As we see another work-week come to a close, we would like to reflect on some important Housing Numbers that were released this past week; S&P/Case-Shiller Home Prices, New Residential Sales, and Pending Home Sales.
With the Standard and Poors/Case-Shiller Home Prices (Prices Through July 2011), we saw the fourth consecutive month of increases in the City Composites (the 10 and 20 City Composites). Over the June to July period, 17 of 20 of the Metro Areas (MSAs) were up, with the two drops being registered by Las Vegas and Phoenix (and Denver was unchanged).
However, over a year, the reverse happened, with only two MSAs showing positive gains - Detroit and Washington DC (Surprising news for Detroit, especially). The worst performing of the remaining cities was Minneapolis (a 9.1% decline, however, better than the double-digit declines that it was posting for multiple consecutive months).
Recapping these figures, David M. Blitzer, Chairman of the Index Committee at Standard and Poors Indices, said that “While we have now seen four consecutive months of generally increasing prices, we do know that we are still far from a sustained recovery.", but adds that "Continued increases in home prices through the end of the year and better annual results must materialize before we can confirm a housing market recovery."
Let's Move on to the sales figures:
New Residential Sales for August dropped 2.3% from July, but rose 6.1% from August 2010 through August 2011. Pending Homes Sales for August ("a forward-looking indicator based on contract signings", per the National Association of Realtors® (NAR)), dropped 1.2% from July to August, but increased 7.7% from August 2010 to August 2011. Over the July-August period, the best-performing region was the South, which was up 2.6%, and over the one-year period, the best-performing region was the West, which was up 10.5%.in August but is 10.5 percent above a year ago.
Lawrence Yun, NAR chief economist, said the decline reflects an "uneven market", and that a reason for elevated levels of contact failures is that "financially qualified home buyers, willing to stay well within their means, are being denied credit". These "unnecessarily restrictive mortgage underwriting standards", as Yun calls them, are "road blocks to the housing recovery for people who are trying to take advantage of excellent affordability conditions".
Yun also said that based on the "improving fundamentals of population growth, some job additions, rent increases and higher stock market wealth", that we should be seeing existing-home sales closer to 5.5 million, but are expecting just over 4.9 million this year.
My two cent commentary: New Residential Sales and Pending Home Sales were up over the past year, however, home prices dropped over the past year. Read that line over and think about it. Shouldn't prices be going up with sales? Am I wrong? What are your thoughts?
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Have a Great Week, and Happy Rent-to-Owning !
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TAGS: #ResidentialSales #PendingSales #NAR #contractfailures #mortgage #underwriting