- Posted August 27, 2013 by
Home Prices On The Rise While New Construction Homes Slip
Reports this week show conflicting numbers for the real estate recovery with sales of new construction homes falling and overall home prices on the rise. According to a report today on CNN.com, home prices continue to increase with Illinois finally posting some slight gains.
Resale home purchase transactions are up and home prices are up while foreclosures and market time are down. All of which are helping the overall real estate recovery. One major hinderance is rising rates. Since mortgage rates hit lows in May, they are now up a full percentage point in just a few months. Industry experts point to rising rates having a negative affect on the Illinois real estate recovery, especially for Illinois home builders of new construction homes.
In 20 of the largest cities across the country, home prices were up in June, rising 12.1 percent compared to last year. This data comes from the latest S&P/Case-Shiller home price index and is in line with the reported 12.2 percent gain reported in May. Findings also show that although home prices are on the rise, the pace of sales appears to be slowing.
In other news, sales of new construction homes fell in July. New homes sales were down 13.4 percent in July, compared to the month prior. Even so, they were still up 6.8 percent compared to July 2012. Economists point to rising interest rates as the leading cause in the slow down of new home sales. The slow down in new construction home sales was largest in the Western region, down 16.1 percent. The Midwest slowdown in July was 12.9 percent. For the time being, resale homes are posting impressive gains while new construction sales lag behind. Overall, both are seeing year-over-year improvements and are making strides towards a long-term recovery.
Did you know? On average nearly 15,000 homes sell every day in the United States? The Existing Home Sales Report from the National Association of REALTORS® shows annualized sales are currently at 5.39 million. Do the math and you’ll find it equals out to nearly 15,000 sales every single day!