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Did US Housing Just Reach A Tipping Point?
Even if I were inclined to positive spin -- and I'm obviously not -- I'd be hard pressed to put lipstick on the pig that was Thursday's pending US home sales headline.
Contract signings across America's hopelessly distorted housing market fell 5.5% in July, according to the NAR. That doesn't sound all that bad until you consider that consensus expected a gain.
The decline pushed the index to yet another new record low.
Suffice to say the uptick seen in June was a false dawn. Another one. Co
Mortgage rates may be at multi-month lows but 6-7% is still a looooong way from the 2 & 3-handle options that were out there for much of recent memory. And with everyone in the world expecting Fed rate cuts and perhaps much lower rates, it’s not at all surprising that would-be buyers be still sitting on their wallets and waiting. And between still-high refi rates and an expectation that demand may accelerate as those wallets get finally opened, I don’t expect floodgates to open quickly for existing homes.
I don’t know how the balance of low rates spurring demand vs. spurring supply, or economic weakness pushing rates lower still may play out, but for investment property that’s appreciated 50%+ in the last 4 years, seems like a good time to take profit.