Is the Housing Market Back?
The housing market is showing signs of improvement.
According to Morning Brew, “in our view, while housing demand is challenged, the US housing market has a supply problem, not a demand problem,” wrote Morgan Stanley strategist James Egan in a note today. “Significant improvements in affordability should help demand and therefore lead to higher sales volumes.”
The numbers speak for themselves:
- Sales of freshly constructed homes rose to 739,0000 in July, up 10.6% from 668,000 in June, the Commerce Department said today. Analysts expected the number to be more like 620,000.
- However, prices are still high. The median sales price of a new home in July jumped to $429,800, up from $416,700 last month.
- Broadly, sales of new homes are up 5.6% year-over-year.
- Closed sales of previously owned homes jumped 1.3% in July, the first gain in five months, according to the National Association of Realtors, which reported July data on Thursday.
- Real estate brokerage Redfin found that requests for home tours from their agents rose 4% over the last week, they said yesterday.
“Assuming 6.5% mortgage rates, affordability has improved ~12% from 4Q23, a quantum of improvement that has only happened a few times in the last 40 years,” wrote Egan.
Maybe that means now is the time to circle back to your bookmarked Zillow pages (but no, you probably still can’t afford that $29 million fairy tale castle in Woodstock, Connecticut).—LB
