Home Sales To Slow In June

Ten-X has released its latest Ten-X Residential Real Estate Nowcast, which projects existing home sales to remain fairly range-bound in June. According to the Ten-X Residential Real Estate Nowcast, June existing home sales will fall between seasonally adjusted annual rates of 5.38 and 5.74 million, with a targeted number of 5.56 million – a slight 0.5 percent increase from May and a 1.4 percent year-over-year gain.

“Despite facing broader economic headwinds following a disappointing May jobs report, slowing U.S. GDP growth, and uncertainty in global markets, the U.S. housing market remains on solid footing,” said Ten-X Chief Economist Peter Muoio. “We continue to hold a positive outlook for housing supported by accelerating wage growth, an accommodative labor market and low interest rates, though persistent issues with declining affordability and low inventory will likely limit stronger gains in sales.”

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The National Association of Realtors (NAR) recently reported a 4.5 percent year-over-year increase in sales to 5.53 million units in May, rising from a downwardly revised 5.43 million rate in April and marking the highest annual sales rate since February 2007. Last month’s Ten-X Residential Real Estate Nowcast also called for an increase in May sales between 5.47 and 5.83 million units, with a target of 5.65.

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The NAR also reported a 4.7 percent year-over-year increase in median existing home prices to $239,700 for May, marking the 51st consecutive month of year-over-year gains and nearly matching the prediction of $238,418 that Ten-X made in last month’s nowcast. Findings from the Ten-X Residential Real Estate Nowcast now suggest that sales prices for existing homes will fall between $231,642 and $256,025 in the month of June with a targeted price of $243,833, representing 1.7 percent month-over-month and 3.1 percent year-over-year gains.

“It will be interesting to see if the recent Brexit vote will have a measurable near-term impact on the U.S. housing market,” said Ten-X Executive Vice President Rick Sharga. “We could see interest rates reach a new low, possibly stimulating buying activity by improving affordability. Or we could see an influx of foreign capital, as investors look towards U.S. real estate in a flight to safety. Either of these could significantly change the current market trajectory.”

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