Thursday, August 23, 2012

Home Sales, Prices Show More Gains

U.S. home sales posted an annual increase for the 13th consecutive month in July, with prices trending upward as well, according to new figures released by the real estate firm RE/MAX.
July sales were up 10.3 percent over their July 2011 levels, according to the RE/MAX July Housing Market Report, while sales prices are up 3.7 percent over the same period.
It was the sixth consecutive month of annual gains for home prices, which combined with rising sales led RE/MAX to trumpet 2012 as “the year of the housing recovery.”

“Picture getting brighter”

“It’s reassuring that both sales and prices continue to rise higher on a yearly basis, indicating that this housing recovery is real,” said Margaret Kelly, RE/MAX CEO. “Overall, the picture is getting brighter each month, but what we need for a sustainable recovery is a turn-around in unemployment and better availability of mortgages, especially for higher priced homes.”
Not all the news was positive, however, as both sales and prices declined on a monthly basis. July home sales were down 9.4 percent from June’s levels, while prices were down a slight 0.6 percent for the same time, possibly due to seasonal factors. July’s median U.S. sale price was $169,000.

Shrinking inventory called limiting factor

Home sales could have been higher, according to the RE/MAX report, if not for a shrinking inventory of homes for sale that has fallen by nearly 27 percent over the past 12 months. The problem is especially pronounced in the lower price range, where most sales are now occurring. A tight inventory is also associated with higher housing prices.

Other analysts have recently noted that the inventory for homes for sale is being constrained by the large number of underwater homeowners who might like to sell, but are unable to do so.
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