DID YOU KNOW? Sales of new U.S. homes fell to a 5-month low in May, adding to signs of weakness in the sector despite lower mortgage rates. Single-family home sales dropped 7.8% to a 626,000 annualized pace that missed all estimates in Bloomberg’s survey of economists, from an upwardly revised 679,000 rate in April. The median sales price decreased 2.7% from a year earlier to $308,000. The monthly decline was driven by a 35.9% drop in sales in the West. While sales fell sharply in the Northeast and West, they rose in the South to the highest level in a decade. That is a positive sign because the South is the largest region for new-home sales. (Bloomberg)
DID YOU KNOW? A shortfall in housing production is making homes ever more unaffordable for modest-income households and high land prices and regulatory constraints are to blame, according to an annual report from Harvard’s Joint Center for Housing Studies. In its 2019 State of the Nation’s Housing report, the center found that households grew by 1.2 million per year between 2016 and 2018, close to healthy for the population’s size and age composition, likely due to a sound economy and rising incomes.
There were 1.2 million new housing units constructed last year, just keeping pace with the number of new households, but the center estimates there should be 1.5 million new housing units to also keep up with the replacement of older housing, demand for second homes, population shifts across markets and normal vacancies. (INMAN)
DID YOU KNOW? After a 12-year decline, the U.S. homeownership rate rose in 2017 and 2018, to 64.4%, rising most among millennials aged 25 to 39. Still, the ratio of median home price to median household income — a measure of affordability — jumped from a low of 3.3 in 2011 to 4.1 in 2018, just shy of the 4.7 peak at the height of the housing boom in 2005. (INMAN)
DID YOU KNOW? Overall rents rose at a 3.6% annual rate in early 2019, twice the rate of overall inflation. 47.4% of renters remain cost-burdened. (Inman)