Tag Archives: recovery

Housing Inventory Reaches Record Low, But Brokers Expect Spring Bounce

Source: NWMLS

KIRKLAND, March 6, 2017) – Home buyers are in a spring mood, but sellers are still hibernating,
suggested one broker while commenting about the latest statistics from Northwest Multiple Listing
Service. Figures for February and feedback from brokers indicate record-low inventory is spurring
multiple offers, rising prices, fewer sales, and frustrated house-hunters.

Year over-year pending sales (mutually accepted offers) declined for the first time since March 2016,
falling 8.9 percent. Eight counties, including King and Snohomish, reported double-digit drops in pending
sales as the volume of new listings couldn’t keep pace with demand.

During the past three months, brokers have added 17,572 new listings to inventory, down only 5.7 percent
when compared to the same three-month period of a year ago. During the latest December-to-February
timeframe, MLS members reported 22,393 pending sales, far outpacing the number of new listings.

“Our robust market has created extreme conditions, and we’re seeing frenzy hot activity on each new
listing coming on the market,” reported J. Lennox Scott, chairman and CEO of John L. Scott. “We’re also
experiencing some of the lowest inventory levels on record,” he noted.

In fact, a check of Northwest MLS records dating to 2004 shows no other month when the number of
active listings dipped below the 10,000 mark – until last month.

At the end of February, there were 9,091 active listings in the Northwest MLS system, which
encompasses 23 counties. That represents a drop of nearly 25 percent from the year-ago total of 12,107.
“Home sellers and buyers are complaining equally about the current market’s low inventory,” remarked
MLS director George Moorhead, designated broker at Bentley Properties. “Sellers are frustrated when
they cannot find another home to match their current needs, or when a home goes off market so fast that
the option of a contingent sale is not even considered,” he stated.

Buyers have been grumbling about the market for the past two years, Moorhead said. “That mood has
escalated into a panic as other buyers up the ante – at times to a level that even causes real estate
professionals to shake their heads,” he remarked.

Brokers believe seasonality is a factor, with several saying they are expecting an uptick in listings.
“For buyers, hope springs eternal, but the sellers are still hibernating,” suggested John Deely, the
principal managing broker at Coldwell Banker Bain. “We’ve been experiencing continued high buyer
demand as the spring market takes off early but sellers are on a more traditional schedule as listings
slowly ramp up,” he reported, adding, “Sellers that have come to market ahead of the traditional spring
market are reaping the benefits of less competition [from others who are selling] and a highly competitive
buyer pool.”

 

Case-Shiller: Pace of Home Price Growth ‘Not Alarming’

Source: RISMedia

Home prices in the U.S. hiked to their highest level in more than two years in December, posting a 5.8 percent annual gain, according to the recently released S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index. Their pace, though substantial, is not “not alarming,” says David M. Blitzer, S&P Dow Jones Index Committee chairman and managing director.

“Home prices continue to advance, with the national average rising faster than at any time in the last two-and-a-half years,” Blitzer says. “With all 20 cities seeing prices rise over the last year, questions about whether this is a normal housing market or if prices could be heading for a fall are natural. In comparing current home price movements to history, it is necessary to adjust for inflation. Consumer prices are higher today than 20 or 30 years ago, while the inflation rate is lower. Looking at real or inflation-adjusted home prices based on the S&P CoreLogic Case-Shiller National Index and the Consumer Price Index, the annual increase in home prices is currently 3.8 percent. Since 1975, the average pace is 1.3 percent; about two-thirds of the time, the rate is between -4 percent and +7 percent. Home prices are rising, but the speed is not alarming.”

Home price growth in December was led by activity in Denver, Portland and Seattle, with annual gains of 8.9 percent, 10 percent and 10.8 percent, respectively. Prices for higher tier homes in Portland (more than $411,335) and Seattle (more than $532,716-plus) have been “stable” in the past five years, while prices for lower tier homes in Portland (less than $296,361) and Seattle (less than $335,111) have been “volatile”—movement that, according to Blitzer, signifies normality in the market.

