip is when prices fall again shortly after recovering from a previous drop. The latest drop in home values began around the middle of 2010, when federal and state tax credits for homebuyers expired. The tax credits fueled demand by convincing many people to buy homes sooner than they otherwise might have. Their expiration left a reduced number of buyers in the second half of the year, leading to a slowdown in sales which in turn drove prices down.

But a number of realtors believe sales and prices are about to begin climbing. Zillow also reported that the number of so-called underwater homeowners, or those who owe more on their loans than their home is worth, is up in the two counties, after having fallen in 2010’s third quarter. Zillow also says that California experienced a double dip in home prices in the final quarter of 2010, but expects a recovery in prices over the next few months.

The National Association of Realtors on Tuesday reported that sales of existing US homes in October were lower than forecast as the housing market was held in check by foreclosure moratoriums and strict lending standards.

The NAR’s report showed that sales of existing homes fell 2.2 percent to a seasonally adjusted annual pace of 4.43 million units, compared to a pace of an annual rate of 4.53 million in September. Economists participating in a recent Bloomberg News survey had forecast a median pace of 4.48 million units. The median sales price in October was also down, by .9 percent as compared with October 2009.

Economists are concerned that continued high levels of unemployment and a glut of unsold inventories will restrain sale sin the struggling US housing market, even as mortgage rates at or near historic lows limit the damage. Predictions of the 71 economists surveyed by Bloomberg ranged from 3.85 million to 4.7 million. The pace in July was 3.84 million units, the weakest ever in the ten year history of the NAR homes report.

Colorado Springs Condo Sales

A separate report on Tuesday indicated that the overall US economy grew at a 2.5 percent rate in the third quarter as consumer spending and business investment both grew. The figure was revised upward from a 2 percent estimate in October, and compares with a growth rate of 1.7 percent for the US economy in the second quarter. The Commerce Department report also showed that corporate profits grew in the quarter at a slower-than-expected pace.

Stocks remained at lower levels after sustaining earlier losses on mounting tension between North and South Korea, as well as growing concern about the possible spread of the European debt crisis. The S&P 500 fell 1.2 percent to 1,183.04 as of about 10:30 AM ET. Treasury securities edged higher, sending the yield on the benchmark 10-year note down to 2.74 percent from 2.80 percent late Monday.

Without adjusting for seasonal variations, sales of existing homes were down 28 percent from the same time last year. The report showed sales dropped in all four regions, led by a 3.4 percent decline in the South. The median sales price was also down, from $172,000 in October 2009 to $170,500. Sales of existing, single-family units fell 2 percent from a year ago to an annual pace of 3.89 million.

The number of existing US homes on the market fell 3.4 percent to 3.86 million. At the current pace of sales, it would take 10.5 months to exhaust that supply, compared to 10.6 months in September. Economists say that a supply of about 8 months or less would be required to stabilize prices in the struggling housing market.

The percentage of foreclosure sales and other distressed properties was about 34 percent of total sales in the month, about the same level it’s been for a number of months. Economists partially attribute the October drop in sales to foreclosure moratoriums, as well as lenders’ tighter qualifying criteria for borrowers.

In a sign that the US housing market will likely take some time to recover, sales of existing homes surprisingly plummeted in September, according to the National Association of Realtors’ index of pending homes resales released Friday.

The report showed sales fell by 1.8 percent in the month, following a revised 4.4 percent gain in August. Compared with September 2009, sales are down a staggering 25 percent. Progress is being limited, industry insiders say, by moratoriums on foreclosures and tighter lending criteria.

Sales have somewhat steadied, however, since the expiration of federal homebuyer tax credits in April sparked a dramatic 32 percent plunge in the data. Though mortgage rates are at or near record-lows, prices are being held down by continued high levels of foreclosures and the nation’s unemployment rate of 9.6 percent is buffering demand.

A report from the Labor Department on Friday indicates that the nation’s employers may finally be ready to increase hiring. US payrolls increased by more than 150,000 in October, according to the report, far exceeding estimates of even the most optimistic analysts. The report also indicated workers are getting more hours and earnings are up, on average, as well.

Treasury notes fell and the US dollar strengthened on the report. The yield on a ten-year Treasury, which adjusts inversely to its price, climbed 2.53 percent by mid-day Friday from 2.49 percent at the end of Thursday’s session. The dollar, meanwhile, rose from $1.4207 per euro late Thursday to $1.4062 in the middle of Friday’s session.