Existing Home Prices Hit Record; Sales Soar To 8 Year High [Property Sales Are Hot, Hot, Hot]

Zero Hedge ^ | 07/22/2015 | Tyler Durden

[SeekAndFind]

Houses have become stocks... the higher the price, the more demand (especially as the government has your back with low down-payment loans and the re-emergence of IOs). With Existing Home Sales soaring to a SAAR of 5.49 million, the highest since early 2007, the fact that median home prices are at an all-time high appears to be any problem for the releveraging American (or Chinese) homebuyer.

 

 

Lawrence Yun, NAR chief economist, says backed by June's solid gain in closings, this year's spring buying season has been the strongest since the downturn. "Buyers have come back in force, leading to the strongest past two months in sales since early 2007," he said. "This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy."

Adds Yun, "June sales were also likely propelled by the spring's initial phase of rising mortgage rates, which usually prods some prospective buyers to buy now rather than wait until later when borrowing costs could be higher."

The median existing-home price for all housing types in June was $236,400, which is 6.5 percent above June 2014 and surpasses the peak median sales price set in July 2006 ($230,400). June's price increase also marks the 40th consecutive month of year-over-year gains.

Price gains were dominated by the $500 k plus range with low-cost home (under $100k ) seeing prices drop 2.6%

As supply continues to drop...

Regional Breakdown

• June existing-home sales in the Northeast climbed 4.3 percent to an annual rate of 720,000, and are now 12.5 percent above a year ago. The median price in the Northeast was $281,200, which is 3.9 percent higher than June 2014.
• In the Midwest, existing-home sales rose 4.7 percent to an annual rate of 1.33 million in June, and are 12.7 percent above June 2014. The median price in the Midwest was $190,000, up 7.2 percent from a year ago.
• Existing-home sales in the South increased 2.3 percent to an annual rate of 2.20 million in June, and are 7.3 percent above June 2014. The median price in the South was $205,000, up 7.2 percent from a year ago.
• Existing-home sales in the West rose 2.5 percent to an annual rate of 1.24 million in June, and are 8.8 percent above a year ago. The median price in the West was $328,900, which is 9.9 percent above June 2014.

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At least we now know where the $200 billion in outflows from China went...

[SeekAndFind]

MORE HERE:

The US housing market is on fire

[Dilbert San Diego]

Houses are like stocks??

During the housing bubble some years ago, at that time, I heard that about 30% of homes were owned by investors, not by owner occupants. So people treating housing as an investment, and not just buying a house because they want to live in the house, is nothing new.

But are we repeating mistakes of the past, if we are pushing easy mortgages as a means of people acquiring real estate??? Is that wise???

[Mikey_1962]

Not in Northeast Ohio.

[SeekAndFind]

The Chinese angle, don’t forget the Chinese angle.

Millionaires in China ( of which there are many ) are repatriating their money and putting them in Canada, Australia, New Zealand, the UK and yes, the good old US of A.

My wife, a real estate agent sold several houses the past year — ALL OF THEM TO CHINESE BUSINESSMEN ( we live in NY ).

[angcat]

Not in NEPA

[headstamp 2]

Key word here also is “existing homes”.

I would also like to know how many of these are foreclosure purchases by house flippers.

[oblomov]

The Fannie/Freddie bubble has popped, and it is not coming back for a very long time.

[Lorianne]

It is another bubble.

However, if you are planning to sell now is a good time to do it. Then hang on to the money for after the bubble bursts and you can pick up a nice house for cheap.

[woodbutcher1963]

I do not see that here in New England as far as easy money. The mortgages being issued around here are based on 10-20% down or more. Existing homes in my town are selling fast. I have seen homes go under contract anywhere from $275K to $800K.

[illiac]

We are seeing a lot of cash purchases her in north Idaho....investors have come back with a vengeance.

Problem is, they are paying top dollar for small homes and those wishing to refinance are seeing those values and hope their homes appraise for much more than they are really worth.

We saw this back in the boom years and everyone lost their shirts.

Appraisers are once again being challenged to inflate values by the home owners which will ultimately lead to being upside down once again.

[Uncle Miltie]

Good thing the Fed isn’t creating any inflation by creating too much money.

[headstamp 2]

Yep, too much cheap money chasing too few opportunities.

Bubble city.

[pleasenotcalifornia]

May neighborhood is turning over like crazy with new buyers all of whom bought homes with just 5% down.

[P.O.E.]

How many are foreclosures?

[Cementjungle]

On my street alone, two empty lots sold several months ago and spec houses are going up ($1 million range), and flippers bought my neighbor's house (auction) and another one across the street (was bank owned after the cops ran out the Mexican nationals who had a major pot growing operation going on in it).

In Los Angeles, people are buying up little old houses and putting up $2 million houses with zero lot lines.

[thirst4truth]

No, not wise, just raise the interest rates a little , like a quarter or half point, the heat for housing will cool down in a week.

The feds are committing the same mistake. Tons of FHA and 0% loans are still being written. In my rural southern Oregon, low income people can qualify for the USDA loan 0% down, seller concessions, seller pays loan fees, escrow and insurance and taxes for the buyer. The buyer gets in with at most $500 down, most of the time they get it back at closing. Can't find a rental that cheap.

[gop4lyf]

Putting mine on the market hopefully in 2-3 weeks. Needs some cleaning and some touchups. Hope to make a little off of it. Bought a new home about 45 miles north of Dallas, and moved this past weekend. I think I lost 20 lbs in sweat!

[PoloSec]

Caveat Emptor!

[packrat35]

Here we go again. Last time, I saw articles like this, we had a economic collapse shortly after...