The housing market’s performance so far this year left a lot to be desired, but Redfin (www.redfin.com) expects the market in urban areas to regain its footing over the second half of 2014. In the June 2014 Redfin Housing Market Tracker, Redfin chief economist Nela Richardson predicts a late summer rebound for four reasons:
1. Sales are catching up to 2013’s highs.
With 114,240 home sales, June 2014 came close to the high bar set last year, which was the strongest year for home sales since the recession. In June, sales were down only 2.5 percent year over year. Sales in the second quarter of 2014 are up 45 percent from the first three months of the year.
2. Homebuyer demand is up.
Redfin data shows that the number of customers going on tours with Redfin agents in June was up 27.1 percent from a year ago. Tour growth in bucking seasonality trends, which tend to peak in May. This indicator of buyer demand continues to strengthen as we head into the second half of the year.
“In Atlanta, the market slowed in late spring and felt really quiet around Memorial Day. But once summer officially started, the buyers came back,” said James Marks, Redfin real estate manager for the Southeast region. “Last year, a lot of homebuyers who got frustrated by the low inventory gave up on buying and re-signed their leases. Their leases are about to expire and now they’re back, taking a fresh look at the new, but still limited, inventory.”
3. Price growth is becoming more sustainable.
Even as the median sales price in June topped $300,000 in urban markets, price growth reached a two-year low of 6.4 percent. Prices over the past three years have been an expensive roller coaster for both buyers and sellers, depreciating in 2011 and jumping by double digits by the end of 2012. Price growth through 2013 averaged 14 percent. In June, the median sales price grew at half that rate, much more in line with a sustainable rate that won’t have the market panting to keep up.
4. Home inventory is returning, albeit slowly.
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By: N/P. “Redfin Housing Market Tracker: Four Reasons Things Could Improve in the Second Half of 2014 – Press Release – Digital Journal.”
Digital Journal. 07/18/2014. Web: Redfin Housing Market Tracker: Four Reasons Things Could Improve in the Second Half of 2014 – Press Release – Digital Journal.
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