What's Happened to the Housing Recovery? - Real Time Insight
While there are many stories about multiple bid scenarios playing out on houses in the major metropolitan areas across the United States, and home prices have soared over the last year in many markets, the recent housing data has been telling a different tale.
The winter months were slow and that was blamed on the polar vortexes. It was simply too cold for people to be out looking at and buying houses. The home builders also were delayed in starting new construction.
But June's housing starts and permits just disappointed forecasts.
Housing starts were 893,000 well under the forecast of 1.02 million.
Single-family starts fell to 575,000, the lowest since Nov 2012.
Multi-family starts, which had been hot for the last several years, were also down but those can vary more from month to month.
Permits also fell to 963,000 which was below May's revised rate of 1.005 million. However, June's permits were still 2.7% above last year.
Existing Home Sales Aren't Great Either
Existing home sales have also been weaker than expected. Last week, mortgage applications dropped 17% from a year ago and remain near 20-year lows.
First time home buyers also number only about 30% of all buyers, whereas historically, they equal at least 40%.
Janet Yellen has talked about the recent housing weakness in various speeches and in her Congressional testimony this week saying that housing has shown very little recent progress and remains disappointing.
The excuse can no longer be "it's the weather."
If housing weakens further, will the Fed step in to try and support it?
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