Often people read a report with bad news and only focus solely on that news without absorbing that information as a whole. The latest Existing-Home Sales Report from the NAR is a perfect example of this as they recently revealed that sales have decreased 1.8% in August. Of course, Chicken Littles out there will begin to panic, but let’s look deeper into the report to fully understand its contents. Lawrence Yun, NAR chief economist explains:
“There was a marked decline in all cash sales from investors. On the positive side, first-time buyers have a better chance of purchasing a home now that bidding wars are receding and supply constraints have significantly eased in many parts of the country.”
But, now that we got the bad news out of the way right out of the gate it is time to give you the good news that the report brought us.
- The median existing-home price for all housing types in August was $219,800, which is 4.8% above August 2013. This marks the 30th consecutive month of year-over-year price gains.
- 40% of homes sold in August were on the market for less than a month.
- Distressed home sales remain at single digits for the second straight month, at 8%, down from 12% from this time last year.
- More buyers qualified for mortgages to purchase a home in August, as evidenced by the decline in the number of all cash buyers from 29% to 23%.
But, the NAR is the only one with good news. According to data released by the US Department of Housing and Urban Development and the US Census Bureau, newly built single-family home sales surged 18% in August, the highest level in 6 years. Even more so, the experts agree. NAHB Chief Economist David Crowe:
“This robust level of new-home sales activity is a good sign that the housing recovery is moving towards higher ground. Historically low mortgage rates, attractive home prices and firming job and economic growth should keep the housing market moving forward in 2014.”
“As long as solid job growth continues, wages should eventually pick up to steadily improve purchasing power and help fully release the pent-up demand for buying.”
When you tune out all of the noise and simply add up the numbers you find that now is still a great time to buy a home, whether as a first-time homebuyer or if you’re moving up to the house of your dreams. Just don’t let the headlines scare you out of making the best decision for your family. The housing market is doing just fine and the recovery is ahead of schedule. So just sit back, relax, and enjoy watching the home sales climb along with housing appreciation.