“In the boom-bust of 2005-2009, prices of low, medium, and high tier homes moved together, while in other periods, including now, the tiers experienced different patterns,” says Blitzer.

The Index’s 10-City Composite posted a 4.8 percent annual gain and a 0.9 percent monthly gain, while the 20-City Composite posted a 5.6 percent annual gain and also a 0.9 percent monthly gain.

Home prices are continuing to be pressured by rising rates and supply shortages.

“One factor behind rising home prices is low inventory,” Blitzer says. “While sales of existing single-family homes passed 5 million units at annual rates in January, the highest since 2007, the inventory of homes for sales remains quite low with a 3.6 month supply. New-home sales at 555,000 in 2016 are up from recent years, but remain below the average pace of 700,000 per year since 1990.

“Another factor supporting rising home prices is mortgage rates. A 30-year fixed rate mortgage today is 4.2 percent, compared to the 6.4 percent average since 1990.”

Source: S&P Dow Jones Indices

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Over Half of Housing Markets Hit Price Peaks

Source: RISMedia

More than half of housing markets saw home sale prices peak at the end of 2016, according to the National Association of REALTORS®’ (NAR) recently released quarterly report, contributing to the best quarterly sales pace of the year. Eighty-nine percent of markets saw home prices increase in the fourth quarter, compared to 87 percent in the third quarter, with 17 percent experiencing double-digital increases.

“Buyer interest stayed elevated in most areas thanks to mortgage rates under 4 percent for most of the year and the creation of 1.7 million new jobs edging the job market closer to full employment,” says Lawrence Yun, NAR chief economist. “At the same time, the inability for supply to catch up with this demand drove prices higher and continued to put a tight affordability squeeze on those trying to reach the market.”

The median single-family home price nationally was $235,000 in the fourth quarter, up 5.7 percent from the fourth quarter of 2015. Fifty-two percent of the 150 markets analyzed by NAR now have a median price at or above prior all-time highs. The markets with the highest median prices in the fourth quarter were San Jose, Calif. ($1,005,000), San Francisco, Calif. ($837,500), and Anaheim-Santa Ana, Calif. ($745,200); those with the lowest were Youngstown-Warren-Boardman, Ohio ($87,600), Decatur, Ill. ($92,400) and Cumberland, Md. ($94,000).

The highest median home price regionally in the fourth quarter was in the West, at $348,800 (a 7.8 percent increase year-over-year), followed by the Northeast at $254,100 (a 0.2 percent decrease), the South at $210,500 (a 5.4 percent increase), and the Midwest at $181,000 (a 5.7 percent increase).

“Depressed new and existing inventory conditions led to several of the largest metro areas seeing near or above double-digit appreciation, which has pushed home values to record highs in a slight majority of markets,” Yun says. “The exception for the most part is in the Northeast, where price growth is flatter because of healthier supply conditions.”

Condo and co-op prices across the board also increased in the fourth quarter, up 6.1 percent year-over-year to $222,000.

Overall, housing affordability slid compared to the fourth quarter of 2015—according to NAR, buying a median-priced single-family home now would require an income of $51,017 for a 5 percent down payment, $48,332 for a 10 percent down payment, and $42,962 for a 20 percent down payment.

“Even a pick-up in wage growth may be insufficient to compensate the impact of higher mortgage rates and home prices,” says Yun. “Increased homebuilding will be crucial to alleviate supply shortages and stave off the affordability hit.”

“The prospect of higher mortgage rates and more home shoppers in coming months should be enough of an incentive for those serious about buying to start their search now,” says NAR President Bill Brown. “There are fewer listings on the market, but also a little less competition than what’s expected this spring. Buyers may find just the home they’re looking for at a good price and without the possibility of having to outbid others.”

For more information, please visit www.nar.realtor.

