New estimates from the National Association of Realtors show home sales at their highest annual pace since February 2007. In fact, sales of previously owned homes increased 1.8 percent in May, marking the third consecutive monthly sales gain. Lawrence Yun, NAR’s chief economist, says most of the sales activity is from repeat buyers. “This spring’s sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more homeowners realizing the equity they’ve accumulated in recent years and finally deciding to trade-up or downsize,” Yun said. “With first-time buyers still struggling to enter the market, repeat buyers using the proceeds from the sale of their previous home as their down payment are making up the bulk of home purchases right now.” Regional results show sales up in the South, West, and Northeast. The Midwest, on the other hand, saw a 6.5 percent decline – though sales remain 3.2 percent above last year’s level. Also in the report, the number of homes available for sale rose in May. At the current sales pace, unsold inventory represents a 4.7-month supply. Typically, a six month supply is considered a healthy market. More here.
Tag: New
New Homes Now 61% Bigger Than 40 Years Ago
In 2015, the median size of a completed single-family home was 2,467 square feet, according to new numbers from the U.S. Census Bureau’s annual Characteristics of New Housing. That’s 61 percent larger than it was 40 years ago and 11 percent bigger than a decade ago. And, in addition to the extra square footage, today’s new homes are also packed with more features than they used to have. For example, more than 90 percent of new homes built last year had air conditioning and at least two bathrooms. By comparison, a little less than half of the new homes built in 1975 had air conditioning and only 60 percent of them had two bathrooms. But along with becoming bigger, new homes have also climbed in price. In fact, the median sales price of new single-family homes sold last year was $296,400. That sets a new record and partly explains the reason why first-time home buyers have had difficulty finding affordable homes this spring. With the average new home selling for around $300,000, buyers looking for an affordable, starter home in many markets are limited to choosing from previously owned homes – as the majority of new homes are priced beyond their budget. Also in the report, among new homes built last year, 47 percent had four or more bedrooms, more than half were two stories, and a majority had two-car garages. More here.