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Pending Home Sales Surge in June

According to the National Association of Realtors (NAR), pending home sales, which represents signed contracts on existing homes, rose 16.6% in June.  This surge represents the second consecutive month of double-digit gains.  NAR’s Chief Economist, Lawrence Yun stated, “It is quite surprising and remarkable that, in the midst of a global pandemic, contract activity for home purchases is higher compared to one year ago.”  Yun also pointed out that, “Consumers are taking advantage of record-low mortgage rates resulting from the Federal Reserve’s maximum liquidity monetary policy.”  The NAR is expecting these record low interest rates to remain for the next eighteen months!

A breakdown by region has the Northeast leading the way with a 54.4% monthly increase in pending sales, the Midwest at 12.2%, the South at 11.9%, and West at 11.7%.  Overall, the Northeast’s impressive increase may be attributed to a longer lockdown versus the other regions. 

Sources:

https://cnb.cx/39SItn0

https://bit.ly/3fiAj8A

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.


Resilient Housing Market

Signed contracts on new homes were up 13.8% for the month of June.  This is a very large increase and much stronger than the estimated 4%.  Adding in June’s demand, annual sales are up 7%.  Median home pricing for the year has increased by 5.8% to $329,300.  This was a very strong report, and proves that the housing market is very resilient and strong, especially when analyzing the new construction home sector.

Another strong housing report was released last week by the Federal Housing Finance Agency.  Their Home Price Index showed that home prices fell in May slightly by 0.3%, but are still up by 4.9% since May of 2019.  This data is slightly lagging as it’s from May, plus it only analyzes data on single-family homes with conforming loan amounts.  Despite these facts, it still shows strength as home pricing is still on the rise.

Lastly, the strongest of the reports, Existing Home Sales, showed that sales on already-built or “existing” homes, increased by a whopping 20.7% for the month of June.  This was the largest one month jump ever.  Last year’s numbers showed that sales were down 27% at the time, further reflecting the massive improvement we’re seeing this year.  Also, inventory numbers were down by 18.2% for the month, which makes you wonder, if there were more homes available for sale, would these numbers be even stronger?

As seen in each of these reports, the housing market is very resilient and demand for homes is still very strong.

Sources: 

http://bit.ly/2MJU6mf

https://bit.ly/3f4R6fl

http://bit.ly/2sq38xg


Home Prices Continue to Rise and New Home Sales Skyrocket

According to the latest Radian Home Price Index data, home prices across the US grew at an annualized rate of 6.3% over the first half of this year.  In addition, from July 2019 to June 2020, home prices have increased 8.1%, which is an increase over last month’s 7.8% year over year recording.  The uptick from last month is a welcome sign and is an indicator that home price gains are gaining momentum despite all of the challenges presented for home buying and selling during a global pandemic. 

The demand for newly built homes also continues to increase.  Sales of newly built homes jumped 55% annually in June, according to a monthly survey by John Burns Real Estate Consulting.  This large move represents the highest pace of growth sales since the height of the housing boom in 2005.  Sales of new homes were the strongest in the Northeast, with an 86% annual jump, followed by Florida, which saw an 84% jump. 

Both reports are strong indicators that the housing market is as strong as ever and is resistant to the challenges presented during the COVID-19 crisis. 

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources:

https://bit.ly/3hcuPNU

https://cnb.cx/2WARyeU


Jobless Claims Slowing Down and Mortgage Volume Up

Last week initial jobless claims came in at 1.314 million.  This shows the number of individuals who claimed or filed for unemployment for the first time.  It came in better than the expectations of 1.4 million and was slightly lower than last week’s number of 1.413 million.  Continuing claims, which measures individuals who “continued” their file of unemployment, improved rather significantly from 18.76 million to 18.06 million.  This was one of the first very meaningful unemployment improvements in a long time, and may be pointing to a recovery. This is, however, a lagging indicator, so we will continue to monitor it closely. 

On the mortgage front, the Mortgage Bankers Association released their application data, and it showed that overall mortgage volume was up by 2.2% for the week of the 29th.  Purchase applications are up by 5% and year-over-year they are up 33%.  Refinances are up by 0.2% for the week and up by 111% compared to last year.   Also, it is important to know that refinances made up about 60% of all mortgage transactions as interest rates are at historically low levels.

As individuals get back to work and businesses reopen, we are poised for a very active and healthy housing market.  The stage is set with home buyer demand at record levels and historically low interest rates. 

 

Sources:

 

https://bit.ly/2BQGQd4

https://bit.ly/2C0LViX

 


Advisors 30 Second Market Update for the week of July 6, 2020.

Pending Home Sales Soar Record Highs

According to the National Association of Realtor’s Pending Home Sales Index (PHSI), pending home sales spiked 44.3% in May, compared to April.  This record increase beat expectations by 15%, and represents the largest one-month jump in the history of the survey, which dates back to 2001.  NAR’s Chief Economist, Lawrence Yun stated, “This has been a spectacular recovery for contract signings, and goes to show the resiliency of American consumers and their evergreen desire for homeownership.”  He also weighed in on the overall economy stating, “This bounce back also speaks to how the housing sector could lead the way for a broader economic recovery.”

Overall, this report strongly indicates that buyers are extremely eager to purchase homes, despite some of the restrictions put in place due to COVID-19.  Many are viewing homes via virtual tours, or using lockboxes to tour the homes themselves.  While inventory still remains an issue, buyers have proven they are eager to capitalize on record-low interest rates and begin reaping the rewards of homeownership.

Sources: 

https://bit.ly/2BtXM8L

https://cnb.cx/2D2Vsq1

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.


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