Tag Archives: Housing Demand

Why did demand for housing reverse after five months of gains despite improved fundamental drivers from last year?

With fewer homes for sale on the market over the past year, housing demand has also experienced a decline.

According to the National Association of Realtors, low inventory, affordability, and tight credit are still plaguing the housing market. But NAR President Tom Salomone says he has the solution.

The latest Ten-X Residential Real Estate Nowcast indicates that sales are expected to rise, though the number of homes for sale may be limited by constrained inventory.

The indicators show that the spring of 2016 will be the best season in a decade for the housing market.

Although housing starts are not keeping up with the rate of population growth, the fundamentals for housing demand are positive, according to New York Fed President Bill Dudley.

The August forecast predicts that prices will rise 2.2 percent and sales to increase 4.6 percent compared to this time last year. In September, prices are expected to increase 5.3 percent from last year and sales to rise by 10 percent.

According to Fitch, home prices have grown 50 percent faster in urban centers than in the larger metro statistical areas (MSAs) since 2000. City centers are expected to continue to experience growth due to the shift in demand, even in regions lacking significant fundamental support, and are currently considered overvalued.

On the other hand, the median number of days on the market, or the inventory, increased to 69 days, down 7 percent year-over-year, but up 5 percent month-over-month.

The increasing number of first-time homebuyers is another factor driving up the demand for housing, according to Realtor.com. Many of those first-time buyers are millennials who have been sidelined by the challenging market conditions.