Where the Housing Market Stands – Pre-President Trump
In the aftermath of the election of Donald Trump as U.S. president, questions have been flying about what will happen next. Some relish the thought of Trump “draining the swamp” and reforming the federal government. Others worry that the Trump reforms could devastate the housing and other home related markets.
But before we know where we’re going, it’s important to look at where various housing market indicators stand in mid-November, two months before the Trump regime begins. That will provide a benchmark for what happens with homes.
Here are some of the most recent relevant statistics on housing sales, construction, foreclosures and more. GoodCall will track many of these stats going forward to get a read on the housing/moving market:
The day after the election, the average 30-year mortgage rate increased to 3.73 percent from 3.69 percent the week before, according to Bloomberg.com. Experts predicted the rate would climb to nearly 4 percent by the end of this week. What it means: First-time buyers could be hindered, particularly if the climb continues.
Pending home sales: Pending home sales encompass situations where a contract has been signed but the sale has not been finalized. They increased 1.5% in September, the latest month for which statistics were available, according to the National Association of Realtors Pending Home Sales Index. They were 2.4 percent higher than the same month a year ago. NAR’s chief economist, Lawrence Yun, credited the jump to better sales in the West and the South.
Existing home sales: NAR’s numbers show a 3.2 percent increase in existing home sales for September. Sales were up about 0.6 percent from the same month of 2015. Yun attributed the increase to first-time buyers, who made up 34 percent of sales – the highest level in four years.
Housing affordability: This is another set of numbers from the NAR. The organization puts the median price of existing single-family homes at $235,700 in September. That was down from $241,900 in August but up from $223,300 in September 2015. Prices were lowest – by far – in the Midwest and South.
Median sales price of a foreclosure home: RealtyTrac says the median sales price of a foreclosure home in September was $130,000 – up 0.1 percent from the year before. However, that was about 44 percent lower than the median sales price of a non-distressed home.
National Housing Scorecard: This report comes from the federal Department of Housing and Urban Development. It found purchases of new homes up 3.1 percent in September – 29.8 percent from the same month of 2015. It says foreclosure starts fell in September to 34,685 – the lowest level in more than 11 years.
Housing starts and building permits: The National Association of Home Builders stats lag by six months but again set an important benchmark. The annual rate of total U.S. housing starts in May was nearly 1.2 million. About 764,000 single-family homes were started in that month. More than 1.1 million building permits were issued.
Where will the numbers go from here? It’s uncertain, of course, and if nothing else, the election dispelled the notion of predictions. But these figures provide a benchmark for what’s coming.