Despite the frictions related to obtaining mortgages, buyer interest remains solid. But inventory continues to shrink and that is limiting buying opportunities.
(PRWEB) July 22, 2012
The newest Homes.org monthly home sales report details data on June Existing-Home Sales provided by the National Association of Realtors®. The report analyzes key findings for existing home sales as well as forecasts for what buyers and sellers could possibly see in the months to come based on the market activity in June.
The June Existing Home Sales Report showed that supply and demand was once again a major factor in home sales. This reduction in inventory includes a drop in the number of distressed homes which helped to push prices up.
Key Findings in the June 2012 Existing Home Sales Report Include:
- 4.37 million existing home sales in June
- 5.4% less homes sold compared to May’s revised numbers of 4.62 million
- 4.5% higher than total home sales in June 2011
- Inventory was down 3.2% ending the month at 2.39 million
- Median existing home price increased to $189,400 for all types of homes
- Foreclosures and short sales accounted for 25% of the sales, down from 30% in June 2011
- 32% of home buyers were first-time buyers
- 19% of home buyers were investors
- 29% were all cash sales
Home sales in June fell across all four regions in the U.S. The Northeast experienced the largest decline in sales at 11.5%, followed by the West at 6.9%, the South at 4.4% and finally the Midwest with a decline of 1.9%. While the number of sales was down compared to last month, the median prices were up in all regions except the Northeast where they fell 1.8% compared to a year ago.
Top Factors Effecting Home Sales
- Tight Inventory Levels
- Home Affordability
- Record Low mortgage interest rates
- Less Distressed Homes Being Sold
"Despite the frictions related to obtaining mortgages, buyer interest remains solid. But inventory continues to shrink and that is limiting buying opportunities,” said Lawrence Yun, NAR chief economist. This lower inventory level paired with an influx of buyers has had a positive effect on prices. However, higher competition and less options means that first time buyers may have a more difficult time getting a home under contract.
While there has been a slight increase in sellers on the market, buyer activity has significantly outpaced it. Another reason for a reduction in homes for sale is the drop in delinquent mortgages. We’ll likely see these trends in buyer activity continue through the summer months since homes are still affordable despite the increase in prices and mortgage rates continue to remain at record lows.
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