The housing market came roaring back in June, as low mortgage rates and increased economic activity helped push sales of previously owned homes up 20.7% from the prior month.
“The housing market is hot, red hot,” said Lawrence Yun, NAR’s chief economist. “As we are coming out of the lockdown, we see this backlog of buyers…trying to take advantage of the record-low mortgage rates.”
The major question for market watchers is whether June’s strong sales pace is set to continue this summer, or whether home sales will slow as pent-up demand from the spring falls off and unemployment remains high.
Homes typically go under contract a month or two before the contract closes, so the June data largely reflects purchase decisions made in April or May.
New-home sales, which make up about 10% of the market, also showed positive signs in June. A measure of U.S. home-builder confidence rose in July to pre-pandemic levels, the NAHB said last week.
Housing starts, a measure of U.S. home-building, rose 17.3% in June from May, the Commerce Department said last week. Residential permits, which can be a bellwether for future home construction, rose 2.1%.
Source: Wall Street Journal – Nicole Friedman
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