Nationally Sales of New Homes Increase to Match Two-Year High
The operative word here is national sales of new homes rose more than projected in July to match a two-year high. An important fact to remember is that real estate is geographical in nature and while the west may have stunning increases, elsewhere in the U.S. may not be as stellar.
THE NATIONAL PERSPECTIVE
Sales climbed 3.6 percent to a 372,000 annual pace, following a 359,000 rate in June that was higher than previously estimated, figures from the Commerce Department showed today in Washington. Last month’s rate was the same as in May, which was the strongest since April 2010. The median forecast of 72 economists surveyed by Bloomberg called for a rise to 365,000.
Buyers are returning to the market to take advantage of cheaper properties and record-low mortgage rates, helping to boost orders at new home builders. Competition exists from foreclosures, unemployment exceeding 8 percent, and limited credit pose hurdles to a more pronounced rebound.
Some prognosticators believe the demand could continue to climb right on into 2013.
- Sales of new houses were up 25 percent from a year ago – Source: Commerce Department
- The median price for a new house decreased 2.5 percent in July from the same month last year, to $224,200.
- The value of all U.S. homes climbed 1.8 percent in the second quarter from the previous three months, the biggest gain since late 2005. Source: Federal Housing Finance Agency
Sales of new homes, tabulated when contracts are signed, are considered a timelier barometer than purchases of previously owned dwellings, which are calculated when a contract closes. Newly constructed houses accounted for 6.7 percent of the residential market in 2011, down from a high of 15 percent during the boom of the past decade.
The NAR figures also showed distressed sales, comprised of foreclosures and short sales, in which the lender agrees to a transaction for less than the balance of the mortgage, accounted for 24 percent of existing-home purchases. The share was less than the prior month and down from 29 percent in July 2011. Of those, 12 percent were foreclosed houses and 12 percent were short sales.
You can review the local financials for the Scottsdale real estate area at Maricopa County Real Estate Market Watch.