For the latest real estate news and trends, bookmark RISMedia.com.

Equity Stacked: Homeowner Wealth on the Rise

Source: RISMedia

Homes in markets across the nation have regained value since the recession, affording homeowners the ability, once again, to accumulate wealth through equity—or become, as I like to call it, “equity stacked.”

Two recent reports confirm the trend: one, from S&P/CoreLogic; the other by ATTOM Data Solutions, owner of RealtyTrac.

Homeowner wealth, according to S&P, has more than doubled since 2011, expanding on a national scale to $12.7 trillion from $6.1 trillion, in tandem with the 40 percent boost in the value of single-family housing. For the Average Joe next door, $12.7 trillion breaks down to an average $11,000—or $30,000 if he lives in California, Oregon or Washington (West Coast…shocking!) The upward momentum in equity, S&P cites, has positive economic implications, as well: more than $100 billion in consumer spending, which includes dropping stacks (see what I did there?) on home improvements.

The distribution of homeowners who are “equity rich,” as ATTOM defines—those with a loan-to-value ratio of 50 percent or less—has grown, in addition, to 13.1 million, or roughly one-quarter of the homeowner population in the U.S. The distribution of homeowners who are “seriously underwater,” at the same time, has gone down to 6 million—a far cry from the 2012 peak of 12.8 million.

Why are more homeowners joining the “1 percent” of equity rich? They’re extending their stay, says Daren Blomquist, senior vice president at ATTOM.

“Close to one in every five U.S. homeowners with a mortgage is now equity rich thanks to a combination of rising home prices and lengthening homeownership tenures,” Blomquist says. “Median home prices increased on a year-over-year basis for the 18th consecutive quarter in Q3 2016, and homeowners who sold in the third quarter had owned their home an average of 7.94 years—a new high in our data and substantially higher than the average homeownership tenure of 4.26 years pre-recession. As homeowners stay in their homes longer before moving up, they are amassing more home equity wealth.”

The equity rich, according to ATTOM’s report, are concentrated on—hold your breath—the West Coast, in Honolulu (39.3 percent), San Francisco (49.8 percent) and San Jose (55.7 percent). In San Fran and San Jose, the amount of equity rich residents has gone up over 10 percent in the last year.

Dual forces, as indicated in both the S&P and ATTOM reports, are at work here. The ongoing trend toward recovering prices, and activity in the market to match, is turning more homeowners into equity stackers, flush with wealth for the future—and adding more to the “1 percent.” Stack on!

Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas atsdevita@rismedia.com.

Home Price Gains Strong in South and West

Source: RISMedia

Data released for June 2016 shows that home prices continued their rise across the country over the last 12 months.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.1 percent annual gain in June, unchanged from last month. The 10-City Composite posted a 4.3 percent annual increase, down from 4.4 percent the previous month. The 20-City Composite reported a year-over-year gain of 5.1 percent, down from 5.3 percent in May.

Portland, Seattle, and Denver reported the highest year-over-year gains among the 20 cities over each of the last five months. In June, Portland led the way with a 12.6 percent year-over-year price increase, followed by Seattle at 11.0 percent, and Denver with a 9.2 percent increase. Six cities reported greater price increases in the year ending June 2016 versus the year ending May 2016.

Before seasonal adjustment, the National Index posted a month-over-month gain of 1.0 percent while both the 10-City Composite and the 20-City Composite posted a 0.8 percent increase in June. After seasonal adjustment, the National Index recorded a 0.2 percent month-over-month increase, and both the 10-City Composite and 20-City Composite posted 0.1 percent month-over-month decreases. After seasonal adjustment, nine cities saw prices rise, two cities were unchanged, and nine cities experienced negative monthly prices changes.

“Home prices continued to rise across the country led by the west and the south,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “In the strongest region, the Pacific Northwest, prices are rising at more than 10 percent; in the slower Northeast, prices are climbing a bit faster than inflation. Nationally, home prices have risen at a consistent 4.8 percent annual pace over the last two years without showing any signs of slowing.

