Americans buy existing homes at fastest pace in a decadeBy CHRISTOPHER S. RUGABER AP Economics Writer
Feb 22, 11:47 AM EST
WASHINGTON (AP) -- Americans shrugged off rising mortgage rates and bought existing homes in January at the
fastest pace since 2007. That has set off
bidding wars that have pushed up prices as the supply of available homes has dwindled to record lows.
snip
The supply crunch will likely get worse during the upcoming spring buying season, economists say, as demand typically rises by more than supply during that time.
snip
"Relative to the number of households, the number of homes for sale is well through prior historic lows," said Ted Wieseman, an economist at Morgan Stanley. "The level of inventories could be a much bigger challenge moving into much higher sales in the spring and summer."
That, combined with higher mortgage rates, could soon restrain sales.
"We are a bit less gloomy about housing than a couple of months ago but sales will not continue to rise at their recent pace," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.
The bulk of the stronger buying is occurring among higher-priced properties, the NAR said. Sales among homes and condominiums priced at $100,000 and below fell nearly 10 percent in January compared with a year earlier. They rose slightly in the $100,000 to $250,000 bracket and jumped by roughly 20 percent in homes priced at higher levels.
snip.
By some measures, the
housing market has fully recovered from the bust that began in 2006. Yet its newfound health is creating its own set of challenges.
In high-demand markets, mostly on the
West Coast, homes are being purchased after less than a month on the market, according to real estate brokerage Redfin.
Denver was the fastest market last month, Redfin found, with purchase contracts signed just 23 days after listing for a typical home, far below the 43 days that was typical a year earlier. Seattle was the second fastest, with 26 days on the market, followed by Oakland, at 27 days.
The strength in sales should lift growth going forward, as new homeowners purchase furniture, buy appliances and spend more on landscaping and outdoor equipment. Home sales also tend to spur renovations, which helps to update aging properties and generates additional construction work for the broader economy.
http://hosted.ap.org/dynamic/stories/U/US_HOME_SALES?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2017-02-22-10-01-25
