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Pending Home Sales Rise 4.5%
Pending home sales in January were up 4.5 percent month-over-month, and that was above expectations for a rise of 1.9 percent.
Pending home sales were up 10.4 percent on a year-over-year basis, beating expectations for a rise of 8.2 percent.
January’s number was also revised up to reflect a 1.9 percent decline, from the initial reading of a 4.3 percent decline.
Regionally, in the Northeast the pending home sales index (PHSI) were up 8.2 percent on the month, in the Midwest sales were up 4.5 percent on the month, in the South sales were up 5.9 percent, and in the West it was up a marginal 0.1 percent, and down 1.5 percent from a year ago.
In a press release, Lawrence Yun, NAR’s chief economist said, “Favorable affordability conditions and job growth have unleashed a pent-up demand. Most areas are drawing down housing inventory, which has shifted the supply/demand balance to sellers in much of the country. It’s also why we’re experiencing the strongest price growth in more than seven years.”
These recent pending home sales figures show that existing home supply is tight, especially in the West which is why home price increases in the region are increasing the most. Yun said he now expects 5 million home sales in 2013, down from 5.1 million.
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Home Buyers Wants Have Changed
What home buyers want when looking for their perfect abode have changed, according to a new study by the National Association of Home Builders.
The study found that home buyers are overwhelmingly much more cautious and sensitive to prices than before, but what’s really interesting is what tops buyer’s lists of must-haves in their new home.
It’s probably not a surprise to learn that energy efficient homes are priority number one for the vast majority of home buyers. The NAHB found that Energy-star appliances are essential number one in the eyes of many buyers, followed by energy efficient laundry rooms.
High-end amenities were cited by 62% of home buyers as being more important to them than available living space – in other words, most people are more than willing to sacrifice that extra bedroom or go with a smaller living room in order to get their hands on the latest hi-tech gizmos like wireless home security and Wi-Fi controls for their utilities.
Home buyers also want style over substance, preferring French doors over regular doors, and they want luxuries like a double sink in the kitchen, and a hot tub and shower in the bathroom.
Luxuries like a golf course community and an elevator have gone out the window in the eyes of many home buyers. Consumers don’t see the need for laminate countertops, nor do they have a use for wine cooler refrigerators anymore. Mind you, they’d like some outdoor space – but an outdoor kitchen is probably a little too excessive for most.
What most people are looking for is access to the right kinds of amenities and they prefer to live outside of cities and live in the suburbs. Watch a video on the NHB report.
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Bernanke: Housing Market Has Hit Bottom
Federal Reserve chief Ben Bernanke gave a cautiously optimistic view of the U.S. housing market recently, saying evidence suggested the market had hit the bottom over the last year and was recovering.
Mr. Bernanke was testifying before the House Financial Services Committee when he said the Fed’s bond buying program appeared to be having a positive early impact on the housing market, helping homeowners refinance existing loans or buy new homes.
Bernanke said house prices had dropped 30% nationwide from their peak since the beginning of the financial crisis, but said prices of homes had crept up over the last year.
The number of foreclosures, while still too high, are declining as are the number of homeowners who are underwater, a term meaning they owe more on their mortgages than their homes are now worth.
Bernanke said the continuing improvement in the housing market would have a positive impact on the employment picture, both by directly creating more jobs in home construction and factories that make home goods, and also indirectly by improving peoples’ sense of wealth.
