It’s a beautiful day in the neighborhood! Especially when home values are increasing, selling within a month and mortgage rates dropping another half percent. To say the least it’s a good day for buyers, sellers, real estate professionals and mortgage lenders!
The National Association of Realtors (NAR) recently released their national report on the state of the housing market through April. Homes.com thought you would be excited to know that properties are selling faster and at a higher price while distressed home sales only made up 18 percent of April’s total sales, a dramatic reduction compared to 28 percent of last April’s total sales. Lawrence Yun, NAR chief economist, stated “the housing market recovery is occurring in spite of tight access to credit and limited inventory” and with total sales above year-ago levels for last 22 consecutive months, we couldn’t be more hopeful by this news.
Here are some highlights from NAR’s report that may give you and your clients a little peace of mind about the market’s current conditions:
- Existing home sales across all regions experienced a .6 percent year over year increase
- Forty-four percent of all homes sold in April were on the market for less than a month
- The national median existing-home price ($192,800) for all housing types increased 11 percent from April 2012
- The Western region experienced the most growth with median home prices up 17.5 percent from April 2012
- 30-year, conventional, fixed-rate mortgages fell to 3.45 percent, a half percent lower than April 2012
- Prices show 14 consecutive months of year-over-year increases
While the latest report is encouraging, let’s not get ahead of ourselves. Conditions are improving but there’s still a ways to go. Inventory is still low which may be attributed to sellers’ reluctance to throw their hats in the ring and put their homes up for sale. The basic principle of supply and demand has become evident with buyer demand significantly exceeding the supply of homes available for sale. In fact, NAR President Gary Thomas said “with homes selling in half the time it took to sell a year ago, buyers must be both decisive and prudent”. Put their hesitations to rest by explaining that buyers are demanding more inventory, home prices are increasing and they may even receive multiple offers especially now with the busy season in full swing. And this is where real estate agents’ negotiation skills and familiarity with contracts will be key to successful transactions. Yun also expressed the need for new home construction which could also bridge that gap between low inventory and buyers’ demands. So, encourage your network of investors and builders to scout out new developments. ”If you build it. They will come.”
Yun also mentioned that buyers are facing rigid credit requirements for loan approval. To that end, encourage your clients to clean up their credit history, be realistic about what they can afford and where they want to move in relation to schools, work, etc.
To find out how real estate pros can further benefit from the current market conditions or to receive more details about the current state of the housing market checkout NAR’s full report. Also check out Homes.com new Local Market Index Reports for more specific regional and national data.