I consider myself a glass half full individual and always look for the bright side in everything, I found myself this week struggling to find housing news that would be positive for my friends.
Heading into this week I was very optimistic about the numerous housing reports to be delivered only to be disappointed. The first housing report of the week, existing homes shows that sales are yet to recover from the Federal Reserve’s decision last year, to begin tapering the economic stimulus program.
For the seventh time in eight months, sales of existing homes declined. For the month of March sales dropped 0.2 percent in March to an annual rate of 4.59 million. More concerning is that sales of existing homes are down 7.5 percent from the same time last year.
This is the steepest rate of sales contraction since May 2011. Weather does not seem to be a factor for dismal report.
Don’t miss a thing. Get breaking Santa Clarita news alerts delivered right to your inbox.
Higher mortgage rates, although still very affordable, are considered one of the reasons for the sales weakness. The other more significant factor is the higher home prices that exist because of strong housing demand with very limited available inventory.
Where sales are down from the same time last year, home prices for existing homes are up 7.9 percent.
According the Federal Housing Finance Agency the housing market continues to improve in terms of home prices appreciation. The FHFA reported that home prices are up 0.6 percent for the month of February. This rise follow a 0.3 percent gain for January.
The one positive influence rising home prices is having is that consumer confidence is growing and real estate values seems to be the catalyst.
The biggest negative of the housing reports this week is the data on new home sales. New home sales plummeted 14.5 percent in March. The report is far below most analyst’s expectations and is raising new concerns for near future trend of new home sales. Prices once again seem to be the arguable culprit.
The cost of building materials continues to rise as well as demand for new construction. These combined forces are placing significant upward pressure on home prices which ultimately impacts home affordability.
Do you have a news tip? Call us at (661) 298-1220, or drop us a line at email@example.com.
Next week the potential market reports are:
- Monday April 28th – Pending Home Sales
- Tuesday April 29th – S&P Case-Shiller Home Value Index
- Wednesday April 30th – MBA Applications, ADP Report, GDP & FOMC Announcement
- Thursday May 1st – First Time Jobless Claims
- Friday May 2nd – National Employment Report
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends. I welcome the opportunity to serve you in any way I possibly can. Please feel free to reach me at 661-505-4300.
Source: Santa Clarita News