“Overall, residential real estate and housing is in good shape,” he continued. “Sales of existing homes are running at about 5.5 million units annually with inventory levels under five months, indicating a fairly tight market. Sales of new single family homes were at a 654,000 seasonally adjusted annual rate in July, the highest rate since November 2007. Housing starts in July topped an annual rate of 1.2 million units. While the real estate sector and consumer spending are contributing to economic growth, business capital spending continues to show weakness.”

Quicken Loans vice president Bill Banfield offered the following comments on the report:

“The strong home price growth in much of the country, and meteoric rise in the West, is led by a continued lack of homes available for sale. While homeowners welcome rising prices, it could begin to hinder new buyers if affordability comes into question – especially with home prices rising twice the speed of inflation in much of the country.”

For more information, visit www.spglobal.com.

Housing Recovery Continues despite Affordability Obstacles

Source: RISMedia

The national housing market has now regained enough momentum to provide an engine of growth for the U.S. economy, according to the latest The State of the Nation’s Housing report by the Joint Center for Housing Studies. Robust rental demand continues to drive the housing expansion, and sales, prices, and new construction of single-family homes are on the rise. Even more important, income growth has picked up, particularly among the huge millennial population that is poised to form millions of new households over the coming decade. At the same time, however, several obstacles continue to hamper the housing recovery—in particular, the lingering pressures on homeownership, the eroding affordability of rental housing, and the growing concentration of poverty.

The national homeownership rate has been on an unprecedented 10-year downtrend, sliding to just 63.7 percent in 2015. “Tight mortgage credit, the decade-long falloff in incomes that is only now ending, and a limited supply of homes for sale are all keeping households—especially first-time buyers—on the sidelines,” says Chris Herbert, managing director of Harvard’s Joint Center for Housing Studies. “And even though a rebound in home prices has helped to reduce the number of underwater owners, the large backlog of foreclosures is still a serious drag on homeownership.”

As these lingering effects of the housing crash fade, homeownership may regain some lost ground, but how soon and how much are open to question. Moreover, the report finds that income inequality increased over the past decade, with households earning under $25,000 accounting for nearly 45 percent of the net growth in U.S. households in 2005–2015. As Herbert sums it up, “The question is not so much whether families will want to buy homes in the future, but whether they will be able to do so.”

Mirroring the persistent weakness on the owner-occupied side is the equally long surge in rental housing demand, with increases across all age groups, income levels, and household types. With vacancy rates down sharply and rents climbing, multifamily construction is booming across the country. But with strong growth among high-income renters, so far most of this new housing is intended for the upper end of the market, with rents well out of reach of the typical renter making $35,000 a year. Because of the widening gap between market-rate rents and the amounts many households can afford at the 30-percent-of-income standard, the number of cost-burdened renters hit 21.3 million in 2014. Even worse, 11.4 million of these households paid more than half their incomes for housing, a record high. The report finds that rent burdens are increasingly common among moderate-income households, especially in the nation’s 10 highest-cost housing markets, where three-quarters of renters earning $30,000–45,000 and half of those earning $45,000–75,000 paid at least 30 percent of their incomes for housing in 2014.

Cost burdens are nearly universal among the nation’s lowest-income households. Federal assistance reaches only a quarter of those who qualify, leaving nearly 14 million households to find housing in the private market where low-cost units are increasingly scarce. Low-income households with cost burdens face higher rates of housing instability, more often settle for poor-quality housing, and have to sacrifice other needs—including basic nutrition, health, and safety—to pay for their housing. These conditions have serious long-term consequences, particularly for children’s future achievement. “And compounding these challenges,” adds Daniel McCue, a senior research associate at the Joint Center, “residential segregation by income has increased. Between 2000 and 2014, the number of people living in neighborhoods of concentrated poverty more than doubled to 13.7 million.”

