Home sales up 2% in October
Achingly slowly, the housing "rebound" is gaining steam. October's figures on previously owned home sales is 11% over last year, and 2% over September's figures.
Existing home sales rose to an annual rate of 4.79 million, seasonally adjusted, reported the National Association of Realtors on Monday. That's up 2.1% from September, when the revised annual rate of existing home sales was 4.69 million. And it's an increase of 11% year-over-year, when the annual rate was 4.32 million.
That was also stronger than the forecast from analysts at Briefing.com, which called for an annual rate of 4.7 million existing home sales in October.
The National Association of Realtors said that sales had gone up nationwide, "even with some regional impact from Hurricane Sandy," the deadly storm that caused massive disruptions in the Northeast at the end of October.
Lawrence Yun, the association's chief economist, said the market is being driven by "growing demand with limited inventory" but it could run into strong headwinds from Sandy going forward.
"We expect an impact on Northeastern home sales in the coming months ... in storm-impacted regions," he said.
Home buyers are being lured by low mortgage rates. Last week, mortgage rates dropped again, pushing 15-year and 30-year fixed-rated loans to record lows.
Also, the National Association of Realtors said last week that the median down payment has sunk to 9% for home buyers this year, its lowest level since 2009.
More good news: the inventory of existing homes has fallen to its lowest level since 2002. This means that home values are poised to rise in the near future.
But we're still a long way from recovery. When the number of homes sold reaches 6 million, we may begin to celebrate. That number represents a healthy market, where houses take weeks to sell once listed instead of months as is the case today.
Builders still aren't very optimistic, but no doubt next summer will be better than this previous summer and hirings in construction should pick up.