Not surprisingly, existing home sales in the US posted a meaningful decline in Monday’s lonely macro update out of the world’s largest economy.
I say “not surprisingly.” Economists were surprised. Consensus expected a small drop. Instead, closings fell almost 4% from the prior month.
The annual pace, an uninspired 3.98 million, nearly matched a record low.
“Lower consumer confidence and softer job growth continue to hold back buyers,” NAR chief economist Lawrence Yun sighed. (Consumer sentiment in the Michigan gauge hit a record low early this month amid war angst.)
It’s the same story month in and month out. Rates, even after falling sharply from last year’s highs, still felt punitive to many would-be buyers and financing costs have since retraced higher along with Treasury yields on the read-across from the oil shock.
At the same time, there’s scant relief (where there’s any at all) on the price side. The median price was $408,800 last month, a new March record.
Annual price increases are re-accelerating into the spring buying season, even as sellers are discounting at a record rate. The 1.4% YoY increase was the briskest in four months.
The good news is, the “typical homeowner” has racked up nearly $130,000 in housing wealth since the pandemic, Yun added.
The NAR cut their forecast for full-year sales in Monday’s release citing higher mortgage rates.
Let them eat cake and live under the bridge.
This might be part of the problem:
https://www.wsj.com/us-news/a-50-property-tax-hike-proposal-is-tearing-this-massachusetts-town-apart-dc1f66ca?st=LjgPJq&reflink=article_copyURL_share
Median age of US housing stock is 44 years. The cost to bring older housing up to modern standards or to maintain is much more expensive than people realize. As an experienced homeowner of older homes, I am educating my kids about this cost that real estate brokers pretend either doesn’t exist or is a “just a minor repair/expense”.
I’m always looking at real estate and more and more, I am seeing properties that are 40-50 years old that either just redid all electric/plumbing or need it. This costs a lot of money and sellers have their heads in the sand.
+1. I would also add 30-40 year-old HVAC systems. Here in SoCal, our nation’s current immigration policies have also thinned-out the skilled workforce that were willing and able to do electrical, plumbing, HVAC, and roofing work at a reasonable prices.
“At reasonable prices. . . .”
My house is only 30 years old and there’s always something seemingly breaking lately: failing garage door sensors, microwave on the fritz, leaky faucets, pets heads falling off…
People have to learn to fix their own houses. It is not hard, just hard work.
And a colossal waste of precious time for valuable people like us!