The number of sales of previously occupied home has risen 7.8 percent between August and July this year. The increased activity in the housing market is at its highest level in over two years, at a seasonally adjusted rate of 750,000.
The new numbers are significant because they are higher than levels from May 2010, when the government was offering generous tax credits to home buyers which resulted in a spike in home sales.
One contributing factor to the better numbers is the slowing rate of foreclosures and short sales, which often make it more difficult to resell a home and can drag down prices in areas with high foreclosures rates.
Experts say that along with the pent-up demand for homes, the Federal Reserve’s plan to increase purchases of mortgage-backed securities is helping to instill confidence in the market and maintain low interest rates on mortgages. This will be helpful to first-time home buyers who often struggle to get a mortgage because of a lack of credit.
The market still hasn’t returned to pre-recession levels and experts say that sales of previously occupied homes isn’t quite back where it should be for a healthy economy. However, the boost in sales overall should have benefits for the broader economy as consumers feel more secure and begin spending more on basic products and services.
Our Oakland County law firm assists residents with a variety of real estate matters, including buy and sell agreements and drafting leases. More information is available on our website.
Source: Associated Press, “U.S. home sales jump 7.8% to highest levels since May 2010,” Christopher S. Rugaber, Sept. 19, 2012.