More Positive Data From The Housing Sector: Existing Home Sales AND New Home Sales Rise
As this week’s signal that homebuyers are returning to the market, both Existing Home Sales and New Homes Sales posted improvement versus month-prior figures this April.
According to the National Association of REALTORS, the number of Existing Home Sales rose by 130,000 units in April.
New Home Sales rose by a modest 1,000 units in April.
As a twist in the story, however, although sales activity is rising, the available housing inventory is rising faster.
Versus March 2009, there were 300,000 more homes for sale in April — an increase of 9 percent. In addition, the “housing supply” rose to 10.2 months, its highest level since October.
This is good news for home buyers, of course, because home prices are a product of Supply and Demand. Depending on local conditions, buyers may find themselves in a position to demand lower sale prices or additional seller concessions.
The housing market has not fully rebounded but it continues to show signs of strength. With a few more months like March and April, it’s reasonable to assume that homebuyers will lose some of their leverage for contract negotiation.
When that happens, expect home prices to rise.