Leading Realtors Association Reports Housing Market: Hints of Recovery

June 25, 2012 / Russell Legato, Residential Property Analyst

The positive news in the real estate industry is that housing market: hints of recovery are very promising. For three months in a row, sales of private homes have increased significantly. The outlook is increasingly promising.

Leading Realtors Association Reports Housing Market: Hints of Recovery

Those prospective first time home buyers have held back long enough. They now see prices starting to rise on existing houses. That, coupled with still record-low interest rates makes this the optimal time to buy. Many others, who are looking for their second home, now see their best opportunity to get good prices on a property and low, low interest rates, especially on 30 year mortgages.

The number of days single family houses sit on the market is dropping steadily. For example, it took an average of 52.20 days in May of 2011. In April of 2011 it took 48.9 days. Compare those figures to the average number of days in May of 2012, which were 46.6.

More than 90 Realtor organizations contributed to compiling these figures. Statistics represent only single-family detached houses. Seasonal factors were not considered. Low sales volume in some parts of California had a notable effect on median price changes.

Sales have been at a low since February, 2009. At that time, 598,770 properties were purchased. This number is based on an annual rate and seasonal adjustments were considered. In April 2012 553,670 single family dwellings were sold at a rate adjusted to take seasonal fluctuation into account.

In May 2012 figures rose by 21.5 percent as compared to the previous year in May. That is the largest increase since May 2009.

Sale prices are rising and remaining level in California. Of course, some coastal cities are doing better than inland areas. San Francisco sees sales nearly booming compared to last year at this time. Statewide, the median price is $312,110 for a single family home in May.

A primary factor in activity is the fact that housing inventory has decreased in the state of California. It saw a reduction in May when the index of unsold properties dropped to 3.5 months figured at a rate of number of months needed to sell reserves. It is figured, based on a 7 month supply being the norm. There is a shortage of available homes in some areas such as San Mateo, Contra Costa and Santa Clara counties.

Thirty-year fixed rate mortgages are down to an unbelievable 3.80 percent. As a comparison, May 2012 saw interest rates of 4.64 percent on that same type mortgage.

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