What’s the status of the housing market?
According to an Associated Press story that we read on finance-commerce.com, “Americans bought more homes in June, the fourth straight monthly gain as the sales rate reached its highest level in more than nine years.” Other major excerpts from the AP article:
“The National Association of Realtors said . . . that sales of existing homes rose 1.1 percent last month to a seasonally adjusted annual rate of 5.57 million, the best performance since February 2007. Buyers are quickly making offers amid tight supplies of homes on the market, boosting prices as the traditional buying season reached its crescendo. The solid job market and mortgage rates near historic lows have kept demand steady, even though the number of listings on the market has dropped.
“But continued sales gains appear to be limited this year because of the acute shortage of listings. The meager supplies have fueled price growth that has eclipsed wage gains while forcing buyers to either save more for down payments or borrow more heavily. The result is that sales likely peaked in June, as data from the Realtors show the pace of signed contracts and open house visits have slipped.
“Sales rose in the Midwest and West last month, while staying unchanged in the South and slipping in the Northeast.
“The median home sales price was $247,700 in June, up 4.8 percent from a year ago. That increase is roughly double the pace of average hourly wage gains. The median home sales price for new and existing homes in the Twin Cities area was $242,000 in June, according to the Minneapolis Area Association of Realtors. That price was up 5.3 percent from last year.
“Individual investors are retreating from the housing market, being replaced by first-time buyers. First-timers comprised 33 percent of June sales, their highest share of the market in four years.
“Despite the improving prices, the number of listings on the market has fallen over the past year. Many homeowners are still rebuilding equity that vanished when the housing bubble began to burst almost a decade ago. Even though prices are within striking distance of their peaks, these homeowners would be unable to generate enough of a profit from a sale to pay for the expense of purchasing a new home.
“The number of listings has fallen 5.8 percent from a year ago to 2.12 million. Listings in the Twin Cities area were down 18.2 percent from 12 months ago, according to MAAR.
“Many current homeowners are choosing to update their current properties, a possible sign of either their desire to stay put or their plans to list the property for sale in the future. Interest in bathroom and kitchen renovations has picked up this year, according to an index released . . . by the remodeling firm Houzz based on the business seen by architects, interior designers and contractors.”