Housing Indicators You Need to Know About | Real Estate Today ...

We?ve all heard the popular term ?what?s trending.? Well, when you apply that to real estate you?ll find that today, we?re better off than we were one year ago. Yep. We?re trending positive.

In all of the four major indicators ? we?re doing better. And if that trending continues ? we?ll be doing even better one year from now.

So let?s take a look at those indicators, one by one. And we?re talking about home sales, home prices, inventory and interest rates. So here we go.

First off, home sales. When you compare June of this year ? with June one year ago? Home sales are four and one half percent higher now, than they were.

That?s right. Nationwide, the numbers are showing that more people are shopping for homes again. It seems that people who were on the fence have hopped off ? and they?re looking at homes, writing contracts and going to the settlement table.

So indicator number one, home sales? We?re up.

Now, indicator number two: Home prices. And here?s more good news.

The national median existing-home price for all housing types in June was one hundred eighty nine thousand dollars, according to the REALTOR? trade association. As we have often told you, the median is the price point at which half of the homes sold for more and half sold for less. That number is up nearly 8 percent from one year ago.

And that bears repeating; from June 2011 to June 2012 median home prices are up 8 percent.

June?s home price gain actually was the strongest since February 2006. That?s a promising sign. If the trend continues, as forecast, more home owners soon may see steady equity growth in their homes.

So again, indicator number two, home prices? We?re up.

Now, indicator number three ? inventory.

Inventory, of course, refers to the number of homes that are for sale. If there?s too much inventory, prices stall, or dip but if there?s not enough? Prices tend to rise.

And year-to-year? There are far fewer homes for sale in June 2012, compared to June of last year. At the end of this June, inventory levels were 24 percent below year ago levels. That?s pretty significant.
Yet, buyer traffic reportedly has doubled from last fall. We have a lot more people wanting to buy, but fewer homes for them to choose from.

This has prompted some economists to even predict a housing shortage in future years.

We?ve gone in just a few years from too many homes for sale, to not enough. If the housing shortage occurs, prices will likely move even higher as buyers scramble for whatever they can get.

So, indicator number three: housing inventories? They?re down?which is very good news for home prices.

Finally, the fourth indicator is one that makes headlines just about every week: And that?s mortgage interest rates.

One year ago, and we?re talking the second quarter of 2011, remember what interest rates were back then? Well, at that time, 30 fixed-rate mortgages? averaged 4.7 percent.

But in the second quarter of this year, 30 rates are nearly 1 lower, averaging 3.8 percent.

Great news for anyone buying but also great news for anyone selling too, since those ultra-low rates will have people lining up to see every house that comes on the market. Great news also for people staying put because refinancing is super affordable, and people can either pay less every month, or shorten their mortgage term and either way, that?s great news.

So where are mortgage rates heading? Well, no one can be certain. The Mortgage Bankers Association in its most recent forecast is predicting that one year from now, in the second quarter of 2013, 30 year rates will be at 4.2 percent so basically inching back up to 2011 averages.

Could 2012 then mark the bottom for interest rates? Possibly. The record-breaking streak in the second half of this year has been unprecedented and plenty of home buyers and home owners are rushing to take advantage.

So indicator number four ? interest rates? Good news for now but that?s one to watch carefully, as we look ahead.

So there you have it, four leading housing indicators in home sales, home prices, inventory levels, and mortgage rates. In all four areas, we?re looking much better than we were one year ago. The forecast looks bright too, for home sales, home prices and inventory and the only indicator we?re not quite as optimistic about is interest rates. Not sure whether those will stay low, or start back up.

But one thing?s for sure. Years from now when people talk real estate ? the year 2012 will be a big part of the conversation. Because anyone who bought a home, a second home or an investment property in 2012 will have bought at incredibly affordable prices, with the lowest interest rates, practically ever.

Yep. People will be talking about that for the rest of their lives.

Source: http://retradio.com/?p=5938

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