The report notes that a lack of a strong federal response to the affordability crisis has left state and local governments struggling to expand rental assistance and promote construction of affordable housing in areas with access to better educational and employment opportunities through inclusionary zoning and other local resources.

“These efforts are falling far short of need,” says Herbert. “Policymakers at all levels of government need to take stock of what can and should be done to expand access to good-quality, affordable housing that is so central to the current well-being and potential contribution of each and every individual.”

To view the full report, click here.

99 of Top 100 Housing Metros Improve Year over Year

Source: RISMedia

The spring buying season continues to cruise along throughout most of the country, according to Freddie Mac’s recently released Multi-Indicator Market Index® (MiMi®). Two additional metros—Charlotte, N.C., and Knoxville, Tenn.—entered their benchmark ranges.

The national MiMi value stands at 84.1, indicating a housing market that’s on the outer range of its historic benchmark level of housing activity, with a +0.27 percent improvement from March to April and a three-month improvement of +1.63 percent. On a year-over-year basis, the national MiMi value has improved +7.37 percent. Since its all-time low in October 2010, the national MiMi has rebounded 42 percent, but remains significantly off from its high of 121.7.

Thirty-six of the 50 states plus the District of Columbia have MiMi values within range of their benchmark averages, with the District of Columbia (102), Hawaii (97.4), Utah (95.9) and Colorado, Montana and Oregon all having the same value (95.8) and being closest to their benchmark averages.

Sixty-seven of the 100 metro areas have MiMi values within range with Nashville, Tenn. (99.9), Honolulu, Hawaii (99.8), Salt Lake City, Utah (99.0), Los Angeles, Calif. (98.6) and Austin, Texas (102.6) ranking in the top five.

The most improving states month over month were Mississippi (+1.29%), Tennessee (+1.27%), Massachusetts (+1.15%), Florida (+0.98%) and Nebraska (+0.97%). On a year-over-year basis, the most improving states were Florida (+15.34%), Colorado (+14.73%), Nevada (+14.62%), Oregon (+14.46%) and New Jersey (+13.48%).

The most improving metro areas month over month were Lakeland, Fla. (+2.06%), Chattanooga, Tenn. (+2.04%), Modesto, Calif. (+1.83%), Orlando, Fla. (+1.82%), and New Haven, Conn. (+1.78%). On a year over year basis, the most improving metro areas were Orlando, Fla. (+20.17%), Tampa, Fla. (+17.47%), Denver, Colo. (+17.39%), Cape Coral, Fla. (+16.69%), and Portland, Ore. (+15.99).

In April, 42 of the 50 states and 86 of the top 100 metros were showing an improving three-month trend. The same time last year, 46 of the 50 states, and all of the top 100 metro areas were showing an improving three-month trend.

“Seven years into the recovery from the Great Recession most of the nation’s housing markets remain below their historical benchmarks, but continue to grind higher month-by-month,” says Freddie Mac Deputy Chief Economist Len Kiefer. “Nationally, MiMi in April 2016, is 84.1, a 7.37 percent year-over-year increase and the 48th consecutive month of year-over-year increases. Over this four-year timeframe, MiMi has increased 36.5 percent and now stands just 15.9 percent below its historic benchmark average.

“Out of the 50 states and the District of Columbia 49 posted positive year-over-year changes. North Dakota and Wyoming, two states heavily reliant on the energy sector, were the only states with year-over-year declines. Out of the 100 metro areas MiMi tracks, 99 posted positive year-over-year gains, with Tulsa, Oklahoma — also with deep ties to the energy sector — posting no change year-over-year.

“Among the four MiMi indicators, Purchase Applications increased the most in April, rising 1.77 percent from March and up 15.27 percent year over year. The strong positive momentum in home purchase applications is a good sign for a housing market likely to post the best year in home sales since 2006. Despite strong house price growth, the MiMi Payment-to-Income indicator fell 1.05 percent in March, reflecting the impact of lower mortgage rates. If global factors like the Brexit put significant downward pressure on long-term mortgage rates, the U.S. housing market could benefit from increased affordability, helping to partially offset the impact of house prices, which are rising around six percentage points year over year nationally.”

