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21 April 2017
 |
| U.S.Home Sales(The Total Investment & Insurance Solutions) |
Americans purchased homes in March at the fastest pace in over a decade,
a strong start to the traditional spring buying season. The Total Investment & Insurance Solutions
Sales of existing homes climbed 4.4 percent
last month to a seasonally adjusted annual rate of 5.71 million, the National
Association of Realtors said Friday. This was the fastest sales rate since
February 2007. The Total Investment
& Insurance Solutions
The U.S. housing market faces something of a
split personality: A stable economy has intensified demand from would-be
buyers, but the number of properties listed for sale has been steadily fading.
The result of this trend is prices rising faster than incomes, homes staying on
the market for fewer days and a limit on just how much home sales can grow.
It's a situation that rewards would-be buyers who can act quickly and
decisively. The Total Investment &
Insurance Solutions
"The pace of sales we saw in March is
unsustainable," said Nela Richardson, chief economist at the brokerage
Redfin. "Sales may be soaring, but inventory isn't."
The inventory shortage largely reflects the
legacy of a housing bubble that began to burst a decade ago.
Foreclosed properties were snapped up by
investors who turned the homes into income-generating rentals, depriving the
market of supply. And many owners who escaped the downturn unharmed chose to
refinance their mortgages at extremely low rates, possibly making them hesitant
to move to a new house that could increase their monthly costs. The Total Investment & Insurance
Solutions
This mismatch between supply and demand can
be seen in two simple figures tracked by the Realtors.
Sales have risen 5.9 percent over the past
year, but the inventory of homes for sale has fallen 6.6 percent to 1.83
million properties. This means there are essentially more buyers chasing fewer
properties.
The consequences can be seen in home values
and days on the market. The median sales price in March climbed 6.8 percent
over the past year to $236,400, significantly outpacing wage growth. And it
took an average of 34 days to complete a sale, compared to 47 days a year ago.
In March, sales rose in the Northeast,
Midwest and South but declined in the West.
It's possible that more Americans are
devoting their incomes to housing as retail sales have struggled in recent
months, said Jennifer Lee, a senior economist at BMO Capital Markets.
"Although spending on doo-dads may have
slowed, perhaps more of their funds are being directed towards housing,"
Lee said. The Total Investment &
Insurance Solutions
Demand might increase further as mortgage
rates began to dip in recent weeks.
Home loan costs had been climbing after
President Donald Trump won the November election, under the belief that the
government would engage in forms of stimulus such as tax cuts and greater
deficits that could cause higher levels of inflation. But major initiatives
such as tax reform have stalled in recent weeks as the administration has yet
to put forward a proposal, prompting more doubts as to when and whether any
stimulus might arrive. The Total
Investment & Insurance Solutions
Mortgage buyer Freddie Mac said Thursday that
the average interest rate on 30-year fixed-rate home loans declined to 3.97
percent this week from 4.08 percent last week. The average is now at its lowest
level in five months.The Total
Investment & Insurance Solutions
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