Photo: © Courtney Keating - iStockphoto
The June 2015 buying season was the strongest one since the economic downturn, with sales increasing to their highest pace in 8 years. This was the sixth month in a row that national home sales increased year over year. What's more, all regions of the country saw sales gains in June. Existing-home sales in the Northeast were 4.3 percent higher than a month ago and 12.5 percent higher than a year ago. In the Midwest, sales climbed 4.7 percent from May and were 12.7 percent higher than June 2014. Sales in the South and West rose 2.3 percent and 2.5 percent from a month ago, respectively. When compared with June 2014, sales were up 7.3 percent in the South and 8.8 percent in the West.
From "For Sale" to "Sold" in Record Time
Not only were more homes selling, they were also selling at remarkable speeds. Properties in June remained on the market for an average 34 days, down from 40 days in May. This set the record for the shortest selling time since the National Association of Realtors began tracking the statistic in May 2011. Forty-seven percent of all homes sold in June beat the 34-day sales pace by selling in less than a month.
A Bigger Investment
More buyers were looking for homes, but there were fewer homes available for sale. The high demand and short supply led to an increase in home prices in June, climbing to a national median all-time high of $236,400. In the Northeast, the median price was 3.9 percent higher than a year ago. The Midwest and the South both saw prices climb 7.2 percent higher than June 2014. The West, meanwhile, posted the highest year-over-year gains with 9.9 percent. Unfortunately, the high prices also affected home affordability for prospective buyers because more buyers were competing for higher-priced homes. To boost inventory, more building permits will need to be issued for condominiums and single-family homes.
Builder Confidence Rises
More builders are confident in the current housing market, because of improved job growth and strong sales in both the new and existing home markets. The National Association of Home Builders/Wells Fargo Housing Market Index climbed to a level of 60 in July (a number over 50 indicates there are more builders that see the current market as good, rather than poor.) Builders haven't been this confident in the market since November 2005. The index that measures builders' sales expectations for the next 6 months increased two points to 71.