Home Resales Slip But Median Price at $214,200, Up 13.5%

Home Resales Slip But Median Price at $214,200, Up 13% Dragged down by diminishing “short sales” and fewer purchases of foreclosed homes, overall home resales declined in June — but the median price saw the seventh straight month of a double-digit,  year-over-year increase, according to the National Association of Realtors.
The national median existing-home price for all housing types was $214,200 in June, up 13.5 percent from June 2012, the Realtors said Monday.
This marks 16 consecutive months of year-over-year price increases, which last occurred from February 2005 to May 2006.
Total sales of existing homes, which include completed transactions of single-family homes, townhomes, condominiums and co-ops, dipped 1.2 percent to a seasonally adjusted annual rate of 5.08 million in June, from a downwardly revised 5.14 million in May.
But home resales are 15.2 percent higher than the 4.41 million-unit level in June 2012.
There is still enough momentum in the market to keep the housing recovery on track, even with higher interest rates, said Lawrence Yun, NAR chief economist, said
“Affordability conditions remain favorable in most of the country, and we’re still dealing with a large pent-up demand,” Yun said.  “However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.07 percent in June from 3.54 percent in May, and is the highest since October 2011 when it was also 4.07 percent; the rate was 3.68 percent in June 2012.
Total housing inventory at the end of June rose 1.9 percent to 2.19 million existing homes available for sale, which represents a 5.2-month supply at the current sales pace, up from 5.0 months in May.
Listed inventory remains 7.6 percent below a year ago, when there was a 6.4-month supply.
“Inventory conditions will continue to broadly favor sellers and contribute to above-normal price growth,” Yun remarked.
Distressed homes – foreclosures and short sales – were 15 percent of June sales, down from 18 percent in May, and are the lowest share since monthly tracking began in October 2008; they were 26 percent in June 2012.
The decline in sales of distressed homes, which typically sell at a reduced price, accounts for some of the price growth.
Eight percent of June sales were foreclosures, and 7 percent were short sales.  Foreclosures sold for an average discount of 16 percent below market value in June, while short sales were discounted 13 percent.
NAR President Gary Thomas, broker-owner of Evergreen Realty in Villa Park, Calif., said some owners who were hurt by the downturn are now in the market.
“Rising values have improved the position of homeowners, and 16 percent of Realtors surveyed in June report they worked with a client that previously had an underwater mortgage,” Thomas said.
Of those previously underwater owners, 53 percent were planning to buy another home and 22 percent intended to rent, with 25 percent not sure what they would do, Thomas said.
In addition, 47 percent of Realtors report they have potential sellers who are waiting for additional price appreciation before they sell, he said.

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