Housing Market Report: July 2021

July market report

The five-month streak of record-setting home prices has ended, and the home supply is beginning to inch up.

The median home sale price was $362,750 and did not set a new, record high for the first time since early March. Instead, the median price was basically flat (-0.2%) from the four-week period ending July 25 and up 18% from a year earlier.

If low mortgage rates continue, homebuying conditions will likely improve (relative to earlier in the summer), with more options and less competition for homebuyers.

Here are the numbers:

Zillow Home Value Index

  • The typical home value in the United States is now $298,933 (seasonally adjusted value and includes only middle price tier of homes.
  • Values for homes in the U.S. have increased 16.7% over 2020.

New Home Purchases Down

  • New single-family home sales fell 6.6% from June to 676,000 units Seasonally Adjusted Annual Rate (SAAR) from 724,000 units in May.
  • Average sales for the first half of the year are lower than the annual pace for 2020 (812,000 vs. 822,000 SAAR).

Existing Homes Sales Increase After Four-Month Decline

  • The National Association of Realtors® (NAR) reports June sales of existing homes rose 1.4% to 5.86 million units (SAAR) from 5.78 million in May.
  • This is 22.9% higher than 2020.

Based on closings, June sales reflect contract signings in April and May.

New Home Construction Rose for Second Month

Single-Family Housing Starts

  • increased 6.3% – 1.16 million homes (SAAR) in June from 1.09 million units in May.
  • Up 25.8% percent from 2020.

Housing Price Increases Continue to Accelerate Year-Over-Year

  • Annual gains range from 17 to 18 percent.
  • Up 18.0% from 2020.

The FHFA index shows that U.S. home values are up 50% from the peak set in April 2007 during the housing bubble and stand 90% above the low point reached in May 2011.

Homes For Sale Inventory Increased

  • The listed inventory of new homes for sale at the end of June stood at 353,000 units, up 7.0% from May. Up 17.3% year-over-year.
  • 8% lower than the 1.54 million units available in 2020.

The 30-Year-Fixed-Rate-Mortgage (FRM)

  • The FRM remained below 3.0% for a fifth straight week.
  • For the week ending July 22, FRM July average weekly low was 2.78%.

Prior to March 2020, the record low for the 30-year FRM was 3.31% the week ending November 21, 2012, during the recovery from the Great Recession. (Source: Freddie Mac)

 

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JON SULLIVAN

REAL ESTATE AGENT

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