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Housing Market Upswing

August 25, 2009

As I predicted last winter, the housing market appears to be recovering, as documented in this recent report from the National Association of Realtors:

Existing home sales jump to two year high

The housing market is a buyer’s market and they are buying.

The National Association of Realtors reports sales of existing homes jumped 7.2 percent in July, the biggest monthly increase since it began keeping track in 1999.

Sales rose to an annual pace of 5.24 million. It was the fourth consecutive monthly increase in existing home sales, the longest streak since June 2004. Sales were 5 percent higher than a year ago, the first time sales were above year ago levels since November 2005.

“The housing market has decisively turned for the better,” said NAR chief economist Lawrence Yun in a statement. “A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing the higher sales.”

Tax credits, prices that have been driven lower for the last two years, and historically low mortgage rates are all contributing to rising sales.

Freddie Mac (NYSE: FRE) this week reported 30-year fixed-rate mortgages fell to an average of 5.12 percent this week. A year ago, long-term mortgages were 6.5 percent.

Yun also notes in some recovering markets, like San Diego, Las Vegas, Phoenix and Orlando, the demand for foreclosed and lower priced homes has spiked, and lack of inventory is becoming a common complaint.


Patty Cunningham, Realtor®                                                   390 Waterloo Blvd, Suite 101
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