BIG DRIVERS OF THE HOUSING MARKET RECOVERY
The Wall Street Journal highlighted four primary reasons why the housing market recovery is strong. They are:
- Sales have made big leaps from year-over-year levels. Existing-home sales are up 9.7 percent compared to one year ago. Sales are at an annual rate of 4.97 million, which is the highest level since November 2009, according to NAR. Despite constrained inventories and recent price gains, home sales continue to post increases.
- Non-distressed home sales are increasing. Home buyers are showing high demand for non-distressed homes. In April, about 18 percent of sales were in foreclosure or a short sale — down from 28 percent year-over-year.
- Inventories have increased. In April, the number of homes for sale rose 11.9 percent from March. The limited supply — mixed with rising buyer demand — has helped home prices to rise around 10 percent year-over-year. “Rising inventory should ultimately slow some of the price rally while boosting sales volumes, helping to restore equilibrium in the housing market,” The Wall Street Journal reports.
- Homes are selling a lot quicker. About half of all homes that were sold in April were on the market for 46 days, down from 83 days one year earlier, according to NAR data.