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Contract Signings See Little Change In July

When a buyer’s offer is accepted and a contract to buy is signed, that home’s sale is considered pending until it closes weeks later. Because most pending sales end in final sales, contract signings are considered a good indicator of future sales numbers. That’s one of the reasons the National Association of Realtors tracks them each month. In July, the NAR’s Pending Home Sales Index found signings relatively flat, with pending sales down 0.4 percent from the month before and 0.7 percent lower than last year at the same time. Lawrence Yun, NAR’s chief economist, says buyers are hesitant but interested. “Rising mortgage applications for home purchase are an early indicator of more serious buyers in the marketplace, though many have not yet committed to a pending contract,” Yun said. “The Federal Reserve signaling that they may enact a lower interest rate policy should steadily enlarge the pool of eligible home buyers in the upcoming months.” Regionally, contract signings were flat in the Northeast and South. The Midwest saw a 4 percent decline and the West was up 3.7 percent month-over-month. (source)

Buyers Push Mortgage Purchase Demand Higher

According to the Mortgage Bankers Association’s Weekly Applications survey, average mortgage rates inched higher last week from one week earlier. Rates were up for most loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances and 15-year-fixed-rate loans. The increase caused a decline in refinance application demand but failed to dissuade home buyers, who pushed purchase demand 2 percent higher than the week before. Joel Kan, MBA’s vice president and deputy chief economist, says it was the strongest week in a over a month. “Purchase applications had their strongest week in over a month, up 2 percent, and the average loan size increased to its highest level in two months at $433,400,” Kan said. “Prospective buyers appear to be less sensitive to rates at these levels and are more active, bolstered by more inventory and cooling home-price growth in many parts of the country.” Demand for loans to buy homes is now 25 percent higher than last year at the same time. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

Yellow arrow painted on concrete pavement.

Home Prices See Slowest Annual Increase In Years

The S&P Case-Shiller Home Price Indices is considered among the leading measures of U.S. home prices. Its National Home Price Index covers all nine census divisions and has been collecting data for 27 years. According to the most recent results, home prices were up just 1.9 percent year-over-year through the end of June – down from a 2.3 percent increase the previous month. Nicholas Godec, head of Fixed Income Tradeables & Commodities at S&P Dow Jones Indices, says it’s the slowest annual increase in years. “June’s results mark the continuation of a decisive shift in the housing market, with national home prices rising just 1.9 percent year-over-year – the slowest pace since the summer of 2023,” Godec said. “What makes this deceleration particularly noteworthy is the underlying pattern: the modest 1.9 percent annual gain masks significant volatility, with the first half of the period showing declining prices that were more than offset by a 2.5 percent surge in the most recent six months, suggesting the housing market experienced a meaningful inflection point around the start of 2025.” (source)

Red dollar sign on white square paper.

Flat Sales Hit The New Home Market

Sales of newly built single-family homes were mostly unmoved in July from the month before, according to newly released numbers. The data – from the U.S. Census Bureau and the Department of Housing and Urban Development – shows sales of new homes were 0.6 percent lower in July than they were the previous month and are now 8.2 percent lower than year-before levels. The summer stall comes at a time when home builders are lowering prices and trying to lure prospective home buyers. Evidence of that can be found in the Census Bureau’s numbers. For example, the median sales price of new homes sold in July was $403,800 – down from June when it was $407,200 and lower than last year when the median sales price of a new home was $429,000. Lower prices may be enticing buyers because, though new home sales were down from the month before, they still beat economists’ expectations in July, which could be a good sign for the housing market and overall economy. (source)

New Home Construction 13% Higher Than Last Year

New numbers from the U.S. Census Bureau and the Department of Housing and Urban Development show the number of new homes that began construction in July was 5.2 percent higher than the month before and 12.9 percent higher than last year at the same time. Among the gains, single-family home construction rose 2.8 percent month-over-month. The improvement is welcome news – as the housing market continues to add inventory, helping balance the market and provide home buyers with more choices. But while increased new home construction is good for buyers and the overall market, the gains were not evenly distributed. In fact, construction increases were seen mostly in the South, while the Midwest, West, and Northeast all saw declines from the month before. There are a number of reasons for this, including challenging affordability conditions, but the disparity is also a reflection of uncertainty in the market. That might explain why, though starts were up, permits for future construction remained relatively flat in July. (source)

