Low Supplies, Higher Prices, Better Homes

Existing home sales have succumbed to the typical seasonal slowdown, but the National Association of REALTORS® says annual sales should end 10 percent higher than they were in 2012.

Housing sales are predicted to be just as high in 2014.

So what's driving housing sales?

Sales volume has remained above year-ago levels for the past 28 months.

October sales and prices are both up nearly 13 percent over October 2012. The median home price for all types of housing was $199,500, the 11th consecutive month of double-digit year-over-year increases.

The good news there is that equity homes are selling, and that's also bringing prices up. Foreclosures and short sales were only 14 percent of homes sold, down from 25 percent a year ago.

Prices are expected to end 11 percent above last year, and then cool down to about a five percent increase in 2014.

The National Association of REALTORS® says prices are shrinking affordability which will cool home sales volume. The first sign is the decrease in the number of first-time homebuyers, down three percent from 2012.

Currently, homes are at about a five-month supply nationwide, up slightly from September. One-third of homes sold in October were on the market less than 30 days.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.19 percent in October down from 4.46 percent in September.

If rates stay lower, that should offset rising prices for some homebuyers.

Contact me at leigh.young@cbgreatlakes.com

Leigh Young

Leigh Young

Realtor - Veteran Specialist
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