How’s housing market? New numbers shed light
Updated: June 21, 2012 11:55AM
How’s the market? That’s the million-dollar question on both homebuyers’ and homesellers’ lips these days.
It’s not always an easy question for Realtors to answer amidst the ebb and flow of correcting economies, but new facts and figures are helping. Here’s a round-up of realty-related developments that better qualify what is happening in the current market in varied segments.
Existing home sales, according to a late May report from the National Association of Realtors, rose 3.4 percent month-to-month, and an encouraging 10 percent year-over-year. April’s overall housing inventory supply fell to 5.1 percent, with sales up in the Midwest, Northeast and West, though down in the South.
New home sales rose 3.3 percent month-over-month in April to a seasonally adjusted rate of 343,000, according to a mid-May report from the Commerce Department and HUD. New home sales were up 9.9 percent from April 2011, the seventh straight month of year-over-year increases. The government also reported that the national average price of a new home was up over 5 percent from a year before.
Ready, qualified buyers remain limited. The National Association of Home Builders released a spring survey which showed buyer traffic for new homes had fallen in April to its lowest level in four months, and sales, though higher than before, still lagged behind the pace of construction. On the upside, lower supplies have started to tweak early-buyer demand in new construction projects already underway. A Capital Economics’ report noted that new homes are being sold earlier in the construction process, with 58 percent of new homes this spring sold with the ground not yet broken or while under construction.
In the Chicago metro area, there are additional positive signs for the overall market, according to a May market update report released by Michael Pierson, President and Chairman of Prudential Rubloff. In it, he notes that the local market is seeing significant signs of improvement, with year-to-date contract pending figures through April up 18% in volume and 33% in unit sales compared to the same time last year.
Pierson noted, “In certain segments of the market, we have begun to see inventory shortages and multiple offers. In fact, many of our agents are reporting that this is the most active they have seen the market in five or six years.”
Progress is nonetheless tempered by many economist reports that a full housing recovery could still take several years. For example, one economist report from IHS Global Insight projects home sales to rise incrementally in 2012 -- but they do not see a full housing recovery until 2015.
According to Pierson, “Sellers would still be well-advised to price conservatively ... We’ve said it before and It still holds true. We’re in a price war and a beauty contest.”
Julie Morse is a real estate agent in Illinois and Wisconsin.