Real Estate Market

October 2016 News

Existing Homes Sales Report

Sales of existing homes slowed a bit in August for a second month in a row even with mortgage rates near record lows. According to the National Association of Realtors® (NAR), higher home prices and inventory shortages kept some buyers on the sidelines. The Northeast was the only region with a monthly increase in August closings, partly owing to relatively better inventory t.

Total existing-home sales (measuring transactions for single-family homes, townhomes, condominiums, and co-ops) dropped 0.9 percent to a seasonally adjusted annual rate of 5.33 million in August from 5.38 million in July. Following August's decline, sales sit at their second-lowest pace of 2016 -- but are still slightly above (0.8 percent) one year ago (5.29 million).

Existing Home Sales By
Region NAR's chief economist, Lawrence Yun, said that recent job growth is not translating to higher home sales. "Healthy labor markets in most the country should be creating a sustained demand for home purchases," Yun said. He added, "however, there's no question that after peaking in June, sales in a majority of the country have inched backwards because inventory isn't picking up to tame price growth and replace what's being quickly sold."

Housing Data Takeaways

  • The median existing-home price (all housing types) in August was $240,200, up 5.1 percent over August 2015 ($228,500). August's price rise marks the 54th consecutive month of year-over-year price gains.
  • Total housing inventory by August's end dropped 3.3 percent to 2.04 million existing homes for sale, and now sit 10.1 percent lower than a year ago (2.27 million); inventory has fallen year-over-year for 15 consecutive months. Unsold inventory at the current sales pace shows a 4.6-month supply, down from 4.7 months in July.
  • First-time buyers represented 31 percent of transactions in August, down from 32 percent both in July and one year ago. For all of 2015, first-time buyers drove 30 percent of sales.
  • According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 3.44 percent in August for a second month in a row and stayed at its lowest rate since January 2013 (3.41 percent). In 2015, the average commitment rate  was 3.85 percent.

NAR President Tom Salomone, of Real Estate II Inc. in Coral Springs, Florida, says in today's fast-moving market, a Realtor® who knows about down payment options and their target area is essential to a successful buying experience. But buyers also need to have their ducks in a row according to Salamone. "Home shoppers serious about buying need to be ready with a pre-approval. This allows a Realtor® to hone in only on homes within the buyer's price range and ensures any offer presented to the seller is taken seriously."

Find the Right Coverage

When purchasing a home, you will need to acquire homeowners insurance. In fact, all lenders will require a policy to be in force prior to funding the loan. Make sure you have enough coverage should anything happen. Policies refer to "replacement costs" that may not cover everything. You should ask your insurance agent a lot of "what if" questions. The deductible amount also plays a big part in setting your premium. Higher deductibles lower the number of claims, and reduce your insurance costs.

Check with your insurance agent for more information on these issues and others. If you don't have an insurance agent, we have access to several top-notch agents to whom we can refer you with confidence.

Seller Opportunities

Selling your home in today's market requires strategy and execution. Here are three tips to help sellers reduce their time on market:

  • Make it shine. Buyers are attracted to attractive homes. Make your home stand out by mowing the lawn, raking the leaves, washing windows, and cleaning the carpets. These are small things that make a big difference.
  • Remove clutter. Not only do clean homes show better, but tidy homes offer more to the imagination. One person's treasure is another person's trash. Removing unnecessary clutter will help potential buyers envision their own potential for the home.
  • Consider removing art and personal keepsakes. Beyond general de-cluttering, some sellers also remove all or most of their personal artwork, family photos and personal mementos to give potential buyers an even better chance to imagine the home being theirs. This can be hard emotionally, but don't take it personally.
  • Pay attention to the market. Work with your agent and price your home to sell. A competitively priced home is the one that sells first, and in this market that counts for a lot. Overpriced homes often end up selling for less or incurring much greater holding costs than if they had been appropriately priced in the first place. An experienced agent will help you arrive at the most advantageous price for your home.

These simple tips can help you sell your home and take advantage of our today's market. Please contact us if you have any questions about selling your home. We are here to help!



Contact Information

Photo of John Riggins REALTOR RB11175 Real Estate
John Riggins REALTOR RB11175
John Riggins Real Estate
1003 Bishop Street, suite 2700
Honolulu HI 96813
Fax: 888.369.3210