June Marks Fourth Consecutive Month Of Existing Home Sales Gains
According to the latest National Association of Realtors data, in June sales of US existing homes increased 1.1% from May sales. This was the fourth consecutive month for existing home sales gains, and sales are up 3.0% from June 2015, now at their highest annual level, 5.41 million, since February 2007. According to NAR Chief Economist Lawrence Yun, “Existing sales rose again last month as more traditional buyers and fewer investors were able to close on a home despite many competitive areas with unrelenting supply and demand imbalances. Sustained job growth as well as this year’s descent in mortgage rates is undoubtedly driving the appetite for home purchases.” However, Yun cautioned, “Looking ahead, it’s unclear if this current sales pace can further accelerate as record high stock prices, near-record low mortgage rates and solid job gains face off against a dearth of homes available for sale and lofty home prices that keep advancing.” The AP attributes the rise to a “solid job market and mortgage rates near historic lows” that have kept demand steady. However, the article adds that “the number of listings on the market has fallen over the past year” as some home owners continue “rebuilding equity that vanished when the housing bubble began to burst.” Bloomberg News says the home-buying surge is a result of burgeoning wage growth, steady job gains, and low mortgage rates, but notes that June may have represented “the high-water mark for 2016.”
What This Means For Small Businesses
The housing market has been uneven since the recession. The latest existing home sales data indicates that we are seeing a period of housing growth. However, Federal economic policies have continued to contribute to market uncertainty across industries, including housing. Small businesses involved in the housing market, particularly those in the construction industry, are likely to see continued uneven growth as uncertainty lingers.
Additional Reading
Reuters also reports on the latest existing home sales data.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.
