August 19, 2011 (Brian Moore)
After two months of rising, home sales followed the traditional summer trend and declined in the month of July. Home sales fell 12.7 percent from June, but were up 13.1 percent from July of last year according to RE/MAX’s National Housing Report (NHR).
The impressive increase in sales from a year earlier was the first time that home sales had increased in year-over-year comparisons since January, but is likely due to the huge drop in sales last year following the ending of the home buyer tax credit.
The monthly decline in sales from June to July was also higher than the normal seasonal trend as strict lending standards, bad appraisals and overall concern about the economy contributed to the decline. Mortgage applications were affected by lenders who were already using the lower GSE and FHA loan limits that take effect on September 30.
Forty-five out of the 53 metro areas in the report experienced year-over-year increases in closed transactions. Des Moines, IA (+49.9%), Omaha, NE (+46.8%), Milwaukee, WI (+37.7%), Providence, RI (+32.4%), and Wichita, KS (+29.0%) recorded the highest gains in closed transactions.
Sales prices in July were just 0.18 percent lower than in June and were 4.6 percent lower than in July 2010. The median sales price in July 2011 was $193,042, down from $193,791 in June and down from a median sales price of $202,350 in July of 2010.
Only 11 of the 53 metro areas recorded higher prices in July than they did a year earlier. The best price performers were Detroit, MI (+14.3%), Birmingham, AL (+9.8%), Des Moines, IA (+7.7%), Orlando, FL (+5.5%), and Pittsburgh, PA (+4.4%).
The average number of days it took to sell a home in July was 88, which was down from 90 days in June. Inventory increased in July as the average months supply of inventory increased to 7.2 months, up from 6.9 in June, but down from a 9.3 months supply of homes in July 2010.
Inventory supply decreased the most in Miami, FL (-52.5%), Tampa, FL (-37.3%), Phoenix, AZ (-35.6%), Los Angeles, CA (-32.4%) and Chicago, IL (-26.9%).
“The fact that July home sales were higher than a year ago, and by such a significant amount, gives us reason for great optimism,” said Margaret Kelly, CEO of RE/MAX, LLC. “And now that prices have risen for four of the past five months, the housing market is beginning to show definite signs of recovery.”
Tags: RE/MAX, home sales, home prices, National Housing Report, market recovery, seasonal trends, closed transactions