Have you checked out the sale-to-list price of some of the homes in your neighborhood recently?
I have. And the difference was over six figures.
Realizing of course, that home prices are different across markets, neighborhoods and school districts, something definitely has hit the value vein in the housing recovery.
The National Association of Realtors reports the median home price, $213,500 in July, was just 7.3% off the record high in 2006 when it was $230,400.
The median price was 13.7% higher than the same period a year ago, and the 17th consecutive month prices have risen year over year.
Clearly, values have bounced back.
But it’s important to note that median literally is the middle number between the highest and the lowest. So the bounce back doesn’t necessarily mean there’s a recovery at all price points or for all.
Existing home sales also were up in July – increasing 6.5% to a seasonally adjusted annual rate of 5.39 million from 5.06 million in June. The pace of sales was 17.2% higher than July 2012.
NAR says that monthly existing home sales have now remained above year-ago levels for 25 months.
Along with the rise in values, inventory levels are also increasing, though still too low to fully meet demand in some markets. Total housing inventory at the end of July climbed 5.6% to 2.28 million existing homes for sale, representing a 5.1-month supply at the current sales pace.
Restricted inventory is the reason for the above-normal price growth in many markets.
The last piece of our housing snapshot is interest rates, which clearly have been increasing. Average rates on 30-year conventional fixed-rate mortgages were 4.37% in July, up from 4.07% in June. The question going forward will be how much will rates rise before starting to remove large swaths of buyers from the market?
We’re likely to see all of these trends continue to the end of the year, making 2013 pivotal in the big picture of the housing recovery.
By Gino Blefari
President & CEO
Intero Real Estate Services, Inc.