Reports Show Peaks and Valleys in National Real Estate Market
The latest reports on the real estate market, both in South Florida and on a national level, are presenting mixed results. The Federal Housing Finance Agency (FHFA) has documented a rise in home prices, as has been the trend in recent months. However, the agency also notes prices may begin to decline or hold steady with minimal gains, an assertion which the National Association of Realtors® (NAR) latest findings support.
FHFA: Prices Rose in the Second Quarter
The FHFA’s House Price Index (HPI) came out recently, detailing the modest rise in home prices seen in the second quarter. Derived from the records of mortgages sold to or guaranteed by Fannie Mae and Freddie Mac, the HPI showed prices rose 1.2 percent during quarter two. Prices also increased 5.6 percent when comparing year over year figures. Florida brought in some promising numbers as well, cracking the top five for year-over-year ascensions with a 10 percent jump.
On the surface, the findings seem to be all good news. However, the FHFA also warned that home affordability may be slowing the progress the market has seen as of late. During the three months in the quarter, the HPI only rose by 0.2 percent month over month. Although it represented an upward change, it was minor when compared with previous quarters. Additionally, while the prices of homes increased, the prices of goods and services did not. Given this information, it is reasonable to assume that the market may shift in upcoming quarters.
NAR: Home Sales Slowed in July
Just as the FHFA’s report for the second quarter rolled out, support for the agency’s concerns became evident. The NAR recently announced that July saw a decrease in total home sales, bringing in lower numbers than in the previous years. Home sales dropped 3.2 percent, coming in at only 5.39 million for the month of July – a 1.6 percent drop from June. The association cited the low housing inventory and general frustrations over the increase in home prices on the part of buyers as possible reasons for this drop. Other key findings included:
Homes remained on the market for two more days on average than in June. At 36 days on average, this number still falls far below July 2015’s timeline of 43 days.
Sales of existing homes fell 1.8 percent in the South during the month of July.
First-time buyers made up 32 percent of the buyer pool – a slight drop from June’s 33 percent, but remaining above 28 percent in July 2015.
In this ever-changing market, the expertise of a seasoned South Florida real estate professional is more important than ever. If you’re interested in buying or selling a South Florida home, call our team today for the guidance you need to fulfill your real estate goals.