Housing Moves Toward ‘Healthy Equilibrium’

The housing market is finding its center again, showing signs of greater balance, according to realtor.com’s latest National Housing Trend Report. The analysis finds year-over-year trends revealing strong gains in median list prices and declines in days on the market.

The report highlights some of the following progress on four main indicators for the housing market:

  • List prices: The median list price for homes in September dropped slightly but remained 6.4 percent higher than a year ago. More than 20 percent of the 146 markets that the realtor.com report covers posted year-over-year gains in listing prices of 12 percent or more.
  • Home sales: Sales of single-family homes, condos, and townhomes fell 1.68 percent in September, after six consecutive months of gradual rises.
  • Inventory levels: Inventories were 2.04 percent less in September than year ago levels—“signaling a greater balance between supply and demand,” realtor.com’s report notes.
  • Days on market: The  median age of inventory increased from 92 days to 93 days in September. However, it has fallen by 10.58 percent in the past year, which indicates that homes are selling more quickly, according to the report.

Source: “Housing Market Pushing Further Toward Healthy Equilibrium,” realtor.com (Oct. 16, 2013)

Rapid Rise in Home Prices ‘Remarkable’

We’re seeing the Sacramento region leading this trend! During the first six months of this year, home prices jumped 10 percent, the fastest pace in 36 years, CoreLogic reports. Mark Fleming, chief economist with CoreLogic, called the 10 percent jump “remarkable.”

In June, the latest data available, home prices were up 11.6 percent year over year, according to CoreLogic’s home price index, which reflects distressed sales as well. June marked the 16th consecutive month of increases.

The pace of home price appreciation is showing signs of slowing. In June, prices rose 1.9 percent compared to May — a slower pace for increases than  recent months. April to May, prices rose 2.6 percent, while they rose nearly 2.8 percent in April from March.

Some analysts point to a slowing due to rising mortgage rates, fewer investors  purchases, and a rise in inventory levels of homes for sale. The National Association of REALTORS® reported inventories of existing homes for sale rose to 5.2 months in June from 5 months in May. A six- to seven-month supply is considered a balanced market.

Still, prices are not showing signs of stalling. CoreLogic analysts predict that home prices will be up 12.5 percent year over year in July. Your comments?

Source: “Home Prices Rising at Fastest Pace in 36 Years,” Mortgage News Daily (Aug. 6, 2013) and “Home prices rise again, but at a slower pace,” USA Today (Aug. 6, 2013)