Good News Builds in Housing Market
Housing Starts, Building Permits and New Home Sales were on the up and up in June.
After three straight monthly declines, Housing Starts jumped in June, surging 8.3 percent from May, the Commerce Department reported. This is the highest level since February. Single-family starts, which represent the largest share of the residential housing market, rose 6.3 percent. Housing Starts also were up 2.1 percent from June 2016.
June Building Permits, a sign of future construction, also rose 7.4 percent from May’s revised figure to an annual rate of 1.254 million.
New Home Sales edged higher too. The Commerce Department reported June New Home Sales rose a modest 0.8 percent from May to an annual rate of 610,000 units, which was in line with estimates. From June 2016 to June 2017, sales rose 9.1 percent.
Existing Homes Sales slipped, though, falling 1.8 percent from May to June to an annual rate of 5.52 million units. The National Association of REALTORS® (NAR) said Existing Home Sales were up only 0.7 percent year over year, the second lowest reading of 2017. The NAR said the decline in sales was due in part to a low supply of homes for sale on the market. Total housing inventory was at a 4.3-month supply at the June sales pace and has fallen year over year for 25 consecutive months. Normal inventory levels are around six months.
Home price gains remain steady. The May S&P/Case-Shiller 20-City Home Price Index rose 5.7 percent year over year, in line with estimates and just below the 5.8 percent in April. Demand for homes continues to outweigh supply in many key areas across the nation, driving home prices up.
If you or anyone you know has any questions about home loans, please don’t hesitate to ask. At this time, home loan rates remain near historic lows. Be sure to look for next quarter’s issue of Homes & Money Newsletter coming to you in November.