Existing Home Sales Increase 2% In July

The housing market is becoming more balanced and it’s putting home buyers in better position. Buyers are benefiting from a rising number of homes for sale, which has caused home price increases – and the overall market – to slow. Perhaps that’s why sales of previously owned homes saw a 2 percent month-over-month increase in July. According to new numbers from the National Association of Realtors, sales were up in the Northeast, South, and West, while falling 1.1 percent in the Midwest. Lawrence Yun, NAR’s chief economist, says buyers are better situated than they’ve been in a long time. “The ever-so-slight improvement in housing affordability is inching up home sales,” Yun said. “Home buyers are in the best position in more than five years to find the right home and negotiate for a better price. Wage growth is now comfortably outpacing home price growth, and buyers have more choices.” It’s true. The number of homes for sale is currently at its highest level since May 2020, with a 4.6-month supply of available homes at the current sales pace. A 6-month supply is considered healthy for the market. (source)

For Sale sign in grassy field.

Purchase Application Demand Still Up From Last Year

Demand for loans to buy homes continues to outpace last year’s level, according to new numbers from the Mortgage Bankers Association. The MBA’s weekly applications survey found purchase application demand was 23 percent higher than year before levels last week, despite only increasing 0.1 percent from the week before. Joel Kan, MBA’s vice president and deputy chief economist, says demand from buyers has persisted, despite economic and affordability challenges. “Purchase applications were little changed over the week but were at the strongest pace in four weeks and continued to run well ahead of last year’s pace,” Kan said. “Prospective home buyers remain more active compared to last year despite economic headwinds and uncertainty and affordability challenges.” Average mortgage rates were mixed last week, with rates up for 30-year fixed-rate loans, 5/1 ARMs, and 15-year fixed-rate loans, but down for jumbo loans and loans backed by the Federal Housing Administration. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

Listings Last Longer On The Market

A few years back, it wasn’t unusual for an attractive home to be listed for sale on a Thursday and sold before the end of the weekend. The market was frenetic and home shoppers didn’t have much time to deliberate. Buyers had to move fast if they hoped to get an offer submitted before the seller had multiple competing offers already in hand. These days, the market has slowed down. In fact, according to one recent analysis, listings sold in July were on the market an average of 24 days. That’s six days longer than last year at the same time and significantly more time than during the height of the pandemic-era buyers’ boom, when homes for sale sold in days rather than weeks. Naturally, slower sales are good for home buyers, as they mean less pressure and more time to think over a big financial decision. For sellers, it means adjusting expectations and putting in more effort. If sellers want their homes to sell quickly, they’ll have to price them correctly and make them as attractive to buyers as possible. (source)

Builder Confidence Flat As Buyers Wait On Rates

Each month, the National Association of Home Builders takes a survey of builders and scores their answers on a scale where any number above 50 means more builders view conditions as good than poor. Flat now for several months, the NAHB’s Housing Market showed little change in August, with builder confidence down one point from July to 32. Since May, the index has been holding between 32 and 34. Buddy Hughes, NAHB’s chairman, says buyers and builders are both waiting for change. “Affordability continues to be the top challenge for the housing market and buyers are waiting for mortgage rates to drop to move forward,” Hughes said. “Builders are also grappling with supply-side headwinds, including ongoing frustrations with regulatory policies connect to developing land and building homes.” Still, despite current frustrations, home builders remain relatively optimistic about the future, with the index component measuring expectations for the next six months scoring a 43. (source)

Home Values Higher In Good School Districts

A new study from the National Association of Realtors’ consumer website shows why homeowners benefit from living in an area with good schools. The study looked at the 50 most popular school districts by metro area and found that, in more than half of them, median list prices averaged $1.21 million, which is 135 percent higher than in surrounding metros. That’s a big benefit. Danielle Hale, the website’s chief economist, says schools have always been a factor for buyers. “School quality has long been a driver of home buying decisions,” Hale said. “Our data shows families are making trade-offs – sometimes paying a significant premium for top-rated districts, and other times prioritizing value in areas that still offer strong academics. This year, we also saw a sizable interest in districts outside major urban centers, reflecting both affordability concerns and a desire for lifestyle amenities.” (source)

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