There were stirrings of a spring market
in April as both existing home sales and the inventory of available homes
increased. The National Association of
Realtors® (NAR) said that home price growth also slowed, an encouraging sign of
Existing home sales which include
completed transactions on single family and town homes, condominiums, and
coops, rose 1.3 percent in April to a seasonally adjusted annual rate of 4.65
million. It was the first increase thus
far in 2014 and sales remain 6.8 percent below the 4.99 million unit rate in
April 2013. March sales were at a rate
of 4.59 million.
Sales of single-family homes improved by
0.5 percent to a seasonally adjusted annual rate of 4.06 million in April from
4.04 million in March, but are 7.7 percent below the 4.40 million pace a year
ago. Existing condominium and co-op sales
rose 7.3 percent to an annual rate of 590,000 units in April from 550,000 units
in March, but are unchanged from April 2013.
Lawrence Yun, NAR chief economist, said
the improvement was expected. "Some
growth was inevitable after sub-par housing activity in the first quarter, but
improved inventory is expanding choices and sales should generally trend upward
from this point," he said. "Annual home sales, however, due to a sluggish first
quarter, will likely be lower than last year."
The inventory of existing homes jumped
16.8 percent to 2.29 million, a 5.9 month supply compared to 5.1 months at the
end of March. The unsold inventory is
6.5 percent higher than a year ago, when there was a 5.2-month supply.
"We'll continue to see a balancing act between housing inventory and price
growth, which remains stronger than normal simply because there have not been
enough sellers in many areas. More inventory and increased new-home
construction will help to foster healthy market conditions," Yun said.
Home values continue to appreciate but the pace is slowing. The median existing-home price for
all housing types in April was $201,700, which is 5.2 percent higher than in April
2013 while median prices increased by 8.6 percent on an annual basis during the
first quarter. The median existing
single-family home price was $201,100, in April representing a 4.7 percent
annual increase and the median condo price rose 8.3 percent to $205,500.
As NAR reported earlier this month, the market share of all-cash purchases
has risen recently despite a downtrend in distressed home sales and investor
activity. All-cash sales comprised 32 percent of transactions in April,
compared with 33 percent in March and 32 percent in April 2013. Individual
investors, who account for many cash sales, purchased 18 percent of homes in
April, up from 17 percent in March; they were 19 percent in April 2013. Seven
out of 10 investors paid cash in April. First-time buyers continue to represent
less than one-third of all buyers at 29 percent in April, the same as a year
earlier but one percentage point below the share in March.
Ten percent of sales in April were foreclosures and 5 percent were short
sales. The combined market share was
down from 18 percent one year earlier. Foreclosures
sold for an average discount of 16 percent below market value in April, while
short sales were discounted 10 percent.
NAR President Steve Brown said there was some heating of the market last
month. "The typical time on market shrunk in April, with four out of 10 homes
selling in less than a month," he said. "Homes that show well and are
properly priced tend to sell the fastest. More housing inventory gives buyers
better choices, and takes the pressure off of the buying process, which is a
welcome sign, especially for first-time buyers."
The median marketing time for all homes was 48 days compared to 55 days in
March and 43 days one year earlier.
Short sales took a median of 96 days to close and foreclosure 56 days
while non-distressed properties sold in 45 days. This was the fourth straight
month that marketing time improved. NAR
said this reflected the prolonged lag in inventory compared to demand.
Sales were mixed on a regional basis with the West making the best showing
with an increase of 4.9 percent to an annual rate of 1.08 million units. This is still 10 percent below the pace in
April 2013. The median price of a home
in the West was $291,200, 9.7 percent above the price in April 2013.
Sales rose to a lesser extent in the South, increasing 1.0 percent to an
annual rate of 1.94 million units, 3.5 percent lower than a year earlier. The median price was $173,200, up 3.2 percent
from a year ago.
Sales were unchanged in the Northeast at an annual rate of 600,000. This was 6.3 percent below the level 12
months earlier. The median price in the
Northeast declined 0.4 percent to $244,000.
Existing-home sales in the Midwest slipped 1.0 percent in April to a pace of
1.03 million, and are 9.6 percent below a year ago. The median price was
$157,200, which is 5.8 percent above April 2013.