For more information, visit www.FreddieMac.com/mimi.

Existing-Home Sales Reach Highest Pace in Over Nine Years

Source: RISMedia

Existing-home sales sprang ahead in May to their highest pace in almost a decade, while the uptick in demand this spring amidst lagging supply levels pushed the median sales price to an all-time high, according to the National Association of REALTORS®. All major regions except for the Midwest saw strong sales increases last month.

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, grew 1.8 percent to a seasonally adjusted annual rate of 5.53 million in May from a downwardly revised 5.43 million in April. With last month’s gain, sales are now up 4.5 percent from May 2015 (5.29 million) and are at their highest annual pace since February 2007 (5.79 million).

“The May gain over April signals that the real estate market has maintained strong momentum all spring,” says realtor.com chief economist Jonathan Smoke. “We are now in this year’s peak home buying months, and this pace of sales should produce the gains we have been forecasting that will make 2016 the best year of home sales in a decade. The biggest challenge to prospective buyers right now is tight supply, which we have seen for 45 consecutive months. In these conditions, home values have strong support, but potential buyers will continue to face challenges finding a home for sale that meets their needs. That is why we’re seeing the age of inventory drop dramatically while prices have gone up 5 percent over the last year and are now at record nominal levels.”

Lawrence Yun, NAR chief economist, says existing sales continue to hum along, rising in May for the third consecutive month. “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,” he says. “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.”

Adds Yun, “Barring further deceleration in job growth that could ultimately temper demand from these repeat buyers, sales have the potential to mostly maintain their current pace through the summer.”

Surpassing the peak median sales price set last June ($236,300), the median existing-home price for all housing types in May was $239,700, up 4.7 percent from May 2015 ($228,900). May’s price increase marks the 51st consecutive month of year-over-year gains.

Total housing inventory at the end of May rose 1.4 percent to 2.15 million existing homes available for sale, but is still 5.7 percent lower than a year ago (2.28 million). Unsold inventory is at a 4.7-month supply at the current sales pace, which is unchanged from April.

“Existing inventory remains subdued throughout much of the country and continues to lag even last year’s deficient amount,” adds Yun. “While new home construction has thankfully crept higher so far this year, there’s still a glaring need for even more, to help alleviate the supply pressures that are severely limiting choices and pushing prices out of reach for plenty of prospective first-time buyers.”

The share of first-time buyers was 30 percent in May, down from 32 percent both in April and a year ago. First-time buyers in all of 2015 also represented an average of 30 percent.

According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage inched backward from 3.61 percent in April to 3.60 percent in May, which is the lowest since May 2013 (3.54 percent). The average commitment rate for all of 2015 was 3.85 percent.

Properties typically stayed on the market for 32 days in May (39 days in April), which is below a year ago (40 days) and the shortest time since NAR began tracking in May 2011. Short sales were on the market the longest at a median of 103 days in May, while foreclosures sold in 51 days and non-distressed homes took 30 days. Forty-nine percent of homes sold in May were on the market for less than a month – the highest percentage since NAR began tracking.

May inventory data from Realtor.com® shows that the top five metropolitan statistical areas where listings stayed on the market the shortest amount of time were San Francisco-Oakland-Hayward, Calif., and Seattle-Tacoma-Bellevue, Wash., both at a median of 25 days; San Jose-Sunnyvale-Santa Clara, Calif., 26 days; and Denver-Aurora-Lakewood, Colo., and Vallejo-Fairfield, Calif., both at 30 days.

