Today, the National Association of Realtors (NAR) released their Existing Home Sales Report for June showing that an increasing fall-off in demand for residential real estate is occurring uniformly across the nation’s housing markets.Senior Economist Lawrence Yun is now suggesting that the weakness is mostly as a result of the increasing interest rates, tightening lending standards and home buyers getting mixed signals about the state of the market.
“Home buyers have been getting mixed signals about the housing market, which is causing some of them to hesitate, … Mortgage interest rates have risen recently, and tightening lending standards are continuing to hamper sales, but fewer risky loans will put the market on a healthier path. Although general buying conditions remain favorable for long-term home buyers, it appears some buyers are looking for more signs of stability before they have enough confidence to make an offer.”
Additionally, NAR President Pat Vredevoogd Combs continues to attempt to persuade potential buyers to ignore the obvious dramatic housing correction.
“Consumers should avoid making decisions based on what they hear about the national market because all real estate is local, … There are pockets around the country where home sales are quite strong, so you really need to consult with a knowledgeable real estate professional about local market conditions – experience is one way Realtors® add value to the real estate transaction, and a reputable agent is your best resource to navigate the current market, whether it’s moving up or down,”
Looking at June’s Existing Home Sales report should only result in additional confirmation that the nation’s housing markets are continuing to experience weakness with EVERY regions showing considerable declines to sales as well as continued increases to inventory and monthly supply.
It’s important to note that June is traditionally the best month for sales so although we are seeing significant weakness to sales as compared to last year’s results, the greater number of sales in this peak months results are likely disproportionately impacting both inventory and “months of supply”, making them appear to be decelerating.
Sales are essentially all down here from now for the remainder of 2007 and both inventory and “months of supply” should resume the bloating with every remaining month.
Keep in mind that we are now seeing existing home sales declines on the back of last years fairly dramatic declines further indicating that the housing markets are not bottoming as many had been suggested last fall.
Below is a chart consolidating all the year-over-year changes reported by NAR in their June 2007 report.
Particularly notable are the following:
- ALL sales are down with the worst coming from the West where sales were down in the high double digits for all product types.
- ALL Inventory and Months Supply show significant increases on a year-over-year basis.
