U.S. home sales surge to highest level in 3 years
WASHINGTON (AP) - U.S. sales of previously occupied homes jumped to their highest level in three years last month, bolstered by steady job gains and record-low mortgage rates. The report was the latest sign of a sustained recovery in the housing market.
The National Association of Realtors said Thursday that sales rose 5.9 percent to a seasonally adjusted annual rate of 5.04 million in November. That's up from 4.76 million in October.
Previously occupied home sales are on track for their best year in five years. November's sales were the highest since November 2009, when a federal tax credit that was soon to expire spurred sales. Excluding that month, last month's sales were the highest since July 2007.
Sales are up 14.5 percent from a year ago, though they remain below the roughly 5.5 million that are consistent with a healthy market.
"The report is encouraging, and the positive momentum established in the housing market during 2012 appears likely to continue into 2013," Michael Gapen, an economist at Barclays Capital, said in an email.
Superstorm Sandy delayed some sales in the Northeast, the Realtors' group said. Those delayed purchases will likely close in the coming months, though the increase will be modest, the group said.
Even so, sales rose 6.9 percent in the Northeast last month compared with October. Sales increased 7.2 percent in the Midwest, 7.9 percent in the South and 0.8 percent in the West.
Job growth and low home-loan rates have helped drive purchases. Prices are also rising, which encourages more potential buyers to come off the sidelines and purchase homes. And more people may put their homes on the market if they feel confident they can sell at a good price.
In addition, the excess supply of homes that built up during the housing bubble has finally thinned out. The number of previously occupied homes available for sale fell to nearly an 11-year low in November. The supply of new homes is also near its lowest level since 1963.
At the current sales pace, it would take 4.8 months to exhaust the supply of homes for sale. That's the shortest such span since September 2005.
At the same time, more people are looking to buy or rent a home after living with relatives or friends during and immediately after the Great Recession.
As low supply and rising demand push up prices, builders will likely be encouraged to start work on more homes in coming months, economists said.
"That's a good reason to feel optimistic about housing next year," said Patrick Newport, an economist at IHS Global Insight. "We just don't have enough homes right now, and we need to start building."
Builder confidence rose in December for a seventh straight month to the highest level in more than 6½ years, according to a survey released Tuesday by the National Association of Home Builders/Wells Fargo.
The pace of home construction slipped in November, but it was still nearly 22 percent higher than a year earlier. Builders are on track this year to start work on the most homes in four years.
Economists note that the increase in building should lead to more construction jobs, though it hasn't yet done so. That could mean more construction hiring is coming.
The National Association of Realtors said Thursday that sales rose 5.9 percent to a seasonally adjusted annual rate of 5.04 million in November. That's up from 4.76 million in October.
Previously occupied home sales are on track for their best year in five years. November's sales were the highest since November 2009, when a federal tax credit that was soon to expire spurred sales. Excluding that month, last month's sales were the highest since July 2007.
Sales are up 14.5 percent from a year ago, though they remain below the roughly 5.5 million that are consistent with a healthy market.
"The report is encouraging, and the positive momentum established in the housing market during 2012 appears likely to continue into 2013," Michael Gapen, an economist at Barclays Capital, said in an email.
Superstorm Sandy delayed some sales in the Northeast, the Realtors' group said. Those delayed purchases will likely close in the coming months, though the increase will be modest, the group said.
Even so, sales rose 6.9 percent in the Northeast last month compared with October. Sales increased 7.2 percent in the Midwest, 7.9 percent in the South and 0.8 percent in the West.
Job growth and low home-loan rates have helped drive purchases. Prices are also rising, which encourages more potential buyers to come off the sidelines and purchase homes. And more people may put their homes on the market if they feel confident they can sell at a good price.
In addition, the excess supply of homes that built up during the housing bubble has finally thinned out. The number of previously occupied homes available for sale fell to nearly an 11-year low in November. The supply of new homes is also near its lowest level since 1963.
At the current sales pace, it would take 4.8 months to exhaust the supply of homes for sale. That's the shortest such span since September 2005.
At the same time, more people are looking to buy or rent a home after living with relatives or friends during and immediately after the Great Recession.
As low supply and rising demand push up prices, builders will likely be encouraged to start work on more homes in coming months, economists said.
"That's a good reason to feel optimistic about housing next year," said Patrick Newport, an economist at IHS Global Insight. "We just don't have enough homes right now, and we need to start building."
Builder confidence rose in December for a seventh straight month to the highest level in more than 6½ years, according to a survey released Tuesday by the National Association of Home Builders/Wells Fargo.
