The good news This Week in Real Estate was the U.S. economy was in even better shape that we thought. The U.S. economy grew 3.7% in the second quarter, much higher than the first official estimate on growth of 2.3% and even higher than what economists were projecting, according to the Commerce Department’s measure of gross domestic product, the broadest measure of economic activity. Like the prior week’s closing and start of this week the stock market experienced continued volatility, but unlike the first few days the week ended in historical fashion. The Dow finished Thursday up 369 points and combined with Wednesday’s 619-point rally, it was the best two-day point gain for the Dow in its history, surpassing the previous record set in 2008. Below are a few of the highlights from the third week in August that influence our business:
* Pending Sales Maintain the Ride Up. The Pending Home Sales Index increased in July for the sixth time in seven months. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), increased 0.5% in July from an upwardly revised June report, and is up 7.4% from the same month a year ago. The positive pending sales report follows a strong 5.4% increase in July new home sales reported two days ago, and the 2.0% increase in July existing sales reported last week. Following a week of wrenching equity market volatility, improved home sales, coupled with a strong GDP report today, suggests continued good news for the existing sales market and for builders in 2015. Year-over-year, the PHSI was up 12.1% in the Northeast, 7.5% in the West, 6.5% in the South and 5.7% in the Midwest.
Full Story… http://eyeonhousing.org/2015/08/pending-sales-maintain-the-ride-up/
* RealtyTrac’s July 2015 U.S. Home Sales Report. A total of 1,344,129 single family homes and condos sold in the first six months of 2015, according to public record sales deeds collected by RealtyTrac, the highest number of sales in the first half of any year since 2007. The U.S. median home sales price in July was $189,500, up 2 percent from the previous month and up 2 percent from a year ago to the highest level since September 2008. “While the stock market may be on a roller coaster as of late, the housing market is still on solid ground, with eight-year low in cash sales combined with the eight-year high in overall sales volume in the first half of the year evidence that housing is successfully transitioning from an investor-driven recovery to one that is drawing in traditional buyers as a good foundation for sustainable growth going forward,” said Daren Blomquist, vice president at RealtyTrac. Full story… http://www.realtytrac.com/news/home-prices-and-sales/july-2015-u-s-home-sales-report/
* MBA Forecasts Housing Demand Over Next 10 Years. The Mortgage Bankers Association (MBA) has just released a paper, Demographics and the Numbers Behind the Coming Multi-Million increase in Households, forecasting housing demand over the next ten years. Their study used date from 1975 – 2014 a period encompassing several market and housing cycles and the short version of its conclusion was the “By 2024, demographic and economic changes will bring what could be one of the largest expansions in the history of the U.S. housing market – 15.9 million additional households.” Even if household formation remains at 2014 low rates, demographic changes alone should account for 13.9 million new households by 2024. Full Story… http://www.mortgagenewsdaily.com/08282015_housing_demand.asp
* International Buyers Flow Into U.S. Housing Market, China Tops List. This year, for the first time since the National Association of Realtors has tracked foreign buyers of U.S. real estate, buyers from China have surpassed for the first time Canadiens, Europeans, Mexicans and Middle Eastern home buyers as the top overseas purchasers of homes in the United States. Chinese investment in U.S. residential real estate has grown from a measly $50 million in 2000 to an eye-popping $28.6 billion in the year ending in March 2015, up 72 percent from a year earlier, double the amount spent a year earlier, surpassing all other foreign buyers. All told, overseas home buyers spent a record $104 billion buying U.S. homes in the 12 months ending in March 2015, with Chinese buyers leading the pack. In the 2014 survey, foreigners spent $92 billion on U.S. homes over a 12-month period, up 35 percent from a year earlier. Chinese buyers are now the biggest international buyers of U.S. real estate in terms of dollar volume, total units, and average price paid. Moreover, 76 percent of Chinese buyers pay cash. Full Story… http://www.realtytrac.com/news/company-news/international-buyers-flow-into-u-s-housing-market-china-tops-list/
Have a productive week!