Home Sales Nearing 8.5 Year High

Published Aug. 2015 by Reuters.com

U.S. home resales rose to a near 8-1/2-year high in July and factory activity in the mid-Atlantic region picked up this month, fresh signs of steady economic growth that likely keeps the Federal Reserve on track to raise interest rates this year.

While other data on Thursday showed a slight increase in the number of Americans filing new applications for unemployment benefits last week, the trend remained consistent with strong labor market momentum.

“We continue to expect both economic growth and labor market activity to continue shifting higher, providing the justification for the Fed to begin the normalization in monetary policy in September,” said Millan Mulraine, deputy chief economist at TD Securities in New York.

The National Association of Realtors said existing home sales increased 2 percent to an annual rate of 5.59 million units last month, the highest pace since February 2007.

Demand for housing is being boosted by a strengthening labor market. But supply remains tight, pushing up home prices and sidelining first-time buyers, who are a key part of a strong housing market. The share of first-time buyers fell to a six-month low of 28 percent last month.

There were 2.24 million unsold previously owned homes on the market in July, down 4.7 percent from a year ago. That pushed the median home price to $234,000, up 5.6 percent from the year-ago period. Although higher prices could curb sales, they are raising equity for many owners and boosting household wealth.

Conclusion.

On the plus side, with home values up 5.6 percent from a year ago, it means that your home may be worth more than ever.  On the other hand, the Federal Reserve continues to hint at an increase in interest rates, which will make it more difficult for buyers to afford your home.

The combination of these two factors suggest that now might be the perfect time to list your home.  You may want to take advantage of the new equity you’ve built over the last year before buyers are pushed out of the market by higher interest rates.

Please call our team for a Free Home Evaluation to determine the value of your home in today’s market.  And we can discuss the potential of selling your home during the Autumn months, before the market changes and before the busy holidays.

 

 

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