The week’s housing market news
Mortgage Rates
The national 30 year Fixed Rate Mortgage (FRM), as reported by Freddie Mac, was 4.06%, down a fraction from 4.07% the previous week. We are in contact with a lender who is offering 30 year FRMs with zero points at just under 4%, with 15 year mortgages at 3.5%. These rates are valid for loans up to $2 million.
The chart below shows the FRM since the beginning of 2018 and demonstrates that mortgage rates have declined from almost 5% in late 2018 to the same level as at the start of 2018.
Existing home sales
Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – fell 0.4% from March to a seasonally adjusted annual rate (SAAR) of 5.19 million in April. Total sales are down 4.4% from a year ago (5.43 million in April 2018). The SAAR has been mostly in the range of 5 – 5.5 million for the last few years.
The median existing single-family home price was $269,300 in April, up 3.7% from April 2018.
Total housing inventory at the end of April increased to 1.83 million, up from 1.67 million existing homes available for sale in March and a 1.7% increase from 1.80 million a year ago. Unsold inventory is at a 4.2-month supply at the current sales pace, up from 3.8 months in March and up from 4.0 months in April 2018.
Here is a set of 8 slides with highlights from this month’s report: Existing home sales in April.
New Home Sales
New home sales for April were reported at 673,000 on a seasonally adjusted annual rate basis (SAAR). Sales for March were revised up to 723,000, a new high for this cycle. Sales in January and February were also revised up.
Sales of new homes are notoriously volatile and subject to significant revisions but according to Bill McBride of Calculated Risk “New Home Sales appears to be an excellent leading indicator, and currently new home sales (and housing starts) are up solidly year-over-year, and this suggests there is no recession in sight.”
The supply of new homes was 5.9 months, close to the 6 months which is regarded as being a market in equilibrium between buyers and sellers.
Here is the full New residential Sales April 2019 report.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
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Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty Affiliates LLC. Each Office Is Independently Owned and Operated
Inventory Challenges Continue
This chart from the National Association of Realtors sums up the continuing shortage of houses for sale:
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Are new home sales really booming?
Sales of new single-family houses in February 2017 were at a seasonally adjusted annual rate of 592,000. This is 6.1 percent above the revised January rate of 558,000 and is 12.8 percent above the February 2016 estimate of 525,000.
That sounds good, right?
And here’s the chart provided with the release:
When my daughter was growing up I frequently (as her eye rolling testified) reminded her of the importance of understanding the difference between relative and absolute.
In relative terms, new home sales were good, recording the second highest monthly figure since February 2008.
But in absolute terms? Look at this chart going back to 1990:
From June 1992 to February 2008 – a span of more than 15 years – the monthly figure dropped below that just announced just once – in 189 months. And most of that time sales were a good deal higher.
What about existing home sales?
Existing home sales have recovered from the low levels after the Great Recession and are roughly back to the levels of 15-20 years ago.
Population
In 1992 the population of the US was about 255 million. By 2000 it was 282 million and today it is 325 million. But home sales have not increased in the last 20 years.
So are new home sales good news? Well, relatively, maybe – but absolutely? I think not.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Home sales plunge – or do they?
A recent article headlined a home sales plunge in November, but as always it pays to look into the numbers in more detail.
The National Association of Realtors (NAR) used a more moderate headline in its Existing home sales suffer setback in November report.
So what actually happened in November? (more…)
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