December 2016 News

Existing Homes Sales Report

According to the National Association of Realtors®, sales of existing homes in October rose for a second consecutive month, overtaking June's sales peak to become the swiftest annualized pace in almost ten years. Each major region saw monthly and annual sales growth in October.

Total existing-home sales (for single-family homes, townhomes, condos and co-ops), increased 2% to a seasonally adjusted annual rate of 5.60 million in October from 5.49 million in September. October's sales velocity is 5.9 percent higher than one year ago (5.29 million), eclipsing June's pace (5.57 million) to become the highest since February 2007 (5.79 million).


Existing Home Sales By
Region

NAR's chief economist, Lawrence Yun, indicated that the flurry of sales activity in the last two months represents a marked uptick for the housing market. "October's strong sales gain was widespread throughout the country and can be attributed to the release of the unrealized pent-up demand that held back many would-be buyers over the summer because of tight supply," Yun said. The economist added, "Buyers are having more success lately despite low inventory and prices that continue to swiftly rise above incomes."

Housing Data Takeaways

  • Nationally, October's median existing-home price for all housing types was $232,200, an increase of 6% over October 2015 ($219,100). October's price increase represents the 56th straight month of year-over-year gains.
     
  • Total housing inventory by the end of October fell 0.5% to 2.02 million existing homes available for sale, and now sits 4.3% lower than one year ago (2.11 million), and has dropped year-over-year for 17 consecutive months.
     
  • Freddie Mac data shows that the average commitment rate for a 30-year, conventional, fixed-rate mortgage moved up slightly in October for the second month in a row, to 3.47% versus 3.46% in September. The average commitment rate for all of 2015 was 3.85 percent.
     
  • First-time buyers generated 33% of sales nationally in October, down from September's 34% but up from 31% a year ago.
     
  • Distressed sales (short sales and foreclosures) grew slightly to 5% in October, up from 4% in September and down from 6% one year ago.

Ready for Winter?

Winter is one of our favorite times of the year! It's often easy to overlook your home's needs with so many activities happening. Here is a simple checklist of items that can save you money through the winter:

  • Check for leaks and drafts around the house. Replace weather stripping and re-caulk around doors and windows. Drafty doors and windows will cool off the house and cost you money in heating bills.
  • Inspect your attic's insulation. Heat rises so adding good insulation can keep the heat from escaping.
  • Check your heating system. Sometimes something as easy as replacing your filter or having simple maintenance done can save on heating costs.
  • Consider changing from standard light bulbs to energy saving bulbs. Winter uses a lot of your electricity so even saving a little here and there will help.

Whether you live in a warm or cold climate, take this opportunity to inspect your home systems. You'll be money ahead in the long run!

Investing in Real Estate

Today's low interest rates and stabilized home prices have created some great investment opportunities!

Investing in real estate has unique advantages over other types of investments. Of course, wise investors may have various instruments in their portfolio, but real estate has a long-term track record of proving its worth.

Here are some of real estate investing's advantages:

  • Interest in mortgage loans are tax-deductible. Investors can lower their tax liability while increasing their equity.
  • Renters pay down your mortgage loan. Investors reap the benefits of rental income, which offsets your mortgage cost and build equity.
  • Real Estate values increase over the long term. Real Estate is limited and will always be in demand. 
  • 1031 exchanges are available to defer taxable income when you are ready to sell.

Many investors are taking advantage of these great market conditions. Have questions? Give us a call. We are happy to help!

 

 

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