Home resales continue to increase, despite fewer homes available for purchase.
According to the National Association of REALTORS®, the April Existing Home Sales showed 4.97 million units sold on a seasonally-adjusted, annualized basis.
The reading marks an 10 percent increase from one year ago.
NAR's Existing Home Sales report tallies home sales of previously-occupied homes and not since the tax-credit fueled year of 2009 have so many "used homes" been sold.
In addition, the trade association reports that just 2.16 million homes remain for sale nationwide -- a 14% change from last year. At the current sales pace, the entire U.S. stock of homes for sale would be sold in 5.2 months.
It's a figure today's home buyers would do well to watch.
Housing market analysts believe that a 6.0-month supply represents a market in balance between buyers and sellers; neither group benefiting from much negotiation leverage. With supply below 6.0 months, then, leverage tends to shift toward sellers.
When home supply falls, more buyers compete for fewer homes, a situation which leads to "multiple offers" and competitive bidding. Homes sell more quickly, at at higher prices.
It's tough to get "great deals" in a seller's market -- just ask a buyer who's won a bidding war.
The Existing Home Sales report revealed other relevant housing data for today's home buyers and sellers.
Most notably, that the average home's Time on Market plunged to 46 days nationwide, down from more than 60 days in March. Statistically, homes are selling forty-five percent faster as compared to a year ago.
Now, some might say that homes are selling more quickly because they're being priced more appropriately (i.e. they're "cheaper"), but that's not the case. The median home sale price is up 11 percent from last year. Home prices appear headed higher through 2013 and into 2014, too.
Buyers outnumber sellers and mortgage rates remain cheap.
The average conforming mortgage rate in April was 3.45 percent for buyers willing to pay discount points -- a 1.39 percentage point drop as compared to April 2011, or $323 monthly on a $400,000 home loan.
FHA mortgage rates were similarly low in April, near 3.375 percent.
When mortgage rates are this low, buyers sometimes feel less sting from rising home prices and are more willing to "extend" themselves a little bit. Plus, with fewer foreclosures coming online, home supplies remain limited.
Last year, 1 in every 3 home sales was "distressed". Today, that ratio is less than 1 in 5.
For today's home buyers, mortgage rates are cheap and low- and no-downpayment mortgages remain plentiful. The FHA requires just a 3.5% downpayment for its mortgage program, and the VA and USDA both offer 100% financing / no-money-down mortgages.
To see how today's mortgage rates fit into your budget, get started with a rate quote. They're free and require no credit check or social security number. The form is online and ready for use. See how much home you can afford.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.
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2015 Conforming, FHA, & VA Loan Limits
Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)