Sustained job and income growth gave home buyers the confidence in July to jump into the California housing market, pushing home sales to their highest level in nearly three years, according to the
CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.).
Making sense of the story
Home sales have risen year over year for six straight months.
Home sales remained above the 400,000 mark in July for the fourth consecutive month and rose to highest level since October 2012. Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 449,530 units in July.
The July figure was up 2.7 percent from the revised 437,680 level in June and 12.7 percent compared with home sales in July 2014 of a revised 398,980.
The year-to-year change was the highest since July 2009 and significantly higher than the 6month average increase of 6 percent observed from January 2015-June 2015.
C.A.R. President Chris Kutzkey commented, “While July home sales rose at the statewide level, the market is still constrained by low housing affordability and a tight supply in areas where job growth is robust, such as San Francisco and San Jose. Neighboring regions such as Napa, Solano, and Sonoma are experiencing strong sales due to their affordability and proximity to job centers.
However, housing affordability could become a bigger issue in these areas if housing demand continues to grow but supply can’t keep pace.”
The median price of an existing, single-family detached California home dipped 0.3 percent in
July to $488,260 from $489,640 in June. July’s median price was 5.4 percent higher than the revised $463,330 recorded in July 2014.
While sales continued to improve from last year at the state level, the number of active listings dropped modestly from last year. Statewide, active listings increased 3.3 percent from June but dropped 4.5 percent from July a year ago.
Read the full story http://www.car.org/newsstand/newsreleases/2015releases/july2015sales
As a fresh sign of steady economic growth, U.S. home resales rose to a near 8-1/2-year high in July, which will likely keep the Federal Reserve on track to raise interest rates this year. Demand for housing is being boosted by a strengthening labor market. But supply remains tight, pushing up home prices and sidelining first-time buyers, who are a key part of a strong housing market. Although higher prices could curb sales, they are raising equity for many owners and boosting household wealth.
Read the full story http://www.reuters.com/article/2015/08/20/us-economy-jobless-idUSKCN0QP1AB20150820
Source: The Atlantic
Few Americans today say they know their neighbors’ names, and far fewer report interacting with them on a daily basis. According to data from the General Social Survey, only about 20 percent of Americans spent time regularly with the people living next to them. A third said they’ve never interacted with their neighbors. That’s a significant decline from four decades ago, when a third of Americans hung out with their neighbors at least twice a week. All this means that Americans are growing farther apart and talking less with people who have different opinions.
Read the full story http://www.citylab.com/housing/2015/08/why-wont-you-be-my-neighbor/401762/
Seven years after the real estate bust, many people who lost their homes have rebuilt their credit and are back in the market, which is supporting the return of America's growing ranks of "boomerang buyers."
About 700,000 of the 7.3 million homeowners who went through foreclosure or short sales during the bust have the potential to get a mortgage again this year. Experts say these boomerang buyers will be an important segment of the real estate market in the coming years. It generally takes seven years for a foreclosure to drop off a credit report.
Read the full story http://finance.yahoo.com/news/boomerang-home-buyers-poised-return-084629843.html
Source: Wall St. Journal
Older Americans, not those ages 25 to 34, are driving the uptick in new households. In fact, the rate has increased over the past year to reach the highest level since before the recession began in 2007, according to the Terner Center for Housing Innovation at the University of California, Berkeley. Americans created
1.27 million households during the year ended in June, and of those new households, 860,000, or about two-thirds, were created by Americans between 65 and 74 years old. Just 159,000, or 13 percent, were created by young people between 25 and 34 years old.
Read the full story http://blogs.wsj.com/economics/2015/08/18/seniors-not-millennials-are-the-ones-creating-newhouseholds/
Source: Eye on Housing
The Federal Reserve Bank of New York presented information on the number of mortgage originations by households grouped according to their credit score. The new information indicates that households with the strongest credit score receive the majority of mortgages while households with good credit, a category that historically received the majority of mortgages, have seen their share shrink. The share of mortgage originations granted to households with the most pristine credit expanded significantly beginning in 2008 and by 2010 accounted for half of all household mortgage originations. Households with strong credit scores continued to account for 50 percent or more of all mortgage originations to households until 2014.
Read the full story http://eyeonhousing.org/2015/08/the-majority-of-mortgages-go-to-households-with-the-strongest-credit/
Sales to first-time buyers fell to their lowest share since January due to stubbornly low inventory levels and rising prices, while existing home sales steadily increased for the third consecutive month in July.
The National Association of REALTORS® also reports that total existing home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2 percent to a seasonally adjusted annual rate of 5.59 million in July from a downwardly revised
5.48 million in June.
Read the full story http://www.housingwire.com/articles/34823-existing-home-sales-rise-for-third-month-in-a-row
Total mortgage application volume rose 3.6 percent on a seasonally adjusted basis for the week ending August 14 vs. the previous week, according to the Mortgage Bankers Association (MBA).
Refinance applications were the driver, jumping 7 percent from the previous week to the highest level since May, 2015 .
The refinance share of mortgage activity increased to 55.5 percent of total applications from 53.1 percent the previous week.