There are a lot of things about a house that might cause a potential buyer to decide against it. Maybe it’s a great house but in the wrong location or it needs more work than they’re willing to do. In some cases, it might just be a bad fit for their lifestyle, needs, or budget. That’s why the typical buyer looks at least a handful of houses before deciding to make an offer on one. In this market, though, buyers may have to be more flexible. That’s because, the number of homes available for sale is lower than normal. In fact, according to new data from the National Association of Realtors’ consumer website, the number of new listings is between 17 and 21 percent lower than last year at the same time. And nationally, housing inventory is down 27.4 percent. Danielle Hale, the website’s chief economist, says new listings have improved but buyer demand is outpacing supply. “Our June data reinforces that buyers are out in force and serious about finding a home,” Hale said. “Although the new listings trend has improved, inventory continues to decline, indicating that what is coming onto the market is selling.” (source)
Archive for July 2020
Mortgage Rates Fall To Another Record Low
According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell to another record low last week, with rates down for 30-year fixed-rate loans with both conforming and jumbo balances. Rates for loans backed by the Federal Housing Administration were up from the week before. But despite favorable rates, demand for mortgage applications dropped 1.8 percent. Joel Kan, MBA’s associate vice president of economic and industry forecasting, said it was the second consecutive week purchase application demand declined. “After two months of strong growth, purchase applications declined for the second week in a row,” Kan said. “The weakening in activity is potentially a signal that pent-up demand is starting to wane and that low housing supply is limiting prospective buyers’ options.” But while demand was down week-over-week, refinance and purchase activity are both still up from last year. In fact, refinance demand is 74 percent higher than year-ago levels, while demand for loans to buy homes is up 15 percent. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)
Home Price Report Finds Values Stable
Naturally, home prices are the housing market data most important to potential home buyers and sellers. Before mortgage rates, inventory, time on market, or any other measure, buyers and sellers want to know where prices are and where they’re headed. This makes sense, after all. If you’re selling a house, you want to get the best price. And, if you’re buying one, you also want to get the best price. That’s why the S&P Case-Shiller Indices are closely followed. Considered the leading measure of U.S. home prices, the index has been keeping records for more than 27 years. According to the most recent release, prices remain steady, with small increases seen both month-over-month and annually. Craig J. Lazzara, managing director and global head of index investment strategy at S&P, says home values have been remarkably stable, despite the economic turmoil caused by the coronavirus. “April’s housing price data continue to be remarkably stable,” Lazzara said. “The National Composite Index rose by 4.7 percent in April 2020, with comparable growth in the 10- and 20-City Composites (up 3.4 percent and 4 percent, respectively). In all three cases, April’s year-over-year gains were ahead of March’s, continuing a trend of gently accelerating home prices that began last fall.” (source)
