Pending Home Sales Remain Strong In June

The National Association of REALTORS’ Pending Home Sales Index is “a forward-looking indicator based on contract signings”. The higher the Pending Home Sales Index number, the more contracts have been signed by buyers that will soon translate to sales. The latest index was released last week, with the headline: Pending Home Sales Dip in June As we reported last month, May’s Index levels were the highest recorded in the last 9 years. The small 1.8% decline from May remains 8.2% over last June and the third highest reading in two years. The NAR headline, while accurate, isn’t the best representation of what really happened. NAR’s Chief Economist Lawrence Yun points towards “low inventory levels in many markets” leading to “reduced choices” at higher price points for the small decline in National Pending Home Sales. In every major region of the country, pending sales are up year-over-year as shown by the graph below: Yun goes on to say that there needs to be a signifi
http://www.homesforsaleinarlingtontx.org/pending-home-sales-remain-strong-in-june/

Homeownership: The Real Story Behind The Headlines

The big housing news this week is that the home ownership rate has dropped to 63.4% which represents the lowest rate in 48 years. That news definitely is making headlines. Yet, to fully understand what this means we have to look at the story that created these headlines. There is no doubt the home ownership rate has declined since the housing crisis. Here is a graph showing the home ownership rate over the last twenty years. It skyrocketed during the housing boom and has steadily fallen since the bust: The story behind the headline… The dramatic fall in the rate over the past year must be looked at very closely. The rate is determined by the “number of households” who rent versus those who own. Let’s assume you have nine friends that live on their own (thus forming a household); six of them own and three of them rent. That would mean that 66.6% (6 out of 9) of your friends that live on their own are homeowners. Now, let’s assume you have another friend who has been living wi
http://www.homesforsaleinfortworthtx.org/homeownership-the-real-story-behind-the-headlines/

Are Home Values REALLY at Record Levels?

Last week, the National Association of Realtors (NAR) released their Existing Home Sales Report. The report announced that the median existing-home price in June was $236,400. That value surpasses the peak median sales price set in July 2006 ($230,400). This revelation created many headlines exclaiming that home prices had hit a “new record”: Wall Street Journal: Existing-Home Prices Hit Record USA Today: Existing home sales surge, prices hit record Though the headlines are accurate, we want to take a closer look at the story. We do not want people to believe that this information is evidence that a new “price bubble” is forming in housing. NAR reports the median home price. That means that 50% of the homes sold above that number and 50% sold below that number. With fewer distressed properties (lower valued) now selling, the median price will rise. The median value does not reflect that each individual property is increasing in value. Below are the comments from Bill McBride,
http://www.homesforsaleinirvingtx.net/are-home-values-really-at-record-levels/

Buyer Demand Continues To Outpace Housing Supply

The price of any item is determined by the supply of that item, and the market demand. The National Association of Realtors (NAR) recently released their latest Existing Home Sales Report. Inventory Levels & Demand Sales of existing homes rose 3.2% from May, outpacing year-over-year figures for the ninth consecutive month. Total unsold housing inventory is at a 5.0-month supply. This is down from May’s 5.1-month supply and remains below the 6 months that is needed for a historically normal market. Consumer confidence is at the highest level in over a decade. Pair that with interest rates still around 4%, new programs available for down payments as low as 3%, and you have an attractive market for buyers. Buyer demand for housing surged to it’s highest level since June 2013. Prices Rising June marked the 40th consecutive month of year-over-year price gains as the median price of existing homes sold rose to $236,400 (up 6.5% from 2014). So What Does This Mean? The chart below shows t
http://www.homesforsaleinarlingtontx.org/buyer-demand-continues-to-outpace-housing-supply/