As Home Resales Stagnate, Distressed Homes Sell At 20% Discount

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The housing market recovery stalled last month. At least temporarily.

Sales Stagnate, Supplies Surge

According to the National Association of REALTORS®, Existing Home Sales slipped 1 percent in April from the month prior, falling to 5.05 million units on a seasonally-adjusted, annualized basis.

The reading is exactly in-line with report's 6-month average which also reads 5.05 million units.

The data may appear "average" at first glance, but there's another angle to consider. In April, as compared to March, the supply of existing homes for sales spiked. This is a big deal.

At the current pace of sales, it would now take 9.2 months to exhaust today's complete home inventory. This is almost one full month worse than March, and the worst reading of the year.

In addition, in terms of available units, there are also more homes "on the market" today than at any time since September 2010.

Interesting Stats From The Existing Home Sales Report

The Existing Home Sales report does more than just talk about raw sales figures and supplies. It breaks down buyers by "type" (e.g.; first-time buyer, investor, repeat buyer), and gets deeps into stats, too.

Some of the noteworthy statistics from the April Existing Home Sales report include:

• 31 percent of all homes sold in April were purchased with cash
• First-time home buyers bought 36 percent of all homes in April
• Distressed properties typically sold at a 20 percent discount

This "discount", it should be noted, is a major reason why distressed properties accounted for 37 percent of the home resales in April. Home buyers are finding bargains when they're willing to consider homes in various stages of foreclosure and short sale.

Capitalize On Rising Home Supplies

Overall, the April Existing Home Sales report represents opportunity for home buyers. Sales are stagnant, supplies are rising and there's no shortage of properties from which to choose. Furthermore, mortgage rates remain low.

Play the trends to your advantage. Call me at 513-443-2020 or. Include some notes on your situation and I'll get back with you with rate quote, and a pre-approval letter, if you need one.

Hhomes are cheap and mortgage rates are low. This may not be true later this year. The best "deals" may be what you buy now.

(Post adapted from Bring the Blog, a blog-writing service for sales professionals).