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Mixed Results for Home Sales, Prices

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While the sale prices for new homes dropped 1.5% year-over-year, Redfin reports that new home sales spiked 5.6%—the second consecutive quarter of increases. 

Home-sale prices fell to a new average of $370,000 for Q3 2019—the biggest price decline since 2012 and the third consecutive quarter of declines. 

The new-home supply fell 7.9% annually, which is also the most significant inventory drop since 2012, and the second straight quarter of declines. 

Prices for existing homes rose 4.2% from 2018, while sales increased by 2.1%. The supply of existing homes fell by 6.9%. 

Redfin stats the 10% year-over-year rise in residential building permits could signal the start of a “moderate recovery” for the new-home market. 

"Buyers are returning to the new-home market thanks to low mortgage rates and relatively low prices," said Redfin Chief Economist Daryl Fairweather. "And builders, also taking advantage of low-interest rates to fund projects, are paying attention to preferences for affordability, which has led to more sales. Residential construction was a bright spot in the economy in the third quarter, a sign that builders are working to fill an inventory gap. As we head into the new year, I expect more new-home listings to hit the market, which should help sustain the relatively high level of sales."

Freddie Mac revealed the average 30-year fixed-rate mortgage rose to 3.75% from last week’s 3.69%. 

“The modest uptick in mortgage rates over the last two months reflects declining recession fears and a more sanguine outlook for the global economy,” said Sam Khater, Freddie Mac’s Chief Economist. “Due to the improved economic outlook, purchase mortgage applications rose fifteen percent over the same week a year ago, the second-highest weekly increase in the last two years. Given the important role residential real estate plays in the economy, the steady improvement of the housing market is a reassuring sign that the economy is on solid ground heading into next year.”

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
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