Earlier this month, NAR released a new survey looking at the home buying opportunities of student debt borrowers who are current in their repayment. The findings affirmed the notion that repaying student debt is a contributing factor to the low homeownership rate among young adults and the underperforming share of first-time buyers. Nearly three-quarters of non-homeowners in the survey believed that their student debt is delaying them from buying a home, with most of them citing not being able to save for a down payment as the primary reason.

“At a time of historically low interest rates, responsible student loan borrowers should have the opportunity to refinance their loans from their current rates, which can oftentimes run over double-digit percentage points,” says NAR President Tom Salomone. “In addition to policy proposals that streamline income-based repayment programs and allow student loan borrowers the ability to refinance into lower rates, NAR supports those that promote student loan simplification, clarity and education. Furthermore, it’s important that mortgage underwriting guidelines related to student loan debt are standardized and do not impair homeownership opportunities.”

All-cash sales were 22 percent of transactions in May, down from both 24 percent in April and a year ago. Individual investors, who account for many cash sales, purchased 13 percent of homes in May, unchanged from April and down from 14 percent a year ago. Sixty-three percent of investors paid cash in May.

Distressed sales– foreclosures and short sales – declined to 6 percent of sales in May, down from 7 percent in April and 10 percent a year ago. Five percent of May sales were foreclosures and 1 percent were short sales. Foreclosures sold for an average discount of 12 percent below market value in May (17 percent in April), while short sales were discounted 11 percent (10 percent in April).

Single-family and Condo/Co-op Sales

Single-family home sales increased 1.9 percent to a seasonally adjusted annual rate of 4.90 million in May from 4.81 million in April, and are now 4.7 percent higher than the 4.68 million pace a year ago. The median existing single-family home price was $241,000 in May, up 4.6 percent from May 2015.

Existing condominium and co-op sales rose 1.6 percent to a seasonally adjusted annual rate of 630,000 units in May from 620,000 in April, and are now 3.3 percent above May 2015 (610,000 units). The median existing condo price was $229,600 in May, which is 6.0 percent above a year ago.

Regional Breakdown

May existing-home sales in the Northeast increased 4.1 percent to an annual rate of 770,000, and are now 11.6 percent above a year ago. The median price in the Northeast was $268,600, which is 0.1 percent below May 2015.

In the Midwest, existing-home sales dropped 6.5 percent to an annual rate of 1.30 million in May, but are still 3.2 percent above May 2015. The median price in the Midwest was $190,000, up 4.8 percent from a year ago.

Existing-home sales in the South expanded 4.6 percent to an annual rate of 2.28 million in May, and are now 6.5 percent above May 2015. The median price in the South was $211,500, up 5.9 percent from a year ago.

Existing-home sales in the West jumped 5.4 percent to an annual rate of 1.18 million in May, but are still 1.7 percent lower than a year ago. The median price in the West was $346,900, which is 7.7 percent above May 2015.

For more information, visit www.realtor.org

Home Prices on the Rise: Watching the Affordability Trajectory

Source: RISMedia

Recently, one of the most closely-watched housing market indicators, the S&P/Case-Shiller Home Price Indices, was released, and the numbers largely confirmed what the market has known for a while: U.S. home prices continue to climb at a moderate pace.

More importantly, there is a strong consensus among several widely followed home price indicators – including the Corelogic Home Price Index, FNC Residential Price Index, FHFA House Price Index, and S&P/Case-Shiller HPI – that prices nationwide are appreciating at a steady rate of about 5-6 percent annually amid a growing U.S. economy and low interest rates.

As another busy spring homebuying season is almost upon us, continued price growth is certainly encouraging to those who plan to buy
their very first home, relocate to a different city, or simply to trade an existing home for a newer and bigger one. And, if past boom-and-bust housing cycles have revealed anything about homebuying behavior, it is the fact that psychologically and economically, people prefer to buy homes when prices are
rising than when they are falling.

The spring housing market appears to be off to a good start. The latest seasonally unadjusted February existing-home
sales from the National Association of Realtors indicated total sales grew 6.4 percent from a year ago.