National Housing Market Update

From the National Association of Realtors comes the following information. Of course all real estate is local as they say, but national trends affect us as well. I provide local trends as well, so you may look under the statistics category for past postings and tune back in often for new updates.

October 2011  Market Update Despite some pessimism pertaining to the global and domestic economies, the U.S. housing sector continues to show promising signs of stability and growth. Low levels of new home construction and gaining sales volume fueled by an inventory of affordable housing since Richard Nixon was president have reduced the number of homes on the market. This means home prices may begin to appreciate again. While there are many factors that can be barriers to buying a home, such as the tightening of mortgage lending rules by banks, consumer confidence in the job market is among one of the top obstacles to home ownership. In the 2011 Housing Pulse Survey conducted by the National Association of Realtors, 80% of respondents cited job security as their primary concern when deciding to buy. For only the fourth time since the beginning of 2010, home sales in August were up both year-over-year and month-over-month, posting an 18.6% gain from last year, with first-time home buyers accounting for nearly a third of all homes purchased.  These indications of strength in the housing market may help to add to consumer confidence, which is an integral part of sustained growth. Even though there is still a long road to recovery ahead of us, there are opportunities to be had for both home buyers and sellers.   Home Sales in millions August home sales were up 18.6% year-to-year, posting a 7.7% increase in sales activity over July despite Hurricane Irene, which struck the Eastern seaboard and New England regions at the end of the month. As a result of the hurricane, the Northeast experienced the smallest increase in sales. At the same time, persisting restrictions among banks affecting home lending are having the greatest constraint on sales levels. NAR Chief Economist Lawrence Yun stated, "The market can easily move into a healthy expansion if mortgage underwriting standards return to normalcy."           Home Price in thousands Homes prices were down, with a 5.1% drop in August compared to a year ago. The national median price for homes in August was $168,300, with distressed properties, foreclosures, and short sales still accounting for 31% of sales. The buyer's market for residential property continues, as favorable prices, and record low interest rates offer the most affordable conditions for purchasing a home in the last 40 years.             Inventory- Month's Supply in months The supply of homes measured in months on the market at their current pace of sales fell 10.5% in the month of August, to an 8.5 month supply of inventory, down from a 9.5-month supply in July. With homes being more affordable than they have been in a generation and the lowest levels of new home construction since World War II, this inventory is projected to continue to fall, which will eventually result in the appreciation of home prices and a move toward a balanced market.           Source: National Association of Realtors