January 2017 Phoenix Home Sales Continuation

by Gary Peruzzini

 

 

Existing Home Sales shot up 3.3% in January to a 5.69 million unit annual rate–their fastest sales pace since 2007! The National Association of Realtors chief economist commented, “challenges remain, but the housing market is off to a prosperous start.” Indeed, existing home sales are up a healthy 3.8% over last year. The challenges include low inventories, which have now fallen 20 months in a row, and a median price up 7.1% from a year ago, thanks to growing demand. But that should bring more on-the-fence sellers into the market to boost supply.

Mortgage rates are still extremely low by historical standards, incomes are increasing and the market will grow, as surveys show home ownership continues to be tPhoenix Risinghe American dream. New Home Sales also had a good beginning to the year, posting a 3.7% gain in January, to a 555,000 unit annual rate. Some negative types harped on the fact that this sales pace was less than expected, and still way below where we were pre-recession. But everyone knows this, and the trend is positive, with new home sales up 5.5% versus a year ago. Plus, our painfully slow economic recovery finally appears to be picking up steam.

Gains in the sales of existing homes and new homes for January are reported above. The final reading of the University of Michigan Consumer Sentiment index for February hit a better than expected 96.3. This was a tick down from January, but still a very strong indicator of a positive mood about the economy among average Americans. Last year’s 1.17 million housing starts was the highest level of home building since 2007.

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