The pace of home construction slipped in November, but it was still nearly 22 percent higher than a year earlier. Builders are on track this year to start work on the most homes in four years.
Economists note that the increase in building should lead to more construction jobs, though it hasn't yet done so. That could mean more construction hiring is coming.
How many of those houses were bought by foreign countries !?
Yes and how many of these were bought to become rental properties by the people who cashed in on the crisis only to take back all their assets and set it up to do it all again!
 @Freespeech The decline in home ownership rates implies that virtually all the increase in demand for housing units associated with increased household formation consists of increased demand for rental units. Indeed current estimates indicate that over the past year the number of occupied rental units increased 1.32 million and the number of owner occupied housing units actually declined 175,000.â (âFalling home ownership rate and the housing marketâ, Sober Look)
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Rentals increased by just over a million while owner occupied dipped 175,000. Its worth noting that private equity firms are buying up blocks of hundreds of homes from the banker's shadow inventory with cheap and free government financing. This means that families willing to pay interest rates were thrown out while needing help with existing financing to make way for these firms and their free financing.
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This also means that folks who tried and tried to do the right thing year after year with 2 and 3 jobs still were thrown out and the banks that made the bad loans, bundled the sub-prime loans with prime loans and securitized them all as Triple "A" rated securities and crashed a global financial sector went scott free and are being extended yet again another underhanded trick to make us think this crisis is over while they should have all been locked up or shot.
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Every effort to resolve this issue by the US government has been to simply attempt to restart the credit bubble with manipulation in the housing market, credit market, and the Fed. All of these efforts have and will continue to fail until a free market is allowed to exist in housing, financing and the bond markets. These are criminals running this country and doing business with criminals always results in economic failure.
Still waiting for that crash - LOL
 @Howard Beale No, now dont be silly, you're still waiting for the 3rd crash. Number 1 came in '06, number two came after Obama foolishly initiated his Firsttime Homebuyer program which provided lavish incentives for potential buyers to sign on the bottom line. The program sparked a frenzy of activity in '09 that reversed the direction of the market, but quickly petered out in a matter of months like all manipulation does.
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Is this "Surge" (up to 1981 recession levels) a come back? I doubt it given the fundamentals, but itâs worth noting that the market has never really cleared and that normal supply-demand dynamics have never been allowed to work as one would expect in a free market. In fact, housing is the most manipulated market of all time. Mortgage rates are artificially low due to Fed intervention (QE3). Inventory is artificially low due to the banks withholding of distressed backlog. Down payments are so minuscule (FHA=3.5%) that homebuyers end up leveraged at a 30 to 1 ratio, the same as the big Wall Street investment banks prior to the Crash of â08. And, government-backed mortgage modifications (HAMP) provide generous refinancing to high-risk âunderwaterâ applicants with LTV at 125%, a process that makes subprime mortgages look like a model of prudent lending. So much is fake about todayâs housing market, that itâs a stretch to call it a market at all and is certainly not a "free market".
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How do you explain away anomalies in the data that donât support the mediaâs storyline that âHousing Is Backâ. Did you know that the homeownership rate is still falling? But how can that be, you ask? After all, if housing is recovering, then more people must be moving into homes, right? Wrong. Check out this illuminating post from Sober Look: âSome readers have been asking how one can reconcile positive signs in the housing market with declining rates of homeownership. Indeed, homeownership is falling at an even faster pace than during the 08-10 periodâ¦.The explanation is that so far a great deal of net demand growth in housing has been in rental units. â¦This demand for rentals is in fact one of the factors supporting the housing market â for every renter there is a landlord who buys a home.
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JPMorgan: â There is no contradiction between increased demand for housing and reduced home ownership rates. Demand for housing is mainly dependent on the increase in the number of households, whether these households choose to own or to rent the housing units they live in. Growth of household formation had been stifled during the expansion to date by high unemployment and subdued job growth. â¦. The decline in home ownership rates implies that virtually all the increase in demand for housing units associated with increased household formation consists of increased demand for rental units. Indeed current estimates indicate that over the past year the number of occupied rental units increased 1.32 million and the number of owner occupied housing units actually declined 175,000.â (âFalling home ownership rate and the housing marketâ, Sober Look)
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You go ahead and step right up and put your money where your mouth is and I'll just sit back and watch, OK?
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With your level of intellect and this issue laid so bare before you over the last 5 years, how can you seriously believe that this manipulated market can endure?
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