After a strong 4th Quarter in 2013, this year started with a fizzle. Most of this can be attributed to the frigidly cold winter that hit the entire Northeast. Starting in March the housing market started to pick up steam and never slowed down. Existing-home sales have risen for 5 straight months and in July hit the highest pace of the year.
Jobs are always important for home sales, and over the past year we have seen jobs grow by over 2.6 million. Even with a strong economy that is producing many new jobs the interest rates refuse to increase.
The inventory shortage is also improving, inventory hit a 2-year high in the month of July. Most buyers like to view between 12-15 homes on average before they choose "the one." The increase in homes on the market allows todays buyers to find more of the options they are looking for during their search. What's even better, all-cash investors are stepping back, which allows the first-time home buyer a better chance of getting into the market.
The bottom of the market has much less of a strangle hold on our area. Distressed property sales (REO and short sales) are at their lowest point since 2008. The national average of distressed sales this July was 9%, down from 15% the same time last year. Also, the taxpayer funds used to bailout Fannie Mae and Freddie Mac have been fully paid back.
The housing market is steadily improving, and the growth potential remains strong thanks to pent-up-demand. For all of the reasons stated above the NAR (National association on Realtors) predicts growth in four of the next five years nationally. The one down year simply reflects the fact that data never moves in a straight line in any direction.
Chris Lawlor
Coldwell Banker Heritage
610-250-8880
CLawlor@cbheritage.com
